Farren et al. v. Select Portfolio Servicing, Inc. et al.
Filing
42
ORDER signed by District Judge John A. Mendez on 3/17/17 ORDERING that Defedants' MOTION to DISMISS is GRANTED and the case is DISMISSED WITH PREJUDICE. CASE CLOSED. (Mena-Sanchez, L)
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UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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BETTINA L. FARREN; STEVE
FARREN,
No.
2:16-cv-01077-JAM-DB
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Plaintiffs,
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ORDER GRANTING DEFENDANTS’
MOTION TO DISMISS SECOND AMENDED
COMPLAINT
v.
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SELECT PORTFOLIO SERVICING,
INC.; US BANK AS TRUSTEE ON
BEHALF OF THE HOLDERS OF THE
WAMU MORTGAGE PASS-THROUGH
CERTIFICATES SERIES 2007-HY6;
JPMORGAN CHASE BANK, N.A.;
QUALITY LOAN SERVICE
CORPORATION; and Does 1
through 50, inclusive,
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Defendants.
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This matter is before the Court on Select Portfolio
23
Servicing, Inc.’s and US Bank as Trust on behalf of the holders
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of the WaMu Mortgage Pass-Through Certificates, Series 2007-HY6’s
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(collectively “Defendants”) Motion to Dismiss.
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and Steve Farren (“Plaintiffs”) sued Defendants for various
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claims connected to the mortgage secured by their residence.
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the reasons explained below, the Court grants Defendants’ Motion
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Bettina L. Farren
For
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to Dismiss with prejudice. 1
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I.
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FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND
The following allegations are taken as true for the purposes
of this motion:
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On March 23, 2007, Plaintiffs executed a Deed of Trust
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(“DOT”) in favor of Washington Mutual Bank, FA, securing a loan
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of $1,464,000 with their property located at 2045 Salmon Falls
9
Road, El Dorado Hills, CA 95862 (“Property”).
Second Amended
10
Complaint (“SAC”) at ¶¶ 2, 12; see DOT, SAC at Exh. 1.
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defined the “Borrower” as “Steven Farren and Bettina L. Farren,
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husband and wife and Stephen R. Hinrichs and Janine G. Hinrichs,
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husband and wife by deed which recites ‘as to an undivided 50%
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interest, all as tenants in common[.]’”
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signed and executed an Adjustable Rate Note (“Note”) concurrently
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with the Deed of Trust; however, Plaintiffs do not have a copy of
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the Note they signed.
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retain a copy of either document but subsequently obtained a copy
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of the Deed of Trust, which was recorded at the County Recorder’s
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office.
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of an Adjustable Rate Note signed by only Stephen R. Henrichs and
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Janine G. Henrichs, not the Farrens.
23
Additionally, Plaintiffs executed a Fixed/Adjustable Rate Rider
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and a Second Home Rider, which they also have signed copies of
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and on which Plaintiffs are listed as Borrowers.
SAC at ¶ 19.
SAC at ¶ 12, 19.
DOT at 1.
The DOT
Plaintiffs
Plaintiffs did not
Plaintiffs provide the Court with a copy
SAC at Exh. 8.
SAC at ¶ 12;
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1
This motion was determined to be suitable for decision without
oral argument. E.D. Cal. L.R. 230(g). The hearing was
scheduled for February 7, 2017.
2
1
Exh. 2, 3.
2
acknowledge that the Property is a Second Home to the Henrichs.
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SAC at ¶ 44.
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residence.
5
Plaintiffs executed the Second Home Rider to
Plaintiffs claim that the home was their primary
Id.; SAC at ¶ 9.
At some point after that transaction, but before December 8,
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2008, Chase became the successor to Washington Mutual Bank, FA.
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SAC at ¶ 20.
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Default to be issued against the Property.
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same day, Chase assigned the Deed of Trust and Note to LaSalle
Then, on December 8, 2008, Chase caused a Notice of
SAC at ¶ 21.
On the
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Bank NA as trustee for WaMu Mortgage Pass-Through Certificates,
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Series 2007—HY6.
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LaSalle Bank in interest as trustee for the WaMu Mortgage Pass-
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Through Certificates.
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servicer of the loan throughout these transfers until, at a date
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unknown to Plaintiffs, Select Portfolio Servicing, Inc. (“SPS”)
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became the servicer. Id. at ¶¶ 20, 22.
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Quality Loan Service Corporation (“Quality”) became the successor
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trustee of the DOT.
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issued and caused to be recorded a Notice of Trustee’s Sale of
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the Property on March 18, 2016.
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SAC at ¶ 22; Exh. 5.
SAC at ¶ 24.
SAC at ¶ 27.
US Bank NA succeeded
Chase continued to be the
On January 4, 2016,
At SPS’s direction, Quality
SAC at ¶ 28.
Plaintiffs originally filed suit in the Superior Court of
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the State of California for the County of El Dorado on April 12,
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2016.
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case to federal court on May 19, 2016, after which Plaintiffs
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requested, but were denied, a Temporary Restraining Order to
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enjoin the foreclosure trustee’s sale.
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Plaintiffs submitted their First Amended Complaint on July 22,
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2016, ECF No. 17, which this Court dismissed with leave to amend
Notice of Removal at ¶ 1, ECF No. 1.
3
Chase removed the
ECF Nos. 1, 13, 16.
1
on November 22, 2016, ECF No. 33.
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Plaintiffs’ claims against JPMorgan Chase Bank, N.A., with
3
prejudice.
4
Complaint in December, removing the claim for declaratory relief—
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previously identified as Count 1 and which was dismissed with
6
prejudice—and alleging the facts more concretely.
ECF No. 34.
The Court also dismissed
Plaintiffs filed their Second Amended
ECF No. 35.
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II.
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A.
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OPINION
Leave to Amend
“The court considers five factors in assessing the propriety
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of leave to amend—bad faith, undue delay, prejudice to the
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opposing party, futility of amendment, and whether the plaintiff
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has previously amended the complaint.”
14
Colleges, 655 F.3d 984, 995 (9th Cir. 2011).
15
district court should freely give leave to amend when justice so
16
requires, the court’s discretion to deny such leave is
17
particularly broad where the plaintiff has previously amended its
18
complaint.”
19
Elec. Co., 713 F.3d 502 (9th Cir. 2013) (citations and quotation
20
marks omitted).
21
U.S v. Corinthian
“Although a
Ecological Rights Foundation v. Pacific Gas and
Plaintiffs have filed three versions of their Complaint in
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this action.
Additionally, Plaintiffs had notice of Defendant’s
23
arguments due to the previous Motion to Dismiss raising nearly
24
identical issues.
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amend is denied as to all dismissed causes of action.
26
///
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///
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///
See ECF Nos. 20, 28, & 31.
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Thus, leave to
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B.
Analysis
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1.
The Underlying Note
This Court dismissed Plaintiffs’ First Amended Complaint
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because Plaintiffs failed to plausibly allege that they signed
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the Note.
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deficient because Plaintiffs’ allegations are “factually
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unsupported” and contradicted by the Note attached as an exhibit
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to their SAC.
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See ECF No. 33.
Defendants argue that the SAC remains
MTD at 5–6.
“To survive a motion to dismiss, a complaint must contain
10
sufficient factual matter, accepted as true, to state a claim to
11
relief that is plausible on its face.”
12
U.S. 662, 678 (2009) (citation and quotation marks omitted).
13
copy of a written instrument that is an exhibit to a pleading is
14
a part of the pleading for all purposes.”
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“When an attached exhibit contradicts the allegations in the
16
pleadings, the contents of the exhibits trump the pleadings.”
17
Van Hook v. Curry, No. C 06-3148 PJH (PR), 2009 WL 773361, at *3
18
(N.D. Cal. Mar. 23, 2009).
19
Ashcroft v. Iqbal, 556
“A
Fed. R. Civ. P. 10(c).
Plaintiffs have plausibly alleged that they signed the Note.
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Beyond asserting this fact, they explain that they signed the
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Note concurrently with the Deed of Trust and they explain why
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they have a copy of the Deed of Trust but not the Note.
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also allege that the Note they signed was lost, which is why only
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the Henrichs’ signed copy of the Note is available.
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¶ 104.
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contradict their allegations because they allege that the Note
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they signed has been lost.
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Plaintiffs' allegations are unsupported are premature, as this
They
SAC at
The attached Note without their signatures does not
Defendants’ arguments that
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1
Court must take those allegations as true for the purposes of a
2
motion to dismiss.
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support Plaintiffs’ claims and each is dismissed on separate
4
grounds, as described below.
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2.
However, these allegations are not enough to
Count Two: Violation of Cal. Civ. Code § 2923.6
(c) and (d)
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“If a borrower submits a complete application for a first
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lien loan modification offered by, or through, the borrower's
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mortgage servicer, a mortgage servicer, mortgagee, trustee,
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beneficiary, or authorized agent shall not record a notice of
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default or notice of sale, or conduct a trustee's sale, while the
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complete first lien loan modification application is pending.”
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Cal. Civil Code § 2923.6(c).
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submitted a complete modification as of April 8, 2016.
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¶ 42.
Plaintiffs allege that they
SAC at
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Defendants argue that Plaintiffs’ application was never
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“pending” because Defendants refused to accept or acknowledge the
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modification application.
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need only allege they submitted a “complete” modification
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application under the code section.
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directs the Court’s attention to Cal. Civ. Code § 2924.10, which
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addresses “Submission of first lien modification document;
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written acknowledgment of receipt” and defines the term
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“complete.”
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borrower has supplied the mortgage servicer with all documents
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required by the mortgage servicer within the reasonable
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timeframes specified by the mortgage servicer,” Defendants
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contend that Plaintiff will be unable to allege submission of a
MTD at 6.
Plaintiffs assert that they
Opp. at 3.
Defendant
Because an application is deemed “‘complete’ when a
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complete application in these circumstances.
2
§ 2923.6(h) (defining the same).
3
See Cal. Civ. Code
Plaintiffs’ claim under § 2923.6(c) and (d) must be
4
dismissed as insufficiently pled.
“A bald allegation that a
5
party submitted ‘complete’ loan modification applications—without
6
sufficient supporting factual allegations—is a conclusory
7
statement, and the Court does not rely on such assertions in
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evaluating the sufficiency of Plaintiff’s complaint.”
9
CitiMortgage, Inc., No. CV 14-00278 BRO (SHx), 2014 WL 4359193,
Stokes v.
10
at *7 (C.D. Cal. Sep. 3, 2014); see also Cornejo v. Ocwen Loan
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Servicing, LLC, 151 F. Supp. 3d 1102, 1111 (E.D. Cal. 2015).
12
Plaintiffs failed to allege any facts other than the conclusory
13
statement that they submitted a complete application.
14
¶ 42.
15
See SAC at
Furthermore, given the code’s definition, Plaintiffs cannot
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allege that they submitted a complete application because their
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application was never acknowledged.
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the Court with a single case in which a plaintiff proceeded on a
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claim for a violation of § 2923.6(c) or (d) where the defendant
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never acknowledged the plaintiff’s application.
21
22
Plaintiffs do not provide
Count Two is dismissed without leave to amend.
3.
Count 3: Intentional Misrepresentation
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To state a claim for intentional misrepresentation a
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plaintiff must show “(1) a misrepresentation, (2) knowledge of
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falsity, (3) intent to induce reliance, (4) actual and
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justifiable reliance, and (5) resulting damage.”
27
Skype Inc., 220 Cal. App. 4th 217, 230–31 (2013).
28
of Civil Procedure 9(b) applies to state-law claims that sound in
7
Chapman v.
Federal Rule
1
fraud and requires the plaintiff to state with particularity the
2
circumstances constituting fraud.
3
317 F.3d 1097, 1103 (9th Cir. 2003).
4
constituting the alleged fraud [must] be specific enough to give
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defendants notice of the particular misconduct so that they can
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defend against the charge and not just deny that they have done
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anything wrong.”
8
omitted).
9
where, and how of the misconduct charged.”
10
Vess v. Ciba-Geigy Corp. USA,
“[T]he circumstances
Id. at 1106 (citations and quotation marks
The claim “must be accompanied by the who, what, when,
Id. (citations and
quotation marks omitted).
11
Plaintiffs allege that, through telephone conversations, SPS
12
employees misrepresented to Plaintiffs that they were not parties
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to the Note.
14
details necessary under the heightened pleading standard.
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instance, Plaintiffs have not alleged when these conversations
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occurred, how many conversations occurred, or how the
17
misrepresentations were conveyed.
SAC at ¶ 53.
Plaintiffs fail to provide the
For
18
More fatal to Plaintiffs’ claim is their theory of reliance.
19
Plaintiffs claim that they relied on the representation that they
20
were not parties to the loan, but Plaintiffs did not take any
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action or change their legal position due to that representation.
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As Plaintiffs put it, they “could not avail [themselves] of any
23
option to prevent the foreclosure trustee sale,” but that is
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because all of their remedies “would necessarily involve SPS who
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refused to communicate with [P]laintiffs on any option to avoid
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foreclosure.”
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wrongly or rightly—did not acknowledge them as parties to the
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Note and thus would not work with them on their foreclosure
SAC at ¶¶ 53–54.
Their problem is that SPS—
8
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avoidance options.
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alleged, they were wrongfully denied relief from their loan
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servicer.
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this reliance theory.
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Plaintiffs do not cite a single case in support of
Count Three is thus dismissed without leave to amend.
6
7
Plaintiffs were not induced to act; as
4.
Count 4: Negligent Misrepresentation
“The elements of negligent misrepresentation are similar to
8
intentional fraud except for the requirement of scienter; in a
9
claim for negligent misrepresentation, the plaintiff need not
10
allege the defendant made an intentionally false statement, but
11
simply one as to which he or she lacked any reasonable ground for
12
believing the statement to be true.”
13
App. 4th 170, 184 (2006).
14
misrepresentation rests upon the existence of a legal duty,
15
imposed by contract, statute or otherwise, owed by a defendant to
16
the injured person.”
17
(1988).
18
Charnay v. Cobert, 145 Cal.
“[R]esponsibility for negligent
Eddy v. Sharp, 199 Cal. App. 3d 858, 864
Defendants correctly argue that because the elements of
19
intentional and negligent misrepresentation overlap, this claim
20
fails for the reasons described above.
21
Four, too, is dismissed without leave to amend.
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5.
For those reasons, Count
Count 5: Breach of Implied Covenant of Good Faith
and Fair Dealing
23
24
“Every contract imposes upon each party a duty of good faith
25
and fair dealing in its performance and its enforcement.”
Carma
26
Developers (Cal.), Inc. v. Marathon Dev. Cal., Inc., 2 Cal. 4th
27
342, 371 (1992).
28
application in situations where one party is invested with a
“The covenant of good faith finds particular
9
1
discretionary power affecting the rights of another. Such power
2
must be exercised in good faith.”
3
to effectuate the intentions and reasonable expectations of the
4
parties reflected by mutual promises within the contract.”
5
v. HostPro, Inc., 174 Cal. App. 4th 833, 852 (2009).
6
covenant also requires each party to do everything the contract
7
presupposes the party will do to accomplish the agreements
8
purposes.”
9
Cal. App. 4th 1230, 1244 (2013).
Id. at 372.
It is “designed
Nein
“The
Thrifty Payless, Inc. v. Americana at Brand, LLC, 218
Because a breach of the
10
covenant is it a breach of contract, a plaintiff must allege
11
(1) a contract, (2) plaintiff’s performance (or excuse),
12
(3) defendant’s breach, and (4) resulting damages to the
13
plaintiff.
14
See id. at 1244.
The only alleged breach of the implied covenant is
15
Defendants’ failure to acknowledge Plaintiffs as parties to the
16
Note.
17
Plaintiffs have not alleged that they performed or were excused
18
from performance.
19
SAC at ¶ 70.
This claim is also insufficiently pled.
The SAC is also deficient with respect to causation and
20
damages.
“[N]o liability attaches if the damages sustained were
21
otherwise inevitable or due to unrelated causes.”
22
Bank of Am., N.A., 219 Cal. App. 4th 1481, 1499 (2013) (citations
23
and quotation marks omitted).
24
complete causal relationship and allege specific facts showing
25
“how the actions he or she took in reliance on the defendant’s
26
misrepresentations caused the alleged damages.”
27
Plaintiffs have not alleged facts indicating they would have been
28
successful in pursuing the remedies they list but for Defendants’
Rossberg v.
Plaintiffs must establish a
10
See id.
1
failure to acknowledge them as parties to the Note.
2
Plaintiffs allege that they would have qualified for a loan
3
modification or would have been allowed to enter into a short
4
sale transaction, SAC at ¶ 53(d), these allegations do not
5
establish a sufficiently plausible, causal connection between the
6
alleged misrepresentation and damages.
7
Mortg. Servicing, Inc., No. 2:12-00201 WBS CKD, 2014 WL 172537
8
(E.D. Cal. Jan. 15, 2014) (“[Plaintiffs] do not allege any facts
9
suggesting how pursuing these hypothetical avenues could have
Although
See Dick v. American Home
10
prevented the foreclosure of their home. . . . [T]he allegations
11
do not allow for a plausible inference that plaintiffs would have
12
been able to make the payments on the loan, or that these
13
purported alternative remedies would have been successful in
14
stemming the eventual foreclosure.”).
15
that the injuries complained of were not otherwise inevitable.
16
Count Five is also dismissed without leave to amend.
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6.
The Court cannot presume
Count 6: Negligence
To state a claim for negligence, a plaintiff must show (1) a
19
legal duty to use reasonable care, (2) breach of that duty, and
20
(3) proximate cause between the breach and (4) the plaintiff's
21
injury.
Mendoza v. City of L.A., 66 Cal.App.4th 1333, 1339
22
(1998).
“The existence of a legal duty to use reasonable care in
23
a particular factual situation is a question of law for the court
24
to decide.”
25
App. 4th 269, 278 (2004).
26
Vasquez v. Residential Investments, Inc., 118 Cal.
Defendants argue that they do not owe Plaintiffs a duty of
27
care due to the “general rule [that] a financial institution owes
28
no duty of care to a borrower when the institution’s involvement
11
1
in the loan transaction does not excess the scope of its
2
conventional role as a mere lender of money.”
3
Nymark v. Heart Fed. Savings & Loan Assn., 231 Cal. App. 3d 1089,
4
1096 (1991)).
5
court decisions following the principle—set out in Lueras v. BAC
6
Home Loans Servicing, LP, 221 Cal. App. 4th 49 (2013)—that a
7
lending institution does not owe a duty of care when
8
renegotiating a loan because renegotiation falls within the
9
conventional role of money lender.
10
MTD at 10 (citing
They direct the Court to a number of district
While authority on this issue is divided, this Court has
11
previously found that lending institutions do have a duty toward
12
borrowers in processing a loan modification application.
13
Hsin-Shawn Sheng v. Select Portfolio Servicing, Inc., No. 2:15-
14
cv-0255-JAM-KJN, 2015 WL 4508759, at *5 (E.D. Cal. July 24,
15
2015).
16
the other direction does not defeat this claim.
17
See
Thus, Defendants’ argument in reliance on decisions going
Defendants also argue that they did not breach a duty of
18
care because Plaintiffs were not parties to the Note.
19
accepts Plaintiffs’ allegations that they signed the Note and
20
thus this argument fails as well.
21
The Court
Although Defendants did not reassert the point, their
22
argument that Plaintiff has not adequately pled causation and
23
damages applies with the same force on this claim, which repeats
24
the “causation/damages” allegations of the previous claims
25
verbatim.
26
27
28
Thus, Count Six is dismissed without leave to amend.
7.
Count 7: Violation of Cal. Civ. Code § 17200
California’s Unfair Competition Law (“UCL”) defines unfair
competition as any unlawful, unfair, or fraudulent business
12
1
practice and any unfair, deceptive, untrue or misleading
2
advertising.
3
based on the violation of another law or on a practice that is
4
unfair but not independently unlawful.
5
Health, 30 Cal. 4th 798, 828 (2003).
6
the UCL may be brought by a person who has suffered injury in
7
fact and has lost money or property as a result of the unfair
8
competition.
9
Cal. Bus. & Prof. Code § 17200.
A UCL claim may be
See Olszewski v. Scripps
Actions for relief under
Cal. Bus. & Prof. Code § 17204.
Plaintiffs argue that the violations alleged in Counts 1-6
10
constitute unlawful or unfair businesses practices under the UCL.
11
SAC at ¶ 83; Opp. at 8.
12
insufficient to support those claims and, in turn, they will not
13
support Plaintiffs’ UCL theory as pled.
14
dismissed without leave to amend.
15
8.
The Court has found the allegations
This claim, too, is
Count 8: Intentional Infliction of Emotional
Distress
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17
The elements for the tort of intentional infliction of
18
emotional distress are: (1) extreme and outrageous conduct by the
19
defendant with the intention of causing, or with reckless
20
disregard of the probability of causing, emotional distress;
21
(2) plaintiff suffered severe or extreme emotional distress; and
22
(3) actual and proximate causation of the emotional distress by
23
defendant’s outrageous conduct.
24
1035, 1050 (2009).
25
conduct that is so extreme as to exceed all bounds of that
26
usually tolerated in a civilized community and so extreme and
27
outrageous as to go beyond all possible bonds [sic] of decency,
28
and to be regarded as atrocious, and utterly intolerable in a
Hughes v. Pair, 46 Cal. 4th
“Outrageous conduct has been defined as
13
1
civilized community.”
2
App. 3d 602, 616 (1985) (internal citations and quotation marks
3
omitted).
4
such substantial quality or enduring quality that no reasonable
5
person in civilized society should be expected to endure it.”
6
Id. at 1051.
7
Bogard v. Emp’r Casualty Co., 164 Cal.
“Severe emotional distress means emotion distress of
With respect to the second element, Plaintiffs’ allegations
8
are plainly insufficient.
Plaintiffs simply state that “[they]
9
did, in fact, suffer extreme and/or severe emotional distress.”
10
SAC at ¶ 89.
11
the nature or extent of their distress.
12
Prudential Fin., No. 2:07-cv-00944-MCE-DAD, 2007 WL 2827792 (E.D.
13
Cal. Sep. 27, 2007) (finding that plaintiff’s allegations that he
14
suffered from depression, frustration, nervousness, and anxiety
15
lacked the necessary specificity to show their nature or extent).
16
This cause of action fails on this basis.
17
Plaintiffs fail to offer any facts that would show
See Hamilton v.
Furthermore, the allegations could not sustain an outrageous
18
conduct finding.
Although “outrageous conduct” is a question of
19
fact, the Court may still dismiss the claim if the allegations
20
could not sustain such a finding.
21
Ragland v. U.S. Bank Nat. Assn., the court denied summary
22
judgment where the plaintiff alleged that the defendant had
23
induced her to skip a loan payment, later refused to accept loan
24
payments, and then sold her home in foreclosure.
25
4th 182, 204 (2012).
26
claim at the pleading stage, even where the complaint alleged
27
wrongful foreclosure or negligent behavior that led to a
28
foreclosure.
In the case Plaintiffs cite,
209 Cal. App.
Other courts, however, have dismissed the
See Martinez v. Flagstar Bank, FSB, No. 2:15-cv14
1
01934-KJM-CKD, 2016 WL 3906810 (E.D. Cal. Jul. 19, 2016)
2
(dismissing the IIED claim where plaintiffs alleged that
3
defendants lost and mismanaged their loan modification
4
application materials, promised not to have a foreclosure sale,
5
and then sold the home in foreclosure anyway); Aguinaldo v. Ocwen
6
Loan Servicing, LLC, 5:12-cv-01393-EJD, 2012 WL 3835080 (N.D.
7
Cal. Sep. 4, 2012) (dismissing the IIED claim where plaintiffs
8
alleged that defendant promised not to foreclose on their home,
9
plaintiffs relied on that promise in choosing not to pursue
10
alternative measures to prevent foreclosure, and defendant
11
foreclosed anyway).
12
that the lawfulness of foreclosure is in dispute, Defendants are
13
not alleged to have engaged in the kind of trickery presented in
14
the Ragland case.
15
the level of outrageousness necessary to survive a motion to
16
dismiss.
17
18
19
Although this case is similar to Ragland in
Defendants’ alleged behavior does not approach
Count Eight is dismissed without leave to amend.
9.
Count 9: Interference with Prospective Advantage
A claim for intentional interference with prospective
20
economic advantage has five elements: “(1) an economic
21
relationship between plaintiff and a third party, with the
22
probability of future economic benefit to the plaintiff;
23
(2) defendant's knowledge of the relationship; (3) an intentional
24
act by the defendant, designed to disrupt the relationship;
25
(4) actual disruption of the relationship; and (5) economic harm
26
to the plaintiff proximately caused by the defendant's wrongful
27
act, including an intentional act by the defendant that is
28
designed to disrupt the relationship between the plaintiff and a
15
1
third party.”
2
944 (2008).
3
Edwards v. Arthur Andersen LLP, 44 Cal. 4th 937,
Defendants argue that this claim fails because Plaintiffs
4
have failed to allege any economic relationship between
5
themselves and any third party or allege economic harm or injury.
6
Plaintiff did not oppose dismissal of this claim.
7
thus dismissed without leave to amend.
8
10.
Count Nine is
Count 10: Establishment of Lost or Destroyed
Promissory Note
9
10
Defendants argue that Plaintiffs’ final cause of action is
11
time barred because the statute of limitations began running from
12
the date of the alleged execution of the Note.
13
Plaintiffs argue that the statute of limitations should run from
14
the date Plaintiffs discovered that the Note did not exist.
15
at 10.
16
MTD at 14.
Opp.
“The discovery rule protects those who are ignorant of their
17
cause of action through no fault of their own.
18
delayed accrual until a plaintiff knew or should have known of
19
the wrongful conduct at issue.”
20
KTTV, 147 Cal. App. 3d 805, 832 (1983).
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benefit of the discovery rule must specifically plead facts to
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show (1) the time and manner of discovery and (2) the inability
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to have made earlier discovery despite reasonable diligence.”
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Stocco v. Gemological Inst. of Am., Inc., No. 12-cv-1291 WQH
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(DHB), 2015 WL 472143 at *7 (S.D. Cal. Feb. 5, 2015) (citations
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and quotation marks omitted).
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It permits
April Enterprises, Inc., v.
“A plaintiff seeking the
The SAC does not allege when Plaintiffs made the discovery.
Plaintiffs knew of this deficiency and failed to amend their
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complaint accordingly.
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Dismiss, ECF No. 28, at 14.
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to amend.
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See Opposition to Defendants’ Motion to
Count Ten is dismissed without leave
III.
ORDER
For the foregoing reasons, the Court GRANTS Defendants’
Motion to Dismiss and the case is DISMISSED WITH PREJUDICE:
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IT IS SO ORDERED.
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Dated:
March 17, 2017
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