Jon W. Warwick et al v. Bank of New York Mellon

Filing 35

MEMORANDUM AND ORDER:(1) DENYING PLAINTIFFS' MOTION TO REMAND (Dkt. No. 19 ); (2) GRANTING IN PART BANK OF AMERICA, N.A.'S MOTION TO DISMISS (Dkt. No. 10 ); (3) GRANTING IN PART GREEN TREE SERVICING, LLC'S MOTION TO DISMISS (Dkt. No. 7 ); AND (4) DISMISSING FIRST AMENDED COMPLAINT by Magistrate Judge Suzanne H. Segal. Plaintiffs' Motion to Remand is DENIED. BANA's Motion to Dismiss and Green Tree's Motion to Dismiss are each GRANTED IN PART and DENIED IN PART. Th e Court concludes that the FAC, as amended by the substitution of BANA and Green Tree for Doe Defendants Nos. 1 and 2, fails to put these two Defendants on notice of the claims against them. Accordingly, the FAC is DISMISSED WITH LEAVE TO AMEND. If Plaintiffs wish to pursue their claims, they shall file a Second Amended Complaint within fourteen days after the date of the settlement conference ordered by the Court as discussed at the hearing. (See document for further details). (mr)

1
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8

UNITED STATES DISTRICT COURT

9

CENTRAL DISTRICT OF CALIFORNIA

10
11

JON W. WARWICK, et al.,
Plaintiffs,

12
13
14

Case No. CV 15-3343 SS
MEMORANDUM AND ORDER:

v.

(1) DENYING PLAINTIFFS’ MOTION
TO REMAND (Dkt. No. 19);

BANK OF NEW YORK MELLON, et
al.,

(2) GRANTING IN PART BANK OF
AMERICA, N.A.’S MOTION TO
DISMISS (Dkt. No. 10);

15
Defendants.
16

(3) GRANTING IN PART GREEN
TREE SERVICING, LLC’S
MOTION TO DISMISS (Dkt.
No. 7); AND

17
18

(4) DISMISSING FIRST AMENDED
COMPLAINT WITH LEAVE TO
AMEND

19
20
21
22

I.

23

INTRODUCTION

24
25

Plaintiffs Jon W. Warwick and Jeanette Warwick, California

26

residents proceeding pro se, filed this quiet title action in the

27

Ventura

28

Superior Court of California, County of Ventura, Case Information

County

Superior

Court

on

December

17,

2013.

(See

1

Website, http://www.ventura.courts.ca.gov/via.html, Case No. 56-

2

2013-00445950). 1

3

operative

4

Removal, Dkt. No. 1, Exh. B at 12). 2

5

declaration that “Plaintiffs own and hold the property free and

6

clear of any interest and adverse claims asserted herein by any

7

Defendant.”

8

dismissed all Defendants named in the FAC except the Bank of New

9

York Mellon (“BONYM”).

First

On

February

Amended

(Id. at 16).

11,

Complaint

2014,

Plaintiffs

(“FAC”).

(See

filed

the

Notice

of

The FAC seeks only a

On April 25, 2014, the superior court

(See id. at 22).

10
11

BONYM filed a Motion for Judgment on the Pleadings on May

12

16, 2014, which the superior court denied in a reasoned opinion

13

on July 10, 2014.

14

filed a Motion for Summary Judgment on October 27, 2014, which

15

the state court denied on April 13, 2015.

16

see also Superior Court of California, County of Ventura, Case

17

Information

18

Case No. 56-2013-00445950, State Ct. Dkt. No. 113).

19

2015, the state court scheduled the matter for a jury trial on

20

1

21
22
23
24

(See Dkt. No. 21, Exh. 2).

Website,

26
27
28

(See Dkt. No. 7, at 6;

http://www.ventura.courts.ca.gov/via.html,
On April 20,

The Court takes judicial notice of the docket in Plaintiff’s
state court proceedings. See In re Korean Air Lines Co., Ltd.,
642 F.3d 685, 689 n.1 (9th Cir. 2011) (a court may take judicial
notice of a court’s own records in other cases and the records of
other courts); see also Porter v. Ollison, 620 F.3d 952, 955 n.1
(9th Cir. 2010) (taking judicial notice of court dockets,
including those available on the Internet, from petitioner’s
state court proceedings).
2

25

BONYM subsequently

The Court will cite to the Notice of Removal and its
attachments, with the exception of the declaration of Brendan F.
Hug, as though they formed a single, consecutively paginated
document. Similarly, the Court will cite to the Hug declaration
and its exhibits as though they formed another single,
consecutively paginated document.
Unless otherwise specified,
references to docket numbers refer to the instant federal matter.
2

1

May 18, 2015.

2

at 6).

(Id., State Ct. Dkt. No. 292; see also Dkt. No. 7

3
4

On April 6, 2015, shortly before the state court denied

5

BONYM’s motion for summary judgment and set the case for trial in

6

mid-May, Plaintiffs added two new parties by substituting Green

7

Tree Servicing LLC (“Green Tree”) for Doe Defendant No. 1 and

8

Bank of America, N.A. (“BANA”) for Doe Defendant No. 2.

9

Superior Court of California, County of Ventura, Case Information

10

Website, http://www.ventura.courts.ca.gov/via.html, Case No. 56-

11

2013-00445950, State Ct. Dkt. Nos. 270-71 & 282-83).

12

moved

13

against BANA and Green Tree.

14

2015, BANA removed this action to federal court on the basis of

15

diversity jurisdiction.

16

filed a Joinder and Consent to Removal of Action simultaneously

17

with BANA’s Notice of Removal.

the

court

to

reopen

discovery

to

pursue

Plaintiffs

their

(See Dkt. No. 19 at 5).

(See Dkt. No. 1).

(See

claims

On May 4,

Green Tree and BONYM

(See Dkt. No. 2).

18
19

On May 11, 2015, Green Tree filed a Motion to Dismiss,

20

(“Green Tree MTD,” Dkt. No. 7), including a Request for Judicial

21

Notice.

22

Opposition to the Green Tree MTD on June 26, 2015.

23

Tree MTD,” Dkt. No. 28).

24

2015.

(“Green Tree RJN,” Dkt. No. 8).

Plaintiff filed an
(“Opp. Green

Green Tree filed a Reply on July 2,

(“Reply Green Tree MTD,” Dkt. No. 32).

25
26

BANA also filed a Motion to Dismiss on May 11, 2015, (“BANA

27

MTD”), including a Request for Judicial Notice.

28

Dkt. No. 10).

(“BANA RJN,”

Plaintiffs filed an Opposition to the BANA MTD on
3

1

June 26, 2015.

2

Reply on July 2, 2015.

(“Opp. BANA MTD,” Dkt. No. 29).

BANA filed a

(“Reply BANA MTD,” Dkt. No. 31).

3
4

On

June

3,

2015,

Plaintiffs

filed

a

Motion

to

Remand

5

(“Remand Motion,” Dkt. No. 19), including the Joint Declaration

6

of Jon W. Warwick and Jeannette Warwick (“Warwick Decl.,” Dkt.

7

No. 20), and a Request for Judicial Notice.

8

No. 21).

9

Remand,” Dkt. No. 23), which BONYM and Green Tree joined.

(“Warwick RJN,” Dkt.

BANA filed an Opposition on June 16, 2014, (“Opp.

10

Remand Joinder,” Dkt. No. 24).

11

23, 2015.

(“Opp.

Plaintiffs filed a Reply on June

(“Reply Remand,” Dkt. No. 27).

12
13

For

the

reasons

stated

below,

14

diversity

15

Plaintiffs’ Motion to Remand.

16

Motion to Dismiss filed by BANA.

17

Tree’s Motion to Dismiss.

18

the

Court

on

that

concludes

that

TO AMEND.

jurisdiction

exists

and

ground

DENIES

The Court GRANTS IN PART the
The Court GRANTS IN PART Green

The FAC is DISMISSED, but WITH LEAVE

19
20

II.

21

PLAINTIFFS’ MOTION TO REMAND

22
23

Plaintiffs

argue

this

their

Court

case

does

lacks
not

subject

present

jurisdiction

25

question.

26

contend that BANA and Green Tree cannot create diversity because

27

they

28

acknowledge

(Remand Motion at 7-8 & 18-23).

“nominal
that

parties.”

the

Court

(Id.
does
4

not

at

a

matter

24

are

because

that

federal

Plaintiffs further

9-15).

have

federal

Defendants
question

1

jurisdiction,

but

2

jurisdiction

under

3

Defendants are correct.

argue
28

that

U.S.C.

the

Court

§ 1332.

does

(Opp.

have
Remand

diversity
at

2-4).

Plaintiffs’ Motion to Remand is DENIED. 3

4
5

A.

Remand Standards

6
7

Removal of a case from state court to federal court is

8

governed by 28 U.S.C. § 1441, which provides in relevant part

9

that “any civil action brought in a State court of which the

10

district courts of the United States have original jurisdiction,

11

may be removed . . . to the district court of the United States

12

for the district and division embracing the place where such

13

action is pending.”

14

original subject matter jurisdiction where an action presents

15

either a federal question under 28 U.S.C. § 1331 or diversity of

16

citizenship

17

diversity jurisdiction only when there is complete diversity of

18

citizenship among adverse parties and the amount in controversy

19

exceeds $75,000.

20

be ordered for lack of subject matter jurisdiction or any defect

21

in the removal procedure.

22

\\

23

\\

24

3

25
26
27
28

under

28

28 U.S.C. § 1441(a).

U.S.C.

§ 1332.

28 U.S.C. § 1332(a).

Federal courts have

Generally,

a

court

has

Remand to state court may

28 U.S.C. § 1447(c).

Plaintiffs ask the Court to take judicial notice of certain
court orders, a proof of service of the summons on BANA, and
BONYM’s verified answer to the FAC in the underlying state court
proceedings. (Warwick RJN, Exhs. 1-5). As noted above, a court
may take judicial notice of the records of other courts. In re
Korean Air Lines Co., Ltd., 642 F.3d 685, 689 n.1 (9th Cir.
2011).
Accordingly, Plaintiffs’ request for judicial notice is
GRANTED.
5

1

To

protect

the

jurisdiction

of

state

courts,

removal

2

jurisdiction is strictly construed in favor of remand.

3

Bankers Life and Cas. Co., 425 F.3d 689, 698 (9th Cir. 2005); see

4

also Abrego Abrego v. Dow Chem. Co., 443 F.3d 676, 684 (9th Cir.

5

2006) (“‘It is presumed that a cause lies outside the limited

6

jurisdiction of the federal courts . . . .’”) (quoting Kokkonen

7

v.

8

(internal

9

whether removal is proper, remand must be ordered.

Guardian

Life

Ins.

brackets

Co.

of

Am.,

511

U.S.

If

there

is

omitted)).

375,
any

Harris v.

377

doubt

(1994)
as

to

Ethridge v.

10

Harbor House Rest., 861 F.2d 1389, 1393 (9th Cir. 1988).

“The

11

party seeking removal bears the burden of establishing federal

12

jurisdiction.”

Id.

13
14

B.

Discussion

15
16

To

establish

diversity

jurisdiction,

and

thus

defeat

17

Plaintiffs’ Motion to Remand, Defendants must show that there is

18

complete

19

Defendants, and that the amount in controversy equals or exceeds

20

$75,000.

21

¶ 1); see also Kanter v. Warner-Lambert Co., 265 F.3d 853, 857

22

(9th

23

jurisdiction,

24

determined by her state of domicile, . . . where she resides with

25

the intention to remain or to which she intends to return.”).

26

Therefore, diversity of citizenship will not exist if any of the

27

Defendants is also a citizen of California.

diversity

Id.

Cir.

of

citizenship

between

Plaintiffs

Plaintiffs are citizens of California.

2001)
a

(for

“natural

purposes

of

person’s

state

28
6

establishing
citizenship

and

(See FAC

diversity
is

. . .

1

Of the three surviving Defendants in this case, two, BANA

2

and BONYM, are national banks.

3

Opp. Remand at 2).

4

banks

5

pertinent part:

6

the purposes of all other actions by or against them, be deemed

7

citizens of the States in which they are respectively located.’”

8

Rouse v. Wachovia Mortg., FSB, 747 F.3d 707, 709 (9th Cir. 2014)

9

(quoting 28 U.S.C. § 1348).

is

governed

(Notice of Removal at 3; see also

“[T]he citizenship of nationally chartered
by

28

U.S.C.

§

1348,

which

provides

in

‘All national banking associations shall, for

According to the Ninth Circuit,

10

pursuant to section 1348, a national bank is therefore “only a

11

citizen of the state designated in its articles of association as

12

its main office.”

13

546

14

purposes, is a citizen of the State in which its main office, as

15

set forth in its articles of association, is located.”).

16

states it is a citizen of North Carolina and BONYM is a citizen

17

of New York, and Plaintiffs do not challenge these statements.

18

(Opp. Remand at 2).

19

citizenship between Plaintiffs on the one hand, and BANA and

20

BONYM on the other.

U.S.

303,

Id. at 711; see also Wachovia Bank v. Schmidt,
307

(2006)

(“[A]

national

bank,

for

§ 1348

BANA

Accordingly, there is complete diversity of

21
22

There is also diversity of citizenship between Green Tree,

23

the third surviving Defendant, and Plaintiffs.

Green Tree is a

24

limited

Remand

25

Declaration of Wanda J. Lamb-Lindow ¶ 3).

26

citizen

27

principal place of business.

28

1181, 1884 (2010).

liability

of

any

company

state

(“LLC”).

where

it

is

(Opp.

Joinder,

A corporation is a

incorporated

or

has

its

Hertz Corp. v. Friend, 130 U.S.

Furthermore, an LLC is a citizen of every
7

1

state in which its owners or members are citizens.

2

v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir.

3

2006) (“We therefore join our sister circuits and hold that, like

4

a partnership, an LLC is a citizen of every state of which its

5

owners/members are citizens.”).

6

Opposition, Green Tree included the declaration of one of its

7

officers who testified to the identity and composition of all of

8

Green

9

respective

Tree’s

members

states

(as

of

See Johnson

In its joinder to the Remand

well

as

their

citizenship.

members),

(Opp.

and

Remand

their

Joinder,

10

Declaration of Wanda J. Lamb-Lindow ¶¶ 5-15).

11

nor any of its members (or its members’ members) is a citizen of

12

California.

13

citizenship exists between Plaintiffs and Green Tree as well.

(See

id.).

Therefore,

Neither Green Tree

complete

diversity

of

14
15

Rather

than

challenge

Defendants’

respective

states

of

16

citizenship, Plaintiffs argue that BANA and Green Tree should not

17

be

18

“nominal” defendants.

19

that the citizenship of “nominal defendants” may be disregarded

20

for purposes of determining diversity under section 1441.

21

court explained,

considered

in

the

diversity

analysis

because

(Remand Motion at 9-15).

they

It is correct

As one

22
assessing

23

In

24

disregard

25

jurisdiction only upon the citizenship of real parties

26

to the controversy.”

27

1177, 1183 (9th Cir. 2004).

28

“who

has

diversity,

nominal

no

or

interest

“[a]

federal

formal

court

must

and

rest

parties

Kuntz v. Lamar Corp., 385 F.3d

in

the
8

A nominal party is one
action”

and

are

is

merely

1

joined

2

Real Estate Affiliates, Inc. v. PPR Realty, Inc., 204

3

F.3d

4

nominal defendant is a trustee, agent, or depository

5

who

6

collection.”

7

(9th

8

also Hafiz v. Greenpoint Mortg. Funding, Inc., 652 F.

9

Supp.

to

“perform

867,

is

873

(9th

joined

Cir.

ministerial

Cir.

merely

act.”

2000).

as

a

Prudential

“The

means

paradigmatic

of

facilitating

[S.E.C. v. Colello, 139 F.3d 674, 676

1998)]

2d

a

(internal

1050,

1052

quotations

(N.D.

Cal.

10

defendant

11

capacity

12

wrongdoing

13

filed

14

omitted);

2009)

see

(trustee

California Civil Code section 2924l).

named
as

in

a

was

the

complaint

trustee
a

declaration

and

nominal
of

not

solely

in

its

because

of

any

defendant,

nonmonetary

where

status

trustee

pursuant

to

15
16

Perez v. Wells Fargo Bank, N.A., 929 F. Supp. 2d 988, 1002 (N.D.

17

Cal. 2013) (recognizing nonetheless that trustees may be “more

18

than

19

alia, substantive allegations against the trustee and claims for

20

money damages); see also Hewitt v. City of Stanton, 798 F.2d

21

1230,

22

removal petition with the exception of nominal parties.”).

nominal

1232

defendants”

(9th

Cir.

where

1986)

the

(“All

complaint

defendants

includes,

must

inter

join

in

a

23
24

However,
if

the

the

import

27

because

28

citizens of California.

of

New

BANA’s

York

and

unclear.

respective states of citizenship, diversity would still exist
citizen

ignore

is

26

a

to

argument

Even

is

were

Plaintiffs’

25

BONYM

Court

of

and

Green

Tree’s

Plaintiffs

are

Accordingly, the exclusion of BANA and
9

1

Green Tree from the Court’s consideration would not change the

2

ultimate

3

exists between Plaintiffs and Defendants.

determination

that

complete

diversity

of

citizenship

4
5

To

the

extent

that

Plaintiffs’

argument

can

somehow

be

6

construed to imply that a “nominal defendant” is precluded from

7

initiating

8

argument also fails.

9

and nominal defendants without an interest in the outcome, must

the

removal

of

an

action

to

federal

court,

the

All defendants, except fraudulently named

10

join in or otherwise approve a removal petition.

11

nothing precludes a so-called nominal defendant from filing a

12

removal petition in which all other defendants join, as here.

13

See EIE Guam Corp. v. Long Term Credit Bank of Japan, Ltd., 322

14

F.3d 635, 643 (9th Cir. 2003) (citing with approval Citibank,

15

N.A. v. Nyland (CF8) Ltd., 878 F.2d 620, 624 (2d Cir. 1989), in

16

which

17

contention that a “nominal defendant . . . did not have the power

18

to remove the case to federal court . . . .”).

the

Second

Circuit

expressly

rejected

Id.

a

However,

defendant’s

19
20

Having established that complete diversity of citizenship

21

exists, Defendants need only show that the amount in controversy

22

exceeds

23

controversy is calculated by the value of the property at issue.

24

Chapman v. Deutsche Bank Nat. Trust Co., 651 F.3d 1039, 1045 n.2

25

(9th Cir. 2011); see also Cohn v. Petsmart, Inc., 281 F.3d 837,

26

840

27

declaratory or injunctive relief, it is well established that the

28

amount in controversy is measured by the value of the object of

$75,000.

(9th

Cir.

In

2002)

a

quiet

(per

title

curiam)

10

action,

(“‘In

the

amount

actions

in

seeking

1

the

2

Comm’n, 432 U.S. 333, 347 (1977)).

3

declaration suggesting that the value of the real property at

4

issue

5

Declaration of Brendan F. Hug ¶ 7).

6

Remand or Reply do Plaintiffs dispute that the current value of

7

the property at issue exceeds $75,000.

8

the

9

diversity jurisdiction exists.

10

litigation.’”)

was

amount

well

in

(quoting

over

Hunt

$300,000

controversy

v.

in

Wash.

State

Apple

Adver.

Defendants have submitted a

2005.

(Notice

of

Removal,

Nowhere in their Motion to

requirement

The Court concludes that
is

also

met

and

that

Accordingly, Plaintiffs’ Motion

to Remand is DENIED.

11
12

III.

13

DEFENDANTS’ MOTIONS TO DISMISS

14
15

BANA argues in its Motion to Dismiss that Plaintiffs’ claims

16

against

17

“absolutely no allegations of any kind regarding” BANA “or its

18

purported adverse claim to Plaintiffs’ title.”

19

4).

20

loan on behalf of the investor for a period of time” but released

21

its servicing rights to Green Tree over a year ago and “no longer

22

maintains any interest in the subject property, either title-

23

related or otherwise.”

24

4

25

it

should

be

dismissed

because

the

FAC

contains

(BANA MTD at 1 &

BANA further states that it simply “serviced [Plaintiffs’]

(Id. at 1). 4

Additionally, BANA contends

The following overview of California real estate law provides a
context for Defendants’ arguments in their respective Motions to
Dismiss.

26
27
28

“The financing or refinancing of real property in California is
generally accomplished by the use of a deed of trust.” Jenkins
v. JP Morgan Chase Bank, N.A., 216 Cal. App. 4th 497, 507 (2013).
“A deed of trust . . . conveys title to real property from the
11

1

that the FAC fails to state a claim because Plaintiffs have not

2

pled tender of the amount allegedly owing on the property.

3

at 5-7).

(Id.

4
5

Green

Tree

also

argues

in

its

Motion

to

Dismiss

that

6

Plaintiffs’ claims should be dismissed because the claims against

7

the Doe Defendants are uncertain and because Plaintiffs failed to

8

allege that they have paid off the debt allegedly owed on the

9

property.

(Green Tree MTD at 4 & 6).

Green Tree further argues

10

that Plaintiffs lack standing to challenge the enforceability of

11

a deed of trust due to defects in transfers and assignments of a

12

borrower’s debt because “California law does not recognize such a

13

cause of action.”

(Id. at 4).

14
15
16
17
18

trustor-debtor to a third party trustee to secure the payment of
a debt owed to the beneficiary-creditor under a promissory note.”
Id. at 508.
“[T]here is little practical difference between
mortgages and deeds of trust; they perform the same basic
function . . . [A] deed of trust is practically and substantially
only a mortgage with power of sale” should the trustor-debtor
fail to pay back the debt owed under the promissory note. Id. at
508 n.2 (internal quotation marks and citation omitted).

19
20
21
22
23
24
25
26
27
28

Under the deed of trust model, the debt owner, as the trust’s
beneficiary, not the “trustee,” retains the power to foreclose.
See Rossberg v. Bank of America, N.A., 219 Cal. App. 4th 1481,
1492 (2013) (“When a trustor-debtor defaults ‘on a debt secured
by a deed of trust, the beneficiary-creditor may elect to
judicially or nonjudicially foreclose on the real property
security.’”) (quoting Jenkins, 216 Cal. App. 4th at 508).
“The
trustee of a deed of trust is not a true trustee, and owes no
fiduciary obligations; he merely acts as a common agent” for the
debt owner-beneficiary of the deed of trust. Vournas v. Fidelity
Nat. Title Ins. Co., 73 Cal. App. 4th 668, 677 (1999); see also
Jenkins, 216 Cal. App. 4th at 508 (“[A]lthough the deed of trust
technically conveys title to the real property from the trustordebtor to the trustee, the extent of the trustee’s interest in
the property is limited to what is necessary to enforce the
operative provisions of the deed of trust.”).
12

1

As further explained below, the Court agrees that the FAC’s

2

vague allegations fail to put BANA and Green Tree on fair notice

3

of

4

Green Tree’s respective Motions to Dismiss are GRANTED IN PART

5

and the FAC is DISMISSED, WITH LEAVE TO AMEND.

6

not agree, however, that Plaintiffs are required to allege tender

7

of an amount owing on a loan that, based on the allegations of

8

the FAC, they do not claim exists.

9

permits

Plaintiffs’

a

claims

borrower

against

to

them.

raise

a

Accordingly,

BANA’s

and

The Court does

Similarly, whether California
claim

based

on

the

improper

10

transfer of a home loan is not ripe for decision because nowhere

11

in the FAC do Plaintiffs allege that a loan ever existed or that

12

such a loan was improperly transferred. 5

13

extent that the Parties’ Motions are based on these theories, the

14

Motions are also DENIED IN PART.

Accordingly, to the

15
16

A.

Allegations Of The First Amended Complaint

17
18

Plaintiffs seek to quiet title to the property located at

19

1630

Holly

20

Plaintiffs allege that they “hold free and clear title to the

21

Property” and seek a declaration to that effect over “any and all

22

claims that might be asserted by any Defendant in this case.”

23

(Id. ¶ 16).

24

the

25

provision of corroborative evidence that it has some interest in

FAC

Avenue,

Oxnard,

California

93036.

(FAC

¶ 9).

With respect to the individually named Defendants,

alleges

that

“Defendant

BONYM

has

insinuated

without

26
27
28

5

Green Tree concedes in its MTD that Plaintiffs did not
“specifically allege[]” this theory of liability in their “‘bare
bones’ FAC.” (Green Tree MTD at 10).
13

1

the title of the Property that is adverse to Plaintiff’s [sic].”

2

(Id. ¶ 11).

3

of Doe Defendants Nos. 1 and 2, respectively, the FAC alleges

4

that “Defendants herein named as all persons unknown (‘DOES 1-

5

100’)

6

adverse

7

further allege:

As to Green Tree and BANA, substituted in the place

assert
to

interest

the

in

the

Plaintiff’s

title

[sic].”

of

the

(Id.

Property

¶ 14).

that

is

Plaintiffs

8
9

Plaintiffs

are

informed

and

believe,

and

thereon

10

allege,

that

11

herein,

known

12

title, estate, lien, or interest in the hereinafter

13

described property adverse to the Plaintiffs[’] title

14

and their claims, and each of them constitute a cloud

15

on Plaintiffs[’] title to that property.

each

of

and/or

the

Defendants

unknown[,]

claim

designate[d]
some

right,

16
17

(Id. ¶ 15).

Accordingly, Plaintiffs state that “[a] judicial

18

determination of the rights and responsibilities of the parties

19

over, to and about the Property is necessary and appropriate to

20

remove uncertainties that cloud the usefulness and enjoyment of

21

the Property.”

(Id. ¶ 19).

22
23

B.

Motion To Dismiss Standards

24
25

“[F]ederal courts sitting in diversity jurisdiction apply

26

state substantive law and federal procedural law.”

27

Ctr.

28

Accordingly, California law applies to Plaintiffs’ substantive

for

Humanities,

Inc.,

518

14

U.S.

415,

Gasperini v.
427

(1996).

1

state law claims and federal law governs the procedural aspects

2

of Defendants’ motions to dismiss.

3
4

A Rule 12(b)(6) motion to dismiss for failure to state a

5

claim should be granted if the plaintiff fails to proffer “enough

6

facts to state a claim to relief that is plausible on its face.”

7

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

8

has facial plausibility when the plaintiff pleads factual content

9

that allows the court to draw the reasonable inference that the

“A claim

10

defendant is liable for the misconduct alleged.”

11

Iqbal, 556 U.S. 662, 678 (2009).

12

provide

13

recitation of the elements of a cause of action will not do[,]”

14

Twombly, 550 U.S. at 555, “[s]pecific facts are not necessary;

15

the [complaint] need only give the defendant[s] fair notice of

16

what the . . . claim is and the grounds upon which it rests.”

17

Erickson

18

(citations and internal quotation marks omitted).

“more

v.

than

labels

Pardus,

551

and

U.S.

Ashcroft v.

Although the plaintiff must
conclusions,

89,

93

and

(2007)

a

(per

formulaic

curiam)

19
20

“When

ruling

on

a

motion

to

dismiss,

[the

Court]

may

21

generally consider only allegations contained in the pleadings,

22

exhibits attached to the complaint, and matters properly subject

23

to judicial notice.”

24

640

25

internal quotation marks omitted).

26

complaint’s allegations as true, Twombly, 550 U.S. at 555-56,

27

construe the pleading in the light most favorable to the pleading

28

party, and resolve all doubts in the pleader’s favor.

F.3d

948,

955

Colony Cove Props., LLC v. City of Carson,
(9th

Cir.

2011)

15

(citations,

footnote,

and

The court must accept the

Berg v.

1

Popham, 412 F.3d 1122, 1125 (9th Cir. 2005).

2

are “to be liberally construed” and are held to a less stringent

3

standard than those drafted by a lawyer.

4

94; see also Hebbe v. Pliler, 627 F.3d 338, 342 (9th Cir. 2010)

5

(“Iqbal incorporated the Twombly pleading standard and Twombly

6

did not alter courts’ treatment of pro se filings; accordingly,

7

we continue to construe pro se filings liberally when evaluating

8

them under Iqbal.”).

9

allegations contradicting documents that are referenced in the

Pro se pleadings

Erickson, 551 U.S. at

However, the court “need not accept as true

10

complaint or that are properly subject to judicial notice.”

11

Y Ranch Ltd. v. Behrens, 546 F.3d 580, 588 (9th Cir. 2006).

12

Likewise, “the tenet that a court must accept as true all of the

13

allegations contained in a complaint is inapplicable to legal

14

conclusions.”

Lazy

Iqbal, 556 U.S. at 678.

15
16

Dismissal for failure to state a claim can be warranted on

17

either a lack of a cognizable legal theory or the absence of

18

factual support for a cognizable legal theory.

19

Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008).

20

A complaint may also be dismissed for failure to state a claim if

21

it discloses some fact or complete defense that will necessarily

22

defeat the claim.

23

(9th Cir. 1984).

See Mendiondo v.

Franklin v. Murphy, 745 F.2d 1221, 1228-29

24
25

If the court finds that a complaint fails to state a claim,

26

it must also decide whether to grant the plaintiff leave to

27

amend.

28

amend should be granted unless the pleading could not possibly be

Even when a request to amend is not made, “[l]eave to

16

1

cured by the allegation of other facts, and should be granted

2

more liberally to pro se plaintiffs.”

3

1164, 1176 (9th Cir. 2005) (internal quotation marks omitted).

4

However, if amendment of the pleading would be futile, leave to

5

amend is properly denied. See Ventress v. Japan Airlines, 603

6

F.3d 676, 680 (9th Cir. 2010).

Lira v. Herrera, 427 F.3d

7
8

C.

Defendants’ Requests For Judicial Notice

9
10

The

FAC

affirmatively

repudiates

that

there

is

any

11

legitimate encumbrance on the property and does not make any

12

reference to money owed.

13

the Court to take judicial notice of a Deed of Trust recorded on

14

October 28, 2005, (BANA RJN Exh. A; Green Tree RJN Exh. 1); an

15

Assignment of Deed of Trust recorded on May 16, 2011, (BANA RJN

16

Exh. B; Green Tree RJN Exh. 4); and a Notice of Trustee’s Sale

17

recorded on November 26, 2013, all of which were recorded in the

18

Ventura County Recorder’s Office.

19

RJN Exh. 6).

20

various Substitution of Trustee forms, a Notice of Default, and a

21

Notice of Pendency of Action that were recorded in the Ventura

22

County Recorder’s Office, and a Limited Power of Attorney form

23

that

24

(Id., Exhs. 2-3, 5, 7-9).

was

However, both BANA and Green Tree ask

(BANA RJN Exh. C; Green Tree

In addition, Green Tree seeks judicial notice of

recorded

in

the

Maricopa

County

Recorder’s

Office.

25
26

Judicial notice is appropriate for “materials incorporated

27

into the complaint or matters of public record.”

28

v. Eisenberg, 593 F.3d 1031, 1038 (9th Cir. 2010); see also Fed.
17

Coto Settlement

1

R. Evid. 201.

2

recorded is not subject to reasonable dispute, BANA’s and Green

3

Tree’s respective RJNs are GRANTED to the extent that they seek

4

notice

5

documents.

6

truth of the matters asserted therein.”

7

Financial Corp., 2014 WL 4978437, at *1 n.1 (C.D. Cal. Oct. 6,

8

2014);

9

3467215, at *2 n.4 (C.D. Cal. July 9, 2013) (taking judicial

10

notice of Grant Deed and Deed of Trust as public records filed

11

with the County Recorder, but declining to “take judicial notice

12

of reasonably disputed facts contained within the judicially-

13

noticed documents”); Salcido v. Aurora Loan Services, 2012 WL

14

123280,

15

submitted a request for judicial notice of various public records

16

(e.g., Deed of Trust, Notice of Default, and Trustee’s Deed Upon

17

Sale)

18

judicial notice of such documents without converting this motion

19

to dismiss into a motion for summary judgment, but it cannot take

20

judicial

21

reasonably subject to dispute.”).

of

Because the fact that these public documents were

the

existence

and

recording

of

the

aforementioned

“The Court does not, however, accept them for the

see

at

also

*2

related

Edwards

(C.D.

to

notice

v.

Cal.

Wells

Jan.

Plaintiff’s

of

facts

Waldrup v. Countrywide

Fargo

17,

2012)

mortgage.

within

Bank,

such

N.A.,

2013

(“Defendants

The

Court

documents

may

that

WL

have

take

are

22
23

Defendants are advised that in any future motion, to the

24

extent they seek to establish that they are entitled to judgment

25

as a matter of law and wish to rely on matters outside the

26

pleadings, Defendants must comply with the requirements set forth

27

in Federal Rule of Civil Procedure 56 and this Court’s Local

28

Rules for a Motion for Summary Judgment.
18

1

D.

Discussion

2
3

The FAC, as amended by the substitution of BANA and Green

4

Tree for Doe Defendants Nos. 1 and 2, merely alleges that BANA

5

and

6

property,

7

Defendants have or had to the property or what kind of “adverse

8

interest”

9

required to put these Defendants on notice of Plaintiffs’ claims

Green

Tree

have

without

they

are

asserted

an

clarifying

allegedly

“adverse

what

interest”

relationship

attempting

to

assert.

in

those

the
two

More

is

10

against them.

11

Plaintiffs may contend in any amended complaint that BANA and

12

Green Tree are merely former or current trustees that serviced a

13

Deed of Trust on behalf of a creditor beneficiary, Plaintiffs are

14

cautioned that a plaintiff generally “cannot bring a quiet title

15

claim against [a trustee] because [the trustee] does not claim

16

any interest in the Property.”

17

2015 WL 794545, at *3 (C.D. Cal. Feb. 23, 2015).

18

the allegations in the FAC are not presently sufficient to state

19

a claim against BANA and Green Tree, Defendants have not shown

20

that Plaintiffs could not amend their claims to state a claim

21

against them by alleging, for example, that Defendants somehow

22

acted beyond the scope of their duties as trustees to Plaintiffs’

23

harm.

24

than

25

alia, substantive allegations against the trustee and claims for

26

money damages).

27

Tree’s Motions to Dismiss IN PART, and DISMISSES the FAC WITH

28

LEAVE TO AMEND.

(Id. at 15).

Furthermore, to the extent that

Vasquez v. Bank of America, N.A.,
However, while

See Perez, 929 F. Supp. 2d at 1002 (trustees may be “more
nominal

defendants”

where

the

complaint

includes,

inter

Accordingly, the Court GRANTS BANA’s and Green

19

1

The Court disagrees with BANA and Green Tree, however, to

2

the extent that they contend that the FAC fails to state a claim

3

because Plaintiffs have not alleged that Plaintiffs tendered the

4

amount owing on a loan secured by the property at issue.

5

California law, “a mortgagor of real property cannot, without

6

paying his debt, quiet his title against the mortgagee.”

7

v.

8

Plaintiffs allege that they “hold free and clear title to the

9

Property.”

Provost,

26

Cal.

App.

(FAC ¶16).

4th

1703,

1707

(1994).

Under

Miller
However,

Based solely on the allegations in the

10

FAC, there is no loan at issue, and even if there had been,

11

Plaintiffs’ contention that they hold “free and clear title” at

12

the

13

property.

14

tender argument raised by BONYM in BONYM’s motion for judgment on

15

the pleadings, “[T]here is nothing on the face of the [FAC] that

16

allows the court to determine that a mortgage is in play in this

17

case, a default has occurred by Plaintiffs or that any money is

18

owed at all on the property.

19

the tender rule come into play are simply not before the court at

20

this time.”

21

argument depends on the existence and non-payment of a loan, as

22

reflected in the contents of the recorded documents submitted for

23

judicial

24

contested

25

notice on a motion to dismiss.

26

Dismiss filed by BANA and Green Tree are DENIED IN PART to the

27

extent that they are based on Plaintiffs’ failure to plead tender

28

of a debt.

very

least

implies

the

satisfaction

of

any

debt

on

the

As the superior court held in rejecting the identical

(Warwick RJN, Exh. 2 at 4).

notice
and

The facts Defendant needs to make

by

are

BANA

and

therefore

RJN.
not

20

Defendants’ tender

However,

properly

those

subject

facts

to

are

judicial

Accordingly, the Motions to

1

Similarly, Green Tree’s contention that Plaintiffs fail to

2

state a claim because California allegedly does not authorize

3

borrowers to challenge the validity of subsequent transfers of

4

their loans also depends on facts (and indeed, legal theories)

5

not pled in the FAC.

6

grant a motion to dismiss.

7

consideration of disputed facts not pled in the FAC, Green Tree’s

8

Motion to Dismiss is DENIED IN PART on this ground as well.

As such, it, too, is not a proper ground to
Because this argument would require

9
10

IV.

11

CONCLUSION

12
13

Because diversity jurisdiction exists, Plaintiffs’ Motion to

14

Remand is DENIED.

15

Motion to Dismiss are each GRANTED IN PART and DENIED IN PART.

16

The Court concludes that the FAC, as amended by the substitution

17

of BANA and Green Tree for Doe Defendants Nos. 1 and 2, fails to

18

put these two Defendants on notice of the claims against them.

19

Accordingly,

20

Plaintiffs wish to pursue their claims, they shall file a Second

21

Amended Complaint within fourteen days after the date of the

22

settlement conference ordered by the Court as discussed at the

23

hearing.

the

BANA’s Motion to Dismiss and Green Tree’s

FAC

is

DISMISSED

WITH

LEAVE

TO

AMEND.

If

24
25

Plaintiffs

are

advised

that

pursuant

to

Federal

Rule

of

26

Civil Procedure 8(a), all that is required is a “short and plain

27

statement of the claim showing that the pleader is entitled to

28

relief.”

Plaintiffs

are

strongly
21

encouraged

to

keep

their

1

statements concise and to omit irrelevant details.

2

necessary

3

argument.

4

Defendants for which they lack a sufficient factual basis to

5

state a claim.

for

Plaintiffs

to

cite

case

law

or

It is not

include

legal

Plaintiffs are also advised to omit any claims or

6
7

Plaintiffs

are

cautioned

that

they

should

only

name

8

defendants in any amended complaint for which a plausible claim

9

for relief can be stated.

In the event Plaintiffs include claims

10

or defendants that have previously been dismissed as defective,

11

the

12

claims

13

judgment

14

responsible

15

Plaintiffs to avoid filing an amended complaint that repeats any

16

defective claims or wrongly includes improper defendants.

Court

cautions

or

Plaintiffs

defendants
is

entered
for

that

future

without

leave

against

Plaintiffs,

Defendants’

costs.

to

orders

amend.

Thus,

may

dismiss

Moreover,

they

may

the

Court

be

if

held

cautions

17
18

DATED:

July 17, 2015
/S/
__________
SUZANNE H. SEGAL
UNITED STATES MAGISTRATE JUDGE

19
20
21
22
23
24
25
26
27
28
22