Carlon et al v. Taylor, Bean and Whitaker Mortgage Corporation, et al

Filing 23

ORDER REMANDING CASE to Superior Court of CA, County of Sacramento signed by Judge John A. Mendez on 8/4/11. Certified copy of remand order sent to other court. CASE CLOSED (Kastilahn, A)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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JULIA M. CARLON, CHRISTINE M.
CARLON,

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Plaintiffs,
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v.
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TAYLOR, BEAN & WHITAKER MORTGAGE )
COMPANY, CENTRAL LOAN
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ADMINISTRATION AND REPORTING,
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OCWEN LOAN SERVICE, LLC, and
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DOES 1 through 100,
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Defendants.
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Case No. 2:11-CV-00499-JAM-GGH
REMAND ORDER

This matter comes before the Court on Defendants Central Loan

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Administration and Reporting (“CENLAR”) and OCWEN Loan Servicing,

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LLC’s (“OCWEN”) (collectively “Defendants”) Motion to Dismiss (Doc.

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#5) Plaintiffs Julia Carlon and Christine Carlon’s (collectively

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“Plaintiffs”) Complaint (Doc. #1, Exhibit A) pursuant to Federal

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Rule of Civil Procedure 12(b)(6).

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Defendants’ Motion to Expunge the Recorded Lis Pendens (Doc. #6),

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which includes a request for an award of attorneys’ fees and costs

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pursuant to California Code of Civil Procedure section 405.38.

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Also before the Court is

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Plaintiffs oppose both motions (Docs. #10, 11).1

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set forth below, Plaintiffs fail to state a claim for relief under

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Federal Law, depriving this Court of original jurisdiction.

For the reasons

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I.

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FACTUAL AND PROCEDURAL BACKGROUND

This action arises out of a residential mortgage taken out on

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Plaintiffs’ property, located at 4329 Figwood Way in Sacramento,

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California.

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(“Comp.”) at ¶ 2.

See Plaintiff’s Complaint, Doc. #1, Exhibit A
During 2009 and 2010, Defendants CENLAR and

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OCWEN began servicing Plaintiffs’ loan, which was originated by

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non-moving Defendant Taylor, Bean & Whitaker Mortgage Corporation,

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after Taylor Bean & Whitaker Mortgage Corporation suddenly rejected

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one of Plaintiffs’ mortgage payments.

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Plaintiffs were unable to contact Defendant CENLAR after it began

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servicing their loan, and therefore did not make loan payments

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between August 2009 and January 2010 because they did not know

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where to send their money.

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received a statement of the amount in arrears on their loan, they

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were unable to pay the total.

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unsuccessfully attempted to negotiate a modification of the

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obligation with Defendant OCWEN, which lead to the filing of this

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case.

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Id. at ¶¶ 2-8, 13-16.

Id. at ¶¶ 13-20.

When Plaintiffs

Id. at ¶¶ 20-21.

Plaintiffs

Id. at 20-26.

Defendants properly removed this case pursuant to 28 U.S.C.
section 1441, as Plaintiffs pled a cause of action in their

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This motion was determined to be suitable for decision without
oral argument. E.D. Cal. L.R. 230(g). The hearing was originally
scheduled for June 1, 2011.
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complaint under a federal statute, 12 U.S.C. section 2601.

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Doc.

#1.2

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II.

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A.

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Legal Standard
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OPINION

Federal Rule of Civil Procedure 12(b)(6)

A party may move to dismiss an action for failure to state a

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claim upon which relief can be granted pursuant to Federal Rule of

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Civil Procedure 12(b)(6).

In considering a motion to dismiss, the

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court must accept the allegations in the complaint as true and draw

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all reasonable inferences in favor of the plaintiff.

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Rhodes, 416 U.S. 232, 236 (1974), overruled on other grounds by

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Davis v. Scherer, 468 U.S. 183 (1984); Cruz v. Beto, 405 U.S. 319,

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322 (1972).

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are not entitled to the assumption of truth.

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129 S. Ct. 1937, 1950 (2009) (citing Bell Atl. Corp. v. Twombly,

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550 U.S. 544, 555 (2007)).

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plaintiff needs to plead “enough facts to state a claim to relief

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that is plausible on its face.”

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Dismissal is appropriate where the plaintiff fails to state a claim

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supportable by a cognizable legal theory.

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Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990).

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Scheuer v.

Assertions that are mere “legal conclusions,” however,
Ashcroft v. Iqbal,

To survive a motion to dismiss, a

Twombly, 550 U.S. at 570.

Balistreri v. Pacifica

Upon granting a motion to dismiss for failure to state a

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claim, the court has discretion to allow leave to amend the

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complaint pursuant to Federal Rule of Civil Procedure 15(a).

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Although Defendants’ removal may have been untimely, Plaintiffs
did not move to remand and thereby waived their right to challenge
the removal. More importantly, the removal was substantively
proper, and therefore the timeliness was not addressed sua sponte
by this Court at the time the case was removed.
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“Dismissal with prejudice and without leave to amend is not

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appropriate unless it is clear . . . that the complaint could not

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be saved by amendment.”

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316 F.3d 1048, 1052 (9th Cir. 2003).

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2.

Eminence Capital, L.L.C. v. Aspeon, Inc.,

Jurisdiction

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It is well settled that a court “ha[s] an independent

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obligation to address sua sponte whether [it] has subject-matter

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jurisdiction.”

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1025 (9th Cir.1999).

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See, e.g., Dittman v. California, 191 F.3d 1020,

Pursuant to 28 U.S.C. section 1441, “a defendant may remove an

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action filed in state court to federal court if the federal court

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would have original subject matter jurisdiction over the action.”

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Moore-Thomas v. Alaska Airlines, Inc., 553 F.3d 1241, 1243 (9th

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Cir. 2009).

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claim, it “shall have supplemental jurisdiction over all other

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claims that are so related to claims in the action . . . that they

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form part of the same case or controversy . . . .”

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1367(a).

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supplemental jurisdiction over a claim [] if: . . . (3) the

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district court has dismissed all claims over which it has original

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jurisdiction . . . ,” id. at § 1367(c), and it is appropriate to

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remand for lack of subject matter jurisdiction “at any time before

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final judgment . . . .”

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B.

When a district court has original jurisdiction over a

28 U.S.C. §

However, a court has discretion to “decline to exercise

Id. at § 1447(c).

Claims for Relief
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Federal Claim

Plaintiffs seek relief for a violation of 12 U.S.C. section

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2601, the Real Estate Settlement Procedures Act (“RESPA”).

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at ¶¶ 68-73.

Comp.

Plaintiffs allege Defendant CENLAR “fail[ed] to
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notify Plaintiffs of the assignment, sale, or transfer of the

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mortgage servicing rights relating to [their loan] at least fifteen

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(15) days before making that change . . . .”

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This transfer occurred sometime prior to January 18, 2010.

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¶¶ 20, 70, 72.

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conclusory allegations fail to state a claim upon which relief can

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be granted.

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Motion to Dismiss, Doc. #5, at pg. 9-10.

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do not plead actual damages which resulted from Defendant’s alleged

Id. at ¶¶ 70, 72.
Id. at

Defendants properly point out that Plaintiffs’

Defendants’ Points and Authorities in Support of their
Specifically, Plaintiffs

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violation of RESPA, a requirement to maintain a cause of action

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under RESPA.

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(N.D. Cal. Aug. 19, 2009).

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dismiss is granted, and Plaintiffs’ claim under RESPA is dismissed.

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See Singh v. Washington Mutual Bank, 2009 WL 2588885
Accordingly, Defendants’ motion to

Allowing amendment in this case would be futile.

Eminence

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Capital, L.L.C. v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir.

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2003).

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limitations, as the complaint was filed on January 18, 2011, and

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the last alleged violation of RESPA by Defendant CENLAR occurred 15

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days prior to January 18, 2010, at the latest, which was more than

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one year prior to the filing of Plaintiff’s complaint.

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2614; see also Levald, Inc. v. City of Palm Desert, 988 F.2d 680

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(9th Cir. 1993) (authorizing sua sponte dismissal of a complaint as

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time-barred by the statute of limitations).

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Plaintiffs’ RESPA claim is dismissed with prejudice.

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Plaintiffs’ claim is barred by RESPA’s one-year statute of

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12 U.S.C. §

Accordingly,

State Law Claims

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Plaintiffs assert six causes of action against Defendants

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under California law for breach of contract, breach of covenant of

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good faith and fair dealing, negligence, declaratory relief,
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violation of civil code section 2924, and violation of business and

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professions code section 17200.

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Plaintiffs’ only claim asserted against Defendant CENLAR under

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federal law has been dismissed without leave to amend.

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Additionally, on July 28, 2011, this Court issued an Order

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dismissing Plaintiffs’ claims against Defendant Taylor, Bean &

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Whitaker Mortgage Company, which included a claim under RESPA, due

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to Plaintiffs’ failure to timely serve their complaint.

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Therefore, Plaintiffs’ only federal claim in this case, which was

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See Comp.

As set forth above,

Doc. #22.

the basis for removal, has been dismissed as to all Defendants.
Pursuant to 28 U.S.C. section 1367, this Court exercises its

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discretion to decline supplemental jurisdiction over Plaintiffs’

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remaining claims, which all arise under state law.

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American Home Mortgage Servicing, Inc., 2010 WL 624306, at *1 (E.D.

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Cal. Feb. 18, 2010) (“In the usual case in which federal law claims

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are eliminated before trial, the balance of factors will point

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toward declining to exercise jurisdiction over the remaining state

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law claims.”) (internal citations omitted).

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Accord Keen v.

Accordingly, this Court will not address the merits of the
remaining issues raised in Defendants’ Motion to Dismiss.

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C.

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In light of this Court’s remand, Defendants’ Motion to Expunge

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Motion to Expunge

is dismissed without prejudice to re-file in state court.

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III. ORDER
For the reasons set forth above, the Court no longer has

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original jurisdiction over this action and declines to exercise

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supplemental jurisdiction over Plaintiff’s remaining state law
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claims.

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Superior Court of California, County of Sacramento.

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Accordingly, the Court REMANDS this action back to the

The Clerk shall close this case.

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IT IS SO ORDERED.

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Dated: August 4, 2011

____________________________
JOHN A. MENDEZ,
UNITED STATES DISTRICT JUDGE

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