Lesavoy et al v. JPMorgan Chase Bank, N.A.
Filing
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ORDER by Judge Hamilton granting 28 Motion to Dismiss (pjhlc2, COURT STAFF) (Filed on 11/12/2014)
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UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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LESTER LESAVOY, et al.,
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Plaintiffs,
No. C 14-2226 PJH
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v.
ORDER GRANTING MOTION TO
DISMISS
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JP MORGAN CHASE BANK, N.A.,
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Defendant.
___________________________________/
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Defendant JP Morgan Chase Bank’s motion to dismiss came on for hearing before
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this court on November 5, 2014. Plaintiffs Lester Lesavoy and Linda Lesavoy (“plaintiffs”)
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appeared through their counsel, Tiffany R. Norman. Defendant JP Morgan Chase Bank,
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N.A. (“Chase” or “defendant”) appeared through its counsel, Jessica Luhrs. Having
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carefully reviewed the parties’ papers and considered their arguments and the relevant
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legal authority, and good cause appearing, the court hereby GRANTS defendant's motion
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to dismiss for the reasons stated at the hearing and as follows.
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In the operative first amended complaint (“FAC”), plaintiffs allege that they
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purchased their home in January 2006, became unable to pay their mortgage sometime in
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2008, and requested a loan modification from defendant in November 2008. See FAC, ¶¶
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16-18. Plaintiffs further allege that they “updated their loan modification application
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documents on approximately a monthly basis” between 2008 and 2010. Id., ¶ 21. Plaintiffs
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allege that their loan modification requests were denied due to “missing documents,” but
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also allege that defendant “failed to respond within thirty days after each application was
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filed.” Id., ¶¶ 71, 73.
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Plaintiffs’ complaint also cites to a declaration from a former Chase employee
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(Melody Simpson) alleging that plaintiffs submitted loan modification applications “3-4 times
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a year since sometime in 2009,” and that even though the applications were always
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complete, they were repeatedly denied because of “missing documents.” FAC, ¶ 28.
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Plaintiffs also allege other “mishandling” of their loan modification applications, based on
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the Simpson declaration. See, e.g., FAC, ¶¶ 33-35.
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Based on the alleged mishandling of their loan modification applications, plaintiffs
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filed suit in Contra Costa County Superior Court on April 7, 2014. Defendant then removed
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the case to this court and moved to dismiss the complaint, and on June 11, 2014, plaintiffs
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filed the operative FAC. The FAC alleges five causes of action against Chase: (1)
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negligence, (2) violation of Cal. Civ. Code §§ 1701 and 1710, (3) violation of 15 U.S.C. §
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1691 (d)(1), (4) violation of Cal. Bus. & Prof. Code § 17200, and (5) injunctive relief
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preventing a trustee foreclosure sale.
As stated at the hearing, plaintiffs’ complaint does not adequately explain the facts
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surrounding their loan modification applications and does not adequately explain which
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facts underlie each asserted cause of action. It is unclear when the plaintiffs applied for
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loan modifications, when they received responses from defendant, and whether the
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responses were timely. The complaint’s lack of clarity prevents the court from being able to
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determine which of their causes of action are viable. For instance, plaintiffs assert a claim
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under the Equal Opportunity Credit Act (“ECOA”), which requires creditors to provide a
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decision on loan modification applications within thirty days. However, plaintiffs do not
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explain which of their applications resulted in no response from Chase (which may give rise
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to a ECOA claim), and which of their applications resulted in a wrongful denial by Chase
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(which may give rise to a different claim). In short, plaintiffs have not alleged sufficient facts
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in their complaint to determine whether plaintiffs have valid causes of action.
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Based on the confusion surrounding the underlying facts, the court has determined
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that plaintiffs need to state more facts to support their claims. Accordingly, as stated at the
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hearing, the FAC is DISMISSED with leave to amend as to the first, second, third, and
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fourth causes of action. Any amended complaint must specifically allege the facts
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underlying plaintiffs’ claims, and must explain which transactions give rise to each asserted
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cause of action. In particular, plaintiffs must specifically set forth (1) the number of loan
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modification applications submitted to defendant, (2) the dates on which the loan
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modification applications were submitted, (3) whether plaintiffs received a response to each
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application, and if so, what the response was, and (4) which loan modification applications
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allegedly defendant mishandled and how it mishandled them. Factual information should
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be stated in the complaint rather than in a separate declaration.
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To the extent that plaintiffs assert any claim for fraud (either a fraudulent
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concealment or a fraudulent misrepresentation), plaintiffs must allege such claims with
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particularity, as required by Rule 9(b). To the extent that plaintiffs assert a claim under Cal.
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Bus. & Prof. Code § 17200, plaintiffs must identify the specific prong of the statute upon
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which their claim is based.
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As stated at the hearing, plaintiffs’ fifth cause of action seeking an injunction of the
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trustee foreclosure sale claim is dismissed without leave to amend, because this claim is
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premature since a foreclosure sale date has not yet been scheduled.
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Plaintiffs will have until December 3, 2014 to file a second amended complaint
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(“SAC”) in accordance with this order. Defendant shall have 21 days thereafter to answer
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or otherwise respond to the complaint. No new parties may be added without leave of
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court, and no new claims may be added without leave of court or the agreement of the
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parties.
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IT IS SO ORDERED.
Dated: November 12, 2014
______________________________
PHYLLIS J. HAMILTON
United States District Judge
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