Del Rosario v. Yakte Properties, LLC, et al

Filing 9

ORDER signed by Chief District Judge Kimberly J. Mueller on 9/8/2021 GRANTING #5 Motion to Dismiss, and any Amended Complaint must be filed within 30 days. Initial Scheduling Conference Reset for 10/28/2021 at 02:30 PM in Courtroom 3 (KJM) before Chief District Judge Kimberly J. Mueller. (Reader, L)

Case 2:21-cv-01304-KJM-JDP Document 9 Filed 09/09/21 Page 1 of 4
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UNITED STATES DISTRICT COURT

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FOR THE EASTERN DISTRICT OF CALIFORNIA

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Imelda Del Rosario,

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No. Case 2:21-cv-01304-KJM-JDP
Plaintiff,

ORDER

v.
Yakte Properties, LLC, et al.,
Defendants.

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Plaintiff Imelda Del Rosario alleges the defendants in this case went back on promises,

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made misrepresentations, and violated California and federal law in connection with a notice of a

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default and notice of trustee’s sale. See generally Compl., Notice of Removal Ex. A, ECF No. 1.

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Defendant Yakte Properties, LLC moves to dismiss the complaint for failure to state a claim

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under Rule 12(b)(6). See generally Mot., ECF No. 5; Mem., ECF No. 6. The motion is

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unopposed, and as explained in this order, it is granted with leave to amend.

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A motion to dismiss for failure to state a claim under Rule 12(b)(6) may be granted if the

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complaint’s allegations do not “plausibly give rise to an entitlement to relief.” Ashcroft v. Iqbal,

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556 U.S. 662, 679 (2009). The complaint need contain only a “short and plain statement of the

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claim showing that the pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2), not “detailed factual

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allegations,” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). But this rule demands more

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than unadorned accusations; “sufficient factual matter” must make the claim at least plausible.
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Case 2:21-cv-01304-KJM-JDP Document 9 Filed 09/09/21 Page 2 of 4
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Iqbal, 556 U.S. at 678. Conclusory or formulaic recitations of elements do not alone suffice. Id.

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(quoting Twombly, 550 U.S. at 555).

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The complaint’s first claim is for promissory estoppel. See Compl. ¶¶ 28–34. That claim

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is based on Ms. Del Rosario’s allegation that Yakte broke its promise “to send [her]

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documentation confirming the debt and providing [her] with loss mitigation options.” Id. ¶ 29.

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Earlier in the complaint, however, she alleges Yakte did not give notice that it had acquired an

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interest in her loans, did not tell her it was servicing her loans, and did not respond to her requests

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for documents or information. See id. ¶¶ 18–24. These contradictory allegations do not permit

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the court to infer that Yakte made a clear and unambiguous promise, which is an essential

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element of any claim for promissory estoppel. See, e.g., Aceves v. U.S. Bank, N.A., 192 Cal. App.

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4th 218, 226 (2011). This claim is dismissed.

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The second claim is for wrongful foreclosure. See Compl. ¶¶ 35–41. A claim for

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wrongful foreclosure has three elements: “(1) the trustee or mortgagee caused an illegal,

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fraudulent, or willfully oppressive sale of real property pursuant to a power of sale in a mortgage

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or deed of trust; (2) the party attacking the sale (usually but not always the trustor or mortgagor)

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was prejudiced or harmed; and (3) in cases where the trustor or mortgagor challenges the sale, the

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trustor or mortgagor tendered the amount of the secured indebtedness or was excused from

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tendering.” Miles v. Deutsche Bank Nat’l Tr. Co., 236 Cal. App. 4th 394, 408 (2015) (quoting

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Lona v. Citibank, N.A., 202 Cal. App. 4th 89, 104 (2011)). “[M]ere technical violations of the

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foreclosure process will not give rise to a tort claim; the foreclosure must have been entirely

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unauthorized on the facts of the case.” Id. Ms. Del Rosario does not allege a sale has occurred,

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does not allege she “tendered the amount of the secured indebtedness” or was “excused from

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tendering” and why, and does not allege facts that, if true, would show the foreclosure was

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“entirely unauthorized.” This claim is dismissed.

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The third claim is for negligent misrepresentation. See Compl. ¶¶ 42–46. Ms. Del

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Rosario alleges the defendants “made representations to [her] that they knew or should have

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known were false.” Id. ¶ 43. She does not say what those representations were. Such a cursory

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Case 2:21-cv-01304-KJM-JDP Document 9 Filed 09/09/21 Page 3 of 4
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allegation does not state a claim for negligent misrepresentation. See, e.g., Puri v. Khalsa,

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674 F. App’x 679, 689 (9th Cir. 2017) (unpublished). This claim is dismissed.

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The fourth claim is for violation of California Business and Professions Code section

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17200, the Unfair Competition Law. See Compl. ¶¶ 47–67. This claim rests on the same

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allegations as the previous three claims, which do not permit plausible inferences of unlawful,

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unfair, or fraudulent practices. See Cal. Bus. & Prof. Code § 17200 (defining “unfair

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competition” to include “any unlawful, unfair, or fraudulent business act or practice”). This claim

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is dismissed.

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The fifth claim rests on California Civil Code section 2924.17. See Compl. ¶¶ 68–79.

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Section 2924.17 requires notices of default and foreclosure sales to be “accurate and complete

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and supported by competent and reliable evidence.” Cal. Civ. Code § 2924.17(a). It also requires

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“a mortgage servicer” to “ensure that it has reviewed competent and reliable evidence to

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substantiate the borrower’s default and the right to foreclose” before filing or recording the

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notice. Id. § 2924.17(b). Ms. Del Rosario alleges Yakte did not correctly calculate the amount

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due on her loan because the loan was “charged off” by an unnamed third party sometime between

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2013 and 2018. See id. ¶¶ 16, 71–78. This vague allegation does not permit the court to infer that

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Yakte or another entity violated section 2924.17. This claim is dismissed. The court need not

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and does not decide whether Yakte can be liable for violations of this section even if it was not a

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mortgage servicer. See Mem. at 12–13. Nor has the court determined whether Ms. Del Rosario

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can pursue a claim under section 2924.17 before a foreclosure sale. Cf. Lucioni v. Bank of Am.,

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N.A., 3 Cal. App. 5th 150, 163 (2016) (“Sections 2924.17 and 2923.55 do not create a right to

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litigate, preforeclosure, whether the foreclosing party’s conclusion that it had the right to

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foreclose was correct.” (emphasis in original)).

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The sixth claim cites federal regulations requiring monthly statements on closed-end

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consumer credit. See Compl. ¶¶ 80–86 (citing 12 C.F.R. § 1026.41). Ms. Del Rosario’s

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complaint refers to a revolving line of credit. See id. ¶¶ 12, 82–85 & Ex. A at 2. The regulation

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cited in her complaint does not apply to a revolving line of credit. See Taylor v. Bosco Credit,

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Case 2:21-cv-01304-KJM-JDP Document 9 Filed 09/09/21 Page 4 of 4
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LLC, No. 18-06310, 2018 WL 6511150, at *2 (N.D. Cal. Dec. 11, 2018) (comparing 12 C.F.R.

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§§ 1026.41 and 1026.7). This claim is dismissed.

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The seventh claim is for violation of the Federal Fair Debt Collection Practices Act and

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California’s Rosenthal Fair Debt Collection Practices Act. See Compl. ¶¶ 87–94. Ms. Del

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Rosario alleges Yakte misrepresented the amount of her debt by including unspecified “interest

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and fees” that it was “federally prohibited from collecting” under unspecified laws, and she

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alleges Yakte “made other false statements.” Id. ¶¶ 90–91. These allegations are too vague to

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permit an inference of Yakte’s liability. This claim is dismissed. The court need not and does not

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consider whether this claim is subject to a defense based on the statute of limitations or whether

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the complaint adequately alleges that Yakte was a “debt collector” under the terms of federal or

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state law. See Mem. at 14.

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The motion to dismiss is thus granted. Because the shortcomings identified in this

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order could potentially be corrected by the addition of factual allegations or by reliance on an

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alternative statutory or regulatory basis, the motion is granted with leave to amend. See Sonoma

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Cty. Ass’n of Retired Emps. v. Sonoma Cty., 708 F.3d 1109, 1117–18 (9th Cir. 2013). Any

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amended complaint must be filed within thirty days.

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The parties have not filed a joint status report as required in advance of the upcoming

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status (pretrial scheduling) conference. See Min. Order, ECF No. 8. That conference is thus

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vacated and reset for October 28, 2021 at 2:30 p.m. before the undersigned.

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This order resolves ECF No. 5.

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IT IS SO ORDERED.

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DATED: September 8, 2021.

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