                  NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                             File Name: 13a0174n.06

                                            No. 11-2467
                                                                                        FILED
                            UNITED STATES COURT OF APPEALS                           Feb 14, 2013
                                 FOR THE SIXTH CIRCUIT                        DEBORAH S. HUNT, Clerk


ANDREW MELLENTINE; DEBRA MELLENTINE,                      )
                                                          )
       Plaintiffs-Appellants,                             )
                                                          )        ON APPEAL FROM THE
v.                                                        )        UNITED STATES DISTRICT
                                                          )        COURT FOR THE EASTERN
AMERIQUEST MORTGAGE COMPANY; WM                           )        DISTRICT OF MICHIGAN
SPECIALTY MORTGAGE LLC, Without Recourse;                 )
CITI RESIDENTIAL LENDING, INC.; MORTGAGE                  )        OPINION
ELECTRONIC REGISTRATION SYSTEMS, INC.;                    )
CHASE HOME FINANCE, LLC; JP MORGAN                        )
CHASE BANK NA; ORLANS ASSOCIATES P.C.;                    )
UNKNOWN LENDERS;                                          )
                                                          )
       Defendants-Appellees.                              )
                                                          )
                                                          )



BEFORE:        MOORE and COLE, Circuit Judges; ROSE, District Judge.*

       COLE, Circuit Judge. Plaintiffs-Appellants Andrew and Debra Mellentine filed suit against

a number of defendants who, among other things, hold or service a mortgage on their residential

property. In district court, the case was narrowed to claims under two federal statutes, the Fair Debt

Collection Practices Act (“FDCPA”) and the Real Estate Settlement and Procedures Act (“RESPA”).

The Mellentines now appeal the district court’s grant of Defendants’ motions to dismiss under

Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief could be

       *
        The Honorable Thomas M. Rose, United States District Judge for the Southern District of
Ohio, sitting by designation.
No. 11-2467
Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

granted and Rule 12(c) for judgment on the pleadings. For the following reasons, we REVERSE and

REMAND in part and AFFIRM in part.

                                             I. Background

       In 2005, the Mellentines purchased a second home, known as the “Otisville property.” They

applied for and obtained an adjustable rate mortgage for $59,165, secured by their first home, the

“Owosso property.” The mortgage had an initial interest rate of 11.65%. At closing they also signed

an adjustable rate note and mortgage for $206,910, secured by the Otisville property. According to

the Mellentines, they were promised a 30-year loan with a fixed interest rate of 6.5% but were

informed at closing that the loan rate was adjustable with an initial rate of 12.1%. Ameriquest was

initially named as the lender and mortgagee on both loans. The Owosso home was foreclosed and

sold at a Sheriff's sale on July 26, 2006.

       Ameriquest assigned the Otisville loan to WM Specialty Mortgage LLC (“WM”). In May

2007, the Mellentines defaulted on the Otisville loan and WM initiated foreclosure proceedings on

the property. This foreclosure was “inadvertently held,” however, and the sheriff’s deed was

expunged. As a result, Plaintiffs regained ownership of the property. The mortgage for the Otisville

Property was then reassigned or sold to Ameriquest, which had been purchased by CitiResidential

(“CitiRL”).

       In July 2008, the Mellentines received a loan modification agreement from CitiRL, and again

began making payments on the loan. In December 2008, CitiRL assigned the loan to Mortgage

Electronic Registration System, Inc (“MERS”), as nominee for JP Morgan Chase (“JP Morgan”).

At some point, Chase Home Finance, LLC (“Chase”) became the servicer on the loan.

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Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

       On March 31, 2010, the Mellentines were once again in default on the Otisville loan. Orlans

Associates, P.C. (“Orlans”), a law firm acting on behalf of Chase, sent a letter to the Mellentines

notifying them of their default and informing them that Chase was beginning foreclosure proceedings

on the property. On March 28, 2010, MERS assigned the mortgage back to CitiRL.

       In April 2010, the Mellentines contacted Chase in an effort to receive another loan

modification. Having received no response from Chase, in July 2010, Plaintiffs sent Orlans and

Chase a Qualified Written Request (“QWR”), as was their right under RESPA. Chase sent a written

acknowledgment of the QWR on August 10, 2010, and responded to the QWR on October 1, 2010.

The Mellentines discussed a potential loan remodification with Chase and were informed by letter

on October 25, 2010, that they did not qualify. Plaintiffs then initiated this action.

       In March 2011, the Mellentines filed a complaint in the Circuit Court for the County of

Genesee, Michigan, against Ameriquest, Chase, JP Morgan, MERS, CitiRL, Orlans, WM, and

“unknown lenders” (collectively “Defendants”). Soon afterwards, they filed their First Amended

Complaint, asserting nineteen state and federal law claims against Defendants, upon which this

action is based.

       On April 1, 2011, Orlans removed the case to the United States District Court for the Eastern

District of Michigan. All Defendants consented to the removal. On May 11, 2011, the district court

entered an order declining to exercise supplemental jurisdiction and remanding state law claims to

the state court. The remaining federal claims were made under the Truth in Lending Act (“TILA”),

the Home Ownership and Equity Protection Act (“HOEPA”), RESPA, and the FDCPA.



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No. 11-2467
Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

        On April 21, 2011, the district court entered an order allowing Plaintiffs to file a Second

Amended Complaint and extending time for Defendants to file responsive pleadings. However, the

Second Amended Complaint was never filed with the district court.

        In early May 2011, Orlans, Ameriquest, and CitiRL all filed separate motions to dismiss for

failure to state a claim under Rule 12(b)(6). The Mellentines filed a single response on May 24,

2011. Chase, JP Morgan, MERS, and WM subsequently filed a combined motion for judgment on

the pleadings under Rule 12(c). The Mellentines then filed a response to the Rule 12(c) motion and

also moved for judgment on the pleadings themselves. In their response to the motion to dismiss,

the Mellentines withdrew their TILA and HOEPA claims, leaving only their RESPA and FDCPA

claims at issue.

        On October 20, 2011, the district court entered an Opinion and Order granting the motions

to dismiss filed by all Defendants, and denying Plaintiffs’ motion for judgment on the pleadings,

thereby dismissing the case. The Plaintiffs filed a timely appeal.

                                         II. Standard of Review

        Whether the district court properly dismissed a complaint pursuant to Rule 12(b)(6) is a

question of law subject to review de novo. Kottmyer v. Maas, 436 F.3d 684, 688 (6th Cir. 2006).

The court must construe the complaint in a light most favorable to the plaintiff and accept all factual

allegations as true. Kottmyer, 436 F.3d at 688. The factual allegations must “raise a right to relief

above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). In other words,

the Rule 12(b)(6) standard requires that a plaintiff provide “enough facts to state a claim to relief that

is plausible on its face.” Id. at 569.

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No. 11-2467
Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

        “While legal conclusions can provide the framework of a complaint, they must be supported

by factual allegations.” Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). Bare allegations without a

factual context do not create a plausible claim. Ctr. for Bio-Ethical Reform, Inc. v. Napolitano, 648

F.3d 365, 374 (6th Cir. 2011). A complaint must “contain[] direct or inferential allegations

respecting all the material elements under some viable legal theory.” Mezibov v. Allen, 411 F.3d

712, 716 (6th Cir. 2005). The bare assertion of legal conclusions is not enough to constitute a claim

for relief. Id. at 716.

        A ruling on a motion for judgment on the pleadings under Rule 12(c) is generally reviewed

under the same standard as a Rule 12(b)(6) motion. EEOC v. J.H. Routh Packing Co., 246 F.3d 850,

851 (6th Cir. 2001).

                                        III. FDCPA Claims

        The purpose of the FDCPA is to “eliminate abusive debt collection practices by debt

collectors, to insure that those debt collectors who refrain from using abusive collection practices

are not competitively disadvantaged and to promote consistent State action to protect consumers

against debt collection abuses.” 15 U.S.C. § 1692(e). Liability under the FDCPA can only attach to

those who meet the statutory definition of a “debt collector.”

        A. Claim Against Orlans

        The Mellentines seek relief against Orlans under the FDCPA. The district court held that a

law firm enforcing a security interest in a mortgage could not meet the definition of a “debt

collector” under the FDCPA. Since the district court ruled in the instant case, this Court has ruled

to the contrary. Glazer v. Chase Home Finance LLC, No. 10-3416, 2013 WL 141699, at *5-9 (6th

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No. 11-2467
Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

Cir. Jan. 14, 2013). In Glazer we held that “mortgage foreclosure is debt collection under the Act.

Lawyers who meet the general definition of a ‘debt collector’ must comply with the FDCPA when

engaged in a mortgage foreclosure. And a lawyer can satisfy that definition if his principal business

purpose is mortgage foreclosure or if he ‘regularly’ performs this function.” Id. at *9. In light of

Glazer, we are left only to determine if the Mellentines’ complaint is sufficient to allege that Orlans

is a debt collector under the FDCPA.

               1. Adequacy of the Mellentines’ Complaint

       Orlans argues that even if an enforcer of a security interest may fit under the broader

§ 1692a(6) definition of a “debt collector,” the Mellentines have not pleaded facts sufficient to show

that the firm is a “debt collector” under the FDCPA. We disagree.2

       In their complaint, the Mellentines state that Orlans is a debt collector that specializes in

foreclosures and creditor representations. They claim that Orlans held itself out as a debt collector

working on behalf of Chase, a lender to whom the Mellentines owed money. The Mellentines

furthermore claim that Orlans informed them that a sale date was set for foreclosure on their home

and responded to a QWR providing information regarding their mortgage.

       To “survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted

as true, to ‘state a claim to relief that is plausible on its face.’” Iqbal, 556, U.S. at 678 (quoting



       2
          The district court held that the Mellentines did not state a claim under § 1692f(6). While
we reverse the district court opinion on the grounds that as a “debt collector” under § 1692a(6)
Orlans may be liable under § 1692 et seq. we leave it to the district court to determine which specific
FDCPA claims have been asserted. We note, however, that the Mellentines sought relief under §
1692f in their complaint and presume that the district court will consider this issue on remand.

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Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

Twombly, 550 U.S. at 569.) “While legal conclusions can provide the framework of a complaint,

they must be supported by factual allegations.” Iqbal, 556 U.S. at 679. The complaint must provide

the defendant with “fair notice of what the . . . claim is and the grounds upon which it rests.”

Twombly, 550 U.S. at 555 (internal quotation marks and citations omitted). The Mellentines have

adequately met this standard. According to their complaint, Orlans (1) “held itself out as a debt

collector,” (2) worked on behalf of a company to whom the Mellentines owed a debt, (3) specialized

in foreclosures, and (4) had specific information regarding their mortgage debt. These facts, taken

together, plausibly plead and give fair notice that Orlans is a “debt collector” under § 1692a(6) of

the FDCPA.

         B. Remaining Claims Under the FDCPA

         The Mellentines’ remaining claims were made under the FDCPA against Chase, JP Morgan,

MERS, WM, Ameriquest, and CitiRL. The district court dismissed these claims for failure “to plead

any facts as to how or when [Defendants] violated the FDCPA.” The court also held that some

claims were time-barred. Because the Mellentines have failed to raise these claims on appeal they

are waived. See Turner v. City of Taylor, 412 F.3d 629, 639 (6th Cir. 2005).

                                        IV. RESPA Claims

         RESPA was enacted in part to provide “more effective advance disclosure to home buyers

and sellers of settlement costs,” and in response to “abusive practices” in the “real estate settlement

process.” 12 U.S.C. § 2601 (a), (b)(1). The Mellentines allege violations of RESPA by Orlans and

Chase.



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Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

       A. Claim Against Orlans

       Issues raised in the district court, yet not raised on appeal, are considered abandoned and not

reviewable on appeal. Turner, 412 F.3d at 639. The Mellentines have not sufficiently raised any

RESPA claim against Orlans on appeal. See Vance v. Wade, 546 F.3d 774, 781 (6th Cir. 2008) (“an

issue is deemed forfeited on appeal if it is merely mentioned and not developed”) (internal quotations

and citations omitted). This Court therefore considers it waived.

       B. Claim Against Chase

       The Mellentines appeal the RESPA claim against Chase. The district court dismissed this

claim pursuant to Chase’s Rule 12(c) motion to dismiss. The court held that the Mellentines failed

to plead either actual damages or a pattern or practice of noncompliance as is required to recover

under RESPA § 2605(f). We find that the complaint pleads sufficient facts to state a claim under

REPSA.

       A ruling on a motion for judgment on the pleadings under Rule 12(c) is generally reviewed

under the same standard as a Rule 12(b)(6) motion. J.H. Routh Packing Co., 246 F.3d at 851. “[A]

complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations,”

however, it must assert sufficient facts to provide the defendant with “fair notice of what the . . .

claim is and the ground upon which it rests.” Twombly, 550 U.S. at 555 (internal quotation marks

and citations omitted) (second alteration in original). In assessing a motion to dismiss, a Court

evaluates whether “the plaintiff plead[ed] factual content that allows the court to draw the reasonable

inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. “If a

reasonable court can draw the necessary inference from the factual material stated in the complaint,

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Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

the plausibility standard has been satisfied.” Keys v. Humana, Inc., 684 F.3d 605, 610 (6th Cir.

2012).

         The Mellentines have met this standard. They have alleged in their complaint that Chase

“sen[t] a signed response that [was] 10 days late” to their QWR. They furthermore alleged “damages

in an amount not yet ascertained, to be proven at trial.” Section 2605(e) of RESPA sets the response

time within which loan servicers must respond to QWRs—60 days at the time the Mellentines are

alleged to have sent their request. Because the complaint alleges that Chase submitted its response

to the QWR after the statutory time period, the Mellentines’ claim sufficiently sets forth facts upon

which relief can be granted.

                          V. Plaintiffs’ Right to Amend Their Complaint

         The Mellentines appeal the district court’s refusal to grant them leave to amend their

complaint under Rule 15(a). The Mellentines did not file a formal motion to amend their complaint

with the district court; however, they did include language requesting leave to amend in their

response to Defendants’ motions to dismiss and in their motion for judgment on the pleadings. The

district court never acted on these informal requests.

         When a motion for leave to amend is improperly filed and the district court gives no reason

for not allowing an amendment, the abuse of discretion standard generally applies. Pulte Homes,

Inc. v. Laborers’ Int’l Union of N. Am., 684 F.3d 295, 305 (6th Cir. 2011) (“Here, rather than filing

a motion for leave to amend, [the plaintiff] buried its request in a footnote in its brief . . . and the

district court, in its order dismissing the complaint with prejudice, did not explain why it withheld

leave to amend. The lesser standard, abuse of discretion, therefore applies.”). In the instant case,

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Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

a motion for leave to amend was never properly filed and therefore the abuse of discretion standard

applies.

       Leave to amend a complaint should be freely given when justice so requires after a

responsive pleading has been filed. Fed. R. Civ. P. 15(a); Foman v. Davis, 371 U.S. 178, 182

(1962); Kottmyer v. Maas, 436 F.3d 684, 692 (6th Cir. 2006). It is an abuse of discretion for the

district court to deny a plaintiff leave to amend his complaint without any justifying reason. Foman,

371 U.S. at 182. When the reasons for denying a motion to amend are readily apparent, however,

it is not a per se abuse of discretion for the district court to omit its reasons. Troxel Mfg. Co. v.

Schwinn Bicycle Co., 489 F.2d 968, 970 (6th Cir. 1973). A district court does not abuse its

discretion if it denies a plaintiff permission to amend his complaint without reason when the plaintiff

has already amended once and then subsequently fails to file a proper motion justifying another

amendment. Pulte Homes, 648 F.3d at 305; see also Begala v. PNC Bank Ohio Nat’l Ass’n, 214

F.3d 776, 784 (6th Cir. 2000) (holding that “the [district] court did not permit Plaintiffs to amend

the complaint because they did not [properly] move to do so” and that was not an abuse of

discretion).

       Although the district court did not respond or grant leave to amend in this case, the

Mellentines were previously granted an opportunity to amend of which they failed to take advantage.

Furthermore, they did not file a motion requesting such leave. We therefore conclude that the district

court did not abuse its discretion in failing to rule on the Mellentines’ informal request.




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Andrew Mellentine, et al. v. Ameriquest Mortgage Company, et al.

                                       VI. Conclusion

       For the foregoing reasons, we REVERSE the district court’s grant of Defendant Orlans’s

Rule 12(b)(6) motion to dismiss with respect to the FDCPA claim and REMAND for proceedings

not inconsistent with this opinion; we REVERSE the district court’s grant of Defendant Chase’s

Rule 12(c) motion for judgment on the pleadings with respect to the RESPA claim and REMAND

for proceedings not inconsistent with this opinion; and we AFFIRM the grant of Defendants’

remaining motions.




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