Perdum v. Wells Fargo Bank, N.A.

Filing 64

ORDER by Judge Haywood S. Gilliam, Jr. DENYING 54 MOTION FOR VOLUNTARY DISMISSAL WITH PREJUDICE. (ndrS, COURT STAFF) (Filed on 9/14/2015)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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CYNTHIA D. PERDUM,

Case No. 14-cv-02477-HSG

Plaintiff,
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ORDER DENYING MOTION FOR
VOLUNTARY DISMISSAL WITH
PREJUDICE

v.
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WELLS FARGO BANK, N.A.,

Re: Dkt. No. 54

Defendant.

United States District Court
Northern District of California

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In this case, Plaintiff Cynthia Perdum alleges that Defendant Wells Fargo Bank, N.A.

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violated the False Claims Act (“FCA”) by misappropriating funds provided by the United States

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under the Home Affordable Modification Program (“HAMP”), and by improperly denying her a

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loan modification for a mortgage under the HAMP program. Wells Fargo moved to dismiss for

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failure to state a claim, Dkt. No. 37, and Judge James Donato, to whom this case was previously

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assigned, granted the motion without prejudice on January 5, 2015, Dkt. No. 53. In his order,

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Judge Donato expressly stated that Perdum would be provided “one last opportunity” to file an

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amended complaint by January 12, 2015 or else the case would be dismissed with prejudice.” Id.

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at 4.

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Rather than amend her complaint by the deadline ordered by Judge Donato, Perdum

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instead filed a motion to dismiss her complaint without prejudice. Dkt. No. 54. In that motion,

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Perdum conceded that she could not plead a cause of action under the FCA, but sought dismissal

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without prejudice so that she could bring a claim under the Financial Institutions Reform,

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Recovery, and Enforcement Act (“FIRREA”) at a future date. Id. Perdum represented that her

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failure to bring a FIRREA claim in the first place was caused by the ineffective assistance of her

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counsel. Id. at 4. Wells Fargo opposes Perdum’s motion, arguing that this action should be

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dismissed with prejudice because (1) Perdum failed to comply with Judge Donato’s order; and (2)

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any FIRREA claim brought by Perdum would be futile because only the United States has

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standing to pursue claims under that statute. Dkt. No. 56 at 1-2.

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“Federal Rule of Civil Procedure 41(a)(2) allows a plaintiff, pursuant to an order of the
court, and subject to any terms and conditions the court deems proper, to dismiss an action without

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prejudice at any time.” Westlands Water Dist. v. United States, 100 F.3d 94, 96 (9th Cir. 1996).

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“The purpose of the rule is to permit a plaintiff to dismiss an action without prejudice so long as

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the defendant will not be prejudiced . . . or unfairly affected by dismissal.” Stevedoring Servs. of

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Am. v. Armilla Int’l, B.V., 889 F.2d 919, 921 (9th Cir. 1989) (citations omitted). When

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determining prejudice, a district court may consider such factors as the stage of litigation and the

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moving party’s delay in requesting voluntary dismissal, as well as indications of forum shopping.

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United States District Court
Northern District of California

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See Cent. Mont. Rail v. BNSF Ry. Co., 422 F. App’x 636, 638 (9th Cir. 2011) (citing Westlands

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Water Dist., 100 F.3d at 96; Kern Oil & Refining Co. v. Tenneco Oil Co., 792 F.2d 1380, 1389-90

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(9th Cir. 1986)).

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In this case, the Court finds that granting Perdum’s motion would result in legal prejudice

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to Wells Fargo. This is not a case where “a dispute remains unresolved” or where there is simply

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a “threat of future litigation,” as have been found insufficient grounds for legal prejudice in other

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cases. See, e.g., Westlands Water Dist., 100 F.3d at 96-97. To the contrary, the dispute between

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the parties has been resolved. Judge Donato considered Perdum’s FCA claim when deciding

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Wells Fargo’s motion to dismiss, provided leave to amend, and expressly stated that the action

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would be dismissed with prejudice absent the filing of an amended complaint by January 12, 2015.

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Dkt. No. 53. Perdum did not comply with Judge Donato’s order. In other words, dismissal

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without prejudice would not merely threaten Wells Fargo with future litigation: it would expose

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Wells Fargo to potential re-litigation of issues already decided by this Court. Accordingly,

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Perdum’s motion to voluntarily dismiss this action is DENIED.

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Nevertheless, the Court will exercise its discretion to permit Perdum the opportunity to file

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an amended complaint under FIRREA, to the extent that she can plead a cause of action consistent

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with the requirements of Rule 11. The amended complaint may not assert any other new claims or

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add any new defendants. Perdum must file the amended complaint by no later than 30 days from
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the date of this order. Failure to adhere to this deadline will result in dismissal of this action with

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prejudice.

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IT IS SO ORDERED.
Dated: September 14, 2015
______________________________________
HAYWOOD S. GILLIAM, JR.
United States District Judge

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United States District Court
Northern District of California

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