Remus v. Wcp Fund I LLC.

District Court, District of Columbia·Decided August 25, 2025·No. Civil Action No. 2024-3366·Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

SOLON PHILLIPS, as member-trustee of REMUS ENTERPRISES, 1 LLC,

Plaintiff,

Case No. 1:24-cv-03366 (TNM)

v.

WCP FUND I LLC, Defendant.

MEMORANDUM OPINION

If you take out a loan, payback is all but inevitable. When Plaintiff Remus Enterprises did not repay two commercial loans from Defendant WCP Fund to buy and flip a house, Remus had to pay loan extension fees for several months until it eventually lost the property to foreclosure.

Remus already unsuccessfully sued WCP in the Superior Court of the District of Columbia last year. Now, trying again here, the company alleges violations of the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA), breach of contract, promissory estoppel, duress and unconscionability, and unjust enrichment. WCP moves to dismiss. The Court will grant the motion because most of Remus’s claims are precluded by its first suit and the rest fail to state a claim.

I.

Remus buys, renovates, and re-sells residential homes in Washington, D.C. Am. Compl.

¶ 7, ECF No. 14. WCP is a lender for real estate investors. Am. Compl. ¶ 2. Remus obtained two loans from WCP to buy a property on Tennessee Avenue in Washington, D.C., one for $820,250 and one for $48,250. Am. Compl. ¶ 18. After unexpected permitting delays and a

spike in interest rates, Remus failed to make payments on either loan. Am. Compl. ¶ 44. Remus alleges that WCP agreed to accept all outstanding payments on the loans after the property sold. Am. Compl. ¶ 47. The parties had made a similar agreement for a loan on a separate property on 8th Street, which WCP honored. Am. Compl. ¶¶ 48–49.

But WCP’s patience wore thin for the Tennessee Avenue property. While waiting for the home to sell, WCP demanded that Remus sign four loan-extension agreements that delayed the maturity dates to March 2024, then to June. Am. Compl. ¶¶ 50–51, 64–66; Loan Modifications, ECF Nos. 15-6, 15-7, 15-8, 15-9. Each time Remus absorbed modification fees that ranged from around $500 to nearly $16,500. E.g., Loan Modification, ECF No. 15-6, at 2; Loan Modification, ECF No. 15-9, at 2. In March 2024, Remus sued WCP in Superior Court for violating the Mortgage Lender and Broker Act and the Interest and Usury Statute. Phillips et al. v. DP Cap., LLC, No. 2024-CAB-001373, (D.C. Super. Ct. June 17, 2024). That court granted WCP’s motion to dismiss the case for failing to state a claim. Id. The dismissal was affirmed on appeal. Phillips et al. v. DP Cap., LLC, et al., No. 24-cv-0635 (D.C. Aug. 4, 2025).

Eventually, Remus reduced the price and ratified a contract for sale of the Tennessee Avenue property. Am. Compl. ¶ 65. But the sale did not go through before the loans came due in June 2024. Loan Modification, ECF No. 15-8 at 2; Loan Modification, ECF No. 15-9, at 2. WCP demanded another loan extension and modification fee. Am. Compl. ¶ 66. Remus had “numerous heated conversations” with WCP in which Remus objected to paying yet another extension fee for a third loan modification. Am. Compl. ¶ 66. Remus requested a payoff statement to complete the home sale, but it says that WCP provided a statement reflecting “close to $300,000 in additional fees.” Am. Compl. ¶¶ 68–69. Remus “questioned” “these unjustified junk fees” in “another heated conversation” with WCP. Am. Compl. ¶¶ 70–72. “Upon the last

heated conversation,” WCP “hinted” that it “would be foreclosing on the Property.” Am. Compl. ¶ 73. WCP then refused to provide a payoff statement to Remus’s title company, so it could not sell the property or refinance. Am. Compl. ¶¶ 73–77.

In August 2024, WCP foreclosed on the Tennessee Avenue home. Am. Compl. ¶ 78. It bought the property for $1,000, re-listed it, and asked the same real estate agent Remus had used to sell the property. Am. Compl. ¶¶ 78–79.

Remus then filed in this Court seeking relief for various alleged violations of federal and D.C. law, beginning when it signed the original loans with WCP and extending through the foreclosure. Compl., ECF No. 1. After Remus amended its Complaint as of right, WCP responded with a motion to dismiss. Mot. Dismiss, ECF No. 15. The briefing is ripe for consideration.

II.

The Court has subject-matter jurisdiction over the federal claims under 28 U.S.C. § 1331 and over the D.C. law claims under 28 U.S.C. § 1332. The Court will dismiss Remus’s federal claims due to res judicata. See infra Part IV. Though neither party raised the issue, the Court may properly exercise jurisdiction over Remus’s remaining D.C. law claims under the diversity statute. Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006) (“[C]ourts . . . have an independent obligation to determine whether subject matter jurisdiction exists, even in the absence of a challenge from any party.”).

Remus only alleged subject-matter jurisdiction under 28 U.S.C. § 1331 because he raised a federal question under RESPA and TILA. Am. Compl. ¶ 3. Ordinarily, once the basis for federal-question jurisdiction goes away—here, once RESPA and TILA are declared res judicata—a district court should dismiss pendent state-law claims. Araya v. JPMorgan Chase

Bank, N.A., 775 F.3d 409, 418–19 (D.C. Cir. 2014) (stating that district courts “ha[ve] an obligation to exercise [their] discretion to remand the case to the District of Columbia courts once the federal question, like Elvis, ha[s] left the building.”). But when an alternative basis for jurisdiction is apparent from the face of the complaint, the court should retain jurisdiction. Nat’l Air Traffic Controllers Ass’n v. Fed. Serv. Impasse Panel, 606 F.3d 780, 788 (D.C. Cir. 2010).

Here, diversity jurisdiction is obvious from the face of the complaint. Remus was formed in Washington, D.C., and WCP was formed in Delaware. Am. Compl ¶¶ 1–2. Remus’s primary place of business is in Maryland, and WCP’s is in Virginia. Am. Compl., case caption. While Remus does not allege a specific amount in controversy, his demands total well over $75,000, because he wants at least $400,000 for construction costs and $300,000 for loan fees. Am. Compl. ¶¶ 63, 69. So the Court must exercise diversity jurisdiction under 28 U.S.C. § 1332 over the remaining state-law claims.

III.

To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), “a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (cleaned up). A court must “draw all reasonable inferences from those allegations in the plaintiff’s favor.” Hurd v. District of Columbia, 864 F.3d 671, 678 (D.C. Cir. 2017). While the Court must accept the facts in the complaint as true, it need not accept conclusory allegations that simply re-state the legal standard. Ashcroft, 556 U.S. at 678.

The Court applies the motion-to-dismiss standard even though Remus would rather convert the proceeding to summary judgment. Remus alleges that WCP has converted its motion to dismiss into a motion for summary judgment by attaching copies of the loan documents and

modification agreements between the parties. Opp’n Mot. Dismiss, ECF No. 17, at 3. But “[d]ocuments that a defendant attached to a motion to dismiss are considered part of the pleadings if they are referred to in plaintiff’s complaint and are central to her claim.” Chamberlain v. Am. Honda Fin. Corp., 931 A.2d 1018, 1025 (D.C. 2007); accord Banneker Ventures, LLC v. Graham, 798 F.3d 1119, 1133 (D.C. Cir. 2015). “The prototypical incorporation by reference occurs where a complaint claims breach of contract, and either party attaches to its pleading an authentic copy of the contract itself. Because the contract is a legally operative document that is a necessary element of the claim, the contract is integral to the plaintiff’s claim—it forms the basis for a claim or part of a claim.” Banneker Ventures, LLC, 798 F.3d at 1133. So the loan documents attached to the motion to dismiss are incorporated by reference into the pleadings.

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