                NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                           File Name: 12a0974n.06

                                             No. 11-3431
                                                                                             FILED
                                                                                          Sep 04, 2012
                           UNITED STATES COURT OF APPEALS
                                                                                   DEBORAH S. HUNT, Clerk
                                FOR THE SIXTH CIRCUIT


                                                           )
DIANA WILLIAMS,                                            )        ON APPEAL FROM THE
                                                           )        UNITED STATES DISTRICT
       Plaintiff-Appellant,                                )        COURT     FOR     THE
                                                           )        SOUTHERN DISTRICT OF
                                                           )        OHIO
       v.
                                                           )
                                                           )
CITIMORTGAGE, INC.,                                        )
                                                           )
       Defendant-Appellee.                                 )


Before: SILER and WHITE, Circuit Judges; REEVES,* District Judge.

       PER CURIAM. Diana Williams appeals the dismissal for failure to state a claim of her

putative class-action complaint, which alleged that CitiMortgage’s pattern and practice is to issue

form mortgage-loan-payoff statements that impose unjustified and improper additional interest and

a $50 fax/statement fee as a prerequisite to releasing its mortgages, sums to which it is not entitled.

Williams alleged that as a result, CitiMortgage caused her to pay approximately $600 more than the

amount due under her mortgage and that, although CitiMortgage refunded her the excess payment

approximately one month later, it did so without paying her interest on the $600. We AFFIRM.




       *
       The Honorable Danny C. Reeves, United States District Judge for the Eastern District of
Kentucky, sitting by designation.

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No. 11-3431
Williams v. CitiMortgage, Inc.

                                                 I

       The undisputed facts are set forth in the district court’s opinion:

               The Court derives the following facts from Plaintiff’s Complaint and the
       exhibits attached thereto.

               Plaintiff in this action is Diana Williams. She is a resident of Ohio.
       Defendant in this action is Citi. Citi is a New York corporation with its principal
       place of business in Missouri. Citi specializes in the origination, purchase, receipt
       of assignments in, and servicing of residential home mortgages.

              In July 2006, Plaintiff had a mortgage on her house located in Gahanna, Ohio.
       Defendant held and serviced Plaintiff’s mortgage at that time. Desirous of
       refinancing that mortgage, Plaintiff requested, and Defendant issued, a Payoff
       Statement on July 31, 2006.

               The Payoff Statement provided several pieces of financial information. It
       stated that “PAYOFF GOOD THROUGH SEPTEMBER 1, 2006.” The “TOTAL
       TO PAY LOAN IN FULL” was $133,531.25. In reaching that figure, the Payoff
       Statement itemized each charge as follows:

       PRINCIPAL BALANCE AS OF 07/01/06                               $132,028.11
       INTEREST FROM 07/01/06 TO 09/01/06 AT 6.250%                     $1,421.14
       RECORDING FEE                                                       $32.00
       TOTAL SECURED BY MORTGAGE                                      $133,481.25
       FAX/ STATEMENT FEE                                                  $50.00

       It also listed a per diem interest payment of $22.9216.

                 Additionally, the Payoff Statement included several directions to the user.
       First, it provided the following notice, “IMPORTANT: PLEASE REFER TO THE
       REVERSE SIDE OF THIS STATEMENT FOR IMPORTANT INFORMATION.
       THIS PAYOFF AMOUNT IS GOOD THROUGH THE DATE SHOWN ABOVE
       AND MAY CHANGE DUE TO ANY ACCOUNT ACTIVITY. PLEASE CALL
       1–800–283–7918 TO CONFIRM THE AMOUNT PRIOR TO SENDING
       PAYOFF.” The reverse side of the Payoff Statement then includes several
       statements. It states that “[i]nterest will continue to accrue until the date [Citi]
       receives your payoff funds.” It also provides, “The payoff statement is calculated to
       the Next Interest Due Date to avoid any interest shortfall.” Finally, it states that a


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No. 11-3431
Williams v. CitiMortgage, Inc.

       “refund will be sent to the customer's address, within 30 calendar days after payoff,
       for any remaining escrow funds and/or additional payoff amount.”

               Plaintiff’s refinancing transaction closed on July 31, 2006. Defendant
       received a disbursement from that closing on August 7, 2006 in the amount of
       $133,531.25. Approximately 30 days later, Defendant mailed Plaintiff a check
       labeled “refund of escrow” that included the excess escrow money ($1,087.44) as
       well as the amount of interest Plaintiff overpaid in the disbursement (about $600).

       [] In her Complaint, Plaintiff asserts six counts against Defendant primarily based
       on the allegations that Defendant had a “practice of overstating the amount due on
       its payoff statements” and, as a result, Plaintiff “conferred a benefit upon [Defendant]
       by paying interest and fees in excess of the amounts owed.” The six counts are:
       unjust enrichment (Count I), breach of contract (Count II), breach of contract under
       a third party beneficiary theory (Count III), fraud (Count IV), violations of the Ohio
       consumer protection statutes (Count V), and violations of the Truth In Lending Act
       (Count VI).

Williams v. CitiMortgage, Inc., No. 2:08-CV-368, 2011 WL 1303257, at *1-2 (S.D. Ohio Mar. 31,

2011) (unpublished) (citations to the record omitted).

                                                 II

       CitiMortgage filed a motion to dismiss under Fed. R. Civ. P. 12(b)(6), arguing that explicit

disclosures in its July 31, 2006 mortgage-loan Payoff Statement (which Williams appended to her

complaint) contradicted the entire predicate of Williams’s claims – that CitiMortgage misrepresented

the payoff amount and induced or misled her to pay more than the amount due. The district court

dismissed Williams’s claims with prejudice, and denied leave to amend.

       This court reviews de novo the grant of a Rule 12(b)(6) motion. Savoie v. Martin, 673 F.3d

488, 492 (6th Cir. 2012). In ruling on a Rule 12(b)(6) motion, a court “may consider the Complaint

and any exhibits attached thereto, public records, items appearing in the record of the case and

exhibits attached to defendant’s motion to dismiss so long as they are referred to in the Complaint

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No. 11-3431
Williams v. CitiMortgage, Inc.

and are central to the claims contained therein.” Bassett v. Nat’l Collegiate Athletic Ass’n, 528 F.3d

426, 430 (6th Cir. 2008) (citing Amini v. Oberlin Coll., 259 F.3d 493, 502 (6th Cir. 2001)).

                                                   A

        Williams argues that the district court erred in finding that the language of the Payoff

Statement 1) was not fraudulent or misleading as a matter of law, and 2) squarely contradicted her

claims that CitiMortgage required her to pay excessive interest and improperly required her to pay

a $50 fax/statement fee in order to pay off her loan. She also asserts that the district court’s reliance

on Larson v. CitiMortgage, Inc., No. 08 C 5178, 2009 WL 528690 (N.D. Ill. Feb. 25, 2009)

(unpublished), was erroneous because 1) Larson’s holding is limited to FHA loans rather than

conventional loans such as at issue here, and 2) applicable precedent holds that the determination

whether representations are misleading or fraudulent is generally a question of fact.

                                                   B

        To state a claim for common-law fraud under Ohio law, a plaintiff must allege:

        (1) a representation or, where there is a duty to disclose, concealment of a fact, (2)
        which is material to the transaction at hand, (3) made falsely, with knowledge of its
        falsity, or with such utter disregard and recklessness as to whether it is true or false
        that knowledge may be inferred, (4) with the intent of misleading another into relying
        upon it, (5) justifiable reliance upon the representation or concealment, and (6) a
        resulting injury proximately caused by the reliance.

CitiMortgage, Inc. v. Hoge, 962 N.E.2d 327, 333 (Ohio Ct. App. 2011) (internal quotation marks

and citation omitted).

                                                   C

        The district court’s opinion states in pertinent part:


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No. 11-3431
Williams v. CitiMortgage, Inc.

       [] Defendant relies on Larson v. CitiMortgage, Inc., a case factually similar to the
       case sub judice, in which the court granted the defendant’s motion to dismiss all of
       plaintiffs’ claims with prejudice because the clear and unambiguous text of the
       payment statement contradicted the factual predicate of the plaintiffs’ claims. Case
       No. 08 C 5178, 2009 WL 528690 (N.D. Ill. Feb. 25, 2009) (Leinenweber, J.). In
       Larson, the plaintiffs Eric and Codi Larson owned a condominium with a mortgage
       held by the defendant CitiMortgage, Inc. and insured by the Fair Housing
       Administration. CitiMortgage provided Larson a payoff statement in connection with
       the mortgage. The payoff statement stated that it was good through July 1, 2008, and
       listed the “total to pay loan in full” as $96,160.02. It also included an itemized
       accounting of that figure including, (1) the principal balance as of May 1, 2008, in
       the amount of $95,161.20; (2) interest from May 1, 2008 to July 1, 2008 at 5.500%,
       in the amount of $872.32; (3) an FHA premium, in the amount of $121.50; and (4)
       a fax/statement fee, in the amount of $5.00. The reverse side of the payoff statement
       included, inter alia, instructions regarding the calculation of interest, a telephone
       number to contact the defendant for an update of the payoff amount, specific
       instructions the payoff of FHA or non-FHA loans, and a statement that any
       overpayment would be refunded within thirty days of the payoff. On May 29, 2008,
       the Larsons sold the condominium unit and closed their loan. The day after the
       closing, May 30, 2008, CitiMortgage received from the Larsons $96,160.02, the
       amount listed in the Payoff Statement calculated through July 1, 2008.

               The Larsons then filed a class action law suit alleging CitiMortgage charged
       excessive interest on FHA-insured and other mortgage loans, in violation of federal
       and state law. Plaintiffs brought claims on behalf of two classes of borrowers who
       contracted with CitiMortgage: (1) all FHA loan borrowers; and (2) all mortgage loan
       borrowers. The Larsons claimed that by providing a Payoff Statement with a payoff
       amount “good through” July 1, 2008, CitiMortgage required them to pay excess
       interest when they closed on the sale of their property. Although CitiMortgage
       ultimately returned the extra money, the Larsons claimed Citimortgage gained the
       benefit of having the borrower’s money for an extra month. The Larsons claimed
       that those practices breached CitiMortgage’s contracts with borrowers (the mortgage
       and/or note) and violated multiple statutes. They asserted federal and state law
       claims including breaches of contract and third-party beneficiary contract, consumer
       fraud, restitution, and violations of the Illinois Interest Act.

              The court in Larson considered the payoff statement attached to the complaint
       when ruling on the motion to dismiss, and held that:

              The Payoff Statement on its face clearly contradicts Plaintiffs’ claims
              that Defendant required them to pay excessive interest in order to pay

                                                5
No. 11-3431
Williams v. CitiMortgage, Inc.

               their mortgage in full. The Payoff Statement was not a demand for
               payment for a specific amount due as of a chosen closing date, but
               instead was a quote for a payoff that was “good through” July 1,
               2008. In the Payoff Statement, Defendant disclosed that $96,160.02
               was the amount to pay of the loan in full “good through” July 1, 2008.
               The Payoff Statement did not list a specific payoff amount due on
               Plaintiffs’ chosen closing date or any other date, however, it clearly
               disclosed the manner in which interest was to be calculated and paid
               in connection with the payoff of the loan.

       The court went on to find that based on the face of the complaint and the
       unambiguous text of the payoff statement, the plaintiffs failed to sufficiently allege
       that CitiMortgage “required them or any other borrowers to pay excess interest on
       their mortgages.” Id. at *4. The court granted the motion to dismiss in its entir[e]ty
       and dismissed all claims against CitiMortgage with prejudice.

                Although the Court recognizes Larson is not binding precedent, the Court
       finds it persuasive. See Fitzgerald v. Mallinckrodt, Inc., 681 F. Supp. 404, 407 (E.D.
       Mich. 1987) (decision from a different circuit while not binding may be persuasive)
       (citations omitted). Notably, in its response to this authority, Plaintiff does not offer
       any case with similar facts for the Court to compare. The Court can find no such
       contrary authority, or any authority for that matter with similar facts or allegations
       that offers any merit to the claims advanced by Plaintiff.

               The law is clear that the Court may consider the Payoff Statement, which was
       attached to the Complaint as Exhibit A, in determining whether dismissal is proper.
       “[W]hen a written instrument contradicts allegations in the complaint to which it is
       attached, the exhibit trumps the allegations.” N. Indiana Gun & Outdoor Shows, Inc.
       v. City of S. Bend, 163 F.3d 449, 454 (7th Cir. 1998). See, generally, In re Nat’l
       Century Fin. Enter., Inc., Inv. Litig., 604 F. Supp. 2d 1128, 1157 (S.D. Ohio 2009)
       (citing Fayetteville Investors v. Commercial Builders, Inc., 936 F.2d 1462, 1465 (4th
       Cir. 1991) ( “[I]n the event of conflict between the bare allegations of the complaint
       and any [attached] exhibit ... the exhibit prevails.”)); In re Livent, Inc. Noteholders
       Secs. Litig., 151 F. Supp. 2d 371, 405–06 (S.D.N.Y. 2001) (“[A] court need not feel
       constrained to accept as truth conflicting pleadings that make no sense, or that would
       render a claim incoherent, or that are contradicted either by statements in the
       complaint itself or by documents upon which its pleadings rely, or by facts of which
       the court may take judicial notice.”). “Indeed, if a factual assertion in the pleadings
       is inconsistent with a document attached for support, the Court is to accept the facts
       as stated in the attached document,” see Nat’l Assoc. of Minority Contractors,
       Dayton Chapter v. Martinez, 248 F. Supp. 2d 679, 681 (S.D. Ohio 2002), and is “not

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No. 11-3431
Williams v. CitiMortgage, Inc.

       bound to accept as true a legal conclusion couched as a factual allegation.” Twombly,
       550 U.S. at 555. . . .

               The facts in Larson are nearly identical to the facts in this case and the Payoff
       Statements are virtually identical in their language. Plaintiff suggests that the Larson
       case is distinguishable because the plaintiff paid off an FHA-loan, rather than a
       conventional loan like she had. She states that FHA-loans are governed by a distinct
       regulatory scheme and that an FHA-loan’s interest is not calculated on per diem
       basis. Notably, however, both the payoff statement in Larson and the payoff
       statement in this case include language regarding the payoff of conventional loans
       and FHA-loans. The Court fails to see how the distinction between an FHA or a
       conventional loan is a distinction with merit.

                As in Larson, the Payoff Statement in this case on its face squarely
       contradicts Plaintiff’s claims that Defendant required her to pay excessive interest in
       order to pay her mortgage in full. The Payoff Statement was not a demand for
       payment at all, nor a demand for a specific payment due on a specific date. Instead
       it was a quote for a payoff amount that was good through September 1, 2006. The
       Payoff Statement states the per diem interest rate of 6.250% and the per day interest
       charge of $22.9216. It also disclosed the manner in which interest was to be
       calculated and paid in connection with the payoff of the loan, and informed Plaintiff
       that interest would accrue until the date Defendant received her payoff funds. In case
       of overpayment, the Payoff Statement also stated that a refund would be sent within
       thirty calendar days after the payoff with any remaining escrow funds.

               In addition, as in Larson, the Payoff Statement stated that the “payoff amount
       is good through [September 1, 2006] ... and may change due to account activity” and
       suggested that borrowers call a toll-free telephone number to “confirm the amount
       prior to sending payoff.” Plaintiff does not allege that she called this number to
       determine the exact amount of money due pursuant to the terms of the mortgage on
       her chosen closing date.

Williams, 2011 WL 1303257, at *3-5 (citations to the record omitted).

                                                  1

       Williams contends that any reasonable consumer reviewing the Payoff Statement would

interpret it as requiring payment of all sums listed in its most conspicuous portion – the box entitled

“Payoff Amount Calculations.” Williams maintains that the Payoff Statement is “demonstrably

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No. 11-3431
Williams v. CitiMortgage, Inc.

false” in that it “affirmatively represents that the interest is due through September 1, 2006 and –

significantly – that this interest is part of the “TOTAL SECURED BY [THE] MORTGAGE.” She

asserts that the Payoff Statement unambiguously represented that she was to pay all of these sums,

including the additional impermissible unaccrued interest in order to pay her loan in full. Pl.’s Br.

at 27-30. Williams maintains that the disclosures on the back of the Payoff Statement “do not

mitigate the misrepresentations made on the front . . . on which borrowers would naturally rely.”

Id. at 32. She also argues that “[n]otably absent from CitiMortgage’s arguments below and the

district court’s Opinion . . . is an explanation as to why, if CitiMortgage did not seek to induce

borrowers to pay the unaccrued interest and the improper fees, it did not notify borrowers in clear

language that they need not do so. It could have simply presented the amount of principal due and

the per diem amount and instructed borrowers to calculate the amount of additional interest that

would accrue as of the date of their payoff.” Id. at 33.

       Williams’s arguments sidestep the fact that the front of the Payoff Statement conspicuously

states “Statement Date July 31, 2006,” and “Payoff Good Through September 1, 2006.” The front

of the Payoff Statement repeats that “This payoff is good through the date shown,” i.e., September

1, 2006, and states “Please call 1-800-283-7918 to confirm the amount prior to sending payoff.” The

front of the Payoff Statement also states: “Please refer to the reverse side of this statement for

important information.” The reverse side of the Payoff Statement provides, in a section entitled

“Important Information,” that “The payoff statement is calculated to the Next Interest Due Date to

avoid any interest shortfall.” The “Important Information” section also states: “The final payoff will

be calculated on a per diem basis. Any additional payoff amount will be refunded after the payoff

                                                  8
No. 11-3431
Williams v. CitiMortgage, Inc.

is processed,” and “A refund will be sent to the customer’s address, within 30 calendars after payoff,

for any remaining escrow funds and/or any additional payoff amount.”

        Given these express disclosures, we uphold the district court’s determination that the Payoff

Statement squarely contradicted Williams’s claims that CitiMortgage fraudulently induced or

required her to pay excessive interest.

                                                   2

        Williams’s argument that CitiMortgage improperly charged a $50 fax/statement fee for

releasing the mortgage is also contradicted by disclosures in the July 31, 2006 Payoff Statement. The

district court did not expressly address the $50 fax/statement fee, but did so impliedly when it stated:

“Plaintiff’s claims are undermined by . . . the plain language of the Payoff Statement attached to the

Complaint,” and concluded: “the Complaint and the unambiguous text of the attached Payoff

Statement demonstrate that the Complaint is insufficiently pleaded to allege that Defendant

compelled Plaintiff to pay excess interest on her mortgage or made any misrepresentations as to the

payoff amount of her mortgage.” Williams, 2011 WL 1303257, at *3, 5 (emphasis added).

        The $50 fax/statement fee is one of the figures listed on the front of the Payoff Statement.

The $50 fee is not included in the $133,481.25 “Total Secured by Mortgage” figure, but rather, is

included in the $133,531.25 “Total To Pay Loan In Full” on the front of the Payoff Statement. The

reverse side of the Payoff Statement states under “Important Information”:

                Servicing fees are fees incurred by the mortgagor for services received,
        including but not limited to: document copies, name change documents, verifications
        of mortgage, and fees associated with faxing these documents.



                                                   9
No. 11-3431
Williams v. CitiMortgage, Inc.

That is, the Payoff Statement makes clear that the $50 fax/statement fee is not secured by the

mortgage and represents an independent charge imposed by CitiMortgage for its services.

Williams’s argument that CitiMortgage fraudulently induced or misled her into paying this fee in

order to pay off her loan is thus contradicted by the Payoff Statement.

       The district court also did not expressly address Williams’s allegation that no language in her

mortgage note permitted CitiMortgage to require her to pay the $50 fax fee in order to pay off her

mortgage loan. However, as discussed above, the Payoff Statement indicated that the fax fee was

not required as a condition for releasing the mortgage. In any event, neither the note nor the

mortgage precludes the fax statement fee. Paragraph 5 of the note, entitled “Loan Charges,”

contemplates that charges will be collected in connection with the loan, and paragraph 14 of the

mortgage contemplates loan charges, which it limits in two ways, neither of which is applicable here

(fees expressly prohibited by the Security Instrument or applicable law, and lender may charge fee

for releasing security instrument only if fee is paid to a third party and permitted by law).

                                                  3

       Williams also argues that the district court’s sole reliance on Larson was erroneous and that

applicable precedents hold that the determination whether representations are misleading or

fraudulent is generally a question of fact and not properly resolved on a motion to dismiss.

       Under the circumstance that Williams cited no authority with similar facts and the district

court’s search yielded none, the district court properly looked to Larson, which involved a nearly

identical payoff statement and facts, and the same basic challenge Williams presents – that

CitiMortgage’s payoff statements required borrowers to pay excess interest, and that although

                                                 10
No. 11-3431
Williams v. CitiMortgage, Inc.
CitiMortgage ultimately returned the extra funds, it gained the benefit of having the borrower’s

money for a month.

        Williams maintains that Larson is distinguishable and inapposite because it involved FHA

loans, and FHA lenders are entitled to collect interest through the entire month on an FHA insured

loan, whereas interest on Williams’s loan accrued only as time passes. We disagree.

        The Larson plaintiffs brought claims on behalf of two classes of borrowers who contracted

with CitiMortgage – FHA loan borrowers and all mortgage loan borrowers. 2009 WL 528690, at

*2. Their complaint alleged that CitiMortgage’s policy and practice is to charge interest on FHA and

other loans until the first day of the month following the receipt of prepayment. In any event, that

the Larsons’ loan was FHA-insured as opposed to a conventional loan is immaterial because the

Larson plaintiffs, like Williams, initially overpaid interest and made the same argument Williams

makes here – that CitiMortgage’s payoff statement failed to disclose that the payoff amount due on

the date that the borrower actually pays off the loan is less than the amount due on the “good

through” date set forth in the payoff statement. Id. at *2-3.

        Williams is correct that the question whether particular statements are fraudulent or

misleading is generally one of fact. Carpenter v. Scherer-Mountain Ins. Agency, 733 N.E.2d 1196,

1204-05 (Ohio Ct. App. 1999) (reversing grant of summary judgment of intentional

misrepresentation claim, observing that “[t]he existence of fraud is generally a question of fact”);

Kungle v. Equitable Gen. Ins. Co., 500 N.E.2d 343, 347 (Ohio Ct. App. 1985) (affirming trial court’s

holding after bench trial that fraud claim against insurance agent failed where agent made no

representations on which plaintiff could rely, observing that the existence of fraud is an issue of fact).

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No. 11-3431
Williams v. CitiMortgage, Inc.
However, the district court was not obliged to accept as true the allegations in Williams’s complaint

in the face of the clear language in the Payoff Statement, and could properly conclude that

CitiMortgage’s Payoff Statement was not fraudulent or misleading as a matter of law. See, e.g.,

Micrel, Inc. v. TRW, Inc., 486 F.3d 866, 874 (6th Cir. 2007) (applying Ohio law, upholding grant of

summary judgment of fraud claim on ground that challenged representations were not fraudulent as

a matter of law); Lynch v. Dial Fin. Co. of Ohio No. 1, Inc., 656 N.E.2d 714, 720 (Ohio Ct. App.

1995) (rejecting plaintiffs’ argument that they presented a common-law fraud claim and affirming

summary judgment on basis that fraud allegations were groundless as a matter of law where there

was no misrepresentation or concealment of material fact nor reliance thereon). That the district

court did not expressly address Williams’s argument that a jury should decide whether the Payoff

Statement was fraudulent or misleading is of no consequence given that the clear language of the

Payoff Statement forecloses Williams’s fraud claim.

       For the reasons stated, we AFFIRM.




                                                 12
