primary claim in this case it arises under the real estate settlement procedures act respa rights but was recently amended it was amended in two thousand and ten and the amended version was implemented in two thousand and fourteen my client's claims under arrest but arise under the portion of the statute that direct deal with resolution resolution and mortgage servicing my clients were the borrowers wells fargo was the mortgage servicer in this case there really can be no dispute that there was a very serious mortgaging servicing heir wells fargo brought a foreclosure lawsuit against my clients in state court and that case was pending for years and that case was brought by mistake in fact it ended with a trial a trial in state court and i'm sure a trial where the state court judge entered an order in voluntarily dismissing sent i am understanding your client's position to be that there was some default but it wasn't that the amount in controversy should have been one hundred four thousand dollars because that amount also included what was its stake in the original foreclosure action is that what your position is i mean are you is it your client's position that there was a default of some type but it just wasn't one hundred four thousand dollars worth no judge that's not our position our prayers we interpreted that letter at the time as indicating that wells fargo had at charged all the amounts originally claimed in the original foreclosure but in fact it is not our position that there was a fall and it wasn't what the state trial court found right but that was in april of two thousand and fifteen and then there was and actually what the state trial court found as i read through the transcript was that wells fargo had not proven that there had been a default as of the time i guess twenty thirteen or whatever but that doesn't mean that your clients no longer have to pay mortgage payments after that so right i mean you really think that so i think i understand you got his question better it was they were saying there was no default it was that my clients did not know in part due to the insufficient response to the first notice of the what wells fargo would expect them to pay and they expected to hear from wells fargo after the foreclosure trial was resolved in their favor and they expected that there would be some sort of a resolution to the confusion they never took the position that they didn't have to make mortgage payments did they make mortgage payments in the intervening period they did not make mortgage payments in the intervening period because they didn't know who to pay or how much to pay like after april after the april twenty fifth c f r you didn't file a notice with it an effect to get the account settled we want to find out what the status it was when you did it the first time they sent you a response that was a mile long my judgement they sent you all the records everything else they anticipated their duty under the regulation they say that regulation is read it says you can make a response to a demand for an accounting basically that's what the whole purposes and then they have to do an investigation then they have to give you a reason and tell you either there is an error or there is no where correct and then if you want documents in order th you ask for documents and i produce the documents so the arrows all documentary what they did is they have tests updated the requests for documents and they produced all of the documents everything but  date that had to do with the account that had to do with the account you never asked for anything else when you filed a lawsuit and made another request pending the lawsuit so the defense counsel simply said you can communicate october twenty one it was in october of two thousand and fifteen i toured tobar twenty two thousand and fifteen it refers basically the to the what went on in the lawsuit or prior to the lawsuit correct it doesn't my reading of and the farm said you can deal with us and that's where we are right and we had hoped that that lawsuit would have triggered the investigation and correction that was not the first and that if you don't want the documents counsel it's not documents not the you don't want the documents to show the contractual relationship between the parties that's correct we were you don't want them at all that you don't want to record of the payments made on this that  know the thing about how they were allocated no we wanted an adjustment to the county so that wells fargo would not continue to pursue collection of the amounts that had been erroneous lee pursuing so was one of the problems during the trial before the state court that there were like three different documents that purported to tell what the payments were and they were in conflict with each other and the wells fargo examiner was just not able to explain which one was correct in that one of the problems that was one of the problem and so alternately the court dismissed the foreclosure action because it found that wells fargo hadn't proven it right so is your position then that once it was dismissed you shouldn't have had to have paid for any of the at any of the interest or penalties or anything at all or back payments that were due up until the time it was dismissed is that what your position is that is our position ok and is it further than your position that in october of two thousand and fifteen when you were notified that they were foreclosing again and the notification said it was for one hundred four thousand dollars that that one hundred four thousand dollars figure included some of the penalties interest and payments that were due up to and including april fifteenth or whatever the date was in two thousand and fifteen when the state court dismissed the foreclosure action yes that is our position and so what you're seeking is to have the number from one hundred four thousand dollars explained as to what comport what comes what part of that is composed of the pre dismissal of the foreclosure and what comes from after he sat right yes that's exactly right and i want to remind the court that wells fargo denied in response to the first notice of there that there was any problem in pursuing foreclosure it said in its notice of errors spawn's that the foreclosure was valid and  due after the foreclosure the norm out in this in the two thousand and fifteen notice yes yes yes of so you want an explanation of that but you did ask your side of the letter for an explanation of that amount and then because they had already in two thousand and fourteen not only had they failed to give us an explanation but they were going forward as if there had been no air and we reminded them and i think that was i think that with the way it was presented in wells fargo's brief gets the sequence of events and accurate we reminded them in the two thousand and fifteen notice the one that we sent in october that we already notified you that there was a problem with the foreclosure in two thousand people say some time for about the red light good morning may it please the court my name is ken mello and i represent wells fargo in this matter the laws of course well settled if they service or fails to respond to a notice of error or provides and adequate response that the borrowers are entitled to actual damages and they are however entitled to the actual damages only if there is a causal link between the inadequate response and the purported damage let me just i'm sorry to interrupt but i want to make sure i have the facts straight the one hundred four thousand dollars that you all said was still outstanding in your october letter does that include amounts from before the april twenty fift state dismissal of the foreclosure action your end of the record has not been developed for me to be able to explain exactly where that number came from well yes but i mean isn't that part of the problem right i mean that's what they want to know where did that number come from it's part of the problem to the extent that in two thousand and fifteen days and their second notice of error which is it is ok they sent it then they filed a lawsuit prematurely because we hadn't even had a chance and you may well be right that it was premature i mean that but does that then excuse wells fargo from responding maybe raised two things in the two thousand and fifteen notice of their first they said it's follow up correspondence to our two thousand and fourteen did you explain where the one hundred forty thousand dollars figure came from we did not because we said you've already filed a lawsuit so that any issues dealing with our new demand letter will deal with in the existing lawsuit and that was essentially a re motivation and you'll do that with or what are we at this point we're in litigation you've already we've already for the lawsuit now well your position has to be that it was trumped by the lawsuit because otherwise you didn't comply with the c f r since you didn't provide an explanation as to the one thing they were questing which is what is the one hundred four thousand dollars composed of that i so isn't your position that it was trumped by the lawsuit or  to respond to the issue of the hundred thousand dollars you're correct we did we we didn't we did not respond because of the loss of the lead to that or reasoning was it was it was because of the lawsuit but i don't want to lose and so i am sorry but i just i just want to make sure that we follow up on this line of questioning here and you might well be right i'm not suggesting otherwise but do you have any case law or any authority which supports your position that your response that the c f r requirements were trying to buy the lawsuit no not that they were trumped we do we do not what the what the case law does is that at the point that you file a lawsuit your loss is premature the and i mean we didn't think our responsibilities were trumped because we did go ahead and and response it just didn't directly address the just scrap in the amount if you did not think that your your c f r responsibilities were trumped and you did file a response didn't there were spots have to questions where your question's going then at that point the issue and that's what i think is we're losing sight of the issue is whether as a result of that adequate response they're entitled to actual damages because but haven't we already decided that i mean there's a causal link when in renfro didn't we already decide that there is a causal link when an inadequate response is given to a problem that is raised that makes the problem current to that time i mean didn't we already decide that ok so he run for is very different from this case and  is why i run pros different what happened in rent was that the borrower was actually making payments ok over or over a period of time yes b but the plaintiffs here say they were making payments and the state court seems to have thought they were making payments because it dismissed your foreclosure action an airball of two thousand and fifteen so why isn't that the same it's not the same because the payments they made were during a very specific timeframe the payments that they made were from some point in time in february two thousand and twelve to february of two thousand and thirteen based on their own allegations they say we made some payments when we learned of the foreclosure referral we made some payments after when they sent the original two thousand and fourteen explanation sort of ignores the fact that there's this state judgment dismissing your foreclosure action in april of two thousand and fifteen so how do you fit that april twenty fifth teen dismissal of your foreclosure action into what happened here i mean it seems like you have to account for that you can't just ignore that that occurred that it is a binding judgement and you have to comply with a may explain the april fifteenth dismissal of the foreclosure action was based on the fact that we failed to approve or default not that there was no to full and that's a key that's a key distinction specially when you look at all the cases we failed to prove the default we have the right ok they have a you can keep bringing foreclosure actions until for the same period until you when you can under kenyon's it's absolutely  under for supreme court precedent never the same period not for the same period and that's not what we write and that's that's what i'm trying to find out from you what did that one hundred four thousand dollars cover did it cover that period for which the foreclosure action was dismissed that i don't i mean it's outside the record i don't know but isn't that exactly the problem because that is precisely the question that was being asked in the q w r in the why does the one they asked the question about the hundred four thousand in the october twenty level letter yes filed suit the next day i under the regulation that letter of october twenty third the responsibility to run this business about how to run an investigation to determine whether the hundred four thousand was correct and that they would ask for documents was all cut off by the lawsuit but even that's essentially the position that we took an current ok but in many time there's been no foreclosure action since october two thousand and fifteen right now what occurred was we sent a new demand letter saying your end of fault we're it's outside the record ok but isn't that sort of a problem for the so how do you put all that together there's the second cue are two days later they file a lawsuit and then the record kind of just comes to an end and so there's nothing in the record to show that any damages flowed from the second w r if there's if the foreclosures suit is outside the lawsuit well i mean that yes i mean that is a problem but the problem with trying to link damages to the two thousand and fifteen two w r is paid what the plaintiff's argument is is that it was followup correspondence that's and it was filed seven months after dismissal i mean once that involuntary dismissal was entered there was no basis for follow up related to the two to two thousand and fourteen she did you are those issues were over we had to retreat to then proceed with our demand letter and seek a new foreclosure action for their for their failure to pay which i mean it's now up five over five years that they failed to make a payment so my colleague seemed very focused on the second q w r but i have some questions about the first q w r and the resolution in the foreclosure action so are we to assume that the resolution of the foreclosure action and washed out all the damages that might have stemmed from the first q w r i think their position is pursuant to the first or in response to the first q w are there should have been a correction that there was not one hundred four thousand plus i owed there should have been a correction and mike and they would say my client has suffered certain damages beyond what was covered in the foreclosure action that we're entitled to that we can prove like emotional distress damages there might be some other elements of damage actual damage that are recoverable under arrest as a result of the first the response of the first the failure to correct after the first  are so what do you say about that will they essentially are seeking four types of actual damages stemming from the two thousand and fourteen q are the first damages that they're seeking position that it right there just there what about the other element for a double for a double recovery as to the finance charges that they're seeking a number of points first in the complaint  itself allegations of course must be accepted as true in the context of a motion to dismiss they essentially state that the fine it charges and interest flowed from the improper failure to credit borrowers payment not from the failure to respond to the q w r so even their own allegations dual link don't link the finance charges to the failure to respond to but they did tell you i mean isn't that the whole problem because what they're asking for when they say that they were that they come from the failure to credit the payments and they've asked you to and they've told you in the q w are that the accounting was incorrect that's exactly what they're doing they're linking it together even if the court wants to read it that way their claim still fails and it still fails because what they're saying is they're saying that they believe they were assessed versus incurred and if you look back at room for a witch i think why  maybe that the judge should have allowed leave time and for instance on the issue of damage to credit rating they concludes are really alleged damage to credit rating right and there is case law that says you have to do more than that but maybe there should have been an opportunity to amend to give to allow them to explain that more that they applied for credit and were rejected because of a report made by wells fargo or something like that and i certainly and i certainly understand the question but i think here if they had they knew the facts if they had them they would have pled and they have to plead a plausible claim not a it's our an argument here that the court dismissed it without leave to him and certainly there is i don't know it did you make the fact that i don't recall though it being in the brief as an argument somewhere before us on that point lawsuit was based on an inadequate response to the two thousand and fourteen notice of are you telling us there is no two thousand and fifteen issue in this case when we amended you know you sent a letter on october twenty there's nothing in the record in response to their lot and i thought that point now what we have is a complaint and in order to specify the amended complaint right oh but there was a long period of time between the date the complaint was filed in the procedural posture was we filed the complaint wells fargo answered the complaint they did not move to dismiss it we went through discovery after discovery we moved for leave to amend the complaint so the first time the court addressed the sufficien allegations it was dealing with the amended complaint it was never any ruling on this efficiency of the initial complaint ok i think we have your point and