Stein v. Bank of America, N.A., et al.,

Filing 44

ORDER signed by Judge Garland E. Burrell, Jr on 8/1/2011 re 38 ORDERING that Defendants 38 motion to dismiss is GRANTED. Plaintiff is granted fourteen (14) days from the date on which this order is filed to file a Third Amended Complaint addressing the deficiencies in the dismissed claims. Further, Plaintiff is notified that any dismissed claim not amended within this prescribed time period may be dismissed with prejudice under Federal Rule of Civil Procedure 41(b). (Duong, D)

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IN THE UNITED STATES DISTRICT COURT
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FOR THE EASTERN DISTRICT OF CALIFORNIA
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MARIA CHRISTINA STEIN, aka MARY
STEIN,
Plaintiff,

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v.

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BANK OF AMERICA, N.A., successor
in interest to Countrywide Bank,
FSB; MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC. aka
“MERS”,

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Defendants.
________________________________

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2:10-cv-02827-GEB-EFB
ORDER GRANTING DEFENDANTS’
MOTION TO DISMISS

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Defendants seek dismissal of Plaintiff’s misrepresentation and

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negligent misrepresentation claims, arguing these “two . . . fraud-based

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claims

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(“Rule”)] 9(b)’s heightened pleading standard.” (ECF No. 38; Mot. 1:13-

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14.) Plaintiff opposes the motion and seeks leave to amend if the motion

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is granted. (ECF No. 41.) For the following reasons, Defendants’ motion

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to dismiss is GRANTED.

fall

woefully

short

of

[Federal]

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Rule

[of

Civil

Procedure

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Plaintiff alleges in her Second Amended Complaint (“SAC”): she

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used Countrywide Bank, FSB for the purpose of refinancing her mortgage

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on September 12, 2007 (the “Current Loan”); “[o]n or about September 13,

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2007, [she] exercised her right to rescind the contract, and . . .

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rescind[ed] the contract by . . . executing Defendant’s cancellation

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form

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“[t]hereafter, Defendants recorded the Current Loan despite Plaintiff’s

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rescission[;]” she “became aware that the Current Loan was recorded, and

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expressed her rescission . . . again in a letter to Defendants dated

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October 17, 2007[;]” “Defendants have taken no effective steps to

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rescind

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represented that rescission was impossible[.]” (SAC ¶¶ 5-11, 14.)

pursuant

the

to

Defendant’s

Current

Loan[;]”

Notice

and

of

Right

“Defendant

.

.

to

.

Cancel[;]”

incorrectly

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Plaintiff’s misrepresentation and negligent misrepresentation

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claims are based solely on her allegations that “Defendant . . .

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incorrectly represented that rescission was impossible” and that this

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“representation was false[.]” Id. ¶¶ 35-36, 41-42.

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Defendants argue these claims should be dismissed because they

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fail to comply with Rule 9(b)’s heightened pleading standard. (Mot. 4:4-

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5:25.)

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differentiate between Defendants” and “fails to allege ‘the who, what,

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when, where, and how of the misconduct charged[.]’” Id. 5:12, 17-18.

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Plaintiff argues she has plead her misrepresentation and negligent

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misrepresentation claims with adequate specificity since she alleges

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“[t]he Defendant, Countrywide, wrongfully and incorrectly represented

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that rescission was impossible . . . in the fall of 2007 in Stanislaus

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County, California.” (Opp’n 4:17-20.) However, this is bare argument

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which does not accurately reflect allegations in Plaintiff’s SAC.

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///

Specifically,

Defendants

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contend

Plaintiff

“does

not

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To allege an actionable fraud claim in federal court the pled

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claim must satisfy Rule 9(b)’s heightened pleading requirements. See

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Vess v. Ciba-Geigy Corp., 317 F.3d 1097, 1103 (9th Cir. 2003). Rule 9(b)

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prescribes that “[i]n alleging fraud or mistake, a party must state with

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particularity

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Fed.R.Civ.P. 9(b). Therefore, a fraud claim must include “an account of

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the ‘time, place, and specific content of the false representations as

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well as the identities of the parties to the misrepresentations.’”

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Swartz v. KPMG LLP, 476 F.3d 756, 764 (9th Cir. 2007) (quoting Edwards

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v. Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir. 2004)). Rule 9(b)’s

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heightened pleading requirements also apply to Plaintiff’s negligent

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misrepresentation claim since this claim is “grounded in fraud [and is

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alleged] to sound in fraud.” Kearns v. Ford Motor Co., 567 F.3d 1120,

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1125 (9th Cir. 2009) (internal quotation marks omitted).

the

circumstances

constituting

fraud

or

mistake.”

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Since Plaintiff has failed to allege “the time, place, and

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specific content of the false representations as well as the identities

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of the parties to the misrepresentations” as required by Rule 9(b),

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Plaintiff’s misrepresentation and negligent misrepresentation claims are

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dismissed. Swartz, 476 F.3d at 764 (internal quotation marks omitted).

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Defendants argue this dismissal should be with prejudice since

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“Plaintiff cannot reasonably amend these claims to state a valid claim,

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as she cannot demonstrate reasonable reliance or damages.” (Mot. 1:14-

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15.)

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determine[d] that the pleading could not possibly be cured by the

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allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th

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Cir. 2000) (citation and internal quotation marks omitted). Since it is

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unclear whether the subject claims can be cured through amendment,

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Plaintiff is granted fourteen (14) days from the date on which this

However,

leave

to

amend

should

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be

granted

“unless

it

[is]

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order

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deficiencies in the dismissed claims. Further, Plaintiff is notified

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that any dismissed claim not amended within this prescribed time period

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may be dismissed with prejudice under Federal Rule of Civil Procedure

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41(b).

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Dated:

is

filed

to

file

a

Third

Amended

Complaint

addressing

August 1, 2011

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GARLAND E. BURRELL, JR.
United States District Judge

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the