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Caponegro v. United States Department of Housing and Urban Development

United States District Court, D. New Jersey

October 23, 2019



          Michael A. Hammer United States Magistrate Judge.

         This matter comes before the Court by way of Plaintiff's motion for leave to amend his Complaint. Mot. for Leave to Am. and Supp. Compl., May 15, 2019, D.E. 103. First National Bank of Layton opposes the motion. Opp'n Br., July 5, 2019, D.E. 104. Pursuant to Federal Rule of Civil Procedure 78 and Local Civil Rule 78.1, the Court has decided this motion on the papers. For the reasons set forth below, Plaintiff's motion to amend is denied with prejudice.


         Arthur Caponegro, acting pro se, initiated this action on May 19, 2015, against Defendants, First National Bank of Layton (“FNBL”) and the United States Department of Housing and Urban Development (“HUD”), in relation to a reverse mortgage transaction he entered into with FNBL on July 23, 2012, pursuant to HUD's Home Equity Conversion Mortgage program (“HECM mortgage”). Compl., May 19, 2015, D.E. 1. FNBL moved to dismiss Plaintiff's Complaint shortly thereafter. Mot. to Dismiss, July 6, 2015, D.E. 7.

         While FNBL's motion to dismiss the Complaint was pending, Plaintiff pro se filed an Amended Complaint. Am. Compl., Aug. 26, 2015, D.E. 11. On April 1, 2016, counsel, Kenneth Marano, Esq., entered a notice of appearance on Plaintiff's behalf. Notice of Appearance, Apr. 1, 2016, D.E. 26. On August 16, 2016, after this Court granted Plaintiff's request for leave of Court, Plaintiff's counsel filed a Second Amended Complaint. Am. Compl., Aug. 16, 2016, D.E. 33. The Second Amended Complaint alleged four counts, only two of which appeared to be alleged against FNBL: breach of contract (Count 1) and negligence (Count 4).[1] Second Am. Compl. Aug. 16, 2016, D.E. 33. The breach of contract claim also appeared to contain allegations sounding in fraud; more specifically, that FNBL forged Plaintiff's signature, falsified documents, and made misrepresentations. Id. On November 21, 2016, FNBL moved to dismiss the claims against it. Mot. to Dismiss, Nov. 21, 2016, D.E. 41.

         On October 12, 2016, Plaintiff filed a letter with the Court, seeking an Order terminating his counsel and permitting him to once again proceed pro se. D.E. 38. After a hearing on February 1, 2017, this Court granted Plaintiff's request. Order, D.E. 49. On May 11, 2017, new counsel for Plaintiff, Toni Belford Damiano, Esq., entered an appearance on Plaintiff's behalf. Notice of Appearance, D.E. 58.

         On May 18, 2017, Judge McNulty granted FNBL's motion to dismiss, finding that the Second Amended Complaint: (1) lacked clarity and specificity; (2) lacked precision as to which claim was directed against which Defendant because “it [was] not always possible to confidently infer against which of the defendants an allegation [was] directed;” and (3) failed to meet the heightened pleading standard for forgery and fraudulent misrepresentation claims. Mem. Op., May 18, 2017, D.E. 61, at 1, 7-10. Additionally, Judge McNulty determined that Plaintiff insufficiently pled negligence because there was no assertion FNBL owed any duty to him independent of those arising under the contract. Id. at 12. Finally, Judge McNulty found no feasible breach of contract claim because Plaintiff failed to state the contract or contractual provision at issue. Id. at 10.

         Between June 13, 2017, and May 15, 2019, when Plaintiff filed the motion that is the subject of the present Opinion, Plaintiff had moved eight times for leave to amend. Three of those motions were denied on procedural grounds. One motion was terminated as moot. The other four motions were all addressed on their merits. Each is address herein.

         On June 13, 2017, Plaintiff's counsel filed his first motion to amend, consistent with Judge McNulty's Opinion and Order which permitted the filing of a motion to amend within thirty days. Mot. to Am., June 13, 2017, D.E. 64. This motion was denied on procedural grounds because the filing did not contain a brief, proposed order, notice of motion, certificate of service, or the proposed amended pleading. Order, June 14, 2017, D.E. 65. Plaintiff's counsel filed a second motion to amend on June 15, 2017. Mot. to Am., June 15, 2017, D.E. 66. On July 7, 2017, that motion was terminated as moot because Plaintiff's counsel had filed a third motion to amend on July 5, 2017. Order, July 7, 2017, D.E. 70; Mot. to Am., July 5, 2017, D.E. 69.

         Plaintiff's proposed Third Amended Complaint was attached to the July 5, 2017 motion, and asserted two claims against FNBL, breach of contract and fraudulent misrepresentation.[2] Prop. Am. Compl., Jul. 5, 2017, D.E. 69, ¶¶ 27-80. Plaintiff alleged that there were two different HECM mortgages, the first of which disappeared from the County Recorder's Office and was replaced by the second. Id. at ¶¶ 17, 21, 23. Plaintiff alleges that the second HECM Mortgage was either forged, he was coerced into signing it, or both. Id. FNBL opposed the motion on the grounds of futility and undue prejudice. Opp'n Br., Aug. 8, 2017, D.E. 73. On January 25, 2018, in an oral Opinion placed on the record, this Court denied Plaintiff's motion to amend because it found that permitting the amendment would be futile. The proposed Amended Complaint remained confusingly ambiguous, and had not cured the deficiencies outlined by Judge McNulty in his May 18, 2017 Opinion. Order, Jan. 25, 2018, D.E. 80.

         On February 15, 2018, Plaintiff filed a fourth motion to amend. Mot. to Am. Compl., Feb. 15, 2018, D.E. 81. On May 8, 2018, this Court again denied Plaintiff's motion to amend, finding this proposed Third Amended Complaint nearly identical to the July 5, 2017 proposed amendment, and so suffered from the same infirmities. Order, May 8, 2018, D.E. 83. Specifically, Plaintiff failed to articulate whether his signature on the “second mortgage” was forged or whether FNBL coerced him into signing it. Id. Second, Plaintiff failed to clearly state which contract was allegedly breached. Id.

         On June 8, 2018, Plaintiff filed fifth motion to amend the Complaint, which this Court denied on procedural grounds on July 5, 2018, because Plaintiff failed to file a brief in support of the motion or a statement explaining why no brief was necessary. Mot. to Am. Compl., Jun. 8, 2018, D.E. 84; Order, Jul. 5, 2018 D.E. 85. On July 6, 2018, Plaintiff filed a sixth motion to amend his Complaint. Mot. to File Am. Compl., July 6, 2018, D.E. 86. On November 1, 2018, this Court again denied the amendment, finding that it would be futile because the proposed Amended Complaint was confusing due to its inconsistent factual allegations. The Court further concluded that the proposed amendment was devoid of the necessary factual support to maintain claims for breach of contract, forgery, fraudulent misrepresentation, and fraud in the inducement. Opinion, Nov. 1, 2018, D.E. 91; Order, Nov. 1, 2018, D.E. 92.

         On November 9, 2018, Plaintiff's attorney moved to withdraw, and after oral argument was heard on the matter, this Court granted the motion. Mot. to Withdraw, Nov. 9, 2018, D.E. 93; Order, Jan. 29, 2019, D.E. 96. On March 5, 2019, Plaintiff, again proceeding pro se, filed a seventh motion to file a Third Amended Complaint. Mot. to Am. Compl., March 5, 2019, D.E. 97. This Court denied Plaintiff's motion without prejudice on procedural grounds because it did not contain a red-lined version of the amended pleading. Order, Apr. 10, 2019, D.E. 99.

         On May 15, 2019, [3] Plaintiff filed the eighth and instant motion to amend his Complaint. Mot. to File Am. Compl., May 15, 2019, D.E. 103. In this latest iteration, Plaintiff asserts two causes of action against FNBL: (1) fraudulent misrepresentation; and (2) breach of contract. Id. at 4. FNBL opposes the motion, arguing that Plaintiff again fails to advance any colorable claim against ...

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