STATE OF MAINE BUSINESS AND CONSUMER COURT
Cumberland, ss. Dock. et No. rJ?-CV-12-09 A-M t1- CuM- ..:, "1 / 20 !1__ I i
TODD PETTERSEN
Plaintiff
v.
COUNTRYWIDE FINANCIAL CORPORATION as acquired by BANK OF AMERICA CORPORATION
Defendant
ORDER ON DEFENDANT'S MOTION TO DISMISS
The motion to dismiss filed by Defendant Countrywide Financial Corporation as
acquired by Bank Of America Corporation is before the court, together with Plaintiff Todd ·'
Petterson's opposition and Defendant's reply.
Background.
The Plaintiffs complaint asserts that Countrywide provided him with a residential
mortgage loan in 2005 at a higher interest rate than the rate quoted to him that induced him to
enter into the transaction. The complaint also asserts that Countrywide misled the Plaintiff
about the amount of his monthly payments-specifically that the payments included amounts
to fund an escrow account for taxes and insurance when in fact there was no escrow account
and the monthly payments covered only principal and interest on the loan. Plaintiff says he
was never told that the "exorbitant" fees and charges on his loan amounted to 3.5% of the
principal amount of the loan. Finally, the Plaintiff says that Countrywide represented that he
would be able to refinance and lower his monthly payment in six months, but never offered him
such an opportunity. As a result of the alleged misstatements and misrepresentations of Countrywide,
Plaintiff claims to have been unable to refinance and to be at risk of losing his home.
Plaintiffs complaint asserts that Defendant Bank of America, as successor in interest to
Countrywide, is liable on several distinct grounds:
• Count I of the complaint alleges that Countrywide's acts and omissions constitute
violations ofthe Maine Unfair Trade Practices Act (UTPA), 5 M.R.S. §§ 206-214
• Count II, III and IV allege violations of the Maine Consumer Credit Code, 9-A M.R.S .
§§ 9-401, 9-402, 10-101 et seq.
• Count V alleges intentional misrepresentation, i.e. fraud, under the common law and for
purposes of the Maine Consumer Credit Code
• Count VI alleges intentional and/ or negligent infliction of emotional distress
Defendant Bank of America, denies any liability and has moved to dismiss all of
Plaintiffs claims. 1
Standard if Review
A motion to dismiss "tests the legal sufficiency of the complaint." Livonia v. Town if
Rome, 1998 ME 39, ~ 5, 707 A.2d 83, 85. "Dismissal of a civil action is proper when the
complaint fails 'to state a claim upon which relief can be granted."' Bean v. Cummings, 2008 ME
18, ~ 7, 939 A.2d 676, 679 (citing M.R. Civ. P. 12(b)(6)). In determining whether a motion to
dismiss should be granted, the court considers "the allegations in the complaint in relation to
any cause of action that may reasonably be inferred from the complaint." Saunders v. Tisher,
2006 ME 94, ~ 8, 902 A.2d 830, 832.
1 In addition to the arguments summarized in this order, the Defendant argues that the Plaintiff is not entitled to the remedy of rescission even if he were to prevail on any of his claims, based on the passage of six years since the loan transaction. Defendant may well be correct, but rescission is a remedy and not a cause of action, and this Order does not address the nature or extent ofPlaintiffs potential recovery; it addresses only the viability ofhis claims as a matter oflaw.
2 The facts alleged are treated as admitted for purposes of the motion, and they are
viewed "in the light most favorable to the plaintiff" !d. The court should dismiss a claim only
"when it appears beyond a doubt that the plaintiff is not entitled to relief under any set of facts
that he [or she] might prove in support of his [or her] claim." !d. (quoting Johanson v.
Dunnington, 2001 ME 169, ~ 5, 785 A.2d 1244, 1246).
The Merits cifDifendant's Motion
Assessed under the very liberal standard applicable to motions to dismiss for failure to
state a claim under Rule 12(b)(6), most ofthe Plaintiffs claims are sufficient to withstand the
Defendant's motion. Many of the arguments on which the Defendant relies would be better
presented in a motion for summary judgment-some indication ofthat appears in the number
and variety of the references to outside materials-a state government website, loan
documents, the terms of a Consent Judgment--contained in the Defendant's memorandum.
Normally, when materials outside the pleadings are incorporated or referred to in a
Rule 12(b)(6) motion, the court must decide whether to consider or exclude the additional
materials, and ifthey are considered, the motion to dismiss is converted into a motion for
summary judgment. See Beaucage v. City if Rockland, 2000 ME 184, ~ 5, 760 A.2d 1054, 1056;
In re Magro, 655 A.2d 341, 342 (Me. 1995). See also M.R. Civ. P. 12(b) ("If, on a motion
asserting the defense numbered (6) to dismiss for failure of the pleading to state a claim upon
which relief can be granted, matters outside the pleading are presented to and not excluded by
the court, the motion shall be treated as one for summary judgment .... ").
However, the Law Court has recognized an exception to this general rule covering
three types ofmaterial outside the pleadings: "[O]fficial public documents, documents that are
central to the plaintiffs claim, and documents referred to in the complaint [can be considered]
without converting a motion to dismiss into a motion for a summary judgment when the
3 authenticity of such documents is not challenged." See Moody v. State Liquor and Lottery
Commission, 2004 ME 20, ~ 10, 843 A.2d 43, 48.
In the present case, the range of materials presented by Defendant is such that the court
elects to exercise its discretion not to consider them, and therefore limits its focus to the
relatively narrow question of whether, as a matter oflaw and viewed in a light most favorable
to the Plaintiff, each of the counts of the complaint states a claim upon which relief can be
granted.
Count I Maine's UTPA declares that "[u]nfair methods and unfair or deceptive acts or
practices in the conduct of any trade or commerce" are unlawful, 5 M.R.S. § 207, and provides a
cause of action for "[a]ny person who purchases or leases goods, services or property, real or
personal, primarily for personal, family or household purposes and thereby suffers any loss of
money or property, real or personal" as a result of unfair methods, acts, or practices, 5 M.R.S. §
213(1) (emphasis added).
The Maine Law Court has referred to the UTPA as a consumer protection statute. See
State v. Weinschenk, 2005 ME 28, ~ 11, 868 A.2d 200, 205 ("Maine's UTPA provides protection
for consumers against unfair and deceptive trade practices." (emphasis added) (citation omitted).
Because this was a residential loan transaction made to the homeowner, Plaintiffhas
standing under the UTPA. The court cannot say, as a matter oflaw based on the present
record, that a reasonable factfinder could not conclude that the acts and omissions alleged in
the complaint were deceptive or unfair for purposes of the UTPA. Defendant's emphasis on the
terms of the loan documents as overriding any contrary understanding on the Plaintiffs part
would be better presented in the context of a summary judgment motion. The motion to
Free access — add to your briefcase to read the full text and ask questions with AI
STATE OF MAINE BUSINESS AND CONSUMER COURT
Cumberland, ss. Dock. et No. rJ?-CV-12-09 A-M t1- CuM- ..:, "1 / 20 !1__ I i
TODD PETTERSEN
Plaintiff
v.
COUNTRYWIDE FINANCIAL CORPORATION as acquired by BANK OF AMERICA CORPORATION
Defendant
ORDER ON DEFENDANT'S MOTION TO DISMISS
The motion to dismiss filed by Defendant Countrywide Financial Corporation as
acquired by Bank Of America Corporation is before the court, together with Plaintiff Todd ·'
Petterson's opposition and Defendant's reply.
Background.
The Plaintiffs complaint asserts that Countrywide provided him with a residential
mortgage loan in 2005 at a higher interest rate than the rate quoted to him that induced him to
enter into the transaction. The complaint also asserts that Countrywide misled the Plaintiff
about the amount of his monthly payments-specifically that the payments included amounts
to fund an escrow account for taxes and insurance when in fact there was no escrow account
and the monthly payments covered only principal and interest on the loan. Plaintiff says he
was never told that the "exorbitant" fees and charges on his loan amounted to 3.5% of the
principal amount of the loan. Finally, the Plaintiff says that Countrywide represented that he
would be able to refinance and lower his monthly payment in six months, but never offered him
such an opportunity. As a result of the alleged misstatements and misrepresentations of Countrywide,
Plaintiff claims to have been unable to refinance and to be at risk of losing his home.
Plaintiffs complaint asserts that Defendant Bank of America, as successor in interest to
Countrywide, is liable on several distinct grounds:
• Count I of the complaint alleges that Countrywide's acts and omissions constitute
violations ofthe Maine Unfair Trade Practices Act (UTPA), 5 M.R.S. §§ 206-214
• Count II, III and IV allege violations of the Maine Consumer Credit Code, 9-A M.R.S .
§§ 9-401, 9-402, 10-101 et seq.
• Count V alleges intentional misrepresentation, i.e. fraud, under the common law and for
purposes of the Maine Consumer Credit Code
• Count VI alleges intentional and/ or negligent infliction of emotional distress
Defendant Bank of America, denies any liability and has moved to dismiss all of
Plaintiffs claims. 1
Standard if Review
A motion to dismiss "tests the legal sufficiency of the complaint." Livonia v. Town if
Rome, 1998 ME 39, ~ 5, 707 A.2d 83, 85. "Dismissal of a civil action is proper when the
complaint fails 'to state a claim upon which relief can be granted."' Bean v. Cummings, 2008 ME
18, ~ 7, 939 A.2d 676, 679 (citing M.R. Civ. P. 12(b)(6)). In determining whether a motion to
dismiss should be granted, the court considers "the allegations in the complaint in relation to
any cause of action that may reasonably be inferred from the complaint." Saunders v. Tisher,
2006 ME 94, ~ 8, 902 A.2d 830, 832.
1 In addition to the arguments summarized in this order, the Defendant argues that the Plaintiff is not entitled to the remedy of rescission even if he were to prevail on any of his claims, based on the passage of six years since the loan transaction. Defendant may well be correct, but rescission is a remedy and not a cause of action, and this Order does not address the nature or extent ofPlaintiffs potential recovery; it addresses only the viability ofhis claims as a matter oflaw.
2 The facts alleged are treated as admitted for purposes of the motion, and they are
viewed "in the light most favorable to the plaintiff" !d. The court should dismiss a claim only
"when it appears beyond a doubt that the plaintiff is not entitled to relief under any set of facts
that he [or she] might prove in support of his [or her] claim." !d. (quoting Johanson v.
Dunnington, 2001 ME 169, ~ 5, 785 A.2d 1244, 1246).
The Merits cifDifendant's Motion
Assessed under the very liberal standard applicable to motions to dismiss for failure to
state a claim under Rule 12(b)(6), most ofthe Plaintiffs claims are sufficient to withstand the
Defendant's motion. Many of the arguments on which the Defendant relies would be better
presented in a motion for summary judgment-some indication ofthat appears in the number
and variety of the references to outside materials-a state government website, loan
documents, the terms of a Consent Judgment--contained in the Defendant's memorandum.
Normally, when materials outside the pleadings are incorporated or referred to in a
Rule 12(b)(6) motion, the court must decide whether to consider or exclude the additional
materials, and ifthey are considered, the motion to dismiss is converted into a motion for
summary judgment. See Beaucage v. City if Rockland, 2000 ME 184, ~ 5, 760 A.2d 1054, 1056;
In re Magro, 655 A.2d 341, 342 (Me. 1995). See also M.R. Civ. P. 12(b) ("If, on a motion
asserting the defense numbered (6) to dismiss for failure of the pleading to state a claim upon
which relief can be granted, matters outside the pleading are presented to and not excluded by
the court, the motion shall be treated as one for summary judgment .... ").
However, the Law Court has recognized an exception to this general rule covering
three types ofmaterial outside the pleadings: "[O]fficial public documents, documents that are
central to the plaintiffs claim, and documents referred to in the complaint [can be considered]
without converting a motion to dismiss into a motion for a summary judgment when the
3 authenticity of such documents is not challenged." See Moody v. State Liquor and Lottery
Commission, 2004 ME 20, ~ 10, 843 A.2d 43, 48.
In the present case, the range of materials presented by Defendant is such that the court
elects to exercise its discretion not to consider them, and therefore limits its focus to the
relatively narrow question of whether, as a matter oflaw and viewed in a light most favorable
to the Plaintiff, each of the counts of the complaint states a claim upon which relief can be
granted.
Count I Maine's UTPA declares that "[u]nfair methods and unfair or deceptive acts or
practices in the conduct of any trade or commerce" are unlawful, 5 M.R.S. § 207, and provides a
cause of action for "[a]ny person who purchases or leases goods, services or property, real or
personal, primarily for personal, family or household purposes and thereby suffers any loss of
money or property, real or personal" as a result of unfair methods, acts, or practices, 5 M.R.S. §
213(1) (emphasis added).
The Maine Law Court has referred to the UTPA as a consumer protection statute. See
State v. Weinschenk, 2005 ME 28, ~ 11, 868 A.2d 200, 205 ("Maine's UTPA provides protection
for consumers against unfair and deceptive trade practices." (emphasis added) (citation omitted).
Because this was a residential loan transaction made to the homeowner, Plaintiffhas
standing under the UTPA. The court cannot say, as a matter oflaw based on the present
record, that a reasonable factfinder could not conclude that the acts and omissions alleged in
the complaint were deceptive or unfair for purposes of the UTPA. Defendant's emphasis on the
terms of the loan documents as overriding any contrary understanding on the Plaintiffs part
would be better presented in the context of a summary judgment motion. The motion to
dismiss is denied as to Count I.
4 Counts II, III and IV: Defendant makes much the same arguments in response to the
Maine Consumer Credit Code counts of the complaint: the loan documents control; there were
no misrepresentations, with the added point that article 10 of the Code does not apply, pointing
to a website as authority. The conclusion must be the same: the four corners of the complaint
allege viable claims in Counts II, III and IV. It may be that material outside the pleadings will
conclusively resolve factual questions in the summary judgment context, but the court has
elected not to consider materials outside the pleadings. Defendant's motion is denied as to
Counts II, III and IV.
Count V: Defendant responds to Plaintiffs fraud claim in much the same terms as to
previous counts, with the added argument that the claim is not pleaded with particularity as
required by M.R. Civ. P. 9(b). The court agrees that the complaint is somewhat vague in
several respects. For example, paragraph 17 of the complaint is unclear about whether the
alleged statement of"Countrywide" about Plaintiffs ability to refinance in six months was
made by the broker at closing or by someone else. A second area of uncertainty is which ofthe
various statements of Countrywide Plaintiffis claiming are fraudulent. As pleaded, Count V
incorporates prior allegations by reference, making it less than clear what exactly Countrywide
is supposed to have said or done that is alleged to constitute fraud.
The court accordingly will grant the motion to dismiss as to Count V, but will allow
Plaintiffleave to file an amended complaint in which Count V specifies, with as much detail as
Plaintiff can bring to bear, all of the representations that Plaintiffs claims were fraudulent
(rather than simply incorporating prior paragraphs as the current version of Count V does).
Count VI: Maine cases make it clear that recovery for misrepresentation is limited to
pecuniary loss and that damages for "emotional or mental pain and suffering are not
recoverable." Jourdain v. Dineen, 527 A.2d 1304, 1307 (Me. 1987; accord, Chapman v. Rideout,
5 568 A.2d 829, 830 (Me. 1990). See Veilleux v. National Broadcasting Co., 206 F.sd 92, ISO (1st
Cir. 2000) (applying Maine law). Plaintiffs claims all are founded on alleged misstatements or
misrepresentations, so as a matter oflaw he cannot recover for emotional distress, whether
intentionally or negligently inflicted. Defendant's motion is therefore granted as to Count VI.
Conclusion
For the reasons stated, the Defendant's Motion to Dismiss is hereby granted with
respect to Counts V and VI. Plaintiffmay within 20 days of this order file an amended
complaint, limited to an amendment of Count V consistent with this Order. 2
Pursuant to M.R. Civ. P. 79, the clerk is hereby directed to incorporate this order by
reference in the docket.
Dated March 7, 2012 A.M. Horton Justice, Business and Consumer Court
Entered on the Docket: 3• "J • I~ Copies sent via Mail_ Electronically .V
2 Any further amendment of the complaint must be on motion.
6 STATE OF MAINE BUSINESS AND CONSUMER DOCKET CUMBERLAND, ss. Location: Portland
TODD PETTERSEN Plaintiff
v. DOCKET NO. BCD-CV-2012-09
COUNTRYWIDE FINANCIAL CORPORATION as acquired by BANK OF AMERICA CORPORATION Defendant
COUNSEL OF RECORD
Party Name: Attorney Name: Todd Pettersen Andre Bopp Stark, Esq.
Countrywide Financial Corp Corin Swift, Esq. Jeff Goldman, Esq.