IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 17-11429

CHRISTIANA TRUST, A DIVISION OF WILMINGTON SAVINGS FUND 

SOCIETY, FSB, AS TRUSTEE,

 Plaintiff,

v.

MARY SUE RIDDLE, 

 Defendant Third Party Plaintiff – Appellant,

v.

BANK OF AMERICA, N.A., 

 Third Party Defendant – Appellee.

Appeal from the United States District Court

for the Northern District of Texas

Before KING, ELROD, and HAYNES, Circuit Judges.

∗

JENNIFER WALKER ELROD, Circuit Judge:

Mary Sue Riddle, who took out a home-equity loan from Bank of 

America, alleges that the bank is vicariously liable for the failure of the bank’s 

 

∗ Judge Haynes concurs in the judgment of affirmance and agrees with the reasoning 

of Section II.A. She would not reach the issue in Section II.B, so she does not join in the 

alternative holding.

United States Court of Appeals

Fifth Circuit

FILED

December 21, 2018

Lyle W. Cayce

Clerk

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loan servicer to comply with the Real Estate Settlement Procedures Act 

(RESPA). The district court dismissed Riddle’s claims under Rule 12(b)(6). We 

affirm for two independent reasons. First, Riddle did not plead an agency 

relationship between Bank of America and the loan servicer, an essential 

element of a vicarious liability claim. Second, even if Bank of America had an 

agency relationship with the loan servicer, the bank cannot be held vicariously 

liable, as a matter of law, for the servicer’s alleged RESPA violations.

I.

In December 2006, Mary Sue Riddle executed a home-equity note with 

Bank of America for a loan of $127,000. To secure her obligations on the note, 

Riddle executed a security instrument—a Homestead Lien Contract and Deed 

of Trust on her property in San Angelo, Texas—in favor of Bank of America. 

In September 2012, Bank of America sent a letter to Riddle stating that Ocwen 

Loan Servicing, LLC (Ocwen), would start servicing the loan.1 In January 

2015, Bank of America assigned the loan, including the security interest in 

Riddle’s property, to Christiana Trust, a division of the Wilmington Savings 

Fund Society. In April 2015, Ocwen notified Riddle that BSI Financial

Services (BSI) would take over as the new loan servicer.

In October 2016, Christiana Trust filed a complaint against Riddle for 

judicial foreclosure of her property, alleging that Riddle had failed to make 

payments on the note. In response, Riddle filed an answer, counterclaims

against Christiana Trust, and a third-party complaint against Ocwen, BSI, and

Bank of America. Bank of America responded to Riddle’s complaint with a 

Rule 12(b)(6) motion to dismiss. Riddle then filed both an amended complaint

 

1 Generally, loan servicers take care of “the administrative aspects of a loan.” Loan 

Servicing, Investopedia (Mar. 26, 2018), https://www.investopedia.com/terms/l/

loan_servicing.asp. This includes “sending monthly payment statements and collecting 

monthly payments,” as well as “maintaining records of payments and balances.” Id.

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against the same third-party defendants and a response in opposition to Bank 

of America’s motion to dismiss the original third-party complaint. The 

amended complaint—like the original one—includes, as relevant for this 

appeal,2 claims under the Real Estate Settlement Procedures Act (RESPA), a 

federal statute that governs the procedures of mortgage loans. Bank of 

America quickly moved to dismiss the amended third-party complaint, too. In 

her response opposing this second motion to dismiss, Riddle clarified her 

RESPA theory against Bank of America, alleging that “Ocwen was [Bank of 

America’s] servicing agent” and that Bank of America “is vicariously liable for 

[Ocwen’s] RESPA violations.”

The district court dismissed all of Riddle’s claims against Bank of 

America with prejudice.3 Soon after, Riddle filed a motion for reconsideration, 

which the district court denied. Riddle then filed a notice of interlocutory 

appeal.4

 

2 Riddle’s amended third-party complaint includes claims for breach of contract, 

violations of the Texas Debt Collection Practices Act, violations of the Fair Debt Collection 

Practices Act, violations of RESPA, negligent misrepresentation, and equitable relief, and 

she also sued to quiet title. In her response to Bank of America’s motion to dismiss the 

amended third-party complaint, however, she clarified that she was asserting claims against 

the bank only for breach of contract and vicarious liability for the RESPA violations of the 

bank’s loan servicer. Riddle does not contest the district court’s dismissal of her breach of 

contract claim, so this appeal concerns only the dismissal of her RESPA claims against Bank 

of America.

3 The district court denied Bank of America’s motion to dismiss the original thirdparty complaint because it was moot in light of Riddle’s filing of the amended one.

4 The appeal is interlocutory because the district court has not yet resolved all the 

claims raised against all parties. We have jurisdiction under 28 U.S.C. § 1291 because the 

district court designated its dismissal of the claims against Bank of America as a final 

judgment and expressly determined that there was no just reason for delay. See Judgment 

Pursuant to Rule 54(b), Christiana Trust v. Riddle, No. 6:16-CV-59-C (N.D. Tex. Oct. 16, 

2017), ECF No. 38; see also Fed. R. Civ. P. 54(b) (“When an action presents more than one 

claim for relief . . . or when multiple parties are involved, the court may direct entry of a final 

judgment as to one [party] . . . only if the court expressly determines that there is no just 

reason for delay.”).

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II.

We review a district court’s dismissal under Rule 12(b)(6) de novo. 

Sullivan v. Leor Energy, LLC, 600 F.3d 542, 546 (5th Cir. 2010). We may 

affirm the dismissal of a claim on any ground made manifest by the record 

below. See id. We affirm the district court’s dismissal for two independent 

reasons. First, Riddle’s amended third-party complaint fails to plead that 

Bank of America had an agency relationship with either Ocwen or BSI, an 

essential element of her vicarious liability theory. Second, as a matter of law, 

Bank of America cannot be held vicariously liable for the alleged RESPA 

violations of its loan servicer—regardless of whether the servicer is Bank of 

America’s agent.

A.

“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.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic 

Corp. v. Twombly, 550 U.S. 544, 570 (2007)); Hinojosa v. Livingston, 807 F.3d 

657, 683–84 (5th Cir. 2015). Riddle’s claim for relief, as articulated on appeal,

asserts that Bank of America is vicariously liable for Ocwen’s violations of 12 

C.F.R. § 1024.41(c)(1). The Consumer Financial Protection Bureau (CFPB) 

promulgated this regulation pursuant to its rulemaking authority under 

RESPA. See 12 U.S.C. § 2605(k)(1)(E) (conferring this authority). The

regulation imposes duties on servicers who “receive[] a complete loss 

mitigation application more than 37 days before a foreclosure sale.” 12 C.F.R. 

§ 1024.41(c)(1). When a servicer receives such an application,5 the servicer 

 

5 “A loss mitigation application is simply a request by a borrower for any of a number 

of alternatives to foreclosure, known as loss mitigation options, including, among others, 

modification of the mortgage.” Lage v. Ocwen Loan Servicing LLC, 839 F.3d 1003, 1006 (11th 

Cir. 2016). 

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must—within thirty days of receiving the application—“evaluate the borrower 

for all loss mitigation options available to the borrower” and “provide the 

borrower with a notice . . . stating the servicer’s determination of which loss 

mitigation options, if any, it will offer the borrower[.]” Id.

Riddle asserts that Ocwen and BSI received timely loss-mitigation

applications but failed to consider them and notify Riddle of her loss-mitigation 

options.6 Specifically, Riddle alleges the following in her amended third-party 

complaint:

44. Third-Party Defendants, Ocwen and BSI failed to comply with 

their RESPA obligations under 12 C.F.R. § 1024.41. Specifically, 

Ocwen and BSI violated 12 C.F.R. § 1024.41(c) because they 

received a complete or facially complete loss mitigation 

applications [sic] at least 37 days before a scheduled foreclosure 

sale, and yet failed to consider Mary for all loss mitigation options 

and notify Mary in writing of all loss mitigation options available 

to her.

See Counter-Plaintiff/Third-Party Plaintiff’s First Amended Counterclaim and 

Third-Party Complaint at 12, Christiana Trust, No. 6:16-CV-59-C (N.D. Tex. 

Apr. 6, 2017), ECF No. 28. 

Noticeably absent from this part of the pleading is any reference to Bank 

of America. In opposition to Bank of America’s motion to dismiss, Riddle 

claims that we should overlook this omission because “Ocwen was [Bank of 

America’s] servicing agent” and Bank of America “is vicariously liable for the 

RESPA violations of its servicing agent.” Her amended third-party complaint

does reference vicarious liability principles generally: she states that 

 

6 Riddle clarifies on appeal that Bank of America is vicariously liable “so long as it 

continues to own the loan” and that the bank relinquished ownership of the loan before BSI 

took over as the servicer. For this reason, we do not look to Paragraph 45 of the complaint—

which alleges further violations of 12 C.F.R. § 1024.41 only against BSI and Christiana Trust, 

based on conduct occurring after the assignment of the loan—for potential claims against 

Bank of America.

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“mortagees [sic] can be vicariously liable for the RESPA violations of their 

servicers.” The beginning of the complaint also states that whenever she 

alleges that a “Third-Party Defendant did, or failed to do” something, she 

means either (1) that the defendant itself did or failed to do it; or (2) that the 

defendant’s “agents, officers, servants, employees, vice principals, or 

representatives” did or failed to do it and the defendants are liable under 

respondeat superior.

But Riddle’s theory of vicarious RESPA liability theory requires pleading 

facts that suggest an agency relationship between Bank of America and either 

Ocwen or BSI. Meyer v. Holley, 537 U.S. 280, 285 (2003) (“It is well established 

that traditional vicarious liability rules ordinarily make principals or 

employers vicariously liable for acts of their agents or employees in the scope 

of their authority or employment.”) (emphasis added). To determine whether 

an agency relationship exists, the Supreme Court looks to the Restatement of 

Agency, which requires both the principal’s control over the agent and both 

parties’ consent to the agent’s acting on the principal’s behalf. Id. at 286; see 

also Restatement (Third) of Agency § 1.01 cmt. f(1) (2006) (“An essential 

element of agency is the principal’s right to control the agent’s actions. . . . The

power to give interim instructions distinguishes principals in agency 

relationships from those who contract to receive services provided by persons 

who are not agents.”).

Riddle’s amended third-party complaint alleges no such facts. Her 

statement that “mortagees [sic] can be vicariously liable for the RESPA 

violations of their servicers,” sheds no light on the particular relationship 

between Bank of America and the two loan servicers. And her general 

respondeat superior statement at the beginning of the complaint runs in only 

one direction, telling us to read her allegations against principals to include 

allegations against agents—not vice versa. She never pleads a RESPA 

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violation by Bank of America, the putative principal, so this section does not 

help her. Without facts suggesting an agency relationship, even if everything 

Riddle alleges in her complaint is true, her complaint does not “state a 

[RESPA] claim” against Bank of America at all—let alone one that is “plausible 

on its face.” Hinojosa, 807 F.3d at 683–84 (quoting Iqbal, 556 U.S. at 678). 

Accordingly, we affirm the district court’s dismissal on this basis.

B. 

Even if Riddle had pleaded facts suggesting such a relationship, we hold 

in the alternative7 that the district court appropriately dismissed her RESPA

claim for another reason: Bank of America, as a matter of law, is not vicariously 

liable for the alleged RESPA violations of its servicers. This is an issue of first 

impression in our circuit, and we are apparently the first circuit court to 

address it.

By its plain terms, the regulation at issue here imposes duties only on 

servicers. 12 C.F.R. § 1024.41(c)(1) (“[A] servicer shall . . .”) (emphasis added); 

see also 12 U.S.C. § 2605(i)(2), (i)(3) (defining a servicer as the “person 

responsible” for “receiving any scheduled periodic payments from a borrower 

. . . and making the payments of principal and interest and such other 

payments with respect to the amounts received from the borrower as may be 

required pursuant to the terms of the loan”). A loan servicer’s obligation to 

follow this regulation derives from RESPA itself, which also confines this 

 

7 “This circuit follows the rule that alternative holdings are binding precedent and not 

obiter dictum.” Texas v. United States, 809 F.3d 134, 178 n. 158 (5th Cir. 2015) (quoting 

United States v. Potts, 644 F.3d 233, 237 n. 3 (5th Cir. 2011)), aff’d by an equally divided 

Court, 136 S. Ct. 2271 (2016); see also United States v. Reyes-Contreras, No. 16-41218, 2018 

WL 6253909, at *7 n. 19 (5th Cir. Nov. 30, 2018) (en banc).

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obligation to servicers alone.8 Specifically, the statute provides that “a servicer

of a federally related mortgage shall not . . . fail to comply with any other 

obligation found by the Bureau of Consumer Financial Protection, by 

regulation, to be appropriate to carry out the consumer protection purposes of 

this chapter.” 12 U.S.C. § 2605(k)(1)(E) (emphasis added); see also

Amendments to the 2013 Mortgage Rules, 78 Fed. Reg. 60,382, 60,384 (Oct. 1, 

2013) (citing this statutory provision, among others, as the authority for the 

regulation that Ocwen and BSI allegedly violated). RESPA’s answer on the 

ultimate question of § 2605 liability is similarly limited. The statute prescribes 

that “[w]hoever fails to comply with any provision of this section shall be liable 

to the borrower for each such failure[.]” 12 U.S.C. § 2605(f). Because only

“servicers” can “fail to comply” with 12 U.S.C. § 2605(k)(1)(E), only servicers 

can be “liable to the borrower” for those failures. 12 U.S.C. § 2605(f). The text 

squarely settles the issue. See Aviles v. Merit Systems Protection Bd., 799 F.3d 

457, 465 (5th Cir. 2015) (“Because we conclude that the text of the amended 

statute . . . supports the Board’s interpretation, we need not [analyze 

further].”).

When Congress chose to impose RESPA duties more broadly, it did so

clearly and explicitly. The statute’s prohibition on kickbacks and unearned 

fees states that “no person” shall engage in the forbidden conduct. 12 U.S.C. 

§ 2607; see also Hawk v. Carrington Mortgage Services, LLC, No. 3:14-CV1044, 2016 WL 4433665, at *2 (M.D. Pa. Aug. 17, 2016) (explaining this 

interpretive reasoning). But Congress chose a narrower set of potential 

defendants for the violations that Riddle alleges here. The difference matters. 

“When Congress includes particular language in one section of a statute but 

 

8 Riddle did not plead, and she does not argue on appeal, that Bank of America acted 

as a servicer itself. So this case turns entirely on whether Bank of America can be held 

vicariously—not directly—liable. 

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omits it in another,” we “presume[] that Congress intended a difference in 

meaning.” Digital Realty Trust, Inc. v. Somers, 138 S. Ct. 767, 777 (2018) 

(Ginsburg, J.) (alteration omitted) (quoting Loughrin v. United States, 134 S. 

Ct. 2384, 2390 (2014)); see also, e.g., Asadi v. G.E. Energy (USA), L.L.C., 720 

F.3d 620, 626 (5th Cir. 2013) (“The use of the term ‘whistleblower,’ as compared 

with terms such as ‘individual’ or ‘employee,’ is significant.”); King v. St. 

Vincent’s Hospital, 502 U.S. 215, 220–21 (1991) (“Given the examples of 

affirmative limitations on reemployment benefits conferred by neighboring 

provisions, we infer that the simplicity of subsection (d) was deliberate.”); In re 

Burnett, 635 F.3d 169, 172 (5th Cir. 2011) (interpreting a statute—which

forbade government agencies from “deny[ing] employment to” a person in 

bankruptcy but prohibited private employers merely from “terminat[ing] the 

employment” of such a person—to allow private employers to deny employment 

to someone in bankruptcy); Antonin Scalia & Bryan A. Garner, Reading Law: 

The Interpretation of Legal Texts 170 (2012) (“[A] material variation in terms 

suggests a variation in meaning.”). 

Most of the district courts that have reached this issue agree with our 

reading of the statute. See, e.g., Hawk, No. 3:14-CV-1044, 2016 WL 4433665, 

at *2; Green v. Cent. Mortg. Co., No. 3:14-CV-04281 LB, 2015 WL 7734213, at 

*15 (N.D. Cal. Dec. 1, 2015); Bennett v. Nationstar Mortg., LLC, No. CV 15-

00165-KD-C, 2015 WL 5294321, at *10 (S.D. Ala. Sept. 8, 2015); McAndrew v. 

Deutsche Bank Nat’l Trust Co., 977 F. Supp. 2d 440, 445 (M.D. Pa. 2013). The 

main case espousing a contrary view is Rouleau v. US Bank, NA, an 

unpublished opinion from the District of New Hampshire. No. 14-CV-568 JL, 

2015 WL 1757104, at *7 (D. N.H. Apr. 17, 2015). The Rouleau court reasoned 

that RESPA creates “a species of tort liability.” Id. (citing City of Monterey v. 

Del Monte Dunes at Monterey, Ltd., 526 U.S. 687, 709 (1999)). The court 

observed that “when Congress creates a tort action, it legislates against a legal 

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background of ordinary tort-related vicarious liability rules.” Id. (quoting 

Meyer, 537 U.S. at 285). Unless Congress has “expressed a contrary intent,” 

its statutorily created torts “incorporate those rules.” Id. (quoting Meyer, 537 

U.S. at 285, 287). Seeing no contrary congressional intent, the Rouleau court 

concluded that RESPA incorporates principles of vicarious liability.

We decline to adopt Rouleau’s reasoning because it falls short even on its 

own terms. Congress did express an intent contrary to the incorporation of 

traditional vicarious liability rules. 12 U.S.C. § 2605(f) defines the parameters 

of § 2605 liability: “[w]hoever fails to comply with any provision of this section” 

is liable. This legislatively prescribed definition—which makes parties 

responsible solely for their own failures to comply—fundamentally conflicts 

with traditional vicariously liability, which imputes liability “based on the 

tortious acts of another.” Restatement (Third) of Torts § 13 (2000) (emphasis 

added). Congress could have imposed § 2605 liability on “whoever fails to 

comply or whoever has hired an agent who fails to comply.” It could have 

imposed liability on “whoever would be liable under traditional principles of 

tort law.” It could have said nothing at all, perhaps leaving the common law 

as a gap filler. It could have imposed the statutory duty to ensure compliance 

with the CFPB’s regulations not only on loan servicers, but also on lenders. 

But Congress did none of those things. 

“The preeminent canon of statutory interpretation requires us to 

presume that the legislature says in a statute what it means and means in a 

statute what it says there.” Asadi, 720 F.3d at 622 (quoting BedRoc Ltd. v. 

United States, 541 U.S. 176, 183 (2004)) (internal quotation marks and 

alterations omitted). If a statute’s text is “plain and unambiguous, it must be 

given effect.” BMC Software, Inc. v. C.I.R., 780 F.3d 669, 674 (5th Cir. 2015) 

(quoting Kelly v. Boeing Petroleum Servs., Inc., 61 F.3d 350, 362 (5th Cir. 

1995)); see also United States v. Ary, 892 F.3d 787, 789 (5th Cir. 2018) (“Our 

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inquiry begins with the statutory text, and ends there as well if the text is 

unambiguous.”) (quoting BedRoc, 541 U.S. at 183) (alterations omitted). The 

text of this statute plainly and unambiguously shields Bank of America from 

any liability created by the alleged RESPA violations of its loan servicer. 

Accordingly, we affirm the district court’s dismissal on this basis.

III.

The allegations of RESPA violations in Riddle’s complaint fail to even 

mention Bank of America—let alone allege the agency relationship that her 

vicarious liability theory requires. Accordingly, we AFFIRM the district court’s 

dismissal on this basis. And even if Riddle had pleaded such an agency 

relationship, the text of the regulation and statute at issue here plainly and 

unambiguously shields Bank of America from any liability arising from its loan 

servicer’s alleged RESPA violations. Accordingly, we alternatively AFFIRM 

the district court’s dismissal on this independent basis as well.

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