Mayen v. New Penn Financial, LLC

Filing 11

ORDER: (1) Granting Defendant's Motion to Dismiss; and (2) Granting in Part and Denying in Part Defendant's Request for Judicial Notice re 6 Motion to Dismiss. The Court Grant's in Part and Denies in Part Defendant's RJN (ECF N o. 6-1) and Grants Defendant's MTD on all causes of action, (ECF No. 6). Accordingly, the Court Dismisses without prejudice Plaintiff's Complaint and Grants Plaintiff leave to file an amended Complaint, if any, on or before fourteen days from the date on which this Order is electronically docketed. Signed by Judge Janis L. Sammartino on 8/16/2017. (All non-registered users served via U.S. Mail Service)(mpl)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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JULIO MAYEN,

Case No.: 17-CV-50 JLS (MDD)
Plaintiff,

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ORDER: (1) GRANTING
DEFENDANT’S MOTION TO
DISMISS; AND
(2) GRANTING IN PART AND
DENYING IN PART DEFENDANT’S
REQUEST FOR JUDICIAL NOTICE

v.
NEW PENN FINANCIAL, LLC dba
SHELLPOINT MORTGAGE
SERVICING,

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Defendants.

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(ECF Nos. 6, 6-2)

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Presently before the Court is Defendant New Penn Financial, LLC’s Motion to

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Dismiss Plaintiff’s Complaint or for a More Definite Statement, (“MTD,” ECF No. 6-1).

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Also before the Court are Plaintiff Julio Mayen’s Response in Opposition and Objection

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to, (“Opp’n,” ECF No. 7), and Defendant’s Reply in Support of, (“Reply,” ECF No. 8),

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Defendant’s MTD, as well as Defendants’ Request for Judicial Notice in Support of Motion

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to Dismiss, (“RJN,” ECF No. 9-2). The Court vacated the hearing on the motion and took

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the matter under submission pursuant to Civil Local Rule 7.1(d)(1). (ECF No. 9.) After

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considering the parties’ arguments and the law, the Court GRANTS IN PART and

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DENIES IN PART Defendant’s RJN and GRANTS Defendant’s MTD.
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17-CV-50 JLS (MDD)

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BACKGROUND

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On December 27, 2004, Plaintiff Julio Mayen purchased the residential property

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located at 15335 Castle Peak Lane, Jamul, CA 91935 (the “Property”) with a $1,088,000

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loan, secured by a deed of trust on the Property, from Countrywide Home Loans, Inc.

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(Compl. ¶ 18, ECF No. 1.) Plaintiff “allegedly defaulted on the loan” on March 1, 2009.

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(Id. ¶ 19.) On December 24, 2013, Plaintiff alleges that Resurgent Capital Services L.P.

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(“Resurgent”) “sent Plaintiff a letter stating they have acquired the servicing rights of

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Plaintiffs [sic] defaulted loan.” (Id. ¶ 20.) In response, Plaintiff claims he “sent Resurgent

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a debt validation letter disputing the amount and validity of the debt” on January 31, 2014.

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(Id. ¶ 21.) Shortly thereafter, Plaintiff alleges he received “a notice from Resurgent and

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Shellpoint transferring servicing rights to Shellpoint” on February 14, 2014, (id. ¶ 22), and

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in response, Plaintiff claims he “sent Shellpoint a debt validation letter disputing the

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amount and validity of the debt” on March 31, 2014, (id. ¶ 23).

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Plaintiff further alleges that in response to Plaintiff’s letters disputing his debt,

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“Shellpoint has provided documents as if Plaintiff has requested a Qualified Written

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Request (QWR) instead of account-level documents substantiating the amount and validity

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of the debt,” and that “[t]o this date, Defendant has never validated or verified the alleged

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debt.” (Id. ¶ 24.) In addition, Plaintiff alleges that “Defendant, for the past 12 months, has

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sent Plaintiff six demands for payment without providing any account-level documentation

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substantiating the amount of the debt.” (Id. ¶ 25.) Finally, Plaintiff alleges that

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“Defendant’s correspondence regarding debt amounts due are very inconsistent and

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confusing.” (Id. ¶ 26.)

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Plaintiff filed a complaint against Defendant on January 11, 2017, alleging causes

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of action under the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq.

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(“FDCPA”) and the Rosenthal Fair Debt Collection Practices Act, California Civil Code

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section 1788, et seq. (“RFDCPA”). (See generally Compl.) Plaintiff brings three claims

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against Defendant based on these allegations: (1) Defendant’s continued collection activity

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of a disputed debt violates FDCPA Section 1692g(b); (2) Defendant’s false representation
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of the character and amount of Plaintiff’s debt violates FDCPA Section 1692e(2)A; and

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(3) Defendant’s violations of the FDCPA constitute violations of the RFDCPA. (See

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generally id.) Plaintiff seeks statutory and actual damages, attorney’s fees, costs, and

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injunctive relief. (Id. ¶¶ 29, 31.) On March 17, 2017, Defendant moved to dismiss

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Plaintiff’s Complaint or for a more definite statement. (ECF No. 6.)

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LEGAL STANDARD

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Federal Rule of Civil Procedure 12(b)(6) permits a party to raise by motion the

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defense that the complaint “fail[s] to state a claim upon which relief can be granted,”

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generally referred to as a motion to dismiss. The Court evaluates whether a complaint states

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a cognizable legal theory and sufficient facts in light of Federal Rule of Civil Procedure

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8(a), which requires a “short and plain statement of the claim showing that the pleader is

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entitled to relief.” Although Rule 8 “does not require ‘detailed factual allegations,’ . . . it

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[does]

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accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v.

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Twombly, 550 U.S. 544, 555 (2007)). In other words, “a plaintiff’s obligation to provide

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the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels and conclusions, and

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a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S.

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at 555 (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). A complaint will not suffice

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“if it tenders ‘naked assertion[s]’ devoid of ‘further factual enhancement.’” Iqbal, 556 U.S.

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at 677 (citing Twombly, 550 U.S. at 557).

demand

more

than

an

unadorned,

the-defendant-unlawfully-harmed-me

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In order to survive a motion to dismiss, “a complaint must contain sufficient factual

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matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Id. (quoting

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Twombly, 550 U.S. at 570); see also Fed. R. Civ. P. 12(b)(6). A claim is facially plausible

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when the facts pled “allow the court to draw the reasonable inference that the defendant is

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liable for the misconduct alleged.” Iqbal, 556 U.S. at 677 (citing Twombly, 550 U.S. at

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556). That is not to say that the claim must be probable, but there must be “more than a

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sheer possibility that a defendant has acted unlawfully.” Id. Facts “‘merely consistent with’

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a defendant’s liability” fall short of a plausible entitlement to relief. Id. (quoting Twombly,
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550 U.S. at 557). Further, the Court need not accept as true “legal conclusions” contained

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in the complaint. Id. This review requires context-specific analysis involving the Court’s

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“judicial experience and common sense.” Id. at 678 (citation omitted). “[W]here the well-

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pleaded facts do not permit the court to infer more than the mere possibility of misconduct,

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the complaint has alleged—but it has not ‘show[n]’—‘that the pleader is entitled to relief.’”

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Id.

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Because this case comes before the Court on a motion to dismiss, the Court must

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accept as true all material allegations in the complaint, and must construe the complaint

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and all reasonable inferences drawn therefrom in the light most favorable to Plaintiff. See

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Thompson v. Davis, 295 F.3d 890, 895 (9th Cir. 2002). When a plaintiff appears pro se, the

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court must be careful to construe the pleadings liberally and to afford the plaintiff any

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benefit of the doubt. See Erickson v. Pardus, 551 U.S. 89, 94 (2007); Thompson, 295 F.3d

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at 895. Where a complaint does not survive 12(b)(6) analysis, the Court will grant leave to

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amend unless it determines that no modified contention “consistent with the challenged

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pleading . . . [will] cure the deficiency.” DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655,

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658 (9th Cir. 1992) (quoting Schriber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d

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1393, 1401 (9th Cir. 1986)). Furthermore, “before dismissing a pro se complaint the district

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court must provide the litigant with notice of the deficiencies in his complaint in order to

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ensure that the litigant uses the opportunity to amend effectively.” Ferdick v. Bonzelet, 963

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F.2d 1258, 1261 (9th Cir. 1992).

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ANALYSIS
I.

Request for Judicial Notice

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Defendant’s Motion to Dismiss is accompanied by a Request for Judicial Notice.

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(See generally RJN.) Although within the context of a motion to dismiss under Federal

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Rule of Civil Procedure 12(b)(6), a Court generally may not consider matters outside of

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the pleadings, see Fed. R. Civ. P. 12(d), it is nonetheless “appropriate for the Court to take

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notice of ‘relevant facts obtained from the public record . . . .’ ” See Papasan, 478 U.S. at

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298; see also Harris v. Cty. of Orange, 682 F.3d 1126, 1132–33 (9th Cir. 2012) (noting
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that a court may “take judicial notice of undisputed matters of public record” and that

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“documents not attached to a complaint may be considered if no party questions their

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authenticity and the complaint relies on those documents” (citing Lee v. City of L.A., 250

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F.3d 668, 688, 689 (9th Cir. 2001))).

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Defendant moves the Court to take judicial notice of fourteen exhibits in support of

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its motion: (1) the Deed of Trust recorded on December 30, 2004 in the Official Records

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of the County Recorder’s Office of San Diego County, California; (2) the Assignment of

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Deed of Trust recorded on June 13, 2011 in the Official Records of the County Recorder’s

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Office of San Diego County, California; (3) the Notice of Default and Election to Sell under

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Deed of Trust recorded on February 29, 2016 in the Official Records of the County

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Recorder’s Office of San Diego County, California; (4) the Notice of Trustee’s Sale

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recorded on June 27, 2016 in the Official Records of the County Recorder’s Office of San

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Diego County, California; (5) the Electronic Docket from Case No. 13-01660-LT13,

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United States Bankruptcy Court for the Southern District of California; (6) the Voluntary

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Petition for Individuals Filings for Bankruptcy filed by Plaintiff on February 21, 2013 in

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Case No. 13-01660-LT13, United States Bankruptcy Court for the Southern District of

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California; (7) the Balance of Schedules, Statements, and/or Chapter 13 Plan filed by

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Plaintiff on March 22, 2013 in Case No. 13-01660-LT13, United States Bankruptcy Court

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for the Southern District of California; (8) the Electronic Docket from Case No. 16-05104-

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LT13, United States Bankruptcy Court for the Southern District of California; (9) the

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Voluntary Petition for Individuals Filings for Bankruptcy filed by Plaintiff on August 22,

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2016 in Case No. 16-05104-LT13, United States Bankruptcy Court for the Southern

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District of California; (10) the Balance of Schedules, Statements, and/or Chapter 13 Plan

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filed by Plaintiff on September 20, 2016 in Case No. 16-05104-LT13, United States

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Bankruptcy Court for the Southern District of California; (11) the Electronic Docket from

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Case No. 16-07181-LT13, United States Bankruptcy Court for the Southern District of

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California; (12) the Voluntary Petition for Individuals Filings for Bankruptcy filed by

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Plaintiff on November 28, 2016 in Case No. 16-07181-LT13, United States Bankruptcy
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Court for the Southern District of California; (13) the Balance of Schedules, Statements,

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and/or Chapter 13 Plan filed by Plaintiff on January 4, 2017 in Case No. 16-07181-LT13,

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United States Bankruptcy Court for the Southern District of California; and (14) the Notice

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of Entry of Order Dismissing Case and Vacating All Automatic Stays and Injunctions

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issued on March 9, 2017 in Case No. 16-07181-LT13, United States Bankruptcy Court for

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the Southern District of California. (See generally RJN.)

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Plaintiff opposes all documents filed by Defendant for “trying to make this case

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about [Plaintiff’s] alleged debt.” (Opp’n 6.1) Plaintiff further argues that the exhibits filed

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by Defendant “are irrelevant in this case for the simple reason that this case is about the

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conduct of Shellpoint as they attempted to collect an alleged debt” and that “[t]his is a very

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straight forward claim for violations of the FDCPA and the Rosenthal Act resulting from

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Shellpoint’s conduct and has nothing to do with any alleged debt.” (Id. (emphasis in

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original).) However, Plaintiff does not question the authenticity of Defendant’s Exhibits 1

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and 32 and the documents are objectively verifiable. See Fed. R. Evid. 201(b). Given the

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foregoing, and because Defendant’s argument that Plaintiff’s failure to allege facts

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supporting claims under the FDCPA and RFDCPA has the potential to dispose of all of

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Plaintiff’s causes of action, the Court find Exhibits 1 and 3 are validly judicially noticed.
Accordingly, the Court GRANTS IN PART and DENIES IN PART Defendant’s

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RJN.

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II.

Motion to Dismiss

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Defendant moves to dismiss Plaintiff’s FDCPA and RFDCPA claims on multiple

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grounds: (1) judicial estoppel from Plaintiff’s three prior bankruptcies bars Plaintiff from

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bringing this entire action; (2) Plaintiff fails to allege facts supporting claims under the

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FDCPA or RFDCPA; and (3) Plaintiff fails to include a necessary and indispensable

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Pin citations to docketed material refer to the CM/ECF numbers electronically stamped at the top of each
page.
Because the Court does not need to consider Exhibits 2 or 4–14 to rule on Defendant’s MTD, infra
Sections II.A–B, the Court does not grant judicial notice to Exhibits 2 or 4–14.
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party—co-borrower, Sarah A. Mayen. (See generally Defendant’s Memorandum of Points

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and Authorities to Its Motion to Dismiss or for a More Definite Statement (“MTD”), ECF

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No. 6-1.) Alternatively, Defendant requests that Plaintiff provide a more definite statement.

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(Id.) However, before the Court can determine whether judicial estoppel bars this entire

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action, the Court must first determine whether Plaintiff’s allegations support a cause of

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action under the FDCPA or RFDCPA. If Plaintiff is unable to allege sufficient facts

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supporting the plausibility of his claims that Defendant violated the FDCPA or RFDCPA,

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then Plaintiff never had a claim to disclose during Plaintiff’s bankruptcy proceedings.

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A. Whether Plaintiff Failed to State a Claim for Violation of the FDCPA

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Defendant argues that it does not qualify as a debt collector under the FDCPA

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because Plaintiff “has not alleged Shellpoint began servicing his loan after he had already

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defaulted” and “[a]s the complaint currently stands, it is altogether unclear what the status

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of the loan was at the time of service transfer to Shellpoint.” (MTD 4–5.) Defendant further

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argues that Plaintiff’s claim “fails because his loan obligation serviced by Shellpoint is not

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a ‘consumer debt’ for FDCPA purposes” and even if Plaintiff’s mortgage loan did qualify

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as a consumer debt under the FDCPA, “the complaint does not contain a single specific

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fact connecting Shellpoint’s conduct to any FDCPA prohibition.” (Id. at 5.) In response,

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Plaintiff argues that Defendant qualifies as a debt collector under the FDCPA because “the

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alleged default date of the alleged loan was March 1, 2009 which was at least four and a

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half years prior to” Plaintiff receiving the February 14, 2014 “notice from

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Resurgent/Shellpoint transferring servicing rights to Shellpoint.” (Opp’n 12.) And

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therefore, Plaintiff argues, Defendant’s failure to respond to Plaintiff’s March 31, 2014

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“debt [v]alidation letter disputing the amount and validity of the debt” and Defendant’s

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“six different demands for payment without providing any account-level documentation

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substantiating the amount of the alleged debt” constitute “continued collection activity of

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a disputed debt making this lawsuit ripe and proper for this claim.” (Id. at 13.)

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Congress enacted the FDCPA “to eliminate abusive debt collection practices by debt

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collectors, to insure that those debt collectors who refrain from using abusive debt
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collection practices are not competitively disadvantaged, and to promote consistent State

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action to protect consumers against debt collection abuses.” 15 U.S.C. § 1692(e). The

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FDCPA “regulates the conduct of debt collectors, imposing affirmative obligations and

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broadly prohibiting abusive practices.” Gonzales v. Arrow Financial Servs., LLC, 660 F.3d

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1055, 1060–61 (9th Cir. 2011). To state a claim under the FDCPA, a plaintiff must show:

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(1) that he is a consumer; (2) that the debt arises out of a transaction entered into for

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personal, family, or household purposes; (3) that the defendant qualifies as a debt collector

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under 15 U.S.C. § 1692a(6); and (4) that the defendant violated one of the provisions of

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the FDCPA. Freeman v. ABC Legal Servs., Inc., 827 F. Supp. 2d 1065, 1071 (N.D. Cal.

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2011). Because Plaintiff’s debt originates from his obligation to pay for property he

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purchased for personal use, only the third and fourth prongs are at issue here.

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(1)

Whether Defendant Qualifies as a Debt Collector

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Under the FDCPA, “[t]he term ‘debt collector’ means any person who . . . [is] in any

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business the principal purpose of which is the collection of any debts, or who regularly

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collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be

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owed or due another.” 15 U.S.C. § 1692a(6). Section 1692a(6)(F)(iii) of the FDCPA

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exempts—among other entities—“a mortgage servicing company, or any assignee of the

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debt, so long as the debt was not in default at the time it was assigned.” Nool v. HomeQ

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Servicing, 653 F. Supp. 2d 1047, 1053 (E.D. Cal. 2009) (quoting Perry v. Stewart Title

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Co., 756 F.2d 1197, 1208 (5th Cir. 1985)); see also De Dios v. Int’l Realty & Invs., 641

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F.3d 1071, 1075 n.3 (9th Cir. 2011) (“[D]ebt collector does not include those ‘mortgage

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service companies and others who service outstanding debts for others, so long as the debts

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were not in default when taken for servicing . . . .’ ”) (summarizing and quoting S. Rep.

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No. 95–382, at 3–4 (1977), reprinted in 1977 U.S.C.C.C.A.N. 1695, 1698); id.

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(“[E]xemption in § 1692a(6)(F)(iii) was intended to apply to mortgage companies and

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other parties ‘whose business is servicing current accounts . . . .’ ”) (summarizing and

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quoting Fed. Trade Comm’n, Staff Commentary on the Fair Debt Collection Practices Act

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§ 803, 53 Fed. Reg. 50,097, 50,103 (Dec. 13, 1988) (emphasis in original)). Therefore, to
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determine the threshold issue of whether Defendant, a mortgage servicing company,

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qualifies as a debt collector, the Court must first address whether Plaintiff’s debt was in

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default at the time it was assigned to Defendant.

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Because the FDCPA does not define “in default,” “courts interpreting Section

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1692a(6)(F)(iii) look to any underlying contracts and applicable law governing the debt at

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issue.” De Dios, 641 F.3d at 1074; cf. id. at 1075 n.3 (noting further that the FDCPA’s

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“legislative history is consistent with construing ‘in default’ to mean a debt that is at least

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delinquent, and sometimes more than overdue.”). Here, the recorded Deed of Trust to

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Plaintiff’s property that Defendant filed as Exhibit 1 states the following:

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Borrower shall be in default if any action or proceeding, whether civil or
criminal, is begun that, in Lender’s judgment, could result in forfeiture of the
Property or other material impairment of Lender’s interest in the Property or
rights under this Security Instrument. Borrower can cure such a default and,
if acceleration has occurred, reinstate as provided in Section 19, by causing
the action or proceeding to be dismissed with a ruling that, in Lender’s
judgment, precludes forfeiture of the Property or other material impairment of
Lender’s interest in the Property or rights under this Security Instrument. The
proceeds of any award or claim for damages that are attributable to the
impairment of Lender’s interest in the Property are hereby assigned and shall
be paid to Lender.

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(MTD Ex. 1, ECF No. 6-3, at 11.) However, the recorded Notice of Default and Election

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to Sell Under Deed of Trust filed by Defendant as Exhibit 3 identifies Plaintiff’s debt as

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delinquent and overdue since March 1, 2009. (MTD Ex. 3, ECF No. 6-3, at 73 (“A breach

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of, and default in, the obligations for which such Deed of Trust is security has occurred in

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that payment has not been made of the following: The monthly installment which became

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due on 3/1/2009, along with late charges, and all subsequent monthly installments.”).)

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Defendant’s arguments that Plaintiff never alleged the loan was in default are

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unavailing. Plaintiff alleges in the Complaint that he “allegedly defaulted on the loan” on

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March 1, 2009, and that on February 14, 2014, he “received a notice from Resurgent and

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Shellpoint transferring servicing rights to Shellpoint.” (Compl. ¶¶ 18, 22.) Plaintiff further

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alleges that “Shellpoint acquired the servicing rights of Plaintiff’s consumer debt over four
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and a half years after default . . . .” (Id. ¶ 16; see also id. ¶ 3 (noting that Plaintiff’s claim

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is brought “as a result of Defendant’s conduct in the collection of an alleged consumer debt

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in default for over four and a half years prior to being assigned to Defendant for

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collection”).) In response to Plaintiff’s allegations, Defendant neither disputes that the

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mortgage loan was in default, nor cites to any evidence to support that argument in its MTD

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or Reply. The Court must accept as true all material allegations in the complaint, and must

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construe the complaint and all reasonable inferences drawn therefrom in the light most

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favorable to Plaintiff. Given that payments on the loan were overdue and delinquent for

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over four and a half years, the Court finds that Plaintiff sufficiently alleges facts plausibly

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showing that the debt was in default at the time it was assigned to Defendant. Accordingly,

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the Court concludes that Defendant qualifies as a debt collector under the FDCPA.

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(2)

Whether Defendant’s Conduct Violated 15 U.S.C. § 1692g

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Section 1692g governs the validation of debts and requires that “within five days

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after the initial communication with a consumer in connection with the collection of any

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debt, a debt collector shall, unless the following information is contained in the initial

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communication or the consumer has paid the debt, send the consumer a written notice.”

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§ 1692g(a). The initial communication or notice must contain the following information:

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(1) the amount of the debt; (2) the name of the creditor to whom the debt is
owed; (3) a statement that unless the consumer, within thirty days after receipt
of the notice, disputes the validity of the debt, or any portion thereof, the debt
will be assumed to be valid by the debt collector; (4) a statement that if the
consumer notifies the debt collector in writing within the thirty-day period
that the debt, or any portion thereof, is disputed, the debt collector will obtain
verification of the debt or a copy of a judgement against the consumer and a
copy of such verification or judgment will be mailed to the consumer by the
debt collector; and (5) a statement that, upon the consumer’s written request
within the thirty-day period, the debt collector will provide the consumer with
the name and address of the original creditor, if different from the current
creditor.

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Id. To satisfy the requirements of § 1692g(a), “the notice Congress required must be

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conveyed effectively to the debtor. It must be large enough to be easily read and sufficiently
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prominent to be noticed . . . [and it] must not be overshadowed or contradicted by other

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messages or notices appearing in the initial communication from the collection agency.”

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Terran v. Kaplan, 109 F.3d 1428, 1432 (9th Cir. 1997) (quoting Swanson v. S. Or. Credit

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Service, Inc., 869 F.2d 1222, 1225 (9th Cir. 1988)). In this circuit, courts assess the

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sufficiency of a notice “under the ‘least sophisticated debtor’ standard.” Swanson, 869 F.2d

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at 1225. The purpose of the standard is “ ‘to protect consumers of below average

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sophistication or intelligence,’ or those who are ‘uninformed or naïve,’ particularly when

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those individuals are targeted by debt collectors.” Gonzales, 660 F.3d at 1062 (quoting

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Duffy v. Landberg, 215 F.3d 871, 874–75 (8th Cir. 2000)). However, the standard also

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“ ‘preserv[es] a quotient of reasonableness and presum[es] a basic level of understanding

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and willingness to read with care.’ ” Id. (quoting Rosenau v. Unifund Corp., 539 F.3d 218,

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221 (3d Cir. 2008)).

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Section 1692g(b) identifies the following course of action for a consumer to dispute
a debt and the appropriate response from the debt collector:

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If the consumer notifies the debt collector in writing within the thirty-day
period described in subsection (a) that the debt, or any portion thereof, is
disputed, or that the consumer requests the name and address of the original
creditor, the debt collector shall cease collection of the debt, or any disputed
portion thereof, until the debt collector obtains verification of the debt or a
copy of a judgment, or the name and address of the original creditor, and a
copy of such verification or judgment, or name and address of the original
creditor, is mailed to the consumer by the debt collector.

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Section 1692g was added to the FDCPA “specifically to ensure that debt collectors gave

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consumers adequate information concerning their legal rights.” Swanson, 869 F.2d at 1225.

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Thus identification of the sender of the notice is central to whether a notice is deficient

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because § 1692g(a) requires the entity seeking collection of any debt to send an initial

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communication or notice with the requisite information identified above. Moreover, any

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determination on the sufficiency of a defendant’s notice of debt requires reviewing the

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information contained in the notice and the manner in which it is presented. However, §§

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1692g(a) and 1692g(b) also require that a consumer wishing to dispute a debt must do so

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within thirty days of receipt of notice of debt, and a “tardy request for verification of the

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debt [does] not trigger any obligation on the part of the [debt collector] to verify the debt.”

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Mahon v. Credit Bureau, Inc., 171 F.3d 1197, 1202 (9th Cir. 1999).

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Plaintiff alleges that on February 14, 2014, he “received a notice from Resurgent and

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Shellpoint transferring servicing rights to Shellpoint.” (Compl. ¶ 22.) Because the notice

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was not an exhibit to the Complaint, the Court is unable to ascertain from Plaintiff’s

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allegations which debt collector, Resurgent or Shellpoint, sent the notice. Furthermore, the

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Court cannot ascertain from Plaintiff’s allegations what information the notice contained,

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aside from identifying the transfer of servicing rights from Resurgent to Shellpoint.

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Consequently, the Court must find that Plaintiff’s allegations do not plausibly state a claim

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that Defendant’s notice was deficient under § 1692g(a).

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To be sure, allegations that Defendant violated § 1692g(a) are not necessary for

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Plaintiff’s claim that Defendant separately violated § 1692g(b). However, Plaintiff alleges

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that he sent Defendant “a debt validation letter disputing the amount and validity of the

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debt” on March 31, 2014, (id. ¶ 23), i.e., forty-five days after the notice sent from

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Resurgent/Shellpoint. Based on Plaintiff’s own allegations, his debt validation letter was

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untimely and Defendant was under no obligation to verify the debt. Therefore the Court

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must find that Plaintiff fails to state a facially plausible claim that Defendant violated

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§ 1692g(b) of the FDCPA. Accordingly, the Court GRANTS this portion of Defendant’s

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MTD.

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(3)

Whether Defendant’s Conduct Violated 15 U.S.C. § 1692e(2)A

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Plaintiff claims that Defendant violated § 1692e(2)A for the following reasons: (a)

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“Defendant has never substantiated the principle amount of this alleged debt as true and

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accurate;” (b) “Defendant’s correspondence regarding debt amounts due are [sic] very

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inconsistent and confusing;” and (c) “Defendant has falsely represented the character and

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amount of this debt.” (Compl. ¶ 26.) In response, Defendant argues that “the complaint

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does not contain a single specific fact connecting Shellpoint’s conduct to any FDCPA

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prohibition.” (MTD 5.)
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Under § 1692e, “[a] debt collector may not use any false, deceptive, or misleading

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representation or means in connection with the collection of any debt.” Section 1692e(2)A

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specifically identifies “[t]he false representation of—the character, amount, or legal status

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of any debt” as conduct that violates § 1692e. In this circuit, “liability under § 1692e of the

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FDCPA is an issue of law.” Gonzales, 660 F.3d at 1061. Determining whether conduct

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violates § 1692e “requires an objective analysis that takes into account whether the ‘least

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sophisticated debtor would likely be misled by a communication.’ ” Donohue v. Quick

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Collect, Inc., 592 F.3d 1027, 1030 (9th Cir. 2010) (quoting Guerrero v. RJM Acquisitions

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LLC, 499 F.3d 926, 934 (9th Cir. 2007) (internal quotation marks omitted)). Furthermore,

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the FDCPA “does not ordinarily require proof of intentional violation, and is a strict

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liability statute.” Gonzales, 660 F.3d 1055 (citing McCollough v. Johnson, Rodenburg &

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Lauinger, LLC, 667 F.3d 939, 948 (9th Cir. 2011)).

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Ultimately, Plaintiff’s claim that Defendant violated § 1692e(2)A rests on

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Defendant’s alleged failure to substantiate the amount of Plaintiff’s debt. However, as the

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Mahon court instructed, a “tardy request for verification of the debt [does] not trigger any

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obligation on the part of the [debt collector] to verify the debt.” 171 F.3d at 1202 (“If no

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written demand is made, ‘the collector may assume the debt to be valid.’ ”) (quoting Avila

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v. Rubin, 84 F.3d 222, 226 (7th Cir. 1996)). Again, based on Plaintiff’s own allegations

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and absent any allegations that Defendant’s notice was deficient, Plaintiff’s debt validation

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letter was untimely and Defendant was under no obligation to verify the debt. Therefore,

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the Court must find the debt amount to be valid, and that Plaintiff fails to state a facially

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plausible claim that Defendant violated § 1692e(2)A of the FDCPA. Accordingly, the

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Court GRANTS this portion of Defendant’s MTD.

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B. Whether Plaintiff Failed to State a Claim for Violation of the Rosenthal Act

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Plaintiff alleges that Defendant’s violations of the FDCPA also constitute violations

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of the RFDCPA under California Civil Code section 1788.17. (Compl. ¶¶ 25–26.) As

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California’s version of the FDCPA, the RFDCPA “mimics or incorporates by reference the

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FDCPA’s requirements . . . and makes available the FDCPA’s remedies for violations.”
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Riggs v. Prober & Raphael, 681 F.3d 1097, 1100 (9th Cir. 2012) (citing Cal. Civ. Code

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§ 1788.17). Therefore, whether a debt collector’s conduct “violates the [RFDCPA] turns

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on whether it violates the FDCPA.” Id. Because Plaintiff’s RFDCPA claims are based on

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the same allegations as his FDCPA claims, the analysis above, supra Section II.A.3, applies

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here and Plaintiff’s RFDCPA claims must also fail. Accordingly, the Court GRANTS this

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portion of Defendants’ MTD.

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C. Whether Judicial Estoppel Bars Plaintiff’s Claims

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Defendant argues that Plaintiff’s claims are judicially estopped for failure to disclose

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them in his three prior bankruptcies. (MTD 3.) In response, Plaintiff argues that “[t]he

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alleged bankruptcies have been withdrawn by plaintiff and as a result have no bearing on

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the claims of the defendants making their claims moot as a result.” (Opp’n 7.) Plaintiff

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further argues that he has always maintained the same position in each of his three

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bankruptcy cases, i.e., “that the alleged debt is and has been disputed” and that Defendant

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has “never validat[ed] or verif[ied] the alleged debt.” (Id. at 7–8.) However, because the

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Court above determined that Plaintiff’s causes of action should be dismissed, the Court

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does not reach this argument.

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D. Whether Plaintiff Failed to Include a Necessary and Indispensable Party

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Finally, Defendant argues that Plaintiff’s failure to join Sarah A. Mayen, a co-

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borrower on the mortgage loan, as an indispensable party under Fed. R. Civ. P. 19(a) is a

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sufficient basis for dismissal. (MTD 7; Reply 4.) Again, because the Court above

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determined that Plaintiff’s causes of action should be dismissed, the Court does not reach

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this argument.

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CONCLUSION

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For the reasons stated above, the Court GRANTS IN PART and DENIES IN

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PART Defendant’s RJN, (ECF No. 6-1), and GRANTS Defendant’s MTD on all causes

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of action, (ECF No. 6). Nonetheless, the Court will not yet dismiss Plaintiff’s claims with

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prejudice. E.g., Polich v. Burlington N. Inc., 942 F.2d 1467, 1472 (9th Cir. 1991)

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(“Dismissal without leave to amend is improper unless it is clear, upon de novo review,
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that the complaint could not be saved by any amendment.” (citing Kelson v. City of

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Springfield, 767 F.2d 651, 653 (9th Cir. 1985))). Accordingly, the Court DISMISSES

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WITHOUT PREJUDICE Plaintiff’s Complaint and GRANTS Plaintiff leave to file an

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amended Complaint, if any, on or before fourteen days from the date on which this Order

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is electronically docketed.

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IT IS SO ORDERED.
Dated: August 16, 2017

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