Cox v. NEWREZ LLC D/B/A SHELLPOINT MORTGAGE SERVICING et

UNITED STATES BANKRUPTCY COURT
WESTERN DISTRICT OF KENTUCKY
LOUISVILLE DIVISION
In re:
VALENCIA COX,
Debtor.
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CASE NO. 25-32857
CHAPTER 13
VALENCIA COX,
Plaintiff,
vs.
NEWREZ LLC D/B/A SHELLPOINT
MORTGAGE SERVICING and
THE BANK OF NEW YORK MELLON
TRUST COMPANY, N.A.,
Defendants.
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AP NO. 26-3035
MEMORANDUM OPINION
This matter comes before the Court on the Motion to Dismiss (Dkt.1 No. 10) (the “Motion”)
filed by Defendants, NewRez LLC d/b/a Shellpoint Mortgage Servicing (“NewRez”) and the Bank
of New York Mellon Trust company, N.A., not in its individual capacity but solely as Certificate
Trustee on behalf of NRZ Pass-Through Trust EBO I (the “Bank”) (hereinafter collectively
“Defendants”). In the Motion, Defendants seek dismissal of this adversary proceeding on the basis
that Plaintiff’s claims are arguments that were previously raised and rejected in a state court
foreclosure action and subsequent appeals. The Defendants assert that (i) this Court lacks subject
matter jurisdiction because of the Rooker-Feldman doctrine and (ii) the complaint fails to state a
cause of action because it is either barred by res judicata/collateral estoppel or that the plaintiff is
unable to state a claim. Pro se Plaintiff opposes the Motion (Dkt. No. 17) (“Response”). This Court
1 	Docket entries in this adversary proceeding are referred to as “Dkt. No. ___.” Docket entries in the corollary
main case at Case No. 25-32857 (“Main Case”) are designated as “Main Case Dkt. No. ___.”
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has been asked to decide whether under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6),
as incorporated by Federal Rule of Bankruptcy Procedure 7012(b), this adversary proceeding
should be dismissed for failure to state a claim upon which relief can be granted. For the reasons
stated herein, the Court is contemporaneously entering an order granting in part and denying in
part Defendants’ Motion to Dismiss. To frame the consideration of these matters, the Court will
provide a brief recitation of the factual history between these parties. These facts are not in dispute.
Factual Background
The Court takes judicial notice of the following state court proceedings and of the
proceedings in the Main Case as permitted by Federal Rule of Evidence 201.
A. 	State Court Foreclosure Proceedings and the Main Bankruptcy Case
Plaintiff executed a 30-year promissory note on September 25, 2019, in favor of Mortgage
Research Center, LLC d/b/a Veterans United Home Loans in the amount of $444,352.00 (the
“Note”). Using the funds from the loan, Plaintiff purchased real property at 156 Washington
Commons Drive, Mount Washington, Kentucky. Plaintiff executed a mortgage in favor of
Mortgage Electronic Registration Systems, Inc. as nominee for Mortgage Research Center, LLC,
securing the Note with the real property (the “Mortgage”).
On May 28, 2021, Plaintiff executed a Loan Modification Agreement, which lowered the
interest rate and postponed the maturity date. Plaintiff defaulted on the Note on August 1, 2021.
Plaintiff also defaulted on her homeowners’ association obligations owed to River Crest Home
Owners Association, Inc. (“River Crest”). As a result, River Crest filed a civil action against
Plaintiff in the Commonwealth of Kentucky, Bullitt Circuit Court.2
2 	River Crest is not a party to this adversary proceeding. It filed a proof of claim in the Main Case, to which
the Plaintiff objected. The Court subsequently entered an order allowing River Crest’s claim in a reduced amount.
(Order, Main Case Dkt. No. 122.)
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Thereafter, the Bank joined River Crest’s state court proceeding as a cross-claimant seeking
to foreclose the Note and Mortgage. The matter proceeded in Bullitt Circuit Court, culminating in
a March 22, 2024 judgment granting the Bank’s motion for summary judgment and order of sale.
(J. and Order of Sale, Filed as Ex. A to the Mot. to Dismiss at Dkt. No. 10-2.) The state court found
that Plaintiff defaulted on the Note and directed the Bullitt County master commissioner to sell the
property and distribute the proceeds.
Thereafter, a foreclosure sale was scheduled. Prior to that sale being conducted, the
Plaintiff filed a Chapter 7 bankruptcy case in the United States Bankruptcy Court for the Western
District of Kentucky on April 11, 2024, Case No. 24-30967. The 2024 Chapter 7 bankruptcy was
dismissed on April 26, 2024 for failure to complete filing requirements. (Not. of Dismissal, In re:
Valencia Cox, No. 24-30967 (Bankr. W.D. Ky. Apr. 26, 2024), Dkt. No. 14.)
Meanwhile, the Plaintiff appealed the Bullitt Circuit Court judgment to the Kentucky Court
of Appeals. In the appeal, Plaintiff argued that the Bullitt Circuit Court erred in its entry of
summary judgment in favor of the Bank and of the order of sale. She disputed the validity of the
foreclosure action on multiple grounds. Plaintiff argued that the Bank “lacked standing to foreclose
the note and mortgage; that she was improperly denied the right to examine the original note; and,
that [the Bank] engaged in fraud.” Cox v. Bank of New York Mellon Tr. Co., No. 2024-CA-0689-
MR, 2025 WL 1141847, at *1 (Ky. Ct. App. Apr. 18, 2025). Plaintiff also asserted that the Bank
“failed to produce the original promissory note, which is a necessary prerequisite to a foreclosure
proceeding per the Uniform Commercial Code.” Id. at *2.
On April 18, 2025, the Kentucky Court of Appeals affirmed the judgment entered by the
Bullitt Circuit Court. With respect to Plaintiff’s arguments, the Court of Appeals found no manifest
injustice warranting reversal of the judgment on appeal. Id. Specifically:
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Appellant’s claim that Appellee cannot lawfully proceed with the
foreclosure without establishing a valid agency relationship with its
attorney is specious and not supported by the law. We are also not
persuaded by Appellant’s contention that Appellee has no standing
in this matter because it was not an original party to the note and
mortgage agreements. This argument is refuted by the record, as the
note is endorsed by Mortgage Research Center, LLC and Appellee
is the holder of the note. See KRS 355.3-301.
Further, we find nothing in the record to support Appellant’s claim
that Appellee acted fraudulently, nor that the proceeding below
deprived Appellant of her due process rights or statutory rights under
the Fair Debt Collection Practices Act. Appellant has simply made a
litany of unpreserved claims without citation to the record, and
unsupported by adequate reference to the case law or statutory law.
Id. at *3. Accordingly, “[t]he record and the law support the entry of summary judgment in favor
of [the Bank].” Id. at *4.
The Plaintiff then requested discretionary review of the Kentucky Court of Appeals’
decision by the Kentucky Supreme Court. On August 22, 2025, the Kentucky Supreme Court
declined to exercise discretionary review of the matter, thereby making the judgment from the
Bullitt Circuit Court final.
A new foreclosure sale was scheduled for November 25, 2025. Again, prior to that
foreclosure sale being conducted, Plaintiff filed the current bankruptcy case, Case No. 25-32857,
on November 21, 2025.
In the current bankruptcy case, NewRez filed an untimely proof of claim (Claim No. 7)
based on the amounts due under the Loan and Mortgage. While untimely, the proof of claim was
signed under penalty of perjury and attached a series of documents including the original Note and
Mortgage along with a series of assignments of the Mortgage. The documents included a recorded
assignment of the Mortgage to the Bank dated June 29, 2022 and a subsequent assignment from
the Bank to NewRez dated May 9, 2025 (after the entry of the Bullitt Circuit Court judgment and
Opinion Affirming from the Kentucky Court of Appeals).
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Due to the untimeliness of NewRez’s proof of claim, the Debtor objected to the claim (Main
Case Dkt. No. 35). In response to the Debtor’s objection, NewRez filed a Motion to Allow Late
Filed Proof of Claim (Main Case Dkt. No. 91). Because NewRez failed to meet the requirements
of Federal Rule of Bankruptcy Procedure 3002(c)(7), the Court denied NewRez’s motion. (Order,
Main Case Dkt. No. 132.) Without a timely-filed proof of claim, the Court sustained the Debtor’s
objection and disallowed NewRez’s claim. (Order, Main Case Dkt. No. 134.) Neither the order
denying the Motion to Allow Late Filed Proof of Claim nor the order sustaining the Debtor’s
objection to claim avoided or otherwise extinguished NewRez’s lien upon the Property.
On April 13, 2026, NewRez filed a Motion for Relief from Stay (Main Case Dkt. No. 72)
(“Stay Motion”) seeking authority to continue with its foreclosure action in state court. The
Plaintiff opposed the Stay Motion (Main Case Dkt. No. 77).
B. 	This Adversary Proceeding
While the Stay Motion was pending, on May 1, 2026, Plaintiff filed the above-styled
adversary proceeding. In her Complaint, Plaintiff alleges seven separate counts. Count I sought
declaratory relief regarding the Defendants’ status to enforce the Note. Count II sought a
declaration as to the validity of the Defendants’ lien because the record allegedly did not establish
either Defendant could enforce the lien. Count III requested a declaration regarding NewRez’s
authority as servicer of the Loan. Count IV sought an accounting and declaratory relief as to the
amount of the debt. Count V challenged the postpetition fees and expenses. Count VI alleged
violations of the Real Estate Settlement Procedures Act (“RESPA”). Finally, Count VII sought
injunctive relief against the Defendants to prohibit them from going forward with the foreclosure
action.
On June 1, 2026, the Defendants filed the Motion currently before the Court. As stated
above, Defendants seek dismissal of this adversary proceeding on the basis that the claims raised
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are arguments that were previously raised and rejected in a state court foreclosure action and
subsequent appeals. The Defendants assert that this Court lacks subject matter jurisdiction because
of the Rooker-Feldman doctrine, and that the Complaint fails to state a cause of action because it
is either barred by res judicata/collateral estoppel or the plaintiff is unable to state a claim. With
respect to the RESPA claim, the Defendants assert that they sufficiently met the requirements of
RESPA, attaching correspondence that they claim satisfied RESPA’s requirements.
In her Response to the Motion (Dkt. No. 17), Plaintiff stated that she was not asking this
Court to sit as an appellate court over the Bullitt Circuit Court. Nor was she asking this Court to
vacate the Bullitt Circuit Court foreclosure judgment, or to redetermine matters that were actually
and finally decided. To the extent her Complaint requested this relief, she requested leave to amend
to “narrow that wording.”
Subsequently, Defendants filed a Reply (Dkt. No. 18) wherein they argue that amending
the Complaint would not address or cure the points raised in their Motion. Moreover, they contend
that if the Court determines that any claim survives or that amendment is appropriate as to a
particular claim, that any such amendment be limited to claims that do not seek to invalidate,
modify, or otherwise relitigate the Bullitt Circuit Court foreclosure judgment.
The Court held a hearing on the Motion on August 18, 2026. At that hearing, the Plaintiff
appeared, pro se, and counsel for Defendants appeared.
On August 20, 2026, the Court entered an Order granting NewRez’s Stay Motion in the
Main Case. (Order Terminating Stay, Main Case Dkt. No. 166.) The Court found that cause existed
under § 362(d) to terminate the stay. This cause included the fact that the state court litigation was
final, that Plaintiff did not provide for any payment to NewRez in her proposed plan of
reorganization, and most importantly, that Plaintiff had a significant prepetition and postpetition
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arrearage and had failed to make a single postpetition mortgage payment, resulting in a lack of
adequate protection.3
Legal Standard and Analysis
I. 	Jurisdiction
The Court has jurisdiction in this matter by virtue of Section 1334(b) of Title 28 of the
United States Code and the referral to this Court pursuant to Joint Local Rule of Civil Practice for
the United States District Court for the Eastern and Western Districts of Kentucky 83.12(a). This
is a core proceeding under Section 157(b)(2)(C), (K) and (O) of Title 28 of the United States Code.
II. 	Rule 12(b)(6) Dismissal Standards
The Defendants seek dismissal of this action for failure to state a claim upon which relief
can be granted under Federal Rule of Civil Procedure 12(b)(6), made applicable by Federal Rule
of Bankruptcy Procedure 7012(b). To “survive a motion to dismiss, 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, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the
court to draw a reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal,
556 U.S. at 678 (citation omitted). Although a complaint that is challenged by a Rule 12(b)(6)
motion to dismiss does not need detailed facts, a plaintiff is obligated to provide sufficient grounds
for his entitlement to relief. Twombly, 550 U.S. at 555. Recitation of the elements of a cause of
action by making conclusory statements is not sufficient. Iqbal, 556 U.S. at 678; Twombly, 550
U.S. at 555. Rather, the issue is whether the claims are supported by sufficient factual matter to
make them plausible. Iqbal, 556 U.S. at 678; Twombly, 550 U.S. at 555–56.
3 	On September 2, 2026, Plaintiff filed a Notice of Appeal of the order terminating the stay with respect to
NewRez. (Not. of Appeal to B.AP., Main Case Dkt. No. 176.)
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Thus, if the factual allegations are “well-pleaded” in the complaint, a court can assume
their veracity and then decide whether the facts could support the requested relief. Iqbal, 556 U.S.
at 664. This analysis is “context-specific, requiring the reviewing court to draw on its experience
and common sense.” Id. at 663–64. The court’s task, however, is not to determine if a plaintiff will
prevail on the merits, but rather whether a plaintiff is entitled to provide evidence in support of her
claim. Hamerly v. Fifth Third Mortg. Co. (In re J & M Salupo Dev. Co.), 388 B.R. 795, 802 (B.A.P.
6th Cir. 2008); see also In re Bailey, 2024 WL 1511984, at *6 (B.A.P. 6th Cir. Apr. 8, 2024)
(quoting Delker v. MasterCard Int’l, Inc., 21 F.4th 1019, 1024 (8th Cir. 2022)); Think3 Litig. Tr. v.
Zuccarello (In re Think3, Inc.), 529 B.R. 147, 169 (Bankr. W.D. Tex. 2015). In other words, the
court is to assess the legal feasibility of the complaint, not to weigh the evidence. The court can
review and consider the complaint in its entirety, including any documents attached to the
complaint, or incorporated into the complaint by reference, and matters of which a court may take
judicial notice. Think3 Litig. Tr., 529 B.R. at 169–70.
III. 	Analysis
Based on the allegations in the Complaint, taken as true, considered alongside the state
court proceedings, Defendants’ Motion should be granted in part and denied in part. Counts I, II,
and IV of Plaintiff’s Complaint should be dismissed based on issue preclusion.4 Counts III, V, and
VII should be dismissed on other grounds, as discussed below. Finally, as also discussed below,
Count VI, the RESPA Count, requires further attention.
4 	The Sixth Circuit noted in In re Fordu that the United States Supreme Court has expressed a preference for
use of the terms “issue preclusion” and “claim preclusion” rather than the traditional phrases “res judicata” and
“collateral estoppel.” 201 F.3d 693, 702–03 (6th Cir. 1999) (citing Migra v. Warren City Sch. Dist. Bd. of Educ., 465
U.S. 75, 77 n.1 (1984)). This Court will use the term “issue preclusion.”
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A. 	Counts I, II, and IV
First, with respect to Counts I, II, and IV, these allegations were raised, addressed, and
finally determined in the state court litigation. Thus, they are barred by the doctrine of issue
preclusion.
“Collateral estoppel [issue preclusion] prevents the relitigation of an ultimate fact that was
determined by a valid and final judgment in a prior action.” In re Hill, 957 F.3d 704, 710 (6th Cir.
2020). Specifically, issue preclusion “precludes relitigation of issues of fact or law actually
litigated and decided in a prior action between the same parties and necessary to the judgment,
even if decided as part of a different claim or cause of action.” Heike v. C. Mich. Univ. Bd. of Trs.,
573 F. App’x 476, 480 (6th Cir. 2014) (quoting Sanders Confectionery Prods., Inc. v. Heller Fin.
Inc., 973 F.2d 474, 480 (6th Cir. 1992) (brackets and internal quotation marks omitted)).
“[F]ederal court[s] must give to a state-court judgment the same preclusive effect as would
be given that judgment under the law of the State in which the judgment was rendered.” Migra v.
Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75, 81 (1984).
Thus, this Court must look to Kentucky law to determine what preclusive effect Kentucky
courts would give to the Bullitt Circuit Court foreclosure judgment. Id. Under Kentucky law, issue
preclusion, requires four elements: “(1) the issue in the second case must be the same as the issue
in the first case. In addition, the issue must have been (2) actually litigated, (3) actually decided,
and (4) necessary to the court’s judgment.” See Hill, 957 F.3d at 711 (quoting Coomer v. CSX
Transp., Inc., 319 S.W.3d 366, 374 (Ky. 2010) (internal quotations omitted)).
Plaintiff’s Count I requests a declaratory judgment as to “person entitled to enforce note.”
Count II asserts the validity of the lien cannot be determined without a “chain of transfers”
established by evidence that “either Defendant is the proper party entitled to enforce the note and
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mortgage.” Count IV alleges that the Proof of Claim does not contain sufficient information to set
forth the claimed arrearage and balance.
In reviewing the Plaintiff’s factual allegations for purposes of Rule 12(b)(6), the Court
notes that most of the allegations in the Complaint are legal arguments or conclusory legal
statements. (See, e.g., Complaint ¶¶ 28–40, Dkt. No. 1.) With respect to any pertinent actual factual
allegations, the Plaintiff alleges:
(i) 	The Proof of Claim identifies NewRez as the creditor. (Compl. ¶¶ 15, 43.)
(ii) 	The Bullitt Circuit Court judgment identifies the Bank as the creditor.
(Compl. ¶ 15.)
(iii) 	The allonge “appears facially incomplete.” (Compl. ¶¶ 17, 44.)
(iv) 	The current record does not contain evidence establishing a chain of
enforcement rights for the Note. (Compl. ¶¶ 18, 45.)
(v) 	There is no sworn evidence of possession of the note. (Compl. ¶ 46.)
(vi) 	The 	Proof 	of 	Claim 	does 	not 	include 	sworn 	custodian 	statements,
underlying invoices, or information to validate the balance owed. (Compl.
¶ 20.)
All of Plaintiff’s claims in Counts I, II, and IV, however, have been adjudged by the
Kentucky courts and the above allegations, even if true, do not change that result. At the hearing,
Plaintiff effectively conceded that the Bank had a valid judgment by agreeing this Court could not
act as a forum for further appeal of the state court proceedings. Plaintiff’s response to the Motion
consistently also admits as much in that Plaintiff states she is not asking for review of the state
court proceedings: “Plaintiff recognizes an important limit. She is not asking this Court to sit as an
appellate court over the Bullitt Circuit Court, to vacate the foreclosure judgment, or to redetermine
matters that the state court actually and finally decided.” (Pl.’s Resp. in Opp’n, p. 1, Dkt. No. 17.)
The Court takes this admission into consideration in considering Counts I, II, and IV under the
four elements required for issue preclusion under Kentucky law:
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Count I – Declaration as to who is entitled to enforce the Note
Count II – The lien is invalid because no evidence establishes the proper party entitled
to enforce the Note and Mortgage
(i) 	Counts I and II effectively make the same claim—who is entitled to enforce the
Note and Mortgage. The Kentucky courts determined the Bank (one of the two
named Defendants) was entitled to enforce the Note. That is, the enforceability of
the Note and the Bank’s standing was a determination that was necessary for the
Bullitt Circuit Court foreclosure judgment. The Kentucky Court of Appeals then
expressly recognized that the Bank established a prima facia case for foreclosure
under applicable Kentucky law, including the existence of a note and mortgage.
Cox, 2025 WL 1141847 at *2 (citing Louthan v. Dollar Bank, FSB, No. 2018-CA-
000820-MR, 2020 WL 2298431, at *5 (Ky. App. May 8, 2020)). Then, the
Kentucky Court of Appeals expressly and directly dealt with the Plaintiff’s
allegations regarding the Bank’s standing and ability to collect against the Note in
the foreclosure action, affirming the Bullitt Circuit Court. Thus, the issues were
raised and litigated in the prior proceeding, as subsequently affirmed on appeal.5
(ii) 	The Plaintiff had a full and fair opportunity to litigate these issues in the prior
proceeding––including appealing to the Kentucky Supreme Court.
(iii) 	The Bullitt Circuit Court judgment as affirmed by the Kentucky Court of Appeals
established the issues were decided.
5 	At the hearing before this Court, the Plaintiff stated that she had not been provided sufficient opportunity to
litigate all her claims regarding the bases for foreclosure in the state courts. The Kentucky Court of Appeals briefly
addressed this issue and declined to recreate Plaintiff’s record. Cox, 2025 WL 1141847 at *2. Moreover, Plaintiff has
not provided this Court with any legal arguments or documents of record in the state court proceedings providing that
she did not have a fulsome opportunity to raise all issues before the Bullitt Circuit Court, that the appeal is anything
other than final, or that any other appeals are pending or even available.
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(iv) 	Finally, all these determinations are necessary prerequisites for a foreclosure
judgment.
Count IV – NewRez’s Proof of Claim does not have sufficient information regarding
the amount owed
(i) 	Preliminarily, the Plaintiff’s in this Count is misplaced and moot because it is
effectively an objection to NewRez’s Proof of Claim. This Court disallowed
NewRez’s Proof of Claim based on Plaintiff’s objection to that claim. To the extent
this Count can be construed as challenging the state court judgment amount, the
Bullitt Circuit Court entered a final judgment for a specific amount plus interest.
The Proof of Claim NewRez filed for purposes of the Plaintiff’s bankruptcy
proceedings does not change the final judgment. Thus, for purpose of issue
preclusion, the Kentucky state courts have issued a final judgment amount.
(ii) 	The Plaintiff had the same opportunity to litigate the judgment amount, including
via appeal, just like Counts I and II.
(iii) 	The Bullitt Circuit Court actually decided the judgment amount and interest rate.
(iv) 	This finding was also necessary prior to a foreclosure.
Plaintiff’s Response to the Motion requested an opportunity to amend the Complaint to
reform the allegations into something other than a collateral attack upon the state court rulings.
These Counts I, II, and IV, however, cannot be reformed. As the Defendants accurately point out,
Counts I, II, and IV raise arguments that were either considered and rejected by the Bullitt Circuit
Court in the foreclosure matter, or considered and rejected by the Kentucky Court of Appeals. In
addition, Count IV was mooted by this Court’s disallowance of NewRez’s Proof of Claim.
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In sum, for purposes of issue preclusion, the result of the state court proceedings is a final
decision that a valid note and mortgage encumber the Plaintiff’s property, that Plaintiff defaulted,
and the amount of the default.
B. 	Count III
Count III alleges that NewRez has not provided evidence that it is the servicer of the Loan
and has the authority to enforce or obtain other relief related to the Loan and Mortgage. As noted
above, Plaintiff’s statements at the hearing and in her response to the Motion assert that she is not
attempting to circumvent the final state court proceedings. (Pl.’s Resp. in Opp’n, p. 1, Dkt. No.
17.) Thus, Plaintiff, as she must, concedes there is a valid lien on her property that is the subject
of a foreclosure judgment. It appears that Plaintiff is now contending that while the Bank could
foreclose on the valid lien under the state court judgment, that NewRez cannot. That is, the Bank
is the party to the judgment, but NewRez is not. So, while the lien is valid as to the Bank, Plaintiff
is not subject to enforcement by NewRez. This is effectively the same claim Plaintiff raises in
Count III in which Plaintiff challenges NewRez’s ability to pursue the judgment stating: “A
servicer does not obtain enforcement rights by merely stating that it is a servicer. A servicer must
prove the identity of the actual note holder and its own authority to act for that holder.”
First, as held above, the issue of proof of the identity of the holder of the Note was
determined in the state court proceedings and is subject to issue preclusion. Cox, 2025 WL 1141847
at *3 (“This argument is refuted by the record, as the note is endorsed by Mortgage Research
Center, LLC and Appellee is the holder of the note. See KRS 355.3-301.”).
Second, reading the allegation in the light most favorable to the Plaintiff, it appears she is
alleging that NewRez has not shown how it has the right to pursue the Bullitt Circuit Court
foreclosure judgment. The Plaintiff’s allegation, however, is conclusory. Plaintiff does not point to
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any evidence or allege any fact that demonstrates NewRez is not either (i) the servicer or (ii) the
assignee of the Mortgage. In fact, in documentation of record with the Proof of Claim filed before
this adversary proceeding, NewRez provided an Assignment of Mortgage from the Bank to
NewRez dated May 9, 2025, notarized that same date, and recorded with the Bullitt County Clerk’s
Office in Deed Book 1137, Page 662. (NewRez Proof of Claim, ECF p. 55, Main Case Claims
Register, Claim 7-1.) As stated on its signature page, the Proof of Claim was signed and submitted
by NewRez under penalty of perjury. Thus, contrary to the allegations of the Complaint, the record
contains sworn evidence that NewRez is the assignee of the Mortgage from the Bank.
The Plaintiff alleges no facts in the Complaint addressing the Assignment of Mortgage,
much less facts to support a finding that the Assignment of Mortgage is invalid or even that
NewRez is only a “servicer” (to the extent that even is a cause of action). After multiple
opportunities on the record at the hearing to provide any basis to challenge the validity of the
Assignment of Mortgage, Plaintiff was unable to do so. Thus, Count III does not contain
allegations of sufficient plausibility challenging NewRez’s standing or regarding the facial
invalidity of the Assignment of Mortgage to NewRez under Iqbal and Twombly. Simply stating a
conclusion that a document does not exist, with no supporting facts, is not sufficient to allege a
claim under Rule 12(b)(6).
C. 	Count V
Count V is a different matter. In Count V, the Plaintiff challenged any postpetition fees and
expenses charged by the Defendants. While this issue is not subject to issue preclusion because the
Main Case was not filed at the time of the state court proceedings, Count V must also be dismissed
for several reasons. First, as noted above, Plaintiff’s debt owed to the Defendants is limited to the
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amount decided by the state court judgment, plus interest.6 Second, and as also noted above, to the
extent that NewRez’s Proof of Claim sought to add postpetition amounts, its claim has already
been disallowed by a previous ruling from this Court. Finally, at the hearing, counsel for the
Defendants stated that the Defendants were not seeking any additional sums beyond the amount
awarded by the state court. Thus, Count V fails to state a claim regarding collection of any
postpetition amounts, because none are in issue. The issue is moot following the disallowance of
NewRez’s proof of claim.7
D. 	Count VI
Count VI is the RESPA count. This allegation was not addressed in the state court litigation.
There is no final adjudication on this issue. Thus, issue preclusion does not apply with respect to
this Count. In its Reply to the Plaintiff’s Response to the Motion, the Defendants contend that the
Complaint must identify an actionable violation and allege facts sufficient to support the relief
requested. To this point the Defendants are correct. Plaintiff must plead with more specificity
exactly what the Defendants allegedly did or did not do, and how those actions or inactions violate
the provisions of RESPA.
As such, the Court will allow the Plaintiff to amend her Complaint with respect to Count
VI to flesh out the allegations regarding an alleged violation of RESPA. This direction should not
be read as permission to re-raise all the issues in the Complaint, but instead an opportunity to
address only the allegation with respect to any alleged particular RESPA violations.
6 	The Bullitt Circuit Court granted a judgment in favor of the Defendants in the principal sum of $437,314.83,
plus interest at the rate of 2.75% per annum from July 1, 2021 until paid.
7 	In addition and as stated above, issue preclusion applies with respect to the decision by the Bullitt Circuit
Court, as affirmed by the Kentucky Court of Appeals, as to the foreclosure amount. This amount is the same as in
issue in the state court proceedings. The issue was litigated, decided, and a necessary requirement for a foreclosure
proceeding. Cox, 2025 WL 1141847 at *2 (“Appellee made a prima facie case for the foreclosure.”).
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E. 	Count VII
Finally, Count VII sought injunctive relief to prevent the Defendants from proceeding with
the state court foreclosure action. This Count must also be dismissed because, in the Main Case,
the Court has already determined that the automatic stay should be terminated to allow NewRez
to proceed with the foreclosure action. In other words, the issue of allowing the Defendants to go
forward was considered and addressed in an earlier ruling. As such, the request set forth in this
Count must be dismissed as moot.
Conclusion
The Court finds that, taking everything stated in the Complaint as true, portions of the
Complaint should be dismissed. Dismissal is required for the claims alleged in Counts I, II, and
IV because they were raised, litigated and adjudicated in state court. Due to the facially valid
Mortgage Assignment, dismissal is also appropriate regarding the Count III claim challenging
NewRez’s standing to enforce the judgment, Note, and Mortgage. Dismissal is also appropriate for
Count V addressing postpetition fees and expenses that have not been claimed. Finally, dismissal
is appropriate for Count VII requesting injunctive relief on a matter that was addressed in the main
case, namely the issue of whether the Defendants should be allowed to continue their foreclosure
in state court. Count VI, however, does not fit into those categories. The allegations in that Count,
vague as they are, were not addressed in the state court litigation or in the Main Case. Because the
Count VI allegations lack specificity, the Court will allow the Plaintiff time to amend the
Complaint to provide more factual support solely with respect to any alleged particular RESPA
violations. A separate Order consistent with this Memorandum Opinion will be entered this same
date.
Mary E. Naumann
United States Bankruptcy Judge
Dated: September 17, 2026
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UNITED STATES BANKRUPTCY COURT
WESTERN DISTRICT OF KENTUCKY
LOUISVILLE DIVISION
In re:
VALENCIA COX,
Debtor.
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)
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CASE NO. 25-32857
CHAPTER 13
VALENCIA COX,
Plaintiff,
vs.
NEWREZ LLC D/B/A SHELLPOINT
MORTGAGE SERVICING and
THE BANK OF NEW YORK MELLON
TRUST COMPANY, N.A.,
Defendants.
)
)
)
)
)
)
)
)
)
)
)
AP NO. 26-3035
ORDER
Pursuant to the Court’s Memorandum entered this date and incorporated herein by
reference, and the Court being otherwise sufficiently advised,
IT IS ORDERED that:
1. 	The Defendants’ Motion to Dismiss is granted with respect to Counts I-V and Count
VII of the Plaintiff’s Complaint.
2. 	Defendants’ Motion to Dismiss is denied with respect to Count VI, the RESPA
Count.
3. 	Plaintiff is directed to amend the Complaint with respect to Count VI, providing
more specificity solely as to the allegations raised regarding a RESPA violation,
within 14 days.
4. 	By separate order, the Court will set a new pre-trial conference to determine the
next steps in this adversary proceeding.
Mary E. Naumann
United States Bankruptcy Judge
Dated: September 17, 2026
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