Nelson Velasco v. Homewide Lending Corp et al

Filing 6

(IN CHAMBERS) ORDER TO SHOW CAUSE WHY THIS CASE SHOULD NOT BE DISMISSED FOR FAILURE TO STATE A CLAIM by Judge Cormac J. Carney. (See document for details.) Accordingly, the Court ORDERS Mr. Velasco to show cause why this case should not be dismissed for failure to allege any cognizable claim. Mr. Velasco shall file an opposition to the Courts order to show cause by May 21, 2013. Defendants shall have until May 28, 2013 to file a response. This matter will be decided on the papers without any hearing. (rla)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 13-00698-CJC(MRWx)

Date: May 7, 2013

Title: NELSON VELASCO v. HOMEWIDE LENDING CORP., ET AL.

PRESENT:
HONORABLE CORMAC J. CARNEY, UNITED STATES DISTRICT JUDGE
Michelle Urie
Deputy Clerk
ATTORNEYS PRESENT FOR PLAINTIFF:

None Present

N/A
Court Reporter
ATTORNEYS PRESENT FOR DEFENDANT:

None Present

PROCEEDINGS: (IN CHAMBERS) ORDER TO SHOW CAUSE WHY THIS
CASE SHOULD NOT BE DISMISSED FOR FAILURE TO STATE A CLAIM
On April 1, 2013, pro se Plaintiff Nelson Velasco filed this action against
Defendants Homewide Lending Corp. (“Homewide”), Aurora Loan Services, LLC
(“Aurora”), Nationstar Mortgage, LLC, and Mortgage Electronic Registration Systems,
Inc. (collectively, “Defendants”) asserting several causes of action related to the property
at 5043 Evergreen Ave, Cypress, CA (the “Subject Property”). Mr. Velasco alleges that
he purchased the Subject Property after obtaining an adjustable rate loan from
Homewide. The mortgage was securitized, after which Aurora became the servicer of the
loan. The Subject Property was sold at a Trustee’s Sale on November 14, 2011, and an
unlawful detainer action was brought against Mr. Velasco on February 8, 2012. Mr.
Velasco seeks injunctive relief to prevent Defendants from taking possession of the
Subject Property. He also brings claims for (1) violation of the Truth in in Lending Act
(“TILA”); (2) violation of the Real Estate Settlement Procedures Act; (3) violation of the
Rosenthal Act; (4) quiet title; (5) wrongful foreclosure; (6) slander of title; (7) civil
conspiracy; (8) unfair business practices; (9) imposition of constructive trust; (10) fraud;
and (11) securitization of mortgage loans. Based upon a review of the Complaint, it
appears that Mr. Velasco fails to state a claim upon which relief can be granted.
Most of Mr. Velasco’s claims are premised on allegations that Defendants
fraudulently foreclosed on the Subject Property. A plaintiff alleging fraud or mistake
must “state with particularity the circumstances constituting fraud or mistake,” Fed. R.

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 13-00698-CJC(MRWx)

Date: May 7, 2013
Page 2

Civ. P. 9(b), including the “who, what, when, where, and how” of the alleged fraud. Vess
v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003). “To allege fraud with
particularity, a plaintiff . . . must set forth what is false or misleading about a statement,
and why it is false.” Glen Holly Entm’t, Inc. v. Tektronix, Inc., 100 F. Supp. 2d 1086,
1094 (C.D. Cal. 1999). Here, Mr. Velasco’s allegations are wholly conclusory, and lack
the necessary factual basis to satisfy Rule 9(b). For example, Mr. Velasco alleges that
“Defendants misrepresented the facts intending to force Plaintiff to either pay large sums
of money to Defendants to which they were not entitled, or to abandon the Property to
foreclosure sale, to Defendants’ profit.” (Dkt. No. 1 [Compl.] at 8.) Mr. Velasco fails to
allege with any specificity what facts were misrepresented, when the misrepresentations
were made, how the misrepresentations are false, and which specific Defendants made
the misrepresentations.
Mr. Velasco’s Complaint suffers from a number of other problems. For example,
he brings a claim for violation of California’s Rosenthal Fair Debt Collection Practices
Act. However, “foreclosure pursuant to a deed of trust does not constitute debt collection
under the [Rosenthal Act].” Sipe v. Countrywide Bank, 690 F. Supp. 2d 1141, 1151 (E.D.
Cal. 2010) (quotes omitted). Additionally, it appears that Mr. Velasco’s TILA claim is
time barred. TILA permits injured plaintiffs to seek damages or rescission. An
individual must bring claims for damages within one year of the violation, 15 U.S.C. §
1640(e), and the right to rescind “expire[s] three years after the date of consummation of
the transaction or upon the sale of the property, whichever occurs first,” 15 U.S.C. §
1635(f). Mr. Velasco filed this action more than three years after the consummation of
the loan.
Accordingly, the Court ORDERS Mr. Velasco to show cause why this case
should not be dismissed for failure to allege any cognizable claim. Mr. Velasco shall file
an opposition to the Court’s order to show cause by May 21, 2013. Defendants shall
have until May 28, 2013 to file a response. This matter will be decided on the papers
without any hearing.

mtg
MINUTES FORM 11
CIVIL-GEN

Initials of Deputy Clerk MU