1

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW JERSEY

LAURIE JANE HAYES,

Plaintiff,

 v.

WACHOVIA MORTGAGE, FSB f/k/a 

World Savings Banks, et al.,

 Defendants.

11-CV-1622

 

OPINION

This matter comes before the Court on a Federal Rule of Civil Procedure 

12(b)(6) motion to dismiss filed by defendant Wells Fargo Bank, N.A. (“Wells 

Fargo”). Plaintiff Laurie Jane Hayes sued a predecessor of Wells Fargo, and other 

defendants, in New Jersey state court asserting violations of the Truth in Lending 

Act, 15 U.S.C. § 1601 et seq. (“TILA”), and bringing other claims under state law. 

Wells Fargo removed the action against it to this Court; the other defendants have 

not appeared. 

For the reasons below, the Court will grant the motion to dismiss in part, 

dismiss Hayes’s TILA claims, and decline to exercise supplemental jurisdiction 

over the remaining claims. 

I. Background

In 2007, Hayes retained defendant Franklin First Financial, LTD. as a broker 

to aid her in finding a refinance loan. On October 10, 2007, acting on her broker’s 

recommendation, Hayes closed on a refinance loan with Wachovia Mortgage FSB, 

f/k/a World Savings Bank. Defendant Allwood Title Agency, Inc. acted as the 

settlement agent at the closing. Sometime thereafter, Wells Fargo acquired 

Wachovia Mortgage FSB, and the two companies merged.

On July 7, 2010, Hayes filed an action in the Law Division of the Superior 

Court of New Jersey, Essex County, against the above-named defendants and John 

Does I-X. On July 13, 2010, she filed the Amended Complaint, alleging violations 

of TILA, violations of the New Jersey Home Ownership Security Act, N.J. Stat. 

Ann. 46:10-B-22, et seq., violation of the New Jersey Consumer Fraud Act, N.J. 

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Stat. Ann. 56:8-2, et seq., fraud, and breach of fiduciary duty. The crux of the 

Amended Complaint is that the defendants failed to make necessary disclosures, 

ignored other state law prohibitions regarding lender actions, and otherwise 

induced Hayes to enter into the loan agreement on terms advantageous to the 

defendants and disadvantageous to her. In August of 2010, Hayes attempted 

improper service on Wells Fargo. On December 7, 2010, the Clerk of the Superior 

Court entered default against Wells Fargo.

On March 22, 2011, Wells Fargo removed the action against it to this Court 

pursuant to 28 U.S.C. §§ 1331, 1441(b) and (c), and 1446. Wells Fargo then 

moved to set aside the entry of default against it, and Hayes consented thereto. On 

April 23, 2011, this Court set aside the entry of default. On June 22, 2011, Wells 

Fargo moved to dismiss all the claims against it. The time to respond to the motion 

has passed, and Hayes has not filed a response.

II. Legal Analysis

A. Legal Standard

In deciding a motion to dismiss under Rule 12(b)(6), a court must take all 

allegations in the complaint as true and view them in the light most favorable to the 

plaintiff. See Warth v. Seldin, 422 U.S. 490, 501 (1975); Trump Hotels & Casino 

Resorts, Inc. v. Mirage Resorts Inc., 140 F.3d 478, 483 (3d Cir. 1998). This 

assumption of truth is inapplicable, however, to legal conclusions couched as 

factual allegations or to “[t]hreadbare recitals of the elements of a cause of action, 

supported by mere conclusory statements.” Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 

(2009).

Although a complaint need not contain detailed factual allegations, “a 

plaintiff’s obligation to provide the ‘grounds’ of his ‘entitlement to relief’ requires 

more than labels and conclusions, and a formulaic recitation of the elements of a 

cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). 

Thus, the factual allegations must be sufficient to raise a plaintiff’s right to relief 

above a speculative level, such that it is “plausible on its face.” See id. at 570; see 

also Umland v. PLANCO Fin. Serv., Inc., 542 F.3d 59, 64 (3d Cir. 2008). 

Furthermore, a claim has “facial plausibility when the plaintiff pleads factual 

content that allows the court to draw the reasonable inference that the defendant is 

liable for the misconduct alleged.” Iqbal, 129 S.Ct. at 1949 (2009) (citing 

Twombly, 550 U.S. at 556). While “[t]he plausibility standard is not akin to a 

‘probability requirement’ . . . it asks for more than a sheer possibility.” Iqbal, 129 

S.Ct. at 1949 (2009).

When deciding a motion to dismiss under Rule 12(b)(6), a court typically 

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must limit its review to the pleadings. See, e.g., Hart v. Electronic Arts, Inc., 740 F. 

Supp. 2d 658, 662-63 (D.N.J. Sep. 22, 2010). But where the complaint explicitly 

refers to or relies upon a document, and the defendant attaches an undisputedly 

authentic copy of that document as an exhibit to a motion to dismiss, the Court 

may consider that document in deciding the motion under the incorporation by 

reference doctrine. Id. (citing In re Burlington Coat Factory Sec. Litig., 114 F.3d 

1410, 1426 (3d Cir. 1997)). Wells Fargo has attached copies of certain TILA 

documents that were signed by Hayes as exhibits to its motion to dismiss: a 

document marked “Federal Truth in Lending Disclosure Required by Regulation 

Z” (“TILA Disclosure”), attached as Exhibit H, and a document marked “Notice of 

Right to Cancel – General” (“NRC”), attached as Exhibit J. Paragraphs 12 and 51

of the Amended Complaint explicitly refer to these documents, and Hayes’s claims 

under TILA rely on their content. Hayes has not objected to these exhibits nor has 

she cast doubt on their authenticity. As such, this Court may properly consider 

these exhibits without converting the motion to dismiss into one for summary 

judgment. See, e.g., Kemp v. American Home Mortg. Servicing, Inc., 2010 WL 

456770, at *2 (E.D. Cal. Feb. 3, 2010) (finding that court may consider TILA 

documents referred to in complaint under incorporation by reference doctrine). The 

Court will not consider the other documents attached to the motion.

B. Plaintiff’s TILA Claims

Hayes alleges three specific violations of TILA: first, that the defendants 

failed to provide her with two copies of the notice of her right to cancel the 

transaction; second, that the defendants failed to accurately disclose the finance 

charges associated with the closing; and third, that the disclosures she did receive 

were untimely. Hayes prays for relief in the form of damages and rescission. 

Unfortunately for Hayes, all of her claims arising under TILA are time-barred.

The one-year statute of limitations provided by 15 U.S.C. § 1640(e) bars any 

claim for damages Hayes could bring under TILA. In re Community Bank of 

Northern Virginia, 622 F.3d 275, 303 (3d Cir. 2010). The limitations period begins 

to run on the day of the occurrence of the violation – in this case, from the closing 

of the loan. Id. at 303-304. Hayes alleges she closed the loan on or about October 

10, 2007, but she did not file her complaint until July 7, 2010 – well over a year 

after the closing. 

Similarly, the three-day period provided by 15 U.S.C. § 1635(a) bars any 

claim for rescission. Granted, 15 U.S.C. § 1635(f) creates an extended three-year 

statute of repose that is available when the lender has failed to make the material 

disclosures required by TILA. Chiles v. Ameriquest Mortg. Co., 551 F. Supp. 2d. 

393, 396 (E.D. Pa. 2008). But review of the NRC and the TILA Disclosure 

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confirms that Hayes received the necessary disclosures.1 As such, she cannot avail 

herself of the extended three-year statute of repose. Id. She did not seek to rescind 

her loan until she filed her first complaint, on July 7, 2010 – well past the three-day 

limit.

C. Supplemental Jurisdiction

While the TILA claims are active, this Court has supplemental jurisdiction

over the remaining state-law claims, all of which are related to the same common 

nucleus of facts giving rise to the alleged TILA violations. See 28 U.S.C. § 

1367(a). But once the Court dismisses the TILA claims, the Court must decide 

whether to exercise supplemental subject-matter jurisdiction over the pendent state 

law claims. The Third Circuit Court of Appeals “has recognized that, ‘where the 

claim over which the district court has original jurisdiction is dismissed before 

trial, the district court must decline to decide the pendent state claims unless 

considerations of judicial economy, convenience, and fairness to the parties 

provide an affirmative justification for doing so.’” Hedges v. Musco, 204 F.3d 109, 

123 (3d Cir. 2000) (quoting Borough of West Mifflin v. Lancaster, 45 F.3d 780, 

788 (3d Cir. 1995)). The Court sees no reasons why any considerations of judicial 

economy, convenience, or fairness to the parties would provide an affirmative 

justification for exercising supplemental jurisdiction in this case. This is especially 

true here, where the action against the majority of the defendants is still before the 

state court. The state court – from which Wells Fargo removed this action – would 

presumably be able to deal with the remaining state law issues. And so, the Court 

should remand the remaining state law claims under 28 U.S.C. § 1367(c)(3).

 1 A brief review of the TILA Disclosure confirms that it contains the necessary information about finance charges 

required by TILA and its implementing regulations. And, despite her allegations to the contrary, review of the NRC 

reveals that Hayes acknowledged receiving the required two copies of that document. See Palmer v. GMAC 

Commercial Mortg., 628 F. Supp. 2d 186, 192-93 (D.D.C. 2009). The documents also make plain that she received 

them on October 10, 2007, the day of the closing. Thus, there is no violation arising from the timeliness of the 

disclosures. See Ngwa v. Castle Point Mortg., 2008 WL 3891263, at *7 (S.D.N.Y. Aug. 20, 2008) (no extension of 

right to rescind where plaintiff received TILA disclosures at closing). In any event, Hayes signed both the NRC and 

the TILA Disclosure, thereby creating a rebuttable presumption that she received the necessary disclosures. See 

Jefferies v. Ameriquest Mortg. Co., 543 F. Supp. 2d 368, 381 n. 17 (E.D. Pa. 2008) (citing 15 U.S.C. § 1635(c) and 

holding that “[w]hen a consumer acknowledges in writing that she has received the [TILA] disclosures, the 

acknowledgment creates a rebuttable presumption that the lender delivered the required disclosures.”).

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III. Conclusion 

For the foregoing reasons, the Court dismisses Count VI of the Complaint, 

Plaintiff’s TILA claims, and declines to exercise supplemental jurisdiction over the 

remaining state law claims. The Court remands the remaining state law claims to 

the Law Division of the New Jersey Superior Court, Essex County. An appropriate 

order follows.

 /s/ William J. Martini 

WILLIAM J. MARTINI, U.S.D.J.

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