United States District Court, S.D. Indiana, Indianapolis Division
ORDER ADOPTING REPORT AND RECOMMENDATION
WALTON PRATT, JUDGE
matter is before the Court on Plaintiff, Kimball Rustin Roy
Scarr's (“Scarr”), Objections to the
Magistrate Judge's Report and Recommendation (Filing
No. 147, Filing No. 152). Scarr filed this
action against multiple defendants alleging each fraud and
violation of numerous statutes. The Defendants each filed
Motions to Dismiss the Amended Complaint. Defendant Feiwell
and Hannoy PC filed a Motion to Dismiss (Filing No.
77) pursuant to Federal Rules of Civil Procedure 8(a),
12(b)(1), and 12(b)(6); Defendants Secretary of Housing and
Urban Development filed a Motion to Dismiss (Filing No.
79); Defendants Mortgage Electronic Registration
Systems, Inc. and JP Morgan Chase Bank, N.A. filed a Motion
to Dismiss Pursuant to Federal Rules of Civil Procedure 8(a),
12(b)(1), and 12(b)(6) (Filing No. 89), and
Defendants Caliber Home Loans, Inc., LSF9 Mortgage Holdings
LLC, LSF9 Master Participation Trust filed a Motion to
Dismiss Plaintiff's New Amended Complaint (Filing No.
91). The Motions were referred to the Magistrate Judge
for a Report and Recommendation (Filing No. 136). On
January 25, 2018, the Magistrate Judge submitted her Report
and Recommendation that each of the Motions to Dismiss be
granted. In addition, the Magistrate Judge denied all pending
non-dispositive motions (Filing No. 109, Filing
No. 127, Filing No. 132, Filing No.
137 and Filing No. 138). Scarr filed a timely
objection. For the reasons stated below, the Court
overrules Scarr's Objections and
adopts the Magistrate Judge's Report and
following facts are accepted as true for purposes of the
Motions to Dismiss and all reasonable inferences are drawn in
a light most favorable to Scarr as the non-moving party.
See Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th
Cir. 2008). Scarr raised no objections to the Magistrate
Judge's detailed and thorough recitation of the facts,
(Filing No. 137 at 1-6), therefore the facts will
only be summarized in this Entry.
executed a mortgage on his home in Connersville, Fayette
County, Indiana, with SurePoint Lending
(“SurePoint”) in 2008. The mortgage was later
assigned to JPMorgan Chase Bank, N.A. (“Chase”).
In June 2013, after making mortgage payments for almost five
years, Scarr stopped making mortgage payments and Chase
commenced a mortgage foreclosure action in Fayette County
Superior Court against Scarr, which was assigned Cause No.
21D01-1312-MF-00873. Scarr challenged the validity of the
promissory note and mortgage and the state trial court
granted Chase a summary judgment award in the amount of $200,
649.11 and ordered foreclosure of the mortgage. Scarr
challenged the grant of summary judgment and asserted Chase
lacked standing to foreclose on the mortgage. The Indiana
Court of Appeals affirmed the grant of summary judgment and
denial of the motion to correct error. See Scarr v.
JPMorgan Chase Bank Nat. Ass'n., 40 N.E.3d 531
(Ind.Ct.App. 2015) (unpublished), trans. denied, 49
N.E.3d 107 (Ind. 2016).
March 9, 2017, Scarr filed the operative Amended Complaint in
this case alleging in Count 1 that Defendants SurePoint and
Chase engaged in fraud in originating a mortgage loan without
a note and making inaccurate and incomplete disclosures, and
engaged in a conspiracy to prevent Scarr's rescission of
that loan. Count 2 alleges that in connection with the
mortgage loan, Chase and LSF9 Mortgage Holdings, LLC violated
the Truth in Lending Act, 15 U.S.C. §§ 1631- 1651;
Regulation X, 12 C.F.R. § 1024; and the Real Estate
Settlement Procedures Act (“RESPA”), 12 U.S.C.
§§ 2601-2617, by withholding information about the
assignment of the mortgage loan and withholding RESPA
notifications. Count 3 alleges that SurePoint, Chase, LSF9
Mortgage Holdings and LSF9 Master Participation Trust, 2 and
Caliber Home Loans, Inc. engaged in fraud and conspiracy to
commit fraud to prevent rescission and obtain a judgment of
foreclosure, obstruction of justice, and money laundering.
Count 4 claims inadequate management and oversight by the
United States Department of Housing and Urban Development
(“HUD”) of its Federal Housing Administration
(“FHA”) insurance programs. The complaint
contains a fifth count alleging injuries to Scarr and his
family, namely, the mortgage loan, the state court
foreclosure action, the loss of FHA insurance protections,
the personal judgment against Scarr in the foreclosure
action, the order of a sheriff's sale of his home, and
thoughtful and detailed Order, the Magistrate Judge
recommended that the Court grant each Defendant's motion
to dismiss. To the extent the Amended Complaint challenged
the state court foreclosure judgment or sought rescission of
Scarr's mortgage loan, the Magistrate Judge recommended
dismissal of those claims without prejudice for lack of
subject matter jurisdiction. To the extent that any of
Scarr's claims are not barred by the Rooker-Feldman
doctrine, the Magistrate Judge recommended
dismissal with prejudice for failure to state a claim based
on claim preclusion or issue preclusion.
Objection to Dispositive Matters
district court may assign dispositive matters to a magistrate
judge, in which case the magistrate judge may submit to the
district judge only a report and recommended disposition,
including any findings of fact. 28 U.S.C. § 636(b)(1)(B)
(2012); Fed.R.Civ.P. 72(b)(1). See also Schur v. L.A.
Weight Loss Ctrs., Inc., 577 F.3d 752, 760 (7th Cir.
2009). The magistrate judge's recommendation on a
dispositive matter is not a final order, and the district
judge makes the ultimate decision to “accept, reject,
or modify” the findings and recommendations, and the
district court need not accept any portion as binding. 28
U.S.C. § 636(b)(1) (2012); Fed.R.Civ.P. 72(b)(3).
See also Schur, 577 F.3d at 760-61.
magistrate judge makes a report and recommendation, either
party may object within fourteen days of being served with a
copy of the same. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P.
72(b)(2). When a party raises specific objections to findings
and recommendations made within the magistrate judge's
report, the district court is required to review those
objections de novo, determining for itself whether
the magistrate judge's decisions as to those issues are
supported by substantial evidence or were the result of an
error of law. 28 U.S.C. § 636(b)(1) (2012); Fed.R.Civ.P.
72(b)(3). See also Johnson v. Zema Sys. Corp., 170
F.3d 734, 739 (7th Cir. 1999). The court may, however, defer
to those conclusions to which timely objections have not been
raised by a party. Schur, 577 F.3d at 760-61.
Further, if a party fails to object to a magistrate
judge's report and recommendation, or objects on some
issues and not others, the party waives appellate review of
the issues to which the party has not objected.
Johnson, 170 F.3d at 739.
Objection to Non-Dispositive Matters
district court may refer a non-dispositive pretrial motion to
a magistrate judge under Federal Rule of Civil Procedure
72(a). Rule 72(a) provides:
When a pretrial matter not dispositive of a party's claim
or defense is referred to a magistrate judge to hear and
decide, the magistrate judge must promptly conduct the
required proceedings and, when appropriate, issue a written
order stating the decision. A party may serve and file
objections to the order within 14 days after being served