Cook et al v. Wells Fargo Bank et al

Filing 27

ORDER: Plaintiffs' (Doc. 21 ) Motion for Leave to File Third Amended Complaint is granted. Plaintiffs shall file the proposed Third Amended Complaint attached to Plaintiffs' Motion as Exhibit A by no later than ten days from the date of this Order. Signed by Judge William Q. Hayes on 3/25/2011. (mdc)

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(ECF No. II). On July 7, 2010, this Court granted the motion to dismiss finding that Plaintiffs' Truth in Lending Act claim was not time barred, but the allegation that Plaintiffs

3 had sufficient funds "at their disposal" to tender was insufficient to state a claim. (ECF No. 4 5 15 at 6). Plaintiffs were permitted to file a motion for leave to amend the complaint. On August 6, 20 I 0, Plaintiffs filed a Motion for Leave to File a Second Amended

6 Complaint ("SAC"). (ECF No. 16). In the proposed SAC, Plaintiffs alleged that Plaintiff 7 Chris Cook was willing to sell his interest in his business and liquidate his retained 8 earnings to tender, and that amount was "approximately $1,000,000.00." (ECF No. 16-1 at 9 13). Defendant contended that Plaintiffs' proposed SAC was futile because Plaintiffs'

10 tender offer fell "approximately $329,000 short of full and complete tender." (ECF No. 17 II 12 13 at 3). In Plaintiffs' Reply, Plaintiffs argued that the value of the business sale and liquidation of retained earnings totaled $1,351,619.74. On November 17,2010, this Court denied Plaintiffs' Motion for Leave to File a

14 Second Amended Complaint finding that, "Plaintiffs no longer seek to file the proposed 15 16 Second Amended Complaint which is the subject of this Motion." (ECF No. 20 at 3). On December 21, 20 I 0, Plaintiffs' Motion for Leave to File Third Anlended

17 Complaint ("T AC") was filed. (ECF No. 21). In the proposed TAC, Plaintiffs alleges that 18 "Plaintiffs are willing, able and prepared to tender a principal amount after the appropriate

19 credits are made for interest, finance charges and any other fees or payments applicable 20 under the statute." Id. at 16. Plaintiffs allege that, "[i]f California Correctional Foods Inc. 21 22 23 were sold on the open market, Plaintiffs' interest in the purchase price would be approximately $995, 923.90." Id. Plaintiffs allege that Plaintiffs would also be "paid their equity and retained earnings, which are valued at approximately $355,695.84 ...." Id. "The

24 combined total equals $1,351,619.74." Id. Plaintiffs allege that the sum is "sufficient to
25 rescind the loan at the center of this dispute after all appropriate credits have been taken

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into consideration." Id. On January 4,2011, Defendant Wells Fargo filed an Opposition to Plaintiffs' Motion for Leave to File Third Amended Conlplaint. (ECF No.24). Defendant contends
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After consideration of the submissions of the parties, the Court concludes that Defendant has not made a sufficiently strong showing of the F oman factors to overcome the presumption under Rule 15(a) in favor of granting leave to amend. See Eminence
Capital, 316 F.3d at 1052. The Court will defer consideration of any challenge to the

5 merits of the proposed third amended complaint until after leave to amend is granted and 6 the amended pleading is filed. See Hynix Semiconductor Inc. v. Toshiba Corp., No. C-04

7 4708,2006 WL 3093812, at *2 (N.D. Cal., Oct. 31,2006) ("In view of Rule 15(a)'s 8 permissive standard, courts ordinarily defer consideration of challenges to the merits of a 9 proposed amended pleading until after leave to amend is granted and the amended pleading

lOis filed."). 11 12 13 14 15 16 17 18 DATED: 19 20 21 22 23 24
CONCLUSION

IT IS HEREBY ORDERED that Plaintiffs' Motion for Leave to File Third Anlended Complaint (ECF No. 21) is GRANTED. Plaintiffs shall file the proposed Third Amended Complaint attached to Plaintiffs' Motion as Exhibit A by no later than ten days from the date of this Order.

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WILLIAM Q. HAYES UNITED STATES DISTRICT JUDGE

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09cv2757 WQH (NLS)