Yanahan v. Wells Fargo Bank, N.A.

CourtDistrict Court, N.D. Illinois
DecidedFebruary 25, 2025
Docket1:24-cv-01042
StatusUnknown

This text of Yanahan v. Wells Fargo Bank, N.A. (Yanahan v. Wells Fargo Bank, N.A.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Yanahan v. Wells Fargo Bank, N.A., (N.D. Ill. 2025).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

TIMOTHY YANAHAN,

Plaintiff, Case No. 24-cv-01042 v. Judge Mary M. Rowland WELLS FARGO BANK, N.A.,

Defendant.

MEMORANDUM OPINION AND ORDER Plaintiff Timothy Yanahan (“Yanahan” or “Plaintiff”) has sued Defendants Wells Fargo Bank, N.A. (“Defendant” or “Wells Fargo”), bringing claims under the Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”) and for breach of contract, promissory estoppel, fraudulent misrepresentation. Before the Court now is Defendant’s motion to dismiss [27]. For the reasons stated herein, Defendant’s motion is granted in part and denied in part. I. Background Unless otherwise noted, the following factual allegations taken from the operative complaint [23] are accepted as true for the purposes of the motion to dismiss. See Lax v. Mayorkas, 20 F.4th 1178, 1181 (7th Cir. 2021). Plaintiff took out a mortgage from Wells Fargo for a residential property and subsequently defaulted on that mortgage. [23] ¶¶ 7-8. Wells Fargo attempted to assist Plaintiff by having him participate in the “Home Affordable Mortgage Program (“HAMP”). [23] ¶ 10. HAMP was a program created by the federal government in response to 2008 recession which required the Secretary of the Treasury to “implement a plan that n that seeks to maximize assistance for homeowners and . . . encourage the servicers of

the underlying mortgages . . . to take advantage of . . . available programs to minimize foreclosures." 12 U.S.C. § 5219(a). As a part of the program, the Treasury Secretary set aside up to $50 billion to induce lenders to refinance mortgages with more favorable interest rates to prevent additional foreclosures. [23] ¶ 14. One of those lenders was Wells Fargo, who agreed to identify homeowners who either were in or were likely to soon be in default, and to modify their loans pursuant to the program. [23] ¶ 16. Participating lenders like Wells Fargo were to evaluate loans for

modification using a formula that assessed whether the financial return for investors would be better than allowing the borrower to default. [23] ¶ 22. Wells Fargo offered Plaintiff certain loan modifications pursuant to HAMP. [23] ¶ 29. However, a calculation error in the software that Wells Fargo used to determine modification eligibility caused Wells Fargo to erroneously deny a more affordable loan modification to Plaintiff. [23] ¶ 32. Additionally, Wells Fargo employees lost

Plaintiff’s loan modification paperwork on more than one occasion, causing Plaintiff to have to resubmit documents and restart the modification process. Ultimately, Plaintiff was offered a modification that would have resulted in his monthly mortgage payment being reduced by just $150. Plaintiff alleges he was also told, falsely, by Wells Fargo employees that he was required to default on his payments in order to be considered for a loan modification. [23] ¶ 70. On September 24, 2018, Wells Fargo sent Plaintiff a letter informing him that, because of Wells Fargo’s own errors, Plaintiff was wrongly denied a loan modification. [29-1].1 The letter also included a check for $15,000, and an offer to mediate if Plaintiff

did not feel that the $15,000 provided sufficient redress. [29-1]; [23] ¶ 54. Plaintiff alleges that “[a]s a further incentive to cause Plaintiff to agree to mediation, Wells Fargo informed Plaintiff that it would not raise any statute of limitations defense.” [23] ¶ 55. The parties engaged in unsuccessful mediation. On December 5, 2018, a putative nationwide class action was filed against Wells Fargo alleging various forms of misconduct in relation to Wells Fargo’s management of the HAMP process. See [23] ¶ 57; Herandez v. Wells Fargo, N.A., 18-cv-07354 (N.D.

Cal.) (hereinafter “Hernandez”).2 On January 29, 2020, the Hernandez court granted preliminary approval of a nationwide class but denied certification of various state subclasses for violations of their respective state consumer laws and state tort claims. [23] ¶¶ 59-61. Plaintiff excluded himself from the Hernandez class action settlement. [23] ¶ 62. Plaintiff brought this action on February 6, 2024, over five years and four months

after receiving the letter alerting him to Wells Fargo’s error. II. Standard

1 The Court considers the contents of the letter because Plaintiff incorporated it by reference in his complaint. See Brownmark Films, LLC v. Comedy Partners, 682 F.3d 687, 690 (7th Cir. 2012). (“In effect, the incorporation-by-reference doctrine provides that if a plaintiff mentions a document in his complaint, the defendant may then submit the document to the court without converting defendant’s 12(b)(6) motion to a motion for summary judgment.”).

2 Plaintiff urges that Court take judicial notice of the complaint in Hernandez and Defendant does not oppose. [23] ¶ 57. “To survive a motion to dismiss under Rule 12(b)(6), the complaint must provide enough factual information to state a claim to relief that is plausible on its face and raise a right to relief above the speculative level.” Haywood v. Massage Envy

Franchising, LLC, 887 F.3d 329, 333 (7th Cir. 2018) (quoting Camasta v. Jos. A. Bank Clothiers, Inc., 761 F.3d 732, 736 (7th Cir. 2014)); see also Fed. R. Civ. P. 8(a)(2) (requiring a complaint to contain a “short and plain statement of the claim showing that the pleader is entitled to relief”). A court deciding a Rule 12(b)(6) motion “construe[s] the complaint in the light most favorable to the plaintiff, accept[s] all well-pleaded facts as true, and draw[s] all reasonable inferences in the plaintiff’s favor.” Lax, 20 F.4th at 1181. However, the court need not accept as true “statements

of law or unsupported conclusory factual allegations.” Id. (quoting Bilek v. Fed. Ins. Co., 8 F.4th 581, 586 (7th Cir. 2021)). “While detailed factual allegations are not necessary to survive a motion to dismiss, [the standard] does require ‘more than mere labels and conclusions or a formulaic recitation of the elements of a cause of action to be considered adequate.’” Sevugan v. Direct Energy Servs., LLC, 931 F.3d 610, 614 (7th Cir. 2019) (quoting Bell v. City of Chicago, 835 F.3d 736, 738 (7th Cir. 2016)).

Dismissal for failure to state a claim is proper “when the allegations in a complaint, however true, could not raise a claim of entitlement to relief.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 558 (2007). Deciding the plausibility of the claim is “a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” McCauley v. City of Chicago, 671 F.3d 611, 616 (7th Cir. 2011) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009)). III. Analysis Wells Fargo argues that three of Plaintiff’s four counts are barred by the statute of limitations. Separately, Wells Fargo argues that Plaintiff has failed to state a claim

for each count for independent reasons. The parties agree that Illinois law governs each claim. The Court addresses each argument below. A.

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