Marquez et al v. Wells Fargo Bank, N.A. et al

Filing 34

ORDER by Judge Hamilton granting 12 Motion to Dismiss; denying 21 Motion to Remand (pjhlc1, COURT STAFF) (Filed on 9/13/2013)

1
2
3

UNITED STATES DISTRICT COURT

4

NORTHERN DISTRICT OF CALIFORNIA

5
6
7

ROBERTO MARQUEZ, et al.,

8
9

Plaintiffs,

No. C 13-2819 PJH

v.

ORDER GRANTING MOTION
TO DISMISS

WELLS FARGO BANK, N.A.,

11
For the Northern District of California

United States District Court

10

Defendants.
_______________________________/

12
13

The motion of plaintiffs Roberto Marquez and Eduvijes Marquez for an order

14

remanding the above-entitled action to the Superior Court of California, County of San

15

Mateo, and the motion of defendant Wells Fargo Bank, N.A. (“Wells Fargo”), for an order

16

dismissing the complaint for failure to state a claim, came on for hearing before this court

17

on September 4, 2013. Plaintiffs appeared by Zachary Toran, who had not previously

18

entered an appearance in this case, and Wells Fargo appeared by Kenneth Franklin.

19

Having read the parties’ papers and carefully considered their arguments and the relevant

20

legal authority, the court hereby DENIES the motion to remand and GRANTS the motion to

21

dismiss as follows.

22
23

BACKGROUND
On January 3, 2007, plaintiffs borrowed $315,000 from World Savings Bank, FSB

24

(“World Savings”). The loan was memorialized by a promissory note and secured by a

25

Deed of Trust recorded against real property located in East Palo Alto, California (“the

26

property”). World Savings subsequently changed its name to Wachovia Mortgage, FSB,

27

and then to Wells Fargo Bank Southwest, N.A., and in 2009, merged with Wells Fargo.

28

Plaintiffs failed to make the loan payments, thereby defaulting on the loan. A Notice

1

of Default and Election to Sell under Deed of Trust was recorded by Cal Western

2

Reconveyance (“Cal Western”) on April 25, 2013. However, no notice of sale has been

3

recorded, and no date has been set for a foreclosure sale.
Plaintiffs filed the complaint in the present action on May 20, 2013 in San Mateo

4
5

Superior Court, against Wells Fargo and Cal Western. Wells Fargo removed the case on

6

June 19, 2013, alleging diversity jurisdiction. Wells Fargo asserts that plaintiffs are citizens

7

of California and that Wells Fargo is a citizen of South Dakota, the state where its main

8

office (as provided in its Articles of Incorporation) is located. As for Cal Western, Wells

9

Fargo alleges that it is a nominal party (as trustee under the deed of trust), and that it was
fraudulently joined by plaintiffs in an attempt to defeat diversity.

11
For the Northern District of California

United States District Court

10

The gist of plaintiffs’ complaint is that “defendants” failed to comply with certain

12

requirements of the recently enacted “California Homeowner Bill of Rights” (“HBOR”),

13

specifically, California Civil Code §§ 2923.55, 2923.6, 2923.7, and 2924.17, and that the

14

Notice of Default was therefore “defective.”
The complaint alleges six causes of action – (1) violation of Civil Code § 2923.55; (2)

15
16

violation of Civil Code § 2923.6; (3) violation of Civil Code § 2923.7; (4) violation of Civil

17

Code § 2924.17; (5) violation of California Business & Professions Code § 17200; and

18

(6) breach of the implied covenant of good faith and fair dealing. The first five causes of

19

action are asserted against both defendants, and the sixth cause of action is asserted

20

against Wells Fargo only.
Plaintiff now seeks an order remanding the case, and Wells Fargo seeks an order

21
22

dismissing the complaint for failure to state a claim.
DISCUSSION

23
24
25

A.

Motion to Remand
On July 19, 2013, plaintiffs filed a motion to remand, arguing that Wells Fargo’s

26

principal place of business is in California, and that the parties are therefore not completely

27

diverse. Wells Fargo filed its opposition on August 2, 2013, in accordance with the local

28

rules. Plaintiffs’ reply was due on August 9, 2013, but none was filed.
2

1

1.

Legal Standard

2

A defendant may remove a civil action filed in state court if the action could have

3

originally been filed in federal court. 28 U.S.C. § 1441. A plaintiff may seek to have a case

4

remanded to the state court from which it was removed if the district court lacks jurisdiction

5

or if there is a defect in the removal procedure. 28 U.S.C. § 1447(c). The removal statutes

6

are construed restrictively, so as to limit removal jurisdiction. See Shamrock Oil & Gas

7

Corp. v. Sheets, 313 U.S. 100, 108-09 (1941).

8
9

The district court must remand the case if it appears before final judgment that the
court lacks subject matter jurisdiction. 28 U.S.C. 1447(c). There is a “strong presumption”
against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). The

11
For the Northern District of California

United States District Court

10

burden of establishing federal jurisdiction for purposes of removal is on the party seeking

12

removal. Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1117 (9th Cir. 2004). Doubts as to

13

removability are resolved in favor of remanding the case to state court. Matheson v.

14

Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003).

15

2.

16

Plaintiffs argue that the case must be remanded because the court lacks subject

Plaintiffs’ Motion

17

matter jurisdiction – specifically, because the complaint was removed based on diversity

18

jurisdiction, but the parties are not completely diverse. Plaintiffs assert that Wells Fargo is

19

a citizen of both South Dakota (based on articles of incorporation) and California (based on

20

location of financial main office).

21

The court finds that the motion must be DENIED, for the reasons stated at the

22

hearing. In Wachovia Bank v. Schmidt, 546 U.S. 303 (2006), the Supreme Court held that

23

“a national bank, for § 1348 purposes, is a citizen of the State in which its main office, as

24

set forth in its articles of association, is located.” Id. at 307.

25

The parties dispute whether this ruling should be interpreted as meaning that a

26

national bank can be considered a citizen only of the state in which its “main office” is

27

located, or whether it can also be considered a citizen of the state where its “principle place

28

of business” is found. The Ninth Circuit has not ruled on this issue, and district courts in
3

1

California are divided on the question. However, it appears that a substantial majority of

2

district courts have rejected the “dual citizenship” theory.
The court finds, based on the language of Schmidt, that Wells Fargo is a citizen of

3
4

only South Dakota, the state in which its main office is located under its articles of

5

association. See, e.g., Crane v. Wells Fargo, 2013 WL 3802416 (N.D. Cal. July 19, 2013);

6

Alonzo v. Wells Fargo Bank N.A., 2013 WL 3787298 (N.D. Cal. July 18, 2013); Lindberg v.

7

Wells Fargo Bank N.A., 2013 WL 3457078 (N.D. Cal. July 9, 2013). For this reason,

8

plaintiffs and defendant are completely diverse, and the motion to remand is denied.

9

B.

Wells Fargo filed a motion to dismiss on June 26, 2013, and a “corrected” motion to

11
For the Northern District of California

United States District Court

10

Motion to Dismiss

dismiss on June 27, 2013. Under the Civil Local Rules of this court, plaintiffs’ opposition

12

was due no later than July 11, 2013. However, no opposition was filed by that date. On

13

July 16, 2013 (two days before the reply was due), Wells Fargo filed a notice indicating that

14

no opposition had been filed. Plaintiffs finally filed the opposition on July 30, 2013, with no

15

explanation as to why it was not filed on the due date.

16

Because plaintiffs failed to comply with the requirements of Civil Local Rule 7-3,

17

failed to seek leave of court to file a late opposition, and, when specifically queried by the

18

court at the hearing, failed to provide any justification for filing the opposition almost three

19

weeks late, the court finds that the opposition brief must be stricken as untimely, as no

20

reason, much less good cause, has been provided.

21

1.

Legal Standard

22

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests for the legal

23

sufficiency of the claims alleged in the complaint. Ileto v. Glock, Inc., 349 F.3d 1191,

24

1199-1200 (9th Cir. 2003). Review is limited to the contents of the complaint. Allarcom

25

Pay Television, Ltd. v. Gen. Instrument Corp., 69 F.3d 381, 385 (9th Cir. 1995). To survive

26

a motion to dismiss for failure to state a claim, a complaint generally must satisfy only the

27

minimal notice pleading requirements of Federal Rule of Civil Procedure 8, which requires

28

that a complaint include a “short and plain statement of the claim showing that the pleader
4

1

is entitled to relief.” Fed. R. Civ. P. 8(a)(2).
A complaint may be dismissed under Rule 12(b)(6) for failure to state a claim if the

2

a cognizable legal theory. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir.

5

1990). The court is to “accept all factual allegations in the complaint as true and construe

6

the pleadings in the light most favorable to the nonmoving party.” Outdoor Media Group,

7

Inc. v. City of Beaumont, 506 F.3d 895, 899-900 (9th Cir. 2007). Nevertheless, the

8

allegations in the complaint “must be enough to raise a right to relief above the speculative

9

level.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citations and quotations

10

omitted). Legally conclusory statements, not supported by actual factual allegations, need

11
For the Northern District of California

plaintiff fails to state a cognizable legal theory, or has not alleged sufficient facts to support

4

United States District Court

3

not be accepted. Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009).

12

A motion to dismiss should be granted if the complaint does not proffer enough facts

13

to state a claim for relief that is plausible on its face. See Twombly, 550 U.S. at 558-59. A

14

claim has facial plausibility when the plaintiff pleads factual content that allows the court to

15

draw the reasonable inference that the defendant is liable for the misconduct alleged.”

16

Iqbal, 556 U.S. at 678 (citation omitted). In the event dismissal is warranted, it is generally

17

without prejudice, unless it is clear the complaint cannot be saved by any amendment. See

18

Sparling v. Daou, 411 F.3d 1006, 1013 (9th Cir. 2005).

19

2.

20

Wells Fargo makes a number of arguments in support of its motion. Principally,

Defendant’s Motion

21

Wells Fargo asserts that all causes of action asserted in the complaint are preempted by

22

the Homeowners Loan Act of 1933 (“HOLA”), 12 U.S.C. §§ 1461, et seq., and its

23

implementing regulations, and also argues that each cause of action fails to state a claim.

24

Because the court finds that the first through fifth causes of action are preempted by HOLA,

25

it does not also address Wells Fargo’s argument that those causes of action fail to state a

26

claim.

27

Federal savings associations, including federal savings banks, are subject to HOLA

28

and regulated by the Office of Thrift Supervision (“OTS”). Through HOLA, Congress gave
5

1

OTS broad authority to issue regulations governing thrifts. 12 U.S.C. § 1464; see Silvas v.

2

E*Trade Mortg. Corp., 514 F.3d 1001, 1005 (9th Cir. 2008). In contrast, federally chartered

3

banks are subject to regulation by the Office of Comptroller of the Currency under the

4

National Banking Act (“NBA”).

5

However, before deciding whether HOLA preempts plaintiffs’ claims, the court must

6

resolve whether Wells Fargo, which is not a federally-chartered institution, is entitled to

7

assert HOLA preemption in this case. The original lender as indicated on the Deed of Trust

8

was World Savings Bank, FSB and “its successors and/or assignees.” Paragraph 15 of the

9

Deed of Trust relates to “Governing Law.” It provides that the Trust Deed and the secured
notes “shall be governed by and construed under federal law and federal rules and

11
For the Northern District of California

United States District Court

10

regulations, including those for federally chartered savings institutions . . . .”

12

Numerous district courts have held that successors in interest may properly assert

13

preemption under HOLA even if the successor entity is not a federally chartered savings.

14

See, e.g., Hayes v. Wells Fargo Bank, N.A., 2013 WL 4117050 at *4 (N.D. Cal. Aug. 12,

15

2013); Babb v. Wachovia Mortg., FSB, 2013 WL 3985001 at *4 (C.D. Cal. July 26, 2013);

16

Williams v. Wells Fargo Bank, N.A., 2013 WL 2047000 *3 (C.D. Cal. May 13, 2013);

17

Copeland-Turner v. Wells Fargo Bank, 800 F.Supp.2d 1132, 1144 (D. Or. 2011); Appling v.

18

Wachovia Mortg., FSB, 745 F.Supp.2d 961, 971 (N.D. Cal. 2010); DeLeon v. Wells Fargo

19

Bank, N.A. 729 F.Supp. 2d 1119, 1126 (N.D. Cal. 2010).

20

It is true that a minority of courts have concluded that HOLA should apply only to

21

conduct that occurred prior to the merger of Wachovia into Wells Fargo, a national bank not

22

governed by HOLA. See, e.g., Hopkins v. Wells Fargo Bank, N.A., 2013 WL 2253837 at *3

23

(E.D. Cal. May 22, 2013); Rodriguez v. U.S. Bank Nat. Ass’n, 2012 WL 1996929 at *7

24

(N.D. Cal. June 4, 2012). In this case, however, given that plaintiffs contracted with a

25

Federal Savings Bank, and that the parties agreed to be bound by such laws under the

26

terms of the Deed of Trust, the court finds no bar to applying HOLA preemption.

27
28

The fact that World Savings Bank changed its name to Wachovia Mortgage, FSB,
and subsequently merged into Wells Fargo does not render HOLA inapplicable. In
6

1

addition, this court has previously ruled that where a plaintiff’s loan originated with World

2

Savings, which was a federal savings bank, claims subsequently asserted against Wells

3

Fargo were subject to HOLA. See Vann v. Wells Fargo Bank, 2012 WL 1910032 at *5-6

4

(N.D. Cal. May 24, 2012); see also Parmer v. Wachovia, 2011 WL 1807218 at *1 & n.1

5

(N.D. Cal. Apr. 22, 2011).

6

In promulgating regulations under HOLA, OTS has made clear that it “occupies the

7

entire field of lending regulation for federal savings associations,” leaving no room for

8

conflicting state laws. See 12 C.F.R. § 560.2(a). OTS has provided a non-exhaustive list

9

of types of state laws that are expressly preempted. See 12 C.F.R. § 560.2(b) (expressly
preempting state regulation of federal thrift activities dealing with, among other things,

11
For the Northern District of California

United States District Court

10

terms of credit, loan-related fees, servicing fees, disclosure and advertising, loan

12

processing, loan origination, and servicing of mortgages).

13

Of particular relevance here, state laws are preempted under HOLA if they impose

14

requirements on “[t]he terms of credit, . . . including . . . adjustments to the interest rate,

15

balance, payments due, or term to maturity of the loan, including the circumstances under

16

which a loan may be called due and payable upon the passage of time or under a specified

17

event external to the loan,” or if they impose requirements on “[p]rocessing, origination,

18

servicing, sale or purchase of, or investment or participation in, mortgages . . . .” 12 C.F.R.

19

§ 560.2(b)(4), (10).

20

When evaluating whether a state law is preempted by HOLA, the Ninth Circuit first

21

determines whether, as applied, the state law is the type of law listed in § 560.2(b). If it is,

22

the analysis ends and the law is preempted. See Silvas, 514 F.3d at 1005. If the law in

23

question, as applied, is not listed in § 560.2(b), then the court should determine whether the

24

law “affects lending.” If the answer is yes, a presumption arises pursuant to § 560.2(a) that

25

the law is preempted. Id. Any doubt is resolved in favor of preemption in order to comply

26

with OTS regulations. Id. at 1006.

27
28

The Ninth Circuit’s emphasis is on the “functional effect upon lending operations of
maintaining the cause of action,” rather than on “the nature of the cause of action allegedly
7

1

preempted.” Rumbaua v. Wells Fargo Bank, N.A., 2011 WL 3740828 at *7 (N.D. Cal. Aug.

2

25, 2011) (citation omitted). That is, the pertinent question is whether applying a state law

3

to a federal savings association would “impose requirements” on the lender concerning

4

activities regulated by OTS. Id.; see also Naulty v. GreenPoint Mortg. Funding, Inc., 2009

5

WL 2870620 at *3-4.

6

The court finds that the first through fourth causes of action, which allege various

assert that they were “available to meet with mortgagee, trustee, beneficiary, or authorized

9

agent to explore available options to avoid foreclosure[,]” but that despite this “availability,”

10

defendants “failed to attempt to contact” them in order to comply with the requirements of

11
For the Northern District of California

violations of the HBOR, are preempted by HOLA. In the first cause of action, plaintiffs

8

United States District Court

7

Civil Code § 2923.55(b)(2). See Cplt ¶¶ 26-30. Claims for violation of Civil Code § 2923.5

12

(the predecessor of § 2923.55) are preempted by HOLA because they fall “squarely within

13

the scope of HOLA's Section 560.2(b)(10).” Taguinod v. World Sav. Bank, FSB, 755

14

F.Supp. 2d 1064, 1073 (C.D. Cal. 2010) (citing cases).

15

In the second cause of action, plaintiffs allege that defendants filed the Notice of

16

Default without first making a written determination that plaintiffs were not eligible for a loan

17

modification, or that plaintiffs were offered a loan modification but rejected it, or that

18

plaintiffs accepted a loan modification but defaulted on the new loan, in violation of Civil

19

Code § 2923.6. Cplt ¶¶ 36-40. Courts have found that claims for violations of § 2923.6

20

are preempted by HOLA. See Sato v. Wachovia Mortg., FSB, 2011 WL 2784567 at *7

21

(N.D. Cal. Jul. 13, 2011) (claim that lender violated California Civil Code § 2923.6 by failing

22

to modify her loan preempted by HOLA under provisions for “processing, origination, sale

23

or purchase of . . . mortgages” and “terms of credit”).1

24
25

In the third cause of action, plaintiffs assert that “although they have asked to be
reviewed for alternatives to foreclosure, they have never been assigned a ‘single point of

26
27
28

1

Moreover, the cause of action for violation of Civil Code § 2923.6 fails because that
statute does not provide a private right of action. See Pantoja v. Countrywide Home Loans,
Inc., 640 F.Supp.2d 1177, 1188 (N.D. Cal. 2009).
8

1

contact’ to provide them assistance in applying for potential foreclosure alternatives,” as

2

required by Civil Code § 2923.7. Thus, they allege, they have in effect never been given a

3

meaningful opportunity to apply for, and receive, a loan modification offer. Cplt ¶¶ 43-46.

4

The court finds that this cause of action is preempted by HOLA, as it imposes requirements

5

on “processing” or “servicing” of mortgages, or on the “terms of credit,” and also seeks to

6

impose an obligation that affects lending. It is further preempted to the extent that plaintiffs

7

allege that Wells Fargo was required to offer a loan modification. See, e.g., Gabali v.

8

OneWest Bank, FSB, 2013 WL 1320770 at *10 (N.D. Cal. March 29, 2013).

9

In the fourth cause of action, plaintiffs allege that the declaration attached to the
Notice of Default falsely stated that defendants had complied with the “due diligence”

11
For the Northern District of California

United States District Court

10

requirements of Civil Code § 2923.55 prior to filing the Notice of Default. Plaintiffs assert

12

that this failure to contact them violated Civil Code § 2924.17. Section 2924.17 prohibits

13

the practice of robo-signing, in which servicers sign foreclosure documents without

14

determining the right to foreclose. Plaintiffs do not allege that Wells Fargo engaged in

15

“robo-signing.” Rather, this claim relates back to the first cause of action for violation of

16

§ 2923.55. The court finds that this cause of action is preempted by HOLA, as it imposes

17

requirements on the “processing” and “servicing” of mortgages.2

18

In the fifth cause of action, plaintiffs allege that defendants violated § 17200 by

19

engaging in unfair and fraudulent business acts and practices, with respect to “mortgage

20

servicing” and “foreclosure of the property,” by assessing and attempting to collect

21

improper and excessive late fees; by improperly characterizing plaintiffs’ loan as being in

22

default or being delinquent, in order to generate unwarranted fees; by “providing misleading

23

and incomplete information in order to foreclose” on the property; and by issuing a Notice of

24

Default without first complying with the legal requirements of the HBOR. Cplt ¶¶ 54-68.

25

Plaintiffs also assert that the business acts and practices of Wells Fargo and Cal Western

26
27
28

2

Moreover, § 2924.17 provides for liability for “multiple and repeated uncorrected
violations” of recording and filing requirements listed in § 2924.17(a), but does not provide a
private right of action for a single violation. See Cal. Civ. Code § 2924.17(c).
9

1

were “unfair” because they were “immoral, unethical, oppressive, unscrupulous, and/or

2

substantially injurious to mortgage borrowers.” See Cplt ¶¶ 69-70. The § 17200 cause of

3

action is entirely derivative of the first through fourth causes of action, and thus is

4

preempted by HOLA for the reasons stated above.

5

Finally, in the sixth cause of action, plaintiffs allege that Wells Fargo breached the

6

implied covenant of good faith and fair dealing by breaching various “covenants” of the

7

Deed of Trust, including Covenant No. 3 (“Application of Borrower’s Payments”), Cplt

8

¶¶ 81-83; Covenant No. 15 (“Governing Law; Severability”), Cplt ¶¶ 84-88; Covenant No.

9

28 (“Rights of the Lender if There is a Breach of Duty”), Cplt ¶¶ 89-90; Covenant No. 22

11
For the Northern District of California

United States District Court

10

(“Captions” – which are specified to be “for reference only”), Cplt ¶¶ 91-92.
Plaintiffs claim that Wells Fargo breached Covenant No. 3 by charging excessive

12

and improper late charges, by improperly characterizing plaintiffs’ loan as being in default,

13

and by attempting to collect improper fees and costs. They assert that Wells Fargo

14

breached Covenant No. 15, by failing to follow the “governing law,” which is the law of

15

California. They contend that Wells Fargo breached Covenant No. 28 by failing to comply

16

with California’s non-judicial foreclosure statutes. They assert that Wells Fargo breached

17

Covenant No. 22 by fraudulently recording the Notice of Default.

18

While HOLA preempts state laws that seek to impose requirements on, e.g., loan

19

origination and servicing, loan payment processing, and lending activities, it does not

20

preempt state laws of general applicability, such as tort, contract, and real property laws, to

21

the extent that those laws “only incidentally affect . . . lending operations.” See 12 C.F.R.

22

§ 560.2(c); see Silvas, 514 F.3d at 1006-07. Here, however, the court finds that the sixth

23

cause of action is more amenable to dismissal for failure to state a claim than for HOLA

24

preemption (although portions of the claim are also arguably barred by operation of HOLA).

25

Under California law, “every contract imposes upon each party a duty of good faith

26

and fair dealing in the performance of the contract such that neither party shall do anything

27

which will have the effect of destroying or injuring the right of the other party to receive the

28

fruits of the contract.” Storek & Storek, Inc. v. Citicorp Real Estate, Inc., 100 Cal. App. 4th
10

must allege that (1) the plaintiff and the defendant entered into a contract; (2) the plaintiff

3

did all or substantially all of the things that the contract required him to do or that he was

4

excused from having to do; (3) all conditions required for the defendant's performance had

5

occurred; (4) the defendant unfairly interfered with the plaintiff's right to receive the benefits

6

of the contract; and (5) the defendant's conduct harmed the plaintiff. Woods v. Google,

7

Inc., 889 F.Supp. 2d 1182, 1194 (N.D. Cal. 2012); see also Rosal v. First Fed. Bank of

8

Calif., 671 F.Supp. 2d 1111, 1129 (N.D. Cal. 2009) (to state a claim, plaintiff must allege

9

existence of a specific contractual obligation, along with conduct that frustrates the other

10

party’s rights to benefit from the contract). A court may not imply a covenant of good faith

11
For the Northern District of California

44, 55 (2002). In order to sustain a claim for breach of the implied covenant, a plaintiff

2

United States District Court

1

and fair dealing which contradicts the express terms of a contract. Storek, 100 Cal. App.

12

4th at 55; see also Racine & Laramie, Ltd. v. Department of Parks and Recreation, 11 Cal.

13

App. 4th 1026, 1031-33 (1992).

14

The motion is GRANTED. It appears that plaintiffs may be alleging that Wells Fargo

15

violated the express terms of the Deed of Trust. However, any such breach, if it occurred,

16

would be a breach of contract, and plaintiffs have not alleged a claim of breach of contract

17

– nor do their allegations support a breach of contract claim. In addition, to the extent that

18

plaintiffs are alleging a violation of HBOR as a basis for this claim, the covenant of good

19

faith and fair dealing cannot impose substantive duties or limits on the contracting parties

20

beyond those incorporated in the specific terms of their agreement.

21

Moreover, plaintiffs have not alleged that they themselves performed under the

22

contract. Nor have they alleged any bad faith conduct by Wells Fargo that frustrates their

23

rights to benefit from the contract, or any facts showing how Wells Fargo breached the

24

implied covenant of good faith. Plaintiffs’ only claim here is that Wells Fargo breached

25

various “covenants” of the Deed of Trust. Where a plaintiff’s allegations of breach of the

26

duty of good faith and fair dealing “do not go beyond the statement of a mere contract

27

breach and . . . simply seek the same damages or other relief already claimed in a

28

companion contract cause of action, they may be disregarded as superfluous as no
11

1

additional claim is actually stated.” Careau & Co. v. Sec. Pac. Bus. Credit, Inc., 222 Cal.

2

App. 3d 1371, 1395 (1990).

3

Plaintiffs cannot plead a tort claim for breach of contract (breach of implied

4

covenant) that alleges nothing more than what a claim of breach of express contract would

5

allege. Moreover, plaintiffs cannot state a claim for breach of the Deed of Trust, given their

6

failure to perform by making the loan payments.

7

CONCLUSION

8

In accordance with the foregoing, Wells Fargo’s motion to dismiss the complaint is

9

GRANTED. Given plaintiffs’ failure to file a timely opposition, and their failure to provide,
either in writing or at the hearing, any basis for amending the complaint, the court

11
For the Northern District of California

United States District Court

10

dismisses the claims asserted against Wells Fargo with prejudice.

12
13

The remaining defendant, Cal Western, did not join in the motion and does not
appear to have been served, as it has made no appearance.

14
15

IT IS SO ORDERED.

16

Dated: September 13, 2013
______________________________
PHYLLIS J. HAMILTON
United States District Judge

17
18
19
20
21
22
23
24
25
26
27
28
12