Anthony N Ozogu et al v. CitiMortgage Inc et al
Filing
42
MINUTES (IN CHAMBERS) RE PACIFICA L. NINETEEN, LLC'S AND ISERVE SERVICING, INC.'S MOTION 5 ; CITIMORTGAGE, INC.'S AND CITIBANK, N.A.'S MOTION 31 by Judge Christina A. Snyder. The Court hereby GRANTS CitiMortgage's and Citi bank's motion to dismiss plaintiffs' federal claims 31 . It appears that plaintiffs cannot cure the aforementioned deficiencies in their federal claims. Therefore, the Court finds it appropriate to dismiss plaintiffs' federal claims with prejudice. The Court declines to exercise supplemental jurisdiction over the remainder of plaintiffs' common law and state law claims, and DISMISSES them without prejudice to plaintiffs asserting them in state court. The Court hereby DENIES Pacifica's and iServe's motion to dismiss the complaint, or, in the alternative, motion to strike punitive damages as moot 5 . ( MD JS-6. Case Terminated ) (lom)
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
CV 10-9687 CAS (AGRx)
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
Present: The Honorable
Date
JS-6
July 19, 2011
CHRISTINA A. SNYDER
CATHERINE JEANG
Deputy Clerk
Not Present
Court Reporter / Recorder
N/A
Tape No.
Attorneys Present for Plaintiffs:
Attorneys Present for Defendants:
Not Present
Not Present
Proceedings:
(In Chambers:)
PACIFICA L. NINETEEN, LLC’S AND ISERVE
SERVICING, INC.’S MOTION TO DISMISS COMPLAINT,
OR, IN THE ALTERNATIVE, TO STRIKE PUNITIVE
DAMAGES (filed 12/23/10)
CITIMORTGAGE, INC.’S AND CITIBANK, N.A.’S
MOTION TO DISMISS PLAINTIFFS’ COMPLAINT (filed
05/19/11)
I.
INTRODUCTION
On October 22, 2010, plaintiffs Anthony N. Ozogu and Regina O. Thomas filed
suit in Los Angeles County Superior Court against CitiMortgage, Inc. (“CitiMortgage”);
CITIMORTGAGE, INC.; Citibank, N.A. (“Citibank”); CR Title Services (“CR Title”);
First American Title Insurance Co. (“First American”); Merscorp, Inc.; Mortgage
Electronic Registration Systems, Inc. (“MERS”); Pacifica L. Nineteen, LLC (“Pacifica”);
Orion Financial Group, Inc. (“Orion”); IServe Servicing, Inc. (“iServe”); Virkam S.
Pandit; Sanjiv Das; Deepak Israni; Mike E. Wileman; Richard Cimino; R.K. Arnold;
Jennifer Welborn (erroneously sued as Jennifer Wellborn); Tameka Harris; Aaron Doty;
Pam January; Richard Martinez; J. Florez; Kristen B. Linder; and Does 1 through 15
inclusive (collectively, “defendants”). On December 16, 2010, Pacifica, iServe, Israni,
Cimino, and Welborn removed the action to federal court based on federal question
jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1441(b).
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 1 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
Plaintiffs’ 121 page complaint advances 22 separate claims for relief in 617
paragraphs. Plaintiffs assert federal claims for: (1) violation of the Fair Debt Collection
Practices Act, 15 U.S.C. § 1692 et seq.; (2) disclosure violations, 15 U.S.C. § 1635 et
seq.; (3) missing consumer statement in violation of 12 C.F.R. § 226 et seq.; (4) failure to
disclose calculation of mortgage balance in violation of 12 C.F.R. § 226.4 et seq.; (5)
failure to disclose itemization of charges in or with the acceleration statement in violation
of 12 U.S.C. § 2610 et seq.; (6) inflation of acceleration fees in violation of 12 U.S.C. §§
2610 et seq.; (7) failure to disclose use of settlement fees in violation of Title 12,
Regulation Z, and 15 U.S.C. § 1601 et seq.; (8) failure to disclose lower interest rate in
violation of 12 U.S.C. § 2601 et seq.; (9) failure to disclose loan origination fee in
violation of 12 U.S.C. § 2601 et seq.; (10) failure to give proper notice of default, right to
cure and acceleration notice in violation of 12 U.S.C. § 2601 et seq., 15 U.S.C. § 1601 et
seq., 12 C.F.R. § 226.18, and Cal. Civ. Code § 2924 et seq.; (11) violation of Ozogu’s
constitutional right to Due Process under the Fifth Amendment; and (12) violation of
Thomas’s fundamental right to Due Process under the Fifth Amendment. Plaintiffs assert
state law claims for: (1) fraudulent inducement to breach a contract; (2) fraud in the
factum; (3) breach of the implied covenant of good faith and fair dealing; (4) wrongful
attempted foreclosure in violation of Cal. Civ. Code § 2924 et seq.; (5) to set aside
unlawful transfer against; (6) tortious interference with a contract; (7) violation of the
California Consumer Legal Remedies Act, Cal. Civ. Code §§ 1750–1784, Cal. Civ. Code
§ 1670.5; (8) violation of Cal. Bus. & Prof. Code § 17500; (9) violation of the California
Unfair Competition Law, Cal. Bus. & Prof. Code § 17200 et seq.; and (10) quiet title.
On May 4, 2011, plaintiffs voluntarily dismissed without prejudice defendants CR
Title; First American; Merscorp, Inc.; Orion; Virkam S. Pandit; Sanjiv Das; Deepak
Israni; Mike E. Wileman; Richard Cimino; R.K. Arnold; Jennifer Welborn (erroneously
sued as Jennifer Wellborn); Tameka Harris; Aaron Doty; Pam January; Richard Martinez;
J. Florez; and Kristen B. Linder. See Dkt. 25.
On May 16, 2011, the Court entered an order denying plaintiffs’ ex parte
application for a temporary restraining order.
On December 23, 2010, Pacifica and iServe filed a motion to dismiss the
complaint, or, in the alternative, motion to strike punitive damages. On January 18, 2011,
plaintiffs filed an opposition to Pacifica and iServe’s motion. Pacifica and iServe replied
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 2 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
on January 24, 2011. On May 19, 2011, CitiMortgage and Citibank (collectively, the
“Citi defendants”) filed a motion to dismiss. Plaintiffs filed an opposition on June 10,
2011. The Citi defendants replied on June 14, 2011. After carefully considering the
arguments set forth by both parties, the Court finds and concludes as follows.
II.
BACKGROUND FACTS
The instant action arises from a mortgage loan transaction secured by plaintiffs’
real property located at 19322 Ackermen Avenue, Santa Clarita, California (the
“Property”). Complaint ¶ 8, Ex. 1. On December 17, 2007, Ozogu executed a
promissory note in the amount of $417,000 (“Note”) in favor of CitiMortgage.
Complaint, Ex. 1. The Note was secured with a Deed of Trust (“DOT 1”) against the
Property, executed by both Ozogu and his wife Thomas (collectively, “plaintiffs”).
Complaint, Ex. 4. The original trustee named in DOT 1 was Verdugo Trustee Services
Corporation (“Verdugo”), and MERS was the nominee beneficiary for CitiMortgage and
its assigns. Complaint, Ex. 4.
In October 2009, plaintiffs attempted to obtain a loan modification from
CitiMortgage due to “their changing financial situation and . . . hardships they were
experiencing.” Complaint ¶ 152. Plaintiffs allege that they were placed in a three month
trial modification period in November 2009, wherein their loan payments were reduced
from $2,567.94 to $1,227.00 per month. Complaint ¶ 152. Plaintiffs allege that the trial
modification period lasted five months and that they paid the reduced amount to
CitiMortgage each month. Complaint ¶ 152. Plaintiffs allege that despite accepting their
modified loan payment for March 2010, CitiMortgage ultimately rejected their
application for a more permanent loan modification in February 2010. Complaint ¶ 153.
In a letter dated April 30, 2010, CitiMortgage officially denied plaintiffs’ loan
modification request. Complaint, Ex. 16.
In an assignment of Deed of Trust dated April 16, 2010, MERS assigned all
beneficial interest under DOT 1 to “CITIMORTGAGE, INC.”1 Also on April 16, 2010,
1
Plaintiffs allege that CITIMORTGAGE, INC. and CitiMortgage are distinct
entities.
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 3 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
CITIMORTGAGE, INC. substituted CR Title as trustee for Verdugo, and CR Title
executed a Notice of Default and Election to Sell to the Property. Complaint, Exs. 6–7.
Plaintiffs allege that they received the Notice of Default and Election to Sell on April 21,
2010. Complaint ¶ 155. Plaintiffs further allege that on April 27, 2010, plaintiffs
received a letter from CitiMortgage indicating that their “Workable Solution” application
for internal loan modification was denied due to plaintiffs’ Net Present Value (“NPV”).
Complaint ¶ 156. Plaintiffs allege that a CitiMortgage representative named “Ginger”
with ID # GC43156 researched plaintiffs’ application and determined that CitiMortgage
did not include all of plaintiffs’ household income in its calculation of plaintiffs’ NPV.
Complaint ¶ 156. Plaintiffs allege that they wrote CitiMortgage a letter disputing
CitiMortgage’s decision to deny their application for loan modification, but that
CitiMortgage never replied. Complaint ¶ 156.
Plaintiffs allege that on May 13, 2010, a third party, Selena Davis, informed them
that CitiMortgage agreed to re-evaluate their application for a loan modification.
Complaint ¶ 160. On July 22, 2010, however, Davis informed plaintiffs that their loan
had been sold to an unknown third party. Complaint ¶ 161. The following day, Ozogu
called CitiMortgage and spoke to Kelly with ID # KC78477, who confirmed that the loan
had been sold to an undisclosed company. Complaint ¶ 161. In fact, on July 26, 2010,
CitiMortgage executed a document formally assigning DOT 1 to the new owner of the
loan, Pacifica. Complaint, Ex. 9. On August 1, 2010, plaintiffs received a letter from
CitiMortgage indicating that the new servicer for their loan was iServe. Complaint ¶ 162.
Plaintiffs allege that they applied for a loan modification with iServe. Complaint ¶
163. On September 16, 2010, Welborn, iServe’s loan counselor, contacted Ozogu and
informed him that iServe was not willing to modify the loan because CitiMortgage had
previously denied plaintiffs’ loan modification application. Complaint ¶ 165. Plaintiffs
allege that they explained to Welborn that CitiMortgage delayed re-evaluating their
application for a loan modification, but Welborn was unmoved. Complaint ¶ 165.
Nevertheless, in a telephone call on September 24, 2010, Welborn requested that
plaintiffs send her a document from CitiMortgage detailing the status of plaintiffs’
request for a loan modification. Complaint ¶ 170. Plaintiffs allege that CitiMortgage
never provided them such documentation. Complaint ¶¶ 170–72.
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 4 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
On September 9, 2010, an assignment of CitiMortgage’s beneficial interest under
DOT 1 to Pacifica was recorded in the Los Angeles County Recorder’s Office.
Complaint ¶ 247, Ex. 9. On October 4, 2010, CR Title recorded a Notice of Trustee’s
Sale in the County Recorder’s Office. Complaint, Ex. 10.
III.
LEGAL STANDARD
A Rule 12(b)(6) motion tests the legal sufficiency of the claims asserted in a
complaint. “While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not
need detailed factual allegations, a plaintiff’s obligation to provide the ‘grounds’ of his
‘entitlement to relief’ requires more than labels and conclusions, and a formulaic
recitation of the elements of a cause of action will not do.” Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 555 (2007). “Factual allegations must be enough to raise a right
to relief above the speculative level.” Id. Stated differently, only a complaint that states
a claim for relief that is “plausible on its face” survives a motion to dismiss. Ashcroft v.
Iqbal, 129 S. Ct. 1937, 1949-50 (2009) (quoting Twombly, 550 U.S. at 570). “The
plausibility standard is not akin to the ‘probability requirement,’ but it asks for more than
a sheer possibility that a defendant has acted unlawfully.” Id.
In considering a motion pursuant to Fed. R. Civ. P. 12(b)(6), a court must accept as
true all material allegations in the complaint, as well as all reasonable inferences to be
drawn from them. Pareto v. F.D.I.C., 139 F.3d 696, 699 (9th Cir. 1998). The complaint
must be read in the light most favorable to the nonmoving party. Sprewell v. Golden
State Warriors, 266 F.3d 979, 988 (9th Cir. 2001); Parks Sch. of Bus., Inc. v. Symington,
51 F.3d 1480, 1484 (9th Cir. 1995). However, a court need not accept as true
unreasonable inferences or conclusory legal allegations cast in the form of factual
allegations. Sprewell, 266 F.3d at 988; W. Mining Council v. Watt, 643 F.2d 618, 624
(9th Cir. 1981).
Dismissal pursuant to Rule 12(b)(6) is proper only where there is either a “lack of a
cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal
theory.” Balistreri v. Pac. Police Dept., 901 F.2d 696, 699 (9th Cir. 1990).
Furthermore, unless a court converts a Rule 12(b)(6) motion into a motion for
summary judgment, a court cannot consider material outside of the complaint (e.g., facts
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 5 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
presented in briefs, affidavits, or discovery materials). In re American Cont’l
Corp./Lincoln Sav. & Loan Sec. Litig., 102 F.3d 1524, 1537 (9th Cir. 1996), rev’d on
other grounds sub nom Lexecon, Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523
U.S. 26 (1998). A court may, however, consider exhibits submitted with or alleged in the
complaint and matters that may be judicially noticed pursuant to Federal Rule of
Evidence 201. In re Silicon Graphics Inc. Sec. Litig., 183 F.3d 970, 986 (9th Cir. 1999);
Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001).
For all of these reasons, it is only under extraordinary circumstances that dismissal
is proper under Rule 12(b)(6). United States v. City of Redwood City, 640 F.2d 963, 966
(9th Cir. 1981).
As a general rule, leave to amend a complaint which has been dismissed should be
freely granted. Fed. R. Civ. P. 15(a). However, leave to amend may be denied when “the
court determines that the allegation of other facts consistent with the challenged pleading
could not possibly cure the deficiency.” Schreiber Distrib. Co. v. Serv-Well Furniture
Co., 806 F.2d 1393, 1401 (9th Cir. 1986); see Lopez v. Smith, 203 F.3d 1122, 1127 (9th
Cir. 2000).
IV.
DISCUSSION
A.
Federal Claims
1.
Claim 8: Violation of the Fair Debt Collection Practices Act
Plaintiffs allege that the Citi defendants violated the federal Fair Debt Collection
Practices Act, 15 U.S.C. § 1692 et seq. (“FDCPA”). See Complaint ¶¶ 417–446.
Plaintiffs fail to state a claim under the FDCPA because the Citi defendants are not
“debt collectors” within the meaning of the Act. The term “debt collector” is defined in
the statute to mean “any person who uses any instrumentality of interstate commerce or
the mails in any business the principal purpose of which is the collection of any debts, or
who regularly collects or attempts to collect, directly or indirectly, debts owed or due or
asserted to be owed or due another.” 15 U.S.C. § 1692a(6). The statute explicitly
excludes from the definition any party who attempts to collect a debt “to the extent such
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 6 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
activity . . . concerns a debt which was originated by such person.” 15 U.S.C. §
1602a(6)(F)(ii). Here, the Deeds of Trust attached as exhibits to plaintiffs’ complaint
demonstrate that CitiMortgage and Citibank originated plaintiffs’ loans. See Complaint,
Exhs. 4 & 5. Because the Citi defendants activities were aimed at collecting their own
debts, they are not “debt collectors” within the meaning of the FDCPA. See Tina v.
Countrywide Home Loans, Inc., No. 08 CV 1233 JM (NLS), 2008 WL 4790906, at *7
n.2 (S.D. Cal. Oct. 30, 2008) (holding that Countrywide was not a “debt collector” under
the FDCPA because its “conduct was directed to collecting its own debts.”).
Furthermore, “because ‘foreclosing on [a] property pursuant to a deed of trust is not the
collection of a debt within the meaning of the FDCPA,’” plaintiffs do not plead that the
Citi defendants were “collecting a debt.” Izenberg v. ETS Servs., LLC, 589 F. Supp. 2d
1193, 1199 (C.D. Cal. 2008) (quoting Hulse v. Ocwen Fed. Bank, FSB, 195 F. Supp. 2d
1188, 1204 (D. Or. 2002)). For both reasons, the Court DISMISSES plaintiffs’ FDCPA
claim with prejudice.
2.
Claims 9, 10, 11, 12, and 14: Truth in Lending Act
Plaintiffs’ ninth, tenth, eleventh, twelfth,2 and fourteenth claims all arise under the
federal Truth in Lending Act, 15 U.S.C. § 1601 et seq. (“TILA”) and/or Regulation Z
promulgated thereunder, 12 C.F.R. § 226 et seq. See Complaint ¶¶ 447–483, 493–501.
It appears that plaintiffs are seeking damages for defendants’ alleged violations of
TILA. See Complaint ¶¶ 451–456, 461–465, 470–474, 479–483, 497–501. An action
under TILA for actual or statutory damages must be brought “within one year from the
date of the occurrence of the violation.” 15 U.S.C. § 1640(e). The limitation period
3
2
Though captioned as a “Violation of 12 U.S.C. §§ 2610 et seq.,” the actual
allegations within the body of plaintiffs’ twelfth claim asserts a violation of 12 C.F.R. §
226.21. See Complaint ¶ 476.
3
Although plaintiffs do not appear to seek rescission under TILA, such a claim
appears to be futile because plaintiffs seeking rescission under TILA are required to show
that they are willing and able to tender the borrowed funds back to the lender. See
Yamamoto v. Bank of N.Y., 329 F.3d 1167, 1173 (9th Cir. 2003). Here, plaintiffs have
failed to demonstrate that they have the ability to tender the requisite loan proceeds.
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 7 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
starts to run “at the consummation of the [loan] transaction.” King v. California, 784
F.2d 910, 915 (9th Cir. 1986). As discussed above, plaintiffs executed the loan
transactions in December 2007. However, they did not bring their TILA claims until
October 2010 – nearly three years later. Thus, plaintiffs’ TILA damages claims are timebarred.
In certain circumstances, the doctrine of equitable tolling may “suspend the
limitations period,” such as when the borrower did not have reasonable opportunity to
discover the alleged fraud or nondisclosures that form the basis of plaintiff’s TILA claim.
King, 784 F.2d at 915. However, plaintiffs have not alleged any facts giving rise to
equitable tolling of the statute. See id. (“Congress placed a three year absolute limit on
rescission actions, demonstrating its willingness to put a limit on the scope of some types
of TILA actions.”); see also Huseman v. Icicle Seafoods, Inc., 471 F.3d 1116, 1120 (9th
Cir. 2006) (whether the statute of limitations should be equitably tolled is a factual
determination that “focuses on whether there was excusable delay by the plaintiff and
may be applied if, despite all due diligence, a plaintiff is unable to obtain vital
information bearing on the existence of his claim.”) (quotations and citations omitted)
(emphasis in original); Meyer v. Ameriquest Mortg. Co., 342 F.3d 899, 902 (9th Cir.
2003) (dismissing TILA claim, despite request for equitable tolling, where plaintiff was
in possession of all loan documents and did not allege any concealment or other conduct
that would have prevented discovery of the alleged TILA violations during the one year
limitations period).
Accordingly, the Court DISMISSES plaintiffs’ TILA claims with prejudice.
3.
Claims 13, 15, and 16: Real Estate Settlement Procedures Act
As their thirteenth, fifteenth, and sixteenth claims, plaintiffs allege violations of the
federal Real Estate Settlement Procedures Act, 12 U.S.C. § 2601 et seq. (“RESPA”). See
Complaint ¶¶ 484–492, 502–520. Plaintiffs allege that defendants violated RESPA by
“inflat[ing] the acceleration fees without operation of law,” “fail[ing] to disclose . . . that .
. . the loan . . . has an interest rate higher than the rate reflected in the Preliminary
Disclosures,” and “fail[ing] to disclose . . . that the loan obtained required loan
origination fees. . . .” Complaint ¶¶ 485, 504, 513.
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 8 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
The Citi defendants move to dismiss plaintiffs’ RESPA claims on the ground that
plaintiffs have no right of action to bring any of these claims. Mot. at 18–19 (citing
Gusenkov v. Wash. Mut. Bank, FA, No. C 09-04747 SI, 2010 WL 2612349, at *5 (N.D.
Cal. Jun. 24, 2010) (finding private right of action only for violations of 12 U.S.C. §§
2605, 2607, and 2608)). The Citi defendants argue that none of plaintiffs’ RESPA claims
even refer to Sections 2605, 2607 or 2608, much less demonstrate a violation of those
sections. Id. at 19. The Citi defendants further maintain that, to the extent plaintiffs’
allegations regarding “loan origination fees” may be construed as a reference to the fee
disclosure requirements of Section 2607, such a claim is time-barred by the section’s oneyear limitations period. Id. (citing 12 U.S.C. § 2614).
Plaintiffs have failed to offer any opposition to this aspect of the Citi defendants’
motion. Therefore, the Court finds that plaintiffs have abandoned their RESPA claims.
See Local Rule 7-12. Even if plaintiffs have not abandoned their RESPA claims, the
Court finds that plaintiffs fail to state a RESPA claim for the reasons identified by the
Citi defendants. Accordingly, the Court DISMISSES plaintiffs’ RESPA claims with
prejudice.
4.
Claim 17: Failure to Give Proper Notice of Default, Right to Cure,
and Acceleration Notice
Plaintiffs seventeenth claim is labeled “Failure to Give Proper Notice of Default,
Right to Cure, and Acceleration Notice.” This claim contains no substantive factual
allegations, and merely reiterates plaintiffs’ earlier statutory citations to TILA and
RESPA. Therefore, for the reasons identified in Sections IV.A.2 and IV.A.3, the Court
DISMISSES plaintiffs’ Failure to Give Proper Notice of Default, Right to Cure, and
Acceleration Notice claim with prejudice.4
4
Again, plaintiffs have failed to offer any opposition to this aspect of the Citi
defendants’ motion. Therefore, the Court finds that plaintiffs have abandoned this claim.
See Local Rule 7-12.
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 9 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.
CV 10-9687 CAS (AGRx)
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
5.
Date
JS-6
July 19, 2011
Claims 18 and 19: Violation of Due Process Rights Under the
Fifth Amendment
Plaintiffs eighteenth and nineteenth claims allege violations of their due process
rights under the Fifth Amendment to the Constitution based on defendants alleged failure
to provide them a loan modification under the federal Home Affordable Modification
Program (“HAMP”). See, e.g., Complaint ¶¶ 533–546, Opp’n at 16.
The due process clause of the Fifth Amendment prohibits the government from
depriving persons of “life, liberty, or property, without due process of law.” U.S. Const.
amend. V. “To be entitled to procedural due process, a party must show a liberty or
property interest in the benefit for which protection is sought.” Buckingham v. Sec’y of
U.S. Dep’t of Agric., 603 F.3d 1073, 1081 (9th Cir. 2010).
The Court is persuaded by the decisions of several district courts in this circuit
which have held that “HAMP does not provide Plaintiffs with a 'protected property
interest,' the denial of which must comport with due process.” Huxtable v. Geithner, No.
09cv1846 BTM (WVG), 2010 U.S. Dist. LEXIS 91382, at *14 (S.D. Cal. Sept. 2, 2010)
(quoting Williams v. Geithner, No. 09-1959 ADM, 2009 U.S. Dist. LEXIS 104096, at *7
(D. Minn. Nov. 9, 2009)); see also Orcilla v. Bank of America, N.A., No. C10-03931
HRL, 2010 WL 5211507, at *4 (N.D. Cal. Dec. 16, 2010) (same); Nguyen v. BAC Home
Loan Servs., LP, No. C-10-01712 RMW, 2010 WL 3894986, at *5 (N.D. Cal. Oct. 1,
2010) (same). Because plaintiffs do not have a protected property interest in a loan
modification under HAMP, their Fifth Amendment claims fail as a matter of law.
Accordingly, the Court DISMISSES plaintiffs’ Fifth Amendment claims with prejudice.
B.
State Law Claims
The remainder of plaintiffs’ claims for relief are based entirely on common law and
state law. In view of the Court’s dismissal of plaintiffs’ federal claims, the only apparent
basis for federal jurisdiction, the Court declines to exercise supplemental jurisdiction over
the remainder of plaintiffs’ claims. 28 U.S.C. § 1367; see Religious Tech. Ctr. v.
Wollersheim, 971 F.2d 364, 367–68 (9th Cir. 1992) (“When federal claims are dismissed
before trial . . . pendant state claims also should be dismissed.”) (quoting Jones v. Cmty.
Redev. Agency, 733 F.2d 646, 651 (9th Cir. 1984)) (alterations in original); Scholar v.
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 10 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
Pac. Bell, 963 F.2d 264, 268 n.4 (9th Cir. 1992) (same); Schultz v. Sundberg, 759 F.2d
714, 718 (9th Cir. 1985) (“Generally, dismissal of federal claims before trial dictates that
the pendent state claims should also be dismissed.”).
V.
CONCLUSION
In accordance with the foregoing, the Court hereby GRANTS CitiMortgage’s and
Citibank’s motion to dismiss plaintiffs’ federal claims. Specifically, the Court
DISMISSES with prejudice, the following claims:
•
Claim 8: Violation of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et
seq.
•
Claim 9: Disclosure Violations, 15 U.S.C. § 1635 et seq.
•
Claim 10: Missing Consumer Statement, 12 C.F.R. § 226 et seq.
•
Claim 11: Failure to Disclose Calculation of Mortgage Balance, 12 C.F.R. § 226.4
et seq.
•
Claim 12: Failure to Disclose Itemization of Charges In or With the Acceleration
Statement, 12 C.F.R. § 226.21
•
Claim 13: Inflation of Acceleration Fees, 12 U.S.C. § 2610 et seq.
•
Claim 14: Failure to Disclose Use of Settlement Fees, Title 12, Regulation Z, and
15 U.S.C. § 1601 et seq.
•
Claim 15: Failure to Disclose Lower Interest Rate, 12 U.S.C. § 2601 et seq.
•
Claim 16: Failure to Disclose Loan Origination Fee, 12 U.S.C. § 2601 et seq.
•
Claim 17: Failure to Give Proper Notice of Default, Right to Cure, and
Acceleration Notice, 12 U.S.C. § 2601 et seq., 15 U.S.C. § 1601 et seq., 12 C.F.R.
§ 226.18
CV-90 (06/04)
CIVIL MINUTES - GENERAL
Page 11 of 12
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Date
JS-6
Case No.
CV 10-9687 CAS (AGRx)
July 19, 2011
Title
ANTHONY N. OZOGU, ETC.; ET AL. v. CITIMORTGAGE, INC.; ET
AL.
•
Claim 18: Violation of Ozogu’s Constitutional Right to Due Process Under the
Fifth Amendment
•
Claim 19: Violation of Thomas’s Constitutional Right to Due Process Under the
Fifth Amendment
It appears that plaintiffs cannot cure the aforementioned deficiencies in their
federal claims. Therefore, the Court finds it appropriate to dismiss plaintiffs’ federal
claims with prejudice. See Schreiber Distrib. Co., 806 F.2d at 1401. The Court declines
to exercise supplemental jurisdiction over the remainder of plaintiffs’ common law and
state law claims, and DISMISSES them without prejudice to plaintiffs asserting them in
state court. The Court hereby DENIES Pacifica’s and iServe’s motion to dismiss the
complaint, or, in the alternative, motion to strike punitive damages as moot.
IT IS SO ORDERED.
00
Initials of Preparer
CV-90 (06/04)
CIVIL MINUTES - GENERAL
:
00
CMJ
Page 12 of 12
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?