Berkeley v. Wells Fargo Bank

Filing 32

ORDER by Magistrate Judge Jacqueline Scott Corley granting 16 Motion to Dismiss (ahm, COURT STAFF) (Filed on 6/23/2015)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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THERESA BERKLEY, et al.,

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Case No. 15-cv-00749-JSC

Plaintiffs,
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v.

GRANTING MOTION TO DISMISS

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WELLS FARGO BANK,

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Re: Dkt. No. 16

Defendant.

United States District Court
Northern District of California

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Plaintiffs Tim, Maria, and Theresa Berkley bring this action challenging the activities of

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Defendant Wells Fargo (“Defendant”) in relation to a residential mortgage loan.1 Now pending

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before the Court is Defendant’s motion to dismiss Plaintiffs’ First Amended Complaint (“FAC”),

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which brings four causes of action: (1) breach of the covenant of good faith and fair dealing; (2)

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breach of contract; (3) violation of the Federal Rule of Bankruptcy Procedure 3200.1(b); and (4)

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violation of the Unfair Business Practices Act, Cal. Bus. & Prof. Code § 17200. (Dkt. Nos. 15,

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16.) The Court heard oral argument on the motion on June 18, 2015. For the reasons stated on the

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record in open court at that hearing, the Court GRANTS Defendant’s motion to dismiss as set

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forth below.
The Court dismisses Tim and Maria from this action without prejudice. Plaintiffs shall

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have leave to file a Second Amended Complaint (“SAC”) to allege facts that plausibly establish

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that Tim and Maria are proper parties to each cause of action which they bring as plaintiffs. To

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this end, the SAC must specify which causes of action, if any, these plaintiffs bring.
With respect to Theresa, the Court orders as follows. First, the Court dismisses the first

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Because Plaintiffs share the same surname, this Order refers to them by their first names.

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and second causes of action. In light of judicially noticeable documents, Plaintiffs fail to plausibly

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allege that Theresa was not in breach of the contract during and after the course of the

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bankruptcy—such a breach would prevent her from bringing a breach of contract claim. See

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Labra v. Cal-Western Reconveyance Corp., No. C 09-2537 PJH, 2010 WL 889537, at *9 (N.D.

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Cal. Mar. 11, 2010). In particular, in Exhibit L to Defendant’s Request for Judicial Notice,

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Theresa’s bankruptcy counsel appears to acknowledge that Theresa is in arrears by at least

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$100,000 post bankruptcy petition. Nothing in the FAC explains why, in light of this admission,

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she in fact was not in breach of the contract. The FAC similarly alleges that during her

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bankruptcy Defendant did not give her any notice that her mortgage payment had increased.
Again, judicially noticeable pleadings from Theresa’s bankruptcy show that Defendant in fact

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United States District Court
Northern District of California

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asserted in the bankruptcy that Theresa’s payment had increased. In the SAC Theresa must

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therefore more clearly explain the basis for her breach of contract claim.

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Second, the Court dismisses the third cause of action because Plaintiffs err in bringing an

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alleged violation of a Federal Rule of Bankruptcy Proceeding as a separate cause of action. See

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Fed. R. Bankr. Proc. 3002.1(i). This cause of action is dismissed without leave to amend.

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Lastly, the Court dismisses the fourth cause of action for failure to allege sufficient monetary or

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property loss. See Kwikset Corp. v. Sup. Ct., 51 Cal. 4th 310, 321 (2011) (quoting Cal. Bus. &

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Prof. Code § 17204). Payment of attorney’s fees is not sufficient. See Cordon v. Wachovia

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Mortg., a Div. of Wells Fargo Bank, N.A., 776 F. Supp. 2d 1029, 1039 (N.D. Cal. 2011) (declining

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to recognize attorney fees as monetary damages for purposes of a California UCL claim).

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The Court grants Plaintiffs leave to file an amended complaint consistent with this Order
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on or before July 13, 2015. The Court will set a date for an initial case management conference
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after the pleadings are settled.
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This Order disposes of Docket No. 16.
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IT IS SO ORDERED.
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Dated: June 23, 2015
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________________________
JACQUELINE SCOTT CORLEY
United States Magistrate Judge

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United States District Court
Northern District of California

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