United States District Court, D. South Carolina, Anderson/Greenwood Division
James N. Hough, Gena G. Hough, Whitfield Farms, LLC, Plaintiffs,
Ag South Farm Credit ACA, Defendant.
OPINION AND ORDER
C. Coggins, Jr. United States District Judge.
matter is before the Court on Defendant's Motions to
Exclude Untimely Disclosures of Plaintiff's Experts and
to Dismiss. ECF Nos. 45, 46. Plaintiffs filed Responses in
Opposition to both Motions, and Defendant has filed Replies.
ECF Nos. 48, 50, 52, 53. Accordingly, the Motions are ripe
action was originally filed in the United States District
Court for the Middle District of Florida on October 31, 2016.
ECF No. 1. On November 21, 2016, Defendant filed a Motion to
Dismiss, or in the Alternative, to Transfer Venue to the
District Court of South Carolina. ECF No. 7. Plaintiffs filed
a Response in Opposition, and on December 9, 2016, this case
was transferred to this District pursuant to an Order by the
Honorable James S. Moody, Jr., United States District Judge
for the Middle District of Florida. ECF Nos. 12, 13.
matter is before this Court on the basis of diversity
jurisdiction. ECF No. 1. The Complaint raises state law
claims, including causes of action for forgery, bank fraud,
fraudulent misrepresentation, mail and wire fraud, wrongful
foreclosure, and intentional infliction of emotional
distress. Id. The facts of this case stem from the
execution of a fixed rate note and the subsequent foreclosure
action that was decided in the Court of Common Pleas in
Edgefield County, South Carolina (“the State
foreclosure action”). See id.; see also
AgSouth Farm Credit, ACA v. Whitfield Farms, LLC, Fifth Third
Bank, NA, and Signature Bank, n/k/a Hancock Bank, No.
2015-CP-19-361 (S.C. Ct. Com. Pleas 2015).
contend that James and Gena Hough (“the Individual
Plaintiffs”) were managing partners and owners of
Whitfield Farms, LLC, (“Whitfield Farms”). On
June 6, 2003, the individual Plaintiffs took out a Fixed Rate
Note (“the Note”) with Defendant, a lending
cooperative and/or credit union specializing in agricultural
land. ECF No. 1 at 3. On March 20, 2010, the Note was
satisfied. James Hough received notice on January 5, 2014,
from Defendant requiring the Individual Plaintiffs to apply
to refinance the remainder of their loan for $400, 000 dated
February 24, 2012, (“the 2012 Note”) or face
foreclosure. Id. Plaintiffs contend that they did
not authorize and have never seen the 2012 Note and have
never been to Bamberg, South Carolina where the 2012 Note was
filed a complaint for foreclosure of the 2012 Note in the
Court of Common Pleas in Edgefield County, South Carolina
against only Whitfield Farms. Whitfield Farms filed an answer
alleging multiple deficiencies in the 2012 Note. The answer
and counterclaims were struck because Whitfield Farms, as a
corporation, was prohibited from proceeding pro se in that
action. On September 28, 2009, a supplemental order of
judgment for foreclosure and sale was issued. Whitfield Farms
did not appeal this order.
12(b)(6) of the Federal Rules of Civil Procedure permits the
dismissal of an action if the complaint fails “to state
a claim upon which relief can be granted.” Such a
motion tests the legal sufficiency of the complaint and
“does not resolve contests surrounding the facts, the
merits of the claim, or the applicability of defenses . . . .
Our inquiry then is limited to whether the allegations
constitute a short and plain statement of the claim showing
that the pleader is entitled to relief.” Republican
Party of N.C. v. Martin, 980 F.2d 943, 952 (4th Cir.
1992) (internal quotation marks and citation omitted). In a
Rule 12(b)(6) motion, the court is obligated to “assume
the truth of all facts alleged in the complaint and the
existence of any fact that can be proved, consistent with the
complaint's allegations.” E. Shore Mkts., Inc.
v. J.D. Assocs. Ltd. P'ship, 213 F.3d 175, 180 (4th
Cir. 2000). However, while the Court must accept the facts in
a light most favorable to the nonmoving party, it “need
not accept as true unwarranted inferences, unreasonable
conclusions, or arguments.” Id.
survive a motion to dismiss, the complaint must state
“enough facts to state a claim to relief that is
plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570(2007). Although the
requirement of plausibility does not impose a probability
requirement at this stage, the complaint must show more than
a “sheer possibility that a defendant has acted
unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009). A complaint has “facial plausibility”
where the pleading “allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.” Id.
argues that this action should be dismissed because the
claims raised in this action were compulsory counterclaims in
the prior state action. ECF No. 46-1 at 2. Defendant contends
that Plaintiffs are barred from challenging the 2012
Note's validity under the doctrines of res judicata and
collateral estoppel. Id. Defendant further argues
that the Individual Plaintiffs lack standing to bring any
individual claims. Id. Plaintiffs do not appear to
contest that any claim by Whitfield Farms is barred. ECF No.
50. However, the Individual Plaintiffs assert that they have
standing in the present action and that their interests were
not represented in the prior state action. Id. at 4.