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Lathal Ponder v. Chase Home Finance

May 23, 2012


The opinion of the court was delivered by: Barbara J. Rothstein United States District Judge


Plaintiff Lathal Ponder, proceeding pro se,*fn1 brings this action against defendant Chase Home Finance, LLC ("Chase"), presenting various claims arising from a failed effort to modify Ponder's mortgage, which Chase held, and the resulting foreclosure. Specifically, Ponder alleges that Chase breached two separate agreements to modify the mortgage, made material misrepresentations related to those agreements, negligently failed to prepare and deliver documents to him, and violated federal guidelines for foreclosure on homes financed through the Federal Housing Authority ("FHA"). Before the Court is Chase's motion to dismiss, in which it alleges that Ponder's claims are barred by the doctrines of res judicata and collateral estoppel, and further that they fail to state a claim upon which relief may be granted [Dkt. #2]. Upon consideration of the motion, the opposition thereto, and the record of this case, the Court concludes that the motion must be granted in part and denied in part.


In December of 2000, Ponder obtained an FHA-insured loan from a lender (who is not a party to this action) in order to purchase a parcel of property in the District of Columbia. That lender subsequently sold Ponder's loan to Chase. Compl. ¶¶ 6--7. In May of 2008, Chase asserted that Ponder had defaulted on the loan and threatened to commence foreclosure proceedings. Ponder alleges that in July of that year, the parties reached an agreement to modify the loan. Id. ¶¶ 9--12. He asserts that as part of that agreement, Chase agreed to cease foreclosure proceedings on the property. Id. ¶ 13. Ponder waited for Chase to send him a copy of the modification documents, but did not receive one until at least two weeks later, when he discovered an envelope from Chase, largely destroyed by rain, under his doormat, and largely indecipherable. Ponder contacted Chase to request another copy. Accordingly to Ponder, Chase replied that it would send another copy, but Ponder never received one. Id. ¶¶ 15--19.

In August, Ponder received a letter from Chase asserting that he had failed to comply with the modification agreement. He contacted Chase and again explained that he had not received an intact copy of the agreement. Ponder avers that Chase then offered, and he accepted, the opportunity to reapply for the modification. Id. ¶¶ 20--22. Following further delays during which Ponder did not hear from Chase, he contacted Chase again and was told to supply more paperwork, and that the modification had been approved. He provided the requested documents in October. Later that month, he discovered that the foreclosure proceedings against his property were still ongoing. Id. ¶¶ 24--26.

The following July, Ponder filed suit against Chase in the District of Columbia Superior Court, alleging breach of contract, misrepresentation, and negligence. That suit was removed to this Court by Chase and assigned to Judge Rosemary M. Collyer. See Ponder v. Chase Home Finance, No. 09-01351 (July 21, 2009) (notice of removal, dkt. no. 1). Chase moved to dismiss that action for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). Judge Collyer granted Chase's motion, dismissing all of Ponder's claims without prejudice. See Ponder v. Chase Home Finance, 666 F. Supp. 2d 45, 50 (D.D.C. 2009). Ponder subsequently brought this action, seeking damages, a revision of his credit report, and clear title to the property.


To survive a motion to dismiss pursuant to Rule 12(b)(6), a complaint need not contain detailed factual allegations, but it must recite facts sufficient to at least "raise a right to relief above the speculative level . . . on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). A "pleading that offers 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will not do.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 555). In deciding a Rule 12(b)(6) motion, the Court may consider only the facts alleged in the complaint, documents attached as exhibits or incorporated by reference in the complaint, and matters about which the Court may take judicial notice. EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621, 624 (D.C. Cir. 1997).


Chase again seeks the dismissal of Ponder's complaint for failure to state a claim under Rule 12(b)(6), this time on two grounds. First, it argues that, because of Judge Collyer's dismissal of Ponder's previous case, all of his claims are barred by the doctrines res judicata and collateral estoppel. Second, it argues that, even if Ponder's claims are not barred, they do not meet the pleading standards on which Rule 12(b)(6) is based. The Court addresses each argument in turn and, because the case is before the Court on diversity grounds, applies District of Columbia law. See Ponder, 666 F. Supp. 2d at 48 n.2 (applying D.C. law to Ponder's prior claims regarding the same events).

A. Ponder's Claims Are Not Barred by Res Judicata or Collateral Estoppel*fn2 "Under the doctrine of claim preclusion or res judicata, when a valid final judgment has been entered on the merits, the parties . . . are barred, in a subsequent proceeding, from relitigating the same claim or any claim that might have been raised in the first proceeding." Wash. Med. Ctr., Inc. v. Holle, 573 A.2d 1269, 1280--81 (D.C. 1990). Similarly, collateral estoppel, also known as issue preclusion, renders conclusive in the same or a subsequent action determination of an issue of fact or law when (1) the issue is actually litigated and (2) determined by a valid, final judgment on the merits; (3) after a full and fair opportunity for litigation by the parties or their privies; (4) under circumstances where the determination was essential to the judgment, and not merely dictum.

Id. at 1283. Here, Chase asserts that all of Ponder's claims are barred by these doctrines because Ponder previously filed - and Judge Collyer dismissed - an action against Chase based on the same events and involving many of the same claims. Def.'s Mem. in Supp. of Mot. to Dismiss ("Def.'s Mem.") at 4--9; see Ponder, 666 F. Supp. 2d at 50. Ponder retorts that neither doctrine is applicable because the dismissal was without prejudice, meaning that no final judgment on the merits occurred. Pl.'s Opp'n to Def.'s Mot. ("Pl.'s Opp'n") at 5 (emphasis added). Chase acknowledges that Judge Collyer expressly dismissed Ponder's first suit without prejudice, but asserts that she "indeed expressed [her] decision on the merits in a seven-page memorandum." Def.'s Reply to Pl.'s Opp'n ("Def.'s Reply") at 2 n.2. It also points to the court's statement in its Order that it constituted a final appealable order. Ponder's argument is correct.

A dismissal for failure to state a claim under Rule 12(b)(6), as occurred here, normally constitutes a ruling on the merits with preclusive effect. Haase v. Sessions, 835 F.2d 902, 906 (D.C. Cir. 1987). It is, however, "beyond dispute that a dismissal without prejudice does not determine the merits." Interdonato v. Interdonato, 521 A.2d 1124, 1131 n.11 (D.C. 1987); accord Thoubboron v. Ford Motor Co., 809 A.2d 1204, 1210 (D.C. 2002); McAlister v. Potter, 2012 WL 540080, at *3 (D.D.C. Feb. 21, 2012) ("Because the claim was dismissed without prejudice, there was no 'final judgment on the merits,' and res judicata does not apply."); Ciralsky v. C.I.A., 355 F.3d 661, (D.C. Cir. 2004) ("[C]courts often regard the dismissal without prejudice of a complaint as 'not final, and thus not appealable under 28 U.S.C. § 1291, because the plaintiff is free to amend his pleading and continue the litigation.'") (quoting Hoskins v. Poelstra, 320 F.3d 761, 763 (7th Cir.2003) and citing WMX Tech., Inc. v. Miller, 104 F.3d 1133, 1136 (9th Cir. 1997) and 19 JAMES W. MOORE, MOORE'S FEDERAL PRACTICE ยง 201.14 (3d ed. 2003)). There is no language in Judge Collyer's Memorandum Opinion, which itself uses the phrase "without prejudice" as to each individual claim it addresses, that suggests that she intended to depart from this settled use of the term. See Ponder, 666 F. Supp. 2d at 48--50. In addition, the order at issue states explicitly that "Defendant's motion to dismiss is GRANTED; and it is ...

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