Reported / Citable
Background
Pro se plaintiff Bert D. Cross, Jr. sued MortgageIT, Inc. and Wilmington Trust Co. over a 2005 mortgage loan secured by his Humble, Texas property. Cross alleges that MortgageIT failed properly to transfer the note and deed of trust, did not properly notify him of a servicing-rights transfer, and continued collecting payments and pursuing foreclosure despite a broken chain of title.
Cross asserted numerous federal and state claims and sought to quiet title, invalidate the foreclosure, and recover damages. After MortgageIT moved to dismiss, PHH Mortgage Corp. and The Bank of New York Mellon Trust Co., N.A. intervened, alleging they are the loan’s current servicer and owner. Cross then moved under Rule 12(f) to strike their complaint in intervention.
The Court’s Holding
Magistrate Judge Peter Bray recommended denying Cross’s motion to strike without prejudice. The intervenors’ allegations that they own and service the loan were relevant to the dispute, and Cross did not meet Rule 12(f)’s high standard for striking material from a pleading. His challenges to the intervenors’ ownership, standing, timing, and the merits could instead be raised later on summary judgment.
The magistrate judge also recommended denying MortgageIT’s Rule 12(b)(6) motion without prejudice. MortgageIT’s arguments—including that it had not owned or been involved with the loan for nearly two decades, was not foreclosing, and could invoke limitations and a prior bankruptcy proceeding—depended on matters outside the pleadings. Rather than convert the dismissal motion into a summary-judgment motion, the court recommended allowing MortgageIT to renew those arguments at summary judgment after appropriate discovery. The recommendation was subject to objections.
Key Takeaways
- A Rule 12(f) motion cannot be used to litigate substantive challenges to an intervenor’s claims when those allegations relate to the live dispute.
- A defendant cannot obtain Rule 12(b)(6) dismissal based on disputed material outside the complaint unless the court properly converts the motion under Rule 12(d).
- The recommendation leaves all claims and defenses unresolved and permits the parties to renew the relevant arguments at summary judgment.
Why It Matters
The recommendation illustrates the procedural limit on mortgage defendants’ efforts to resolve ownership, foreclosure, limitations, and prior-litigation issues at the pleading stage when those issues require evidence beyond the complaint. It also preserves the intervenors’ participation while directing the case toward a Rule 16 conference and limited discovery.