Brooks v. Litton Loan Services

Filing 15

ORDER by Judge Hamilton granting in part 10 motion to dismiss; remanding case (pjhlc2, COURT STAFF) (Filed on 9/9/2014) (Additional attachment(s) added on 9/9/2014: # 1 Certificate/Proof of Service) (nahS, COURT STAFF).

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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DEIDRA BROOKS,
Plaintiff,

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v.
LITTON LOAN SERVICING LP,

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For the Northern District of California

United States District Court

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No. C 14-2266 PJH
ORDER GRANTING IN PART
MOTION TO DISMISS, REMANDING
CASE

Defendant.
_______________________________/

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Defendant’s motion to dismiss came on for hearing before this court on August 27,

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2014. Plaintiff Deidra Brooks (“plaintiff”) appeared in pro per. Defendant Litton Loan

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Servicing LP (“defendant”) appeared through its counsel, Steve Pornbida. Having read the

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papers filed in conjunction with the motion and carefully considered the arguments and the

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relevant legal authority, and good cause appearing, the court hereby GRANTS in part

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defendant’s motion to dismiss and REMANDS the case to the Superior Court for the

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County of Contra Costa.

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This is a mortgage case. Plaintiff originally filed suit in state court on September 18,

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2012, and then filed the operative first amended complaint (“FAC”), also in state court, on

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April 17, 2014. The FAC asserts twelve causes of action: (1) violation of section Cal. Bus.

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& Prof. Code section 17200 (predicated on Cal. Civ. Code § 2923.5), (2) breach of

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covenant of good faith and fair dealing, (3) slander of title, (4) alter ego liability, (5) breach

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of contract, (6) unjust enrichment, (7) violation of section 17200 (predicated on Cal. Civ.

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Code §§ 2923.5, 2923.6, 1788.17, and 1572), (8) violation of section 17200 (predicated on

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the Truth in Lending Act (“TILA”)), (9) violation of Cal. Civ. Code § 2923.5, (10) defamation,

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(11) false light, and (12) intentional misrepresentation.

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On May 15, 2014, defendant removed the case to this court based on federal

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question jurisdiction, stating in the notice of removal that the “First Amended Complaint

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alleges liability brought under and based upon federal law.” Dkt. 1 at 2. Specifically, the

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notice of removal stated that the “eighth cause of action is for alleged violations of the

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Federal Truth-in-Lending Act” and “violations of the Home Owners Loan Act of 1933.” Id.

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Defendant also noted that the FAC “alleges violations of Business and Professions

applicable federal statutes,” and that the FAC “lists a cause of action for alleged violations

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of the Home Ownership Equity Protection Act (“HOEPA”) . . . in her caption, but it does not

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appear elsewhere in the First Amended Complaint.” Id. at 2-3. Finally, defendant argued

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For the Northern District of California

Code § 17200's prohibition on unlawful acts which can create state liability for breach of

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United States District Court

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in the notice of removal that the court should exercise supplemental jurisdiction over

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plaintiff’s state law claims.

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Defendant then filed a motion to dismiss on July 14, 2014, arguing that all of the

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FAC’s claims should be dismissed without leave to amend. Plaintiff did not file an

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opposition to the motion. However, on August 26, 2014, the court received a paper copy of

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a document entitled “plaintiff’s unilateral case management conference statement.”

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Plaintiff’s statement is dated August 18, 2014, but it was not filed with the clerk’s office, and

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it does not appear on the case’s docket. In the document, plaintiff claims to have “filed and

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served upon defendant an opposition to defendants’ demurrer and motion to dismiss

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plaintiff’s complaint with a proposed order to deny each and every request submitted by

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defendant.” However, the court did not receive any such opposition, so at the August 27

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hearing, the court asked plaintiff about the status of her opposition brief. Plaintiff informed

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the court that she had retained some type of document preparation service, and that a

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representative of the service had informed her that the opposition brief had been served

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upon defendant and filed with the court. Defendant denied having received any opposition,

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and the court noted that no opposition had been filed with the clerk’s office. The court then

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told plaintiff that she would be given until the next day (August 28) to file the already-drafted

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opposition with the court, and that if it were filed, defendant would have until September 3,
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2014 to file a reply. Plaintiff did not file her opposition on August 28 (and in fact, still has

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not filed it to date), so the court will decide defendant’s motion to dismiss based on the

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arguments presented in its motion and at the August 27 hearing.

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At the hearing, the court focused on the federal claim(s) that formed the basis for

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removal. The court first addressed plaintiff’s eighth cause of action, which is brought under

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California Business & Professions Code section 17200, but which is based on an

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underlying alleged TILA violation. Defendant argues that this claim relates to the

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origination of plaintiff’s loan, which occurred in 2005. The statute of limitations under TILA

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is one year, and the statute of limitations under section 17200 is four years. Thus,
regardless of which limitations period is applied, the court finds that plaintiff’s eighth cause

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For the Northern District of California

United States District Court

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of action is time-barred. Accordingly, plaintiff’s eighth cause of action is DISMISSED

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without leave to amend.

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The court then discussed plaintiff’s tenth cause of action for defamation, which is

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brought under state law, but which alleges that defendant made false statements to a credit

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agency. In its motion, defendant correctly noted that the federal Fair Credit Reporting Act

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(“FCRA”) preempts state law claims based on credit reporting disputes. At the hearing, the

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court asked plaintiff about the specific conduct that gave rise to this claim, and she

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admitted that she did take out a loan, and that she did default on that loan, and thus, any

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default that was reported to credit agencies was not in fact false. Accordingly, plaintiff’s

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tenth cause of action is DISMISSED without leave to amend.

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The court then noted that no other federal claims were asserted in the FAC, though

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there were passing references to two other federal statutes. First, the second cause of

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action (for breach of the covenant of good faith and fair dealing) made reference to a case

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filed against defendant in the Central District of California (Schaffer v. Litton Loan

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Servicing), which involved allegations that defendant had violated the federal Real Estate

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Settlement Procedures Act (“RESPA”). However, at the hearing, plaintiff clarified that she

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did not intend to assert a RESPA claim in this case, and merely mentioned the Schaffer

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case “as an example” of defendant’s “unfair practices.” Thus, the court finds that the
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second cause of action does not involve any claim under federal law.
Second, the court noted that the FAC’s caption included a reference to the federal

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“Home Ownership Equity Protection Act,” or “HOEPA.” However, no HOEPA claim is

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asserted in the body of the complaint. When asked about this reference to HOEPA,

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plaintiff stated that she did not know what HOEPA was or why it was included in the

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complaint. Plaintiff indicated that the document preparation service that she had retained

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had likely inserted the reference to HOEPA. Accordingly, the court finds that the FAC does

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not assert any claim under HOEPA.

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Having dismissed, with prejudice, the only asserted claim(s) arising under federal
law (the eighth cause of action, and possibly the tenth cause of action), and having

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For the Northern District of California

United States District Court

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determined that no other federal question is implicated by the complaint, the court hereby

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declines to exercise supplemental jurisdiction over plaintiff’s state law claims, and

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REMANDS the case to the Superior Court for the County of Contra Costa.

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IT IS SO ORDERED.
Dated: September 9, 2014

____________________________
PHYLLIS J. HAMILTON
United States District Judge

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