                           UNITED STATES DISTRICT COURT
                           FOR THE DISTRICT OF COLUMBIA


SEAN DUFFY,

                 Plaintiff,

      v.                                        Civil Action No. 13-696 (GK}

BANK OF AMERICA, N.A., et al.,:

                 Defendants.


                                  MEMORANDUM OPINION

      Plaintiff         Sean Duffy      ("Plaintiff"         or   "Duffy")      brings      this

diversity action against Defendants Bank of America, N. A.                               ("Bank

of America"),           Wells   Fargo Bank,     N .A.    ("Wells Fargo"),             Mortgage

Electronic        Registration      Systems,     Inc.        ( "MERS") ,     Deutsche Alt-A

Securities         Mortgage      Loan   Trust,     Series           2006-0Al         ("Deutsche

Bank") ,     and        HSBC    Bank    USA,     N.A.        ( "HSBC")       (collectively,

"Defendants")

      This       matter    is   presently before         the      Court      on Defendants'

Motion      to     Dismiss      Plaintiff's      Complaint           [Dkt.     No.     3]    and

Plaintiff's Motion for Leave to File an Amended Complaint                                   [Dkt.

No.   16].       Upon    consideration     of    the    Motions,         Oppositions,        and

Replies,     the    entire      record herein,         and    for    the     reasons    stated

below,     Defendants'         Motion to Dismiss is granted and Plaintiff's

Motion for Leave to File an Amended Complaint is denied.
I.       BACKGROUND 1

         Duffy      is    the     resident      and       owner    in    fee    simple     of    real

property       located       in    the     District        of    Columbia.      Compl.     ~ 1.    On

October 31,          2006,       Aegis Wholesale Corporation                   ("Aegis")       made a

loan      to     Duffy.      Id.    ~    2.   To     evidence       and    secure        the    loan,

Plaintiff signed an Adjustable Rate Note                             ("Note")      Id.     The Note

identified Aegis             as    the Lender and attached the Deed of Trust

    ("Deed")   to secure Duffy's obligation.                       Id.   The Deed also names

MERS     as    "the       nominee       for   Lender       and     Lender's     successors        and

assigns." Id.; see also Compl. Ex. 1, p. 2.

         In 2007,         Aegis    filed      for    bankruptcy,         and on December 15,

2012,      its       final       liquidation         and    dissolution         was   completed.

Compl.     ~   3.     It is undisputed that there is an unsatisfied note

and deed of trust encumbering the property.

         On September 29,            2011,     MERS        assigned the Deed to Bank of

America.       Id.       ~ 16;    see also Compl.            Ex.    2.   This Assignment was

recorded with the Land Records in the District of Columbia.                                       Id.

~ 16.



1
  For purposes of ruling on a motion to dismiss, the factual
allegations of the complaint must be presumed to be true and
liberally construed in. favor of the plaintiff. Aktieselskabet AF
21. November 2001 v. Fame Jeans Inc., 525 F.3d 8, 15 (D.C. Cir.
2008); Shear v. Nat'l Rifle Ass'n, 606 F.2d 1251, 1253 (D.C.
Cir. 1979). Therefore, the facts set forth herein are taken from
the Complaint ( "Compl. ") [Dkt. No. 1-1] .

                                                    -2-
        On January 10,           2013,         Bank of America assigned the Deed to

HSBC as Trustee for Holders of the Deutsche Bank Mortgage Pass

Through        Certificates.            Id.     ~    20;    see   also         Compl.          Ex.     3.     On

January 11, 2013, this Assignment was recorded with the Recorder

of Deeds for the District of Columbia. Id.                             ~   7.

        Bank of America now services the Loan.                              Id.       ~   6. In January

2013,        Bank    of    America        informed          Duffy      that       it       intended           to

foreclose on his home on behalf of HSBC. Id.                               ~    23.

        On March 26,           2013, Duffy filed a complaint in the Superior

Court for the District of Columbia                            [Dkt.    No.       1-1]. On May 13,

2013,        Defendants        removed         the     action     to       this       Court          alleging

diversity jurisdiction [Dkt No. 1] .

        On    May    13,       2013,     Defendants          filed     a       Motion          to    Dismiss

Plaintiff s Complaint
               1
                                       [Dkt.    No.    3]     On May 3 0,             2 013,     Plaintiff

filed an Opposition [Dkt. No. 11]. On June 10, 2013, Defendants

filed a Reply [Dkt. No. 13].

II.     STANDARD OF REVIEW

        To    survive      a     motion        to     dismiss     under         Rule       12(b) (6),          a

plaintiff          need only plead              "enough      facts     to       state       a       claim to

relief that is plausible on its face                         11
                                                                  and to "nudge [                     [his or

her] claims across the line from conceivable to plausible.                                            11
                                                                                                            Bell

Atlantic Corp. v.              Twombly,        550 U.S.       544,     570      (2007).         "[O]nce a

claim has been stated adequately, it may be supported by showing
                                                     -3-
any     set     of   facts     consistent     with      the      allegations         in       the

complaint." Id. at 563.

        Under the Twombly standard,              a   "court deciding a motion to

dismiss must not make any judgment about the probability of the

plaintiffs' success .               [,] must assume all the allegations in

the complaint are true            (even if doubtful in fact)                         [, and]

must give the plaintiff the benefit of all reasonable inferences

derived from the facts alleged." Aktieselskabet AF 21,                           525 F.3d

at     17     (internal    quotation      marks       and    citations       omitted) .         A

complaint       will     not   suffice,     however,        if   it   "tenders        'naked

assertion[s]' devoid of 'further factual enhancement.'" Ashcroft

v. Iqbal, 556 U.S. 662, 678 (2009)                   (quoting Twombly, 550 U.S. at

557)    (alteration in Iqbal) .

III. ANALYSIS

       Duffy     seeks    three   things.     First,        he   seeks   a    declaration

that he "owns the Property free and clear of all encumbrances."

Compl. p.       14. Second,     he seeks a declaration "that none of the

Defendants has         any interest       in his property."           Opp' n    at    1,       8.

Third, he requests that the Court declare the two Assignments of

the Deed void. Id.

       Duffy's first request must be denied because the existence

of    an encumbrance on his property is undisputed.                          Compl.       ~    1.

Because Duffy alleges no facts that chal,lenge the existence of
                                           -4-
the encumbrance,           there is no factual support for a declaration

that    Plaintiff      uowns        the     Property       free     and     clear       of    all

encumbrances."

       Duffy's      second     and        third     requests       are      based       on    his

assertion that the original holder of the Deed,                             MERS,       did not

have the authority to transfer the Deed to Bank of America. He

alleges that uMERS is not now nor has it ever been the holder of

the    Deed   of    Trust,"     and        that    uthe     Deed    of     Trust       does   not

authorize     MERS    to     sell     or     convey       it."    Compl.     ~   17.     In   his

Opposition,        Duffy    insists        that    uthe     Deed    of     Trust       does   not

provide to MERS or the beneficiary any rights with respect to

the Deed of Trust." Opp'n at 4. He repeatedly insists that MERS

is only mentioned twice in the Deed, on page one and page two,

and that u [t] here is no other mention of MERS in the document."

Id. at 10-11.

       This is incorrect.           If Duffy        (or,    for that matter,             any of

the Defendants)       had turned to page three of the Deed, he would

have observed that it specifically grants the right to foreclose

on the property to MERS:

       Borrower understands and agrees that MERS holds only
       legal title to the interests granted by Borrower in
       this Security Instrument, but, if necessary to comply
       with law or custom, MERS (as nominee for Lender and
       Lender's successors and assigns) has the right to
       exercise any or all of those interests, including, but
       not limited to, the right to foreclose and sell the
                                             -5-
       Property; and to take any action required of Lender
       including, but not limited to, releasing and canceling
       this Security Instrument.

Compl.,      Ex.   1, p.       3   (emphasis added) . 2 Thus,            contrary to Duffy's

assertions,        the Deed explicitly provided MERS with the right to

exercise the Lender's interests,                   including,            but not limited to,

the right to foreclose on his property.

       The D.C.         Code provides that "[t]ransfer of an instrument

       vests       in    the       transferee    any    right       of    the        transferor     to

enforce the instrument." Leake v.                      Prensky,         798 F.       Supp.    2d 254,

257    (D.D.C.      2011)      (quoting D.C.       Code       §   28:3-203 (b)).           Thus,   the

rights    vested        in MERS       could be     and were             transferred by valid

assign~ent         to Bank of America.            Se~   Compl.,          Ex.    2.    Those rights

were then transferred by valid assignment to HSBC as Trustee for

Deutsche Bank.           Compl.,      Ex.   3.   Therefore,         Duffy is not entitled

to    either a       declaration        that     the    Assignments            of    the     Deed are

void    or    a    declaration         "that     none    of       the    Defendants          has   any

interest in his property." Opp'n at 1, 8.


2
  In deciding a motion under Federal Rule of Civil Procedure
12(b) (6),    "a court may consider 'the facts alleged in the
complaint, documents attached as exhibits or incorporated by
reference in the complaint,'      or 'documents upon which the
plaintiff's complaint necessarily relies even if the document is
produced not by [the parties] . '" Cannon v. Wells Fargo Bank,
N.A.,      F. Supp. 2d    2013 WL 3306156, at *6 (D.D.C. July 1,
2013) (citation omitted). Thus, the Court can consider the Deed
of Trust, attached to the Complaint as Exhibit 1, and the two
Assignments of the Deed, attached as Exhibits 2 and 3.
                                -6-
       None of Duffy's additional arguments in any way affect the

rights of Bank of America, acting on behalf of HSBC, to exercise

the power-of-sale clause in the Deed.

       First,      Duffy is          incorrect           that    District            of    Columbia         law

requires     a     foreclosing         institution              to     be      the     holder         of    the

underlying Note. See Diaby v. Bierman, 795 F. Supp. 2d 108, 113

(D.D.C.     2011)       (holding           that     "whether          or       not    defendants            are

holders of the note is not dispositive as to whether they have

standing      to    foreclose          on         the     property").               The        District      of

Columbia      is    a    non-judicial               foreclosure              jurisdiction,                which

allows for a power-of-sale to be located in a deed of trust and

then executed by the lender or its representative. See id.; see

also Carter v.          Bank of America,                  N.A.,        888     F.    Supp.        2d 1,      14

(D.D.C.     2012)       (noting        that        District          of      Columbia           is    a    non-

judicial     foreclosure             jurisdiction,              which          "allows          foreclosure

pursuant to a        'power of sale provision contained in any deed of

trust"')     (quoting Leake, 798 F. Supp. 2d at 256).

       Second,      Duffy alleges that there was a violation of D.C.

Code   §    47-1431     when     the        Note        was     sold      in    September            of    2011

without being recorded. Compl.                      ~~    13-14. There is no requirement

that   an    assignment         of     a     note        be   recorded          to        be    valid.      See

Robinson v.        Deutsche Bank Nat'l                    Trust      Co.,       Case No.             12-0732,

2013   WL    1191034,      at     *5        (D.D.C.       Mar.       25,       2013)           (noting     that
                                                   -7-
"District of Columbia law does not require an assignment of a

note or deed of trust to be recorded in order for the transfer

to be valid") ;        Leake,   798 F.     Supp.    2d at 257     (concluding that

bank could enforce note's foreclosure provision under District

of Columbia law, despite its failure to record the assignment of

the note); Diaby,         795 F. Supp. 2d at 112           (holding that "failure

to     record    an    assignment   does      not   give   rise   to   a   cause   of

action")        Thus, Duffy's argument regarding the failure to record

a transfer of the Note is unavailing. 3

        In sum, Duffy signed a Deed which granted MERS a power-of-

sale     over    his    property    if   he     failed     to   make   payments    in

accordance with the agreement.              Duffy has raised no fact or law

which     challenges      the   validity       of   the    power-of-sale    clause,

MERS's ability to assign that right to Bank of America, Bank of

America's ability to assign that right to HSBC as Trustee for


3
    Moreover, D.C. Code § 47-1431 does not expressly confer a
private right of action. The burden is on the plaintiff to show
that "the D.C. Council intended to imply a right to sue for
damages for violations" of the statute. Koker v. Aurora Loan
Servicing, LLC, Case No. 12-1069, 2013 WL 40320, at *7 (D.D.C.
Jan. 3, 2013) (quoting Coates v. Elzie, 768 A.2d 997, 1001 (D.C.
2001)). Duffy has failed to address this issue, much less carry
his burden of proof. His failure to respond to the argument is
enough to consider the issue conceded. See Koker, 2013 WL 40320,
at *7 (dismissing claim when plaintiff "provide [d] no analysis
on the point and simply assume[d] that she may sue for a
violation of the statute"); see also Henok v. Chase Home Fin.,
LLC, Case No. 12-292, 2013 WL 151173, at *7 (D.D.C. Jan. 15,
2 0 13 ) ( sa me) .
                                         -8-
Deutsche       Bank,        or     Bank       of    America's             ability                  to    enforce       that

right on HSBC's behalf. Thus, Duffy has failed to "state a claim

to relief that is plausible on its face,                                    11
                                                                                     Twombly,             550 U.S.       at

570, and Defendants' Motion to Dismiss must be granted.

IV.     MOTION FOR LEAVE TO FILE AN AMENDED COMPLAINT

        Plaintiff           filed        a     Motion              for     Leave              to        File     Amended

Complaint          [Dkt.    No.       16] ,    and that Motion is now ripe.                                       Because

the   proposed Amended                 Complaint              is    based        on           the       same    mistaken

premise       as    the     original           Complaint,                namely,              that       there     is    no

power-of-sale          clause          in     the    Deed,          the    amendment                    the     Plaintiff

seeks    is    futile.        See Hettings v.                      United States,                       677    F.3d 471,

480   (D.C.    Cir.        2012)       (per curiam)                ("A district court may deny a

motion    to       amend     a     complaint             as    futile        if              the    proposed        claim
                                                                                         4
would    not       survive        a    motion        to        dismiss.     11
                                                                                 )   •        Thus,           Plaintiff's

Motion is denied.

V.      CONCLUSION

        For    the         foregoing          reasons,              the     Defendants'                       Motion     to

Dismiss       is     granted,           and        the        Plaintiff's                    case       is     dismissed


4
   In Plaintiff's Reply in Support of its Motion for Leave to
Amend Complaint [Dkt. No. 21], Plaintiff mentions for the first
time "the power of sale contained in the Deed of Trust" without
citation or explanation. Pl.'s Reply Mem. of Law in Support of
His Mot. to Amend the Compl. 4. The rest of Plaintiff's reply
suggests that, even if Plaintiff has now recognized that a
power-of-sale clause is present in the Deed,      he does not
understand the legal significance of that fact.
                               -9-
without       prejudice.       " [T] he    standard      for    dismissing     a    complaint

with prejudice is high:                'dismissal with prejudice is warranted

only when a trial court determines that the allegation of other

facts consistent with the challenged pleading could not possibly

cure    the      deficiency.'"        Belizan      v.    Herson,     434     F.3d   579,     583

(D.C.    Cir.     2006)    (quoting Firestone v.               Firestone,    76 F.3d 1205,

1209     (D.C.    Cir.    1996))      (emphasis     in original).          Because neither

the     Plaintiff        nor   the    Defendant         identified     the    power-of-sale

clause in the Deed,            the possibility that Plaintiff could allege

facts     consistent       with      the   presence       of    a   power-of-sale      clause

that could justify relief has never been addressed.                            Thus,       in an

abundance        of   caution,       the   Court   will     dismiss    the    case without

prejudice.

        An Order shall accompany this Memorandum Opinion.




January 30, 2014



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