Doran et al v. Wells Fargo Bank, National Association et al

Filing 58

ORDER DENYING 39 DEFENDANT'S MOTION TO DISMISS SECOND AMENDED COMPLAINT. Signed by District JUDGE LESLIE E. KOBAYASHI on March 28, 2012. (bbb, )CERTIFICATE OF SERVICEParticipants registered to receive electron ic 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
RICHARD A. DORAN AND PATRICIA )
R. DORAN,
)
)
Plaintiffs,
)
)
vs.
)
)
WELLS FARGO BANK, ET AL.,
)
)
Defendants.
)
_____________________________ )

CIVIL NO. 11-00132 LEK-KSC

ORDER DENYING DEFENDANT’S MOTION
TO DISMISS SECOND AMENDED COMPLAINT
Before the Court is Defendant Wells Fargo Bank,
National Association’s1 (“Defendant”) Motion to Dismiss Second
Amended Complaint (“Motion”), filed on December 2, 2011.
Plaintiffs Richard A. Doran and Patricia R. Doran, individually
and as trustees of the Richard A. Doran and Patrician R. Doran
Family Trust (“the Trust”, all collectively “Plaintiffs”) filed
their memorandum in opposition on January 17, 2012, and Defendant
filed its reply on February 17, 2012.

The Court finds this

matter suitable for disposition without a hearing pursuant to
Rule LR7.2(d) of the Local Rules of Practice of the United States
District Court for the District of Hawai`i (“Local Rules”).
After careful consideration of the Motion, supporting and
opposing memoranda, and the relevant legal authority, Defendant’s
1

Wells Fargo Bank, National Association, is also known as
Wells Fargo.

Motion is HEREBY DENIED for the reasons set forth below.
BACKGROUND
The parties and this Court are familiar with the
factual and procedural background of this case, which are set
forth in this Court’s prior orders: the May 31, 2011 Order
Granting Defendant’s Motion to Dismiss Complaint filed
February 8, 2011 (“5/31/11 Order”), 2011 WL 2160643; and the
October 31, 2011 Order Granting in Part and Denying in Part
Defendant’s Motion to Dismiss First Amended Complaint Filed
June 13, 2011 (“10/31/11 Order”), 2011 WL 5239738.

This Court

therefore will only discuss the events that are relevant to the
instant Motion.
The 10/31/11 Order dismissed Plaintiffs’ wrongful
foreclosure claim, infliction of emotional distress claim, and
loss of consortium claim with prejudice and dismissed Plaintiffs’
fraud claim without prejudice.

As to the fraud claim in

Plaintiffs’ First Amended Complaint, this Court reiterated the
standards set forth in the 5/31/11 Order, 2011 WL 5239738, at
*7-8 (quoting 5/31/11 Order, 2011 WL 2160643, at *12, *11), and
stated:
Plaintiffs’ First Amended Complaint fails to
offer any details as to the time, place, or
content of the allegedly fraudulent statements.
The First Amended Complaint merely makes general
allegations, for example, stating that Defendant
“made a number of statements that Plaintiffs were
‘pre-qualified’ for loan modification”, but
Plaintiffs have not provided the required
2

information about these misrepresentations. The
general allegations in the First Amended Complaint
are not sufficient to satisfy the pleading
standard for fraud claims.
Fraud claims must, “in addition to pleading
with particularity, also must plead plausible
allegations. That is, the pleadings must state
‘enough fact[s] to raise a reasonable expectation
that discovery will reveal evidence of [the
misconduct alleged].’” Cafasso [ex rel. United
States v. Gen. Dynamics C4 Sys. Inc.], 637 F.3d
[1047,] 1055 [(9th Cir. 2011)] (citing Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 566, 127
S. Ct. 1955, 167 L. Ed. 2d 929 (2007))
(alterations in Cafasso) (footnotes omitted). The
Court acknowledges that, at this stage of the
case, Plaintiffs may not have documentary evidence
supporting their allegations and they may not know
the names of the persons who made the
representations. Plaintiffs, however, must plead
enough facts to raise a reasonable expectation
that discovery would reveal evidence of such a
misrepresentation. Plaintiffs must allege the
time, place, and content of the allegedly
fraudulent statements in order to satisfy the Rule
9(b) standard of particularity.
Further, Plaintiffs must also plead plausible
allegations that they reasonably relied on
Defendant’s misrepresentations to their detriment.
While it is understandable that the Dorans have
suffered hardships because of the foreclosure on
their home, it does not necessarily follow that
the Trust’s reliance on the alleged
misrepresentations regarding the loan modification
process caused harm to the Trust.
Id. at *8 (some alterations in 10/31/11 Order).

The Court

cautioned Plaintiffs that, if their Second Amended Complaint did
not comply with the pleading standards set forth in the 10/31/11
Order, the Court would dismiss Plaintiffs’ fraud claim with
prejudice.

Id. at *12.

3

Plaintiffs filed their Second Amended Complaint on
November 18, 2011.

[Dkt. no. 38.]

The only claim in the Second

Amended Complaint is a fraud claim, [id. at ¶¶ 31-61,] and
Defendant is the only named defendant [id. at ¶¶ 3-4].

The

Second Amended Complaint admits that Defendant “did not commit
fraud because it promised a loan modification to Plaintiffs[.]”
Instead, Plaintiffs allege that Defendant “committed fraud
because it stated, through various representatives, that
[Defendant] was exploring loss mitigation alternatives with
[Plaintiffs], when it was in fact, not considering them for
anything but foreclosure[.]”
I.

[Id. at ¶ 39.]

Defendant’s Motion
Defendant argues that the Second Amended Complaint

still fails to allege Plaintiffs’ fraud claim with the requisite
particularity and still fails to state a claim that is plausible
on its face.

Defendant urges the Court to dismiss the Second

Amended Complaint with prejudice because the Court has given
Plaintiffs ample guidance and Plaintiffs have failed to correct
the deficiencies that this Court identified.

[Mem. in Supp. of

Motion at 2.]
Defendant argues that Plaintiffs have not identified,
inter alia, who made the allegedly false statements, who received
them, the dates the statements were made, and what the specific
content of those statements was.

Defendant contends that the

4

allegations of the Second Amended Complaint do not give Defendant
sufficient notice, and therefore Defendant has not had the
opportunity to prepare a defense to Plaintiffs’ claim.
8-9.]

[Id. at

Defendant also asserts that Plaintiffs have failed to

present plausible allegations that Plaintiffs reasonably relied
on the alleged misrepresentations to their detriment or that
Plaintiffs suffered pecuniary damages as a result of that
reliance.

[Id. at 10.]
In addition, Defendant argues that some of the factual

allegations in the Second Amended Complaint that “are not
warranted based on the evidence and are not likely to have
evidentiary support after a reasonable opportunity for
investigation[,]” and Defendant alleges that Plaintiffs and their
counsel “have misrepresented facts to the court and are in clear
violation of their obligations under [Fed. R. Civ. P.] 11 and the
Hawaii Rules of Professional Conduct.”
II.

[Id. at 14-15.]

Plaintiffs’ Memorandum in Opposition
Plaintiffs argue that they have sufficiently pled the

requirements of a fraud claim.

Plaintiffs argue that the Court

should not require Plaintiffs to include the names of the
specific representatives of Defendant who made the alleged
misrepresentations because Plaintiffs cannot obtain this
information without discovery.

Further, Plaintiffs contend that,

for purposes of a motion to dismiss, their allegation that

5

Defendant’s representatives made the alleged false statements to
the Dorans and their agent, as well as their allegation that the
statements were made from January 2010 to September 9, 2010 are
sufficient.

[Mem. in Opp. at 10.]

As to Plaintiffs’ detrimental reliance, Plaintiffs
argue that, to survive a motion to dismiss, they are only
required to allege facts that are plausible on their face; the
standard is not plausibility on the facts.

They assert that they

have presented plausible allegations that they relied on
Defendant’s misrepresentations by giving up other loss mitigation
options and, as a result, they incurred attorneys’ fees and
jeopardized Mr. Doran’s career.

[Id. at 11-12.]

Plaintiffs also

argue that this reliance was reasonable under the circumstances,
and there is a clear causal connection between the false
representations and Plaintiffs’ damages.

[Id. at 14-15.]

Finally, Plaintiffs argue that, if the Court dismisses
the Second Amended Complaint, the Court should grant leave to
amend.

[Id. at 15-16.]

III. Defendant’s Reply
Defendant acknowledges that Fed. R. Civ. P. 9(b) does
not always require that plaintiffs plead precise dates and times
of the alleged fraud, but Defendant argues that the Second
Amended Complaint’s allegation of an unspecified number of
misrepresentations over a nine-month period does not give

6

Defendant sufficient notice of Plaintiffs’ claim.

Defendant

acknowledges that particularity requirements may be relaxed where
the evidence of a corporation’s fraud is in the sole possession
of the Defendant.

Plaintiffs, however, should be required to

identify the specific person who heard the alleged
misrepresentation and, because Plaintiffs and/or their agent were
the direct recipients of the alleged misrepresentations, they
cannot fairly claim that Defendant has sole possession of the
facts proving the alleged fraud.

[Reply at 2-3.]

As to Plaintiffs’ alleged detrimental reliance,
Defendant argues that other district courts have rejected
similarly vague allegations that the plaintiff gave up loss
mitigation alternatives.

Even assuming arguendo that Plaintiffs

did give up other opportunities, Plaintiffs have not alleged how
this caused them damages, and such reliance was not reasonable.
[Id. at 4-5.]

Further, Defendant reiterates that Plaintiffs have

not pled that there was a plausible connection between
Plaintiffs’ pecuniary damages and the alleged misrepresentations.
The Second Amended Complaint does not allege that Mr. Doran lost
his contractor’s license, and attorneys’ fees, and litigation
costs alone do not constitute pecuniary damages sufficient for a
fraud claim.

[Id. at 8-9.]

Finally, Defendant argues that, pursuant to this
Court’s warning in the 10/31/11 Order, the Court must dismiss

7

Plaintiffs’ Second Amended Complaint with prejudice.
DISCUSSION
The applicable standards are fully set forth in the
10/31/11 Order.

2011 WL 5239738, at *6-7.

In pertinent part, to

survive a Fed. R. Civ. P. 12(b)(6) motion to dismiss, “a
complaint must contain sufficient factual matter to ‘state a
claim to relief that is plausible on its face.’”

Hawaii

Motorsports Inv., Inc. v. Clayton Group Servs., Inc., 693 F.
Supp. 2d 1192, 1195-96 (D. Hawai`i 2010) (quoting Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 167 L. Ed. 2d 929
(2007)).

Pursuant to Fed. R. Civ. P. 9(b), a plaintiff must

plead fraud claims with particularity.

This includes alleging

“the time, place, and content of the fraudulent representation;
conclusory allegations do not suffice.”

Shroyer v. New Cingular

Wireless Servs., Inc., 622 F.3d 1035, 1042 (9th Cir. 2010)
(citation omitted).
I.

Particularity
Defendant first urges the Court to dismiss the Second

Amended Complaint because Plaintiffs failed to plead fraud with
the requisite particularity.

Defendant argues that Plaintiffs

have only pled generalized allegations and that Plaintiffs
“fail[ed] to identify the speakers of the false statements, the
recipient of the statements, the dates when these statements were
made, specific content such as excerpts from their
8

correspondence, or other information necessary to satisfy the
requirements of Rule 9(b).”

[Mem. in Supp. of Motion at 8-9.]

Defendant contends that Ninth Circuit case law requires that the
allegations of a fraud claim “include a specific account ‘of the
time, place, and specific content of the false representations as
well as the identities of the parties to the
misrepresentations[.]’”

[Id. at 9 (quoting Swartz v. KPMG LLP,

476 F.3d 756, 764 (9th Cir. 2007)).]
The Second Amended Complaint alleges that “[f]rom about
January 2010 until their property sold at public auction on
September 9, 2010, Plaintiffs, or their attorneys, were in
contact via telephone and correspondence with representatives
from Wells Fargo regarding a loan modification[.]”
Amended Complaint at ¶ 32.]

[Second

Defendant argues that Plaintiffs’

vague allegations of a broad, nine-month time period do not
satisfy Rule 9’s particularity requirement.

[Reply at 2 (citing

Segal Co. v Amazon, 280 F. Supp. 2d 1229 (W.D. Wash. 2003) (where
plaintiffs alleged that defendant’s misrepresentations occurred
over course of several weeks, the complaint did not adequately
indicate when and where alleged fraud took place); Levyas v. Bank
of America Corp.,2 601 F. Supp. 2d 1201, 1217 (S.D. Cal. 2009)
(where complaint specified a nine month time frame in which the

2

Levyas is also known as In re Countrywide Financial Corp.
Mortgage Marketing and Sales Practices Litigation.
9

misrepresentations were allegedly made, such allegations failed
to satisfy the requirements of Rule 9(b))).]

Defendant also

argues that the Second Amended Complaint’s identification of
“Plaintiffs, or their attorneys” as the parties who received the
alleged misrepresentations does not provide the required
particularity.

[Id. at 2-3.]

First, Defendant’s recitation of the pleading
requirements set forth in Swartz is not entirely accurate.

The

language that Defendant relies upon appears in the following
context:
[where] a complaint includes allegations of fraud,
Federal Rule of Civil Procedure 9(b) requires more
specificity including an account of the “time,
place, and specific content of the false
representations as well as the identities of the
parties to the misrepresentations.” Edwards v.
Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir.
2004) (citation omitted). “To comply with Rule
9(b), allegations of fraud must be specific enough
to give defendants notice of the particular
misconduct which is alleged to constitute the
fraud charged so that they can defend against the
charge and not just deny that they have done
anything wrong.” Bly-Magee v. California, 236
F.3d 1014, 1019 (9th Cir. 2001) (citation,
quotations omitted).
Swartz, 476 F.3d at 764.

Although requiring that the allegations

of place and time be specific enough to put the defendant on
notice of the claim against it, Swartz does not state that the
plaintiff must plead the specific time and place that a
fraudulent representation occurred.

Further, although Defendant

states that Levyas involved a nine-month time frame (which is the
10

same period Plaintiffs allege in paragraph 32 of the Second
Amended Complaint), the district court in that case actually
concluded that the plaintiff’s “time frame, from January 9, 2004,
to September 28, 2005, is not specific enough.”
at 1217.

601 F. Supp. 2d

Thus, Levyas involved a period of one year and nine

months.
Defendant also relies on Segal, in which the district
court ruled, inter alia:
In this case, plaintiffs fail to specify the
identities of the alleged fraud perpetrators, the
time and place the fraudulent statements were
made, and exactly what statements were fraudulent.
First, the complaint’s reference to certain
“representatives” of defendant is too vague to
sufficiently identify the alleged perpetrators.
Second, plaintiffs’ assertion that defendant’s
misrepresentations occurred over the course of
“several weeks” does not adequately indicate when
and where the alleged fraud took place.
280 F. Supp. 2d at 1231 (citations omitted).

Defendant argues

that the Court should similarly dismiss the instant case because
Plaintiffs also allege only that Defendant’s representatives made
fraudulent misrepresentations to Plaintiffs or Plaintiffs’
counsel over a nine-month period.

[Second Amended Complaint at ¶

32.]
As previously stated, however, the Ninth Circuit has
not held that, where the defendant is a business entity, the
plaintiff must plead the names of defendant’s representatives who
allegedly made the fraudulent misrepresentations.
11

In Edwards v.

Marin Park, Inc., the plaintiff alleged that “the management of
the park sent her unjustified, harassing pre-eviction notices in
order to drive her from her tenancy[,]” and the Ninth Circuit
stated that her claim under the Racketeer Influenced and Corrupt
Organizations Act named the parties involved, but failed to plead
the content with sufficient particularity.

356 F.3d at 1060,

1066; accord Hernandez v. Aurora Loan Servs., LLC, No. CV 1100607 AHM(OPx), 2011 WL 6178881, at *6 (C.D. Cal. Dec. 13, 2011)
(“By alleging a date, a time frame, and the general type of
employee (telephone representative), Plaintiffs have met the
pleading standards of Rule 9(b).”3 (citing Susilo v. Wells Fargo
Bank, N.A., 2011 WL 2471167 at *10 (C.D. Cal. June 21, 2011)
(motion to dismiss denied where the “only arguable deficiency in
plaintiff’s allegations of fraud is that [they did] not state the
names of all the individual representatives of defendants”);
People v. Highland Fed. Sav. & Loan, 14 Cal. App. 4th 1692, 19

3

In Hernandez, the relevant events included:
July 2010—December 2010: Plaintiffs were advised
by an Aurora representative, whose name is unknown
to Plaintiffs, that their loan modification
application was still under review, and that they
should continue making the same monthly payments
in accordance with the SFA pending such review.
Compl. ¶ 12. In reliance on these
representations, Plaintiffs allege they continued
to make payments until December 2010, which Aurora
accepted. Id.

2011 WL 6178881, at *2 (emphasis in original).
12

Cal. Rptr. 2d 555, 570 (Cal. Ct. App. 1993) (allegation for fraud
against “‘each record owner,’ without any further identification
or limitation . . . ‘at the time of each respective record
owner’s ownership’” were stated with “ample particularity”))).
This Court therefore is not persuaded that it should apply Segal
and other similar cases to support a ruling that Plaintiffs’
allegation that Defendant’s representatives made fraudulent
misrepresentations fails to meet Rule 9(b)’s particularity
standard.
Similarly, the Court is not persuaded by Segal’s ruling
that a time period of a few weeks is insufficient to plead fraud
with particularity.

The crux of the pleading with particularity

requirement is that the plaintiff must provide the defendant with
enough information to put the defendant on notice of the alleged
misconduct.

In the present case, Plaintiffs allege that

Defendant’s representatives made a number of fraudulent
statements to Plaintiffs and their counsel, by telephone and in
written correspondence, from January 2010 up to the September 9,
2010 foreclosure sale of the subject property.
Complaint at ¶ 32.]

[Second Amended

In addition, the Second Amended Complaint

alleges:
16. On September 9, 2010, Plaintiffs, after
prompting by Defendant Wells Fargo, sent Defendant
Wells Fargo yet another complete modification
package;
17. When Plaintiffs followed up with
Defendant Wells Fargo one week later, a
13

representative told Plaintiffs that their
modification paperwork could not be found. Their
modification package was misplaced again.
18. On September 17, 2010, Plaintiffs again
followed up with Defendant Wells Fargo and were
informed that the paperwork was now found, but
that the file had been transferred from the
modification department to the short sale
department without Plaintiffs’ consent;
19. Plaintiffs never requested that their
file be converted from a loan modification
negotiation to a short sale negotiation, nor did
any agent of Plaintiffs’ ever request this
transfer;
20. According to the Wells Fargo
representative, Plaintiffs allegedly cancelled
their loan modification on September 10,
2010. . . .
[Id. at pg. 4.]

The Court finds that, under the circumstances of

this case, where the Dorans were negotiating with a national bank
over an extended period of time in an attempt to obtain a loan
modification to enable them to remain in their home, the
allegations of the Second Amended Complaint are sufficient to put
Defendant on notice of when the alleged fraud occurred.4
The Court also finds that the Second Amended Complaint
sufficiently pleads the specific content of Defendant’s alleged
misrepresentations.

Plaintiffs allege that Defendant’s

representatives stated that Plaintiffs were in the loan
modification program and that their file was being reviewed, when

4

In contrast, the fraud claim in Segal arose from a dispute
over the terms of an oral contract between two business entities.
280 F. Supp. 2d at 1230 (the defendant engaged one of the
plaintiff’s divisions “to prepare stock-option valuation and
employee compensation proposals for defendant”).
14

in fact Defendant was not reviewing Plaintiffs’ file and
Defendant had no intention of modifying Plaintiffs’ loan.

[Id.

at ¶¶ 33-35, 41.]
The Court therefore concludes that Plaintiffs have pled
their fraud claim with sufficient particularity to satisfy Rule
9(b).
II.

Plausibility
Defendant next urges the Court to dismiss the Second

Amended Complaint because Plaintiffs fail to state a claim that
is plausible on its face.

Defendant argues that the Second

Amended Complaint does not allege plausible allegations that
Plaintiffs reasonably relied upon Defendant’s representations to
their detriment, further, Plaintiffs cannot establish a causal
connection between Defendant’s representations and their damages.
As recognized in the 10/31/11 Order, a plaintiff must
plead the facts supporting a fraud claim with plausibility as
well as particularity.

2011 WL 5239738, at *7 (quoting Cafasso

ex rel. United States v. Gen. Dynamics C4 Sys., Inc., 637 F.3d
1047, 1055 (9th Cir. 2011)).

“A claim has facial plausibility

when the plaintiff pleads factual content that allows the court
to draw the reasonable inference that the defendant is liable for
the misconduct alleged.”

Ashcroft v. Iqbal, 129 S. Ct. 1937,

1949 (2009).

15

Having reviewed the allegations of the Second Amended
Complaint, the Court FINDS that the allegations support a
reasonable inference that: 1) Plaintiffs detrimentally relied on
Defendant’s alleged misrepresentations; 2) Plaintiffs’ reliance
was reasonable; and 3) there is a causal connection between
Defendant’s alleged misrepresentations and Plaintiffs’ damages.
The Court therefore CONCLUDES that Plaintiffs have pled a
plausible fraud claim.
III. Unwarranted Factual Allegations
Finally, Defendant argues that “many of the factual
contentions in the Second Amended Complaint are not warranted
based on the evidence and are not likely to have evidentiary
support after a reasonable opportunity for investigation.”
in Supp. of Motion at 14.]

[Mem.

Although emphasizing that it is not

an exhaustive list, Defendant identifies Plaintiffs’ allegations
relating to the equity which Plaintiffs had in the subject
property and Defendant’s foreclosure on the property.5

Defendant

argues that, in the course of the Dorans’ bankruptcy proceedings,
it came to light that there was no equity in the subject

5

Defendant argues that the inclusion of these allegations
violated the obligations that Fed. R. Civ. P. 11 imposes on
Plaintiffs and their counsel. [Mem. in Supp. of Motion at 1416.] The Court, however, will not address this argument because
a party cannot seek Rule 11 sanctions within a motion to dismiss.
Fed. R. Civ. P. 11(c)(2) (“A motion for sanctions must be made
separately from any other motion and must describe the specific
conduct that allegedly violates Rule 11(b). . . .”).
16

property.

[Id. at 15; Motion, Decl. of Counsel (“Counsel

Decl.”), Exh. D (Motion for Relief from Automatic Stay), Exh. E
(Order Granting Relief from Stay).]

Defendant points out that US

Bank National Association, not Defendant, foreclosed on the
subject property and purchased the property a public auction.
[Mem. in Supp. of Motion at 15; Counsel Decl., Exh. C
(Mortgagee’s Aff. of Foreclosure Sale Under Power of Sale).]
This Court took judicial notice of the docket in the
Dorans’ bankruptcy proceeding in the 5/31/11 Order.

The Court,

however, did so to determine whether any of the Dorans’ claims
were barred by the doctrine of judicial estoppel.
2160643, at *7-10.

2011 WL

In so doing, the Court ruled that the Dorans’

fraud claim was not subject to judicial estoppel.

Id. at *9.

Defendant now asks the Court to consider documents from the
Dorans’ bankruptcy proceeding to conclude that Plaintiffs are
judicially estopped from alleging that they had equity in the
subject property during the period at issue in this case.
in Supp. of Motion at 15.]

[Mem.

Even assuming, arguendo, that

Plaintiffs were judicially estopped from making that allegation,
it would not require this Court to dismiss Plaintiffs’ fraud
claim.
Further, this district court has recognized that:
When a defendant attaches exhibits to a motion to
dismiss, the court ordinarily must convert the
motion into a summary judgment motion so that the
plaintiff has an opportunity to respond. Parrino
17

v. FHP, Inc., 146 F.3d 699, 706 n.4 (9th Cir.
1998). However, a court “may consider evidence on
which the complaint ‘necessarily relies’ if: (1)
the complaint refers to the document; (2) the
document is central to the plaintiff’s claim; and
(3) no party questions the authenticity of the
copy attached to the 12(b)(6) motion.” Marder v.
Lopez, 450 F.3d 445, 448 (9th Cir. 2006). The
court may treat such a document as “part of the
complaint, and thus may assume that its contents
are true for purposes of a motion to dismiss under
Rule 12(b)(6).” United States v. Ritchie, 342
F.3d 903, 908 (9th Cir. 2003).
Yamalov v. Bank of Am. Corp., CV. No. 10–00590 DAE–BMK, 2011 WL
1875901, at *7 n.7 (D. Hawai`i May 16, 2011).

This Court could

consider the bankruptcy documents and the Mortgagee’s Affidavit
that Defendant attached to the Motion if the documents meet the
necessary requirements.

The parties do not contest the accuracy

of the documents, and the Second Amended Complaint does refer to
Defendant’s foreclosure on the subject property.

The Second

Amended Complaint also notes that the Dorans declared Chapter 7
bankruptcy, but the Second Amended Complaint does not refer to
the motion for, or the order granting, relief from the automatic
stay.

Further, the Court finds that none of the three documents

are central to Plaintiffs’ fraud claim, which is based upon the
allegation that Defendant represented that Plaintiffs were being
considered for loan modification but that Defendant never
intended to consider modifying Plaintiffs’ loan.

Plaintiffs’

theory that Defendant sought to receive a windfall from
foreclosing on the subject property and acquiring it attempts to

18

explain why Defendant made the alleged misrepresentations, but
Defendant’s motive is not central to Plaintiffs’ fraud claim.
The Court therefore concludes that considering the motion for,
and the order granting, relief from the automatic bankruptcy stay
and the Mortgagee’s Affidavit would convert the instant Motion
into a motion for summary judgment.
discretion, declines to do so.

This Court, in its

Defendant, of course, may still

litigate the truth of the factual allegations in the Second
Amended Complaint through a motion for summary judgment or at
trial.
CONCLUSION
On the basis of the foregoing, Defendant’s Motion to
Dismiss Second Amended Complaint, filed December 2, 2011, is
HEREBY DENIED.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAII, March 28, 2012.

/S/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge

RICHARD A. DORAN and PATRICIA R. DORAN V. WELLS FARGO BANK, N.A.,
ET AL; CIVIL NO. 11-00132 LEK-KSC; ORDER DENYING DEFENDANT’S
MOTION TO DISMISS SECOND AMENDED COMPLAINT

19