Kouretas v. Nationstar Mortgage Holdings, Inc. et al
Filing
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MEMORANDUM, OPINION and ORDER; denying 4 Motion for TRO. Accordingly, the 12/27/2013 Motion Hearing is vacated. Signed by Chief Judge Morrison C. England, Jr. on 12/26/2013. (Deutsch, S)
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UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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JAMES KOURETAS,
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Plaintiff,
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No. 2:13-cv-2632-MCE-KJN
v.
MEMORANDUM AND ORDER
NATIONSTAR MORTGAGE
HOLDINGS, INC., et al.,
Defendant.
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On December 20, 2013, Plaintiff James Kouretas (“Plaintiff”) filed the instant
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action against Defendants Nationstar Mortgage Holdings, Inc. and Bank of America,
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N.A., (“Defendants”). Compl., ECF No. 1. On December 23, 2013, Plaintiff filed a
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Motion for Temporary Restraining Order (“TRO”) seeking to stop the impending
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foreclosure sale of a property owned by Plaintiff. Mot., ECF No. 4. For the reasons set
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forth below, Plaintiff’s Motion for TRO is DENIED.1
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Because oral argument would not be of material assistance, this matter is submitted on the
briefs. E.D. Cal. Local Rule 230(g).
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BACKGROUND2
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Plaintiff holds title to the property known as 3324 S Street, Sacramento,
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California, 95816. The property was first secured by a deed of trust in favor of Bank of
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America. In November 2013, Nationstar Mortgage Holdings became the loan servicer.
In May 2013, Plaintiff wrote to Bank of America to request a loan modification. A
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Bank of America representative responded, stating that the bank had received his
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request and was transferring the request to a specialist. Plaintiff was told the bank
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would contact Plaintiff within fifteen days. Then, eight days later, Bank of America
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recorded and served Plaintiff with a notice of trustee’s sale. However, in June 2013,
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Bank of America wrote to Plaintiff, stating that his loan modification request had been
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forwarded to a specialist. Then, a week later, Bank of America sent Plaintiff a Notice of
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Intent to Accelerate, threatening to accelerate repayment of the full amount of the note
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despite the fact that Plaintiff’s loan was being evaluated for a loan modification.
In July 2013, Plaintiff completed and again submitted loan modification papers to
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Bank of America. Bank of America sent a letter stating that Plaintiff was being
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considered for a short sale. Thereafter, Bank of America sent another letter to Plaintiff,
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acknowledging receipt of Plaintiff’s request for a loan modification and stating that the
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request was forwarded to a specialist in the appropriate department. However, on
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August 1, 2013, Bank of America recorded a notice of default. Then, on September 3,
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2013, Bank of America recorded a second notice of default. Later in September,
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multiple Bank of America representatives wrote to Plaintiff, stating that they would
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“continue the work [Plaintiff] started” with Plaintiff’s previous points of contact at the
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bank.
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The following recitation of facts is taken, at times verbatim, from Plaintiff’s Memorandum of
Points and Authorities in Support of Motion for TRO. ECF No. 5.
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Finally, in October 2013, Bank of America informed Plaintiff that they would not
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modify Plaintiff’s loan. Thereafter, Plaintiff’s loan servicing was transferred to Nationstar.
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Nationstar wrote to Plaintiff in November 2013, informing Plaintiff that Nationstar wanted
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to help Plaintiff stay in his home. Nonetheless, in December 2013, Plaintiff received a
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notice of trustee sale, which is scheduled to take place on Monday, December 30, 2013.
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STANDARD
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The purpose of a temporary restraining order is to preserve the status quo
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pending the complete briefing and thorough consideration contemplated by full
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proceedings pursuant to a preliminary injunction. See Granny Goose Foods, Inc. v.
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Teamsters, 415 U.S. 423, 438-39 (1974) (temporary restraining orders “should be
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restricted to serving their underlying purpose of preserving the status quo and preventing
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irreparable harm just so long as is necessary to hold a hearing, and no longer”); see also
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Reno Air Racing Ass’n., Inc. v. McCord, 452 F.3d 1126, 1131 (9th Cir. 2006); Dunn v.
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Cate, No. CIV 08-873-NVW, 2010 WL 1558562, at *1 (E.D. Cal. April 19, 2010).
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Issuance of a temporary restraining order, as a form of preliminary injunctive
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relief, is an extraordinary remedy, and Plaintiffs have the burden of proving the propriety
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of such a remedy. See Mazurek v. Armstrong, 520 U.S. 968, 972 (1997). In general,
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the showing required for a temporary restraining order and a preliminary injunction are
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the same. Stuhlbarg Int’l Sales Co., Inc. v. John D. Brush & Co., Inc., 240 F.3d 832, 839
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n.7 (9th Cir. 2001).
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The party requesting preliminary injunctive relief must show that “he is likely to
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succeed on the merits, that he is likely to suffer irreparable harm in the absence of
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preliminary relief, that the balance of equities tips in his favor, and that an injunction is in
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the public interest.” Winter v. Natural Resources Defense Council, 555 U.S. 7, 20
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(2008); Stormans, Inc. v. Selecky, 586 F.3d 1109, 1127 (9th Cir. 2009) (quoting Winter).
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To grant preliminary injunctive relief, a court must find that “a certain threshold showing
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is made on each factor.” Leiva–Perez v. Holder, 640 F.3d 962, 966 (9th Cir. 2011).
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The propriety of a TRO hinges on a significant threat of irreparable injury that must be
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imminent in nature. Caribbean Marine Serv. Co. v. Baldridge, 844 F.2d 668, 674 (9th
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Cir. 1988).
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Alternatively, under the so-called sliding scale approach, as long as the Plaintiffs
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demonstrate the requisite likelihood of irreparable harm and show that an injunction is in
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the public interest, a preliminary injunction can still issue so long as serious questions
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going to the merits are raised and the balance of hardships tips sharply in Plaintiffs’
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favor. Alliance for Wild Rockies v. Cottrell, 632 F.3d 1127, 1131-36 (9th Cir. 2011)
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(concluding that the “serious questions” version of the sliding scale test for preliminary
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injunctions remains viable after Winter).
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ANALYSIS
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Here, Plaintiff has failed to show a likelihood of success on the merits. Plaintiff
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asserts that he is entitled to relief under to the California Homeowner Bill of Rights, Cal.
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Civ. Code § 2923.6(b). The California Homeowner Bill of Rights went into effect on
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January 1, 2013, and it offers homeowners greater protection during the foreclosure
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process. Id. Section 2923.6(b) states “it is the intent of the legislature that the mortgage
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servicer offer the borrower a loan modification or work out a plan if such a modification or
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plan is consistent with its contractual or other authority.”
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The statute further provides that “if a borrower submits a complete application for a first
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lien loan modification . . . the mortgage servicer . . . shall not record a notice of default or
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notice of sale, or conduct a trustee's sale, while the complete first lien loan modification
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application is pending.” Id. § 2923.6(c). Plaintiff alleges that Defendants violated the
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California Homeowner Bill of Rights by engaging in “dual tracking,” or negotiating with
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Plaintiff for a loan modification while simultaneously advancing the foreclose process.
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Importantly, however, the California Homeowner Bill of Rights applies only to “first
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lien mortgages or deeds of trust that are secured by owner-occupied residential real
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property containing no more than four dwelling units. For these purposes, ‘owner
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occupied’ means that the property is the principal residence of the borrower . . . .” Cal.
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Civ. Code. § 2924.15(a). Plaintiff’s Motion for TRO makes no allegations, nor provides
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any evidence, that the property at issue is his principal residence. Rather, Plaintiff states
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that he “holds title to the property.” Mot. at 2. On December 23, 2013, the Court issued
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an order requiring Plaintiff to respond in writing whether the property in question is
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owner-occupied residential real property. Order, ECF No. 10. Plaintiff filed a response
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which states that “Plaintiff . . . does utilize a different address from the subject property of
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this suit as his primary residence.” Response, ECF No. 11.
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Accordingly, the Court finds that Plaintiff has no likelihood of success on the
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merits, as Plaintiff cannot meet this requirement of stating a claim for dual tracking under
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the California Homeowner Bill of Rights. Plaintiff has therefore failed to show that the
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first prong of Winters is met. Moreover, Plaintiff has failed to adequately demonstrate to
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the Court that the irreparable harm which Plaintiff claims he will suffer is sufficient to
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warrant the drastic relief of a TRO. Plaintiff alleges only that he will be foreclosed out of
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his home in which he does not reside. Mot. at 5. Such harm is not adequate to warrant
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the issuance of a TRO, given the circumstances of this case.
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Plaintiff’s Motion for TRO, ECF No. 4, is therefore DENIED.
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IT IS SO ORDERED.
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Dated: December 26, 2013
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