UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

JAMES W. RYAN and DENISE R. RYAN,

Plaintiffs, Case No. 15-11555

vs. Hon. Gerald E. Rosen

OCWEN LOAN SERVICING, LLC, and

DEUTSCHE BANK NATIONAL TRUST

COMPANY, as TRUSTEE UNDER THE

POOLING AND SERVICING AGREEMENT

DATED AS OF JUNE 1, 2003, MORGAN

STANLEY ABS CAPITAL I INC. 

TRUST 2003-HE1,

Defendants.

 /

OPINION AND ORDER GRANTING

DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

At a session of said Court, held in

the U.S. Courthouse, Detroit, Michigan

on March 30, 2016 

PRESENT: Honorable Gerald E. Rosen

United States District Judge

I. INTRODUCTION

Plaintiffs James W. and Denise R. Ryan commenced this suit in state court on

or around April 2, 2015, asserting federal and state-law claims against Defendants

Ocwen Loan Servicing, LLC and Deutsche Bank National Trust Company arising

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 1 of 15 Pg ID 607
from the September 3, 2014 foreclosure sale of Plaintiffs’ home on Woodlawn

Drive in Flint, Michigan. Defendants removed the case to this Court on April 29,

2015, citing Plaintiffs’ assertion of a claim arising under federal law, as well as the

diverse citizenship of the parties. See 28 U.S.C. §§ 1331, 1332(a) 1441(a).

Through the present motion filed on November 30, 2015, Defendants seek an

award of summary judgment in their favor on each of the claims asserted in

Plaintiffs’ complaint. In support of this motion, Defendants point to a variety of

purported defects in Plaintiffs’ claims as pled,1

 and they further contend that

Plaintiffs have failed to unearth any evidentiary support for their claims in the

course of the discovery period. To the contrary, Defendants observe that by virtue

of Plaintiffs’ failure to respond to a number of requests for admissions served by

Defendants in the course of discovery, Plaintiffs are foreclosed from establishing

certain key elements of their claims.

Plaintiffs have responded, after a fashion, to Defendants’ pending motion for

summary judgment,2

 and Defendants have filed a reply in further support of their

1

In light of these claimed defects, Defendants filed a motion for judgment on the

pleadings on July 20, 2015, shortly after the commencement of the discovery period. 

While this motion remains pending, it has been rendered moot in light of the Court’s

ruling on the present motion for summary judgment.

2

As Defendants observe, the brief filed by Plaintiffs in response to Defendants’

present motion is essentially identical to the brief they filed in opposition to Defendants’

earlier motion for judgment on the pleadings. As befitting a response to an attack upon

2

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 2 of 15 Pg ID 608
motion. Having reviewed the parties’ briefs in support of and in opposition to

Defendants’ motion, as well as the remainder of the record, the Court finds that the

pertinent facts, allegations, and legal issues are adequately presented in these

written submissions, and that oral argument would not assist in the resolution of this

motion. Accordingly, the Court will decide Defendants’ motion “on the briefs.” 

See Local Rule 7.1(f)(2), U.S. District Court, Eastern District of Michigan. For the

reasons set forth below, the Court readily concludes that Defendants’ motion should

be granted, and that Plaintiffs’ complaint should be dismissed in its entirety with

prejudice.

II. FACTUAL AND PROCEDURAL BACKGROUND

In January of 2003, Plaintiffs James W. and Denise R. Ryan granted a

mortgage on property located on Woodlawn Drive in Flint, Michigan (the

“Property”) to non-party American Nationwide Mortgage Company, Inc., as

security for a loan in the amount of $105,000.00. On or around March 14, 2003,

this mortgage was assigned to Defendant Deutsche Bank National Trust Company,

as Trustee under the Pooling and Servicing Agreement dated as of June 1, 2003,

the pleadings, Plaintiffs’ present submission (i) is wholly lacking in citations to the

evidentiary record, (ii) asserts at various points that Plaintiffs’ claims have been

adequately pled, without regard for the question whether these claims have any

evidentiary support, and (iii) recites the standards of Fed. R. Civ. P. 12(b)(6) as

purportedly governing the Court’s review of Defendants’ motion. In light of this

response, it is fair to say that Defendants’ present motion is effectively unopposed.

3

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 3 of 15 Pg ID 609
Morgan Stanley ABS Capital I Inc. Trust 2003-HE1. At all pertinent times,

Defendant Ocwen Loan Servicing, LLC was the servicer of the mortgage.

Several years later, Plaintiffs defaulted on their obligations under the

mortgage, and foreclosure proceedings were commenced in March of 2014. Soon

thereafter, Plaintiffs retained the services of non-party Home Legal Group, PLLC to

assist them in seeking mortgage assistance and obtaining a modification of their

mortgage loan, but they have admitted during discovery that they never submitted a

complete loss mitigation application to Defendants. (See Complaint at ¶¶ 11-12;

Defendants’ Motion, Ex. D, Requests for Admission No. 10.)3

 Nonetheless,

Defendants evaluated Plaintiffs’ eligibility for mortgage assistance based on the

information available to them, and Plaintiffs were notified on May 1, 2014 that they

did not qualify for a loan modification. (See Defendants’ Motion, Ex. G, 5/1/2014

Letter; Ex. D, Requests for Admission No. 5.)

A sheriff’s sale was conducted on September 3, 2014, and Defendant

Deutsche Bank purchased the Property for $106,534.22. (See Defendants’ Motion,

3

As noted earlier, Plaintiffs failed to respond to any of the requests for admissions

served by Defendants during discovery, despite the entry of an October 1, 2015 stipulated

order granting Plaintiffs additional time to do so. Accordingly, by operation of Fed. R.

Civ. P. 36(a)(3), Plaintiffs are deemed to have admitted each of the matters addressed in

Defendants’ requests for admissions. Plaintiffs have not sought relief from the operation

of Rule 36(a)(3), nor did they so much as mention this resulting predicament in their

response to Defendants’ present motion. 

4

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 4 of 15 Pg ID 610
Ex. E, Sheriff’s Deed.) Plaintiffs had until March 3, 2015 to redeem the Property,

but they did not do so.

Instead, Plaintiffs commenced the present suit in state court on April 2, 2015,

alleging that Defendants failed to consider their request for a loan modification, and

asserting a number of federal and state-law claims arising from this alleged failure. 

Defendants timely removed the case to this Court on April 29, 2015, and they now

argue that they are entitled to an award of summary judgment in their favor as to

each of the claims asserted in Plaintiffs’ complaint. 

III. ANALYSIS

A. The Standards Governing Defendants’ Motion

Through their present motion, Defendants seek summary judgment in their

favor on each of the claims asserted by Plaintiffs. Under the pertinent Federal Rule

governing this motion, summary judgment is proper “if the movant shows that there

is no genuine dispute as to any material fact and the movant is entitled to judgment

as a matter of law.” Fed. R. Civ. P. 56(a). As the Supreme Court has explained,

“the plain language of Rule 56[] mandates the entry of summary judgment, after

adequate time for discovery and upon motion, against a party who fails to make a

showing sufficient to establish the existence of an element essential to that party’s

case, and on which that party will bear the burden of proof at trial.” Celotex Corp.

5

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 5 of 15 Pg ID 611
v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 2552 (1986).

In deciding a motion brought under Rule 56, the Court must view the

evidence “in a light most favorable to the party opposing the motion, giving that

party the benefit of all reasonable inferences.” Smith Wholesale Co. v. R.J.

Reynolds Tobacco Co., 477 F.3d 854, 861 (6th Cir. 2007). Yet, the nonmoving

party may not rely on bare allegations or denials, but instead must support a claim

of disputed facts by “citing to particular parts of materials in the record, including

depositions, documents, electronically stored information, affidavits or declarations,

stipulations . . . , admissions, interrogatory answers, or other materials.” Fed. R.

Civ. P. 56(c)(1)(A). Moreover, “[a] mere scintilla of evidence is insufficient” to

withstand a summary judgment motion; rather, “there must be evidence on which

the jury could reasonably find for the non-moving party.” Smith Wholesale, 477

F.3d at 861 (internal quotation marks and citation omitted).4

B. Defendants Have Established as a Matter of Law That They Did Not

Violate RESPA, and That the Relief Sought by Plaintiffs as a Result of

Any Such Alleged Violation Is Unavailable in Any Event.

4

As noted earlier, Plaintiffs’ response to Defendants’ present motion utterly fails to

meet these standards for properly opposing a Rule 56 request for summary judgment. In

particular, Plaintiffs do not cite to any materials whatsoever in the evidentiary record,

much less claim that this record gives rise to genuine issues of material fact. In essence,

then, Defendants’ present motion is unopposed, particularly in light of the facts that are

deemed admitted as a result of Plaintiffs’ failure to respond to Defendants’ requests for

admissions. Consequently, the Court will move rather quickly through its analysis of the

issues raised in Defendants’ motion.

6

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 6 of 15 Pg ID 612
In count I of their complaint, Plaintiffs allege that Defendants violated the

federal Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2601 et

seq., and one or more federal regulations by (i) failing to properly evaluate the loss

mitigation requests submitted by Plaintiffs and their representatives, (ii) failing to

provide the appropriate written notice of the actions taken on these requests and the

loan modification options available to Plaintiffs, and (iii) instead proceeding with

the foreclosure sale of the Property. As Defendants point out in their motion,

however, the federal claims asserted in count I of the complaint are both factually

unsupported and legally deficient.

First, Plaintiffs’ allegations in support of their claimed violations of RESPA

and its corresponding federal regulations are defeated by virtue of the admissions

made by Plaintiffs during discovery. In particular, Plaintiffs have admitted (i) that

they did not send a complete loss mitigation application to Defendants, (ii) that

Defendants nonetheless evaluated them for all available loss mitigation options, and

(iii) that Defendant Ocwen sent them a May 1, 2014 letter explaining the grounds

for the denial of Plaintiffs’ request for a loan modification. (See Defendants’

Motion, Ex. D, Requests for Admission Nos. 4, 5, 10, 11; Ex. G, 5/1/2014 Letter.) 

In light of these admissions, Plaintiffs cannot establish their entitlement to recover

under RESPA.

7

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 7 of 15 Pg ID 613
Next, Plaintiffs have failed as a matter of law to establish their entitlement to

any of the forms of relief sought in count I of their complaint. To the extent that

they seek to set aside the sheriff’s sale of the Property, this form of relief is

unavailable to them under RESPA and its associated regulations. See Servantes v.

Caliber Home Loans, Inc., No. 14-13324, 2014 WL 6986414, at *1 (E.D. Mich.

Dec. 10, 2014). In addition, while Plaintiffs seek an award of monetary damages,

they have admitted that they suffered no actual damages relating to the allegations

of their complaint, (see Defendants’ Motion, Ex. D, Requests for Admission No.

12), and a RESPA claim cannot succeed absent proof of actual damages, see Battah

v. ResMAE Mortgage Corp., 746 F. Supp.2d 869, 876 (E.D. Mich. 2010). Finally,

Plaintiffs’ allegation of a violation of 12 C.F.R. § 1024.38 is unavailing, because

there is no private right of action to enforce any such violation. See Smith v.

Nationstar Mortgage, No. 15-13019, 2015 WL 7180473, at *4 (E.D. Mich. Nov.

16, 2015).

8

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 8 of 15 Pg ID 614
C. Plaintiffs’ Claim of Negligence Fails for Lack of a Duty Owed by

Defendants Apart from Their Contractual Obligations, and for Lack of

Evidence of Damages.

Count II of Plaintiffs’ complaint asserts a state-law claim of negligence,

based on allegations that the Defendant loan servicer, Ocwen, violated a purported

duty to exercise reasonable care in evaluating Plaintiffs’ request for a loan

modification. Defendants argue, and the Court agrees, that this claim fails because

(i) Defendants did not owe a duty of care to Plaintiffs that was separate and distinct

from their contractual obligations under the mortgage and note, and (ii) Plaintiffs

admit that they suffered no damages as a result of any purported breach of any such

duty of care.

Under well-settled Michigan law, where the relationship between the parties

is governed by a contract, there can be no tort liability unless the plaintiff alleges

and proves the “violation of a legal duty separate and distinct from” the obligations

owed by the defendant under the contract. Rinaldo’s Construction Corp. v.

Michigan Bell Telephone Co., 454 Mich. 65, 559 N.W.2d 647, 658 (1997); see also

Fultz v. Union-Commerce Associates, 470 Mich. 460, 683 N.W.2d 587, 592 (2004). 

Under facts similar to those alleged here, the courts have held that a loan servicer

does not owe a duty of care to a borrower to evaluate a request for a loan

modification, whether under the regulations enacted pursuant to the federal Home

9

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 9 of 15 Pg ID 615
Affordable Modification Program (“HAMP”) or by virtue of the borrower/lender

relationship. See Rush v. Freddie Mac, 792 F.3d 600, 605-06 (6th Cir. 2015);

Polidori v. Bank of America, N.A., 977 F. Supp.2d 754, 763-64 (E.D. Mich. 2013);

Ahmad v. Wells Fargo Bank, NA, 861 F. Supp.2d 818, 826-28 (E.D. Mich. 2012). 

As explained by the Sixth Circuit, “the duties established by the mortgage contract

govern the relationship between the parties,” and “a homeowner who has defaulted

may not simply waive the contract and sue in negligence.” Rush, 792 F.3d at 605

(footnote omitted).

Even assuming that Plaintiffs were able to identify a duty owed by one of the

Defendants that would support a tort claim under Michigan law, they have failed as

a matter of law to establish one or more of the required elements of their claim of

negligence. First, they have admitted that Defendants evaluated their eligibility for

all available loss mitigation options, and that Defendant Ocwen sent them a letter

explaining the reasons why their request for a loan modification had been denied. 

(See Defendants’ Motion, Ex. D, Requests for Admission Nos. 4, 5.) Next,

Plaintiffs’ claim of negligence requires proof of damages, see Polidori, 977 F.

Supp.2d at 763, but they have admitted that they have not suffered any actual

damages relating to the allegations of their complaint, (see Defendants’ Motion, Ex.

D, Requests for Admission No. 12).

10

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 10 of 15 Pg ID 616
D. Plaintiffs’ Claim of Wrongful Foreclosure Fails for Lack of Evidence of

Defects in the Foreclosure Process or Prejudice They Suffered as a

Result of These Alleged Defects.

In count III of their complaint, Plaintiffs have asserted a claim of wrongful

foreclosure, and they ask that the Court set aside the September 3, 2014 sheriff’s

sale of the Property. Yet, under well-settled case law, once the statutory period of

redemption expires — as it did here on March 3, 2015, before Plaintiffs commenced

the present suit — the courts may “only entertain the setting aside of a foreclosure

sale where the mortgagor has made a clear showing of fraud, or irregularity.” 

Conlin v. Mortgage Electronic Registration Systems, Inc., 714 F.3d 355, 359 (6th

Cir. 2013) (internal quotation marks and citations omitted); see also Rush, 792 F.3d

at 603; Narra v. Fannie Mae, No. 13-12282, 2014 WL 505571, at *5 (E.D. Mich.

Feb. 7, 2014). Moreover, “not just any type of fraud will suffice. Rather, the

misconduct must relate to the foreclosure procedure itself.” Conlin, 714 F.3d at 360

(internal quotation marks, alteration, and citations omitted); see also Rush, 792 F.3d

at 603.

Although Plaintiffs allege in their complaint that Defendant Ocwen “failed to

properly follow the requirements of the foreclosure process” as defined under

Michigan law, (Complaint at ¶ 43), they have failed to produce any evidence in

support of this allegation. Nor have they produced evidence, or even alleged, that

11

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 11 of 15 Pg ID 617
any of the purported defects in this process rose to the level of fraud or misconduct. 

Defendants, in contrast, have produced evidence that notices of the sheriff’s sale

were properly published and posted in accordance with Michigan law, (see

Defendants’ Motion, Ex. E), and they also point to Plaintiffs’ admissions that the

foreclosure of the mortgage and sheriff’s sale were proper in all respects, and that

they have no grounds to dispute the validity of the sheriff’s sale, (see Defendants’

Motion, Ex. D, Requests for Admission Nos. 14, 18).

Even assuming Plaintiffs had produced evidence of irregularities in the

foreclosure process, the Michigan Supreme Court has held that such “defects or

irregularities in a foreclosure proceeding result in a foreclosure that is voidable, not

void ab initio.” Kim v. JPMorgan Chase Bank, N.A., 493 Mich. 98, 825 N.W.2d

329, 337 (2012). The Court further explained that to set aside a foreclosure sale on

the basis of such a defect or irregularity, a plaintiff must show that he was

prejudiced by the defendant’s failure to comply with the foreclosure statute, and

that “to demonstrate such prejudice,” the plaintiff “must show that [he] would have

been in a better position to preserve [his] interest in the property absent [the]

defendant’s noncompliance with the statute.” Kim, 825 N.W.2d at 337 (footnote

with citations omitted); see also Rush, 792 F.3d at 603; Conlin, 714 F.3d at 361-62. 

As Defendants correctly observe, Plaintiffs cannot make this requisite showing of

12

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 12 of 15 Pg ID 618
prejudice, where they have admitted that they lacked the financial ability to either

cure their default under the mortgage prior to the sheriff’s sale or redeem the

Property following the sheriff’s sale. (See Defendants’ Motion, Ex. D, Requests for

Admission Nos. 2, 3.) 

E. Plaintiffs Have Failed as a Matter of Law to Establish One or More of

the Elements of Their Breach of Contract Claim.

Next, Plaintiffs have asserted a breach of contract claim in count IV of their

complaint, alleging that Defendant Ocwen breached an implied covenant of good

faith and fair dealing imposed under the note and mortgage. (See Complaint at ¶¶

47-48.) As Defendants correctly observe, however, “Michigan . . . does not

recognize a claim for breach of an implied covenant of good faith and fair dealing.” 

Smith, 2015 WL 7180473, at *3. In addition, Defendants point to the absence of

any provisions in the note or mortgage that would require them to grant Plaintiffs a

loan modification or to process a request for mortgage assistance in any particular

way. Finally, this claim, like several others asserted in the complaint, is defeated by

Plaintiffs’ admission that they did not suffer any damages relating to any alleged

breach of Defendants’ contractual duties. (See Defendants’ Motion, Ex. D,

Requests for Admission No. 12.)

F. Plaintiff’s Claim of Fraudulent Misrepresentation Is Barred by

Michigan’s Statute of Frauds, and Also Lacks Evidentiary Support.

13

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 13 of 15 Pg ID 619
In the fifth and final count of their complaint, Plaintiffs assert a claim of

fraudulent misrepresentation against Defendant Ocwen, alleging that this Defendant

made various misrepresentations concerning Plaintiffs’ request for a loan

modification and the timing of any foreclosure proceedings. In seeking summary

judgment in their favor on this claim, Defendants first point to Plaintiffs’ failure to

produce any writing signed by an authorized representative of either Defendant that

promised either to grant a loan modification or to delay or cease foreclosure

proceedings concerning the Property. To the contrary, Plaintiffs have admitted that

no such writing exists. (See Defendants’ Motion, Ex. D, Requests for Admission

No. 17.) Absent allegations of a promise made in writing and signed by a

representative of one of the Defendants, “[c]ourts in this District have repeatedly

held that misrepresentation claims based on alleged promises to modify home

mortgages are barred by the Michigan Statute of Frauds.” Loeffler v. BAC Home

Loans Servicing, L.P., No. 11-13711, 2012 WL 666750, at *5 (E.D. Mich. Feb. 29,

2012) (citing cases).

In any event, Plaintiffs have not produced evidence of any fraudulent

statements made to them by either Defendant. Again, they have admitted precisely

the contrary — i.e., that Defendants made no misleading statements to them. (See

Defendants’ Motion, Ex. D, Requests for Admission No. 15.) They have further

14

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 14 of 15 Pg ID 620
admitted that they suffered no damages as a result of any alleged

misrepresentations. (See id., Requests for Admission No. 12.) It follows that they

cannot prove one or more of the required elements of their claim of fraudulent

misrepresentation.

IV. CONCLUSION

For the reasons set forth above,

NOW, THEREFORE, IT IS HEREBY ORDERED that Defendants’

November 30, 2015 motion for summary judgment (docket #25) is GRANTED. In

light of this ruling, IT IS FURTHER ORDERED that Defendants’ July 20, 2015

motion for judgment on the pleadings (docket #11) is DENIED as moot.

s/Gerald E. Rosen 

United States District Judge

Dated: March 30, 2016

I hereby certify that a copy of the foregoing document was served upon the parties

and/or counsel of record on March 30, 2016, by electronic and/or ordinary mail.

s/Julie Owens 

Case Manager, (313) 234-5135

15

2:15-cv-11555-GER-DRG Doc # 29 Filed 03/30/16 Pg 15 of 15 Pg ID 621