Owens et al v. Bank of America et al

Filing 12

ORDER by Judge Edward M. Chen granting 2 Plaintiffs' Motion for TRO (emclc1, COURT STAFF) (Filed on 9/16/2011)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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JOANN R. OWENS, et al.,

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Plaintiffs,

For the Northern District of California

United States District Court

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No. C-11-4580 EMC

v.

ORDER GRANTING PLAINTIFFS’
MOTION FOR TEMPORARY
RESTRAINING ORDER; AND ORDER
TO SHOW CAUSE

BANK OF AMERICA, et al.,

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Defendants.
(Docket No. 2)

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___________________________________/
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Plaintiffs Joann R. Owens and Larry M. Owens have filed suit against Defendants Bank of

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America, Matrix Servicing, LLC, and J.P. Morgan Mortgage Acquisition Corp., asserting claims for,

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inter alia, breach of contract and fraud. Currently pending before the Court is Plaintiffs’ motion for

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a temporary restraining order, in which they seek to enjoin a foreclosure sale of their home,

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scheduled for September 19, 2011. Having considered the papers submitted, the Court hereby

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GRANTS Plaintiffs’ motion.

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I.
A.

DISCUSSION

Notice
As a preliminary matter, the Court must address whether notice of Plaintiffs’ motion was

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given to Defendants. Having reviewed the Hochhausen declaration and the supplemental

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Hochhausen declaration, the Court finds that oral notice was given to Defendants. See Fed. R. Civ.

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P. 65(b)(1) (referring to issuance of a TRO without written or oral notice). Moreover, both oral and

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written notice were given to Quality Loan Services Corp., which appears to be an agent for at least

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some of the defendants.1 In spite of the notice, no Defendant has indicated to Plaintiffs, either

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directly or through Quality Loan, that they intend to oppose the request for relief. Nor has any

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Defendant made an appearance in this action to respond to Plaintiffs’ request for a TRO.

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B.

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TRO Factors
Preliminary injunctive relief may be issued where (1) irreparable harm is likely to result in

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the absence of such relief, (2) serious questions going to the merits are raised, (3) the balance of

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hardships tips sharply in the plaintiff’s favor, and (4) an injunction is in the public interest. See

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Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1132 (9th Cir. 2011).

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In the instant case, each of the above factors has been satisfied. As indicated above,
Plaintiffs will suffer irreparable harm without a TRO because, without a TRO, their home will be

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For the Northern District of California

United States District Court

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sold. In addition, there are serious questions going to the merits on the claim for breach of contract.

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Although Plaintiffs appear to have returned the modification agreement in an untimely manner, see

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Owens Decl., Ex. 1 (letter) (indicating that return within seven days from the date of the letter is

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required or the offer “will expire automatically without further notice”), Defendants arguably

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waived their right to challenge Plaintiffs’ late acceptance by accepting in turn – and without any

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objection – the initial check that Plaintiffs sent as the “mortgagor contribution” as well as

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subsequent checks that Plaintiffs sent in the amount of the modified monthly mortgage. See Owens

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Decl. ¶¶ 11-12. Alternatively, Plaintiffs’ return of the modification agreement with their signatures

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plausibly constituted a new offer which Defendants accepted by accepting the “mortgagor

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contribution” check described above. Third, the balance of hardships tips sharply in Plaintiffs’ favor

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because they face the prospect of losing their home. In contrast, Defendants contemplate only

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monetary loss (resulting from a mere delay in sale), which can be ameliorated with the posting of an

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undertaking. Finally, a TRO is in the public interest precisely because of the serious questions

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raised which make the foreclosure sale questionable.

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Quality Loan was listed as the entity requesting the recording of the notice of trustee’s sale.
See Owens Decl., Ex. 4 (notice).

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C.

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Terms of TRO
Because the above factors have been satisfied, the Court shall issue a TRO. The TRO bars

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Defendants, as well as their agents, assigns, and those acting in concert with Defendants, from

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selling or attempting to sell the real property owned by Plaintiffs commonly known as 220

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Johnstone, San Rafael, California 94903.

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The TRO is effective upon the filing of this order. By September 19, 2011, Plaintiffs shall

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post an undertaking in the amount of $2,727.12. See Owens Decl. ¶ 12 (stating that this amount was

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the monthly mortgage agreed upon by the parties in the October 2009 modification agreement).

no later than September 20, 2011. Plaintiffs shall serve Defendants directly, and not simply through

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For the Northern District of California

The TRO, as well as Plaintiffs’ papers in support of the TRO, shall be served on Defendants

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United States District Court

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another entity such as Quality Loan. A proof(s) of service shall be filed by September 21, 2011.

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The TRO shall expire on September 30, 2011.
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Order to Show Cause
Finally, Defendants are hereby ordered to show cause why a preliminary injunction should

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not be ordered enjoining Defendants, as well as their agents, assigns, and those acting in concert

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with Defendants, from selling or attempting to sell the real property owned by Plaintiffs commonly

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known as 220 Johnstone, San Rafael, California 94903.

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Defendants’ response to this order to show cause must be filed and served by September 26,
2011.
A hearing on the order to show cause shall be held on September 30, 2011, at 1:30 p.m. in
Courtroom 5, 17th floor, 450 Golden Gate Avenue, San Francisco, California 94102.

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This order disposes of Docket No. 2.

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IT IS SO ORDERED.

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Dated: September 16, 2011

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_________________________
EDWARD M. CHEN
United States District Judge

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