Reinhard A. Tiefenthaler et al v. Wells Fargo Bank NA et al

Filing 35

ORDER by Judge Dean D. Pregerson: The court GRANTS Defendants motionto dismiss without prejudice 26 . Plaintiffs shall file a third amended complaint on or before August 19, 2011. Plaintiffs Request for Void Judgment Pursuant to FRCP 60 B(4) 28 ) is VACATED as moot, and Plaintiffs Petition to Postpone Ruling on Motion 32 is DENIED. (lc)

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UNITED STATES DISTRICT COURT

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CENTRAL DISTRICT OF CALIFORNIA

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REINHARD A. TIEFENTHALER et
al.,

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Plaintiffs,
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v.
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WELLS FARGO BANK NA et al.,
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Defendants.
__________________________

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Case No. ED CV 10-01722 DDP (OPx)
ORDER GRANTING DEFENDANTS’ MOTION
TO DISMISS FIRST AMENDED
COMPLAINT
[Motion filed on May 31, 2011
Term. Dkt. Nos. 26, 28, and 32]

This matter comes before the court on a Motion to Dismiss

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filed by Wells Fargo Bank, N.A. successor in interest by merger

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with Wachovia Mortgage, FSB and NDEX West L.L.C (“Defendants”).

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After reviewing the materials submitted by the parties and

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considering the arguments therein, the court GRANTS the motion and

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adopts the following Order.

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I.

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BACKGROUND
On October 2, 2008, Plaintiffs Reinhard and Margaret

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Tiefenthaler (“Plaintiffs”) obtained a loan from Wachovia, secured

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by a deed of trust against the subject property at 1309 E. Country

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Club Blvd., Big Bear City, California 92314 (the “Property”).

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(Wachovia’s Request For Judicial Notice in Support of Motion to

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Dismiss (“RJN”), Ex. A.)

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notice of default was recorded on June 29, 2010.

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October 4, 2010, a Notice of Trustee’s Sale was recorded noticing a

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trustee’s sale on October 26, 2010.

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2010, Plaintiffs brought suit against Defendants in state court,

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seeking to enjoin the foreclosure sale, damages for alleged fraud,

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and declaratory relief.

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October 26, 2010, the Trustee’s Sale took place and the property

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was sold. (RJN, Ex. D.) On November 8, 2010, Defendants removed the

Plaintiffs defaulted on their loan, so a
(RJN, Ex. B.)

On

(RJN, Ex. C.) On October 5,

(Complaint (“Compl.”) ¶¶ 66, 67, 78.)

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present action to this court based on diversity jurisdiction.

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(Notice of Removal ¶ 2.)

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dismiss Plaintiffs' complaint under Federal Rules of Civil

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Procedure 12(b)(6), 8, and 9(b).

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the motion with leave to amend. (Dkt. No. 21.)

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Plaintiffs filed their first amended complaint (“FAC”).

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24.)

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II.

On

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After removal, Defendants moved to

(Dkt. No. 7.)

This court granted
On May 12, 2011,
(Dkt. No.

LEGAL STANDARD
Under the Federal Rule of Civil Procedure 12(b)(6), a

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complaint is subject to dismissal when the plaintiff's allegations

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fail to state a claim upon which relief can be granted.

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

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claim, “all allegations of material fact are accepted as true and

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should be construed in the light most favorable to [the]

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plaintiff.”

When

Resnick v. Hayes, 213 F.3d 433, 447 (9th Cir. 2000).

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In Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009), the

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Supreme Court explained that a court considering a 12(b)(6) motion

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should first “identify[] pleadings that, because they are no more

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than conclusions, are not entitled to the assumption of truth.”
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Id.

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factual allegations, . . . assume their veracity and then determine

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whether they plausibly give rise to an entitlement to relief.”

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Id.; see also Moss v. U.S. Secret Serv., 572 F.3d 962, 969 (9th

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Cir. 2009) (“In sum, for a complaint to survive a motion to

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dismiss, the non-conclusory factual content, and reasonable

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inferences from that content, must be plausibly suggestive of a

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claim entitling the plaintiff to relief” (internal quotation marks

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omitted)).

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Next, the court should identify the complaint’s “well-pleaded

III. DISCUSSION

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A.

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Defendants seek to dismiss Plaintiffs’ claims for failure to

Rule 8

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comply with the pleading requirements under the Federal Rules of

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Civil Procedure.

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plain statement of the elements of his or her claim, identifying

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the transaction or occurrence giving rise to the claim and the

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elements of the prima facie case.”

Bautista v. Los Angeles County,

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216 F.3d 837, 840 (9th Cir. 2000).

It is well settled, for

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example, that a pleading may not simply allege a wrong has been

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committed and demand relief, but rather, must give “fair notice” of

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the claim being asserted and the “grounds upon which it rests.”

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Yamaguchi v. United States Dept. Of Air Force, 109 F.3d 1475, 1481

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(9th Cir. 1997).

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Rule 8 requires a plaintiff to “plead a short and

Here, even construing all allegations of material fact in

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Plaintiffs’ favor, Plaintiffs’ causes of action do not satisfy the

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minimal notice pleading requirements of Rule 8.

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lists statutes and definitions in support of their claims.

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9-28.)

Plaintiffs’ FAC
(FAC ¶¶

However, Plaintiffs have failed to identify any specific
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facts underlying Plaintiffs’ allegations as to the various

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statutory provisions pursuant to which Plaintiff bring suit.

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particular, Plaintiffs do not identify any particular conduct by

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Wachovia that violates the statutory provisions.

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of statutes and legal definitions does not constitute a claim.

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Such pleading does not give Defendants fair notice of the claim and

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the grounds upon which it rests.

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and conclusions are insufficient to withstand a motion to dismiss.

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See Bell Atlantic Corporation v. Twombly, 550 U.S. 544, 553-55

In

A mere recitation

Vague allegations and mere labels

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(2007).

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to state a claim upon which relief may be granted.

Accordingly, Plaintiffs’ claims are dismissed for failure

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B.

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Defendants next argue that the Home Owners’ Loan Act of 1933,

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12 U.S.C. § 1461 et seq.(“HOLA”)and regulations promulgated by the

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Treasury Department’s Office of Thrift Supervision (“OTS”), 12

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C.F.R. § 560, preempt Plaintiffs’ state law claims.

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Motion to Dismiss Plaintiffs’ First Amended Complaint, (“Def.’s

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Motion”) 4: 5-12.)

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prescribe a nationwide system of operation, supervision, and

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regulation which would apply to federal [savings] associations.”

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Glendale Fed. Sav. & Loan Ass’n v. Fox, 459 F. Supp. 903, 909 (C.D.

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Cal. 1978).

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§ 560.2(b), which provides for preemption of state laws that impose

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upon federal savings banks any requirements regarding “terms of

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credit, . . . [d]isclosure and advertising, . . . [or][p]rocessing,

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origination, servicing, sale or purchase of . . . mortgages.”

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C.F.R. § 560.2(b)(4,9-10).

Preemption

(Defendants’

Pursuant to HOLA, OTS is authorized “to

Acting under such authority, OTS promulgated 12 C.F.R.

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4

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In Silvas v. E*Trade Mortgage Corp., 514 F.3d 1001 (9th Cir.

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2008), the Ninth Circuit described HOLA as “so pervasive as to

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leave no room for state regulatory control.”

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(internal citation omitted).

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there has been a history of significant federal presence in

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national banking, the presumption against preemption of state law

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is inapplicable” in the banking context.

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(internal citation omitted).

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several claims under California’s Unfair Competition Law (“UCL”)

Id. at 1004-1005

The court explained that “because

Id. at 1004-1005

In Silvas, the plaintiffs brought

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related to a mortgage.

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because plaintiffs’ claims were “entirely based on [Defendant’s]

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disclosures and advertising,” the claims “[fell] within the

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specific type of law listed in § 560.2(b)(9),” and were therefore

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preempted. Id. at 1006 (emphasis in original).

Id. at 1003.

The Silvas court held that

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Here, Plaintiffs allege: “All of the Defendants have involved

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themselves in a conspiracy . . . [by] listing a non-beneficiary as

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beneficiary, using a State Notary to attest to signatures on

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different dates than the actual date of the signing of documents in

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different counties than the county where the document [sic] were

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signed, by claiming money was loaned when in actuality, assets were

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exchanged.”

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allege that Defendants do not have the right to foreclose on

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Plaintiffs’ property, are not the real parties in interest, and

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breached their agreement to loan money.

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argue that Plaintiffs’ allegations trigger one or more of HOLA’s

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regulations because they relate to lending, processing, and

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servicing policies of federal savings banks and their successors

(FAC 1: 26-28 - 2: 1-4.)

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Furthermore, Plaintiffs

(See FAC ¶ 7.)

Defendants

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and are therefore preempted.

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agrees.

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(Def.’s Motion 8: 13-15.)

The court

The court finds a comparison with Rivera v. Wachovia Bank,

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instructive.

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(S.D. Cal. Aug. 4, 2009).

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plaintiff’s allegations that Wachovia induced him to sign loan

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documents without adequate disclosures in regard to the interest

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rate and its adjustment over time in violation of state law were

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expressly the type of lending activity regulations Congress sought

Rivera v. Wachovia Bank, No. 09-0433, 2009 WL 2406301
In Rivera, the court found that

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to preempt.

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v. Wachovia Mortgage, the court ruled that the plaintiff’s state

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law based fraud, injunctive relief, and quiet title claims were

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expressly preempted by HOLA.

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1111182, No. 09-0377 (S.D. Cal. April 21, 2009).

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reasoning that:

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Rivera, 2009 WL 2406301 at *2.

Similarly, in Andrade

Andrade v. Wachovia Mortgage, 2009 WL
The Andrade court

Plaintiff’s
allegations
revolve
entirely
around the “processing, origination, [and]
servicing” of the Plaintiff’s mortgage,
including the “terms of credit” offered, the
“loan-related fees” charged, and the adequacy
of
disclosures
made
by
Defendants
in
soliciting and settling the loan. 12 C.F.R. §
560.2(b)(4), (9), (10).
Because the state
laws on which Plaintiff relies, as applied,
would regulate lending activities expressly
contemplated by § 560.2(b), the claims are
preempted.

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Andrade, 2009 WL 1111182 at *3.
In the present action, Plaintiffs’ claims are difficult to

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discern and are not pled with particularity.

However, it appears

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that Plaintiffs broadly assert that Defendants engaged in fraud in

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the initial disclosure, origination, and servicing of Plaintiffs’

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mortgage.

In support of their claims, Plaintiffs cite the UCL §
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17200, which appears to be the entire grounds for related relief.

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The court must resolves any doubt in favor of preemption.

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Washington Mutual Bank, 147 Cal. App. 4th 72, 77 (2007).

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extent that Plaintiffs’ state law claims for fraud relate to the

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“processing,” “disclosure,” “origination,” and/or “sale or purchase

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of” their mortgage, they are preempted and therefore dismissed.

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C.F.R. § 560.2(b)(10).

Weiss v.
To the

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C.

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Defendants move to dismiss any declaratory relief based on the

Declaratory Relief

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failure to identify specific grounds for relief.

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determination of whether Defendants have a right to a non-judicial

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foreclosure action and whether false documents were used.

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7.)

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the Declaratory Judgment Act (“DJA”), 28 U.S.C. § 2201, which

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permits a district court to hear declaratory actions.

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procedural only.

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Haworth, 300 U.S. 227, 240.

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district court to “inquire whether there is a case of actual

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controversy within its jurisdiction.”

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Kearns, 15 F.3d 142, 143-44 (9th Cir. 1994).

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relation to the various causes brought by Plaintiffs, the court is

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not persuaded that there is an actual controversy, and accordingly

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Defendants’ motion to dismiss Plaintiffs’ request for declaratory

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relief is granted.

Plaintiffs seek a

(FAC ¶

Plaintiffs’ declaratory relief is subject to the provisions of

The DJA is

Aetna Life Ins. Co. of Hartford, Conn. V.
Furthermore, a DJA action requires a

American States Ins. Co. v.
Here, as discussed in

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D.

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“When a debtor is in default of a home mortgage loan, and a

Tender

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foreclosure is either pending or has taken place, the debtor must

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allege a credible tender of the amount of the secured debt to
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maintain any cause of action for wrongful foreclosure.”

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GE Money Bank, 2009 WL 2136969 *3 (N.D. Cal. July 16, 2009).

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order to enjoin or set aside a foreclosure sale, the debtor must

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make a valid and viable tender of the indebtedness.

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Karlsen v. American Savings & Loan Ass’n, 15 Cal. App. 3d 122, 117

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(1971)).

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owing is essential to an action to cancel a voidable sale under a

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deed of trust.

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could not have redeemed the property had the sale procedures been

Alicea v.
In

Id. (citing

A valid and viable tender of payment of the indebtedness

The rationale behind the rule is that if plaintiffs

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proper, any irregularities in the sale did not result in damages to

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the plaintiffs.

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981676 at *5 (E.D. Cal. Apr. 9, 2009).

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deficient, Plaintiffs’ failure to plead tender of the indebtedness

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eliminates a challenge to the foreclosure process.

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complaint that does not allege such a tender does not state a cause

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of action.

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App. 4th 388 (2005).

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Lopez v. Chase Home Fin. LLC, No. 09-0449, 2009 WL
Thus even if notices were

In fact, a

McElroy v. Chase Manhattan Mortgage Corp., 134 Cal.

As noted above, Plaintiffs’ claims are difficult to discern

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and are not pled with particularity.

Here, because it appears that

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Plaintiffs have failed to tender, which is a condition preccedent

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to any claim for wrongful foreclosure, the court grants Defendants’

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motion.

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E.

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Defendants also move to dismiss Plaintiffs’ fraud claims on

Fraud

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the grounds that the claims are not pled with the specificity

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required by Rule 9(b).

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has held that “when averments of fraud are made, the circumstances

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constituting the alleged fraud” must “be specific enough to give

Fed. R. Civ. P. 9(b).

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The Ninth Circuit

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defendants notice of the particular misconduct,” thereby enabling

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them to “defend against the charge and not just deny that they have

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done anything wrong.”

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1106 (9th Cir. 2003) (internal quotation marks and citations

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omitted).

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‘the who, what, when, where, and how’ of the misconduct charged.”

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Id. (quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997)

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(internal quotation marks omitted)).

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not allege that Defendants made any specific misrepresentations

Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097,

Therefore, averments of fraud “must be accompanied by

In their FAC, Plaintiffs do

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that induced them to enter into the loan transaction.

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Plaintiffs assert general allegations without any specification of

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misconduct.

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pleaded with sufficient particularity to satisfy Rule 9(b).

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Therefore, Defendants are entitled to dismissal of Plaintiffs’

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fraud claims on the grounds that the claims are not pled with the

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specificity required by Rule 9(b).

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(FAC 1:26-28, 2:1-4.)

Rather,

These allegations are not

Moreover Plaintiffs assert that “[a]ll of the Defendants have

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involved themselves in a conspiracy.”

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legal doctrine that only operates where an actual tort has been

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committed.

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Cal. 4th 503, 511 (1994).

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separate and distinct cause of action for civil conspiracy.

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Entertainment Research Group, Inc. v. Genesis Creative Group, Inc.,

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122 F.3d 1211, 1228 (9 th Cir. 1997).

(FAC 1.)

Conspiracy is a

Applied Equipment Corp. v. Litton Saudi Arabia Ltd., 7
Under California law, there is no

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III. CONCLUSION
For the foregoing reasons, the court GRANTS Defendants’ motion

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to dismiss without prejudice.

Plaintiffs shall file a third

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amended complaint on or before August 19, 2011.

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Request for Void Judgment Pursuant to FRCP 60 B(4) (Dkt. No. 28) is

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VACATED as moot, and Plaintiffs’ Petition to Postpone Ruling on

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Motion (Dkt. No. 32) is DENIED.

Plaintiffs’

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IT IS SO ORDERED.
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Dated: July 19, 2011
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DEAN D. PREGERSON
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United States District Judge
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