IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

Patrick Inorio, 

 Plaintiff, 

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) 

) 

) 

) 

v. ) 

)

) 

No. 20-cv-3157 

Wells Fargo Bank, N.A. 

Defendant. 

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)

)

) 

Memorandum Opinion and Order 

 Plaintiff Patrick Inorio is a borrower under a mortgage loan 

on a property located in Bartlett, Illinois. Defendant Wells Fargo 

Bank, N.A. (“Wells Fargo”) was the servicer of the loan. Mr. 

Inorio brings the instant action against Wells Fargo for purported 

violations of the Real Estate Settlement Procedures Act, 12 U.S.C. 

§ 2601 et seq. (“RESPA”), for violations of the Bankruptcy Code, 

and under several state-law theories for relief. Wells Fargo has 

moved to dismiss the six-count complaint in its entirety [16]. 

For the reasons that follow, the motion to dismiss is granted in 

part and denied in part. 

I. 

In reviewing the sufficiency of a complaint pursuant to a 

motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), 

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I “accept all well pled facts as true and draw all permissible 

inferences in favor of the plaintiff.” Agnew v. Nat’l Collegiate 

Athletic Ass’n, 683 F.3d 328, 334 (7th Cir. 2012). To survive a 

motion to dismiss, the complaint must state a claim “that is 

plausible on its face” after conclusory allegations are 

disregarded. W. Bend Mut. Ins. Co. v. Schumacher, 844 F.3d 670, 

675 (7th Cir. 2016) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678–

79 (2009)). 

In 2009, Mr. Inorio signed a thirty-year promissory note for 

$274,346 with Wells Fargo, secured by a mortgage on his residence 

in Bartlett, Illinois. ECF No. 1-1. Mr. Inorio fell behind on 

his mortgage, and on April 27, 2012, he filed a petition for relief 

under Chapter 13 of the Bankruptcy Code. See In re Inorio, No. 12 

B 17295 (Bankr. N.D. Ill. Apr. 27, 2012); ECF No. 17 at 76. Wells 

Fargo filed a proof of claim on September 10, 2012 asserting that 

Mr. Inorio was in arrears in the amount of $20,265.42, and that 

the total amount of the secured claim was $279,977.58. 

On March 13, 2017, the bankruptcy trustee filed a notice of 

final cure payment under Bankruptcy Rule 3002.1(f). ECF No. 17 at 

61. Wells Fargo filed a response in which it agreed that Mr. 

Inorio had cured its prepetition default, but asserted that Mr. 

Inorio was not current on postpetition payments. Id. at 64. On 

June 29, 2017, the bankruptcy court entered a discharge order 

providing: “If the trustee has filed and served a notice pursuant 

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to Bankruptcy Rule 3002.1(f), and no statement is timely filed by 

the mortgagee in response, the mortgage addressed by the notice is 

deemed to be fully current as of the date of the notice.” Id. at 

72. 

Mr. Inorio asserts that after the discharge, Wells Fargo 

attempted to collect real estate taxes from tax years 2013 through 

2016 in the amount of $42,350.43, as well as property insurance in 

the amount of $6,150. ECF No. 1 ¶¶ 103-04. He argues that this 

was improper because Wells Fargo did not file any notices of postpetition mortgage fees, expenses, and charges covering real estate 

tax or insurance pursuant to Federal Rule of Bankruptcy Procedure 

3002.1(c), so those fees, if any, were discharged in the 

bankruptcy. Mr. Inorio provides that over a period of 17 months, 

from December 2017 to July 2019, he made periodic payments to Wells 

Fargo in the aggregate amount of $24,681.62, but those funds were 

not posted to Mr. Inorio’s account and remain in the possession of 

Wells Fargo (although Wells Fargo is no longer the loan’s 

servicer). ECF No. 1 ¶¶ 34, 109. 

On December 4, 2017, Mr. Inorio (through counsel) sent three 

separate letters titled “Request for Information Pursuant to 12 

CFR § 1024.36” to Wells Fargo seeking information about the loan 

including, for example, the name of the owner of the loan, loss 

mitigation available for the loan, and the amount necessary to pay 

the loan in full. ECF No. 1-2. Mr. Inorio alleges that “Wells 

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Fargo failed to provide written notice to Plaintiff containing or 

consisting of an[y] substantive response to any of the requests 

contained within the RFIs [Requests for Information] within the 

applicable statutory deadlines.” ECF No. 1 ¶ 24. When Wells Fargo 

failed to respond, on February 27, 2018, Mr. Inorio sent a “Notice 

of Error under 12 CFR Section 1024.35” asserting that Wells Fargo 

had erred both by failing to respond to the RFIs and by attempting 

to collect real estate taxes and insurance paid during the 

bankruptcy proceeding. ECF No. 1-3. On August 22, 2018, Mr. 

Inorio sent a second Notice of Error (“NOE”) asserting that Wells 

Fargo had erred by failing to provide timely, substantive responses 

to the first NOE or any of the RFIs. ECF No. 1-4. 

II. 

 In Counts I and II, Mr. Inorio asserts violations of RESPA 

and its implementing regulation, Regulation X, for Wells Fargo’s 

failure to respond to the three RFIs (Count I) and the two NOEs 

(Count II). See 12 U.S.C. § 2605(k)(1); 12 C.F.R. § 1024.36 

(governing required responses to RFIs); 12 C.F.R. § 1024.35 

(governing required responses to NOEs). Wells Fargo argues that 

Mr. Inorio’s claims fail because Mr. Inorio failed to allege 

damages.1 RESPA provides that a servicer is liable for “any actual 

 

1 Wells Fargo withdrew without prejudice arguments regarding the 

content of its responses after it became clear that there was a 

factual dispute regarding whether Wells Fargo responded at all. 

See ECF No. 28 at 4. 

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damages to the borrower as a result of a failure” to comply with 

RESPA’s provisions. 12 U.S.C. § 2605(f)(1)(A). Accordingly, 

“[f]ailure to plead actual damages is fatal to a RESPA claim.” 

Golbeck v. Johnson Blumberg & Assocs., LLC, No. 16-cv-6788, 2017 

WL 3070868, at *10 (N.D. Ill. July 19, 2017) (citing Lesniak v. 

Bank of Am., N.A., 169 F. Supp. 3d 766, 773 (N.D. Ill. 2015)). 

 Mr. Inorio asserts that because Wells Fargo did not respond 

to the RFIs, he was forced to “incur[] fees and costs to have 

counsel prepare and send NOE #1 on his behalf.” ECF No. 1 ¶ 56. 

Similarly, because Wells Fargo did not respond to NOE #1, Mr. 

Inorio incurred the expenses to send NOE #2. See id. ¶¶ 36, 72. 

Wells Fargo argues that Mr. Inorio’s asserted costs of preparing 

the NOEs do not qualify as damages sufficient to maintain a RESPA 

claim. But the only case Wells Fargo cites in support, Baez v. 

Specialized Loan Servicing, LLC, concerned the costs of sending an 

initial RFI, which costs the court excluded because they were not 

causally connected the alleged RESPA violation: “the postage cost 

to the borrower [would be] the same” whether the servicer’s 

response was deficient under RESPA or not. 709 F. App’x 979, 983 

(11th Cir. 2017). Mr. Inorio, in contrast, is claiming the costs 

of preparing subsequent NOEs, which he specifically alleges “would 

not have been necessary but for Wells Fargo’s failure to properly 

respond” to prior requests. See ECF No. 1 ¶ 56. Such damages are 

sufficient to state a claim under RESPA. See Tanasi v. 

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CitiMortgage, Inc., 257 F. Supp. 3d 232, 271 (D. Conn. 2017) 

(declining to dismiss RESPA claims asserting “damages stemming 

from the preparation of later requests, or of notices of error 

that [plaintiffs] would not have needed to prepare but for 

[servicer’s] alleged violations”); see also Fowler v. Bank of Am., 

Corp., 747 F. App’x 666, 671 (10th Cir. 2018) (“[I]f [servicer’s] 

nonresponse or inadequate response prompted [plaintiffs] to resend 

a QWR [qualified written request], then the costs of preparing the 

subsequent QWR are indeed traceable to the violation [as actual 

damages].”). 

 Separately, with respect to Count II, Mr. Inorio alleges he 

was damaged when Wells Fargo “fail[ed] to correct the errors 

noticed through the NOEs or . . . otherwise timely and properly 

respond” because Wells Fargo continued to collect and retain the 

funds at issue. See ECF No. 1 ¶¶ 34, 77. Such allegations also 

state a cause of action under RESPA. See Renfroe v. Nationstar 

Mortg., LLC, 822 F.3d 1241, 1246-47 (11th Cir. 2016) (“When a 

plaintiff plausibly alleges that a servicer violated its statutory 

obligations [under RESPA] and as a result the plaintiff did not 

receive a refund of erroneous charges, she has been cognizably 

harmed.”); Marais v. Chase Home Fin. LLC, 736 F.3d 711, 720 (6th 

Cir. 2013) (complaint stated RESPA claim where allegations 

suggested that “because [servicer] failed to correct or 

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investigate the misapplied payments, [plaintiff] paid interest on 

a higher principal balance than she should have”). 

 Because Mr. Inorio alleged actual damages, I decline to 

dismiss Count I or Count II. 

III. 

 Mr. Inorio claims in Count III that Wells Fargo breached the 

note and mortgage contract by “failing to properly account for 

Plaintiff’s payments.” ECF No. 1 ¶¶ 82-83. He alleges that 

periodically for 17 months, from December 2017 to July 2019, he 

paid Wells Fargo an aggregate sum of $24,681.62, but these funds 

were not posted to his account, and “remain in the possession of 

Wells Fargo and were not turned over to the subsequent servicer.” 

Id. ¶ 34. 

 In the motion to dismiss, Wells Fargo points to provisions of 

the mortgage that allow the servicer some freedom regarding when 

and how collected funds must be applied. In particular, it points 

to Section 1 of the mortgage, which provides: 

Lender may accept any payment or partial payment 

insufficient to bring the Loan current, without waiver 

of any rights . . . , but Lender is not obligated to 

apply such payments at the time such payments are 

accepted. . . . Lender may hold such unapplied funds 

until Borrower makes payment to bring the Loan current. 

If Borrower does not do so within a reasonable period of 

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time, Lender shall either apply such funds or return 

them to Borrower. If not applied earlier, such funds 

will be applied to the outstanding principal balance 

under the Note immediately prior to foreclosure. 

ECF No. 1-1 at 4. Wells Fargo seems to suggest that this provision 

allowed it to retain the $24,681.62 at issue. To the contrary, 

however, this language allows Wells Fargo to retain payments only 

for “a reasonable period of time” before those funds must be 

applied or returned. Mr. Inorio alleges that Wells Fargo has 

retained his funds without applying them for, in the case of the 

earliest periodic payments, more than three years, including after 

Wells Fargo was no longer the servicer of the loan. That is enough 

to state a claim that Wells Fargo has retained the funds in breach 

of contract. See Int'l Prod. Specialists, Inc. v. Schwing Am., 

Inc., 580 F.3d 587, 597 (7th Cir. 2009) (“What constitutes a 

reasonable time [under a contract] given the facts of the case is 

. . . a question of fact . . . .”). Accordingly, Count III may 

proceed. 

IV. 

In Count IV, Mr. Inorio claims a violation of the Illinois 

Consumer Fraud and Deceptive Practices Act (“ICFA”), 815 Ill. Comp. 

Stat. 505/2. Specifically, he alleges that Wells Fargo used 

“fraud, deception, and misrepresentation in their attempts to 

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collect funds [that] were uncollectible under the Bankruptcy 

Code.” ECF No. 1 ¶ 92. 

Wells Fargo argues that Count IV must be dismissed because it 

is preempted by the Bankruptcy Code. I agree. “State law claims 

are preempted if they ‘arise under’ the Bankruptcy Code, are 

‘related to’ a bankruptcy case, or ‘arise in’ bankruptcy.” 

Sylvester v. Select Portfolio Servicing, Inc., No. 18 C 5860, 2019 

WL 3573577, at *1 (N.D. Ill. Aug. 6, 2019) (citing In re Repository 

Techs., Inc., 601 F.3d 710, 719 (7th Cir. 2010)). “The expansive 

reach of the Code preempts virtually all claims related to alleged 

misconduct in the bankruptcy courts.” Cox v. Zale Del., Inc., No. 

97 C 4464, 1998 WL 397841, at *5 (N.D. Ill. July 13, 1998). A 

claim that “goes beyond violations of the Code,” or allows for 

relief that “would not conflict with any provision of the Code” is 

not preempted. Sylvester, 2019 WL 3573577, at *2. However, “a 

state law claim, including an ICFA claim, is preempted by the 

Bankruptcy Code when the claim would not exist but for some 

violation of the Code.” Bednar v. Pierce & Assocs., P.C., 220 F. 

Supp. 3d 860, 863 (N.D. Ill. 2016); see also Sylvester, 2019 WL 

3573577, at *1 (collecting cases). 

Here, Mr. Inorio alleges fraud in connection with Wells 

Fargo’s attempts to collect real estate taxes and insurance funds 

that “were uncollectable under the Bankruptcy Code.” ECF No. 1 

¶ 92. Clearly, absent a violation of the Bankruptcy Code, such a 

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cause of action would not exist. Accordingly, I dismiss Count IV 

as preempted. See, e.g., Sylvester, 2019 WL 3573577, at *1-2 

(finding preempted ICFA claim alleging servicer sought to collect 

amounts in excess of those plaintiff was required to pay under 

bankruptcy plan); Twomey v. Ocwen Loan Servicing, LLC, No. 16-cv0918, 2016 WL 4429895, at *2-3 (N.D. Ill. Aug. 22, 2016) 

(dismissing as preempted claim that post-discharge collection 

efforts violated the ICFA).2

V. 

 Count V is styled “Violation of the Bankruptcy Discharge, the 

Confirmed Chapter 13 Plan and Federal Rule of Bankruptcy Procedure 

3002.1.” ECF No. 1 at 19. Mr. Inorio contends that Wells Fargo’s 

attempts to collect the real estate taxes and property insurance 

amounts violated both the bankruptcy discharge and Federal Rule of 

Bankruptcy Procedure 3002.1. 

 Wells Fargo argues that a violation of the Bankruptcy Rules 

is not a stand-alone federal claim. ECF No. 28 ¶ 11. I agree. 

 

2 In his response, Mr. Inorio also attempts to assert additional 

grounds for his ICFA claim: that Wells Fargo was fraudulent with 

respect to “administration of the settlement,” ECF No. 25 at 10, 

that Wells Fargo “included incorrect versions of IRS Forms 1098 

and 1099,” id., and that Wells Fargo “failed to apply funds and 

held the funds for its own benefit,” id. at 14. None of these 

bases were included in the complaint, however, and therefore cannot 

be used to oppose the motion to dismiss. See Montoro v. United 

States, No. 93 C 7237, 1994 WL 91937, at *2 (N.D. Ill. Mar. 17, 

1994) (“It is axiomatic that a plaintiff cannot amend his complaint 

through a memorandum in response to a motion to dismiss.”). 

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Indeed, neither a violation of a Bankruptcy Rule nor of a Chapter 

13 Plan states an independent cause of action. See, e.g., Long v. 

Bank of Am., N.A., No. 17 CV 2756, 2018 WL 5830794, at *5 (N.D. 

Ill. Nov. 7, 2018) (claim asserting violation of plan of 

reorganization dismissed due to lack of private cause of action);

Smith v. Keycorp Morg., Inc., 151 B.R. 870, 875-76 (N.D. Ill. 1993) 

(finding no private right of action for alleged violation of 

Chapter 13 Plan); see also Berkley v. Wells Fargo Bank, No. 15-

CV-00749-JSC, 2015 WL 13413346, at *1 (N.D. Cal. June 23, 2015) 

(“[T]he Court dismisses the third cause of action because 

Plaintiffs err in bringing an alleged violation of a Federal Rule 

of Bankruptcy Proceeding as a separate cause of action.”); Raymark 

Indus., Inc. v. Baron, No. CIV. 96-7625, 1997 WL 359333, at *8 

(E.D. Pa. June 23, 1997) (claim for violation of Federal Rule of 

Bankruptcy Procedure “cannot stand as an independent cause of 

action”). 

 Nor am I able to entertain Mr. Inorio’s claim to the extent 

it asserts a violation of the bankruptcy discharge. “‘A debtor 

dunned after’ obtaining a discharge can ‘ask the bankruptcy judge 

to hold the other party in contempt of . . . the discharge 

injunction[,]’ [but] [t]hat is the debtor’s only remedy . . . . 

[H]e cannot file suit directly in federal district court.” Dore 

v. Five Lakes Agency, Inc., No. 14 CV 6515, 2015 WL 4113203, at *2 

(N.D. Ill. July 8, 2015) (citing Cox v. Zale Del., Inc., 239 F.3d 

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910, 916-17 (7th Cir. 2001)); accord Billups v. PHH Mortg. Corp., 

No. 19 C 5891, 2021 WL 83507, at *4 (N.D. Ill. Jan. 11, 2021); 

Gagnon v. JPMorgan Chase Bank, N.A., 563 B.R. 835, 847 (N.D. Ill. 

2017); Azari v. Seterus, Inc., No. 16-cv-3929, 2016 WL 6070361, at 

*3 (N.D. Ill. Oct. 17, 2016). 

 Accordingly, Wells Fargo’s motion to dismiss Count V is 

granted. 

VI. 

 In Count VI, Mr. Inorio claims Wells Fargo was unjustly 

enriched when it failed to post or apply the $24,681.62 collected 

following the bankruptcy discharge. ECF No. 1 ¶¶ 106-111. 

“Because it is an equitable remedy, unjust enrichment is only 

available when there is no adequate remedy at law.” Guinn v. 

Hoskins Chevrolet, 836 N.E.2d 681, 704 (Ill. Ct. App. 2005) 

(citation omitted). Thus, where the relationship between the 

parties is governed by contract, “unjust enrichment has no 

application.” Id. A plaintiff may plead breach-of-contract and 

unjust-enrichment claims in the alternative, but where unjustenrichment claims incorporate allegations of the existence of a 

contract between the parties, the unjust-enrichment claim should 

be dismissed. Gociman v. Loyola Univ. of Chi., No. 20 C 3116, 

2021 WL 243573, at *5 (N.D. Ill. Jan. 25, 2021). 

 Here, Mr. Inorio’s unjust-enrichment claim not only 

incorporates the allegations of the similar breach-of-contract 

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claim, ECF No. 1 ¶ 106, but includes a specific allegation that 

the parties’ relationship is governed by contract: “The note and 

mortgage is a contract between the Parties which requires Wells 

Fargo to . . . either apply and post payments to Plaintiff’s 

account or return those fund[s],” id. ¶ 107. Because there is an 

adequate remedy at law, Count VI is properly dismissed. 

VII. 

 For the foregoing reasons, Wells Fargo’s motion to dismiss 

[16] is denied with respect to Counts I-III granted with respect 

to Counts IV-VI. 

 ENTER ORDER: 

 ________________________ 

 Elaine E. Bucklo 

 United States District Judge 

Dated: March 1, 2021 

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