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Hunt v. Bank of America, N.A.

United States District Court, W.D. Kentucky, Paducah Division

July 12, 2019




         This matter is before the Court upon motion by Defendant, Bank of America, N.A. (“BANA”), for abstention (DN 5) and by Plaintiff, Joshua Hunt, to amend his complaint (DN 8). Both motions are ripe for review. Having reviewed the parties' submissions, and being otherwise sufficiently advised, Plaintiff's motion to amend his complaint (DN 8) is GRANTED and Defendant's motion for abstention (DN 5) is DENIED.


         The factual allegations as set out in the Complaint, [DN 1], and taken as true are as follows.[1]Plaintiff, Joshua Hunt, is an active-duty member of the U.S. military currently stationed at Fort Campbell in Kentucky. (DN 8-1 at 1). Defendant, Bank of America, N.A. (“BANA”), is a national bank headquartered in Charlotte, North Carolina. Id. Although Plaintiff currently resides in Christian County, Kentucky, he owns a house in North Carolina. Id. at 1-2. Defendant holds the first mortgage on Plaintiff's North Carolina house. Id. at 2. Plaintiff alleges that Defendant agreed to defer or suspend Plaintiff's payment obligations on the North Carolina property until January 2020 pursuant to the Servicemembers Civil Relief Act, 50 U.S.C. § 3901 et seq. and Defendant's Supplemental Military Benefits. Id. Plaintiff further alleges that Defendant's representatives repeatedly assured him that Plaintiff did not need to make any payment on the property until January 2020. Id.

         On August 9, 2017, Defendant brought a foreclosure action against Plaintiff in North Carolina state court. Id. at 3. In addition to the foreclosure proceeding, Defendant reported negative credit information concerning Plaintiff to one or more consumer reporting agencies. Id. Upon learning of the negative credit reporting, Plaintiff sent dispute letters to the three major consumer reporting agencies: Equifax Information Services, LLC; Experian Information Solutions, Inc.; and Trans Union, LLC. Id. Plaintiff argues that-because of these dispute letters-Defendant was required to conduct a reasonable investigation of Plaintiff's disputes but failed to do so. Id. at 4. Plaintiff's consumer reports continue to include the negative information that Defendant reported to the credit reporting agencies. Id. Plaintiff claims that Defendant violated the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq. (“FCRA”) by, inter alia, failing to conduct a proper investigation of Plaintiff's disputes filed with Equifax, Experian, and Trans Union. Id.


         (I) Motion to Amend.

         Plaintiff seeks to amend his complaint to eliminate all of Plaintiff's state-law claims, leaving only the federal-law claim for violation of the Fair Credit Reporting Act (“FCRA”). Defendant has filed a notice with the Court that it does not oppose Plaintiff's motion to amend. (DN 11). Federal Rule of Civil Procedure 15(a)(2) provides: “a party may amend its pleading only with the opposing party's written consent or the court's leave” and “[t]he court should freely give leave when justice so requires.” Because Defendant does not oppose the motion, the Court GRANTS Plaintiff's motion for leave to file his amended complaint. (DN 8).

         The Court also grants Defendant's request that the Court extend the time for it to respond to the amended complaint. Defendant shall have twenty-one days from the date that Plaintiff effectuates service of the First Amended Complaint to respond. Furthermore, the Court will rule on Defendant's motion for abstention as if it were filed against the amended complaint because Defendant requests the Court to do so and because Plaintiff limited his opposition to the motion to the FCRA claim.

         (II) Motion for Abstention.

         Defendant moves the Court to abstain from exercising jurisdiction over this case pursuant to the Younger and Colorado River abstention doctrines.[2] As a general rule, federal courts are “obliged to decide cases within the scope of federal jurisdiction. Abstention is not in order simply because a pending state-court proceeding involves the same subject matter.” Sprint Commc'ns, Inc. v. Jacobs, 571 U.S. 69, 72, 134 S.Ct. 584, 187 L.Ed.2d 505 (2013). Although there are circumstances that warrant abstention, such circumstances represent a narrow exception to the “virtually unflagging obligation of the federal courts to exercise the jurisdiction given them.” Romine v. Compuserve Corp., 160 F.3d 337, 339 (6th Cir. 1998) (citation omitted). The Court will address each abstention doctrine individually.

         a. Younger Abstention.

         “Younger abstention derives from a desire to prevent federal courts from interfering with the functions of state criminal prosecutions and to preserve equity and comity.” Doe v. University of Kentucky, 860 F.3d 365, 368 (6th Cir. 2017) (citing Younger v. Harris, 401 U.S. 37, 44, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971)). The Supreme Court has explained, however, that Younger abstention is not limited to state criminal proceedings. Younger abstention may only apply to the following three categories of proceedings: (1) when there is an ongoing state criminal prosecution, (2) when state civil enforcement proceedings that “are akin to criminal prosecutions” are ongoing, and (3) when “civil proceedings that are uniquely in furtherance of the state court's ability to perform their judicial functions, ” such as contempt orders, are ongoing. Sprint, 571 U.S. at 73; New Orleans Pub. Serv., Inc. v. Council of City of New Orleans, 491 U.S. 350, 368, 109 S.Ct. 2506, 105 L.Ed.2d 298 (1989) (“NOPSI”).

         If a proceeding falls within one of the three NOPSI categories, then the Court must evaluate the matter using the three-factor test provided by Middlesex County Ethics Committee v. Garden State Bar Ass'n,457 U.S. 423, 102 S.Ct. 2515, 73 L.Ed.2d 116 (1982). “The Middlesex test states that abstention may occur when three criteria are met: (1) state proceedings are currently pending; (2) the proceedings involve an important state interest; and (3) the state proceedings will provide the federal plaintiff ...

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