Peyton et al v. Option One Mortgage Corporation et al
ORDER DENYING PLAINTIFFS' MOTION UNDER RULES 59 AND 60 OF THE FEDERAL RULES OF CIVIL PROCEDURE 67 - Signed by CHIEF JUDGE SUSAN OKI MOLLWAY on 10/17/11. (emt, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
ROBERT V. PEYTON and MARIE T. )
OPTION ONE MORTGAGE
CORPORATION, a California
Corporation, n/k/a SAND
CANYON CORPORATION; and
DEUTSCHE BANK NATIONAL TRUST )
COMPANY, AS TRUSTEE FOR HSI
CORPORATION TRUST 2006-OPT3, )
CERTIFICATES, SERIES 2006)
CIVIL NO. 10-00186 SOM/KSC
ORDER DENYING PLAINTIFFS’
MOTION UNDER RULES 59 AND 60
OF THE FEDERAL RULES OF CIVIL
ORDER DENYING PLAINTIFFS’ MOTION UNDER RULES 59 AND 60
OF THE FEDERAL RULES OF CIVIL PROCEDURE
This case arose out of an October 2005 residential
mortgage loan by Defendant Option One Mortgage Corporation to
Robert and Marie Peyton.
Option One, now known as Sand Canyon
Corporation, subsequently assigned the loan to Deutsche Bank
National Trust Company, as Trustee for HSI Asset Securitization
Corporation Trust 2006-Opt3, Mortgage Pass-Through Certificates,
Plaintiffs’ First Amended Complaint alleged
that Sand Canyon and Deutsche Bank violated the Truth in Lending
Act (“TILA”), 15 U.S.C. §§ 1601-1667, by failing to provide the
Peytons with sufficient disclosures when they obtained their
mortgage loan in 2005 and by failing to honor an October 11,
2008, rescission notice.
The First Amended Complaint sought
damages and rescission of the loan.
In March 2011, the court granted in part and denied in
part a motion for summary judgment filed by Sand Canyon.
No. 42, March 31, 2011.
The court held that Sand Canyon could
not be sued for rescission or cancellation of the loan, as it no
longer owned the loan and therefore lacked the authority to
effectuate either rescission or cancellation of the loan.
Although TILA damage claims against Sand Canyon based on alleged
failures to properly disclose information concerning the loan
were time-barred, the court ruled that Sand Canyon had not
demonstrated entitlement to summary judgment on the TILA damage
claims against Sand Canyon based on an alleged failure to honor
the Peyton’s request for rescission.
On June 15, 2011, Sand Canyon again moved for summary
judgment on the remaining claims asserted against it.
That same day, Deutsche Bank moved for summary judgment
on all claims asserted against it.
See ECF No. 53.
On August 1,
2011, the court granted both motions without a hearing.
Order Granting Motions for Summary Judgment in Favor of
Defendants on All Remaining Claims, ECF No. 64, Aug. 3, 2011.
On August 31, 2011, Plaintiffs filed a motion pursuant
to Rules 59(e), 60(b)(1), and 60(b)(6) of the Federal Rules of
That motion is denied without a hearing
pursuant to Local Rule 7.2(d).
On June 15, 2011, Sand Canyon filed a motion for
summary judgment and a concise statement in support of its
See ECF Nos. 51 and 52.
That same day, Deutsche Bank
filed its own motion for summary judgment and concise statement
in support of its motion.
See ECF Nos. 53 and 54.
On June 16,
2011, the court issued a notice of hearing for both motions,
setting the motions for hearing on August 1, 2011.
See ECF No.
Later in the day on June 16, 2011, both Sand Canyon and
Deutsche Bank filed redacted versions of exhibits to their
respective concise statements.
See ECF Nos. 56 and 57.
On July 11, 2011, Plaintiffs filed an opposition to
Sand Canyon’s motion for summary judgment, as well as a concise
statement in opposition to the motion.
See ECF Nos. 58 and 59.
Plaintiffs did not timely file an opposition to Deutsche Bank’s
motion for summary judgment.
One of the attorneys for
Plaintiffs, Gary Victor Dubin, indicates that he was unaware of
Deutsche Bank’s motion, noting that “perhaps . . . the motion
papers went into my email spam box,” which is “cleared
automatically every thirty days.”
See Declaration of Gary Victor
Dubin ¶ 3, ECF No. 67-1, Aug. 31, 2011.
Dubin’s statement, by
itself, is insufficient to demonstrate that Plaintiffs lacked
notice of Deutsche Bank’s motion.
The record reflects that Plaintiffs are represented by
four attorneys associated with the Dubin Law Offices, Benjamin
Ruel Brower, Frederick J. Arensmeyer, Long Huy Vu, and Dubin.
The record further reflects that Notices of Electronic Filing
(“NEF”) for Deutsche Bank’s motion and concise statements were
sent electronically to Brower, Arensmeyer, and Dubin at their
respective email addresses and to Vu via U.S. mail at the address
of record for the Dubin Law Offices.
See NEFs for ECF Nos. 53,
The Certificates of Service for the same documents
indicate that they were served on Dubin and Arensmeyer through
CM/ECF and served on Brower and Vu through U.S. mail.
Nos. 53-2, 54-15, 57-8.
Brower, Arensmeyer, and Vu do not submit
declarations indicating that they had no notice of Deutsche
Accordingly, on the present record, it appears
that Plaintiffs had notice of Deutsche Bank’s motion.
Plaintiffs’ timely filing of their opposition to Sand
Canyon’s motion twenty-one days before the scheduled hearing
indicates that Plaintiffs knew about the hearing on that motion,
as the deadline for such oppositions is twenty-one days before
the scheduled hearing.
See Local Rule 7.4.
Because the hearing
for Sand Canyon’s motion was set in the same filing as the
hearing for Deutsche Bank’s motion, see ECF No. 55, Plaintiffs
are unconvincing in implying that they had no notice of Deutsche
Bank’s motion in mid-June 2011, when that motion was filed.
Plaintiffs’ counsel says that he was in the process of
preparing a motion seeking leave to file an untimely opposition
to Deutsche Bank’s motion when the court, through a law clerk,
contacted counsel about that opposition.
says that he “fully explained the situation to the law clerk, who
said that he would talk to the Judge and call [him] back.”
paragraphs 4 and 5 of his declaration, Plaintiffs’ counsel says
that this court instructed him to file a single-page opposition
to Deutsche Bank’s motion that incorporated by reference previous
arguments raised by Plaintiffs.
Plaintiffs’ counsel then accuses
the court of “lulling” him into believing that such an opposition
See Dubin Decl. ¶¶ 4-5.
declaration omits several notable facts.
In the course of routine prehearing preparation for the
hearing scheduled August 1, 2011, the court’s law clerk noticed
that Plaintiffs had not filed any opposition to Deutsche Bank’s
In keeping with its usual practice with respect to
unopposed motions, the court directed its law clerk to telephone
Dubin, Plaintiffs’ counsel, to ask whether Plaintiffs had
intended to oppose Deutsche Bank’s motion.
Dubin told the law
clerk, either in that conversation or in a follow-up telephone
call, that Plaintiffs did intend to oppose the motion and that,
because Deutsche Bank’s motion was similar to another motion,
Plaintiffs were thinking of filing a short opposition that
incorporated by reference arguments made in connection with that
Dubin did not tell the law clerk that Dubin was
preparing a motion seeking leave to file an untimely opposition.
The law clerk then told Dubin that the law clerk needed to check
with the judge to see whether Plaintiffs would be allowed to file
such an opposition.
After speaking with this judge, the law
clerk then telephoned Dubin to tell Dubin that Plaintiffs could
oppose Deutsche Bank’s motion by filing the short opposition
Dubin had described, i.e., a statement that incorporated by
reference arguments previously made.
Notably omitted from the present reconsideration motion
is any mention of Dubin’s own statement about a simple
incorporation of an already filed memorandum.
limitation on what Plaintiffs could argue in their extremely
untimely opposition simply echoed what Dubin had indicated he
wanted to do.
Had Dubin informed the law clerk that he wanted to
file a more substantive opposition, the court would have told the
law clerk to tell Dubin to file a motion seeking leave to file an
attached proposed opposition.
It was only because the opposition
proposed by Dubin when he spoke to the law clerk was simply an
incorporation by reference of arguments previously made that the
court allowed the untimely opposition to be filed without a
motion, perceiving no prejudice to Deutsche Bank through such a
In part, Plaintiffs bring this motion under Rule 59(e)
of the Federal Rules of Civil Procedure, which authorizes motions
to alter or amend judgment.
Motions to alter or amend judgment
“may not be used to relitigate old matters, or to raise arguments
or present evidence that could have been raised prior to entry of
11 Charles Alan Wright, Arthur Miller, and Mary Kay
Kane, Federal Practice and Procedure § 2810.1 (2d ed. 1995).
decision whether to grant or deny a Rule 59(e) motion is
committed to the sound discretion of this court.
Calderon, 197 F.3d 1253, 1255 n.1 (9th Cir. 1999) (“the district
court enjoys considerable discretion in granting or denying the
motion”); see also Herbst v. Cook, 260 F.3d 1039, 1044 (9th Cir.
2001) (“denial of a motion for reconsideration is reviewed only
for an abuse of discretion”).
There are four basic grounds upon
which a Rule 59(e) motion may be granted: 1) a manifest error of
law or fact upon which the judgment is based; 2) newly discovered
or previously unavailable evidence; 3) manifest injustice; and
4) an intervening change in controlling law.
McDowell, 197 F.3d
at 1255 n.1.
Plaintiffs also bring this motion under Rules 60(b)(1)
and (6) of the Federal Rules of Civil Procedure, which permit
relief from “final” judgments, orders, or proceedings based on:
“(1) mistake, inadvertence, surprise, or excusable neglect; . . .
[or] (6) any other reason that justifies relief.”
brought under Rule 59(e), Rule 60(b) motions are committed to the
discretion of the trial court.
Barber v. Haw., 42 F.3d 1185,
1198 (9th Cir. 1994) (“Motions for relief from judgment pursuant
to Federal Rule of Civil Procedure 60(b) are addressed to the
sound discretion of the district court.”).
The Ninth Circuit has
noted that, for purposes of Rule 60(b), “excusable neglect” is
Cir. 1983) (en banc).
Rodgers v. Watt, 722 F.2d 456, 460 (9th
Nevertheless, ignorance and carelessness
on the part of the party or his or her attorney do not provide
grounds for relief under Rule 60(b)(1).
Engleson v. Burlington
N. R. Co., 972 F.2d 1038, 1043 (9th Cir. 1992).
When a party
misses a filing deadline, the Ninth Circuit has instructed courts
to examine four factors to determine whether there was “excusable
neglect”: “the danger of prejudice to the debtor, the length of
the delay and its potential impact on judicial proceedings, the
reason for the delay, including whether it was within the
reasonable control of the movant, and whether the movant acted in
Briones v. Riviera Hotel & Casino, 116 F.3d 379,
381-82 (9th Cir. 1997) (adopting test and quoting from Pioneer
Inv. Servs. Co. v. Brunswick Assocs., Ltd., 507 U.S. 380 (1993));
accord Lemoge v. United States, 587 F.3d 1188, 1192 (9th Cir.
2009) (quoting Bateman v. U.S. Postal Serv., 231 F.3d 1220, 1223
(9th Cir. 2000)).
Plaintiffs’ Rule 59 and 60 motion does not discuss how
either rule is satisfied.
Instead, it blames the court for
Plaintiffs’ failure to submit a substantive opposition, claiming
that the court somehow “lulled” experienced counsel into not
submitting an opposition.
But Plaintiffs do not sufficiently
explain why they did not timely file an opposition that made all
of the arguments they now say they wished to raise.
Plaintiffs explain what evidence they would have submitted had
they filed a more substantive opposition.
At most, Plaintiffs
say that, had the court reviewed Robert Peyton’s declaration, ECF
No. 38-1, or counsel’s letter to Option One/Sand Canyon, ECF No.
38-3, the court would have identified an issue of fact.
The court granted Deutsche Bank summary judgment
because the bank had raised a rebuttable presumption that two
accurate and complete TILA notices of right to cancel were
received by Plaintiffs.
See ECF 54-9 (signed notice of right to
cancel in which Plaintiffs acknowledged receipt of two completed
copies of it); 15 U.S.C. § 1635(c) (creating a rebuttable
presumption of delivery when there is “written acknowledgment of
receipt of any disclosures required”).
The court ruled that the
allegations of the First Amended Complaint and arguments of
counsel were insufficient to rebut that presumption.
See ECF No.
64 at 6-8.
Plaintiffs now argue that, had the court reviewed
Robert Peyton’s declaration, ECF No. 38-1, or counsel’s letter to
Option One/Sand Canyon, ECF No. 38-3, the court would have found
the presumption to have been rebutted.
However, in connection
with ruling on Deutsche Bank’s motion, the court did review those
documents, determining that neither created an issue of fact as
to receipt of the notices.
Peyton’s declaration, for example,
merely states that he instructed Dubin to send a notice of
cancellation to the bank and that Peyton later received an
emailed copy of the notice of cancellation from Dubin, which he
attached to his declaration.
See ECF 38-3 ¶¶ 2-3.
not actually state in his declaration that he did not receive two
copies of the notice of right to cancel.
The notice of
cancellation sent by Dubin to Sand Canyon is a letter by Dubin
that states that Plaintiffs are cancelling their loan because
they did not receive two copies of the notice of right to
See ECF 38-3.
Dubin’s letter, however, is not
admissible evidence capable of defeating Deutsche Bank’s summary
It is simply argument by Plaintiffs’ counsel in
the form of a letter.
See Arpin v. Santa Clara Valley Transp.
Agency, 261 F.3d 912, 923 (9th Cir. 2001) (noting that arguments
of counsel are not evidence capable of creating issues of fact to
defeat a motion for summary judgment); Estrella v. Brandt, 682
F.2d 814, 819-20 (9th Cir. 1982) (stating that legal memoranda
and counsel’s oral argument are not evidence and do not create
issues of fact capable of defeating a motion for summary
Had Dubin submitted Plaintiffs’ own declarations
indicating that they did not receive the required notices, that
would have been a different matter.
See, e.g., Rodrigues v.
Newport Lending Corp., 2010 WL 4960065, *6 (D. Haw. Nov. 29,
2010) (holding that plaintiff’s declaration denying receipt of
TILA disclosures was sufficient to create a genuine issue of fact
concerning such receipt despite the rebuttable presumption of
delivery based on plaintiffs’ signed acknowledgment of receipt).
Dubin did not do that, either in opposition to Deutsche Bank’s
motion for summary judgment or in connection with the present
The court will not assume the existence of evidence not
Having failed to provide any evidence raising a
genuine issue of fact as to their receipt of the required
notices, and having failed to sufficiently explain why that
failure should be excused, Plaintiffs do not show entitlement to
relief pursuant to Rules 59(e) or 60(b).
For the reasons stated above, the court denies
Plaintiffs’ Rule 59(e) and 60(b) motion.
IT IS SO ORDERED.
DATED: Honolulu, Hawaii, October 17, 2011.
/s/ Susan Oki Mollway
Susan Oki Mollway
Chief United States District Judge
Peyton v. Option One Mortgage Corp.; Civil No. 10-00186 SOM/KSC; ORDER DENYING
PLAINTIFFS’ MOTION UNDER RULES 59 AND 60 OF THE FEDERAL RULES OF CIVIL PROCEDURE
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?