Lystad et al v. SunTrust Mortgage, Inc.

Filing 23

ORDER GRANTING 19 Plaintiff's motion for leave to file second amended complaint; ORDER MOOTING 17 Defendant's motion to dismiss Plaintiffs' first amended complaint, signed by Magistrate Judge Sheila K. Oberto on 8/21/2011. (Timken, A)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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JOHN LYSTAD, et al.,

CASE NO. 11-cv-00655-SKO

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Plaintiffs,

ORDER GRANTING PLAINTIFFS’
MOTION FOR LEAVE TO FILE
SECOND AMENDED COMPLAINT

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v.
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SUNTRUST MORTGAGE, INC.,

(Docket No. 19)

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Defendant.
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ORDER MOOTING DEFENDANT’S
MOTION TO DISMISS PLAINTIFFS’
FIRST AMENDED COMPLAINT

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(Docket No. 17)
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I.

INTRODUCTION

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On July 25, 2011, Defendant Suntrust Mortgage, Inc. (“Defendant”) filed a motion to dismiss

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and strike portions of Plaintiffs John Lystad and Karen Lystad’s (collectively, “Plaintiffs”) first

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amended complaint, and sought a more definite statement concerning Plaintiffs’ claims. (Doc. 17.)

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On August 17, 2011, Plaintiffs filed a response to Defendant’s motion to dismiss and a motion for

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leave to file a second amended complaint. (Docs. 18, 19.) Plaintiffs state that they have obtained

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written consent from Defendants allowing for amendment of the complaint, and request that the

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Court grant them leave to file a second amended complaint. (Doc. 19, 1:19-2:9.)

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For the reasons set forth below, the parties’ stipulated request that Plaintiffs be permitted to

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file a second amended complaint is GRANTED. Defendant’s motion to dismiss is thus MOOT.

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Accordingly, the Court VACATES the hearing scheduled for August 31, 2011.

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II.

PROCEDURAL BACKGROUND

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On January 7, 2011, Plaintiffs filed for Chapter 13 bankruptcy in bankruptcy case no.

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11-10201-B-13, and Defendant filed its creditor claim for $538,220.09 with an arrearage of

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$49,540.41. (Doc. 1. 4:2-9; Doc. 5, 2:20-21.) On March 23, 2011, Plaintiffs filed a complaint

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against Defendant in the bankruptcy proceeding, objecting to the amount sought by Defendant. On

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April 27, 2011, Defendant filed a motion to withdraw the bankruptcy reference so as to transfer the

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federal and California claims to this Court, asserting that those claims are “non-core” bankruptcy

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claims and that bankruptcy withdrawal would promote efficiency (Doc. 1.) On May 16, 2011,

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District Judge Lawrence J. O’Neill issued an order granting Defendant’s motion to withdraw the

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bankruptcy reference and exercised the Court’s jurisdiction over Plaintiffs’ federal and California

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causes of action. (Doc. 5.)

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On June 2, 2011, Defendant filed a motion to dismiss, which the Court granted in part and

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denied in part on July 6, 2011. (Docs. 8, 15.) On July 11, 2011, Plaintiffs filed a first amended

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complaint, alleging causes of action for (1) objection to claim and request for determination of claim

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under 11 U.S.C. § 502 (Plaintiffs indicated that this claim remains with the bankruptcy court);

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(2) breach of contract; (3) violation of Truth in Lending Act and Implementary Regulation Z

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(Plaintiffs indicated that this claim was withdrawn); (4) violation of California Predatory Lending

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Act; (5) fraud, fraudulent concealment and negligent misrepresentation; (6) duress; (7) emotional

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distress; (8) violation of California Business & Professions Code § 17200; and (9) violation of Fair

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Credit Reporting Act (Plaintiffs indicated that this claim was withdrawn). (Doc. 16.)

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On July 25, 2011, Defendant filed this instant motion to dismiss, seeking dismissal of

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Plaintiffs’ fourth cause of action for violation of California Predatory Lending Act and eighth cause

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of action for violation of California Business and Professions Code § 17200, as well as seeking a

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more definite statement as to the other claims. (Doc. 17.) On August 17, 2011, Plaintiffs filed a

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response to Defendant’s motion to dismiss and a motion for leave to file a second amended

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complaint. (Docs. 18, 19.)

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III.

DISCUSSION

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Plaintiffs seek leave to file an amended complaint pursuant to Federal Rule of Civil

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Procedure 15(a)(2), which provides in pertinent part that a party may amend its pleadings “with the

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opposing party’s written consent or the court’s leave. The court should freely give leave when

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justice requires.”

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Here, Defendant’s counsel provided written consent on behalf of his client to allow Plaintiff

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leave to file a second amended complaint. (Doc. 19, 2:16-24.) Plaintiffs indicate that “the parties

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believe it would be in the best interest of judicial economy” to allow for an amended complaint

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“rather than have the Court decide the current issues.” (Doc. 18, 1:21-24.) Plaintiffs further state

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that “[i]t is in the best interest of all parties involved to allow this amendment.” (Doc. 19, 2:2-3.)

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Based on the agreement of the parties, the Court GRANTS Plaintiffs’ motion for leave to file

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a second amended complaint. Plaintiffs’ second amended complaint shall be filed on or before

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August 31, 2011, the date requested by Plaintiffs. Defendant’s motion to dismiss is thus MOOT.

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IV.

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Accordingly, IT IS HEREBY ORDERED that:

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Plaintiffs’ motion for leave to file a second amended complaint is GRANTED;

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2.

Defendant’s motion to dismiss is MOOT; and

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3.

Plaintiffs shall file a second amended complaint on or before August 31, 2011.

CONCLUSION AND ORDER

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IT IS SO ORDERED.

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Dated:
ie14hj

August 21, 2011

/s/ Sheila K. Oberto
UNITED STATES MAGISTRATE JUDGE

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