govinfo:USCOURTS-laed-2_25-cv-01634-1

1 
 
 
 
UNITED STATES DISTRICT COURT 
EASTERN DISTRICT OF LOUISIANA 
 
 
JARED HOTARD CIVIL ACTION 
 
VERSUS NO: 25-1634 
 
PENNYMAC LOAN SERVICES, LLC SECTION: “H” 
 
 
ORDER & REASONS 
 Before the Court is Defendant PennyMac Loan Services, LLC’s Motion 
to Dismiss (Doc. 36). For the following reasons, the Motion is GRANTED. 
 
BACKGROUND 
Plaintiff Jared Hotard brought this action in the 40th Judicial District 
Court for the Parish of St. John against his mortgage holder, Defendant 
Pennymac Loan Services, LLC . Plaintiff is the owner of property located at 
3508 Main Street, LaPlace, Louisiana. Plaintiff alleges that his property 
sustained damage during Hurricane Ida and a subsequent fire, and Plaintiff 
filed a claim with his insurer. His insurer was later placed into receivership 
and the Louisiana Insurance Guaranty Association became responsible for 
Plaintiff’s insurance claims. Plaintiff and the Louisiana Insurance Guaranty 
Association settled his claims, and Defendant, as mortgagee on the property, 
was included as an additional payee on the settlement checks. Plaintiff alleges 

2 
 
that Defendant refused to release the funds owed to Plaintiff to reimburse him 
for repairs to his home for three months. Plaintiff alleges that when Defendant 
ultimately released the funds, it failed to pay Plaintiff interest on those 
amounts as required by Louisiana Rev ised Statutes § 6:337. Plaintiff brings 
claims for monetary and injunctive relief for Defendant’s violation of § 6:337. 
Plaintiff also asserts class action allegations. 
Defendant has moved to dismiss Plaintiff’s claims, arguing that he lacks 
standing and that § 6:337 does not provide a private right of action. Plaintiff 
opposes. The Court held oral argument on this Motion on May 7, 2026. 
 
LEGAL STANDARD 
Defendant moves to dismiss Plaintiff’s claim under both Federal Rule of 
Civil Procedure 12(b)(1) and (6). A Rule 12(b)(1) motion challenges the subject 
matter jurisdiction of a federal district court. “A case is properly dismissed for 
lack of subject matter jurisdiction when the court lacks the statutory or 
constitutional power to adjudicate the case.”
1 In ruling on a Rule 12(b)(1) 
motion to dismiss, the court may rely on (1) the complaint alone, presuming 
the allegations to be true, (2) the complaint supplemented by undisputed facts, 
or (3) the complaint supplemented by undisputed facts and by the court's 
resolution of disputed facts.
2 The proponent of federal court jurisdiction —in 
this case, the Plaintiff—bears the burden of establishing subject matter 
jurisdiction.3 
 
1 Home Builders Ass’n of Miss., Inc. v. City of Madison, 143 F.3d 1006, 1010 (5th Cir. 
1998). 
2 Den Norske Stats Oljesels kap As v. Heere MacVof, 241 F.3d 420, 424 (5th Cir. 2001). 
3 See Physicians Hosps. of Am. v. Sebelius, 691 F.3d 649, 652 (5th Cir. 2012). 

3 
 
To survive a Rule 12(b)(6) motion to dismiss, a plaintiff must plead 
enough facts “to state a claim for relief that is plausible on its face.”4 A claim is 
“plausible on its face” when the pleaded facts allow the court to “draw the 
reasonable inference that the defendant is liable for the misconduct alleged.”5 
A court must accept the complaint’s factual allegations as true and must “draw 
all reasonable inferences in the plaintiff’s favor.”6 The court need not, however, 
accept as true legal conclusions couched as factual allegations. 7 To be legally 
sufficient, a complaint must establish more than a “sheer possibility” that the 
plaintiff’s claims are true.8 If it is apparent from the face of the complaint that 
an insurmountable bar to relief exists and the plaintiff is not entitled to relief, 
the court must dismiss the claim. 9 The court’s review is limited to the 
complaint and any documents attached to the motion to dismiss that are 
central to the claim and referenced by the complaint.10 
 
LAW AND ANALYSIS 
 Defendant moves to dismiss Plaintiff’s claim that Defendant failed to pay 
him interest on insurance settlement proceeds in compliance with Louisiana 
Revised Statutes § 6:337 for two reasons: (1) Plaintiff lacks standing, and (2) § 
 
4 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 
U.S. 544, 547 (2007)). 
5 Id. 
6 Lormand v. U.S. Unwired, Inc., 565 F.3d 228, 232 (5th Cir. 2009). 
7 Iqbal, 556 U.S. at 678. 
8 Id. 
9 Lormand, 565 F.3d at 255–57. 
10 Collins v. Morgan Stanley Dean Witter, 224 F.3d 496, 498 (5th Cir. 2000). 

4 
 
6:337 does not provide a private right of action. This Court will consider each 
argument in turn. 
A. Standing 
 Defendant argues that Plaintiff does not have Article III standing to 
bring his claims for either monetary or injunctive relief. Defendant argues that 
Plaintiff lacks standing to bring a monetary claim because he did receive 
interest, and he lacks standing to bring a claim for injunctive relief because 
there is no threat of future injury. Defendant asks this Court to dismiss 
Plaintiff’s case for lack of subject matter jurisdiction. 
 “It is well settled that unless a plaintiff has standing, a federal district 
court lacks subject matter jurisdiction to address the merits of the case.”
11 
“Courts may dismiss for lack of subject matter jurisdiction on any one of three 
different bases: (1) the complaint alone; (2) the complaint supplemented by 
undisputed facts in the record; or (3) the complaint supplemented by 
undisputed facts plus the court’s resolution of disputed facts.”
12 “A motion to 
dismiss for lack of standing may be either facial or factual.” 13 Where, as here, 
the Defendant has made a factual attack challenging the existence of subject 
matter jurisdiction, irrespective of the pleadings, “matters outside the 
pleadings, such as testimony and affidavits are considered.”
14 
 
 
 
11 Matte v. Sunshine Mobile Homes, Inc., 270 F. Supp. 2d 805, 813 (W.D. La. 2003). 
 12 Clark v. Tarrant Cnty., 798 F.2d 736, 741 (5th Cir. 1986). 
13 Superior MRI Servs., Inc. v. All. Healthcare Servs., Inc., 778 F.3d 502, 504 (5th Cir. 
2015). 
14 Norwood v. United Med. Recovery, LLC, No. 4:21 -CV-134-DMB-JMV, 2022 WL 
4088081, at *1 (N.D. Miss. Sept. 6, 2022). 

5 
 
a. Monetary Relief 
 Defendant argues that Plaintiff has no Article III standing to bring a 
monetary claim for relief because he received interest on the insurance 
settlement proceeds at issue. Standing under Article III requires a plaintiff to 
“demonstrate a ‘personal stake’ in the suit.”15 To establish such a personal 
stake for purposes of Article III, a plaintiff must show three elements: (1) an 
“injury in fact” that is “concrete and particularized” and “actual or imminent”; 
(2) a “causal connection between the injury and the conduct complained of”; 
and (3) a likelihood, as opposed to mere speculation, that a favorable decision 
will redress the injury.
16 “When considering whether a plaintiff has Article III 
standing, a federal court must assume arguendo the merits of his or her legal 
claim.”17 
 Defendant argues that Plaintiff has not established an injury in fact. In 
support, Defendant points to a check for $2.05 in interest sent to Plaintiff on 
July 5, 2025. Defendant argues that Plaintiff has no standing to assert a claim 
for nonpayment of interest because he received the $2.05 interest payment. In 
response, Plaintiff does not contest that the $2.05 check was a payment of 
interest. Rather, he argues that $2.05 is far less than the interest he is owed 
and is based on a .01% interest rate, which is not in compliance with Louisiana 
Revised Statutes § 6:337. Defendant correctly points out, however, that 
Plaintiff’s Complaint states only that he did not receive interest, not that the 
 
15 Camreta v. Greene, 563 U.S. 692, 701 (2011) (quoting Summers v. Earth Island 
Institute, 555 U.S. 488, 493 (2009)). 
16 Lujan v. Defs. of Wildlife, 504 U.S. 555, 560-61 (1992) (internal quotations omitted). 
17 N. Cypress Med. Ctr. Operating Co. v. Cigna Healthcare, 781 F.3d 182, 191 (5th 
Cir. 2015) (quoting Cole v. Gen. Motors Corp., 484 F.3d 717, 723 (5th Cir. 2007)) ( citation 
modified). 

6 
 
interest amount paid was insufficient. Therefore, Defendant is correct that 
Plaintiff’s Complaint does not establish standing for monetary relief, and 
dismissal for lack of subject matter jurisdiction is appropriate.18 
 Plaintiff’s pleading deficiency, however, is easily remedied by an 
amendment to his Complaint. If Plaintiff alleges the interest payment was 
insufficient, he will have stated an injury in fact. Rule 15 requires that leave 
to amend be freely given when justice so requires. Accordingly, Plaintiff may 
amend his Complaint in order to properly allege standing. 
b. Injunctive Relief 
 As to the injunctive relief requested by Plaintiff —an order preventing 
Defendant from failing to pay interest on insurance settlement proceeds— 
Defendant argues that Plaintiff does not have standing for the injunctive relief 
requested because he paid off his mortgage in August 2025, and therefore there 
is no risk of future harm. Indeed, when a plaintiff seeks injunctive relief, he 
must show “a real and immediate threat of future or continuing injury apart 
from any past injury.”
19 
 Plaintiff does not directly address this argument. Instead, he argues 
that even assuming that he does not personally have standing for injunctive 
 
18 Plaintiff also argues that the voluntary cessation doctrine prevents Defendant from 
arguing that the case is moot because the $2.05 interest payment was made after Plaintiff 
filed his lawsuit. “The doctrine of voluntary cessation evaluates the risk that a defendant is 
engaging in ‘litigation posturing’ to avoid judicial review. Accordingly, it must be ‘absolutely 
clear’ that the defendant's challenged conduct ‘could not reasonably be expected to recur ’ to 
divest” the court of jurisdiction. U.S. Navy SEALs 1-26 v. Biden, 72 F.4th 666, 673 (5th Cir. 
2023) (internal quotations omitted) . As discussed in the next section, Defendant’s conduct 
cannot be expected to recur, and therefore the doctrine of voluntary cessation does not apply 
to prevent dismissal for lack of standing. 
19 Aransas Project v. Shaw, 775 F.3d 641, 648 (5th Cir. 2014) (citing In re Stewart, 647 
F.3d 553, 557 (5th Cir. 2011)). 

7 
 
relief, the other class members do. He argues that courts sometimes recognize 
standing to seek relief on behalf of class members even where the named 
plaintiff’s claim is moot. The cases Plaintiff cites in support of this proposition, 
however, are easily distinguishable because they involve cases in which a class 
is already certified or a class certification motion is pending. 20 In Zeidman v. 
J. Ray McDermott & Co., for example, the question before the court was 
whether “a purported but uncertified class action” should be “dismissed for 
mootness upon tender to the named plaintiffs of their personal claims, despite 
the existence of a timely filed and diligently pursued pending motion for class 
certification.”
21 In considering this question, the Fifth Circuit acknowledged 
that the general principle is “that a purported class action becomes moot when 
the personal claims of all named plaintiffs are satisfied and no class has 
properly been certified. In such a case there is no plaintiff (either named or 
unnamed) who can assert a justiciable claim against any defendant and 
consequently there is no longer a ‘case or controversy’ within the meaning of 
Article III of the Constitution.”
22 Accordingly, because a class has not been 
certified, Plaintiff cannot rely on the claims of future possible class members 
to establish standing for injunctive relief. Further, because he has paid off the 
 
 20 See Sosna v. Iowa, 419 U.S. 393, 399 (1975) (“If appellant had sued only on her own 
behalf, both the fact that she now satisfies the one -year residency requirement and the fact 
that she has obtained a divorce elsewhere would make this case moot and require dismissal. 
But appellant brought this suit as a class action and sought to litigate the constitutionality 
of the durational residency requirement in a representative capacity. When the District 
Court certified the propriety of the class action, the class of unnamed persons described in 
the certification acquired a legal status separate from the interest asserted by appellant. We 
are of the view that this factor significantly affects the mootness determination.”). 
21 651 F.2d 1030, 1041 (5th Cir. 1981). 
22 Id. 

8 
 
mortgage at issue, he cannot show a “real and immediate threat of future or 
continuing injury apart from any past injury.” 23 Plaintiff therefore does not 
have standing for the injunctive relief requested. Dismissal for lack of subject 
matter jurisdiction is appropriate here as well. No leave to amend is granted 
as amendment would be futile.24 
B. Private Right of Action 
 Although the Court has already determined that dismissal for lack of 
subject matter jurisdiction of Plaintiff’s claims for both monetary and 
injunctive relief is appropriate, the Court has also stated its intention to allow 
Plaintiff to amend his Complaint to allege standing as to his claim for 
monetary relief. Accordingly, the Court will consider Defendant’s final 
argument for dismissal as well. 
 Defendant argues that Plaintiff’s claim should be dismissed because 
Louisiana Revised Statutes § 6:337 does not create a private right of action. 
Section 6:337 outlines certain duties of mortgagees and servicers vis-à-vis 
insurance settlement proceeds on residential properties, including that the 
proceeds should be deposited into a segregated account, that they should be 
promptly distributed under certain circumstances, and that they should accrue 
interest.
25 Section 6:337 also provides that the insurance commissioner can 
 
23 Aransas Project, 775 F.3d at 648. 
24 When denying a motion to amend, the court must have a “substantial reason” 
considering such factors as “undue delay, bad faith or dilatory motive on the part of the 
movant, repeated failures to cure deficiencies by amendments previously allowed, undue 
prejudice to the opposing party . . . and futility of the amendment.” Marucci Sports, LLC v. 
Nat’l Collegiate Athletic Ass'n, 751 F.3d 368, 378 (5th Cir. 2014) (citation modified). An 
amendment is deemed to be futile if it would be dismissed under a Rule 12(b)(6) motion. Id. 
25 LA. REV. STAT. § 6:337. 

9 
 
impose penalties for the violation of these duties. 26 The statute is silent as to 
any right of the borrower to bring a claim for violation of the duties established 
therein. Defendant argues therefore that it does not provide a private right of 
action and that if the legislature intended to create a private right of action, it 
would have done so. 
 In response, Plaintiff relies on Anderson v. Ochsner Health in which the 
Louisiana Supreme Court considered whether there was a private right of 
action under the Balance Billing Act.
27 There too, the statute was silent on the 
existence of a private right of action, so the Court looked to legislative intent.28 
The Balance Billing Act expressly provides that an insured who has been billed 
in violation of the Act can file a complaint with the attorney general and 
instructs that the attorney general “may pursue remedies.” 29 The defendant 
argued that the inclusion in the Balance Billing Act of an administrative 
remedy precluded a private right of action.
30 The Louisiana Supreme Court 
disagreed.31 The Court found “an implied private right of action exists under 
La. R.S. 22:1871, et seq. based on (1) the legislature’s failure to expressly 
prohibit an individual remedy; (2) the legislative intent to protect consumers; 
and (3) the constitutional right of access to the courts in order to seek personal 
relief.”
32 The Court found that “the legislature enacted this statutory scheme 
 
26 Id. § 6:337(c)(4) (“The commissioner may impose civil money penalties of up to five 
hundred dollars per day for each day that a mortgagee or mortgage servicer fails to comply 
with the requirements of Paragraph (1) or (2) of this Subsection.”). 
27 172 So. 3d 579 (La. 2014). 
28 Id. 
29 Id. 
30 Id. 
31 Id. 
32 Id. at 586. 

10 
 
with protection of the consumer in mind. Accordingly, it is difficult to envision 
a law denying recourse to individuals when that law ’s principle aim is 
individual protection.”33 It held that the power granted to the attorney general 
in the Act is discretionary and therefore “further evidences the existence of an 
implied private right of action.”
34 It noted that “[a] person’s individual right to 
seek recourse for an alleged wrong should not depend on a governmental body's 
decision to pursue the offender.”
35 
 Plaintiff argues that this Court should reach the same result as in 
Anderson. Here too, § 6:337 does not expressly prohibit a private right of action, 
was enacted for the protection of residential borrowers whose insurance 
settlements are sent to their mortgage servicers, and the power granted to the 
insurance commissioner to impose penalties is permissive. Section 6:337 
provides only that the commissioner “may impose civil money penalties of up 
to five hundred dollars per day for each day that a mortgagee or mortgage 
servicer fails to comply with the requirements” of the statute. This Court 
agrees that the analysis in Anderson is squarely on point with the question 
presented here. 
 Defendant attempts to distinguish Anderson by pointing out that the 
Balance Billing Act expressly incorporates the Louisiana Unfair Trade 
Practices Act (“LUTPA”) as an enforcement mechanism. But this misconstrues 
the Anderson Court’s opinion and the Act itself. LUTP A is incorporated into 
the Balance Billing Act with respect to the attorney general’s enforcement 
 
33 Id. at 584. 
34 Id. 
35 Id. 

11 
 
rights.36 The Louisiana Supreme Court simply observed that the Act’s 
incorporation of LUTPA suggested the legislature’s intent to expose violators 
to more liability, not less. 37 The Court does not base its finding of a private 
right of action on the Balance Billing Act’s incorporation of LUTPA. That said, 
Defendant has failed to meaningfully distinguish the Louisiana Supreme 
Court’s decision in Anderson. 
 For its part, Defendant relies on cases from this Court that found no 
private right of action in the Louisiana Motor Vehicles Act (“LMVA”). For 
example, in Crescent City M Dealership, L.L.C. v. Mazda Motor of America , 
Inc., a section of this Court stated that “the grant of such broad regulatory and 
enforcement powers to a state agency [in the LMVA] forecloses a private right 
of action, absent language expressly granting one.”
38 However, this case is 
easily distinguishable where the LMVA provides a much more robust 
enforcement scheme than is present here and the enforcement powers granted 
by it to the state agency are not discretionary.39 Indeed, a court in the Western 
 
36 LA. REV. STAT. § 22:1877(A)(6) (“In the event that a contracted health care provider 
fails to comply with a notice of unfair trade practices, the attorney general may proceed in 
accordance with the Unfair Trade Practices and Consumer Protection Law, R.S. 51:1401 et 
seq.”). 
37 Anderson, 172 So. 3d at 584 (“The Balance Billing Act ’s reference to and 
incorporation of these Unfair Trade Practices and Consumer Protection provisions serve to 
illustrate the legislature’s intention of exposing violators to more liability, not less.”). 
38 Crescent City M Dealership, L.L.C. v. Mazda Motor of Am., Inc., No. CIV. A. 00 -
1620, 2000 WL 1372965, at *2 (E.D. La. Sept. 22, 2000), aff’d, 275 F.3d 43 (5th Cir. 2001). 
39 “The LMVA empowers only the LMVC to enforce the provisions of the Act. The 
Commission has the power to grant, deny, and revoke licenses for motor vehicle dealerships, 
to hold hearings, subpoena witnesses, impose civil penalties for violations of the Act, and 
order renewal or reinstatement of a dealer's franchise that a manufacturer has canceled 
without just cause. The Act also empowers the Commission to institute an injunctive action 
to enforce its provisions, and to enter cease and desist orders prohibiting conduct in violation 
of the Act. Thus, the LMVA constitutes a comprehensive regulatory scheme that confers upon 

12 
 
District of Louisiana made the same distinction between Anderson and 
Crescent City, stating that unlike the Balance Billing Act, “the LMVA creates 
a comprehensive regulatory scheme and an administrative complaint process 
that can be invoked by an aggrieved dealer.”40 Likewise, Defendant cites to 
Stokes v. Southwest Airlines, in which the Fifth Circuit held that the Air 
Carrier Access Act did not provide a private right of action where it created a 
mandatory “comprehensive administrative scheme designed to vindicate fully 
the rights of disabled persons.”
41 The cases cited by Defendant, in addition to 
being non-binding, involve robust and comprehensive administrative remedies 
unlike the permissive enforcement powers granted by the Balance Billing Act 
in Anderson or § 6:337 at issue here. This Court finds these cases easily 
distinguishable, 
 This Court finds that in reliance on Anderson, § 6:337 creates a private 
right of action based on “(1) the legislature’s failure to expressly prohibit an 
individual remedy; (2) the legislative intent to protect consumers; and (3) the 
constitutional right of access to the courts in order to seek personal relief.”
42 
The Court finds compelling the fact that the remedy created by § 6:337 provides 
 
the Commission the power and authority to implement its purpose .” Id.; LA. REV. STAT. § 
32:1259 (“If it appears to the commission at any time that a person is violating the provisions 
of this Chapter or any rule or order of the commission issued pursuant to this Chapter, it 
shall notify the person engaged in such conduct to appear and show cause why a cease and 
desist order should not be issued prohibiting the proscribed conduct.”). 
40 Navarre Chevrolet, Inc. v. Hyundai Motor Am. Corp., No. 2:18 -CV-0327, 2019 WL 
2166679, at *3 (W.D. La. Feb. 4, 2019). 
41 887 F.3d 199, 202– 03 (5th Cir. 2018) . (“If, after an investigation and hearing, the 
DOT finds an ACAA violation, it must issue an order compelling compliance, id. § 46101(a)(4), 
and may further revoke the airline’s air carrier certificate, id. § 41110(a)(2)(B), or impose 
civil penalties of up to $25,000 for each act of discrimination.”). 
42 Anderson, 172 So. 3d at 586. 

13 
 
no recourse to a borrower whose mortgage servicer violates its provisions. The 
statute provides only for a penalty to be imposed by the insurance 
commissioner.43 There is no process outlined for an aggrieved borrower to 
complain to the insurance commissioner, and there is no indication that any 
amount of the penalty will be distributed to the borrower to make him whole. 
Just as in Anderson, the commissioner is “seeking to obtain relief that will not 
directly benefit the plaintiff.” 44 Further, the commissioner is under no 
obligation to impose a penalty for violations of § 6:337. “A person’s individual 
right to seek recourse for an alleged wrong should not depend on a 
governmental body’s decision to pursue the offender.”45 Finally, the text of the 
statute makes clear that it was enacted “with protection of the consumer in 
mind.”
46 The statute imposes duties on mortgagees or mortgage servicers 
servicing residential mortgage loans relative to the disbursement of insurance 
proceeds and seeks: 
to provide for prompt endorsement; to require prompt payment to 
borrower-payees in certain circumstances; to require placement of 
settlement proceeds in a segregated account; to provide for 
requirements for a residential mortgagee or mortgage servicer; to 
provide for the payment of proceeds relative to additional living 
expenses and contents insurance; to provide for notice by a 
mortgagee or mortgage servicer in certain circumstances; to 
provide for the release of proceeds held by a mortgagee or mortgage 
servicer; to provide for civil money penalties; to provide for the 
payment of interest accrued on settlement proceeds; to provide for 
 
43 LA. REV. STAT. § 6:337(c)(4) (“The commissioner may impose civil money penalties 
of up to five hundred dollars per day for each day that a mortgagee or mortgage servicer 
fails to comply with the requirements of Paragraph (1) or (2) of this Subsection.”). 
44 Anderson, 172 So. 3d at 584. 
45 Id. 
46 Id. 

14 
 
release of excess funds upon written request; to provide for 
applicability; and to provide for related matters.47 
This Court therefore finds that § 6:337 creates “an implied right of action based 
on the legislative purpose and the spirit of the law.”48 
 
CONCLUSION 
For the foregoing reasons, the Motion to Dismiss is GRANTED for lack 
of subject matter jurisdiction. IT IS FURTHER ORDERED that Plaintiff 
may amend his Complaint within 20 days of this Order to the extent that he 
can allege standing. Failure to amend will result in dismissal. 
 
 New Orleans, Louisiana this 18th day of May, 2026. 
 
 
____________________________________ 
 JANE TRICHE MILAZZO 
 UNITED STATES DISTRICT JUDGE 
 
47 Louisiana House Journal, 2022 Reg. Sess. No. 44 (House Bill No. 1064). 
48 Id. at 585. 

Passage view · GavelSight