CourtListener opinion 10726178

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IN THE UNITED STATES DISTRICT COURT 
 FOR THE NORTHERN DISTRICT OF WEST VIRGINIA 

WILLIAM PATTERSON and 
ERICA PARENTI, 

 Plaintiffs, 

v. CIVIL ACTION NO. 1:21CV126 
 (Judge Keeley) 

NEWREZ LLC f/k/a NEW PENN 
FINANCIAL, LLC d/b/a SHELLPOINT 
MORTGAGE SERVICING; US BANK 
TRUST NATOINAL ASSOCIATE AS OWNER 
TRUSTEE FOR VRMA ASSET TRUST; and 
KAY DAVID 

 Defendants. 

 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 Seeking to avoid foreclosure of their home, the plaintiffs, 
William Patterson ("Patterson") and Erica Parenti ("Parenti") 
(collectively, "the Plaintiffs"), sued the defendants, NewRez LLC 
f/k/a New Penn Financial LLC d/b/a Shellpoint Mortgage Servicing 
("Shellpoint"), US Bank Trust National Association as Owner 
Trustee for VRMTG Asset Trust ("US Bank Trust"), and Kay David 
("David") for predatory lending and abusive loan servicing 
practices regarding their mortgage (Dkt. No. 5 at 5). They filed 
suit in the Circuit Court of Monongalia County, West Virginia on 
August 17, 2021. Id. at 1. On the following day, when the 
foreclosure sale was scheduled to occur, the state court granted 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
the Plaintiffs' emergency motion for a preliminary injunction. Id. 
at 32-34. 
 On September 17, 2021, Shellpoint and US Bank Trust ("the 
corporate defendants") removed the case to this Court based on 
diversity of citizenship between themselves and the Plaintiffs 
(Dkt. No. 1 at 3-8). Pursuant to Federal Rule of Civil Procedure 
12(b)(6), they jointly moved to dismiss the Plaintiffs' complaint 
(Dkt. No. 6). On October 8, 2021, pursuant to 28 U.S.C, § 1447, 
the Plaintiffs moved to remand the case to state court (Dkt. No. 
9). 
 The issues in dispute have been fully briefed, and the Court 
has heard oral argument on the pending motions. After careful 
consideration, for the reasons that follow the Court DENIES the 
Plaintiffs' motion to remand (Dkt. No. 9), DISMISSES David as a 
defendant, and GRANTS-IN-PART and DENIES-IN-PART the corporate 
defendants' motion to dismiss (Dkt. No. 6). 
 I. Factual Allegations 
 As it must, the Court construes the following facts in the 
light most favorable to the Plaintiffs. See De'Lonta v. Johnson, 
708 F.3d 520, 524 (4th Cir. 2013). In 2005, the Plaintiffs received 
a plot of land from Erica Parenti's family on which they planned 
to build a home (Dkt. No. 5 at 5-6). They obtained a $100,000 loan 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
with a 30-year term and 5.75% interest rate from First United Bank. 
Id. at 6. Shortly thereafter, the Parenti family placed a second 
deed of trust and a $35,000 lien on the Plaintiffs' land. Id. at 
7. Later, in December 2005, using a $65,000 loan with a 6.89% 
interest rate from BB&T, Patterson financed the purchase of an 
adjoining property. Id. 
 In 2007, in an effort to lower their monthly expenses, the 
Plaintiffs responded to an advertisement by Advanced Financial 
Services, Inc. ("AFS") and decided to consolidate and refinance 
their First United and BB&T loans. Id. On June 26, 2007, the 
defendant David, a notary, came to the Plaintiffs' home to close 
that loan. Id. at 8. She instructed them where to sign the loan 
documents but "did not provide a meaningful opportunity for [them] 
to understand the transaction." Id. 
 The Plaintiffs' newly consolidated loan was in the amount of 
$185,000, with an interest rate of 6.875% and a 30-year term. Id. 
It also included a "settlement charge" of $9,432.02 and a "cash 
out" of $8,108.63, which were unanticipated charges that increased 
the amount of money the Plaintiffs owed. Id. at 7. Following 
consolidation, the First United lien was paid and released, and 
the BB&T lien was paid, but not released. Id. The Parenti family 
lien, however, was neither paid nor released. Id. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 Almost nine (9) years later, on February 10, 2016, the 
Plaintiffs modified their consolidated loan to extend its term for 
an additional forty (40) years, and also to add Parenti as a 
borrower. Id. A month later, Patterson lost his job and, 
eventually, the Plaintiffs were unable to make their monthly loan 
payments. Id. Their loan had been in arrears for six (6) months 
when Shellpoint began servicing it on June 16, 2017. Id. 
 In order to bring the loan current, Shellpoint instructed 
Parenti to apply for a loan modification, which she did. Id. at 9. 
And although the Plaintiffs repeatedly submitted certain documents 
in support of their loan modification, Shellpoint ultimately 
denied their application for lack of documentation on April 2, 
2018. Id. 
 After that denial, the Plaintiffs reapplied for a loan 
modification, but Shellpoint again denied their application for 
lack of documentation in December 2018. Id. Finally, on February 
27, 2019, Shellpoint denied the Plaintiffs' third application 
based on their failure to meet the requirements for assistance. 
Id. at 10. The Plaintiffs contend that none of these denials 
contained the disclosures required by law. Id. 
 Although the Plaintiffs continued to request assistance in an 
effort to bring their loan current, Shellpoint refused to speak 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
with Parenti and failed to respond to the Plaintiffs' 
correspondence. Id. Shellpoint also refused the Plaintiffs' offers 
to make lump sum payments on the loan while applications to modify 
their loan payments were pending, nor would it inform the 
Plaintiffs of the total amount they were in arrears. Id. at 11. 
 On September 30, 2019, the corporate defendants sought 
judgment in state court directing release of the three prior deeds 
of trust on the Plaintiffs' property resulting from the First 
United loan, the BB&T loan, and the Parenti family loan. Id. at 
12. Although they named both the Plaintiffs and the Parenti family 
as defendants, they only notified the Parenti family of the suit. 
Id. The Plaintiffs nevertheless learned of the action and contacted 
the corporate defendants, who advised that they need not respond 
to the petition. Id. 
 The Parenti family deed of trust had been filed after the 
First United deed of trust, but before the AFS deed of trust. Id. 
at 12-13. Although no proceeds from the Plaintiffs' consolidated 
loan had ever gone toward satisfying the outstanding Parenti family 
loan, the corporate defendants nevertheless represented to the 
state court that the First United loan, the BB&T loan, and the 
Parenti family loan each had been paid in full. Id. Eventually, on 
February 11, 2021, the state court granted default judgment against 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
the Plaintiffs and the Parenti family and released all three deeds 
of trust. Id. 
 Following the state court's action, on May 26, 2021, pursuant 
to the federal Real Estate Settlement Procedures Act and the West 
Virginia Consumer Credit Protection Act, the Plaintiffs sent a 
request for information, notice of error, and notice of opportunity 
to cure to Shellpoint. Id. at 13. Shellpoint partially responded 
to this request and attempted to charge the Plaintiffs a processing 
fee to avoid foreclosure. Id. Ultimately, however, after 
Shellpoint refused to enter into a repayment plan with them, the 
Plaintiffs filed suit in order to avoid foreclosure. Id. 
 The complaint asserts that although US Bank Trust claims to 
have been assigned the loan and Shellpoint claims to be the 
servicer of the loan neither can establish the proper chain of 
title authorizing them to foreclose on the loan. Id. at 8. It 
alleges twelve causes of action against the defendants, including 
illegal mortgage, unauthorized practice of law, unconscionability, 
fraud, action to quiet title, joint venture and agency, 
misrepresentations, unconscionable conduct, refusal to apply 
payments, fraud, tortious interference with contract, and breach 
of contract. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 II. Plaintiffs' Motion to Remand 
 Following removal by the corporate defendants, the Plaintiffs 
moved to remand the case to state court on the basis that (1) the 
corporate defendants failed to obtain David's consent to removal, 
and (2) the Plaintiffs and David, all of whom are West Virginia 
residents, are not diverse (Dkt. No. 9). The corporate defendants 
oppose remand, asserting that the Plaintiffs fraudulently joined 
David as a defendant (Dkt. No. 13 at 3). 
 A. Rule of Unanimity 
 Pursuant to 28 U.S.C. § 1446(b), a defendant must file its 
notice of removal within 30 days following receipt of the initial 
pleading or summons, and "all defendants who have been properly 
joined and served must join in or consent to the removal of the 
action." Here, as the Plaintiffs contend, the corporate defendants 
did not satisfy this so-called rule of unanimity (Dkt. No. 9-1 at 
4-5). Although each defendant accepted service on August 19, 2021 
(Dkt. No. 5 at 2), the corporate defendants did not obtain David's 
consent prior to filing their notice of removal on September 17, 
2021 (Dkt. Nos. 1 at 9-10; 13 at 3). Typically, this omission would 
require remand, but the corporate defendants contend they are 
exempt from this requirement because the Plaintiffs fraudulently 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
joined David as a defendant when they filed suit (Dkt. No. 1 at 9- 
10; 13 at 3). 
 B. Fraudulent Joinder 
 It is axiomatic that when an action is removed from state 
court the receiving federal district court must determine whether 
it has original jurisdiction over the plaintiff's claims. Kokkonen 
v. Guardian Life Ins. Co. Of Am., 511 U.S. 375, 377 (1994) 
("Federal courts are courts of limited jurisdiction" and possess 
"only that power authorized by Constitution and statute."). If 
removal is based on diversity of citizenship under 28 U.S.C. § 
1332, the removing party bears the burden of establishing that 
"the amount in controversy exceeds the sum or value of $75,000, 
exclusive of interests and costs, and is between citizens of 
different states." 28 U.S.C. § 1332. Courts should resolve any 
doubt "about the propriety of removal in favor of retained state 
court jurisdiction." Marshall v. Manville Sales Corp., 6 F.3d 229, 
232-33 (4th Cir. 1993). 
 The Plaintiffs concede that the amount in controversy 
requirement has been satisfied because they owe more than $75,000 
towards the consolidated loan (Dkt. No. 1 at 4). They also agree 
that diversity exists between them and the corporate defendants; 
they are citizens of West Virginia, Shellpoint is a citizen of 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
Delaware and New York,1 and US Bank Trust is a citizen of Delaware2 
(Dkt. Nos. 5 at 6; 1 at 5-6). But they argue that the Court lacks 
jurisdiction to hear the case because defendant David is a citizen 
of West Virginia (Dkt. No. 9-1 at 5-6). The corporate defendants 
contend that the Court should disregard David's citizenship, 
claiming she has been fraudulently joined (Dkt. No. 1 at 6-9). 
 The doctrine of fraudulent joinder is a narrow exception to 
the requirement of complete diversity. Jackson v. Allstate Ins. 
Co., 132 F. Supp. 2d 432, 433 (N.D.W. Va. 2000). When applicable, 
it allows the Court to disregard the citizenship of, and dismiss, 
a non-diverse defendant. Mayes v. Rapoport, 198 F.3d 457, 461 (4th 
Cir. 1999)). Thus, if the doctrine applies the Court may retain 
jurisdiction even though a non-diverse party has been named a 
defendant. Jackson, 132 F. Supp. 2d at 433. 
 The removing party bears the "heavy burden of showing that 
there is no possibility of establishing a cause of action against 
[a] non-diverse party" by clear and convincing evidence. Jackson, 
132 F. Supp. 2d at 433 (citing Hartley v. CSX Transp. Inc., 187 
F.3d 422, 424 (4th Cir. 1999)). Alternatively, the removing party 

1 Shellpoint is a Delaware limited liability company whose members 
include Delaware limited liability companies and a Delaware corporation 
with a principal place of business in New York (Dkt. No. 5 at 6). 
2 US Bank Trust is a national association with its principal place of 
business in Delaware (Dkt. No. 5 at 6). 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
can establish that "there has been outright fraud in the 
plaintiff's pleading of jurisdictional facts." Pritt v. Republican 
Nat. Committee, 1 F. Supp. 2d 590, 592 (S.D.W. Va. 1998). 
 The standard for fraudulent joinder is more favorable to a 
plaintiff than the standard for dismissal on a Rule 12(b)(6) 
motion. Mayes, 198 F.3d at 464. "Plaintiff need only have a slight 
possibility of a right to relief against a non-diverse defendant 
for jurisdiction to be improper in federal court. If a court 
identifies a glimmer of hope for the plaintiff's claim, then the 
jurisdictional inquiry ends." Bledsoe v. Brooks Run Mining Co., 
LLC, 2011 WL 5360042, at *1 (S.D.W. Va. Nov. 4, 2011) (citation 
omitted). The Court must resolve all issues of fact and law in the 
plaintiff's favor, but in doing so "is not bound by the allegations 
of the pleadings." Marshall, 6 F.3d at 232-33; AIDS Counseling and 
Testing Ctrs. v. Grp. W Television, Inc., 903 F.3d 1000, 1004 (4th 
Cir. 1990). Instead, it can consider "the entire record, and 
determine the basis of joinder by any means available." Id. at 
1004 (internal citation omitted). 
 Because the corporate defendants have not alleged outright 
fraud in the Plaintiffs' pleading, they must show by clear and 
convincing evidence that there is no possibility that the 
Plaintiffs can establish a cause of action against David. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 C. No Possibility of Relief Against David 
 David is named as a defendant in Counts One through Six of 
the complaint, which state claims for illegal mortgage, 
unauthorized practice of law, unconscionability, fraud, action to 
quiet title, and joint venture and agency (Dkt. No. 5 at 10-14). 
The corporate defendants contend that only Count 2, alleging the 
unauthorized practice of law, is properly asserted against David 
(Dkt. No. 1 at 5-9) and they challenge this claim, first on the 
basis that it is time-barred, and second that, as pleaded, David's 
actions do not constitute the practice of law under governing West 
Virginia law (Dkt. No. 13 at 4-7). The Court will address each of 
these arguments in turn. 
 i. Timeliness 
 Countering the corporate defendants' argument that their 
unauthorized practice of law claim against David is time-barred 
(Dkt. No. 13 at 6-7), the Plaintiffs contend that the Court should 
not consider the timeliness of their claim because it is an 
affirmative defense that has been waived by David, or alternatively 
find that their claim is timely under the doctrine of laches. They 
argue that the corporate defendants cannot challenge their 
unlawful practice of law claim as untimely because only David, the 
party affected by the claim, may raise this affirmative defense 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
and she has waived the right to do so (Dkt. No. 9-1 at 7). In 
support, they rely on dicta from a West Virginia case, Kinsinger 
v. Pethel, 766 S.E.2d 410 (W. Va. 2014). 
 In Kinsinger, after the respondent transferred assets out of 
a marital Thrift Savings Plan ("TSP"), the petitioner, his former 
wife, sought to hold him in contempt of a Qualified Domestic 
Relations Order ("QRDO") entered by the family court. Id. at 412. 
The family court declined to hold the respondent in contempt 
because the petitioner had not timely filed the QDRO.3 Id. The 
circuit court affirmed this ruling as a proper application of the 
doctrine of laches. Id. at 413. The petitioner appealed this 
decision to the Supreme Court of Appeals of West Virginia, which 
reversed the lower courts' decisions, finding an erroneous 
application of the doctrine of laches where neither court had made 
the requisite determinations of harm or prejudice to the 
respondent. Id. at 413, 415. 
 In a footnote, the Supreme Court observed in passing that the 
order of the family court had not discussed the doctrine of laches 

3 Specifically, the parties had agreed in a final order of divorce that 
the petitioner would receive half of the funds in a TSP if she prepared 
a QRDO. Id. at 412. Three years later, the respondent withdrew all funds 
from the marital TSP and opened a new TSP. Id. Three years after that, 
and six years after the entry of the divorce order, the petitioner 
finally filed a QRDO seeking her portion of the TSP funds. Id. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
because the respondent had never asserted it as a defense. Id. at 
n.3. And the same footnote stated that "the doctrine of laches is 
moot unless the affected party raises it as a defense," id. at 
n.3, citing State, Dep't of Health & Hum. Res., Child Advoc. Off. 
on Behalf of Robert Michael B. v. Robert Morris N., 466 S.E.2d 
827, 834 (W. Va. 1995) (holding that, because a petitioner had not 
pleaded or proven the defense of laches before a family law master, 
he could not raise the defense for the first time on appeal). 
 The Plaintiffs suggest that both Kinsinger and Michael B. bar 
the corporate defendants from raising the defense of laches where 
David failed to do so. But neither Kinsinger nor Michael B. 
addresses whether a defendant may assert the doctrine of laches on 
another party's behalf where it stands to benefit from the defense. 
And neither contains a syllabus point requiring that a particular 
defendant must assert the defense. Rather, these cases instruct 
(1) that a court may not to raise the doctrine of laches sua 
sponte, and (2) that a defendant cannot raise the defense of laches 
for the first time on appeal. 
 Neither scenario exists here. The Court has not raised the 
doctrine sua sponte. Moreover, the corporate defendants stand to 
benefit from application of the doctrine given that whether Count 
2 has been timely asserted is determinative of their fraudulent 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
joinder argument. Therefore, the defense of laches is timely and 
may properly be asserted by the corporate defendants in this case. 
 Other federal courts in West Virginia have reached the same 
conclusion in similar circumstances. See, for example, May v. 
Nationstar Mortg., LLC, No. 3:12-CV-43, 2012 WL 3028467, at *1 
(N.D.W. Va. July 25, 2012), where, in order to establish 
fraudulently joinder, the defendant mortgage company argued that 
the plaintiff's unauthorized practice of law claim against the 
individual defendant was time-barred. 
 During oral argument in this case, the Plaintiffs attempted 
to distinguish May, asserting that, unlike the individual 
defendant there, David has appeared and filed an answer in this 
case. Although the parties dispute whether David actually has 
appeared in this case,4 the Court need not resolve the question 
since the individual defendant in May had appeared by counsel, 
consented to removal of the case to federal court, and moved to 
dismiss the plaintiffs' claims. See May, No. 3:12-CV-43, Dkt. Nos. 
16, 17, 28. 

4 Upon being served with the summons and complaint in this case, David 
responded to several of the Plaintiffs' allegations via letter to the 
Plaintiffs' counsel. Counsel in turn mailed David's letter to the Circuit 
Clerk of Monongalia County "in the event that the Court wishe[d] to 
consider it as an Answer in this litigation" (Dkt. No. 5 at 2, 44, 45). 
Thereafter, the Clerk filed this letter as "Answer of M. Kay David (pro 
se)." Id. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 The Court turns next to the timeliness of the Plaintiffs' 
unauthorized practice of law claim, under either the applicable 
statute of limitations or the doctrine of laches. "A claim seeking 
damages for the unauthorized practice of law is governed by a two- 
year statute of limitations." Heavener v. Quicken Loans, Inc., No. 
3:12-CV-68, 2013 WL 2444596, at *5 (N.D.W. Va. June 5, 2013) 
(citing W. Va. Code § 51-2-12)). Here, as the corporate defendants 
assert, the Plaintiffs' claim is time-barred where their loan 
closing occurred in 2007 but they failed to bring their claim until 
2021. 
 Laches applies to claims seeking equitable relief. See Syl. 
Pt. 2, Condry v. Pope, 166 S.E.2d 167, 167 (W. Va. 1969); Dunn v. 
Rockwell, 689 S.E.2d 255, 266 (W. Va. 2009). For laches to bar a 
claim, a defendant must prove that it has been prejudiced by the 
plaintiff's lack of diligence in bringing the action. See White v. 
Daniel, 909 F.2d 99, 102 (4th Cir. 1990). 
 Count 2 of the Plaintiffs' complaint seeks an injunction 
against David to prevent her from committing further acts 
constituting the unauthorized practice of law (Dkt. No. 5 at 13). 
As the claim has been pleaded in equity, under West Virginia law 
the doctrine of laches applies. Dunn, 689 S.E.2d at 255. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 Courts in this District have recognized that, because "equity 
follows the law," they may presume that a defendant would be 
prejudiced by a plaintiff's failure to bring an equitable claim 
within the statute of limitations applicable to an analogous action 
at law. May, 2012 WL 3028467, at *7 (citing Consolidation Coal Co. 
v. Consolidation Coal Co., Inc., 228 F. Supp. 2d 764, 768–69 
(N.D.W. Va. 2001)). This rule has been applied to presume prejudice 
in circumstances similar to those in this case. See, e.g., May, 
2012 WL 3028467, at *1 ("Because May failed to file the instant 
action until almost eight years after the closing, this Court 
presumes that Chambers would be prejudiced by allowing May to seek 
equitable relief on a claim for the unauthorized practice of 
law."); Heavener v. Quicken Loans, Inc., No. 3:12-CV-68, 2013 WL 
2444596, at *5 (N.D.W. Va. June 5, 2013) ("Plaintiff waited almost 
five years after he executed the loan documents at issue before 
filing this action. This Court presumes that Defendant Quicken 
Loans would be prejudiced by allowing Plaintiff to seek equitable 
relief on a claim for the unauthorized practice of law."); Litten 
v. Quicken Loans, Inc., No. 1:13CV192, 2013 WL 6001256, at *6 
(N.D.W. Va. Nov. 12, 2013) (presuming that the defendant would be 
prejudiced by allowing the plaintiffs to seek equitable relief for 
fraud nearly six years after they received a copy of all signed 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
loan documents and four years after the analogous statute of 
limitations would have expired). 
 Here, the passage of time is lengthy. It has been more than 
fourteen (14) years since David's unauthorized practice of law 
allegedly occurred. Moreover, David has had no connection to the 
Plaintiffs or their consolidated loan since 2007. Thus, applying 
a presumption that she would be prejudiced if the Plaintiffs were 
permitted to pursue equitable relief on such a stale claim is 
reasonable. Based on this presumption, the court concludes that 
the Plaintiffs' claim against David for the unauthorized practice 
of law is time-barred under the doctrine of laches.5 

5 The Plaintiffs argue, for the first time in their reply brief, that 
the Court should reject the corporate defendants' timeliness challenge 
to Count 2 based on the common defense rule. (Dkt. No. 15 at 6). Because 
"[t]he ordinary rule in federal courts is that an argument raised for 
the first time in a reply brief or memorandum will not be considered," 
Clawson v. FedEx Ground Package Sys., Inc., 451 F. Supp. 2d 731, 734 (D. 
Md. 2006), the Court is not required to address this argument. Even so, 
it lacks merit. 
 The common defense rule provides that "removal of a state claim is 
impermissible when the legal theory upon which the defendant's claim of 
fraudulent joinder is predicated is a common defense that equally 
disposes of all defendants to the suit." McDowell Pharmacy, Inc. v. W. 
Virginia CVS Pharmacy, L.L.C., No. 1:11-CV-0606, 2012 WL 2192167, at *5 
(S.D.W. Va. June 14, 2012). Notably, the Fourth Circuit has not adopted 
this rule. But the Fifth Circuit has explained the rule thusly: 

 [W]hen, on a motion to remand, a showing that compels a 
 holding that there is no reasonable basis for predicting that 
 state law would allow the plaintiff to recover against the 
 in-state defendant necessarily compels the same result for 
 the nonresident defendant, there is no improper joinder; 
 there is only a lawsuit lacking in merit. In such cases, it 
 makes little sense to single out the in-state defendants as 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 ii. No Possibility of Relief Under West Virginia Law 
 Even had the Plaintiffs timely filed their unauthorized 
practice of law claim against David, it would not be viable under 
governing West Virginia law. It is undisputed that David is a non- 
attorney notary who conducted the closing of the consolidated loan 
at the Plaintiffs' home (Dkt. No. 5 at 6). Her only task was to 
direct them where to sign the documents. Id. She answered no 
questions. And, because she could not answer their questions, the 
Plaintiffs now claim that they were deprived of a meaningful 
opportunity to understand the transaction. Id. at 13. At bottom, 
whether David's alleged actions constitute the unauthorized 
practice of law turns on which advisory opinion from the Unlawful 
Practice of Law Committee ("UPLC") of the West Virginia State Bar 
governs this case. 
 In 2003, the UPLC issued Advisory Opinion 2003-01, addressing 
"whether real estate closings conducted by lay persons constitute 

 "sham" defendants and call their joinder improper. In such 
 circumstances, the allegation of improper joinder is actually 
 an attack on the merits of plaintiff's case ... 

Smallwood v. Illinois Cent. R.R. Co., 385 F.3d 568, 574 (5th Cir. 2004). 
 But the common defense rule does not bar the corporate defendants 
from arguing that Count 2 against David is untimely under the doctrine 
of laches. Such challenge is not an attack on the merits of the 
Plaintiffs' case against the corporate defendants and the Plaintiffs 
have made clear that David is the only defendant against whom Count 2 
has been asserted. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
the unauthorized practice of law" (Dkt. No. 9-4 at 3). It stated 
that a lay person is deemed to be practicing law whenever she (1) 
advises another in any matter involving the application of legal 
principles to facts, purposes, or desires; (2) prepares legal 
documents for another; or (3) represents the interest of another 
before a judicial tribunal. Id. at 4. The UPLC also noted that a 
variety of activities may occur at a real estate closing, including 
"[a]ttending the closing and obtaining appropriate signatures on 
documents" and "attending the closing and answering buyer and/or 
seller questions about documents and/or the transaction." Id. It 
then concluded that "generally, real estate closings constitute 
the practice of law," and that lay persons conducting real estate 
closings have engaged in the unauthorized practice of law. Id. at 
5. 
 Notably, the advisory opinion recognized that some clerical 
functions may occur during a closing, including "simple execution 
of documents." Id. at 4-5. It then concluded that "in general, 
legal principles are applied to the factual situation to determine 
if and how the transaction should be conducted[,]" because "it is 
inherent at the closing itself that buyers and sellers will have 
questions about the transaction and documents, which answers 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
necessarily go to their respective legal rights and obligations. 
Such answers are advising on legal matters." Id. 
 Later, in 2010, after receiving numerous complaints regarding 
the practice of law by lay persons at real estate closings, the 
UPLC issued Advisory Opinion 2010-002, clarifying that some 
activities routinely performed in real estate settings by non- 
lawyers constituted the practice of law. In doing so, it adopted 
a Stipulation and Agreed Order in the case of McMahon v. Advanced 
Title Services, No. 01–C–121 (Cir. Ct. Brooke Co., Mar. 31, 2010), 
which incorporated and clarified the 2003 principles as follows: 
 It is the practice of law for a person to conduct a real 
 estate closing (including "witness-only" or "witness" 
 closings) for mortgage financing or real estate 
 transaction, to or for the general consumer public or 
 any third-party when part of his or her responsibilities 
 as closing agent consist of: (1) explaining, 
 interpreting, giving an opinion and/or advising another 
 on the meaning of terms of principles (legal or 
 otherwise) relevant to the mortgage transaction, or in 
 matters involving the application of legal principles to 
 particular facts, purposes, or desires; (2) instructing 
 clients in the manner in which to execute legal 
 documents; or (3) preparing the HUD-1 Settlement 
 Statement, and at times, other instruments related to 
 mortgage loans and transfers of real property . . . . 

Id. at 15. Significantly, "the settlement agent may not present 
important legal documents to the seller, buyer, borrower, and/or 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
lender at closing without legal questions being asked and without 
giving legal advice." Id. at 16. 
 The Plaintiffs rely on both the 2003 and 2010 advisory 
opinions to argue that David's alleged actions constitute the 
practice of law (Dkt. No. 9-1 at 9-11). The corporate defendants, 
however, contend that, under the 2003 advisory opinion, David 
performed only clerical tasks (Dkt. No. 13 at 5-6). Because it 
agrees with the corporate defendants that the 2010 advisory opinion 
is not retroactive, May, 2012 WL 3028467, at *7, the Court must 
assess David's actions as the closing agent in 2007 under the 
standard articulated in the 2003 advisory opinion. 
 Other courts in this district have considered this question. 
In May v. Nationstar Morg., LLC, the plaintiff alleged that the 
defendant was a notary who instructed them where to sign, notarized 
the loan documents, but could not answer their questions about the 
documents. 2012 WL 3028467 at *7. The court concluded that the 
plaintiffs had no possible claim for the unauthorized practice of 
law because these services were ministerial rather than legal. Id. 
Likewise, in Shelton v. Wells Fargo Bank, the court concluded that 
the defendant, who had served as the closing agent on the 
plaintiff's loan, had not engaged in the practice of law where the 
plaintiff "set forth no evidence that she ever asked or that the 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
defendants ever provided any legal advice at the closing." 2010 WL 
10152301 (N.D.W. Va. 2010). 
 Here, the Plaintiffs allege that David, a "notary public who 
engages in real estate closings," "simply instructed [them] where 
to sign the documents and did not provide a meaningful opportunity 
for [them] to understand the transaction." But under the 2003 
advisory opinion such allegations do not constitute a claim against 
David for the unauthorized practice of law because they allege 
only that she completed ministerial tasks. There is no allegation 
that she advised the Plaintiffs on the law or about their rights 
and obligations under the loan. And even if such ministerial tasks 
arguably constitute the practice of law under the 2010 advisory 
opinion, they clearly do not do so under the 2003 advisory opinion. 
The Plaintiffs therefore have no possibility of relief against 
David for the unauthorized practice of law in connection with the 
2007 loan closing at issue in this case. 
 iii. Other Counts Against David 
 The Plaintiffs nevertheless contend they have other viable 
claims against David. These include illegal mortgage (Count 1), 
unconscionability (Count 3), fraud (Count 4), action to quiet title 
(Count 5), and joint venture and agency (Count 6) (Dkt. No. 9-1 at 
n.1). The parties' arguments in this regard focus on whether the 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
Plaintiffs have pleaded a viable claim against David for joint 
venture and agency. The Plaintiffs argue that, "as a joint venturer 
or agent in the origination of the loan," David participated "in 
a scheme to induce Plaintiffs into the illegal loan based on 
fraudulent and illegal conduct." Id. The corporate defendants 
contend that, although not properly alleged in the complaint, the 
Plaintiffs are attempting to "use this joint venture theory as a 
way to back-door other claims against David in order to avoid 
federal court jurisdiction" (Dkt. No. 13) (cleaned up). They 
contend that, on close examination of the facts, it is impossible 
to establish that an agency relationship existed between either of 
them and David pointing to the obvious facts that David closed the 
consolidated loan in 2007, Shellpoint did not begin servicing the 
loan until 2017, and US Bank Trust was not assigned the loan until 
2021 (Dkt. No. 13 at 7-8). 
 Federal Rule of Civil Procedure 12(b)(6) allows a defendant 
to seek dismissal if a complaint does not state a claim upon which 
relief can be granted. "[A] complaint must contain ‘enough facts 
to state a claim to relief that is plausible on its face.'" 
Anderson, 508 F.3d at 188 n.7 (quoting Twombly, 550 U.S. at 547). 
To satisfy this standard, a complaint must contain "more than 
labels and conclusions, and a formulaic recitation of the elements 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
of a cause of action will not do." Bell Atl. Corp. v. Twombly, 550 
U.S. 544, 555 (2007). 
 A joint venture "is an association of two or more persons to 
carry out a single business enterprise for profit, for which 
purpose they combine their property, money, effects, skill[,] and 
knowledge." Armor v. Lantz, 535 S.E.2d 737, 742 (W. Va. 2000) 
(quoting Price v. Halstead, 355 S.E.2d 380, 384 (W. Va. 1987)). To 
be a member of a joint venture an individual must make some 
contribution to the enterprise and assert some control over the 
venture. Bennett v. Lending Sols. Inc., 2011 WL 4596973, at *3 
(S.D.W. Va. Sept. 30, 2011) (citations omitted). Each member of a 
joint venture is liable for unlawful acts of the other members if 
committed within the scope of the venture and with the other 
members' implied consent. Short v. Wells Fargo Bank Minn., N.A., 
401 F. Supp. 2d 549, 563 (S.D.W. Va. 2005). 
 In their motion to remand, the Plaintiffs argue that 
 Defendant David had an agreement with the lender to 
 engage in the business enterprise of the closing the 
 loan at issue; that Defendant David shared in the profits 
 of this enterprise with the lender, that is, the fees 
 collected for closing the loan; that Defendant David 
 used her purported "skill" as the loan closer to carry 
 out the enterprise; and that the actions were done with 
 a joint purpose to further the enterprise of the loan 
 closing. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
(Dkt. No. 9-1 at n.1). But their complaint is devoid of any facts 
to support a joint venture claim against David. From the bare 
allegation that the defendants' "single business enterprise" was 
"the closing of the sale and financing of the home at issue in 
this case," the Plaintiffs conclusively assert that "the acts of 
[David] were conducted as part of the principal-agency 
relationship between the Defendants" (Dkt. No. 5 at 15-16). The 
remaining allegations in the complaint merely recite the elements 
of a joint venture claim. 
 The corporate defendants persuasively argue that there is no 
evidence of any affiliation between David and either of them, or 
that she acted as their agent at a loan closing a decade before 
either was connected to the Plaintiffs' loan. David may have been 
an agent of AFS, the loan originator, but AFS is not a defendant 
in this action. The Plaintiffs thus have failed to plausibly plead 
a joint venture and agency claim against David. 
 There being no possibility of relief against David, the Court 
concludes she has been fraudulently joined and that the corporate 
defendants were not required to obtain her consent to remove this 
case. It therefore DENIES the Plaintiffs' motion to remand (Dkt. 
No. 9), and will dismiss David as a defendant from this action, 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
disregard her West Virginia citizenship, and retain jurisdiction 
over this case. Mayes, 198 F.3d at 461. 
 III. Corporate Defendants' Motion to Dismiss 
 The Court turns next to consider the corporate defendants' 
motion to dismiss. Shellpoint has moved to dismiss Counts 1 through 
6, while US Bank Trust seeks to dismiss the entire complaint (Dkt. 
No. 6). The Plaintiffs assert that the Court should deny the 
corporate defendants' motions under the law of the case doctrine 
(Dkt. No. 10 at 2, 12-13). 
 A. Law of the Case Doctrine Inapplicable 
 When the state court granted the Plaintiffs' emergency motion 
seeking a preliminary injunction to prevent the sale of their 
property, it adopted the following language proposed by the 
Plaintiffs: 
 Plaintiffs have demonstrated a likelihood of success on 
 the merits on the claims set forth in their Complaint, 
 including their assertions that the foreclosure is 
 improper because there is not adequate chain of title, 
 the deed of trust is void due to fraud, 
 unconscionability, and/or illegality; and that the 
 continued delinquency leading to the foreclosure was 
 caused by Defendants' actions. 

(Dkt. No. 5 at 30). The Plaintiffs contend that this language 
precludes the corporate defendants' challenges to their complaint. 
The Court disagrees. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 A preliminary injunction preserves the status quo between the 
parties until a trial on the merits can be held. Ne. Nat. Energy 
LLC v. Pachira Energy LLC, 844 S.E.2d 133, 141 (W. Va. 2020). Under 
West Virginia law, when granting or refusing a request for an 
injunction, state courts must consider the circumstances 
surrounding the case, including "the nature of the controversy, 
the object for which the injunction is being sought, and the 
comparative hardship or convenience to the respective parties 
involved in the award or denial of the writ." Syl. Pt. 4, State ex 
rel. Donley v. Barker [Baker], 164 S.E. 154 (W. Va. 1932). To 
balance the hardship to the parties, courts also must consider 
"(1) the likelihood of irreparable harm to the plaintiff without 
the injunction; (2) the likelihood of harm to the defendant with 
an injunction; (3) the plaintiff's likelihood of success on the 
merits; and (4) the public interest." State ex rel. E. End Ass'n 
v. McCoy, 481 S.E.2d 764, 778–79 (W. Va. 1996). 
 The law of the case doctrine recognizes that "when a court 
decides upon a rule of law, that decision should continue to govern 
the same issues in subsequent stages in the same case." Arizona v. 
California, 460 U.S. 605, 618 (1983). But because this doctrine 
was "crafted with the course of ordinary litigation in mind," 
Arizona, 460 U.S. at 618–19, it does not bar courts from assessing 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
"past holdings based on a different procedural posture" or from 
applying the proper standard of review at a subsequent stage of 
the litigation. Graves v. Lioi, 930 F.3d 307, 341 (4th Cir. 2019). 
Relevant to this case, courts have "refuse[d] to apply the law- 
of-the-case-doctrine to a ruling at the preliminary injunction 
stage unless the ruling was based on a pure issue of law." Wells 
Fargo Bank, Nat'l Ass'n v. Worldwide Shrimp Co., 2017 WL 7689635, 
at *6 (N.D. Ill. Dec. 29, 2017) (collecting cases). 
 In this case, the law of the case doctrine does not prevent 
the Court from ruling on the corporate defendants' motion to 
dismiss. In the first place, the state court's decision to grant 
the Plaintiffs' request for a preliminary injunction occurred at 
a time when the Plaintiffs were threatened with foreclosure of 
their property. That decision thus was not a purely legal decision 
to which the law of the case doctrine applies. Wells Fargo Bank, 
2017 WL 7689635, at *6. 
 Moreover, the law of the case doctrine does not prevent the 
Court from applying the proper legal standard when reviewing a 
motion to dismiss, even though a preliminary injunction is in 
place. Graves, 930 F.3d at 341. Here, the pending motions present 
questions distinct from those addressed by the state court. 
Although the state court weighed the Plaintiffs' chance of success 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
on the merits of their claims as a factor in deciding whether to 
grant a preliminary injunction, it further considered the exigent 
circumstance of the impending sale of their property and the 
increased risk of irreparable harm they faced. McCoy, 481 S.E.2d 
at 778–79. In contrast, this Court must determine the viability of 
the Plaintiffs' claims under both substantive and procedural law 
and address the corporate defendants' challenges to the merits of 
the complaint. 
 B. Timeliness of Counts 1, 3, 4, and 5 
 The corporate defendants challenge the timeliness of the 
Plaintiffs' claims for illegal mortgage (Count 1), 
unconscionability (Count 3), fraud (Count 4), and to quiet title 
(Count 5) (Dkt. No. 7 at 4-7). While they initially asserted that 
these claims were barred by the relevant statutes of limitation, 
they now agree with the Plaintiffs that, because each has been 
styled as a contract defense seeking equitable relief, the doctrine 
of laches applies (Dkt. Nos. 10 at 13; 14 at 4). As discussed 
earlier, for the Plaintiffs' claims to be barred by laches the 
corporate defendants must establish (1) that the Plaintiffs lacked 
diligence in bringing their claims, and (2) that they have 
detrimentally changed their position based on this delay. See Dunn, 
689 S.E.2d at 267. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 i. Delay 
 The corporate defendants assert unreasonable delay because it 
has been fourteen (14) years since the Plaintiffs became aware or 
should have become aware of the terms of their loan and any 
defenses to that contract (Dkt. No. 14 at 4-5). The Plaintiffs 
contend their delay was not unreasonable because they brought their 
claims in response to the corporate defendants' attempt to 
foreclose on their home (Dkt. No. 10 at 16–18). 
 Although the Plaintiffs clearly have delayed in asserting 
their rights, such delay is not so unreasonable as to bar their 
claims. In West Virginia, foreclosures sales by trustees may occur 
without judicial interference because such non-judicial 
foreclosures are "more time efficient and economical." Lucas v. 
Fairbanks Cap. Corp., 618 S.E.2d 488, 490 (W. Va. 2d005). To halt 
a non-judicial foreclosure sale, homeowners must file suit 
requesting equitable relief. Chandler v. Greenlight Fin. Servs., 
No. 2:20-CV-00217, 2021 WL 1202078, at *10 (S.D.W. Va. Mar. 30, 
2021) (citing Lucas, 618 S.E.2d at 490). Here, the Plaintiffs 
attempted to halt the sale of their property by utilizing the only 
means available to them under law – filing suit and asserting 
equitable defenses to their mortgage contract. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 Moreover, even though the Plaintiffs have made various 
attempts to avoid foreclosure by non-legal means, Shellpoint 
allegedly thwarted their every effort. For example, at 
Shellpoint's instruction, the Plaintiffs submitted three loan 
modification applications between July 2017 and February 2019 
(Dkt. No. 5 at 8-10). They allege that Shellpoint denied their 
first two applications for specious reasons, and when it finally 
denied their third application in February 2019 stated only that 
the Plaintiffs "[had] not [met] the requirements to qualify" for 
a modification. Id. Moreover, while their loan modification 
applications were pending, the Plaintiffs offered to make lump sum 
payments to bring their loan current, but Shellpoint refused these 
payments and would not inform them of the total amount due on their 
loan. Id. at 11. 
 The Plaintiffs further allege that, in September 2019, 
Shellpoint filed suit to clear the liens on the Plaintiffs' 
property without properly obtaining service of process on them. 
Id. at 12. After they learned about the lawsuit from the Parenti 
family, the Plaintiffs contacted Shellpoint, who "falsely advised 
[them] that they did not need to worry about or respond to the 
lawsuit." Id. Following this, Shellpoint misrepresented the status 
of the Parenti family loan to the state court in order to obtain 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
a default judgment against the Plaintiffs. Id. at 12-13. 
Thereafter, the Plaintiffs sent a request for information, notice 
of error, and notice of opportunity to cure to Shellpoint, and 
brought suit only after Shellpoint scheduled the sale of their 
property. Id. at 13. 
 Although fourteen (14) years have passed since the closing of 
the Plaintiffs' loan, under the facts pleaded in their complaint 
they have not unreasonably delayed asserting their breach of 
contract defenses. As permitted under West Virginia law, they 
brought an injunction action to halt foreclosure of their property 
after long seeking to avoid foreclosure by non-litigation means. 
 ii. Prejudice 
 Nor can the corporate defendants establish the requisite 
prejudice resulting from any delay by the Plaintiffs. The West 
Virginia Supreme Court of Appeals "has consistently emphasized the 
necessity of a showing that there has been a detrimental change of 
position in order to prove laches." Dunn, 689 S.E.2d at 267 
(citations omitted). According to the Plaintiffs, the corporate 
defendants not only have not been prejudiced by any delay but 
rather have benefitted because they have continued to collect their 
loan payments (Dkt. No. 10 at 16–18). The corporate defendants 
counter that the law presumes prejudice because the analogous 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
statutes of limitation for the Plaintiffs' claims have expired 
(Dkt. No. 14 at 4-5). 
 Under the circumstances of this case, the Court declines to 
apply the presumption of prejudice to these claims. In contrast to 
defendant David, who had undertaken no action concerning the 
consolidated loan since 2007, Shellpoint has actively serviced the 
Plaintiffs' loan since 2017, US Bank Trust has held the loan since 
at least 2021, and both sought to foreclose on the loan. 
 Furthermore, the corporate defendants have not suffered a 
detrimental change of position based on the Plaintiffs' delay. 
During oral argument, they could point only to the passage of time 
as evidence of prejudice, but such delay alone does not bar 
equitable relief under the doctrine of laches. See Syl. Pt. 1, 
State ex rel. Smith v. Abbot, 418 S.E.2d 575, 576 (W. Va. 1992). 
Therefore, because they have failed to clearly demonstrate any 
detrimental change in their positions, the corporate defendants 
cannot establish that the Plaintiffs claims in Counts 1, 3, 4, and 
5 are barred by the doctrine of laches. 
 C. Count 2: Unauthorized Practice of Law 
 The corporate defendants next assert that Count 2 should be 
dismissed against them because it relates only to David (Dkt. No. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
7 at 7). The Plaintiffs agree. In light of its earlier ruling 
dismissing David, the Court will dismiss Count 2 in its entirety. 
 D. Count 6: Joint Venture and Agency 
 The corporate defendants also contend that the Plaintiffs 
have failed to state any facts in support of the claims asserted 
in Count 6 (Dkt. No. 7 at 7-8). The title of Count 6, "joint 
venture and agency," indicates the Plaintiffs' intent to assert 
these two independent theories of liability in a single count. 
Compare Armor, 535 S.E.2d at 742 (defining "joint venture" under 
West Virginia law), with General Elec. Credit Corp. v. Fields, 133 
S.E.2d 780, 783 (W. Va. 1963) (setting forth the determinative 
characteristics of a principal-agent relationship). Their 
pleading, however, primarily addresses the existence of a joint 
venture between Shellpoint and US Bank Trust and makes only passing 
reference to the existence of an agency relationship between them. 
See Dkt. No. 5 at 17-18. Based on this pleading, as well as the 
parties' briefing and oral argument, the Court construes Count 6 
to assert only a claim for joint venture and will address the 
corporate defendants' arguments seeking dismissal of Plaintiffs' 
agency claim in connection with its consideration of Counts 7, 8, 
9, 10, and 12. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 Whether the Plaintiffs have plausibly pleaded the existence 
of a joint venture between Shellpoint and US Bank Trust related to 
the consolidated loan origination or closing in June 2007 depends 
on whether their complaint contains any factual allegations beyond 
the mere recitation that they formed a "single business enterprise" 
to "clos[e] . . . the sale and financ[e] . . . the home at issue 
in this case" (Dkt. No. 5 at 17). Because Shellpoint did not begin 
servicing the loan until 2017, and the deed of trust was not 
assigned to US Bank Trust until 2021, the corporate defendants 
clearly could not have been involved in any joint venture in 2007. 
 The Plaintiffs assert that 
 [d]efendants US Bank and Shellpoint have one or more 
 agreements to engage in the business enterprise of 
 collecting on the subject account; said Defendants 
 shared in the profits of this enterprise; said 
 Defendants each used its purported skill and knowledge 
 to carry out the enterprise (that is, the ownership and 
 servicing of the loan); and that the actions were done 
 with a joint purpose to further then enterprise of 
 generating profits from collection on the subject 
 mortgage (and others contained in the same pool). 

(Dkt. No. 10 at 20). But in a footnote to their briefing, they 
concede that their "pleading could have been clearer on this 
issue." Id. at n.6. They further assert that "[d]iscovery will 
demonstrate that Defendant US Bank expected Defendant Shellpoint 
to follow its loan serving guidelines and other requirements set 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
forth in a servicing agreement, and in some circumstances, 
delegated authority to it to engage in servicing practices to 
maximize return on the investment in the loan pool." Id. at 20. 
Even so, the Plaintiffs' complaint is devoid of sufficient facts 
to support the existence of a joint venture between Shellpoint and 
US Bank Trust in 2007. 
 E. Counts 7, 8, 9, 10, and 12 against US Bank Trust 
 In its motion to dismiss the remaining claims related to 
illegal loan servicing, US Bank Trust argues that the Plaintiffs 
have failed to allege that it engaged in any wrongdoing in this 
regard (Dkt. No. 7 at 8-9). The Plaintiffs acknowledge they did 
not plead that US Bank took any action constituting illegal loan 
servicing, but they argue they have sufficiently pleaded an agency 
relationship between US Bank Trust as the principal and Shellpoint 
as its servicing agent, and that discovery will disclose a 
servicing agreement between the corporate defendants granting 
Shellpoint the authority to act for, and under the instruction of, 
US Bank Trust (Dkt. No. 10 at 21-23). They also contend that, 
because they have challenged US Bank's authority to collect on the 
loan for lack of chain of title, issues of fact exist that must be 
developed in discovery. Id. at 22. 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 Under West Virginia law, a principal may be held liable for 
the acts of its agent. Syl. Pt. 3, Jarvis v. Modern Woodmen of 
Am., 406 S.E. 2d 736 (W. Va. 1991). Four general factors determine 
whether a master-servant relationship exists under the doctrine of 
respondeat superior: "(1) Selection and engagement of the servant; 
(2) Payment of compensation; (3) Power of dismissal; and (4) Power 
of control. Finally, "[p]roof of an express contract of agency is 
not essential to the establishment of the relation. It may be 
inferred from the facts and circumstances, including conduct." 
Fields, 133 S.E.2d at 783. 
 In their complaint, the Plaintiffs have alleged that the 
corporate defendants were agents of and acted under the control of 
each other, and that "Shellpoint claims to be the servicer" of the 
Plaintiffs' loan and that US Bank Trust "purports to be the holder" 
of their loan. In Warden v. PHH Mortgage Corporation, a similar 
allegation was found sufficient to plausibly plead an agency 
relationship between a loan servicer and a mortgage holder. 2010 
WL 3720128, at *4 (N.D.W. Va. Sept. 16, 2010). "In the instant 
case, the plaintiffs allege that PHH serviced a loan held by Fannie 
Mae, and did so as an agent. Accepting these allegations as true, 
the Court finds that PHH could have plausibly acted as Fannie Mae's 
agent. Whether Fannie Mae had some degree of control over the 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
conduct and activities of PHH is a question to be answered in 
discovery. At this stage, however, the plaintiffs have 
sufficiently pled the existence of agency." Id. 
 As in Warden, the Plaintiffs here have plausibly pleaded an 
agency relationship between US Bank Trust and Shellpoint based on 
the nature of their relationship as loan holder and loan servicer, 
respectively. Warden, at *4 ("By its very nature, a servicer acts 
as the agent of a loan holder by collecting payments due under the 
loan and providing other services upon the default of the 
borrower."). 
 IV. Conclusion 
 For the reasons discussed, the Court: 
 1. DISMISSES all claims against defendant David with 
 prejudice; 
 2. DENIES the Plaintiffs' motion to remand; 
 3. DENIES the corporate defendants' motion to dismiss 
 Counts 1, 3, 4, and 5; 
 4. GRANTS the corporate defendants' motion to dismiss Count 
 2 with prejudice; 
 5. GRANTS the corporate defendants' motion to dismiss Count 
 6 without prejudice; and 
 MEMORANDUM OPINION AND ORDER DENYING THE PLAINTIFFS' 
MOTION TO REMAND [DKT. NO. 9], DISMISSING CLAIMS AGAINST 
DEFENDANT DAVID, AND GRANTING-IN-PART AND DENYING-IN-PART 
THE CORPORATE DEFENDANTS' MOTION TO DISMISS [DKT. NO. 6] 
 6. DENIES US Bank Trust's motion to dismiss Counts 7, 8, 9, 
 10, and 12. 
 It is so ORDERED. 
 The Clerk SHALL transmit copies of this Order to counsel of 
record by electronic means. 
DATED: January 25, 2022 
 /s/ Irene M. Keeley 
 IRENE M. KEELEY 
 UNITED STATES DISTRICT JUDGE