The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge:
MEMORANDUM OPINION AND ORDER
Before the Court is Defendant Stewart Title Company's motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. (R. 13.) For the reasons set forth below, the Court grants in part, and denies in part, Defendant's motion to dismiss.
Plaintiff Kondaur Capital Corporation is a Delaware-based licensed
mortgage purchaser and service provider, with its principal place of
business in California. (R. 1, Not. of Rem., Ex. A, Compl. ¶ 1.)
Defendant Stewart Title Company is a Texas-based title insurance
company with its principal place of business in Texas.*fn1
(Id. ¶¶ 5-6.) Plaintiff pleads the following facts in the
In April of 2005, MidAmerica Bank, FSB ("MidAmerica") "made a loan" to Luis and Maria Dominguez (the "Dominguez Loan"), which "was to be secured by a first mortgage" on their residence located at 7546 West Gunnison, Harwood Heights, Illinois (the "Property"). (Compl. ¶ 4.) The loan "closed" on April 21, 2005, and MidAmerica "disbursed the loan proceeds." (Id. ¶ 5.) Defendant "was the closing agent responsible for closing the Dominguez [L]oan," and received "remuneration for such services" out of the loan proceeds. (Id. ¶ 6.) "In connection with the Dominguez Loan, title insurance was purchased" from Defendant. (Id. ¶ 7.)
Prior to the April 21, 2005 closing date, "MidAmerica delivered to [Defendant] a document entitled 'Agency Closing Transmittal,'" or "Closing Instructions." (Id. ¶ 8 & Ex. 1.) This document "required" Defendant to "insure, inter alia, that MidAmerica was in a first lien position prior to closing." (Id.) On or about the closing date, Defendant "issued to MidAmerica a 'First Lien Letter' insuring that MidAmerica would have a first lien on the Property.'" (Id. ¶ 9 & Ex. 2.) "The First Lien Letter was issued pursuant to MidAmerica's requirement in the Closing Instructions that it be in a first lien position before the Dominguez Loan could close." (Id.) Additionally, the First Lien Letter "was separately and independently bargained for," and "provided MidAmerica with a guarantee and indemnification coverage insuring that MidAmerica would have a first lien on the Property at the time of the loan closing." (Id. ¶ 9.) Sometime in 2009, PNC Bank, N.A. ("PNC Bank") "became successor in interest" to MidAmerica. (Id. ¶ 11.)
In January of 2009, Vale Foods, Inc. ("Vale Foods") commenced foreclosure proceedings on the Property based on a "mortgage executed by the Dominguezes in favor of Vale Foods in 2003." (Id. ¶ 13.) Sometime in 2011, Plaintiff "purchased the Promissory Note and Mortgage associated with the Dominguez Loan from PNC." (Id. ¶ 12.) Additionally, "it was adjudicated that [Plaintiff] via its purchase of the Dominguez Loan, was in second lien position behind the Vale Foods Prior Mortgage." (Id. ¶ 13.) Plaintiff "demanded that [Defendant] defend [Plaintiff's] interests in the Vale Foods foreclosure action pertaining to the Prior Mortgage," but Defendant "refused." (Id. ¶ 14.) Additionally, Plaintiff "demanded that [Defendant] indemnify it for the loss incurred as a result of the Vale Foods Prior Mortgage being adjudicated to be in the first lien position," but Defendant "refused." (Id. ¶ 15.)
On August 26, 2011, Plaintiff filed a civil action against Defendant in the Circuit Court of Cook County, Illinois. Defendant timely removed the action to this Court pursuant to 28 U.S.C. §§ 1332, 1441, and 1446, on the basis of diversity of citizenship. The Complaint contains seven state law counts, specifically Breach of Defense and Indemnity Obligation Under First Lien Letter (Count I); Statutory Damages for Bad Faith Failure to Pay or Settle, in violation of 215 ILCS 5/155 (Count II); Promissory Estoppel - First Lien Letter (Count III); Fraudulent Misrepresentation - First Lien Letter (Count IV); Breach of Contract - Closing Instructions (Count V); Promissory Estoppel - Closing Instructions (Count VI); and Fraudulent Misrepresentation - Closing Instructions (Count VII).In the present motion, Defendant seeks to dismiss the Complaint in its entirety.
"A motion under Rule 12(b)(6) challenges the sufficiency of the complaint to state a claim upon which relief may be granted." Hallinan v. Fraternal Order of Police of Chicago Lodge No. 7, 570 F.3d 811, 820 (7th Cir. 2009). "The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." AnchorBank, FSB v. Hofer, 649 F.3d 610 (7th Cir. 2011) (internal quotation and citation omitted). Pursuant to Rule 8(a)(2), a complaint must include "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2).
As the Seventh Circuit has explained, this "[r]ule reflects a liberal notice pleading regime, which is intended to 'focus litigation on the merits of a claim' rather than on technicalities[.]" Brooks v. Ross, 578 F.3d 574, 580 (7th Cir. 2009) (quoting Swierkiewicz v. Sorema N.A., 534 U.S. 506, 514, 122 S. Ct. 992, 152 L. Ed. 2d 1 (2002)). The short and plain statement under Rule 8(a)(2) must "give the defendant fair notice of what the claim is and the grounds upon which it rests." Bell Atl. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47, 78 S. Ct. 99, 2 L. Ed. 2d 80 (1957)). Under the federal notice pleading standards, a plaintiff's "factual allegations must be enough to raise a right to relief above the speculative level." Twombly, 550 U.S. at 555. Put differently, a "complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937, 1949, 173 L. Ed. 2d 868 (2009) (quoting Twombly, 550 U.S. at 570).
"[W]hen ruling on a defendant's motion to dismiss, a judge must accept as true all of the factual allegations contained in the complaint." Erickson v. Pardus, 551 U.S. 89, 94, 127 S. Ct. 2197, 167 L. Ed. 2d 1081 (2007); see also Graczyk v. West Pub. Co., 660 F.3d 275, 279 (7th Cir. 2011) (stating in the context of a motion to dismiss, that the court will "construe the complaint in the light most favorable to the plaintiff, accept well-pleaded facts as true, and draw all inferences in the plaintiff's favor").
Before reaching the merits of Defendant's arguments, the Court briefly addresses the scope of its review. The Complaint contains two exhibits, namely the First Lien Letter, and the Closing Instructions. Defendant's motion to dismiss attaches the title insurance policy ("Title Policy"), and a declaration of an employee attesting to the authenticity of the Title Policy. In addition, Plaintiff's response in opposition to Defendant's motion attaches a record relating to MidAmerica's alleged assignment of the mortgage to Plaintiff.
A motion to dismiss under Rule 12(b)(6) challenges the sufficiency of the pleadings, and as such, the Court's "consideration of matters outside the pleadings is not generally permitted," unless the Court converts the motion into one for summary judgment pursuant to Rule 12(d). See McIntyre v. McCaslin, No. 11 C 50119, 2011 WL 6102047, at *4 (N.D. Ill. Dec. 7, 2011) (citing, inter alia, Levenstein v. Salafsky, 164 F.3d 345, 347 (7th Cir. 1998)). One exception to this general rule exists where the parties present records "to which the Complaint [refers]," are "conededly authentic," and are "central" to the claims presented. See Hecker v. Deere & Co., 556 F.3d 575, 582 (7th Cir. 2009).
As applied to this case, the Court will consider the First Lien Letter and the Closing Instructions in evaluating the motion to dismiss. Plaintiff relies extensively on these documents in its Complaint, there is no suggestion that the documents are not authentic, and the documents directly give rise to Plaintiff's causes of action. See Rosenblum v. Travelbyus.com Ltd., 299 F.3d 657, 661-62 (7th Cir. 2002) ("'[D]ocuments attached to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to his claim. Such documents may be considered by a district court in ruling on the motion to dismiss.'") (quoting Wright v. Assoc. Ins. Cos. Inc., 29 F.3d 1244, 1248 (7th Cir. 1994)). The Court will not, however, consider the remaining documents, including the Title Policy, declaration, and record of assignment, none of which are attached to or discussed meaningfully in the Complaint.
Even if the Court considered these documents, however, its disposition of the present ...