United States District Court, D. Minnesota
Valerie LeMaster, plaintiff pro se.
Lewis, STINSON LEONARD STREET LLP, and Katherine E.
Devlaminck, STINSON LEONARD STREET LLP, for defendants Ditech
Financial LLC and Federal National Mortgage Association.
Bernard J. Barrett, Jr. for defendant Consumer Financial
MEMORANDUM OPINION AND ORDER ADOPTING REPORT &
R. TUNHEIM CHIEF JUDGE
Valerie LeMaster brought this action against Ditech Financial
LLC (“Ditech”), the Federal National Mortgage
Association (“Fannie Mae”), and the Consumer
Financial Protection Bureau (“CFPB”). LeMaster
alleges that the Defendants breached a 2015 Consent Order
that resolved an action brought by the Federal Trade
Commission and CFPB against Ditech for various alleged
violations of federal consumer-protection laws. Here, the
CFPB moves to dismiss LeMaster's action for lack of
standing, and Ditech and Fannie Mae move for judgment on the
pleadings. United States Magistrate Judge David T. Schultz
issued a Report and Recommendation (“R&R”),
recommending that the motions be granted. LeMaster objects.
Because the Court will conclude that it lacks subject-matter
jurisdiction over all claims, the Court will grant the
CFPB's motion and dismiss this action without prejudice.
in 2014, Ditech and Fannie Mae were involved in foreclosure-
and eviction-related litigation against LeMaster in Minnesota
state court. Although LeMaster was permitted to remain in her
home during those proceedings, Ditech and Fannie Mae have
prevailed, and LeMaster has exhausted her appeals.
in April 2015, while LeMaster's action challenging the
foreclosure was still pending, [the] CFPB, FTC and Ditech
signed a Consent Order in which Ditech agreed, among other
things, to pay $48 million to CFPB to create a consumer
redress fund.” (R&R at 3, June 29, 2018, Docket No.
67.) “The Consent Order was not related to
LeMaster's lawsuit, and she is not a party to the Consent
action in federal court, LeMaster alleges “that she is
‘a third-party beneficiary under the terms of the
Consent Order' and therefore is entitled to relief under
that agreement.” (Id. at 4 (quoting Compl.
¶ 11, Nov. 14, 2017, Docket No. 1).) She asserts, among
other things, that Ditech and the CFPB breached the Consent
Order with respect to her, and that Fannie Mae is liable to
her for setting an unconscionable repurchase price for her
home. (Id.) LeMaster asserts claims for relief
pursuant to the Consent Order, for which the Court has
original federal-question jurisdiction pursuant to 28 U.S.C.
§ 1331. (Compl. ¶ 6.) LeMaster asserts various
state-law claims for which the Court has supplemental
jurisdiction pursuant to 28 U.S.C. § 1367. (Id.
CFPB moves to dismiss this action for lack of standing,
arguing that LeMaster cannot enforce the Consent Order
because she was neither a party to the Consent Order nor a
person intended to have the ability or authority to enforce
it. Ditech and Fannie Mae move for judgment on the pleadings,
arguing that this action is barred under several theories.
The Magistrate Judge recommended that LeMaster's
federal-question claims be dismissed for lack of standing and
that the Court decline to exercise supplemental jurisdiction
over LeMaster's remaining state-law claims. (R&R at
11.) LeMaster objects. (Pl.'s Obj., July 12, 2018, Docket
STANDARD OF REVIEW
the filing of an R&R by a magistrate judge, “a
party may serve and file specific written objections to the
proposed findings and recommendations.” Fed.R.Civ.P.
72(b)(2); accord D. Minn. LR 72.2(b)(1). “The
district judge must determine de novo any part of the
magistrate judge's disposition that has been properly
objected to.” Fed.R.Civ.P. 72(b)(3); accord D.
Minn. LR 72.2(b)(3).