Grecian v. Nationstar Mortgage LLC et al
Filing
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ORDER granting 48 Defendant's Motion to Dismiss. Because Plaintiff has had three opportunities to state a claim and has failed to do so, further leave to amend will not be granted. The Clerk is directed to terminate this action. Signed by Judge David G Campbell on 5/15/14.(LSP)
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IN THE UNITED STATES DISTRICT COURT
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FOR THE DISTRICT OF ARIZONA
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Todd P. Grecian,
No. CV-13-08089-PCT-DGC
Plaintiff,
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v.
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Nationstar Mortgage LLC, et al.,
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ORDER
Defendants.
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Defendant Nationstar Mortgage, LLC has filed a motion to dismiss the Second
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Amended Complaint. Doc. 48. The motion has been fully briefed. For the reasons
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stated below, the motion will be granted and the complaint dismissed with prejudice.1
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I.
Background.
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On June 13, 2004, Plaintiff obtained a loan secured by a deed of trust on property
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at 3033 Palo Verde Boulevard South, Lake Havasu City, Arizona, in the amount of
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approximately $188,000. Doc. 35, ¶ 8. Defendant was the beneficiary of the deed. Id.,
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¶ 9. Plaintiff fell behind on his loan payments in June 2011 and desired to cure the
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arrears with a loan modification. Id. ¶ 13. Plaintiff submitted a complete application for
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a loan modification to Aurora Loans, Defendant’s predecessor in interest. Id., ¶ 14.
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Nothing came of Plaintiff’s application for a loan modification. Defendant recorded a
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Defendant’s request for oral argument is denied because the issues have been
fully briefed and oral argument will not aid the Court’s decision. See Fed. R. Civ. P.
78(b); Partridge v. Reich, 141 F.3d 920, 926 (9th Cir. 1998).
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Notice of Trustee’s Sale under Deed of Trust on June 13, 2012, and scheduled a trustee’s
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sale of the property for September 18, 2012. Id., ¶ 10. Plaintiff alleges, however, that he
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had entered into negotiations with Defendant for a loan modification and was given
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assurances that the property would not be sold. Id., ¶ 16.
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Plaintiff alleges that his efforts bore fruit, and that, in a letter dated December 19,
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2012, he was granted a loan modification agreement that reduced his monthly payments
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to $1,155.09 for a year. Id., ¶ 17. Plaintiff complains that the December 19 letter
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required payment of $3,400.00 and the return of certain signed documents by
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November 30, 2012, which had already passed by the time the letter was sent. Id., ¶ 18.
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Plaintiff claims he attempted to contact Defendant’s representative about the date
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discrepancy to no avail. Id., ¶ 19. Plaintiff then claims both that complying with the
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letter’s orders to make payment and return the documents “had been rendered impossible
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by the very text of the NSM letter” (id., ¶ 19) and that he “relied to his detriment” on the
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letter “in believing that the Loan Modification . . . had been granted under the terms
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stated in the letter” (id., ¶ 20).
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Plaintiff filed his initial complaint on April 16, 2013, alleging various claims
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including fraud, unjust enrichment, wrongful foreclosure, and violations of federal law.
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Doc. 1. Defendant moved to dismiss the initial complaint, and the Court granted the
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motion with leave to amend a limited number of claims. Doc. 20. Plaintiff filed an
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amended complaint on September 13, 2013, asserting only a claim for fraud,
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misrepresentation, or concealment. Doc. 22. Defendant again moved to dismiss the
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amended complaint and the Court again granted the motion. Doc. 34. Because Plaintiff
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was proceeding pro se, the Court gave Plaintiff leave to amend one last time to cure the
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deficiencies of the complaint. Id. In its order granting Plaintiff a final opportunity to
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amend, the Court directed that the complaint address the deficiencies from both orders
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dismissing the complaints and that it specify the precise nature of Plaintiff’s fraud claim.
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Id. at 4. The Court warned that failure to satisfy the pleading standards articulated in its
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two orders would result in dismissal without leave to amend. Id.
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II.
Legal Standard.
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When analyzing a complaint for failure to state a claim to relief under
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Rule 12(b)(6), the well-pled factual allegations are taken as true and construed in the light
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most favorable to the nonmoving party. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th
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Cir. 2009). Legal conclusions couched as factual allegations are not entitled to the
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assumption of truth, Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009), and therefore are
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insufficient to defeat a motion to dismiss for failure to state a claim, In re Cutera Sec.
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Litig., 610 F.3d 1103, 1108 (9th Cir. 2010). To avoid a Rule 12(b)(6) dismissal, the
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complaint must plead enough facts to state a claim to relief that is plausible on its face.
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Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). This plausibility standard “is not
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akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a
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defendant has acted unlawfully.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at
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556). “[W]here the well-pleaded facts do not permit the court to infer more than the mere
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possibility of misconduct, the complaint has alleged B but it has not ‘show[n]’ B ‘that the
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pleader is entitled to relief.’” Id. at 679 (quoting Fed. R. Civ. P. 8(a)(2)). Where a
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complaint alleges fraud, Rule 9(b) requires that a party “state with particularity the
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circumstances constituting fraud or mistake.”
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III.
Analysis.
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In its previous order, the Court noted that Plaintiff’s first amended complaint
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failed adequately to plead the who, what, when, and where of the alleged fraud, and that
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Plaintiff omitted key facts necessary to make the claim plausible.
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Plaintiff’s second amended complaint (“SAC”) does not correct this deficiency.
Doc. 34 at 3.
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The SAC asserts a claim for common law fraud. Doc. 35. Such a claim requires:
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(1) a representation, (2) its falsity, (3) its materiality, (4) the speaker’s knowledge of its
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falsity or ignorance of its truth, (5) his intent that it should be acted upon by the person
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and in the manner reasonably contemplated, (6) the hearer’s ignorance of its falsity,
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(7) his reliance on its truth, (8) his right to rely thereon, and (9) his consequent and
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proximate injury. Nielson v. Flashberg, 419 P.2d 514, 517-18 (Ariz. 1966).
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The gravamen of the SAC is that Defendant made false and misleading statements
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in the December 19, 2012 letter. Docs. 35; 54 at 4. Although the SAC alleges in some
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places that false statements were made by Defendant’s employee Mike Kanzler, the only
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false statements identified in the SAC are those in the letter, a copy of which is attached
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as Exhibit D to the SAC. See Doc. 35, ¶¶ 15, 16, 17, 18, 19, 20, 26, 27, 28, 29, 30, 31,
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32, 34, 35, 36, 37.
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The letter informed Plaintiff that his loan modification had been approved and
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would be finalized when he submitted a payment of $3,400 and certain documents by
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November 30, 2012 – a date that had already passed. Doc. 35-1 at 22. Plaintiff noticed
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the date discrepancy and attempted to resolve it with Defendant’s representative, but
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received no response. Doc. 35, ¶¶ 30-35. Having received no clarification on the date,
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and having made no payment or executed the required documents, Plaintiff nonetheless
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claims that he “detrimentally relied upon the written representations” of the letter to
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conclude that the loan had been modified. Id.
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As noted in the Court’s earlier order, the letter clearly indicated that further steps
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were required to finalize the modification. Doc. 35-1 at 22. The letter stated that the
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modification agreement must be signed and returned within 30 days of receipt and that
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the initial payment of $3,400 must be made. Id. The fact that the letter postdated the due
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date should, if anything, have prompted Plaintiff to complete the required steps even
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more promptly to finalize the loan modification, but Plaintiff does not allege that he took
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any steps to comply with the terms of the letter.
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Plaintiff’s complaint still does not sufficiently allege certain elements of fraud.
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Plaintiff has not alleged any facts indicating that Defendant somehow intended Plaintiff
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to be misled by the clearly incorrect November due date. Nor does the complaint clearly
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allege that Plaintiff was ignorant of the alleged false statement – it alleges, rather, that he
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noticed the incorrect date and attempted to contact Defendant about it. Doc. 35, ¶¶ 19,
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20. The complaint also fails to allege facts that would support Plaintiff’s allegation that
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he reasonably relied on a letter – or had the right to rely on a letter – that clearly said
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additional steps were required to complete the loan modification.
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In addition to these deficiencies in the elements of common law fraud, the claim
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alleged in the complaint simply is not plausible. Iqbal, 556 U.S. at 678. The letter upon
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which Defendant bases his entire case stated that certain steps were required “to complete
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your loan modification,” and that he should “[c]omplete the following steps to finalize
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your loan modification.” Doc. 35-1 at 22. Plaintiff admits that he did not complete the
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steps. Given these facts, Plaintiff’s claim that he was misled by the letter into believing
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that an enforceable modification had been completed is not plausible.
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IT IS ORDERED that Defendant’s motion to dismiss (Doc. 48) is granted.
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Because Plaintiff has had three opportunities to state a claim and has failed to do so,
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further leave to amend will not be granted. The Clerk is directed to terminate this
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action.
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Dated this 15th day of May, 2014.
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