Court Opinion

ID: 3182649
Source: CourtListenerOpinion
Date Created: 2016-03-04 01:04:40.852094+00
Date Added: 2024-06-11T14:35:43.036457
License: Public Domain

Case: 12-20524       Document: 00513405851         Page: 1     Date Filed: 03/03/2016

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT

                                       No. 12-20524
                                                                          United States Court of Appeals
                                                                                   Fifth Circuit

                                                                                 FILED
RICHARD H. ALSENZ,                                                           March 3, 2016
                                                                            Lyle W. Cayce
               Plaintiff - Appellant                                             Clerk

v.

AURORA BANK, FSB; AURORA LOAN SERVICES, L.L.C.; CAL-WESTERN
RECONVEYANCE CORPORATION,

               Defendants - Appellees

                   Appeal from the United States District Court
                        for the Southern District of Texas
                              USDC No. 4:12-CV-186

Before BARKSDALE, CLEMENT, and HAYNES, Circuit Judges.
PER CURIAM:*
       At issue for Richard H. Alsenz’ diversity action to prevent an anticipated
foreclosure is whether the district court erred in dismissing it with prejudice
for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6).
AFFIRMED.

       * Pursuant to 5th Cir. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5th Cir.
R. 47.5.4.
    Case: 12-20524     Document: 00513405851     Page: 2   Date Filed: 03/03/2016

                                  No. 12-20524

                                        I.
      In 2004, to finance purchasing a residential property in Texas, Alsenz
executed two promissory notes, payable to Lehman Brothers Bank, and
secured payment of those notes by executing a deed of trust. On Lehman’s
behalf, another entity assigned the notes and deed of trust to Aurora Loan
Services, L.L.C. On 2 December 2011, Cal-Western Reconveyance Corp. (Cal-
Western), as trustee for Aurora Bank, FSB, initiated foreclosure proceedings;
notified Alsenz that, due to defaults, the primary Lehman loan was being
accelerated; and set a foreclosure sale for 3 January 2012.
      On 29 December, Alsenz filed this action in Texas state court against
Aurora Loan, Aurora Bank, and Cal-Western, seeking a temporary restraining
order (TRO) to prevent the foreclosure sale; asserting claims for (1) accounting,
(2) fraud and alter ego, (3) wrongful acceleration and institution of foreclosure,
(4) slander of title, (5) unreasonable collection; and requesting, inter alia,
injunctive relief. The TRO was granted that day.
      After Aurora Bank and Aurora Loan removed this action to federal court
on the basis of diversity jurisdiction, they, along with Cal-Western, moved
under Rule 12(b)(6) to dismiss Alsenz’ complaint. He did not respond to the
motion, which the district court construed as representing no opposition, based
on local rules. See S.D. Tex. Local R. 7.4.
      In May 2012, the court granted the motion to dismiss, with prejudice,
after determining Alsenz failed to plead the basic elements of any of his claims
and, therefore, did not state any claim for relief. On 26 June, Alsenz moved
for a new trial and to alter or amend the judgment; the court summarily denied
the motions the following day. Alsenz timely appealed.
      In June 2013, Cal-Western filed a suggestion of bankruptcy and notice
of automatic stay. Our court stayed this appeal, pending disposition of the
bankruptcy proceedings.     Although the bankruptcy is still pending, on 24

                                        2
    Case: 12-20524        Document: 00513405851   Page: 3   Date Filed: 03/03/2016

                                   No. 12-20524

November 2015, Aurora Bank and Aurora Loan (collectively, Aurora) moved to
lift the stay as to all parties but Cal-Western. Our court granted the motion
on 22 December.
                                        II.
      In claiming the district court erred in granting the 12(b)(6) motion,
Alsenz asserts: (1) his complaint contained sufficient particularity to state a
claim for relief; (2) the court improperly construed his claim for unreasonable
collection; (3) before dismissal, it should have given him opportunity to replead
his complaint or, in the alternative, should have dismissed without prejudice;
and (4) Rule 12(b)(6) is not applicable because it leads to a different result than
would application of Texas’ procedural rules.
      Additionally, in the statement-of-jurisdiction portion of his brief, Alsenz
states he is, inter alia, appealing from the denial of his “request for
reconsideration and/or a new trial”. Nevertheless, he does not: raise or discuss
the issue in the body of his brief; refer to the record; or cite legal authority in
support. Accordingly, we do not consider the denial of post-dismissal relief.
E.g., United States v. Maldonado, 42 F.3d 906, 910 n.7 (5th Cir. 1995);
Cavallini v. State Farm Mut. Auto Ins. Co., 44 F.3d 256, 260 n.9 (5th Cir. 1995)
(“[T]he failure to provide any legal or factual analysis of an issue results in
waiver of that issue”).
                                         A.
      This action involving property in Texas was removed to federal court on
diversity grounds. Therefore, Texas substantive law applies. See Erie R.R. Co.
v. Tompkins, 304 U.S. 64, 78–80 (1938).
      A dismissal under Rule 12(b)(6) is reviewed de novo, “accepting all well-
pleaded facts as true and viewing those facts in the light most favorable to the
plaintiff”. Harris Cty. Tex. v. MERSCORP Inc., 791 F.3d 545, 551 (5th Cir.
2015). To avoid dismissal, “a complaint must contain sufficient factual matter

                                         3
    Case: 12-20524      Document: 00513405851       Page: 4    Date Filed: 03/03/2016

                                    No. 12-20524
. . . to state a claim to relief that is plausible on its face”. Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)) (internal quotation marks omitted). “While a complaint attacked by a
Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a
plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’
requires more than labels and conclusions”.            Twombly, 550 U.S. at 555
(alteration in original) (citations omitted).
      Alsenz first contends his complaint satisfied the pleading requirements
under the Federal Rules of Civil Procedure, stating: “It is hard to imagine how
[he] could have made a more detailed pleading showing a harm caused by
[Aurora] and a need for a remedy”. Nevertheless, despite maintaining his
complaint satisfied the standard for each of his claims, Alsenz’ brief, at best,
discusses only his unreasonable-collection claim, which stated: “[Aurora’s]
conduct as cited above, including the wrongful foreclosure initiated of its
alleged interest in [Alsenz’] home, constitutes an unreasonable collection
effort”. The court construed the claim as one for unreasonable collection under
Texas common law (as did Aurora in its motion to dismiss, to which Alsenz did
not respond).
      To recover for that claim, Alsenz must show a debt collector engaged in
“efforts that amount to a course of harassment that was willful, wanton,
malicious, and intended to inflict mental anguish and bodily harm”. EMC
Mortg. Corp. v. Jones, 252 S.W.3d 857, 868 (Tex. App.—Dallas 2008, no pet.).
The court concluded that Alsenz’ “conclusory allegation of wrongful
foreclosure” was insufficient to state an unreasonable-collection claim and
dismissed it. Alsenz v. Aurora Bank, FSB, No. 4:12-CV-186, at 13 (S.D. Tex.
29 May 2012).
      At most, Alsenz asserts the court erred in construing his claim as
referring only to the Texas common-law tort, and maintains “the allegations in
                                          4
    Case: 12-20524    Document: 00513405851     Page: 5   Date Filed: 03/03/2016

                                 No. 12-20524
[the complaint] could just as easily cover violations of [unfair debt collection
practices statutes] . . . 15 U.S.C.A. § 1692(e) or . . . [§] 392.304 of the Texas
Finance Code”. He does not cite legal authority or provide factual analysis in
support of his assertion, other than stating: “it is hard to imagine that a
plaintiff who [pleads the facts alleged in the complaint] has not plead a viable
cause of action under any of those theories”.       Arguably, this assertion is
abandoned.
      Aurora responds that the court correctly determined Alsenz did not state
a claim for a common-law, unreasonable collection, because he did not allege
any facts suggesting, inter alia, malicious conduct, as required by Texas law.
Moreover, Aurora maintains Alsenz’ claims for statutory violations are raised
for the first time on appeal, which would result in waiver of those issues.
      Alsenz’ contention regarding § 1692(e) was not raised in district court;
therefore, it “cannot be asserted for the first time on appeal”. E.g., NCDR,
L.L.C. v. Mauze & Bagby, P.L.L.C., 745 F.3d 742, 752 (5th Cir. 2014). In the
same vein, the assertion that his claim could have been construed as referring
to § 392.304 of the Texas Finance Code (Texas Debt Collection Act) also fails.
In his motions for new trial and to alter or amend the judgment (the denials of
which, again, are not considered on appeal), Alsenz contended his complaint
could have stated a claim under the “Texas Debt Collections Act”.
Nevertheless, it would have been improper to raise the issue for the first time
in a post-judgment motion; accordingly, we do not consider it here: “[A] motion
to alter or amend the judgment . . . cannot be used to raise arguments which
could, and should, have been made before the judgment issued”. Rosenblatt v.
United Way of Greater Houston, 607 F.3d 413, 419 (5th Cir. 2010) (internal
quotation marks and citation omitted).
      Additionally, as specified above, an unreasonable-collection claim under
Texas common law generally requires a debt-collection effort that “amount[s]
                                       5
    Case: 12-20524    Document: 00513405851        Page: 6   Date Filed: 03/03/2016

                                   No. 12-20524
to a course of harassment that was willful, wanton, malicious, and intended to
inflict mental anguish and bodily harm”. EMC Mortg., 252 S.W.3d at 868. In
his complaint, Alsenz claimed: “[Aurora’s] conduct as cited above, including
the wrongful foreclosure initiated . . . constitutes an unreasonable collection
effort”. And, paragraph 21 of the complaint alleges that he suffered “mental
anguish and stress connected with the potential loss of his home”. But, as the
district court noted, a common-law, unreasonable-collection claim generally
requires more than “mental anguish”. McDonald v. Bennett, 674 F.2d 1080,
1088 (5th Cir. 1982). Alsenz does not allege a willful course of harassment by
Aurora, and he is required to present “more than labels and conclusions” when
stating a claim for relief. Twombly, 550 U.S. at 555. Therefore, the court did
not err in dismissing his claim.
                                        B.
      Alsenz next contends, without citation to authority or analysis, that the
court should have given him an opportunity to replead before dismissing the
action, or should have dismissed it without prejudice.            (Again, he has
abandoned any challenge to the denial of his post-judgment motions for new
trial and to alter or amend the judgment.) Arguably, because Alsenz fails to
adequately brief these alternative positions, he has abandoned them. In any
event, for the following reasons, each is without merit.
                                        1.
      A party may amend a pleading once as a matter of course within 21 days
of its service. Fed. R. Civ. P. 15(a). Otherwise, he may amend only by leave of
court or by written consent of the adverse party; and leave should be freely
given when justice so requires.      Id.       Alsenz never moved to amend his
complaint at any time before dismissal, and has urged its sufficiency
throughout the pendency of this matter. He “failed to amend [his] complaint
as a matter of right, failed to furnish the district court with a proposed
                                           6
    Case: 12-20524     Document: 00513405851       Page: 7   Date Filed: 03/03/2016

                                   No. 12-20524
amended complaint, and failed to alert both the court and [Aurora] to the
substance of [his] proposed amendment”. McKinney v. Irving Indep. Sch. Dist.,
309 F.3d 308, 315 (5th Cir. 2002); see Cinel v. Connick, 15 F.3d 1338, 1346 (5th
Cir. 1994).
                                         2.
      Concerning the challenge to the dismissal’s being with prejudice,
“[b]ecause the district court is best situated to determine when plaintiffs have
had sufficient opportunity to state their best case, we review [its] decision to
grant a motion to dismiss with or without prejudice only for abuse of
discretion”. Club Retro, L.L.C. v. Hilton, 568 F.3d 181, 215 n.34 (5th Cir. 2009).
      Along that line, Alsenz’ assertions “give[ ] no indication that he did not
plead his best case in his complaint”. Brewster v. Dretke, 587 F.3d 764, 768
(5th Cir. 2009). Indeed, he has consistently “declare[d] the adequacy of his
complaint . . . , [even after he] was on notice [it] might not be sufficient to state
a cause of action”. Jacquez v. Procunier, 801 F.2d 789, 793 (5th Cir. 1986).
Moreover, he has “failed to explain what facts he would have added or how he
could have overcome the deficiencies found by the district court if he had been
granted an opportunity to amend”. Brewster, 587 F.3d at 768 (internal
quotation marks and citation omitted).
                                         C.
      Finally, Alsenz asserts, based on Erie, 304 U.S. 64: Rule 12(b)(6) cannot
be applied in this matter because “Texas in its statutes and procedural rules
has no 12(b)(6) motion which strikes pleadings automatically”; therefore, its
application leads to a different outcome than would result from application of
Texas state rules. He notes that, prior to removal, a Texas state-court judge
determined his complaint was sufficient to justify a TRO, and maintains his
action would not have been dismissed had it remained in state court.

                                         7
    Case: 12-20524    Document: 00513405851     Page: 8   Date Filed: 03/03/2016

                                 No. 12-20524
      This reasoning was rejected by the Supreme Court in Hanna v. Plumer,
380 U.S. 460, 465–66 (1965). If a Federal Rule of Civil Procedure conflicts with
a state law, the federal rule controls as long as it “represents a valid exercise
of Congress’ rulemaking authority”. Burlington N. R.R. Co. v. Woods, 480 U.S.
1, 4–5 (1987). Alsenz does not suggest Rule 12(b)(6) is an invalid exercise of
such authority.
                                      III.
      For the foregoing reasons, the judgment is AFFIRMED.

                                       8