Levy v. Wells Fargo Bank, N.A. et al
Filing
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ORDER DENYING MOTION FOR LEAVE TO FILE AMENDED COMPLAINT 24 - Signed by CHIEF JUDGE SUSAN OKI MOLLWAY on 8/22/11. ("However, to avoid prejudicing Levy for his counsel's "administrative error," the court gives Levy l eave to file another motion to amend his complaint no later than August 29, 2011. Any proposed Amended Complaint must be attached to such a motion. If Levy fails to file such a motion, judgment will automatically be entered in favor of We lls Fargo.") (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
DAVID LEVY,
)
)
Plaintiff,
)
)
vs.
)
)
WELLS FARGO BANK, as Trustee )
for Option One Mortgage Loan )
Trust 2006-1, Asset Backed
)
Certificates, Series 2006-1; )
et al.
)
)
Defendants.
)
_____________________________ )
CIV. NO. 11-00159 SOM/KSC
ORDER DENYING MOTION FOR
LEAVE TO FILE AMENDED
COMPLAINT
ORDER DENYING MOTION FOR LEAVE TO FILE AMENDED COMPLAINT
I.
INTRODUCTION.
This court previously dismissed the Complaint in this
matter, giving Plaintiff David Levy leave to file an Amended
Complaint no later than July 12, 2011.
an Amended Complaint.
Levy did not timely file
Instead, claiming “administrative error”
with no further explanation, Levy filed a motion to file a
proposed Amended Complaint on July 14, 2011.
That motion is
denied without a hearing pursuant to Local Rule 7.2(d), which
gives this court discretion to decide any motion without a
hearing.
In deciding the motion, the court has considered the
motion itself, ECF No. 24, as well as the Opposition to the
motion, ECF No. 25.
of his motion.
Levy did not timely file a reply in support
II.
FACTUAL BACKGROUND.
On March 11, 2011, Levy filed the Complaint in this
matter.
Levy alleged that Wells Fargo Bank, as Trustee for
Option One Mortgage Loan Trust 2006-1, Asset Backed Certificates,
Series 2006-1 (“Wells Fargo”), had violated state and federal
statutes in connection with a residential mortgage loan.
No. 1.
See ECF
Because the Complaint lacked sufficient factual detail to
support its claims against Wells Fargo, the court granted Well’s
Fargo’s motion to dismiss, giving Levy leave to file an Amended
Complaint no later than July 12, 2011.
See ECF No. 23.
Given Levy’s counsel’s history of filing what appear to
be “form” complaints, the court warned Levy’s counsel:
In filing any such Amended Complaint, Levy
may, through his counsel, reassert the claims
asserted in the original Complaint, but must
ensure that any such Amended Complaint meets
the required minimal pleading standards.
This means that, before simply reasserting
claims, counsel should examine the relevant
facts and tailor claims based on those facts.
Having been cautioned against filing
unwarranted claims, see Rey, 2011 WL 2160679,
*3, Levy’s counsel should ensure that no
unwarranted claims are asserted in any
Amended Complaint. If, for example, a claim
is barred by the relevant statute of
limitation, it should not be asserted. If
there is legal theory under which Wells Fargo
is liable for Option One’s alleged actions,
the facts supporting that theory should be
alleged. That is, Levy should not simply
repeat a conclusion that Wells Fargo is
liable as a successor or trustee. If there
is no legal justification for holding Wells
Fargo liable for another company’s conduct, a
claim against Wells Fargo should not be
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asserted. Finally, because the claims
asserted in various “form complaints” filed
by Horner on behalf of his clients have been
rejected numerous times, Levy should consider
whether it is appropriate to assert them in
this action at all. In reminding counsel
about his Rule 11 obligations, this court
expresses no inclination as to the validity
of any claim Levy may assert. The court is
not here prejudging Levy’s possible claims,
but merely requiring any Amended Complaint to
assert only potentially valid claims that
have some factual basis supporting them.
See ECF No. 23 at 7-8.
Levy did not timely file an Amended Complaint.
Instead, on July 14, 2011, Levy filed a Motion for Leave to File
an Amended Complaint.
See ECF No. 24.
Levy provided no reason
as to why he did not timely file his Amended Complaint, stating
only that an “administrative error” caused the July 12 deadline
to be missed.
See id.
Levy attached a proposed Amended
Complaint to his motion.
In that document, Levy says that he
received a loan from Option One Mortgage Corporation that was
brokered by Keauhou Mortgage.
See id. ¶¶ 12-15.
Most of the
allegations in the proposed Amended Complaint concern alleged
violations by Option One and Keauhou Mortgage of various duties
concerning that loan.
See ECF No. 24-2.
loan was sold to Wells Fargo.
Levy alleges that his
Id. ¶ 54.
The proposed Amended Complaint is quite lengthy,
containing 40 pages and 155 paragraphs of allegations, most of
which are against persons and entities not associated with
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Defendant Wells Fargo.
In fact, Wells Fargo is mentioned only in
paragraphs 9, 54, 57, and 73-79.
Id.
There is no allegation
that Wells Fargo assumed liability by contract or under law for
actions by others.
Successor liability of Wells Fargo is not
mentioned at all.
The sole Defendant in this action, Wells Fargo, is not
expressly charged with wrongdoing or liability in any count in
the proposed Amended Complaint.
See, e.g., ECF No. 24-2,
Proposed Count I, ¶ 87 (“the Broker [Keauhou Mortgage], Option
One and BAC/BOA are liable to Plaintiff”); Proposed Count II ¶ 90
(claiming that Keauhou Mortgage, Option One, and BAC/BOA
concealed information from Levy); Proposed Count III ¶ 100
(alleging that BAC/BOA has successor liability with respect to
Option One’s alleged breach of fiduciary duties); Proposed Count
IV, ¶¶ 104-05 (alleging that Option One and BAC/BOA have been
unjustly enriched); Count V, ¶ 111 (alleging that Option One is
liable for a “mutual mistake”); Count VI, ¶ 117-18 (alleging that
Option One committed an unfair and deceptive trade practice in
violation of state law for which BAC and BOA have successor
liability) and ¶ 117(h) (alleging that BAC and BOA have successor
liability with respect to Truth-in-Lending Act violations); Count
VII, ¶ 126 (alleging that Keauhou Mortgage, Option One, and
BAC/BOA breached a contract); Count VII (alleging that Option One
caused Levy emotional distress for which BAC and BOA are liable);
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Count IX, ¶¶
141, 143 (alleging that Option One violated the
Gramm-Leach-Bliley Act and that BAC and BOA are liable for those
violations); and Count X, ¶ 149 (alleging that BAC has no right
to, title to, or interest in Levy’s property).
Instead, Counts I
to X of the proposed Amended Complaint appear to be asserted
against Option One, Keauhou Mortgage, and another bank (or one of
its related companies or loan servicers).
Because Levy did not timely file an Amended Complaint,
and because the proposed Amended Complaint fails to assert a
viable claim against Wells Fargo, the court denies Levy’s motion
for leave to file his proposed Amended Complaint.
III.
ANALYSIS.
When the court dismissed Levy’s original Complaint, the
court granted him leave to file an Amended Complaint no later
than July 12, 2011.
Complaint.
Levy did not timely file such an Amended
Instead, two days later, on July 14, 2011, Levy filed
the present motion to file a proposed Amended Complaint.
No. 24.
See ECF
Levy’s counsel gave the same excuse he has given to
justify other untimely filings--“administrative error.”
In
Casino v. Bank of America, 2011 WL 2619500 (D. Haw. July 1,
2011), this judge explained to Levy’s counsel that
“administrative error,” without more, was insufficient to justify
the filing of a late opposition.
The order in Casino was issued
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less than two weeks before Levy filed the present motion and
appears to have been ignored by Levy’s counsel.
In Rey v. Countrywide Home Loans, Inc., Civ. No. 1100142 JMS/KSC, Levy’s counsel similarly claimed that
“administrative error” had caused a failure to timely file an
amended complaint by June 27, 2011.
Levy’s counsel submitted his
own declaration in connection with a June 29, 2011, motion to
excuse the untimeliness in that case, stating that his office
“hired an additional experienced paralegal to ensure this type of
oversight does not happen again.”
See Rey, Civ. No. 11-00142
JMS/KSC, ECF No. 25-1, ¶ 7.
Levy’s counsel has missed deadlines in many other
recent cases.
For example, on March 22, 2011, in Enriquez v.
Aurora Loan Services, LLC., Civ. No. 10-00281 SOM/KSC, Levy’s
counsel sought an extension of time to submit a late opposition
to a motion to dismiss, saying that there had been “an oversight
in our office calendaring” and that counsel had “taken steps to
avoid such an oversight in the future.”
10-00281 SOM/KSC, ECF No. 24.
See Enriquez, Civ. No.
In Enriquez, this judge ultimately
issued an order to show cause on why Levy’s counsel should not be
sanctioned for repeatedly missing court deadlines, including
filing an opposition in that case only 5 calendar days before the
scheduled hearing, rather than the usual 21 days.
32.
Id., ECF No.
The court noted in the order to show cause that Levy’s
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counsel had filed late oppositions in Kapahu v. BAC Home Loans
Servicing, LP, Civ. No. 10-00097 JMS/BMK, and Santiago v. Bismark
Mortgage Company, Civ. No. 10-467 SOM/KSC.
Levy’s counsel paid
the sanctions in Enriquez on April 13, 2011, instead of
challenging the order to show cause.
Id., ECF No. 33.
Levy’s counsel’s significant history of flouting court
deadlines would on its own be sufficient to deny Levy’s motion to
file an untimely Amended Complaint.
More importantly, however,
the proposed Amended Complaint fails to assert claims against the
sole named Defendant, Wells Fargo.
The ten counts asserted in
the Complaint claim that Keauhou Mortgage, Option One, and/or
BAC/BOA are liable to Levy, but none of those entities is named
as a Defendant.
Wells Fargo is the only named Defendant in the proposed
Amended Complaint.
But as in the original Complaint, the
allegations against Wells Fargo in the proposed Amended Complaint
are too sparse to satisfy the minimal pleading standards set
forth in Bell Atlantic Corporation v. Twombly, 550 U.S. 544, 555
(2007), and Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009).
In
fact, the proposed Amended Complaint does not indicate why Wells
Fargo should be held liable at all.
In dismissing the original
Complaint, this court reminded Levy’s counsel of his Rule 11
obligations.
That is, the court reminded Levy’s counsel that, if
an Amended Complaint was asserted against Wells Fargo, the
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Amended Complaint should contain factual allegations supporting
the claims against Wells Fargo.
The proposed Amended Complaint
did not contain such allegations.
In paragraph 9, the proposed
Amended Complaint alleges that Wells Fargo is a New York
corporation that is doing business in Hawaii.
In paragraph 54,
it alleges that Levy’s loan was sold to Wells Fargo.
In
paragraph 57, the proposed Amended Complaint alleges that Wells
Fargo may have taken an interest in Levy’s loan with knowledge of
Option One’s alleged bad acts, but nowhere does Levy allege that
such knowledge automatically makes Wells Fargo liable for Option
One’s alleged bad acts.
In paragraphs 73 to 75, Levy alleges
that Wells Fargo improperly issued a notice of intent to
foreclose.
In paragraphs 77 to 79, Levy alleges that Wells Fargo
knew or should have known about Option One’s alleged bad acts and
that Wells Fargo agreed to abide by the conditions set forth in
the Troubled Asset Relief Program.
Again, Levy does not allege
that Wells Fargo’s alleged knowledge automatically places Wells
Fargo in Option One’s shoes.
Levy falls short of alleging facts
supporting a claim upon which relief can be granted, especially
because none of the claims asserted in the proposed Amended
Complaint is actually asserted against Wells Fargo.
As the proposed Amended Complaint would be subject to
dismissal under Rule 12(b)(6) of the Federal Rules of Civil
Procedure, the proposed amendment would be futile.
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Accordingly,
the court denies Levy’s motion to file his proposed Amended
Complaint.
See Flowers v. First Hawaiian Bank, 295 F.3d 966, 976
(9th Cir. 2002) (“A district court does not abuse its discretion
in denying leave to amend where amendment would be futile.”).
IV.
CONCLUSION.
The court denies Levy’s motion for leave to file his
Amended Complaint.
However, to avoid prejudicing Levy for his
counsel’s “administrative error,” the court gives Levy leave to
file another motion to amend his complaint no later than August
29, 2011.
Any proposed Amended Complaint must be attached to
such a motion.
If Levy fails to file such a motion, judgment
will automatically be entered in favor of Wells Fargo.
If Levy
chooses to file an Amended Complaint, he should comply with the
warnings given in this court’s June 22, 2011, order.
That is, if
Levy chooses to pursue claims against Wells Fargo, the proposed
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Amended Complaint should contain allegations that support claims
against Wells Fargo.
Any proposed Amended Complaint should not
be a regurgitation of a “form complaint.”
IT IS SO ORDERED.
DATED: Honolulu, Hawaii, August 22, 2011.
/s/ Susan Oki Mollway
Susan Oki Mollway
Chief United States District Judge
Levy v. Wells Fargo, et al., Civil No. 11-00159 SOM/KSC; ORDER DENYING MOTION FOR
LEAVE TO FILE AMENDED COMPLAINT
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