Hoyt et al v. Ocwen Loan Servicing, LLC et al

Filing 40

Order by Hon. Vince Chhabria granting 25 Motion to Dismiss.(vclc2S, COURT STAFF) (Filed on 5/17/2016)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA

RAYMOND L. HOYT, et al.,

Case No. 15-cv-05422-VC

Plaintiffs,
ORDER GRANTING MOTION TO
DISMISS

v.
OCWEN LOAN SERVICING, LLC, et al.,

Re: Dkt. No. 25

Defendants.
Defendants Ocwen Loan Servicing, LLC and Bank of America, N.A. filed a motion to
dismiss for failure to state a claim on March 14, 2016. The Hoyts' response to the motion was
due on March 28, 2016, but they did not file a timely response (or even a request for additional
time to respond). Nor did the Hoyts file a timely response after the Court ordered them to do so
by April 25, 2016. In fact, the plaintiffs' response was not entered on the docket until May 4,
2016, the day before the hearing on the motion to dismiss. To make matters worse, the Hoyts
did not attend the hearing. In light of the Court's inclination to give pro se litigants the benefit of
the doubt, the Court has considered the plaintiffs' opposition brief this time. But the Hoyts are
now on notice that the Court will no longer consider submissions that are untimely or otherwise
improperly filed.
The complaint first alleges that the defendants have violated various provisions of the
Fair Debt Collection Practices Act, 15 U.S.C. § 1692. Conduct contemplated by California's
statutory nonjudicial foreclosure scheme is not actionable "debt collection" within the meaning
of the FDCPA. But that doesn't mean any and all activity somehow related to a foreclosure is
exempt from the FDCPA. Natividad v. Wells Fargo Bank, N.A., No. 3:12-CV-03646 JSC, 2013
WL 2299601, at *8 (N.D. Cal. May 24, 2013) ("[W]hile the Court rejects Plaintiffs' argument to

the extent they assert that all actions related to nonjudicial foreclosure are considered debt
collection, the Court also rejects Defendants' argument to the extent they contend that any action
related to a nonjudicial foreclosure cannot be considered debt collection."). Even in the context
of a foreclosure, allegations of conduct beyond what is contemplated by the statutory foreclosure
scheme could potentially state a claim under the FDCPA. Id. at *9; see also Castellanos v.
Countrywide Bank NA, No. 15-CV-00896-BLF, 2015 WL 3988862, at *3 (N.D. Cal. June 30,
2015) ("Defendants argue, however, that all of Plaintiff's FDCPA . . . claims are barred because
they arise from 'foreclosure activities.' This is not so — Plaintiff alleges violations of the
FDCPA . . . beyond foreclosure activities, including harassing conduct in an attempt to collect on
a debt and furnishing deceptive documentation in an attempt to collect on a debt." (citations
omitted)).
The factual allegations of the Hoyts' complaint are sparse, but the main theme is that the
defendants attempted to foreclose on the plaintiffs' mortgage without having a right to do so. In
light of the judicially noticeable materials attached the defendants' motion, which establish a
chain of title for the Hoyts' deed of trust from their lender to the defendants, it appears the
defendants were entitled to foreclose on the plaintiffs' mortgage. E.g., Defs.' RJN, Ex. C
(assignment of plaintiff's deed of trust by Bank of America, N.A., as successor by merger of
previous assignee); id., Ex. E (assignment of plaintiffs' deed of trust prepared by Ocwen Loan
Servicing); see Cal. Civ. Code § 2924(a)(1); Lane v. Vitek Real Estate Indus. Grp., 713 F. Supp.
2d 1092, 1099 (E.D. Cal. 2010) (observing, in the course of dismissing a wrongful foreclosure
claim, that "[t]here is no stated requirement in California's non-judicial foreclosure scheme that
requires a beneficial interest in the Note to foreclose . . . the statute broadly allows a trustee,
mortgagee, beneficiary, or any of their agents to initiate non-judicial foreclosure"). In their
opposition to the motion to dismiss, the Hoyts suggest the defendants engaged in activity
(beyond statutorily contemplated foreclosure) that is potentially prohibited by the FDCPA. But
the allegations in the complaint are too vague and conclusory to support a plausible inference
that the defendants violated the FDCPA. See Castellanos, 2015 WL 3988862, at *3; Natividad,

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2013 WL 2299601, at *9. Because, in its current form, the complaint doesn't adequately allege
anything more than the conduct contemplated by California's statutory foreclosure scheme, the
plaintiffs haven't stated an FDCPA claim.1
The complaint also alleges that the defendants committed "identity theft." The plaintiffs'
opposition doesn't address the moving defendants' arguments for dismissing these claims.
Moreover, on its face, the complaint does not appear to state a claim for identity theft. The
complaint recites boilerplate descriptions of various identity theft schemes, but it does not
include any facts that support a plausible inference that the defendants engaged in any wrongful
conduct — particularly since, to the extent it sounds in fraud, an "identity theft" claim is likely
subject to the heightened pleading standard of Federal Rule of Civil Procedure 9(b).
The plaintiffs' claims against the moving defendants are dismissed. Any amended
complaint must be filed within 21 days of this order.
IT IS SO ORDERED.
Dated: May 17, 2016
______________________________________
VINCE CHHABRIA
United States District Judge

1

In light of the conclusion that the complaint fails to state an FDCPA claim against either
moving defendant, the Court need not reach Bank of America's argument that the FDCPA claim
against it is time-barred.

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