Martinez v. Wells Fargo Bank, NA et al

Filing 36

ORDER DENYING PRELIMINARY INJUNCTION. Signed by Judge Richard Seeborg on 9/6/11. (cl, COURT STAFF) (Filed on 9/6/2011)

**E-filed 9/6/11**

1
2
3
4
5
6

IN THE UNITED STATES DISTRICT COURT

7

FOR THE NORTHERN DISTRICT OF CALIFORNIA

8

SAN FRANCISCO DIVISION

9

11
For the Northern District of California

United States District Court

10

12
13
14

VICTORIA ANNE MARTINEZ,
Plaintiff,
v.

No. C 11-1712 RS
ORDER DENYING PRELIMINARY
INJUNCTION

WELLS FARGO BANK N.A., et al.,
Defendants.
____________________________________/

15
16

Plaintiff’s motion for a preliminary injunction to restrain defendants from conducting a

17

trustee’s sale of the real property in dispute in this action will be denied. A plaintiff seeking

18

preliminary relief must “establish that he is likely to succeed on the merits, that he is likely to suffer

19

irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor,

20

and that an injunction is in the public interest.” Winter v. N.R.D.C., Inc., 129 S.Ct. 365, 374 (2008).

21

The Ninth Circuit has clarified, however, that courts in this circuit should still evaluate the

22

likelihood of success on a “sliding scale.” Alliance for Wild Rockies v. Cottrell, 632 F.3d 1127,

23

1134 (9th Cir. 2011) (“[T]he ‘serious questions’ version of the sliding scale test for preliminary

24

injunctions remains viable after the Supreme Court’s decision in Winter.”) As quoted in Cottrell,

25

that test provides that, “[a] preliminary injunction is appropriate when a plaintiff demonstrates . . .

26

that serious questions going to the merits were raised and the balance of hardships tips sharply in the

27

plaintiff’s favor,” provided that the other Winter factors are also satisfied. Id. at 1135.

28

1

Here, plaintiff has made an inadequate showing of a likelihood of success on the merits,

2

even on a sliding scale. Plaintiff places heavy emphasis on Boschma v. Home Loan Center, Inc.,

3

2011 WL 3486440 (Cal. App. 4th Dist. 2011), in which plaintiffs were held to have stated a viable

4

claim for a lender’s failure to disclose adequately that negative amortization was certain to occur if

5

the borrowers made only the minimum monthly payments required under the terms of certain

6

“option adjustable rate mortgages.” Boschma, however, identified the “root of the alleged

7

deficiencies” as the use of a “teaser” rate, which is not present in this case. Additionally, while the

8

loan in issue here similarly gave plaintiff the choice of making payments that would result in

9

negative amortization, plaintiff has not shown that the disclosures made to her were as deficient as

11
For the Northern District of California

United States District Court

10

those alleged in Boschma.
More fundamentally, the Boschma court expressly noted that it was only evaluating the

12

sufficiency of the complaint for pleading purposes, and it expressly pointed out several challenges

13

the plaintiffs would have in attempting to prove their claims. See id. at *12 (“If plaintiffs can show

14

defendant intentionally used its Option ARM forms to deceive borrowers, plaintiffs may be able to

15

establish a fraud claim.” (emphasis added)); id at *14 (“Plaintiffs' theory of damages (lost home

16

equity) is problematic.). On the record here, plaintiff faces substantial hurdles to establish that she

17

was actually misled and damaged by the alleged inadequacies in the loan disclosures.

18

Finally, plaintiff’s contentions that the sale cannot properly go forward either in light of the

19

Mandrigues class action settlement or as the result of purported defects in the foreclosure process

20

are not persuasive. Accordingly, the motion for preliminary injunction is denied, and the temporary

21

restraining order previously issued is hereby lifted.

22
23

IT IS SO ORDERED.

24
25
26

Dated: 9/6/11
RICHARD SEEBORG
UNITED STATES DISTRICT JUDGE

27
28

2