Zacharias v. JP Morgan Chase Bank, N.A. et al

Filing 49

Order by Hon. Samuel Conti granting in part and denying in part 40 Motion to Dismiss.(sclc1, COURT STAFF) (Filed on 8/29/2013)

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1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE NORTHERN DISTRICT OF CALIFORNIA 8 United States District Court For the Northern District of California 9 REYNA U. ZACHARIAS, 10 Plaintiff, 11 v. 12 13 JP MORGAN CHASE BANK, N.A., BANK OF AMERICA, N.A., Defendants. 14 ) ) ) ) ) ) ) ) ) ) ) Case No. 12-06525 SC ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS AMENDED COMPLAINT 15 16 I. INTRODUCTION Plaintiff Reyna U. Zacharias ("Plaintiff") brings this action 17 18 against JP Morgan Chase Bank, N.A. ("Chase") and Bank of America, 19 N.A. ("BofA") (collectively, "Defendants") in connection with 20 foreclosure proceedings commenced against her San Francisco home. 21 Defendants now move to dismiss Plaintiff's first amended complaint 22 ("1AC"). 23 appropriate for resolution without oral argument per Civil Local 24 Rule 7-1(b). 25 set forth below, the motion to dismiss is GRANTED in part and 26 DENIED in part. 27 /// 28 /// ECF No. 41 ("MTD"). The Motion is fully briefed and ECF Nos. 45 ("Opp'n"), 48 ("Reply"). For the reasons 1 II. BACKGROUND 2 In April 2007, Plaintiff obtained a loan from Washington 3 Mutual Bank, F.A. ("WaMu"), secured by a deed of trust (the "DOT") 4 encumbering her San Francisco home. 5 No. 42 (Request for Judicial Notice ("RJN")) Ex. 1 ("DOT").1 6 DOT identifies WaMu as the beneficiary and indicates that WaMu lent 7 Plaintiff $947,500. 8 Reconveyance Company ("CRC") as the trustee. ECF No. 31 ("1AC") ¶ 9; ECF The The DOT also identifies California The federal government later closed WaMu and appointed the 9 United States District Court For the Northern District of California 10 Federal Deposit Insurance Corporation ("FDIC") as the bank's 11 receiver. 12 2008, Chase acquired certain assets and liabilities of WaMu through 13 an asset purchase agreement with the FDIC. 14 2009, an "Assignment of Deed of Trust" was recorded with the San 15 Francisco Assessor-Recorder. 16 Assignment"). 17 interest to WaMu, assigned its interest in the DOT to BofA. 18 Assignment. See RJN Ex. 2 ("Purchase Agreement"). Id. On September 25, On September 21, 1AC ¶ 10; RJN Ex. 3 ("DOT The document states that Chase, as successor in DOT A notice of default was also recorded on September 21, 2009, 19 20 indicating that Plaintiff was $13,873.88 in arrears on her loan 21 1 22 23 24 25 26 27 28 Plaintiff's objections to Defendants' RJN, ECF No. 46, are OVERRULED, and the Court takes judicial notice of the DOT and the other publicly filed documents attached to the RJN, but not the truth of the matters asserted by those documents. Pursuant to Federal Rule of Evidence 201, the Court may take judicial notice of "a fact that is not subject to reasonable dispute" because, among other things, it "can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." Accordingly, the Court "may properly take notice of public facts and public documents." Cactus Corner, LLC v. U.S. Dept. of Agric., 346 F. Supp. 2d 1075, 1098 (E.D. Cal. 2004). Additionally, Plaintiff references many of the documents attached to the RJN in her complaint and, under the "incorporation by reference doctrine," a court may properly consider such documents. See Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005). 2 1 payments. 2 recorded, the first on December 23, 2009, and the second on 3 November 5, 2012. 4 a trustee's sale was scheduled for November 26, 2012, and the 5 unpaid balance and other charges on Plaintiff's loan totaled 6 $1,082,141.68. 7 occurred. Two notices of trustee's sale were later RJN Exs. 5, 6. According to the second notice, It is unclear whether the trustee's sale has yet On November 19, 2012, Plaintiff filed the instant action in 8 9 RJN Ex. 4. California Superior Court and the case was subsequently removed on United States District Court For the Northern District of California 10 diversity and federal question grounds. ECF No. 1 Ex. 1 11 ("Compl."). 12 of title, (2) wrongful foreclosure, and (3) violation of the RICO 13 statute. 14 to dismiss, which the Court granted on February 13, 2013. 15 29. 16 Court granted Plaintiff leave to amend her claims for slander of 17 title and wrongful foreclosure. Plaintiff asserted three causes of action: (1) slander Compl. ¶¶ 15-57. Defendants subsequently filed a motion ECF No. Plaintiffs' RICO claim was dismissed with prejudice, but the Plaintiff subsequently filed her 1AC, alleging causes of 18 19 action for: (1) slander of title; (2) wrongful foreclosure; (3) 20 violation of California Civil Code section 2923.5; (4) violation of 21 the Truth in Lending Act ("TILA"), 15 U.S.C. § 1601; and (5) 22 violation of the California Unfair Competition Law ("UCL"), Cal. 23 Bus. & Prof. Code § 17200.2 24 /// 25 /// 26 /// 27 2 28 The Court did not grant Plaintiff leave to amend her pleadings to assert new causes of action for violations of section 2923.5, TILA, and the UCL. 3 1 III. LEGAL STANDARD A motion to dismiss under Federal Rule of Civil Procedure 2 3 12(b)(6) "tests the legal sufficiency of a claim." Navarro v. 4 Block, 250 F.3d 729, 732 (9th Cir. 2001). 5 on the lack of a cognizable legal theory or the absence of 6 sufficient facts alleged under a cognizable legal theory." 7 Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 8 1988). 9 should assume their veracity and then determine whether they "Dismissal can be based "When there are well-pleaded factual allegations, a court United States District Court For the Northern District of California 10 plausibly give rise to an entitlement to relief." Ashcroft v. 11 Iqbal, 556 U.S. 662, 664 (2009). 12 must accept as true all of the allegations contained in a complaint 13 is inapplicable to legal conclusions. 14 elements of a cause of action, supported by mere conclusory 15 statements, do not suffice." 16 v. Twombly, 550 U.S. 544, 555 (2007)). 17 complaint must be both "sufficiently detailed to give fair notice 18 to the opposing party of the nature of the claim so that the party 19 may effectively defend against it" and "sufficiently plausible" 20 such that "it is not unfair to require the opposing party to be 21 subjected to the expense of discovery." 22 1191, 1204 (9th Cir. 2011). However, "the tenet that a court Threadbare recitals of the Id. at 663. (citing Bell Atl. Corp. The allegations made in a Starr v. Baca, 633 F.3d 23 24 25 IV. DISCUSSION Defendants' motion asserts a number of arguments in favor of 26 dismissing each of Plaintiff's claims. 27 an opposition brief, the Court can only assume that Plaintiff's 28 counsel did not draft the brief with Defendants' motion in mind. 4 Though Plaintiff has filed 1 Large segments of the opposition brief are identical to the 2 opposition brief Plaintiff filed in response to Defendants' 3 previous motion to dismiss. 4 the arguments asserted by Defendants, while responding to other 5 arguments that Defendants do not make. 6 as to defend claims that were never asserted in Plaintiff's 7 pleading and to characterize Defendants' Rule 12(b)(6) motion to 8 dismiss as a state law demurrer. 9 indicate that Plaintiff's counsel even reviewed Defendants' moving United States District Court For the Northern District of California 10 Moreover, Plaintiff ignores most of The brief also goes so far In short, there is little to papers before filing their opposition. 11 In light of Plaintiff's failure to file a coherent opposition, 12 the Court is inclined to agree with most of the arguments raised in 13 Defendants' motion. 14 arguments raised in the motion to dismiss and finds as follows: The Court assumes familiarity with the 15 16 • Plaintiff's claims are DISMISSED WITH PREJUDICE to the extent 17 that they are premised on the assertion that securitization of 18 the loan rendered the DOT unenforceable. 19 • Plaintiff's claim for slander of title is time barred to the 20 extent it is predicated on the DOT, the assignment of the DOT, 21 and the notice of default. 22 that Plaintiff may show why the statute of limitation should 23 be tolled. 24 • The Court grants leave to amend so Plaintiff's claim for slander of title is also DISMISSED to 25 the extent that it is predicated on the recordation of the 26 first and second notices of trustee's sale. 27 granted leave to amend to allege facts showing (1) Margaret 28 Flynn is a robo-signer or otherwise lacked authority to sign 5 Plaintiff is 1 the notice of default, or (2) that CRC is not the rightful 2 trustee on the DOT. 3 • Plaintiff's claim for wrongful foreclosure is DISMISSED 4 because Plaintiff has failed to allege a foreclosure sale. 5 The Court grants Plaintiff leave to amend so that she may 6 allege whether and when the foreclosure sale occurred. 7 • Defendants' motion to dismiss Plaintiff's claim for violation 8 of California Civil Code section 2923.5 is DENIED. Defendants 9 are correct that a number of judges in this district have held See Capodiece v. United States District Court For the Northern District of California 10 that section 2923.5 is preempted by HOLA. 11 Wells Fargo Bank, No. C 13-00032 WHA, 2013 U.S. Dist. LEXIS 12 67174 (N.D. Cal. May 9, 2013). 13 held otherwise, and the Ninth Circuit has yet to rule on this 14 issue. 15 920 SC, 2011 WL 2314151, at *4 n.8 (N.D. Cal. June 10, 2011); 16 Pey v. Wachovia Mortgage Corp., 11-2922 SC, 2011 WL 5573894, 17 at *8-9 (N.D. Cal. Nov. 15, 2011). 18 • However, the undersigned has See Shaterian v. Wells Fargo Bank, Nat. Ass'n, C-11- Plaintiff's claim for violation of TILA is DISMISSED as time 19 barred and DISMISSED WITH PREJUDICE to the extent that 20 Plaintiff seeks rescission of her loan. 21 Plaintiff seeks only damages, the Court grants Plaintiff leave 22 to amend to allege why the statute of limitations should be 23 tolled. 24 of TILA violations does not support equitable tolling of 25 TILA's statutes of limitations." 26 5:13-CV-00467-EJD, 2013 WL 3788827, at *3 (N.D. Cal. July 17, 27 2013). To the extent that The Court advises Plaintiff that "the mere existence 28 6 Quach v. Bank of Am., N.A., • 1 Plaintiff's UCL claim is DISMISSED with leave to amend. 2 Plaintiff's amended complaint should specifically identify the 3 prong or prongs of the UCL under which Plaintiff is suing. 4 the extent that Plaintiff alleges a predicate violation of 5 California Civil Code Section 2924, Plaintiff must 6 specifically identify what provisions of the statute were 7 violated. 8 unfairness prong of the UCL, her pleading shall specifically 9 identify how her claim is tethered to specific constitutional, To To the extent that Plaintiff is suing under the See Bardin v. United States District Court For the Northern District of California 10 statutory, or regulatory provisions. 11 Daimlerchrysler Corp., 136 Cal. App. 4th 1255, 1260-61 (Cal. 12 Ct. App. 2006). 13 Plaintiff has suffered a cognizable injury under the UCL. The amended complaint shall also identify how 14 15 16 V. CONCLUSION As set forth above, JP Morgan Chase Bank, N.A. and Bank of 17 America, N.A.'s motion to dismiss Plaintiff Reyna U. Zacharias's 18 complaint is GRANTED in part and DENIED in part. 19 claims for slander of title, wrongful foreclosure, violation of 20 TILA, and violation of the UCL are DISMISSED with leave to amend. 21 Plaintiff's claim for violation of California Civil Code section 22 2923.5 remains undisturbed. 23 pleading within thirty (30) days of the signature date of this 24 Order and that pleading shall comply with the guidance set forth 25 above. 26 defects identified above may result in dismissal with prejudice of 27 some or all of Plaintiff's causes of action. 28 grant Plaintiff leave to amend to assert new causes of action. Plaintiff's Plaintiff shall file her amended Failure to timely file an amended complaint or to cure the 7 The Court does not 1 Plaintiff shall comply with the requirements set forth in Federal 2 Rule of Civil Procedure 15 prior to asserting any new causes of 3 action. 4 kind that Plaintiff submitted in connection with the instant motion 5 to dismiss. 6 counsel shall directly respond to the arguments raised by opposing 7 counsel. 8 their client and, within ten (10) days of the signature date of 9 this Order, shall file a declaration with the Court confirming that United States District Court For the Northern District of California 10 The Court will not entertain any further briefing like the Any future opposition briefs filed by Plaintiff's Plaintiff's counsel shall share a copy of this Order with they have complied with this instruction. 11 12 IT IS SO ORDERED. 13 14 15 Dated: August 29, 2013 UNITED STATES DISTRICT JUDGE 16 17 18 19 20 21 22 23 24 25 26 27 28 8

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