author: SHWARTZ, Circuit Judge.

text:
    IN RE: VEHICLE CARRIER SERVICES ANTITRUST LITIGATION Direct Purchaser Plaintiffs Cargo Agents, Inc.; International Transport Management Corp.; and Manaco International Forwarders, Inc.; Appellants in 15-3853 Martens Cars of Washington, Inc.; Hudson Charleston Acquisition, LLC d/b/a Hudson Nissan; John O’Neil Johnson Toyota, LLC; Hudson Gastonia Acquisition, LLC; HC Acquisition, LLC d/b/a Toyota of Bristol; Desert European Motorcars, Ltd; Hodges Imported Cars, Inc. d/b/a Hodges Subaru; Scotland Car Yard Enterprises d/b/a San Rafael Mitsubishi; Hartley Buick/ GMC Truck, Inc. d/b/a Hartley Honda; Panama City Automotive Group, Inc. d/b/a John Lee Nissan; Empire Nissan of Santa Rosa, LLC, Appellants in 15-3354 End Payor Plaintiffs; Truck and Equipment Dealer Plaintiffs, Appellants in 15-3355
    Nos. 15-3353, 15-3354 and 15-3355
    United States Court of Appeals, Third Circuit.
    Argued: November 17, 2016
    (Opinion Filed: January 18, 2017)
    As Amended January 25, 2017

      Kit Pierson, Christopher J. Cormier, David A. Young, Cohen Milstein Sellers & Toll PLLC, 1100 New York Avenue, N.W., Suite 500 West, Washington, D.C. 20005, Robert N. Kaplan, Richard J. Kilsheimer [ARGUED], Gregory K. Arenson, Joshua H. Saltzman, Kaplan Fox & Kilsheimer LLP, 850 Third Avenue, 14th Floor, New York, NY 10022, Steven A. Kanner, Michael J. Freed, Michael E. Moskovitz, Freed Kanner London & Millen LLC, 2201 Waukegan Road, Suite 130, Bannock-burn, IL 60015, Lewis H.' Goldfarb, McEl-roy, Deutsch, Mulvaney & .Carpenter, LLP, 1300 Mount Kemble Avenue, P.O. Box 2075, Morristown, NJ 07962, Solomon B. Cera, C. Andrew Dirksen, Cera LLP, 595 Market Street, Suite 2300, San Francisco, CA 94105, Joseph C. Kohn, Douglas A. Abrahams, William E. Hoese, Kohn Swift & Graf, P.C., One South Broad Street, Suite 2100, Philadelphia, PA 19107, Lee Albert, Gregory B. Linkh, Glancy Prongay & Murray LLP, 122 East 42nd Street, Suite 2920, New York, NY 10168, Gregory P. Hansel, Randall B. Weill, Michael Kaplan, Jonathan G. Mermin, Michael S. Smith, Preti, Flaherty, Beliveau & Pachios LLP, One City Center, P.O. Box 9546, Portland, ME 04112, Eugene. A. Spector, Jeffrey J. Corrigan, Jay S.- Cohen, Rachel E. Kopp, Spector Roseman Kodroff & Willis, P.C., 1818 Market Street, Suite 2500, Philadelphia, PA 19103, W. Joseph Bruckner, Heidi M. Silton, Lockridge Grindal Nausen P.L.L.P., 100 Washington Avenue South, Suite 2200, Minneapolis, MN 55401, Vincent J. Esades, Heins Mills & Olson, P.L.C., 310 Clifton Avenue, Minneapolis, MN 55403, Joseph J. DePalma, Katrina Carroll, Steven J. Greenfogel, Lite DePalma Greenberg, LLC, 570 Broad Street, Suite 1201, Newark, NJ 07102, Edward D. Greenberg, David K. Monroe, GKG Law, P.C., 1055 Thomas Jefferson Street, N.W., Suite 500, Washington, D.C. 20007, Benjamin Bianco, Gregory A. Frank, Frank LLP, 275 Madison Avenue, Suite 705, New York, NY 10016, Counsel for Appellants Cargo Agents, Inc., International Transport Management Corp., and Manaco International Forwarders, Inc.
    Peter S. Pearlman, Cohn Lifland Pearl-man Herrmann & Knopf LLP, Park 80 Plaza West-One, 250 Pehle Avenue, Suite 401, Saddle Brook, NJ 07663, Jonathon W. Cuneo, Joel Davidow, Katherine Van Dyck, Daniel Cohen, Cuneo Gilbert & La-Duca, LLP, 507 C Street N.E., Washington, D.C. 20002, Benjamin David Elga, Cu-neo Gilbert & LaDuca, LLP, 16 Court Street, Suite 1012, Brooklyn, NY 11241, Don Barrett, David McMullan, Brian Her-rington, Barrett Law Group, P.A., 404 Court Square, P.O. Box 927, Lexington, MS 39095, Shawn M. Raiter, Paul A. Sand, Larson King, LLP, 2800 Wells Fargo Place, 30 East Seventh Street, St. Paul, MN 55101, Dewitt Lovelace, Valerie Nettles, Lovelace & Associates, P.A., Suite 200, 12870 U.S. Highway 98 West, Mira-mar Beach, FL 32550, Gerard V. Mantese, David Hansma, Brendan Frey, Mantese Honigman Rossman & Williamson, P.C., 1361 East Big Beaver Road, Troy, MI 48083, Ben F. Pierce Gore, Pratt & Associates, 1871 The Alameda, Suite 425, San Jose, CA 95126, Charles Barrett, Charles Barrett, P.C., 6518 Highway 100, Suite 210, Nashville, TN 37205, Thomas P. Thrash, Thrash Law Firm, P.A., 1101 Garland Street, Little Rock, AR 72201, Armand Derfner, Derfner, Altman, & Wil-born, 575 King Street, Suite B, Charleston, SC 29403, Counsel for Appellants Martens Cars of Washington, Inc., Hudson Charleston Acquisition, LLC, d/b/a Hudson Nissan, John O’Neill Johnson Toyota, LLC, Hudson Gastonia Acquisition, LLC, HC Acquisition, LLC, d/b/a Toyota of Bristol, Desert European Motorcard, Ltd, Hodges Imported Cars, Inc., d/b/a Hodges Subaru, Scotland Car Yard Enterprises d/b/a San Rafael Mitsubishi, Hartley Buick/GMC Truck, Inc., d/b/a Hartley Honda, Panama City Automotive Group, Inc., d/b/a John Lee Nissan and Empire Nissan of Santa Rosa
    Warren T. Burns [ARGUED], Daniel H. Charest, Will Thompson, E. Lawrence Vincent, Burns Charest LLP, 500 North Ak-ard, Suite 2810, Dallas, TX 75201, Hollis Salzman, Bernard Persky, Meegan Hollywood, Robins Kaplan LLP, 601 Lexington Avenue, Suite 3400, New York, NY 10022, Joseph W. Cotchett, Steven N. Williams, Cotchett, Pitre & McCarthy, LLP, San Francisco Airport Office Center, 840 Malcolm Road, Suite 200, Burlingame, CA 94010, James E. Cecchi, Carella, Byrne, Cecchi, Olstein, Brody & Agnello, P.C., 5 Becker Farm Road, Roseland, NJ 07068, Counsel for Appellant End Payor Plaintiffs
    Eric R. Breslin, Duane Morris LLP, One Riverfront Plaza, 1037 Raymond Boulevard, Suite 1800, Newark, NJ 07102, Wayne A. Mack, J. Manly Parks, Andrew Sperl, Duane Morris LLP, 30 South 17th Street, Philadelphia, PA 19103, Counsel for Appellant Truck and Equipment Dealer Plaintiffs
    John R. Fornaciari, Robert M. Disch, Baker & Hostetler LLP, 1050 Connecticut Avenue, N.W., Suite 1100, Washington, D.C. 20036, Counsel for Appellees Nippon Yusen Kabushiki Kaisha and NYK Line North America Inc.
    James L. Cooper, Anne P. Davis, Adam-M. Pergament, Arnold <& Porter LLP, 601 Massachusetts Avenue, N.W., Washington, D.C. 20001, Robert B. Yoshitomi, Eric C. Jeffrey, Nixon Peabody LLP, 799 New York Avenue, N.W., Washington,' D.C. 20001, Counsel for Mitsui O.S.K. Lines, Ltd., Mitsui O.S.K. Bulk Shipping (U.S.A.), LLC, World Logistics Service (U.S.A.) Inc., and Nissan Motor Car Carrier Co., Ltd.
    Mark W. Nelson [ARGUED], Jeremy Calsyn, Cleary Gottlieb Steen & Hamilton LLP, 2000 Pennsylvania Avenue, N.W., Washington, D.C. 20006, Counsel for Ap-pellees Kawasaki Kisen Kaisha, Ltd. and “K” Line America, Inc.
    Roberto A. Rivera-Soto [ARGUED], Jason A. Leckerman, Ballard Spahr LLP, 210 Lake Drive East, Suite 200, Cherry Hill, NJ 08002, Benjamin F. Holt, Hogan Lovells US LLP, 655 Thirteenth Street,
    N.W., Washington, D.C. 20004, Counsel for Appellees Wallenius Wilhelmsen Logistics AS, Wallenius Wilhelmsen Logistics America LLC, and EUKOR Car Carriers, Inc.
    Steven F. Cherry, Brian C. Smith, Wilmer, Cutler, Pickering, Hale & Dorr LLP, 1875 Pennsylvania Avenue, N.W., Washington, D.C. 20006, Counsel for Appellees Compañía Sud Americana de Vapores, S.A. and CSAV Agency, LLC
    Jeffrey F. 'Lawrence, Wayne Rohde, Cozen O’Connor PC, 1200 Nineteenth Street, N.W., Washington, D.C. 20036, Melissa H. Maxman, Cohen & Gresser LLP, 1707 L Street, N.W., Suite 550, Washington, D.C. 20036, Counsel for Hóegh Autoliners AS and Hóegh Autolin-ers, Inc.
    Renata B. Hesse, James J. Fredricks, Sean Sandoloski, United States Department of Justice, Antitrust Division, Room 3224, Washington, DC 20530, Counsel for Amicus Curiae United States of America
    Tyler J. Wood, William H. Shakely, Joel F. Graham, Federal Maritime Commission, 800 North Capitol Street, NW, Washington, DC 20573, Counsel for Amicus Curiae Federal Maritime Commission
    Before: AMBRO, SHWARTZ, FUENTES, Circuit Judges.
   OPINION OF THE COURT

SHWARTZ, Circuit Judge.

Ocean common carriers transport cargo between foreign countries and the United States. In this case, Plaintiffs used the services of such carriers to transport vehicles. Some plaintiffs made arrangements with and received vehicles directly from the carriers (direct purchaser plaintiffs or “DPPs”), while other plaintiffs obtained the benefit of the carrier services by ultimately receiving vehicles transported from abroad (indirect purchaser plaintiffs or “IPPs”). Plaintiffs allege that Defendants, who are ocean common carriers, entered into agreements to fix prices and reduce capacity in violation of federal antitrust laws and various state laws. Because the ocean common carriers allegedly engaged in acts prohibited by the Shipping Act of 1984, 46 U.S.C. § 40101 et seq. (the “Shipping Act” or the “Act”), and the Act both precludes private plaintiffs from seeking relief under the federal antitrust laws for such conduct and preempts the state law claims under circumstances like those presented here, the District Court correctly dismissed the complaints. We will therefore affirm.

I

Defendants transport vehicles from their country of origin to the country where they will be sold, including the United States, at which point the vehicles are delivered to dealers and individuals, such as Auto Dealer IPPs, Truck Center IPPs, and End-Payor IPPs. The vehicle manufacturers and DPPs purchase vehicle carrier services from Defendants, and the costs of these services are passed on to IPPs.

In September 2012, law enforcement raided Defendants’ offices in connection with antitrust investigations, and several Defendants thereafter pleaded guilty to antitrust violations based on price-fixing, allocating customers, and rigging bids for vehicle carrier services to and from the United States and elsewhere.

Plaintiffs filed complaints with jury demands alleging that Defendants entered into “secret” agreements in connection with Defendants’ carriage of vehicles. These agreements included: (1) price increase coordination agreements; (2) agreements not to compete, including coordination of responses to price reduction requests and allocation of customers and routes; and (3) agreements to restrict capacity by means of agreed-upon fleet reductions. Plaintiffs claim they suffered economic injuries as a result of these agreements and seek relief under the Clayton Act for violations of the Sherman Act. IPPs also assert state antitrust, consumer fraud, and unjust enrichment claims.

Defendants moved to dismiss the complaints pursuant to Fed. R. Civ. P. 12(b)(6), claiming they are immune from antitrust liability under the Shipping Act and that the state law claims are preempted. The District Court agreed and dismissed the complaints with prejudice.

While the motions to dismiss were pending, IPPs informed the District Court that they reached a putative class action settlement in principle with two groups of defendants, “K” Line and MOL Defendants (the “Settling Defendants”), but no motions to approve any settlement were filed. After the Court dismissed the complaints, IPPs filed a motion for reconsideration under Fed. R. Civ. P. 59(e) and 60(b) and Local Civil Rule 7.1(i) alleging that, before the cases were dismissed, they had notified the Court that they agreed in principle to settle and requested that it retain jurisdiction to approve a class settlement.

The District Court denied IPPs’ motion for reconsideration because it had determined that the Federal Maritime Commission (“FMC”) was the appropriate forum to hear the dispute and because IPPs “did not identify] an intervening change in the controlling law, alert[] the Court to the availability of new evidence that was not available when the Court issued its Opinion, or allege[ ] that the Opinion was the result of a clear error of fact or law or will result in manifest injustice.” Joint App. 62-63.

Plaintiffs appeal the order dismissing the complaints and IPPs also appeal the order denying reconsideration.

II

To resolve this appeal, we must first examine the Shipping Act of 1984. Broadly, the Shipping Act establishes a uniform federal framework for regulating entities, such as ocean common carriers, and attempts to place U.S.-flag vesséls on a level economic playing field with their foreign counterparts. The Act sets forth four specific purposes:

(1) establish a nondiscriminatory regulatory process for the common carriage of goods by water in the foreign commerce of the United States with a minimum of government intervention and regulatory costs;
(2) provide an efficient and economic transportation system in the ocean commerce of the United States that is, insofar as possible, in, harmony with, and responsive to, international shipping practices;
(3) encourage the development of an economically sound and efficient liner fleet of vessels of the United States capable of meeting national security needs; and
(4) promote the growth and development of United States exports through competitive and efficient ocean transportation and by placing a greater reliance on the marketplace.

46 U.S.C. § 40101. Taken together, these purposes show that the Act seeks ,to promote economically sound, evenhanded, and efficient ocean commerce that responds to international shipping practices. See also Waterfront Comm’n of N.Y. Harbor v. Elizabeth-Newark Shipping, Inc., 164 F.3d 177, 185 (3d Cir. 1998) (“The primary purpose of the Shipping Act ... is to eliminate discriminatory treatment of shippers and carriers.”).

One way the Act sought to achieve these goals was to broaden the provisions of the prior law that provided very limited antitrust immunity. The House Committee on Merchant Marine and Fisheries, which reported on the bill, noted “[t]he perception ... that the threat of U.S. antitrust prosecution weighs much more heavily on U.S. operators than their foreign-flag competition” and recognized “the need to foster a regulatory environment in which U.S.-flag liner operators are not placed at a competitive disadvantage vis-a-vis their foreign-flag competitors.” Report of the House Committee on Merchant Marine and Fisheries, H.R. Rep. No. 98-53(1), 98th Cong., 1st Sess., at 9, 10. To address this disadvantage, the Shipping Act “exempted] from the antitrust laws those agreements and activities subject to regulation by the” FMC. H.R. Rep. No. 98-53(1), at 3. Such agreements include those that:

(1)discuss, fix, or regulate transportation rates, including through rates, cargo space accommodations, and other conditions of service;
(2) pool or apportion traffic, revenues, earnings, or losses;
(3) allot ports or regulate the number and character of voyages between ports;
(4) regulate the volume or character of cargo or passenger traffic to be carried;
(5) engage in an exclusive, preferential, or cooperative working arrangement between themselves or with a marine terminal operator;
(6) control, regulate, or prevent competition in international ocean transportation; or
(7) discuss and agree on any matter related to a service contract.

Id. § 40301.

The Act provides federal antitrust immunity for agreements filed with the FMC that address these topics. The FMC reviews each filed agreement and can seek information about it. 46 U.S.C. § 40304. If the FMC takes no action on such an agreement, that agreement becomes effective, and, pursuant to § 40307(a), the federal antitrust laws, such as the Sherman Act and the Clayton Act, “do not apply to [such] an agreement.” 46 U.S.C. §§ 40102, 40307(a). Thus, activities described in § 40301 that are undertaken pursuant to agreements filed with the FMC are immune from federal antitrust laws.

The Act also provides immunity from private antitrust suits based on conduct prohibited by the Act. For example, the Act prohibits conduct undertaken pursuant to agreements that are not effective or have been rejected. Specifically, § 41102(b) provides:

Operating contrary to agreement.—A person may not operate under an agreement required to be filed under section 40302 or 40305 of this title if—
(1) the agreement has not become effective under section 40304 of this title or has been rejected, disapproved, or canceled; or
• (2) the operation is not in accordance with the terms of the agreement or any modifications to the agreement made by the Federal Maritime Commission.

46 U.S.C. § 41102(b). If an agreement has not been filed, it cannot become effective and thus operating under such an unfiled agreement is prohibited. See 46 C.F.R. § 535.901 (“Any person operating under an agreement ... that has not been filed and that has not become effective pursuant to the Act ... is in violation of the Act....”). A party injured by activities occurring under such an unfiled, and hence not effective, agreement may not obtain Clayton Act relief. Id. § 40307(d) (stating that “[a] person may not recover damages under section 4 of the Clayton Act (15 U.S.C. 15), or obtain injunctive relief under section 16 of that Act (15 U.S.C. 26), for conduct prohibited by” the Shipping Act); see also H.R. Rep. No. 98-53(1), at 12 (“The antitrust exposure for these so-called ‘secret’ agreements is limited to in-junctive and criminal prosecution by the Attorney General, and does not carry with it any private right of action otherwise available under the antitrust laws.”).

Although the Act bars private federal antitrust lawsuits based on such prohibited conduct, it does provide an avenue for relief before the FMC. A & E Pac. Constr. Co. v. Saipan Stevedore Co., 888 F.2d 68, 71 (9th Cir. 1989). Either on a complaint filed by a private party, 46 U.S.C. § 41301(a), or its own motion, the FMC may investigate alleged violations of the Shipping Act, id § -41302. In such proceedings, the parties may engage in discovery, id. § 41303, and request hearings before the FMC, id. § 41304. If a plaintiff shows the Act has been violated, the FMC may assess penalties, id. § 41109(a), award damages of up to double the amount of the actual injury, grant attorneys’ fees, id. § 41305, and provide a means to obtain equitable relief, id. § 41307. A & E Pac. Constr. Co., 888 F.2d at 71 (noting that “while no private party may sue for damages or for injunctive relief under the antitrust laws for conduct falling within the purview of the [Shipping] Act, the FMC is empowered to order reparations, including double damages, to impose sanctions and penalties for prohibited conduct, and to file suit in federal district court against the offending party” (citations omitted)); see also Fed. Mar. Comm’n v. S.C. State Ports Auth., 535 U.S. 743, 759, 122 S.Ct. 1864, 152 L.Ed.2d 962 (2002) (“[T]he similarities between FMC proceedings and civil litigation are overwhelming.”). Congress gave the FMC this broad authority to, among other things, “provide a deterrent effect which has previously been available only by invoking the antitrust laws,” H.R. Rep. No. 98-53(1), at 4, and “end the uncertainty and delay that surrounds U.S. Government regulation of ocean liner shipping, by providing a predictable legal regime and streamlined regulatory process administered and enforced by a single independent Federal agency (the [FMC]) to better serve the needs of U.S. foreign commerce,” Report of the Senate Committee on Commerce, Science, and Transportation, S. Rep. No. 98-3, 98th Cong., 1st Sess. at 1. See also H.R. Rep. No. 98-53(1), at 12 (“[T]he remedies and sanctions provided in the Shipping Act ... will be the exclusive remedies and sanctions for violation of the Act.”); Seawinds Ltd. v. Nedlloyd Lines, B.V., 80 B.R. 181, 184, 185 (N.D. Cal. 1987) (stating that, “[b]y removing the courts from this regulatory process, Congress removed the potential for continuing regulatory uncertainty” under the antitrust laws), aff'd, 846 F.2d 586 (9th Cir. 1988).

Thus, the Shipping Act’s text, scheme, and legislative history demonstrate Congress’s intent to create a comprehensive, predictable federal framework to ensure efficient and nondiscriminatory international shipping practices,

III

Mindful of this framework, we will first address whether the Shipping Act bars Plaintiffs’ Clayton Act claims. There is no dispute that operating under unfiled price fixing and/or market allocation agreements is prohibited under §§ 40301 and 40302 of the Shipping Act.

Plaintiffs assert, however, that the Shipping Act does not prohibit a carrier from operating under unfiled agreements to restrict capacity. For support, they point to a statement by an FMC Commissioner made at a trade symposium during which he said that agreements to restrict capacity “would be outside of the Shipping Act purview.” DPP Appellants’ Br. 24. Plaintiffs assert that we should treat this comment as the agency’s interpretation of a statute it administers. This argument fails for several reasons. First, the Commissioner stated that “[m]y remarks today reflect my personal views and thoughts and are not offered as the official position of the United States or the Federal Maritime Commission.” Joint App. 39-40. Second, and relatedly, Chevron deference only applies to agency action, and by his own statements the Commissioner acknowledged that he was not speaking or acting for the agency. Thus, Chevron deference is not applicable. See Chevron, U.S.A, Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984); Br. for Fed. Mar. Comm’n and United States as Amici Curiae 16 n.22.

Moreover, the Commissioner’s statement is undermined by the Act itself. Sections 40301(a)(3) and (4) require parties to file agreements that restrict capacity. For example, § 40301(a)(4) requires carriers to file agreements that “regulate the volume or character of cargo or passenger traffic to be carried.” Relatedly, § 40301(a)(3) requires carriers to file agreements that “regulate the number and character of voyages between ports.” Entering agreements concerning these activities without filing them is prohibited.

Plaintiffs allege they were injured by acts taken pursuant to these unfiled, and thus prohibited, agreements and seek damages under the Clayton Act. The Shipping Act, however, bars them from obtaining Clayton Act relief. Id. § 40307(d); see Seawinds, 80 B.R. at 183 (“The Shipping Act of 1984 expressly bars private, antitrust suits based on conduct prohibited by the Act.”). As explained above, the Shipping Act specifically provides that operating under an unfiled, and hence ineffective, agreement is a prohibited act, id. § 41102(b), and those injured by such a prohibited act cannot obtain Clayton Act relief, id. § 40307(d).

Plaintiffs nonetheless argue that Clayton Act immunity set forth in § 40307(a) must be read in light of § 40307(d) and suggest that the two provisions cover the same subjects. They are mistaken. In § 40307(a), Congress granted immunity from antitrust prosecution for conduct permitted by the Shipping Act, while in § 40307(d) Congress provided immunity from private Clayton Act liability for conduct prohibited by the Shipping Act. Plaintiffs’ reading destroys this carefully drawn delineation.

For all of these reasons, Plaintiffs cannot obtain Clayton Act relief, and the District Court correctly dismissed Plaintiffs’ Clayton Act claims.

IV

We next examine whether the District Court correctly concluded that IPPs’ state law antitrust, consumer protection, and unjust enrichment claims are preempted.

A

The preemption doctrine is based on the Supremacy Clause, which provides that “the Laws of the United States ... shall be the supreme Law of the Land ... any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.” U.S. Const. art. VI, cl. 2. Congress thus has the power to preempt state law. Arizona v. United States, 567 U.S. 387, 132 S.Ct. 2492, 2500, 183 L.Ed.2d 351 (2012) (citation omitted).

Preemption is an affirmative defense, In re Asbestos Prods. Liab. Litig. (No. VI), 822 F.3d 125, 133 n.6 (3d Cir. 2016), and so we examine only the defense asserted before us, see Oneok, Inc. v. Learjet, Inc., — U.S.-, 135 S.Ct. 1591, 1595, 1602, 191 L.Ed.2d 511 (2015). Defendants argue that IPPs’ state law claims are subject to conflict preemption. There are two types of conflict preemption: (1) where “compliance with both federal and state duties is simply impossible,” and (2) where “compliance with both laws is possible, yet state law poses an obstacle to the full achievement of federal purposes.” MD Mall Assocs. v. CSX Transp., Inc., 715 F.3d 479, 495 (3d Cir. 2013). Defendants rely on “obstacle” conflict preemption. Thus, we will examine whether IPPs’ state law claims pose an obstacle to achieving Congress’s goals under the Shipping Act.

B

1

We recognize that “all preemption cases ‘start with the assumption that the historic police powers of the States were not to be superseded by [a] [f]ederal [a]ct unless that was the clear and manifest purpose of Congress.’ ” Sikkelee v. Precision Airmotive Corp., 822 F.3d 680, 687 (3d Cir. 2016) (quoting Wyeth v. Levine, 555 U.S. 555, 565, 129 S.Ct. 1187, 173 L.Ed.2d 51 (2009)), cert, denied sub nom. AVCO Corp. v. Sikkelee, — U.S. -, 137 S.Ct. 495, 196 L.Ed.2d 433 (2016). From this assumption, we presume claims based on laws embodying state police powers are not preempted. This “presumption against preemption,” however, does not apply here because our case concerns the regulation of international maritime commerce, an area uniquely in the federal domain. United States v. Locke, 529 U.S. 89, 108, 120 S.Ct. 1135, 146 L.Ed.2d 69 (2000) (“The state laws now in question bear upon national and international maritime commerce, and in this area there is no beginning assumption that concurrent regulation by the State is a valid exercise of its police powers.”); see also Farina v. Nokia Inc., 625 F.3d 97, 116 (3d Cir. 2010) (“The presumption applies with particular force in fields within the police powers of the state, but does not apply where state regulation has traditionally been absent.” (citation omitted)).

2

As there is no presumption against preemption in this case dealing with maritime conduct, we will determine whether the Shipping Act preempts IPPs’ state law claims. This requires us to consider Congress’s intent. Mabey Bridge & Shore, Inc. v. Schoch, 666 F.3d 862, 868 (3d Cir. 2012); see also Wyeth, 555 U.S. at 565, 129 S.Ct. 1187. To do so, we consider the language, structure, and purpose of the statute, as well as legislative history where appropriate. See Sikkelee, 822 F.3d at 687; Bruesewitz v. Wyeth, Inc., 561 F.3d 233, 243-44 (3d Cir. 2009).

As noted previously, one purpose of the Act is to “establish a nondiseriminatory regulatory process for the common carriage of goods by water in the foreign commerce of the United States with a minimum of government intervention and regulatory costs.” 46 U.S.C. § 40101(1). A second purpose is to ensure that U.S.-flag ships are on a level playing field with foreign vessels. See, e.g., id. § 40101(2) (stating that a purpose of the Act is to provide an efficient system of ocean transportation that is “in harmony with, and responsive to, international shipping practices”).

To those ends, the Act granted ocean common carriers certain antitrust immunities. Section 40307(a) expressly immunizes agreements filed with the FMC from the federal criminal and civil antitrust laws, and § 40307(d) bars recovery of damages and injunctions under the Clayton Act for conduct prohibited by the Act. Through these provisions, Congress sought to limit the application of the antitrust laws to epable U.S.-flag carriers to compete against their foreign counterparts who may not be subject to similar restrictions. See H.R. Rep. No. 98-53(1), at 9, 10 (noting “[t]he perception ... that the threat of U.S. antitrust prosecution weighs much more heavily on U.S. operators than their foreign-flag competition” and recognizing a “need to foster a regulatory environment in which U.S.-flag finer operators are not placed at a competitive disadvantage vis-a-vis their foreign-flag competitors”); S. Rep. No. 98-3, at 7 (noting trading partners’ “blocking statutes” and stating that “[c]lear antitrust immunity ... marks a major step in revitalizing our maritime industry because it removes a major handicap created by uneven enforcement”); see also S. Rep. No. 98-3, at 1 (recommending the bill “in order to ... harmonize U.S. shipping practices with those of our major trading partners, especially by reaffirming antitrust immunity for certain carrier and conference activities”). To allow state antitrust claims to proceed would interfere with this goal. See Am. Ass’n of Cruise Passengers, Inc. v. Carnival Cruise Lines, Inc., 911 F.2d 786, 792 (D.C. Cir. 1990) (“Congress was concerned about a carrier being subject to ‘parallel jurisdiction,’ i.e., remedies and sanctions for the same conduct made unlawful by both the Shipping Act and the antitrust laws.” (emphasis and citation omitted)); H.R. Rep. No. 98-53(1), at 12 (reflecting Congress’s intent “that violations of this Act not result in the creation of parallel jurisdiction over persons or matters which are subject to the Shipping Act”). Put simply, to subject the carriers to potential state antitrust liability would essentially undo Congress’s work in expanding antitrust immunity and undermine its efforts to assist U.S.-flag ships avoid a competitive disadvantage. See H.R. Rep. No. 98-53(1), at 25 (noting that the Act would meet the objective to keep ocean liners “free of ... threatened penalties under changing interpretations of the antitrust laws”). Thus, we hold that the Shipping Act preempts IPPs’ state law antitrust claims.

IPPs’ consumer protection and unjust enrichment claims are also preempted. While these state laws reflect the exercise of traditional police powers, applying them here would allow the States to impose rules in an area Congress has historically regulated: maritime commerce. Locke, 529 U.S. at 108, 120 S.Ct. 1135. It would also thwart Congress’s goal of ensuring uniform regulation of ocean common carriers’ business practices. See 46 U.S.C. § 40101(1)-(2); Report of the Senate Committee on Commerce, Science, and Transportation, S. Rep. No. 98-3, 98th Cong., 1st Sess. at 1 (supporting the bill to end, among other things, “the uncertainty and delay that surrounds U.S. Government regulation of ocean liner shipping, by providing a predictable legal regime and streamlined regulatory process administered and enforced by a single independent Federal agency (the [FMC])”).

To achieve these goals, Congress prohibited certain activities. Among other things, the Shipping Act makes certain unfair devices unlawful, such as operating under unfiled and ineffective agreements on specific matters, id. § 41102(b), failing to establish just and reasonable regulations and practices regarding receiving, handling, storing, or delivering property, id. § 41102(c), unreasonably refusing to deal or negotiate, id. §§ 41104(10), 41105, and allocating shippers in an unauthorized manner among specific carriers who were parties to an agreement, id. § 41105.

In addition to prohibiting such acts, Congress created specific enforcement mechanisms for persons and entities injured by these illegal practices. It empowered the FMC to investigate and punish illegal conduct pursuant to a uniform regime. By granting the FMC this authority, Congress has put in place a regulator familiar with complex foreign commerce issues confronting ocean common carriers. This expertise enables the FMC to make informed decisions about whether conduct violates the Act and warrants punishment. See Farina, 625 F.3d at 126; 46 U.S.C. §§ 41109, 41305.

Moreover, Congress provided a means for private parties injured by the illegal acts of such carriers to seek relief ranging from double damages and attorneys’ fees to injunctions. Allowing state laws to impose different standards would upset this carefully crafted scheme. See Farina, 625 F.3d at 123 (“Allowing state law to impose a different standard permits a re-balancing of those considerations.”); cf. Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341, 348, 121 S.Ct. 1012, 148 L.Ed.2d 854 (2001) (“The balance sought by the Administration can be skewed by allowing fraud-on-the-FDA claims under state tort law”). Further, allowing juries to decide liability, as IPPs seek, would conflict with the scheme that vests the FMC with decision-making power. See Farina, 625 F.3d at 125 (“Allowing juries to impose liability on cell phone companies for claims like Farina’s would conflict with the FCC’s regulations.”). For these reasons, permitting IPPs to pursue their state law claims that Defendants allegedly had secret agreements to coordinate price increases, not to compete, and to restrict capacity would interfere with Congress’s goal of uniform regulation of common carriers’ international maritime activity. See 46 U.S.C. § 40101(1X2).

Accordingly, we hold that the Shipping Act preempts IPPs’ state law consumer protection and unjust enrichment claims because allowing them to proceed would pose an obstacle to achieving Congress’s objectives in passing the Act.

V

IPPs’ challenge to the District Court’s order denying their request that it reconsider the dismissal order also fails. A judgment may be altered under Rule 59(e) if the party seeking reconsideration shows at least one of the following: “(1) an intervening change in the controlling law; (2) the availability of new evidence that was not available when the court granted the motion ...; or (3) the need to correct a clear error of law or fact or to prevent manifest injustice.” Howard Hess Dental Labs. Inc. v. Dentsply Int’l, Inc., 602 F.3d 237, 251 (3d Cir. 2010) (citation and internal quotation marks omitted). Similarly, Rule 60(b) provides, in relevant part, relief from a judgment for: (1) “mistake, inadvertence, surprise, or excusable neglect,” Fed. R. Civ. P. 60(b)(1); (2) a “judgment [that] is void,” Fed. R. Civ. P. 60(b)(4); or (3) “any other reason that justifies relief,” Fed. R. Civ. P. 60(b)(6).

IPPs asked the District Court to reconsider its dismissal order and “retain jurisdiction over claims asserted against K Line and MOL [Defendants] for the limited purpose” of approving class action settlements. Joint App. 60, However, IPPs did not submit a motion for preliminary and final approval of any settlement or a motion to stay the matter before the District Court dismissed Plaintiffs’ claims. Furthermore, IPPs did not identify an intervening change in the controlling law, present new evidence, allege that the District Court’s opinion was the result of a clear error of fact or law, or point to any extraordinary circumstance that would warrant granting relief. Because IPPs failed to meet any of the grounds for reconsideration, the District Court did not abuse its discretion in denying their motions for reconsideration.

VI

For the foregoing reasons, we will affirm.

      . The plaintiffs fall into two categories: Direct Purchase Plaintiffs ("DPPs”) and Indirect Purchase Plaintiffs ("IPPs”). The latter category consists of Auto Dealer IPPs, End-Payor IPPs, and Truck Center IPPs.

      . Because this appeal arises from an order dismissing the complaints pursuant to Fed. R. Civ. P. 12(b)(6), the facts are derived from the complaints and are accepted as true, Connelly v. Lane Constr. Corp., 809 F.3d 780, 786 (3d Cir. 2016).

      . While IPPs’ motion for reconsideration was pending, Plaintiffs filed complaints with the FMC.

      . The District Court had jurisdiction pursuant to 28 U.S.C, §§ 1331 and 1337, and we have jurisdiction pursuant to 28 U.S.C. § 1291. We exercise plenary review of a district’ court's order granting a motion to dismiss under Rule 12(b)(6), Burtch v. Milberg Factors, Inc., 662 F.3d 212, 220 (3d Cir. 2011), and apply the same standard as the District Court. See Santomenno ex rel. John Hancock Tr. v. John Hancock Life Ins. Co., 768 F.3d 284, 290 (3d Cir. 2014). Under this standard, we must determine whether the complaints “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, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)), “but we disregard rote recitals of the elements of a cause of action, legal conclusions, and mere conclusory statements.” James v. City of Wilkes-Barre, 700 F.3d 675, 679 (3d Cir. 2012). Our review of the District Court’s order denying IPPs’ motion to reconsider is “plenary where the denial was based on the ‘interpretation and application of a legal precept.’ Otherwise, we review such denials for abuse of discretion.” United States v. Smith, 445 F.3d 713, 716 (3d Cir. 2006) (citations omitted).

      . Under the Shipping Act, the "term ‘ocean common carrier’ means a vessel-operating common carrier,” 46 U.S.C. § 40.102, Under the Act, a
      "common carrier”—(A) means a person that—(i) holds itself out to the general public to provide transportation by water of passengers or cargo between the United States and a foreign country for compfensation; (ii) assumes responsibility for the transportation from the port or point of receipt to the port or point of destination; and (iii) uses, for all or part of that transportation, a vessel operating on the high seas or the Great Lakes between a port in the United States and a port in a foreign country; but (B) does not include a carrier engaged in ocean transportation by ferry boat, ocean tramp, or chemical parcel-tanker, or by vessel when primarily engaged in the carriage of perishable agricultural commodities—(i) if the carrier and the owner of those commodities are wholly-owned, directly or indirectly, by a person primarily engaged in the marketing and distribution of those commodities; and (ii) only with respect to the carriage of those commodities.
      Id.

      . The Shipping Act of 1916, 46 U.S.C. § 801 et seq., provided antitrust immunity for rate-making agreements approved by the FMC. See, e,g., Carnation Co. v. Pac. Westbound Conf., 383 U.S. 213, 216-18 & n.1, 86 S.Ct. 781, 15 L.Ed.2d 709 (1966) (noting that the Shipping Act of 1916 included only a limited antitrust exemption and holding that the implementation of rate-making agreements not approved by the FMC was subject to the antitrust laws); Nat'l Ass'n of Recycling Indus., Inc. v. Am. Mail Line, Ltd., 720 F.2d 618, 618 (9th Cir. 1983) (stating that the Shipping Act of 1916 immunized collective rate-making activity provided that the rate-making was authorized by agreements which the FMC approved and all rates were filed with the FMC).

      . H.R. Rep. No. 98-53 relates to the proposed Shipping Act of 1983, S. 504, H.R. 1878, 98th Cong., 1st Sess., which was not passed but was considered by the same Congress that passed the Shipping Act of 1984. The proposed Shipping Act of 1983 is the same in all relevant respects as the Shipping Act of 1984.

      . 46 U.S.C. § 40302 provides that a "true copy of every agreement referred to in section 40301(1) or (b) of this title shall be filed with the [FMC], If the agreement is oral, a complete memorandum specifying in detail the substance of the agreement shall be filed.”

      . Under the Shipping Act, an agreement is effective:
      (1) on the 45th day after filing, or on the 30th day after notice of the filing is published in the Federal Register, whichever is later; or
      (2) if additional information or documents are requested under subsection (d)—(A) on the 45th day after the Commission receives all the additional information and documents; or (B) if the request is not fully complied with, on the 45th day after the Commission receives the information and documents submitted and a statement of the reasons for noncompliance with the request.
      46 U.S.C. § 40304.

      . After filing a complaint, a private party may also file a complaint in a district court for injunctive relief, id. § 41306, and seek enforcement of FMC orders in a district court, id. § 41309.

      . Like H. Rep. 98-53 discussed above, supra note 7, S. Rep. No. 98-3 relates to the proposed but not passed Shipping Act of 1983, which is the same as the Shipping Act of 1984 in all relevant respects.

      . Plaintiffs alternatively argue that the complaints should not be dismissed with respect to contracts for the shipping of "new[ly] assembled motor vehicles.” 46 U.S.C. § 40502. They raised this argument for the first time during oral argument before the District Court, and when the District Court confronted them with the fact that this was a new argument, they agreed not to "make those arguments.” Defs. App. 141. Despite this statement, Plaintiffs argue that they did not waive the argument because it is currently pending before the District Court in a different case. Raising the argument in another case does not cure their failure to raise the argument here, and this failure waives the argument. Brenner v. Local 514, United Bhd. of Carpenters & Joiners of Am., 927 F.2d 1283, 1298 (3d Cir. 1991). Even if the argument were not waived, it would not change the outcome, Section 40502 provides that the requirement to file a service contract with the FMC does not apply to contracts regarding "new[ly] assembled motor vehicles.” 46 U.S.C. § 40502(b) ("Each service contract entered into under this section by an individual ocean common carrier or an agreement shall be filed confidentially with the Federal Maritime Commission..., [This provision] does not apply to contracts regarding ... new assembled motor vehicles."). This exemption from filing service contracts for newly assembled motor vehicles, however, does not relieve Defendants from their obligation to file the other agreements referred to in § 40301(a) or (b) with the FMC.

      . Although the Shipping Act contains no express preemption clause or savings clause, that does not " ‘bar[ ] the ordinary working of conflict pre-emption principles.’ ” Buckman Co. v. Plaintiffs' Legal Comm., 531 U.S. 341, 352, 121 S.Ct. 1012, 148 L.Ed.2d 854 (2001) (quoting Geier v. Am. Honda Motor Co., 529 U.S. 861, 869, 120 S.Ct. 1913, 146 L.Ed.2d 914 (2000)).

      . This assumption is invoked "because respect for the States as ‘independent sovereigns in our federal system’ leads us to assume that ‘Congress does not cavalierly preempt state-law causes of action.’ ” Wyeth, 555 U.S. at 565 n.3, 129 S.Ct. 1187 (quoting Medtronic, Inc. v. Lohr, 518 U.S. 470, 485, 116 S.Ct. 2240, 135 L.Ed.2d 700 (1996)).

      .Even if the presumption did apply, the text, purposes, scheme, and legislative history of the Shipping Act embody a ‘‘clear and manifest” congressional intention to preempt the state laws in question. See Farina, 625 F.3d at 117 (citation omitted).

      . This is not to say that all conduct in which ocean common carriers engage is never subject to state law. See, e.g., Pasha Auto Warehousing, Inc. v. Phila. Reg'l Port Auth., No. CIV. A. 96-6779, 1998 WL 188848, at *6-9 (E.D. Pa. Apr. 21, 1998) (concluding that the FMC did not have exclusive or primary jurisdiction over declaratory relief action concerning lease agreements).

      . At least where the subject matter is technical and the history and background are complex and extensive, we give some deference to an agency's explanation of how state law affects the federal scheme. See Farina, 625 F.3d at 126-27. The weight accorded to “the agency’s explanation of state law’s impact on the federal scheme depends on its thoroughness, consistency, and pervasiveness.” Wyeth, 555 U.S. at 577, 129 S.Ct. 1187 (citing United States v. Mead Corp., 533 U.S. 218, 234-35, 121 S.Ct. 2164, 150 L.Ed.2d 292 (2001), and Skidmore v. Swift & Co., 323 U.S. 134, 140, 65 S.Ct. 161, 89 L.Ed. 124 (1944)). Here, the FMC and United States, as amici, assert that IPPs’ state law antitrust claims are not preempted (but appear to take no position with respect to IPPs’ other state law claims). We decline to defer to their views on preemption in this case. First, they discuss field preemption but, as stated above, that is not the preemption defense asserted before us. Second, to the extent amici seek to draw a distinction between filed and unfiled agreements, we need not address that distinction because only unfiled agreements are at issue here. Finally, the FMC’s and United States’ position on conflict preemption is not "persuasive[].” See Wyeth, 555 U.S. at 577, 129 S.Ct. 1187. We recognize, as they assert, that the Shipping Act and its legislative history are silent regarding state law claims. However, the position that the Shipping Act contemplates state law antitrust enforcement is inconsistent with the conclusion that the Shipping Act bars Clayton Act claims (with which amici agree); it also overlooks the purposes of the Act as set forth in the statute and legislative history as well as the comprehensive scheme for enforcement of Shipping Act violations before the FMC.

      . We have observed that situations in which the federal government "is required to strike a balance between competing statutory objectives lend themselves to a finding of conflict preemption." Farina, 625 F.3d at 123; see also Buckman, 531 U.S. at 348, 121 S.Ct. 1012 ("The conflict stems from the fact that the federal statutory scheme amply empowers the FDA to punish and deter fraud against the [FDA], and that this authority is used by the [FDA] to achieve a somewhat delicate balance of statutory objectives. The balance sought by the [FDA] can be skewed by allowing fraud-on-the-FDA claims under state tort law.”); City of Burbank v. Lockheed Air Terminal Inc., 411 U.S. 624, 638-39, 93 S.Ct. 1854, 36 L.Ed.2d 547 (1973) ("The Federal Aviation Act requires a delicate balance between safety and efficiency, and the protection of persons on the ground.... The interdependence of these factors requires a uniform and exclusive system of federal regulation if the congressional objectives underlying the Federal Aviation Act are to be fulfilled.” (citation omitted)). This case presents such a situation.

      . IPPs argue that the District Court “erred in concluding that it lacked subject matter jurisdiction to effectuate settlements with the two largest defendants.” IPP Appellants' Br. 44. The Court did not deny IPPs’ motions for reconsideration on the basis of a lack of subject matter jurisdiction. Indeed, it was aware that it possessed subject matter jurisdiction, over the dispute and exercised its discretion not to entertain the request to approve the settlements because it had determined that the FMC provided a forum to resolve Plaintiffs’ dispute.


source: Caselaw Access Project

author: LEE, District Judge:

license: Public Domain

text:
    IN RE: Gregory BIRMINGHAM, Debtor. Gregory Birmingham, Plaintiff-Appellant, v. PNC Bank, N.A., Defendant-Appellee.
    No. 15-1800
    United States Court of Appeals, Fourth Circuit.
    Argued: October 26, 2016
    Decided: January 18, 2017
    Amended: January 20, 2017

      ARGUED: John Douglas Burns, The Burns Law Firm, LLC, Greenbelt, Maryland, for Appellant. Daniel J. Tobin, Ballard Spahr LLP, Washington, D.C., for Appellee. ON BRIEF: Bryan J. Harrison, Matthew G. Summers, Ballard Spahr LLP, Baltimore, Maryland, for Appellee.
    Before THACKER and HARRIS, Circuit Judges, and Gerald Bruce LEE, United States District Judge for the Eastern District of Virginia, sitting by designation.
   Affirmed by published opinion. Judge LEE wrote the opinion, in which Judge HARRIS and Judge THACKER joined.

LEE, District Judge:

The anti-modification clause in 11 U.S.C. § 1322(b)(2) of the Bankruptcy Code protects a mortgagee from having its claim in a Chapter 13 bankruptcy proceeding modified, if the mortgage is secured “only by a security interest in real property that is the debtor’s principal residence.” 11 U.S.C, § 1322(b)(2). The issue in this appeal is whether reference in the Deed of Trust to escrow funds, insurance proceeds, or miscellaneous proceeds constitute additional collateral or incidental property for purposes of § 1322(b)(2). We hold that these items constitute incidental property, which entitles Appellee to anti-modification protection under § 1322(b)(2). The district court’s determination is therefore affirmed.

I.

On May 23, 2014, Appellant Gregory John Birmingham (“Birmingham”) filed a voluntary petition for Chapter 13 bankruptcy. J.A. 342-45. One of the claims against Birmingham is a mortgage in the amount of $343,101.87 held by Appellee PNC Bank, N.A. (“PNC”), and secured by a deed of trust (“Deed of Trust”) on Birmingham’s primary residence at 11721 Chilcoate Lane, Beltsville, Maryland 20705 (“Property”). J.A. 329. According to the District of Maryland Claims Register, there is an arrearage on the mortgage of $93,386.58 as of June 23, 2015. J.A. 329.

Birmingham filed his Original Chapter 13 Bankruptcy Plan on June 4, 2014. J.A. 378. At that point in time, the Property was valued at only $206,400. J.A. 362. The Bankruptcy Plan included a cram-down of PNC’s interest in the Property. J.A. 385-86. After a series of objections and amendments to the Bankruptcy Plan, Birmingham filed a Complaint for Declaratory Action pursuant to 28 U.S.C. §§ 2201-2202; 11 U.S.C. §§ 105(a), 506(a), 2201 (11721 Chilcoate Ln Beltsville, MD 20705). J.A. 378^00. Birmingham’s Complaint requested a declaration that that PNC’s claim be treated as a partially unsecured claim subject to modification. J.A. 399-400.

Birmingham argued that certain provisions of the Deed of Trust required collateral other than real property, which would remove the claim from 11 U.S.C. § 1322(b)(2)’s anti-modification protection. J.A. 397-99. Birmingham cited three specific provisions of the Deed of Trust, involving escrow items (Section Three), property insurance proceeds (Section Five), and miscellaneous proceeds (Section Eleven). J.A. 398. PNC filed a Motion to Dismiss the Adversary Complaint and an laccompanying memorandum, contending that the items referred to in the Deed of Trust provisions cited by Birmingham constituted “incidental property,” which is part of a debtor’s principal residence. J.A. 674. Consequently, PNC argued that the additional items would not expose the PNC mortgage to a cram-down. J.A. 674. After Birmingham filed a response to the motion to dismiss, Bankruptcy Judge Wendelin I. Lipp granted the motion, noting that “the issues raised by [Birmingham] were identical to arguments that repeatedly have been denied by the Bankruptcy Court for this District.” J.A. 674.

Birmingham then appealed the Bankruptcy Court’s decision to the United States District Court for the District of Maryland. J.A. 405. Birmingham raised the same arguments on appeal, namely that the inclusion of miscellaneous proceeds, escrow funds, and insurance proceeds in the Deed of Trust constitute a waiver of the anti-modification provision of 11 U.S.C. § 1322(b)(2). J.A. 422. The district court affirmed the bankruptcy court’s decision, holding that the miscellaneous proceeds, escrow funds, and insurance proceeds provisions describe “benefits which are merely incidental to an interest in real property” and generally are not “additional security for purposes of § 1322(b)(2).” J.A. 679. The district court further noted that the items at issue do not “have any value of their own separate and apart from the Property and the [PNC Deed of Trust]; to the contrary, they all exist only to give effect to the PNC’s security interest, which otherwise could be frustrated by a superior lien or by destruction or condemnation of the Property.” J.A. 681.

Birmingham filed a timely appeal before this circuit. J.A, 685-88. This case was consolidated with a nearly identical case that similarly originated in the District Court of Maryland, Akwa v. Residential Credit Solutions, Inc., 530 B.R. 309 (D. Md. 2015). The Akwa appeal was dismissed on February 16, 2016. ECF No. 69-2. Accordingly, only the Birmingham appeal is currently before the Court.

II.

This dispute requires us to determine whether the district court properly concluded that the bankruptcy court did not err in dismissing the adversary proceedings against PNC. Specifically, we are to analyze whether the district court correctly affirmed the bankruptcy court’s finding that PNC is entitled to the anti-modification protections of 11 U.S.C. § 1322 (b)(2).

Because the district court sits as an appellate tribunal in bankruptcy, our review of the district court’s decision is plenary. Bowers v. Atlanta Motors Speedway (In re Se. Hotel Properties Ltd. P’ship), 99 F.3d 151, 154 (4th Cir. 1996) (citation omitted). “We apply the same standard of review as the district court applied to the bankruptcy court’s decision.” Id. “Findings of fact are reviewed for clear error, and conclusions of law are reviewed de novo.” Id. (citation omitted).

A.

The bankruptcy court granted PNC’s motion to dismiss Birmingham’s complaint under Federal Rule of Civil Procedure 12(b)(6). J.A. 675. The district court applied this same standard of review to the bankruptcy court’s decision. Id.

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the legal sufficiency of the complaint. Parpasan v. Attain, 478 U.S. 265, 283, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986). The motion should be granted unless the complaint “states a plausible claim for relief.” Walters v. McMahen, 684 F.3d 435, 439 (4th Cir. 2012) (citing Ashcroft v. Iqbal, 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)). In considering a Rule 12(b)(6) motion, the Court “must accept as true all of the factual allegations contained in the complaint,” drawing “all reasonable inferences” in the non-moving party’s favor. E.I. du Pont de Nemours and Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011) (citations omitted). The court is not obligated to assume the veracity of the legal- conclusions drawn from the facts alleged. Adcock v. Freightliner LLC, 550 F.3d 369, 374 (4th Cir. 2008) (citing Dist. 28, United Mine Workers of Am., Inc. v. Wellmore Coal Corp., 609 F.2d 1083, 1085-86 (4th Cir. 1979)).

The complaint must contain sufficient factual allegations, taken as true, “to raise a right to relief above the speculative level” and “nudge [the] claims across the line from conceivable to plausible.” Vitol, S.A. v. Primerose Shipping Co., 708 F.3d 527, 543 (4th Cir. 2013) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). The facial plausibility standard requires pleading of “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Clatterbuck v. City of Charlottesville, 708 F.3d 549, 554 (4th Cir. 2013) (quoting Iqbal, 556 U.S. at 678, 129 S.Ct. 1937). The plausibility requirement imposes not a probability requirement but rather a mandate that a plaintiff “demonstrate more than a ‘sheer possibility that a defendant has acted unlawfully.’” Francis v. Giacomelli, 588 F.3d 186, 193 (4th Cir. 2009) (quoting Iqbal , 556 U.S. at 678, 129 S.Ct. 1937). Accordingly, a complaint is insufficient if it relies upon “naked assertions” and “unadorned conclusory allegations” devoid of “factual enhancement.” Id. (citations omitted). The complaint must present “ ‘enough facts to raise a reasonable expectation that discovery will reveal evidence’ of the alleged activity.” US Airline Pilots Ass’n v. Awappa, LLC, 615 F.3d 312, 317 (4th Cir. 2010) (quoting Twombly, 550 U.S. at 556, 127 S.Ct. 1955).

In addition to the complaint, the court will also examine “documents incorporated into the complaint by reference,” as well as those matters properly subject to judicial notice. Clatterbuck, 708 F.3d at 557 (citations omitted); see also Matrix Capital Mgmt. Fund, LP v. BearingPoint, Inc., 576 F.3d 172, 176 (4th Cir. 2009) (quoting Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322, 127 S.Ct. 2499, 168 L.Ed.2d 179 (2007)).

B.

Certain provisions of the Bankruptcy Code are relevant to this appeal. “Under Chapter 13 of the Bankruptcy Code, individual debtors may obtain adjustment of their indebtedness through a flexible repayment plan approved by a bankruptcy court.” Nobelman v. Am. Sav. Bank, 508 U.S. 324, 327, 113 S.Ct. 2106, 124 L.Ed.2d 228 (1993). The relationship between 11 U.S.C. § 506(a) and § 1322(b)(2) is pertinent to this circuit’s review of the district court’s decision to affirm the bankruptcy court’s dismissal of Birmingham’s complaint. Section 506(a) is used in conjunction with § 1322 to allow modification, or bifurcation, of a secured creditor’s claim into secured and unsecured portions when the claim exceeds the value of the secured property. Nobelman, 508 U.S. at 328, 113 S.Ct. 2106.

In Nobelman, the Supreme Court examined the nexus between claim-bifurcation under § 506(a) and the anti-modification provision of § 1322(b)(2) to ascertain whether a debtor could bifurcate a single, under-secured residential mortgage claim into secured and unsecured components pursuant to § 506(a). Id. at 326, 113 S.Ct. 2106. The debtor in Nobelman argued that § 1322(b)(2)’s anti-modification provision applied only to the secured component of her mortgage claim, as defined in § 506(a). Id.

Section 506(a) states that:

(a)(1) An allowed claim of creditor secured by a lien on property in which the estate has an interest ... is a secured claim to the extent of the value of such creditor’s interest in the estate’s interest in such property ... and is an unsecured claim to the extent that the value of such creditor’s interest is less than the amount of such allowed claim. Such value shall be determined in light of the purpose of the valuation and of the proposed disposition or use of such property, and in conjunction with any hearing on such disposition or use or on a plan affecting such creditor’s interest.

11 U.S.C. § 506(a). Accordingly, under § 506(a), “an allowed claim secured by a lien on the debtor’s property is a secured claim to the extent of the value of the property; to the extent the claim exceeds the value of the property, it is an unsecured claim.” Nobelman, 508 U.S. at 328, 113 S.Ct. 2106 (internal quotation marks omitted).

Notwithstanding, § 1322(b)(2) provides:

(b) Subject to subsections (a) and (c) of this section, the plan may—
Modify the rights of holders of secured claims, other than a claim secured only by a security interest in real property that is the debtor’s principal residence ....

11 U.S.C. § 1322(b)(2). This “anti-modification” provision precludes reduction or cramming down the value of a claim secured by an interest in real property that is the debtor’s principal residence. In other words, a claimant’s interest in real property that is secured solely by the debtor’s principal residence may not be bifurcated.

C.

Congress clarified the meaning of a key term in the anti-modification clause, “debt- or’s principal residence,” in the Bankruptcy Abuse Prevention and Consumer Protection Act (“BAPCP Act”) of 2005. The Bankruptcy Code now defines the term as “a residential structure if used as the principal residence by the debtor, including incidental property, without regard to whether that structure is attached to real property.” 11 U.S.C. § 101(13A)(A) (emphasis added). The BAPCP Act also defined “incidental property,” as it relates to a debtor’s principal residence, as follows:

(A) property commonly conveyed with a principal residence in the area where the real property is located;
(B) all easements, rights, appurtenances, fixtures, rents, royalties, mineral rights, oil or gas rights or profits, water rights, escrow funds, or insurance proceeds;
(C) all replacements or additions.

11 U.S.C. § 101(27B). The Code defines a security interest as a “lien created by an agreement.” 11 U.S.C. § 101(51). Moreover, a lien is defined as a “charge against or interest in property to secure a payment of a debt or performance of an obligation.” 11 U.S.C. § 101(37).

With this framework in mind, and for the reasons that follow, we hold that the district court’s decision to affirm the bankruptcy court’s dismissal of Birmingham’s complaint was correct. PNC’s loan was secured solely by Birrhingham’s principal residence and not any additional collateral. The Bankruptcy Code’s anti-modification provision precluded the bifurcation sought by Birmingham. Consequently, Birmingham’s complaint was appropriately dismissed.

III.

The Birmingham Deed of Trust not only grants PNC a security interest in the Property, but also provides additional protections for PNC. However, saliently, the auxiliary protections are not additional collateral and do not remove PNC’s claim from the protection of § 1322(b)(2).

A.

Of particular importance to this Court’s analysis are Sections 3, 5, and 11 of the Deed of Trust, all of which will be analyzed in turn. Section 3 of the Deed of Trust pertains to escrow funds and states, in pertinent part, the following:

Funds for Escrow Items. Borrower shall pay to Lender on the day Periodic Payments are due under the Note, until the Note is paid in full, a sum (the “Funds”) to provide for payment of amounts due for: (a) taxes and assessments and other items which can attain priority over this Security Instrument as a lien or encumbrance on the Property; (b) leasehold payments or ground rents on the Property, if any; (c) premiums for any and all insurance required by Lender under Section 5; and (d) Mortgage Insurance Premiums, if any, or any sums payable by Borrower to Lender in lieu of the payment of the Mortgage Insurance premiums in accordance with the provisions of Section 10. These items are called “Escrow Items.”
If there is a surplus of Funds held in escrow, as defined under [the Real Estate Settlement Procedures Act (“RES-PA”) ], Lender shall account to Borrower for the excess funds in accordance with RESPA. If there is shortage of funds held in escrow, as defined under RESPA, Lender shall notify Borrower as requested by RESPA, and Borrower shall pay to Lender the amount necessary to make up the shortage in accordance with RESPA, but in no more than 12 monthly payments.

Deed of Trust § 3, J.A. 621-22.

Section 5 of the Deed of Trust addresses the topic of property insurance, and provides as follows:

Borrower shall keep the improvements now existing or hereafter erected on the Property insured against loss by fire, hazards included within the term “Extended coverage,” and any other hazards including, but not limited to, earthquakes and floods, for which Lender requires insurance....
If Borrower fails to maintain any of the coverage described above, Lender may obtain insurance coverage, at Lender’s option and Borrower’s expense. Lender is under no obligation to purchase any particular type or amount of coverage. Therefore, such coverage shall cover Lender, but might or might not protect Borrower, Borrower’s equity in the Property, or the contents of the Property, against any risk, hazard or liability and might provide greater or lesser coverage than was previously in effect.
Borrower hereby assigns to Lender (a) Borrower’s rights to any insurance proceeds in an amount not to exceed the amounts unpaid under the Note or this Security Instrument, and (b) any other of Borrower’s rights (other than the right to any refund of unearned premiums paid by Borrower) under all insurance policies covering the Property, insofar as such rights are applicable to the coverage of the Property. Lender may use the insurance proceeds either to repair or restore the Property or to pay amounts unpaid under the Note or this Security Instrument, whether -or not then due.

Deed of Trust § 5, J.A. 623-24.

Lastly, Section 11 of the Deed of Trust discusses miscellaneous proceeds and contains the following language:

Assignment of Miscellaneous Proceeds; Forfeiture. All Miscellaneous Proceeds are hereby assigned to and shall be paid to Lender.
In the event of a partial taking, destruction, or loss in value of the Property in which the fair market value of the Property immediately before the partial taking, destruction, or loss in value is less than the amount of the sums secured immediately before the partial taking, destruction, or loss in value, unless the Borrower and Lender otherwise agree in writing, the Miscellaneous Proceeds shall be applied to the sums secured by this Securing Instrument whether or not the sums are then due.

Deed of Trust § 11, J.A. 626.

Miscellaneous Proceeds include:

[A]ny compensation, settlement, award of damages, or proceeds paid by any third party (other than insurance proceeds paid under the coverages described in Section 5) for: (i) damage to, or destruction of, the Property; (ii) condemnation or other taking of all or any part of the Property; (iii) conveyance in lieu of condemnation; or (iv) misrepresentations of, or omission as to, the value and/or condition of the Property.

Deed of Trust ¶ M.

The issue presented is whether these provisions of the Deed of Trust constitute sufficient collateral so that PNC’s interest is secured by more than Birmingham’s principal residence. We hold that the aforementioned provisions do not entitle Birmingham to the bifurcation sought.

B.

Birmingham argues that Sections 3, 5, and 11 of the Deed of Trust provide additional security for PNC’s interest such that it is no longer secured solely by an interest in real property. Appellant Br. at 19-25. These items, however, are incidental property frequently conveyed in a deed of trust and defined in 11 U.S.C. §§ 101(27B) and 101(13A)(A) as part of a debtor’s principal residence.

The case Allied Credit Corp. v. Davis (In re Davis), 989 F.2d 208 (6th Cir. 1993) is illustrative. There, the Sixth Circuit found that “[ijtems which are inextricably-bound to the real property itself as part of the possessory bundle of rights” do not extend a lender’s security beyond the real property. Id. at 213; see also Akwa, 530 B.R. at 313 (D. Md. 2015). On the topic of insurance, the Davis court explained that “hazard insurance is merely a contingent interest—an interest that is irrelevant until the occurrence of some triggering event and not an additional security interest for the purposes of § 1322(b)(2).” In re Davis, 989 F.2d at 211 (citation omitted) (emphasis added). This reasoning similarly applies to miscellaneous proceeds and escrow funds that are tied to the real property at issue. See In re Ferandos, 402 F.3d 147, 156 (3d Cir. 2005) (“[FJunds for taxes and insurance, paid over and placed in escrow, exist precisely for the purpose of paying said taxes and insurance—a cost incurred by the debtor in connection with the ownership of real property.”); see also Kreitzer v. Household Realty Corp. (In re Kreit-zer), 489 B.R. 698, 703-06 (Bankr. S.D. Ohio 2013) (holding that a security interest which residential mortgage lender took in miscellaneous proceeds was not an additional security interest that the lender possessed other than in the residential mortgage property itself).

The district court in Alava, which involved the same standard Fannie Mae/Freddie Mac deed of trust that is at issue in this appeal, correctly noted:

[Tjhe lender may collect funds for escrow to ensure that all property-related payments, like taxes and ground rents, are paid. Likewise, the Deed of Trust also permits the lender to hold insurance proceeds if an insurer pays for repairs to the house to ensure that the lender’s investment—the real property—is repaired to lender’s satisfaction. The same is true for miscellaneous proceeds paid by a third party, which the lender can use for repairs or restoration.

Alma, 530 B.R. at 313-14.

PNC accurately states that this perspective has been recognized by a number of courts in analogous circumstances. See Abdosh v. Ocwen Loan Servicing (In re Ab-dosh), 513 B.R. 882, 886 (Bankr. D. Md. 2014), aff'd sub nom. Abdosh v. Ocwen Loan Servicing, LLC, No. CIV. PJM 14-2916, 2015 WL 4635103 (D. Md. July 30, 2015) (noting that “[tjhere is no need to revisit in detail this clear legal issue”); In re Kreitzer, 489 B.R. at 703-06 (discussing miscellaneous proceeds); In re Mullins, No. 11-11176C-13G, 2012 WL 2576625, at *2 (Bankr. M.D.N.C. July 3, 2012) (discussing escrow funds); In re Inglis, 481 B.R. 480, 482-83 (Bankr. S.D. Ind. 2012) (“[Ujnder the express terms of these provisions ... a lender does not lose its § 1322(b)(2) protection by taking a security interest in escrow funds as ‘escrow funds’ are part of the ‘incidental property’ which comprise ‘the debtor’s principal residence.’ ”); In re Leiferman, No. BR 10-40718, 2011 WL 166170, at *2 (Bankr. D.S.D. Jan 19, 2011) (analyzing miscellaneous proceeds).

In his opposition, Birmingham cites a series of eases where courts have held that certain additional collateral existed beyond real property. For instance, Birmingham cites the Third Circuit’s decision Hammond v. Commonwealth Mortg. Corp. of Am., 27 F.3d 52 (3d Cir. 1994) for the proposition that “supplemental collateral in a deed of trust will cause a waiver of the anti-modification rights of 11 U.S.C. § 1322(b).” Appellant Br. at 43-44. However, the lien in Hammond explicitly “covered more than the real property.” See Abdosh, 513 B.R. at 886.

The security contrivance in Hammond created “an additional security interest in: any and all appliances, machinery, furniture and equipment (whether fixtures or not) of any nature whatsoever.” Hammond, 27 F.3d at 53-54 (internal quotation marks omitted). Here, the Deed of Trust does not expressly attempt to take a security interest in additional collateral. As the Akwa court concluded, the language found in these provisions “explicitly ties the funds to ensuring that the lender’s collateral—the real property—is preserved.” Akwa, 530 B.R. at 313. Accordingly, Birmingham’s reliance on Hammond is misplaced.

Relatedly, Birmingham’s arguments premised on the holdings of other cases cited in his brief are inapposite for the same reason: the security instruments at issue explicitly granted the debtee an interest secured by more than just real property. For example, In re Ennis—in which we found the anti-modification clause of § 1322(b)(2) inapplicable to a security agreement for personal property, i.e. a mobile home on leased property— provides no guidance for a home mortgage that includes the typical incidental benefits intended to protect the interest in real property. See Ennis v. Green Tree Servicing, LLC (In re Ennis), 558 F.3d 343, 347 (4th Cir. 2009); see also Scarborough v. Chase Manhattan Mortg. Corp. (In re Scarborough), 461 F.3d 406, 412 (3d Cir. 2006) (holding that when a mortgage lender takes an interest in real property that includes income producing property, the lender’s interest is also secured by property that is not the debtor’s principal residence, and its claim may be modified); Lomas Mortg., Inc. v. Louis, 82 F.3d 1, 7 (1st Cir. 1996) (finding that § 1322(b)(2) does not bar modification of a secured claim on a multi-unit property in which one unit is debtor’s principal residence and the security interest extends to other income-producing units); Sapos v. Provident Inst. of Sav. in Town of Boston, 967 F.2d 918, 921 (3d Cir. 1992) (holding that the anti-modification provision is inapplicable where the note was also secured by wall-to-wall carpeting, rents, and profits), overruled on other grounds by Nobelman v. Am. Sav. Bank, 508 U.S. 324, 113 S.Ct. 2106, 124 L.Ed.2d 228 (1993); Wilson v. Commonwealth Mortg. Corp., 895 F.2d 123, 128 (3d Cir. 1990) (finding § 1322(b)(2) not applicable where a mortgage agreement stated that the lender had “a security interest in appliances, machinery, furniture, and equipment”), abrogated on other grounds by Nobelman, 508 U.S. 324, 113 S.Ct. 2106.

Sections 3, 5, and 11 of the Deed of Trust do not create “separate or additional security interests], but [are] merely [] provisions] to protect the lender’s security interest in the real property.” Akwa, 530 B.R. at 314 (quoting In re Kreitzer, 489 B.R. 698, 705-06). Accordingly, the district court properly found, as a matter of law, that escrow funds, insurance proceeds, and miscellaneous proceeds are incidental property that do not constitute separate security interests.

C.

Birmingham additionally relies on a line of cases from North Carolina bankruptcy courts that ostensibly found “where an assignment of alternative collateral exists in a deed of trust other than real property, the lender will be subject to modification of its secured debt.” Appellant Br. at 26 (citing In re Bradsher, 427 B.R. 386 (Bankr. M.D.N.C. 2010); Bradshaw v. Asset Ventures, LLC (In re Bradshaw), Nos. 13-06176-8-RDD, 14-00023-8-RDD, 2014 WL 2532227 (Bankr. E.D.N.C. June 4, 2014); In re Murray, No. 10-10125-8-JRL, 2011 WL 5909638 (Bankr. E.D.N.C. May 31, 2011); In re Martin, 444 B.R. 538 (Bankr. M.D.N.C. 2011); In re Hughes, 333 B.R. 360 (Bankr. M.D.N.C. 2005)). As the district court in this case correctly stated, however, the loan documents in both Bradsher and Hughes “expressly provided that escrow payments constituted additional security for the loan.” J.A. 680 (citing Bradsher, 427 B.R. at 388-89 (“[T]he loan documents purport to provide a security interest for the indebtedness secured by the deed of trust in escrow funds in addition to a security interest in the residential land and housing structure.”); Hughes, 333 B.R. at 363 (noting that the loan documents “require the borrower to pledge the escrow funds as ‘additional security”’)). Hence, the language of the loan documents in both Bradsher and Hughes is unequivocally distinguishable from the language present in the Birmingham Deed of Trust. The holdings of Bradsher and Hughes therefore do not apply to this case.

Moreover, in Mullins, the same judge who presided over Bradsher held that nothing in the deed of trust “suggests that a security interest is also being granted in escrow funds. Nor is there any language in the escrow provisions [ ] purporting to create a security interest in escrow funds to be paid by the [debtors].” In re Mullins, 2012 WL 2576625 at *2. Further, in Bynum v. CitiMortgage, Inc. (In re Bynum), Nos. 12-10660, 12-2031, 2012 WL 2974694 (Bankr. M.D.N.C. July 19, 2012), the bankruptcy judge found that a standard Fannie Mae/Freddie Mac deed of trust “do[es] not contain elements required to create a security interest in Escrow Funds.” Id. at *3.

To the extent that Birmingham also relies upon In re Daniels, No. 15-666-5-SWH, 2015 WL 9283153 (Bankr. E.D.N.C. Dec. 18, 2015), a case that addresses the district court decision that is currently before us, the Court in Daniels stated that “Birmingham involved a deed of trust that did not contain explicit language creating a security interest in escrow funds.” Id. at *3 (citation omitted). Highlighting this difference, the Court in Daniels found that “Birmingham’s rejection of Bradsher and Murray is not instructive.” Id.

In short, the North Carolina bankruptcy courts agree that the anti-modification clause applies to the Fannie Mae/Freddie Mac Deed of Trust before us in this case. We thus have no occasion to consider the effect—if any—of additional language in a deed purporting to create a separate security interest in escrow funds, insurance proceeds, or miscellaneous proceeds, in light of our interpretation of § 1322(b)(2),

D.

Birmingham also argues that both the bankruptcy court and the district court should have looked to Maryland law to determine whether the Deed of Trust created additional security interests in escrow funds, insurance proceeds, and miscellaneous proceeds as “real property.” Appellant Br. at 21-24, The Bankruptcy Code, however, explicitly defines “incidental property” to a debtor’s principal residence, which includes both escrow funds and insurance proceeds. 11 U.S.C. § 101(27B). State laws are suspended if they conflict with the Bankruptcy laws. Butner v. U.S., 440 U.S. 48, 54 n.9, 99 S.Ct. 914, 59 L.Ed.2d 136 (1979). Thus, it is not necessary for us to examine Maryland law on this issue.

Even if Maryland law were to apply, it is far from clear that the resulting holding would be favorable for Birmingham. A security interest is created, under Maryland law, when there is language present in the security instrument that leads to the logical conclusion that it was the intention of the parties to create a security interest. Tilghman Hardware, Inc. v. Larrimore, 331 Md. 390, 628 A.2d 215, 220 (1993) (citation omitted). We have already found that the Deed of Trust did not contain language wherein a security interest was granted in escrow funds, insurance proceeds, or miscellaneous proceeds. Therefore, Birmingham’s argument with respect to the application of Maryland law is unavailing.

Finally, the policy arguments that Birmingham puts forth are similarly ineffective. Birmingham asks this circuit to ignore various cases that characterize escrow funds, insurance proceeds, and miscellaneous proceeds as “part and parcel” of real property. Appellant Br. at 44 (citing In re Kreitzer, 489 B.R. at 704; In re Ferandos, 402 F.3d at 151; Davis, 989 F.2d at 211; In re Rosen, 208 B.R. 345, 354 (D.N.J. 1997)). Additionally, Birmingham relies on In re Escue, 184 B.R. 287 (Bankr. M.D. Tenn. 1995) to contend that the bankruptcy court erred by not finding that the pertinent incidental items at issue constitute supplemental collateral, in light of the legislative history of the Bankruptcy Code. Appellant Br. at 48-49. The Escue decision came before §§ 101(13A)(A) and (27B) were enacted, however. Furthermore, as with many of the other cases that Birmingham has cited, the deed of trust at issue in Escue expressly created a security interest in certain fixtures with granting language that is wholly absent from the Birmingham Deed of Trust. Consequently, Birmingham’s reliance on Escue is misplaced.

Characterizing escrow funds, insurance proceeds, and miscellaneous proceeds as additional security for § 1322(b)(2) “would completely eviscerate the anti-modification exception of § 1322(b)(2) because many deeds of trust which encumber improved real property contain these provisions to protect the lender’s investment in the real property.” Akwa, 530 B.R. at 313 (internal quotation marks omitted). Moreover, as the district court noted, Congress did not intend for Birmingham’s position and “this principle cannot be squared with an interpretation that would render the anti-modification provision inapplicable to virtually all residential mortgages.” J.A. 682.

IV.

The Deed of Trust on Birmingham’s residence is secured only by real property that is also Birmingham’s principal residence. Escrow funds, insurance proceeds, and miscellaneous proceeds do not constitute additional collateral. Accordingly, Birmingham’s complaint fails to state a claim for relief that is plausible. For the foregoing reasons, the district court’s judgment is affirmed.

AFFIRMED