United States District Court, District of Columbia
LATAWNYA S. BROWN, Plaintiff,
WELLS FARGO BANK, N.A., Defendant
For Latawnya S. Brown, Plaintiff: Ian Stumpf, LEAD ATTORNEY, JR HOWELL & ASSOCIATES, P.C., Washington, DC; Jimmy R. Howell, Jr., LEAD ATTORNEY, JR HOWELL & ASSOCIATES, Los Angeles, CA.
For Wells Fargo Bank, N.A., Defendant: Paul A. Kaplan, LEAD ATTORNEY, WOMBLE CARLYLE SANDRIDGE & RICE, LLP, Washington, DC.
BARBARA J. ROTHSTEIN, UNITED STATES DISTRICT JUDGE.
Granting Defendant's Motion for Summary Judgment
Plaintiff LaTawnya Brown (" Brown" ) brought suit against Defendant Wells Fargo Bank, N.A. (" Wells Fargo" ), alleging that Wells Fargo's predecessor, World Savings Bank, F.S.B. (" World Savings" ) committed common law fraud and violated the District of Columbia Consumer Protection Procedures Act (" CPPA" ). Wells Fargo moves for summary judgment on all counts. See Dkt. #40. Upon consideration of Wells Fargo's motion, Brown's opposition thereto, and the record in this case, this Court grants the motion.
I. FACTUAL BACKGROUND
In 2006, Brown sought to refinance the mortgage on a property she owns in Washington, D.C. (" the Property" ). Compl. ¶ 13, Ex. B at 1, 3. Brown contacted Landmark Funding, LLC (" Landmark" ), a mortgage broker. Pl's. Opp'n Am. Mot. Summ. J. ¶ 3b. On November 7, 2006, she signed a loan application to be submitted by Landmark to World Savings. Id. The application signed by Brown stated that Brown earned $25,000 per month and that the Property was worth $2,200,000. Id. ¶ ¶ 3d-g. Neither Landmark nor World Savings endeavored to verify Brown's income. Def's. Am. Mot. Summ. J. at 7; Statement of Undisputed Facts (" SUF" ) ¶ 37. On the basis of this application, as well as a credit inquiry and an independent appraisal of the property at issue, World Savings approved Brown's application. Def's. Am. Mot. Summ. J. at 7; SUF ¶ ¶ 40-41. The independent appraiser, acting on World Savings' behalf, opined in December 2006 that the Property was worth $1,100,000. Def's. Am. Mot. Summ. J. at 7; SUF ¶ 43. World Savings then offered Brown a $750,000 thirty-year Option Adjustable Rate Mortgage, also known as a " Pick-a-Payment" mortgage, with a payment cap. Def's. Am. Mot.
Summ. J. at Ex. 13. On January 3, 2007, Brown signed the note. Id. In March 2007, Brown received copies of her mortgage documents. Id. at Ex. 18. Within months of signing the note, Brown's mortgage was experiencing significant negative amortization and she was notified that she was in default in the loan statement dated August 2, 2007. Brown fell behind on her payments and was in and out of default until 2010 when she ceased making payments. Id. at Ex. 4.
Pick-a-Payment mortgages issued by World Savings were the subject of a class action lawsuit, which included 517,783 class members and resulted in a settlement. In re Wachovia Corp. " Pick-A-Payment" Mortgage Marketing and Sales Practices Litigation, Nos. 07-4497-JF and 09-2015-JF, 2011 WL 1877630 (N.D. Cal. May 17, 2011). Prior to the settlement, World Savings was acquired by Wachovia Mortgage Corporation. Def's. Am. Mot. Summ. J. at 1 n. 2. The settlement resolved all claims regarding the origination of Pick-a-Payment loans by Wachovia, its subsidiaries, and its predecessors between August 1, 2003 and December 31, 2008. In re Wachovia Corp., 2011 WL 1877630 at *3. Under the terms of a settlement in that lawsuit, Wachovia agreed to pay consumers $50,000,000 to settle their claims. Id. at *1-2. Brown admits she received a check from the settlement, although she never cashed it. Def's. Am. Mot. Summ. J. at Ex. 3. Wells Fargo acquired Wachovia Mortgage Corporation subsequent to the settlement. Id. at 1, n. 2.
II. PROCEDURAL HISTORY
On June 22, 2011, Brown filed this action asserting three counts against Wells Fargo. First, Brown alleged that World Savings committed common law fraud by misrepresenting the payments she would owe, misrepresenting the likelihood of negative amortization, using prepayment penalties to keep her in a harmful loan, and steering her into a riskier loan despite her qualification for a safer option. Compl. ¶ ¶ 96-107. Second, Brown alleged that World Savings or its agents committed common law fraud by submitting a false loan application on her behalf which misrepresented her assets and income such that she would be approved for a loan product for which she would not ...