RICHMOND, Va. – A West Virginia woman who alleged numerous counts against Wells Fargo Mortgage and several other participants in her mortgage loan refinancing and subsequent foreclosure action found no relief at the U.S. Court of Appeals for the Fourth Circuit.

A three-judge panel consisting of Judges Dennis W. Shedd, Allyson K. Duncan and Albert Diaz issued a per curiam opinion on July 31 affirming a decision by U.S. District Judge John Preston Bailey, of the Northern District of West Virginia.

Diana Wittenberg closed on a mortgage loan with First Independent Mortgage Company on March 27, 2006, after starting and stopping the process several times after beginning the application process in 2005. Wittenberg would later allege that her income had been misstated on her application, despite her protestations, among a host of other issues she raised with the process.

Wells Fargo Bank N.A. was the servicer of Wittenberg’s loan and it began to send her letters regarding the adding of tax and insurance escrows to her monthly payment about a year after the loan was closed. According to Wittenberg, the original loan terms did not require an escrow for taxes and insurance but she was unable to work the issue out with Wells Fargo.

In December of 2008, the opinion says, Wittenberg and a Wells Fargo specialist reached an agreement regarding the escrow dispute and the bank offered Wittenberg a modification that would have provided that payments that had been missed during the dispute be repaid over the life of the loan. Wittenberg declined the modification because her monthly payment would have increased.

Following much wrangling between the parties, Seneca Trustee, Inc. was appointed to schedule a foreclosure sale on the property. Seneca notified Wittenberg of impending sales on more than one occasion and it offered her the opportunity to reinstate the loan by paying a certain amount prior to the sale. None of the sales materialized.

On June 8, 2010, Wittenberg filed suit against First Independent, Wells Fargo, Seneca, and several other parties affiliated with the loan and the foreclosure proceedings. She alleged failure to exercise reasonable care in issuing her a loan and failing to preserve her original note and loan documents; breach of fiduciary duty; fraud; fraudulent, deceptive, or misleading representations in violation of the West Virginia Consumer Credit and Protection Act; violation of the Fair Debt Collection Practices Act; and civil conspiracy.

By Feb. 10, 2012, all of the claims had been dismissed or the defendants had been granted summary judgment. On March 12, 2012, Wittenberg filed a notice of appeal.

Many of Wittenberg’s claims relied on her allegation that there were two different notes and that the “March 21 Note” was different from the “March 27 Note.” On this issue, the Fourth Circuit wrote:

"The district court correctly surmised that Wittenberg’s claims based on the alleged difference between the two notes are little more than 'naked assertions devoid of further factual enhancements.' Moreover, even after the court provided Wittenberg with a second opportunity - in the form of additional briefing - to explain how she was injured by the preservation and use of the allegedly incorrect note, she failed to do so. Even now, on appeal, Wittenberg fails to detail what terms differed between the March 21 and March 27 notes."

Wittenberg also argued that the district court had erred in dismissing her WVCCPA claim against Wells Fargo, which she had alleged on grounds that letters written by Wells Fargo, or on its behalf, were fraudulent, deceptive, or misleading.

“Wittenberg failed to allege,” the court wrote, “that her loan was not delinquent. We agree with the district court that ‘if, according to her own allegations, [Wittenberg] was delinquent, then the foreclosure notices could not have been fraudulent, deceptive, or misleading as a matter of law.’”

On fiduciary duty and fraud claims which Seneca defeated on summary judgment, the court wrote, “Wittenberg defaulted on her loan, and the Deed of Trust provides for the invocation of the power of sale. Wells Fargo alerted Seneca of the default, and Seneca simply scheduled a foreclosure sale as demanded. Under these facts, which Wittenberg does not dispute, the district court correctly held that she could not prevail against Seneca in an action for breach of fiduciary duty.

“As for fraud, Wittenberg argued below that Seneca defrauded her by misrepresenting that it had the authority to foreclose on her property. However, as Seneca has not actually foreclosed on her property, the district court correctly determined that Wittenberg had failed to present a genuine issue of material fact as to whether the alleged misrepresentations caused her damages sufficient for a finding of fraud."

Other claims were handled similarly by the appeals court, including her appeal of the denial of her motion for relief from judgment.

“Wittenberg’s motion was based upon an opinion issued by another court on February 9, 2012 - the day before the district court entered its final order in this case. She presents no compelling explanation for why it took her more than nine months from the issuance of that opinion to file her motion. We therefore hold that the district court did not abuse its discretion in denying her motion for relief from judgment.”

Wittenberg was represented by Michael M. Brownlee of Brownstone, P.A., in Winter Park, Fla.

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