Gillespie et al v. Countrywide Bank FSB et al
Filing
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ORDER granting 45 Motion to Dismiss. Signed by Judge James C. Mahan on 08/19/11. Civil case terminated. (Copies have been distributed pursuant to the NEF - LG)
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UNITED STATES DISTRICT COURT
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DISTRICT OF NEVADA
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STEVEN R. GILLESPIE and
KATHERINE A. GILLESPIE,
3:09-CV-556 JCM (VPC)
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Plaintiff,
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v.
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COUNTRYWIDE BANK FSB, et al.,
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Defendants.
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ORDER
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Presently before the court is defendants BAC Home Loans Servicing, fka Countywide Home
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Loans Servicing, Countrywide Bank FSB, Countrywide Home Loans, Inc., Countrywide Financial
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Corp., Lisa Klimenko, and Merscorp’s, (hereinafter “defendants”) motion to dismiss. (Doc. # 45).
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Plaintiffs Steven R. Gillespie and Katherine A. Gillespie filed an opposition. (Doc. # 46). Defendants
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filed a reply. (Doc. # 47).
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Plaintiffs’ complaint (doc. # 45-1 ex.1) stems from the alleged “predatory lending” scheme
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conducted by the defendants. According to the complaint, the subject property was purchased by the
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plaintiffs using a loan from Countrywide Home Loans, Inc. in May 2007. Neither party disputes that
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the plaintiffs are in default. The following claims for relief against the defendants are before this
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court: (1) injunctive relief, (2) declaratory relief, (3) violation of the Federal Fair Debt Collection
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Practice Act, (4) violation of unfair and deceptive trade practices statutes, (5) unfair lending under
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N.R.S. § 598D, (6) breach of the covenant of good faith, and (7) unjust enrichment. (Doc. # 45).
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James C. Mahan
U.S. District Judge
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Motion to Dismiss
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Defendants’ present motion to dismiss (doc. # 45) asserts that the complaint should be
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dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim for which
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relief can be granted.
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Under Federal Rule of Civil Procedure 12(b)(6), dismissal is proper when a complaint fails
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to state a claim upon which relief can be granted. In order for the plaintiffs to survive a 12(b)(6)
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motion, they must “provide the grounds for [] entitlement to relief [which] requires more than labels
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and conclusions. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 547 (2007). Under rule 8(a)(2), a
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complaint must contain a “short and plain statement of the claim showing that the pleader is entitled
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to relief,” and must be more than “an unadorned, the defendant-unlawfully-harmed-me accusation.”
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See Fed. R. Civ. P. 8(a)(2); Ashcroft v. Iqbal, 129 S.Ct 1937, 173 L.Ed.2d 868 (2009), quoting
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Twombly at 555.
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Further, defendants assert that plaintiffs fail to present the court with points and authorities
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in opposition to several arguments. Nevada Local Rule 7-2 provides in pertinent part that “[t]he
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failure of an opposing party to file points and authorities in response to any motion shall constitute
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a consent to the granting of the motion.” However, failure to file an opposition to a motion to
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dismiss is not cause for automatic dismissal. See Ghazali v. Moran, 46 F.3d 52, 53 (9th Cir. 1995).
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Before dismissing the action, the district court is required to weigh (1) the public’s interest in
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expeditious resolution; (2) the court’s need to manage its docket; (3) the risk of prejudice; (4) the
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public policy favoring disposition of cases on their merits; and (5) the availability of less drastic
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sanctions.” Id. (quoting Henderson v. Duncan, 779 F.2d 1421, 1423 (9th Cir.1986)).
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Here, those factors weigh in favor of dismissal. The public’s interest in expeditious
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resolution of litigation, the court’s need to manage its docket, and the lack of prejudice weigh in
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favor of granting the motion to dismiss. Additionally, the present motion to dismiss has merit.
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A. Count III for Violation of the Federal Fair Debt Collection Practices Act
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The Fair Debt Collection Practices Act (FDCPA) provides that activities undertaken in
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connection with a nonjudicial foreclosure do not constitute debt collection under the FDCPA. See
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James C. Mahan
U.S. District Judge
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Diessner v. Mortgage Elec. Reg. Sys., Inc., 618 F. Supp. 2d 1184, 1188-89. Plaintiffs’ claim against
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defendants must be dismissed because the defendants have undertaken activities connected with the
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nonjudicial foreclosure sale of the property at issue, and they are not considered “debt collectors”
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under the FDCPA.
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B. Count IV for Violation of Unfair and Deceptive Trade Practice Statute
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Plaintiffs contend that the defendants violated Nevada’s deceptive trade practice statutes
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N.R.S. § 598.0923(1) and (3). Plaintiffs have failed to file points and authorities in response to
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defendants’ arguments regarding N.R.S. § 598.0923(3). As discussed earlier, Nevada Local Rule 7-2
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states that the failure of an opposing party to file points and authorities in response to any motion
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may be deemed as consent to granting the motion. Additionally, the factors discussed above weigh
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in favor of dismissal and the present motion to dismiss has merit. Claims brought under N.R.S. §
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598.0923(3) only apply to goods or services. The foreclosure relates to real property, not goods or
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services, so dismissal is proper.
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Plaintiffs allege that defendants violated § 598.0923(1) because “defendants are not duly
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licensed as collection agencies or foreign collection agencies, and their attempted non-judicial
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foreclosure violates this statute.” (Doc. # 46). Defendants could not have violated subsection 1
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because a foreclosure trustee does not have to be a licensed debt collector in the state of Nevada.
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Martinez v. Bank of Am. Nat’l Ass’n, No. 3:10-cv-00287-RCJ-RAM, 2010 WL 4290921, at *6.
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Therefore, for the foregoing reasons, count IV is dismissed.
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C. Count V for Unfair Lending under N.R.S. 598D
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An action upon statute for penalty or forfeiture has a two-year statute of limitations, unless
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the statute provides otherwise. NRS § 11.190(4)(b). The statute at issue, NRS § 598D, qualifies as
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a statute for penalty and does not provide a contrary limitations period. Plaintiffs’ loan was issued
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in May of 2007, and plaintiffs filed the original complaint on August 25, 2009. (Doc. # 45-1 ex.1
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). Accordingly, the claim is time-barred and is dismissed against defendants. See, e.g., Freeto v.
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Litton Loan Serv. LP, 2010 WL 2730596 (D. Nev. 2010) (finding that where a loan was issued in
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2005, but the complaint was filed in 2009, the claim was time-barred).
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James C. Mahan
U.S. District Judge
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D. Count VI for Breach of the Covenant of Good Faith and Fair Dealing
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To state a claim of breach of the covenant of good faith and fair dealing against defendants,
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plaintiffs must allege: (1) plaintiffs and defendants were parties to an agreement; (2) the defendants
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owed a duty of good faith to the plaintiffs; (3) the defendants breached that duty by performing in
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a manner that was unfaithful to the purpose of the contract; and (4) the plaintiffs’ justified
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expectations were denied. Perry v. Jordan, 900 P.2d 335, 338 (Nev. 1995). In Nevada, an implied
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covenant of good faith and fair dealing exists in every contract, Consol Generator-Nevada v.
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Cummins Engine, 917 P.2d 1251, 1256 (Nev. 1998), and a plaintiff may assert a claim for its breach
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if the defendant deliberately contravenes the intention and spirit of the agreement. Morris v. Bank
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Am. Nev., 886 P.2d 454 (Nev. 1994).
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The plaintiffs allege that the defendants breached their duty of good faith because they
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“offered the plaintiffs consideration for a loan modification, told them that the foreclosure would be
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postponed and then invited them to have their denial reconsidered after defendants foreclosed on
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their home.” (Doc. # 46). These allegations relate to alleged negotiations to modify the underlying
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loan. However, the plaintiffs provided no information that confirms any existence of a loan
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modification agreement or contract between parties. See Perry v. Jordan, 900 P.2d 335.
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Plaintiffs also allege that defendants breached the duty of good faith and fair dealing by “not
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disclosing the use of future equity in the home as a basis to grant the qualification.” (Doc. # 46).
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These allegations relate to events that took place during the origination of the loan prior to any
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contractual agreement. Therefore, this claim also fails on the first prong of the four-part test.
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Accordingly, count VI is dismissed.
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E. Count XIV for Unjust Enrichment
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Unjust enrichment is a quasi-contract theory that allows the court to prevent “the unjust
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retention of money or property of another against fundamental principles of justice or equity and
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good conscience.” Asphalt Products Corp. v. All Star Ready Mix, Inc., 898 P.2d 699, 701 (Nev.
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1995). However, “an action for unjust enrichment is not available when there is an express, written
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contract, because no agreement can be implied when there is express agreement.” Leasepartners
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James C. Mahan
U.S. District Judge
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Corp. v. Robert L. Brooks Trust, 942 P.2d 182, 187 (Nev. 1997).
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Here, the plaintiffs’ loan documents created the express, written agreement upon which the
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plaintiffs base a majority of their claims. Accordingly, there can be no implied agreement where
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there is an express agreement. Thus, count XIV is dismissed as to all defendants. In addition,
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plaintiffs have failed to file points and authorities in response to defendants’ arguments. As discussed
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above, this failure may be deemed as consent to granting the motion. See Nevada Local Rule 7-2.
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Additionally, the above discussed Henderson factors weigh in favor of dismissal and the present
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motion to dismiss has merit. See Henderson v. Duncan, 779 F.2d at 1423. Thus, count XIV is
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dismissed.
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F. Count I and Count II for Injunctive Relief and Declaratory Relief
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Injunctive relief and declaratory relief are remedies and not causes of action. See Stock West,
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Inc. v. Confederated Tribes of Coville Reservations, 873 F.2d 1221, 1225 (9th Cir. 1989); See, e.g.,
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In re Wal-Mart Wage & Hour Employment Practices Litig., 490 F. Supp. 2d 1091, 1130 (D. Nev.
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2007). Further, as defendants’ motion to dismiss is granted in its entirety, plaintiffs are not entitled
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to such relief at this juncture. Thus, count I and count II are dismissed as to all defendants.
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Accordingly,
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IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that defendants’ motion to
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dismiss (doc. # 45) be, and the same hereby is, GRANTED.
IT IS THEREFORE ORDERED that the above captioned case be DISMISSED as to all
defendants.
DATED August 19, 2011.
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UNITED STATES DISTRICT JUDGE
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James C. Mahan
U.S. District Judge
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