Mashrique v. JPMorgan Chase Bank, N.A.

Background

Najia Mashrique received a home loan in 2007 to purchase real property. She made timely payments for a period and defaulted in July 2019. In October 2019, JPMorgan Chase Bank, N.A. assigned the loan to Select Portfolio Servicing, Inc. (SPS), which became the loan servicer identified in the opinion.

Mashrique had previously sued Chase and SPS over the loan, including allegations involving increased monthly payments, reporting of late mortgage payments, and SPS’s refusal to accept lower payments. She voluntarily dismissed that lawsuit in exchange for a loan modification. The dismissal was with prejudice.

In the current case, Mashrique filed a second amended complaint asserting claims under the Truth in Lending Act, the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, the Coronavirus Aid, Relief, and Economic Security Act, and the Real Estate Settlement Procedures Act. She represented herself. SPS moved to dismiss, and Chase moved to strike and dismiss.

Claim preclusion

The court applied California law on claim preclusion, a rule that generally prevents a party from bringing a later case based on the same cause of action that was or could have been litigated earlier. The court explained that California focuses on the harm and the alleged wrong, rather than simply on the legal theory or statute cited.

The court concluded that Mashrique’s Truth in Lending Act and Real Estate Settlement Procedures Act claims involved the same harms as her earlier lawsuit, including harms related to efforts to foreclose on the property and reporting missed payments. The court reached the same conclusion regarding her Fair Debt Collection Practices Act and Fair Credit Reporting Act claims against Chase. It also treated her argument concerning SPS’s chain of title and possession of the original loan documents as involving the same harms, to the extent that argument asserted a separate claim.

The court found the prior dismissal with prejudice to be a final judgment on the merits and found that the current and prior actions involved the same parties. It therefore held that Chase had shown all of Mashrique’s claims against it were barred by claim preclusion. It also held that SPS had shown that the Truth in Lending Act and Real Estate Settlement Procedures Act claims against SPS, as well as the chain-of-title argument to the extent it was a separate claim, were barred.

CARES Act claim

The court separately addressed Mashrique’s allegation that a 2022 repayment plan offered by SPS violated the CARES Act. The court held that the CARES Act did not provide a private right of action—that is, it did not authorize a private person to sue under the statute. The court therefore dismissed the CARES Act claim.

Leave to amend and disposition

Mashrique requested permission to amend again. The court denied that request because the CARES Act claim could not be pursued without a private right of action, and the proposed new theories did not identify new facts showing that SPS’s conduct was wrongful. The court also held that claims based on the 2007 loan and 2019 default were barred by claim preclusion and could not be cured through amendment.

The court granted Defendants’ separate motions to dismiss with prejudice and without leave to amend. It dismissed Chase’s motion to strike as moot and stated that a separate judgment would issue.