Brooks et al v. FCI Lender Services, Inc. et al

Filing 31

ORDER signed by Magistrate Judge Kendall J. Newman on 01/23/2017 GRANTING Defendant FCI's 8 Motion to Dismiss IN THE FOLLOWING MANNER: (a) Plaintiffs' first, second, third, fourth, fifth, sixth, seventh, eighth, ninth, tenth, and thir teenth causes of action are DISMISSED WITHOUT LEAVE to amend to the extent they are asserted against defendant FCI; (b) Plaintiffs' eleventh, twelfth, fourteenth, and fifteenth causes of action are DISMISSED WITH LEAVE to amend insofar as they a re asserted against defendant FCI; within 45 days of the date of this order, plaintiffs SHALL FILE either an amended complaint in accordance with this order or a request for voluntary dismissal of this action pursuant to FRCP 41(a)(1)(A)(i); DENYING Defendant FCI's 9 Motion to Strike; DENYING AS MOOT SN Servicing Corporation's 20 Motion to Dismiss; and VACATING the 3/16/2017 Initial Scheduling Conference. The court will reschedule this conference at a later date if the court deems it necessary. (Jackson, T)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 JOHN BROOKS, et al., 12 Plaintiffs, 13 14 No. 2:16-cv-2598-KJM-KJN PS ORDER v. FCI LENDER SERVICES, INC., et al., 15 Defendants. 16 Presently before the court is defendant FCI Lender Services, Inc.’s (“FCI”) motion to 17 18 dismiss the claims asserted against it in plaintiffs’ complaint pursuant to Federal Rule of Civil 19 Procedure 12(b)(6), or, in the alternative, for a more definite statement pursuant to Federal Rule 20 of Civil Procedure 12(e). (ECF No. 8.) Also before the court is FCI’s motion to strike certain 21 portions of the complaint pursuant to Federal Rule of Civil Procedure 12(f). (ECF No. 9.) 22 Plaintiffs filed an opposition to the motions, and FCI filed a reply. (ECF Nos. 15, 25, 26.) The 23 court heard this matter on its January 19, 2017 law and motion calendar. Plaintiff John Brooks 24 appeared on his own behalf, but plaintiff Laura Brooks failed to make an appearance.1 Attorney 25 1 26 27 28 While the court did not discuss this with John Brooks during the hearing on this matter, plaintiffs are cautioned that because they are both currently proceeding pro se in this matter, they must both appear at any hearings scheduled in this action on their own behalf. As he is not an attorney, John Brooks may not appear on Laura Brooks’ behalf. Similarly, Laura Brooks may not make an appearance on behalf of John Brooks. The fact that plaintiffs may be married or have 1 1 Fred Hickman appeared telephonically on behalf of FCI.2 The undersigned has fully considered 2 the parties’ briefs, the parties’ oral arguments, and appropriate portions of the record. For the 3 reasons that follow, the court grants FCI’s motion to dismiss, with leave to amend as to some 4 claims, and without leave to amend as to others, as specified below. Furthermore, FCI’s motion 5 to strike is denied. 6 I. 7 Relevant Allegations of the Complaint Plaintiffs allege in their complaint that they are the owners of real property located at 1682 8 Chilton Dr. Roseville, CA 95747 (the “Property”). (ECF No. 1 at 10.) Plaintiffs allege that they 9 took out a “second Deed of Trust” (“Second DOT”) on the Property on an unspecified date, 10 which was originally held by defendant Homecoming Financial, LLC, and was subsequently 11 transferred numerous times. (Id.) “At some point in or around 2013, Defendant Ocwen Loan 12 Servicing serviced the loan on behalf of whichever entity held the [Second DOT] at that time.” 13 (Id.) Plaintiffs allege further that “[o]n February 20, 2008, Plaintiffs filed for Chapter 7 14 Bankruptcy in the Eastern District of California,” which discharged the loan held by 15 Homecoming Financial, LLC. (Id. at 11.)3 Plaintiffs also allege that “[i]n or around April 2015, the [Second DOT] was held by 16 17 Defendant Bucks [Financial, LLC]” (“Bucks”). (Id. at 10.) They allege further that “[o]n or 18 about April 13, 2015, Plaintiffs and Bucks reached a settlement/accord and satisfaction, in which 19 Plaintiffs agreed to pay and Bucks agreed to accept the sum of Five Thousand Dollars and no 20 cents ($5,000.00) as full and final settlement of the Second DOT.” (Id.) Plaintiffs allege that 21 “[t]his agreement was confirmed in writing.”4 (Id.) Plaintiffs allege further that “[w]ithin days of 22 23 24 25 some other familial connection is not sufficient to permit either plaintiff to represent the other plaintiff. 2 Counsel for defendants Ocwen Loan Servicing and SN Servicing Corporation also appeared telephonically at the hearing for purposes of monitoring the proceedings. 3 26 27 28 4 However, at the hearing, plaintiffs conceded that the loan was not discharged in the bankruptcy. Plaintiffs also allege that a “true and correct copy” of the written contract is attached to the complaint, but no such document is attached to the copy of the complaint attached to defendants’ notice of removal. (See ECF No. 1, Exhibit A.) 2 1 sending the confirming letter/contract, and prior to Plaintiffs’ receipt of said letter, a 2 representative from Bucks contacted Plaintiffs by phone to inform them that Bucks was breaching 3 the agreement.” (Id. at 11.) Plaintiffs allege that they offered to send the agreed-upon amount of 4 money to Bucks forthwith, but “Bucks specifically refused Plaintiffs’ tender of performance.” 5 (Id.) 6 Plaintiffs allege that Bucks sold the Second DOT to defendant MDJ Properties, LLC 7 (“MDJ”) “[i]n or around June 2015,” and that MDJ is the current holder of that loan. (Id. at 10- 8 11.) Plaintiffs allege further that defendant FCI is servicing the loan on MDJ’s behalf. (Id. at 9 11.) Plaintiffs also allege that they have attempted to meet and confer with both FCI and MDJ 10 regarding the purported contract plaintiffs had entered into with Bucks, but that both defendants 11 “have refused to acknowledge the settlement/contract.” (Id.) Plaintiffs allege that FCI, acting 12 through defendant California TD Specialists, recorded a Notice of Default (“NOD”) on the 13 Property on July 5, 2016, and indicated that it will record a Notice of Trustee’s Sale. (Id.) 14 Finally, plaintiffs allege that “[a]t all times relevant, including after Plaintiffs filing for Chapter 7 15 Bankruptcy protection, defendants, and each of them, notified all 3 credit reporting agencies, 16 TransUnion, Equifax, and Experian, that Plaintiffs were delinquent on the payments on the 17 Second DOT.” (Id.) 18 Based on these factual allegations, plaintiffs assert the following 15 causes of action 19 against all defendants: (1) breach of contract and the implied covenant of good faith and fair 20 dealing; (2) fraudulent inducement to contract; (3) common law restitution/unjust enrichment; 21 (4) specific performance; (5) accounting; (6) declaratory judgment and injunctive relief; (7) bad 22 faith denial of contract; (8) violation of bankruptcy discharge injunction; (9) violation of the Fair 23 Debt Collections Practices Act, 15 U.S.C. §§ 1601, 1692 et seq.; (10) violation of the California 24 Fair Debt Collections Practices Act, California Civil Code §§ 1788 et seq.; (11) violation of the 25 Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq.; (12) violation of the California Consumer 26 Credit Reporting Act, California Civil Code § 1785.10 et seq.; (13) fraud and conspiracy to 27 commit fraud; (14) unlawful business practices in violation of [California] Business & 28 Professions Code Section 17200; and (15) fraudulent business practices in violation of 3 1 [California] Business & Professions Code Section 17200. (Id. at 12-25.) 2 II. Legal Standards 3 A motion to dismiss brought pursuant to Federal Rule of Civil Procedure 12(b)(6) 4 challenges the sufficiency of the pleadings set forth in the complaint. Vega v. JPMorgan Chase 5 Bank, N.A., 654 F. Supp. 2d 1104, 1109 (E.D. Cal. 2009). Under the “notice pleading” standard 6 of the Federal Rules of Civil Procedure, a plaintiff’s complaint must provide, in part, a “short and 7 plain statement” of plaintiff’s claims showing entitlement to relief. Fed. R. Civ. P. 8(a)(2); see 8 also Paulsen v. CNF, Inc., 559 F.3d 1061, 1071 (9th Cir. 2009). “To survive a motion to dismiss, 9 a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that 10 is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. 11 Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads 12 factual content that allows the court to draw the reasonable inference that the defendant is liable 13 for the misconduct alleged.” Id. 14 In considering a motion to dismiss for failure to state a claim, the court accepts all of the 15 facts alleged in the complaint as true and construes them in the light most favorable to the 16 plaintiff. Corrie v. Caterpillar, Inc., 503 F.3d 974, 977 (9th Cir. 2007). The court is “not, 17 however, required to accept as true conclusory allegations that are contradicted by documents 18 referred to in the complaint, and [the court does] not necessarily assume the truth of legal 19 conclusions merely because they are cast in the form of factual allegations.” Paulsen, 559 F.3d at 20 1071. The court must construe a pro se pleading liberally to determine if it states a claim and, 21 prior to dismissal, tell a plaintiff of deficiencies in his complaint and give plaintiff an opportunity 22 to cure them if it appears at all possible that the plaintiff can correct the defect. See Lopez v. 23 Smith, 203 F.3d 1122, 1130-31 (9th Cir. 2000) (en banc); accord Balistreri v. Pacifica Police 24 Dep’t, 901 F.2d 696, 699 (9th Cir. 1990) (stating that “pro se pleadings are liberally construed, 25 particularly where civil rights claims are involved”); see also Hebbe v. Pliler, 627 F.3d 338, 342 26 & n.7 (9th Cir. 2010) (stating that courts continue to construe pro se filings liberally even when 27 evaluating them under the standard announced in Iqbal). 28 //// 4 In ruling on a motion to dismiss filed pursuant to Rule 12(b)(6), the court “may generally 1 2 consider only allegations contained in the pleadings, exhibits attached to the complaint, and 3 matters properly subject to judicial notice.” Outdoor Media Group, Inc. v. City of Beaumont, 506 4 F.3d 895, 899 (9th Cir. 2007) (citation and quotation marks omitted). Although the court may not 5 consider a memorandum in opposition to a defendant’s motion to dismiss to determine the 6 propriety of a Rule 12(b)(6) motion, see Schneider v. Cal. Dep’t of Corrections, 151 F.3d 1194, 7 1197 n.1 (9th Cir. 1998), it may consider allegations raised in opposition papers in deciding 8 whether to grant leave to amend, see, e.g., Broam v. Bogan, 320 F.3d 1023, 1026 n.2 (9th Cir. 9 2003). 10 III. Parties’ Requests for Judicial Notice 11 As an initial matter, both plaintiffs and FCI request that the court take judicial notice of 12 certain documents purportedly related to the allegations of the complaint, or to this action more 13 generally. (ECF Nos. 10, 15-1.)5 While the court recognizes that many of the documents for 14 which the parties seek judicial notice are properly noticeable, the court declines to notice them at 15 this juncture as none of these documents alter or assist in the court’s analysis of FCI’s motions set 16 forth below. 17 IV. Discussion 18 A. Breach of Contract and the Covenant of Good Faith and Fair Dealing 19 For their first cause of action, plaintiffs claim that they entered into a valid written 20 contract with defendant Bucks to fully settle the debt they owed under the Second DOT, which 21 was alleged to be in excess of $70,000, for a total of $5,000, but that Bucks repudiated that 22 23 24 25 26 27 28 5 Specifically, plaintiffs request that the court take judicial notice of: (1) the contract document they allegedly entered into with defendant Bucks referenced in the allegations of their complaint; (2) plaintiffs’ ex parte application for a temporary restraining order (“TRO”) filed in the present action in the Placer County Superior Court prior to defendants’ removal of this action; and (3) the Placer County Superior Court’s order granting plaintiffs’ motion for a TRO. (ECF No. 15-1.) FCI requests that the court take judicial notice of: (1) a Home Equity Line of Credit and Promissory Note dated June 17, 2005; (2) a Deed of Trust dated June 17, 2005 and recorded in the official records of the Placer County Recorder’s Office on June 28, 2005 as DOC-20050083060; and (3) the court docket of the U.S. Bankruptcy Court Eastern District of California, Case No.: 08-21985. (ECF No. 10.) 5 1 agreement when plaintiffs attempted to tender performance pursuant to its terms. Plaintiffs allege 2 further that the terms of the alleged contract subsequently became binding on defendants FCI and 3 MDJ when MDJ purchased Bucks’ rights under the Second DOT and FCI took over the role as 4 servicer under that note, but that both of those defendants refused to acknowledge the terms of 5 that agreement. Based on these allegations, plaintiffs contend that “[d]efendants breached the 6 contract and their duties of good faith and fair dealing . . . insofar as they refused to honor their 7 contractual obligations.” (ECF No. 1 at 12.) 8 To state a claim for breach of contract under California law, plaintiffs must allege (1) the 9 existence of a contract; (2) plaintiff’s performance; (3) defendant’s breach of the contract; and (4) 10 damages flowing from the breach. CDF Firefighters v. Maldonado, 158 Cal. App. 4th 1226, 1239 11 (Cal. Ct. App. 2008). In California, every contract also carries with it an implied covenant of 12 good faith and fair dealing. Wilson v. 21st Century Ins. Co., 42 Cal. 4th 713, 720 (2007) (“The 13 law implies in every contract . . . a covenant of good faith and fair dealing”); Freeman & Mills, 14 Inc. v. Belcher Oil Co., 11 Cal. 4th 85, 91 (1995) (“It is well settled that, in California, the law 15 implies in every contract a covenant of good faith and fair dealing.”) (emphasis in original). “A 16 typical formulation of the burden imposed by the implied covenant of good faith and fair dealing 17 is ‘that neither party will do anything which will injure the right of the other to receive the 18 benefits of the agreement.’” Andrews v. Mobile Aire Estates, 125 Cal. App. 4th 578, 5892 (Cal. 19 Ct. App. 2005) (quoting Gruenberg v. Aetna Ins. Co., 9 Cal. 3d 566, 573 (1973)). However, 20 “[t]he implied covenant of good faith and fair dealing ‘cannot impose substantive duties or limits 21 on the contracting parties beyond those incorporated in the specific terms of their agreement.’” 22 Lane v. Vitek Real Estate Indus. Grp., 713 F. Supp. 2d 1092, 1102 (E.D. Cal. 2010) (quoting 23 Agosta v. Astor, 120 Cal. App. 4th 596, 607 (Cal. Ct. App. 2004)). “Absent [a] contractual right 24 ... the implied covenant has nothing upon which to act as a supplement, and should not be 25 endowed with an existence independent of its contractual underpinnings.” Waller v. Truck Ins. 26 Exchange, Inc., 11 Cal. 4th 1, 36 (1995) (internal citations omitted). 27 28 With regard to defendant FCI, the complaint fails to allege facts sufficient to state a claim for breach of contract. While plaintiffs allege in a conclusory fashion that the terms of the 6 1 contract at issue were “subsequently binding upon . . . FCI and MDJ” because they were Bucks’ 2 successors in interest under the Second DOT, (ECF No. 1 at 12), plaintiffs fail to plausibly allege 3 that any obligations Bucks would have had under the purported contract were actually assigned to 4 or assumed by FCI or MJD through MJD’s alleged purchase of the loan from Bucks. “Where the 5 subject matter of the assignment (e.g., a bilateral contract) involves reciprocal rights and duties, 6 the assignor may transfer the benefits, i.e., the assignor may transfer his or her rights, but cannot 7 escape the burden of his or her obligation by a mere assignment. The assignor still remains liable 8 to the promisee.” 1 Witkin, Summary 10th Contracts § 730 (2005) (emphasis added). “Even if 9 the assignee assumes the obligation, i.e., agrees to perform it, the assignor still remains 10 secondarily liable as a surety or guarantor, unless the promisee releases him or her or the parties 11 execute a complete novation.” Id. (citing Cutting Packing Co. v. Packers Exchange of Calif., 86 12 Cal. 574, 576(1890); Fenn v. Pickwick Corp., 117 Cal. App. 236, 639 (Cal. Ct. App. 1931)). 13 Nothing in the complaint indicates that either FCI agreed to assume the obligation to 14 accept $5000.00 as complete satisfaction of plaintiffs’ payment obligations under the mortgage. 15 Indeed, the allegations establish that FCI explicitly “refused to acknowledge or honor the 16 settlement/contract.” (ECF No. 1 at 11.) Nor are there any allegations indicating that the parties 17 executed a valid novation under which FCI agreed to consider a $5000.00 payment as complete 18 satisfaction of plaintiffs’ payment obligations under the note. Accordingly, plaintiffs’ claim that 19 FCI breached its contractual obligations by refusing to honor the alleged settlement payment is 20 without merit as a matter of law. Similarly, their claim for breach of the covenant of good faith 21 and fair dealing lacks merit because it is premised on the same purported contractual 22 underpinnings as plaintiffs’ breach of contract claim. Therefore, plaintiffs’ first cause of action is 23 dismissed without leave to amend insofar as it is asserted against FCI. 24 B. Fraud-based Claims 25 Plaintiffs’ second and thirteenth causes of action are premised on fraud. Specifically, 26 plaintiffs contend in their second cause of action that defendant Bucks induced plaintiffs into an 27 agreement to settle the debt owed under the Second DOT without any intent to actually perform 28 its end of the bargain. In their thirteenth cause of action, plaintiffs similarly allege that Bucks 7 1 induced plaintiffs into the settlement contract based on unspecified false representations and 2 without an intent to be bound. Plaintiffs allege further that FCI and MDJ “knew or should have 3 known” that plaintiffs had entered into the settlement contract with Bucks at the time they 4 purchased Bucks’ interest under the Second DOT without “perform[ing] their due diligence” and 5 “with the intent, or with reckless disregard, to foreclose on the property and refuse to honor [the 6 settlement] contract.” (ECF No. 1 at 23.) Plaintiffs also nebulously allege that all defendants 7 engaged in a “conspiracy to commit fraud.” (Id.) 8 9 The elements of a fraud claim under California law are: (1) misrepresentation (false representation, concealment or nondisclosure); (2) knowledge of the falsity (or “scienter”); (3) 10 intent to defraud, i.e., to induce reliance; (4) justifiable reliance; and (5) resulting damage. Lazar 11 v. Superior Court, 12 Cal. 4th 631, 638 (1996). “[T]o establish a cause of action for fraud a 12 plaintiff must plead and prove in full, factually and specifically, all of the elements of the cause of 13 action.” Conrad v. Bank of America, 45 Cal. App. 4th 133, 156 (Cal. Ct. App. 1996). “The 14 absence of any one of these required elements will preclude recovery.” Wilhelm v. Pray, Price, 15 Williams & Russell, 186 Cal. App. 3d 1324, 1332 (Cal. Ct. App. 1986). To establish fraud 16 through concealment, a plaintiff must show that the defendant had a duty to disclose the 17 concealed facts. OCM Principal Opportunities Fund v. CIBC World Mkts. Corp.,157 Cal. App. 18 4th 835, 845 (Cal. Ct. App. 2007). “In addition, for a viable cause of action for fraud, the 19 pleading must show a cause and effect relationship between the fraud and damages sought; 20 otherwise no cause of action is stated.” Nagy v. Nagy, 210 Cal. App. 3d 1262, 1269 (Cal. Ct. 21 App. 1989); Zumbrun v. University of Southern California, 25 Cal. App. 3d 1, 12 (Cal. Ct. App. 22 1972). There is no separate cause of action for “conspiracy to commit fraud.” Rather, 23 “[c]onspiracy only serves as a theory of liability for claims of fraud.” Lane, 713 F. Supp. 2d at 24 1103, n.1 (citing Applied Equip. Corp. v. Litton Saudi Arabia Ltd., 7 Cal. 4th 503, 511 (1994)). 25 Federal Rule of Civil Procedure 9(b), which provides a heightened pleading standard for 26 fraud claims, states: “In alleging fraud or mistake, a party must state with particularity the 27 circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a 28 person’s mind may be alleged generally.” Fed. R. Civ. P. 9(b). These circumstances include the 8 1 “‘time, place, and specific content of the false representations as well as the identities of the 2 parties to the misrepresentations.’” Swartz v. KPMG LLP, 476 F.3d 756, 764 (9th Cir. 2007) (per 3 curiam) (quoting Edwards v. Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir. 2004)); see also 4 Kearns v. Ford Motor Co., 567 F.3d 1120, 1124 (9th Cir. 2009) (“Averments of fraud must be 5 accompanied by ‘the who, what, when, where, and how’ of the misconduct charged”). “Rule 9(b) 6 demands that the circumstances constituting the alleged fraud be specific enough to give 7 defendants notice of the particular misconduct . . . so that they can defend against the charge and 8 not just deny that they have done anything wrong.” Kearns, 567 F.3d at 1124. 9 With regard to plaintiffs’ second cause of action, it appears that plaintiffs name all 10 defendants to this claim despite only alleging that it was defendant Bucks that entered into the 11 purported contract with plaintiffs without an intent to perform its end of the bargain. Nothing in 12 the complaint’s allegations suggest that FCI was initially a party to this agreement or somehow 13 fraudulently induced plaintiffs into entering that arrangement. To the contrary, the allegations 14 show that FCI merely acted as mortgage servicer under the Second DOT after Bucks had sold its 15 interest to defendant MJD and had attempted to foreclose under that note after stepping into that 16 role. Because the allegations establish that FCI did not fraudulently induce plaintiffs into the 17 contract alleged in the complaint, plaintiffs’ second cause of action is dismissed without leave to 18 amend insofar as it is asserted against that defendant. 19 With regard to plaintiffs’ thirteenth cause of action, plaintiffs allege that “[d]efendants 20 FCI and MDJ, at the time of purchasing the note from their predecessors in interest, knew or 21 should have known that the . . . contract [between Bucks and plaintiffs] had been entered into, yet 22 purchased the loan with the intent, or with reckless disregard, to foreclose on the property and 23 refuse to honor this contract.” (ECF No. 1 at 23.) Plaintiffs allege further that “[h]ad Defendants 24 done their due diligence when purchasing this debt, they would have honored the terms of the 25 binding contract, or they would have chosen to not purchase the debt.” (Id.) 26 Plaintiffs’ fraud allegations with regard to FCI do not come remotely close to stating a 27 cognizable fraud claim against that defendant. Plaintiffs do not allege that FCI made a false 28 representation of fact, or concealed or did not disclose material facts. Instead, plaintiffs merely 9 1 allege that FCI was the loan servicer for MDJ after MDJ had entered into a contract with 2 defendant Bucks to purchase Bucks’ interest under the Second DOT, and that FCI refused to 3 honor the terms of a separate alleged agreement that plaintiff had entered into with Bucks 4 regarding payment of the loan secured by the Second DOT prior to MDJ’s purchase. Nothing in 5 these allegations remotely suggests that FCI made an actionable misrepresentation to plaintiffs in 6 connection with its actions relating to its servicing under the Second DOT, and subsequent 7 attempts to foreclose under that note. 8 As explained above, the allegations establish that FCI was not bound by the alleged 9 obligations of the contract plaintiffs purportedly entered into with Bucks, and the complaint does 10 not contain any allegations suggesting that FCI made some form of false representation that they 11 would honor the terms of that agreement when they actually intended to not do so. Instead, the 12 complaint makes it clear that FCI represented to plaintiffs upfront that it did not agree to assume 13 any obligations Bucks may have had under that agreement. (See ECF No. 1 at 11.) Accordingly, 14 plaintiffs’ fraud-based claims against FCI are dismissed without leave to amend. 15 C. Restitution/Unjust Enrichment 16 Third, plaintiffs claim that they are entitled to restitution and disgorgement of any unjustly 17 retained profits defendants have obtained through their alleged conduct. Unjust enrichment is not 18 an independent cause of action under California law. See, e.g., Jogani v. Superior Court, 165 Cal. 19 App. 4th 901, 911 (Cal. Ct. App. 2008) (“[U]njust enrichment is not a cause of action . . . . 20 Rather, it is a general principle underlying various doctrines and remedies, including quasi- 21 contract.”) (internal citation omitted); McBride v. Boughton, 123 Cal. App. 4th 379, 387 (Cal. Ct. 22 App. 2004) (“Unjust enrichment is not a cause of action, however, or even a remedy, but rather a 23 general principle, underlying various legal doctrines and remedies.”) (internal citations and 24 quotations omitted); Yates v. Aurora Loan Servs., LLC, 2011 WL 2429376, at *9 (N.D. Cal. June 25 13, 2011) (citing Melchior v. New Line Productions, Inc., 106 Cal. App. 4th 779, 793 (Cal. Ct. 26 App. 2003) (“There is no claim for unjust enrichment in California, rather it is an equitable 27 remedy.”). Accordingly, plaintiffs’ third cause of action against FCI is dismissed without leave to 28 amend. 10 1 D. 2 For their fourth cause of action, plaintiffs assert that they are entitled to specific Specific Performance 3 performance of the purported contract they entered into with Bucks, the terms of which required 4 the acceptance of $5,000.00 as full satisfaction of plaintiffs’ payment obligations under the 5 mortgage at issue. 6 In order to seek specific performance of a contract under California law, plaintiffs must be 7 able to allege the following: “(1) a contract sufficiently definite and certain in its terms to be 8 enforced; (2) that the contract was just and reasonable; (3) that [plaintiffs] ha[ve] performed 9 [their] side of the bargain; (4) that the promisor has failed to perform; . . . (5) that the contract was 10 supported by adequate consideration[; and] . . . (6) that [their] remedy at law is inadequate.” 11 Porporato v. Devincenzi, 261 Cal. App. 2d 670, 674 (Cal. Ct. App. 1968) (internal citations 12 omitted). It has long been recognized that “specific performance will be granted only where the 13 legal remedy is inadequate.” Eagle Rock Entm’t, Inc. v. Coming Home Prods., Inc., 2004 WL 14 5642002, at *17 (C.D. Cal. Sept. 1, 2004) (citing Morrison v. Land, 169 Cal. 580 (1915)). In 15 Morrison, the California Supreme Court noted that “the exclusive jurisdiction of equity to grant 16 relief by way of specific performance of a contract will be exercised only in those cases where the 17 legal remedy of compensatory damages is insufficient under the circumstances of the case . . . to 18 do complete justice between the parties.” 169 Cal. at 586. Applying this principle, courts have 19 generally found damages to be inadequate only in cases where the services rendered pursuant to 20 the contract at issue were “peculiar, extraordinary, or unique,” such as contracts for the transfer of 21 real property. Kennedy v. Bank of America, 237 Cal. App. 2d 637, 647 (Cal. Ct. App. 1965) 22 (citing Morrison, 169 Cal. at 586-87); see also Porporato, 261 Cal. App. 2d at 677. Furthermore, 23 “the fact that damages may be difficult to prove or ascertain does not require that specific 24 performance be granted.” Eagle Rock Entm’t, Inc., 2004 WL 5642002, at *17 (citing Wooley v. 25 Embassy Suites, Inc., 227 Cal. App. 3d 1520, 1535 (Cal. Ct. App. 1991). 26 Here, the alleged contract at issue is the one allegedly entered into with Bucks under 27 which Bucks would accept plaintiffs’ payment of $5,000.00 as full satisfaction of their payment 28 obligations under their mortgage. Plaintiffs attempt to assert that Bucks’ alleged obligation to 11 1 accept that amount as full settlement was assigned to defendants FCI and MDJ when MDJ 2 purchased the loan from Bucks, and FCI became the loan’s servicer under the Second DOT. 3 However, as discussed above with regard to plaintiffs’ first cause of action for breach of contract, 4 the allegations demonstrate that FCI did not assume the obligation to accept $5,000.00 as full 5 satisfaction of the loan; nor did it enter into a valid novation with plaintiffs creating such an 6 obligation. Accordingly, plaintiffs cannot assert a valid action for specific performance against 7 FCI as that defendant was not bound by the contractual obligation plaintiffs seek to enforce 8 through their specific performance claim. Furthermore, nothing in the allegations indicates that 9 the alleged contract at issue required the provision of peculiar, extraordinary, or unique services 10 such that a legal remedy would be inadequate to compensate plaintiffs for their alleged losses. 11 Indeed, any losses plaintiffs may have suffered as a result of the alleged breach of contract would 12 be purely pecuniary in nature and, therefore, could be recovered through an adequate damages 13 remedy. Accordingly, plaintiffs’ allegations fail to state a claim for specific performance against 14 FCI and their fourth cause of action against that defendant is dismissed without leave to amend. 15 E. Accounting 16 Fifth, plaintiffs assert an action for accounting. Specific to this claim, they allege that all 17 defendants have unjustly retained profits from their alleged actions that are “unknown to 18 Plaintiffs and cannot be ascertained without an accounting of the business of Defendants from 19 2008 to present.” (ECF No. 1 at 14-15.) 20 “An action for an accounting may be brought to compel the defendant to account to the 21 plaintiff for money or property (1) where a fiduciary relationship exists between the parties, or (2) 22 where, even though no fiduciary relationship exists, the accounts are so complicated that an 23 ordinary legal action demanding a fixed sum is impracticable.” Jolley v. Chase Home Fin., LLC, 24 213 Cal. App. 4th 872, 910 (Cal. Ct. App. 2013). “An action for accounting is not available 25 where the plaintiff alleges the right to recover a sum certain or a sum that can be made certain by 26 calculation.” Teselle v. McLoughlin, 173 Cal. App. 4th 156, 179 (Cal. Ct. App. 2009); see also 27 St. James Church of Christ Holiness v. Superior Court In & For Los Angeles Cty., 135 Cal. App. 28 2d 352, 359 (1955) (citing Kinley v. Thelen, 158 Cal. 175, 182 (1910)) (“An accounting will not 12 1 be accorded with respect to a sum that a plaintiff seeks to recover and alleges in his complaint to 2 be a sum certain.”). 3 Nothing in the complaint here hints at the existence of a fiduciary relationship between 4 plaintiffs and FCI giving rise to a right by plaintiffs to seek the accounting they request. 5 Moreover, plaintiffs allege that “[d]efendants allege that Plaintiffs owe in excess of $70,000 on 6 the note,” the purported contract between plaintiffs and Bucks stated that plaintiffs were to pay 7 Bucks $5,000.00 “as full and final settlement of the Second DOT,” and plaintiffs seek damages 8 for either sums certain or sums that can be made certain by calculation. (See ECF No. 1 at 10, 9 26-27.) Accordingly, the allegations show that there was neither a fiduciary relationship between 10 plaintiffs and FCI, nor a specification of amounts due so complicated that they cannot be 11 determined in a legal action for damages. Therefore, plaintiffs’ cause of action for accounting 12 against FCI is dismissed without leave to amend. 13 F. Declaratory Judgment and Injunctive Relief 14 For their sixth cause of action, plaintiffs assert a claim for declaratory judgment and 15 injunctive relief. Declaratory relief and injunctive relief are not independent claims, but are 16 instead forms of relief that may be requested in conjunction with a cognizable cause of action that 17 permits a court to grant such relief. Santos v. Countrywide Home Loans, 2009 WL 3756337, at 18 *5 (E.D. Cal. Nov. 6, 2009) (“Declaratory and injunctive relief are not independent claims, rather 19 they are forms of relief.”). Accordingly, plaintiffs’ sixth cause of action against FCI is dismissed 20 without leave to amend insofar as it seeks to obtain declaratory and injunctive relief independent 21 of any of plaintiffs’ other claims. 22 G. 23 In their seventh cause of action, plaintiffs assert that defendants are liable for their “bad 24 25 Bad Faith Denial of Contract faith denial of contract.” No cause of action exists under California law for a bad faith denial of contract except in 26 cases involving an insurance contract. In Freeman & Mills, Inc. v. Belcher Oil Co., 11 Cal. 4th 27 85, 103 (1995), the California Supreme Court overruled its prior holding in Seaman’s Direct 28 Buying Service, Inc. v. Standard Oil Co., 36 Cal. 3d 752 (1984), and adopted “a general rule 13 1 precluding tort recovery for noninsurance contract breach, at least in the absence of violation of 2 an independent duty arising from principles of tort law . . . other than the bad faith denial of the 3 existence of, or liability under, the breached contract.” 4 Here, plaintiffs allege that “[d]efendants FCI and Bucks previously acknowledged in 5 writing the existence of the settlement agreement/contract but continue to refuse to honor its 6 terms.” (ECF No. 1 at 16.) Under the California Supreme Court’s ruling in Freeman & Mills, 7 Inc., no such tort claim exists as a matter of law as this action does not involve an insurance 8 contract, and plaintiffs’ allegations make it clear that FCI did not violate an independent duty 9 arising from tort law. See Zender v. Vlasic Foods, Inc., 91 F.3d 158 (9th Cir. 1996) (affirming 10 judgment dismissing claim for bad faith breach of contract sounding in tort based on the 11 California Supreme Court’s decision in Freeman & Mills, Inc. and noting that “[t]he remedy, if 12 any, [for such a claim] is for breach of contract”). Rather, it is clear that plaintiffs’ bad faith 13 denial of contract claim is little more than a restyling of their breach of contract claim under a 14 different name. Accordingly, plaintiffs’ bad faith denial of contract claim against FCI is 15 dismissed without leave to amend. 16 H. Violation of Bankruptcy Discharge Injunction 17 For their eighth cause of action, plaintiffs assert, pursuant to 11 U.S.C. § 524, that 18 defendants violated the injunction put in place by the court in plaintiffs’ alleged bankruptcy 19 action against plaintiffs’ creditors from seeking to collect any debts discharged in that action. 20 However, a debtor cannot assert an action against creditors pursuant to 11 U.S.C. § 524, as no 21 private right of action exists under that statute. Walls v. Wells Fargo Bank, N.A., 276 F.3d 502, 22 510 (9th Cir. 2002) (“[W]e cannot say that Congress intended to create a private right of action 23 under [11 U.S.C.] § 524, and we shall not imply one.”). Therefore, plaintiffs’ eighth cause of 24 action against FCI is dismissed without leave to amend. 25 26 27 28 I. Claims for Violation of the Fair Debt Collections Practices Act and California Fair Debt Collections Practices Act For their ninth and tenth causes of action, plaintiffs assert that defendants violated the Fair Debt Collections Practices Act (“FDCPA”) and California’s Rosenthal Fair Debt Collections 14 1 Practices Act (“RFDCPA”).6 “The [FDCPA] prohibits ‘debt collector[s]’ from making false or misleading 2 3 representations and from engaging in various abusive and unfair practices.” Heintz v. Jenkins, 4 514 U.S. 291, 292 (1995). Similarly, the RFDCPA “prohibits a host of unfair and oppressive 5 methods of collecting debt.” Castaneda v. Saxon Mortg. Servs., Inc., 687 F. Supp. 2d 1191, 1197 6 (E.D. Cal. 2009). “To be liable for a violation of the FDCPA or the RFDCPA, the defendant 7 must—as a threshold requirement—be a ‘debt collector’ within the meaning of the Acts.” 8 Putkkuri v. Reconstruct Co., 2009 WL 32567, at *7 (S.D. Cal. Jan.5, 2009) (emphasis added); see 9 also 15 U.S.C. § 1692a(6); Cal. Civ. Code § 1788.2(c). “The law is well settled that FDCPA’s 10 definition of debt collector does not include the consumer’s creditors, a mortgage servicing 11 company, or any assignee of the debt.” Lal v. Am. Home Servicing, Inc., 680 F. Supp. 2d 1218, 12 1224 (E.D. Cal. 2010) (citing Perry v. Stewart Title Co., 756 F.2d 1197, 1208 (5th Cir. 1985)) 13 (emphasis added); see also Angulo v. Countrywide Home Loans, Inc., 2009 WL 3427179, at *5 14 (E.D. Cal. October 26, 2009); Nera v. Am. Home Mortg. Servicing, Inc., 2009 WL 2423109, at 15 *4 (N.D. Cal. Aug. 5, 2009); Pineda v. Saxon Mortg. Servs., 2008 WL 5187813, at *3 (C.D. Cal. 16 Dec. 10, 2008). Similarly, mortgage servicing companies do not fall within the definition of 17 “debt collector” under the RFDCPA. Mannello v. Residential Credit Sols., Inc., 2016 WL 94236, 18 at *4 (C.D. Cal. Jan. 7, 2016) (internal citations and quotation marks omitted) (“The law is well 19 settled that FDCPA’s definition of debt collector does not include the consumer’s creditors, a 20 mortgage servicing company, or any assignee of the debt. . . . The same is true of the Rosenthal 21 Act.”); Lal, 680 F. Supp. 2d at 1224 (“[T]he RFDCPA does in fact mirror in the FDCPA, their 22 intentions were the same and exclusive, and, as such, a loan servicer is not a debt collector under 23 these acts.”). Furthermore, “the law is clear that foreclosing on a property pursuant to a deed of 24 trust is not a debt collection within the meaning of the RFDCPA or the FDC[P]A.” Gamboa v. 25 Tr. Corps & Cent. Mortg. Loan Servicing Co., 2009 WL 656285, at *4 (N.D. Cal. Mar. 12, 2009); 26 Tapia v. Aurora Loan Servs., LLC, 2009 WL 2705853 (E.D. Cal. Aug. 25, 2009); Ricon v. 27 28 6 Plaintiffs refer to the RFDCPA as the “California Fair Debt Collection Practices Act” in their complaint. (ECF No. 1 at 19.) 15 1 Recontrust Co., 2009 WL 2407396 (S.D. Cal. Aug. 4, 2009). 2 Here, plaintiffs allege that FCI is the current mortgage servicer under the Second DOT, 3 attempted to foreclose on the Property, and refused to acknowledge plaintiffs’ alleged settlement 4 contract that plaintiffs allegedly entered into with defendant Bucks. Such allegations establish 5 that plaintiffs cannot sustain a claim against FCI under the FDPCA or the RFDCPA because FCI 6 is not a “debt collector” and did not engage in “debt collection” within the meaning those Acts. 7 Accordingly, plaintiffs’ FDPCA or the RFDCPA against FCI are dismissed without leave to 8 amend. 9 10 11 J. Violations of the Fair Credit Reporting Act and California’s Consumer Credit Reporting Act For their eleventh and twelfth causes of action, plaintiffs claim that defendants violated 12 the Fair Credit Reporting Act (“FCRA”), 15 U.S.C. §§ 1681, et seq., and California’s Consumer 13 Credit Reporting Act (“CCRA”), California Civil Code §§ 1785.10, et seq. Plaintiffs allege with 14 respect to both claims that defendants failed to respond to objections plaintiffs provided them 15 regarding the validity of the debt under the mortgage at issue and failed to provide notice to the 16 credit reporting agencies that plaintiffs disputed the validity of the information they furnished to 17 those agencies regarding that debt. 18 Under the FCRA, “[l]iability on a furnisher [of information to a credit reporting agency 19 (“CRA”)] is limited in that an individual consumer cannot state an FCRA claim against a 20 furnisher unless the furnisher receives notice of the disputed information from the CRA and fails 21 to comply with its duties.” Johnson v. Wells Fargo Home Mortg., Inc., 558 F. Supp. 2d 1114, 22 1120 (D. Nev. 2008) (citing Nelson v. Chase Manhattan Mortgage Corp., 282 F.3d 1057, 23 1060(9th Cir. 2002)) (emphasis added). “The Ninth Circuit has specifically held that the 24 furnisher’s . . . duty to investigate is triggered only after the consumer notifies the CRA, and the 25 CRA then notifies the furnisher of credit.” Nelson v. Equifax Info. Servs., LLC, 522 F. Supp. 2d 26 1222, 1231 (C.D. Cal. 2007) (citing Nelson, 282 F.3d at 1060) (emphasis added). It is 27 insufficient to sustain a claim under the FCRA based on a furnisher’s failure to investigate the 28 accuracy of credit information it provides to a CRA when the furnisher’s only notice that the 16 1 accuracy of that information is disputed comes from the consumer. See Sanai v. Saltz, 170 Cal. 2 App. 4th 746, 765 (Cal. Ct. App. 2009) (dismissing FCRA claim because the only notice 3 defendant received that the information it provided to Experian was inaccurate came from the 4 plaintiff, not Experian). In their opposition to FCI’s motion, plaintiffs acknowledge that they have not yet notified 5 6 the CRAs of their belief that the information defendants provided to those agencies was 7 inaccurate, thereby making their FCRA and CCRA claims premature. Accordingly, plaintiffs 8 request that the court dismiss those claims, but grant plaintiffs leave to amend their complaint to 9 re-assert them once they have provided notice to the CRAs, and the CRAs, in turn, have provided 10 notice to defendants. FCI appears to not object to plaintiffs’ request with regard to their FCRA 11 claim. Therefore, plaintiffs’ eleventh cause of action under the FCRA is dismissed with regard to 12 FCI, but with leave to amend. 7 FCI argues in its motion that plaintiffs’ CCRA claim should be dismissed without leave 13 14 to amend as it is preempted by the FCRA. However, while claims under many of the CCRA’s 15 provisions are preempted by the FCRA, see 15 U.S.C. § 1681t(b)(1)(F), the FCRA “expressly 16 saves from preemption ‘section 1785.25(a) of the California Civil Code,’” which is a provision of 17 the CCRA. Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876, 888 (9th Cir. 2010) (quoting 15 18 U.S.C. § 1681t(b)(1)(F)(ii)). Section 1785.25(a) provides that “[a] person shall not furnish 19 information on a specific transaction or experience to any consumer credit reporting agency if the 20 person knows or should know the information is incomplete or inaccurate.” Here, it is not 21 presently clear from the allegations of the complaint whether plaintiffs would be able to state a 22 claim under Section 1785.25(a), or any other provision of the CCRA that has not been preempted 23 by the FCRA. Accordingly, plaintiffs’ twelfth cause of action under the CCRA is dismissed, but 24 with leave to amend despite FCI’s well-taken argument that many of the provisions of that Act 25 are preempted by the FCRA. Nevertheless, plaintiffs are cautioned that if they decide to later 26 7 27 28 Nevertheless, plaintiffs are cautioned that if they later amend their complaint to re-state a claim under the FCRA, they must clearly identify each defendant against whom they are asserting that claim and provide factual allegations specific to each defendant against whom that claim is brought that demonstrate how that defendant is liable under the FCRA. 17 1 amend their complaint to re-assert their CCRA claim, such a claim must be asserted only under 2 the provisions of that Act that have not been preempted by the FCRA. 3 K. Claims Under California Business & Professions Code Section 17200, et seq. 4 Finally, for their fourteenth and fifteenth causes of action, plaintiffs claim that all 5 defendants engaged in fraudulent and unlawful business practices in violation of California’s 6 unfair competition law (“UCL”), California Business & Professions Code §§ 17200, et seq. 7 To prove a claim under the UCL, a plaintiff must show “that the defendant committed a 8 business act that is either fraudulent, unlawful, or unfair.” Levine v. Blue Shield of California, 9 189 Cal. App. 4th 1117, 1136 (2010). “A defendant cannot be liable under § 17200 for 10 committing ‘unlawful business practices’ without having violated another law.” Ingels v. 11 Westwood One Broad. Servs., Inc., 129 Cal. App. 4th 1050, 1060 (Cal. Ct. App. 2005). 12 Accordingly, a UCL claim based on such an allegation must rest on a violation of some 13 independent substantive statute, regulation or case law. See Farmers Ins. Exch. v. Superior Court, 14 2 Cal. 4th 377, 383 (1992) (action under section 17200 borrows violations of other laws). 15 Business conduct is “unfair” under the UCL, when it “offends an established public policy or . . . 16 is immoral, unethical, oppressive, unscrupulous or substantially injurious to consumers.” People 17 v. Casa Blanca Convalescent Homes, Inc., 159 Cal. App. 3d 509, 530 (Cal. Ct. App. 1984). A 18 business act is “fraudulent” within the meaning of the UCL if it is “likely to deceive the public.” 19 McKell v. Washington Mutual, Inc., 142 Cal. App. 4th 1457, 1471 (Cal. Ct. App. 2006). In 20 asserting a claim under the UCL’s “fraudulent” prong in federal court, a plaintiff must plead facts 21 that meet the particularity requirements of Federal Rule of Civil Procedure 9(b). See Kearns v. 22 Ford Motor Co., 567 F.3d 1120, 1127 (9th Cir. 2009). 23 Because plaintiffs’ UCL claim against FCI based on a theory of unlawful business 24 practices is predicated on the same conduct giving rise to plaintiffs’ other causes of action against 25 that defendant and the complaint fails to state a cognizable cause of action with regard to any of 26 those claims for the reasons discussed above, plaintiffs’ UCL claim against FCI is not cognizable 27 as a matter of law insofar as it is based on an unlawful business practice. However, because it 28 may still be possible for plaintiffs to allege a violation of another law against FCI if given an 18 1 opportunity to amend their complaint, their UCL claim premised on unlawful business practices 2 is dismissed with leave to amend. Similarly, with regard to plaintiffs’ UCL claim premised on fraudulent business practices, 3 4 the complaint fails to allege facts indicating that FCI engaged in any fraudulent conduct for the 5 reasons discussed above with regard to plaintiffs’ causes of action premised on fraud. 6 Furthermore, nothing in the complaint suggests that FCI’s alleged conduct is “likely to deceive 7 the public” as the allegations do not establish that it engaged in a deceptive practice with regard to 8 acting in its role as servicer under the Second DOT. However, while the court is skeptical that 9 plaintiffs can state facts giving rise to a cognizable UCL claim for fraudulent business practices 10 against FCI, plaintiffs’ fifteenth cause of action is dismissed with leave to amend as it may be 11 possible for them to amend their complaint to state such a claim against that defendant based on 12 the other causes of action for which they are granted leave to amend. 13 V. 14 15 Motion to Strike Defendant FCI also filed a motion to strike certain portions of plaintiffs’ complaint pursuant to Federal Rule of Civil Procedure Rule 12(f). 16 Rule 12(f) permits the court to strike any “insufficient defense or any redundant, 17 immaterial, impertinent, or scandalous matter.” Fed. R. Civ. P. 12(f). “Motions to strike are a 18 drastic remedy and generally disfavored.” Ricon v. Recontrust Co., 2009 WL 2407396, at *2 19 (S.D. Cal. Aug. 4, 2009). “A matter is impertinent if the statements do not pertain, and are not 20 necessary, to the issues in question.” Id. (citing Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 21 (9th Cir. 1993), rev’d on other grounds, 510 U.S. 517 (1994)). “‘Scandalous’ matters ‘casts a 22 cruelly derogatory light on a party or other person.’” Ricon, 2009 WL 2407396, at *2 (quoting In 23 re, Inc. Sec. Litig., 114 F. Supp. 2d 955, 965 (C.D. Cal.2000). “‘Motions to strike 24 affirmative defenses are generally disfavored, but the court may properly grant them when the 25 defense is insufficient as a matter of law.’” Ricon, 2009 WL 2407396, at *2 (quoting Multimedia 26 Patent Trust v. Microsoft Corporation, 525 F. Supp. 2d 1200, 1211 (S.D. Cal. 2007)). 27 28 FCI’s motion to strike is directed toward specific allegations in the complaint relating to the existence of an agency relationship among defendants and exemplary damages. None of these 19 1 allegations constitute an insufficient defense, or a redundant, immaterial, impertinent or 2 scandalous allegation of the sort covered by Rule 12(f). See Drewett v. Aetna Cas. & Sur. Co., 3 405 F. Supp. 877, 878 (W.D. La. 1975) (denying Rule 12(f) motion to strike directed toward 4 allegations in the complaint relating to the plaintiffs’ demand for penalties and attorneys’ fees 5 because such allegations do not fall within the scope of Rule 12(f)). Furthermore, FCI’s 6 arguments in support of its request to strike these portions of the complaint are based on the 7 assertion that the targeted allegations are conclusory in nature and, therefore, insufficient to 8 support the legal conclusions plaintiffs attempt to draw from them. Such arguments appear to be 9 more appropriately directed through a motion to dismiss pursuant to Rule 12(b)(6), which FCI has 10 also filed, rather than a motion to strike. Accordingly, FCI’s motion to strike is denied. 11 VI. Conclusion 12 For the reasons discussed above, plaintiffs’ complaint fails to provide allegations 13 sufficient to state a cognizable claim against defendant FCI. Furthermore, the allegations of the 14 complaint make it clear that many of plaintiffs’ claims asserted against that defendant are not 15 cognizable as a matter of law. Therefore, plaintiffs should not be granted leave to amend as to 16 those claims against FCI as amendment would be futile. See Cahill v. Liberty Mut. Ins. Co., 80 17 F.3d 336, 339 (9th Cir. 1996). However, with regard to plaintiffs’ other claims against FCI, 18 specifically their eleventh, twelfth, fourteenth, and fifteenth causes of action, it is conceivable that 19 plaintiffs could state a cognizable claim if given the opportunity to amend. Accordingly, FCI’s 20 motion to dismiss is also granted as to those claims, but with leave to amend. 21 The court notes that the reasons for dismissing many of plaintiffs’ claims asserted against 22 FCI are likely equally applicable to some or all of the similar claims plaintiffs assert against other 23 defendants named in this action. However, instead of also dismissing plaintiffs’ claims against 24 these other non-moving defendants at this juncture, see Silverton v. Dep’t of Treasury, 644 F.2d 25 1341, 1345 (9th Cir. 1981) (“A District Court may properly on its own motion dismiss an action 26 as to defendants who have not moved to dismiss where such defendants are in a position similar 27 to that of moving defendants or where claims against such defendants are integrally related.”), the 28 court finds it to be more beneficial to all parties involved to provide plaintiffs an opportunity to 20 1 amend their complaint, reassess their claims against each defendant in light of this order, and 2 determine whether there exists a good faith basis to support each of their claims currently asserted 3 against those defendants. Accordingly, plaintiffs shall file a first amended complaint in 4 accordance with this order.8 5 With regard to the first amended complaint, plaintiffs are cautioned that they cannot 6 continue to assert any claims against FCI that have been dismissed without leave to amend. 7 Furthermore, for each claim, plaintiffs must clearly identify the defendant or defendants against 8 whom that claim is specifically asserted and provide factual allegations sufficient to demonstrate 9 a cognizable cause of action with respect to each of those defendants. More importantly, 10 plaintiffs must have a good faith basis for making such allegations. See Fed. R. Civ. P. 11(b). If 11 plaintiffs determine that they cannot in good faith allege facts that would support a particular 12 claim against a particular defendant, then they may wish to omit that claim from their amended 13 complaint as failure to make allegations on a good faith basis may be grounds for the imposition 14 of sanctions pursuant to Rule 11 of the Federal Rules of Civil Procedure. See Fed. R. Civ. P. 15 11(c). If plaintiffs decide to file an amended complaint, it shall be captioned “First Amended 16 17 Complaint” and shall not exceed 40 pages, including attachments.9 Plaintiffs shall file their First 18 Amended Complaint within 45 days from the date of this order. Plaintiffs are informed that the 19 court cannot refer to the original complaint, briefs, exhibits, or other filings to make their 20 amended complaint complete. Local Rule 220 requires that an amended complaint be complete 21 in itself without reference to any prior pleading. Thus, once an amended complaint is filed, it 22 supersedes the original complaint, which no longer serves any function in the case. 23 Plaintiffs are further informed that they are not required to file an amended complaint. If 24 plaintiffs determine that they do not wish to pursue the action at this juncture or that they cannot 25 8 26 27 28 Because plaintiffs are directed to file an amended complaint, defendant SN Servicing Corporation’s pending motion to dismiss the original complaint (ECF No. 20) is denied as moot. 9 As the court noted during the hearing, plaintiffs should attach to their First Amended Complaint any operative document(s) they allege form the basis of the purported contract between defendant Bucks and themselves. 21 1 in good faith allege any facts asserting cognizable claims against any defendant, they may instead 2 file a request for voluntary dismissal of the action without prejudice pursuant to Federal Rule of 3 Civil Procedure 41(a)(1)(A)(i). 4 Based on the foregoing, IT IS HEREBY ORDERED that: 5 1. Defendant FCI’s motion to dismiss (ECF No. 8) is granted in the following 6 manner: 7 a. Plaintiffs’ first, second, third, fourth, fifth, sixth, seventh, eighth, ninth, 8 tenth, and thirteenth causes of action are dismissed without leave to amend 9 to the extent they are asserted against defendant FCI. 10 b. Plaintiffs’ eleventh, twelfth, fourteenth, and fifteenth causes of action are 11 dismissed with leave to amend insofar as they are asserted against 12 defendant FCI. 13 2. Within 45 days of the date of this order, plaintiffs shall file either an amended 14 complaint in accordance with this order or a request for voluntary dismissal of this 15 action pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(i). 16 3. Defendant FCI’s motion to strike (ECF No. 9) is denied. 17 4. Defendant SN Servicing Corporation’s motion to dismiss the complaint (ECF No. 18 19 20 21 22 20) is denied as moot. 5. The March 16, 2017 initial scheduling conference is vacated. The court will reschedule this conference at a later date if the court deems it necessary. IT IS SO ORDERED. Dated: January 23, 2017 23 24 25 26 27 28 22

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