NOT FOR PUBLICATION

UNITED STATES DISTRICT COURT

DISTRICT OF NEW JERSEY

 :

AMY HERZOG, : CIVIL ACTION NO. 11-4571 (MLC)

 :

Plaintiff, : MEMORANDUM OPINION

 :

v. :

 :

INDYMAC BANK, FSB, et al., :

 :

Defendants. :

 :

COOPER, District Judge

Plaintiff, Amy Herzog, commenced this action in New Jersey

Superior Court against Defendants, IndyMac Bank, FSB (“IndyMac”),

OneWest Bank, FSB (“OneWest”), and Goldman Sachs Mortgage Company

(“GSMC”), alleging violations of the Truth in Lending Act, 15

U.S.C. § 1601, et seq. (“TILA”), the Real Estate Settlement

Procedures Act, 12 U.S.C. § 2601, et seq. (“RESPA”), and the New

Jersey Consumer Fraud Act, N.J.S.A. § 56:8-1, et seq. (“NJCFA”). 

(Dkt. entry no. 1, Rmv. Not., Ex. 1, Compl.) OneWest and GSMC

(“Moving Defendants”) now move to dismiss the Complaint pursuant

to Federal Rule of Civil Procedure (“Rule”) 12(b)(6), arguing

that Herzog fails to state any claim upon which relief can be

granted. (Dkt. entry no. 5, Mot. Dismiss.) Herzog opposes the

motion. (Dkt. entry no. 14, Opp’n Br.)

The Court will address the motion without oral argument

pursuant to Local Civil Rule 78.1(b) and, for the reasons set

forth below, will grant the motion in part.

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BACKGROUND

As alleged in the Complaint, Herzog accepted a $500,000 loan

(“the Loan”) from IndyMac on July 21, 2006. (See Compl. at ¶ 1.) 

In exchange for the Loan, Herzog executed a note in favor of

IndyMac at an initial interest rate of 7.75% per annum and with

initial monthly payments of $3,229.17. (Id.; Compl., Ex. A,

Note.) She also executed a mortgage on real property located at

8 Davenport Drive in Princeton Junction, New Jersey. (Compl. at

¶ 2; Compl., Ex. B, Mortg.) Herzog alleges that IndyMac failed

to provide Herzog with either an initial or a final Uniform

Residential Loan Application (“URLA”). (Compl. at ¶ 3.)

The Court takes judicial notice that the United States

Department of the Treasury, Office of Thrift Supervision closed

IndyMac on or about July 11, 2008, and appointed the Federal

Deposit Insurance Corporation (“FDIC”) as its receiver. See

Murdock v. E. Coast Mortg. Corp., No. 10-4717, 2011 WL 3611394,

at *2 (D.N.J. Aug. 17, 2011). Herzog accordingly alleges that

OneWest is the current servicer and that GSMC is the current

investor on the Loan. (Compl. at ¶ 5.)

Through the Complaint, Herzog raises three claims against

IndyMac, OneWest, and GSMC. First, she alleges that IndyMac’s

failure to provide an URLA constitutes a violation of RESPA. 

(Id. at ¶ 3.) Second, she alleges that the Loan was predatory

because it “provided for negative amortization without properly

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informing Herzog of what this entailed.” (Id. at ¶ 4.) Herzog

thus alleges that Defendants violated TILA, and that TILA

violation, in turn, constitutes a violation of NJCFA. (Id. at ¶

4.) Finally, Herzog alleges that, under NJCFA, the Loan

“constituted an unconscionable commercial practice, deception,

fraud, false pretense, false promise or misrepresentation against

Herzog,” based upon “improper disclosures” and failure to provide

“proper documentation and disclosures”. (Id. at ¶¶ 9-10.)

Moving Defendants removed the action to this Court and, as

noted above, now move to dismiss the Complaint pursuant to Rule

12(b)(6). (Rmv. Not.; Mot. Dismiss.) They argue that Herzog 1

has failed to set forth a claim under RESPA and that, even if

such a claim had been properly raised, it would be barred by the

applicable statute of limitations. (Dkt. entry no. 5-1, Defs.

Br. at 6-9.) They also argue that Herzog’s TILA claim is barred

by the applicable statute of limitations. (Id. at 5-6.) Herzog

does not directly respond to Moving Defendants’ argument that she

failed to state a claim under RESPA. She does, however, argue

that the Court should effectively extend the limitations periods

 Because neither IndyMac nor the FDIC received service in 1

this matter, their consent was not required to remove the action

to this Court. See, e.g., Brown v. Jevic, 575 F.3d 322, 327 (3d

Cir. 2009). Further, because neither IndyMac nor the FDIC have

received service in this action, and because Herzog commenced

this action more than 120 days ago, the Court will terminate the

action insofar as it was brought against IndyMac. See

Fed.R.Civ.P. 4(m).

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for her RESPA and TILA claims by applying the doctrine of

equitable tolling because the “Complaint sufficiently discloses

that many facts were concealed during the course of the loan

transaction[.]” (Opp’n Br. at 6-8.)

Moving Defendants also argue that Herzog’s NJCFA claims fail

for three reasons, i.e., because: (1) such claims rest upon the

RESPA and TILA claims, are barred by the applicable statutes of

limitations; (2) the Loan was neither predatory nor a negative

amortization loan; and (3) Herzog has failed to plead facts

supporting her claim that the Loan “constituted an unconscionable

commercial practice, deception, fraud, false pretense, false

promise or misrepresentation[.]” (Defs. Br. at 9-13.) Herzog

asserts, as noted above, that the underlying RESPA and TILA

claims should survive the statutes of limitations under the

doctrine of equitable tolling. (Opp’n Br. at 6-8.) She further

argues that the Complaint facially supports her other claims

under NJCFA. (Id. at 11.) 

Herzog finally argues that the Court, if it finds that

dismissal is warranted, should permit her the opportunity to file

an amended complaint. (Id. at 12.) 

DISCUSSION

I. Standard of Review

A party may move to dismiss a claim pursuant to Rule

12(b)(6) for “failure to state a claim upon which relief can be

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granted.” Fed.R.Civ.P. 12(b)(6); see also Carmen v. Metrocities

Mortg., No. 08-2729, 2010 WL 421115, at *3-8 (D.N.J. Feb. 1,

2010) (granting defendants’ Rule 12(b)(6) challenges to

complaint). In addressing a motion to dismiss a claim under Rule

12(b)(6), the Court must accept all of the factual allegations

contained in the complaint as true, construe the claims contained

therein in the light most favorable to the plaintiff, and

determine whether, under any reasonable reading of those claims,

the plaintiff may be entitled to relief. See Ashcroft v. Iqbal,

556 U.S. 662, 129 S.Ct. 1937, 1949–50 (2009); Phillips v. Cnty.

of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008). At this stage,

the complaint “must contain sufficient factual matter, accepted

as true to ‘state a claim to relief that is plausible on its

face.’ A claim has facial plausibility when the plaintiff pleads

factual content that allows the court to draw the reasonable

inference that the defendants is liable for the misconduct

alleged.” See Iqbal, 129 S.Ct. at 1949 (citation omitted). 

The Court, when considering a motion to dismiss filed

pursuant to Rule 12(b)(6), generally may not “consider matters

extraneous to the pleadings.” In re Burlington Coat Factory Sec.

Litig., 114 F.3d 1410, 1426 (3d Cir. 1997). The Court may,

however, consider certain documents without converting such a

motion into one for summary judgment. Angstadt v. Midd-West Sch.

Dist., 377 F.3d 338, 342 (3d Cir. 2004). Such documents include

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exhibits that are attached to the pleadings, and documents

integral to or explicitly relied upon in the pleadings. Id.

II. The RESPA Claim

RESPA exists “to insure that consumers throughout the Nation

are provided with greater and more timely information on the

nature and costs of the settlement process and are protected from

unnecessarily high settlement charges caused by certain abusive

practices that have developed in some areas of the country.” 12

U.S.C. § 2601(a). 

It is the purpose of this chapter to effect

certain changes in the settlement process for

residential real estate that will result--

(1) in more effective advance disclosure to home buyers

and sellers of settlement costs; 

(2) in the elimination of kickbacks or referral fees

that tend to increase unnecessarily the costs of

certain settlement services; 

(3) in a reduction in the amounts home buyers are

required to place in escrow accounts established to

insure the payment of real estate taxes and insurance;

and 

(4) in significant reform and modernization of local

recordkeeping of land title information. 

12 U.S.C. § 2601(b).

RESPA, although requiring lenders to provide some

disclosures, such as settlement statements, does not require

disclosure of loan applications. See 12 U.S.C. §§ 2601-2617. 

Herzog thus cannot state a claim under RESPA for IndyMac’s

alleged failure to provide her a copy of the URLA. The Court

will accordingly grant the motion insofar as it seeks dismissal

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of Herzog’s RESPA claim, without consideration of the applicable

statute of limitations.

III. The TILA Claim

TILA exists “to assure a meaningful disclosure of credit

terms so that the consumer will be able to compare more readily

the various credit terms available to him and avoid the

uninformed use of credit, and to protect the consumer against

inaccurate and unfair credit billing and . . . practices.” 15

U.S.C. § 1601. TILA thus requires lenders to make specific

disclosures to borrowers and provides a civil cause of action for

violation of these disclosure requirements. See Ramadan v. Chase

Manhattan Corp., 156 F.3d 499, 500 (3d Cir. 1998). 

If a lender fails to make one or more of the required

disclosures, a plaintiff may bring an action against the lender,

seeking statutory damages. Such a claim, however, is subject to

a one-year statute of limitations, which begins to run when the

underlying contract is executed. See 15 U.S.C. § 1640(e);

Bartholomew v. Northampton Nat’l Bank of Easton, 584 F.2d 1288,

1296 (3d Cir. 1978). The statute of limitations thus began to

run here on July 21, 2006 and expired on July 23, 2007,

approximately one year before the Complaint in this action was

filed. (See Compl. at ¶ 1.)2

 July 21, 2007 fell on a Saturday. The statute of 2

limitations thus ran until July 23, 2007. See Fed.R.Civ.P. 6(c). 

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This limitations period is, however, subject to equitable

tolling. Ramadan, 156 F.3d at 504. Equitable tolling is an

extraordinary remedy that can rescue a claim otherwise barred by

a statute of limitations “when a plaintiff has been prevented

from filing in a timely manner due to sufficiently inequitable

circumstances.” Santos v. United States, 559 F.3d 189, 197 (3d

Cir. 2009) (internal quotation marks and citation omitted). 

Because equitable tolling is an extraordinary remedy, courts

grant it only sparingly. Hedges v. United States, 404 F.3d 744,

751 (3d Cir. 2005).

The doctrine applies only in very limited circumstances,

including, inter alia, where the plaintiff alleges that the

defendant actively misled the plaintiff about the plaintiff’s

cause of action. Santos, 559 F.3d at 197. When raising the

doctrine on such grounds, the complaint must contain

particularized allegations that: (1) the defendant actively

misled the plaintiff; (2) such action prevented the plaintiff

from recognizing the validity of her claim within the limitations

period; and (3) the plaintiff’s ignorance of her claims was not

attributable to her lack of reasonable due diligence in

attempting to uncover relevant facts. Cetel v. Kirwan Fin. Gp.,

Inc., 460 F.3d 494, 509 (3d Cir. 2006). 

The Complaint in this matter does not contain such

allegations. Although Herzog claims that IndyMac failed to

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disclose the full finance charge on the Loan, Herzog has not

alleged facts demonstrating either that such action prevented her

from recognizing the validity of her claim within the limitations

period imposed by 15 U.S.C. § 1640(e), or that her failure to

recognize her claim stemmed from IndyMac’s deception rather than

from her failure to uncover and investigate relevant facts. (See

Compl. at ¶ 4.) See Cetel, 460 F.3d at 509. The Court will thus

grant the motion insofar as it seeks dismissal of Herzog’s TILA

claim. The Court will dismiss the claim, however, without

prejudice to Herzog to move for leave to file an amended

complaint. See Fed.R.Civ.P. 15(a)(2).

IV. The NJCFA Claims

The Court will remand Herzog’s NJCFA claims to state court

pursuant to 28 U.S.C. § 1367(c)(3), because such claims arise

under state law. See 28 U.S.C. § 1367(c)(3); Figueroa v.

Buccaneer Hotel, 188 F.3d 172, 181 (3d Cir. 1999). In so doing,

the Court offers no opinion on the merits or the viability of

such claims. The Court will remand such claims without

prejudice, thus allowing Herzog to move for leave to file an

amended complaint before this Court that includes both the

aforementioned potential amended TILA claims and any proposed

amended NJCFA claims. 

3

 The Court, in so doing, will deny the part of the motion 3

concerning the NJCFA claims without prejudice.

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CONCLUSION

For all of the reasons stated above, the Court will grant

the motion to dismiss. In so doing, the Court will: (1) dismiss

Herzog’s claims under RESPA with prejudice; (2) dismiss Herzog’s

claim under TILA without prejudice; and (3) remand Herzog’s

claims under NJCFA without prejudice. The Court will also, as

noted in n.1, supra, order that judgment be entered in favor of

IndyMac, as neither IndyMac nor its receiver, the FDIC, were

served within 120 days of the filing of the Complaint. 

The Court will issue an appropriate Order and Judgment.

 s/ Mary L. Cooper 

MARY L. COOPER

United States District Judge

Dated: November 9, 2011

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