Wolfson v. Bank of America National Association et al

Filing 35

ORDER granting 12 Motion to Dismiss for Failure to State a Claim, granting 14 Motion to Dismiss, denying 22 Motion to Strike, granting 23 Motion for Extension of Time, and granting 30 Motion for Extension of Time. Case will be dismissed without further order of the Court if no amended complaint filed by 6/22/2018. Signed by Judge Benjamin H. Settle. (MGC)

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1 2 3 4 5 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT TACOMA 6 7 8 9 10 11 JEREMY WOLFSON, CASE NO. C17-6064 BHS Plaintiff, v. BANK OF AMERICA NATIONAL ASSOCIATION, et al., Defendants. 12 13 14 15 16 17 18 19 20 ORDER GRANTING DEFENDANTS’ MOTIONS TO DISMISS, GRANTING PLAINTIFF LEAVE TO AMEND, GRANTING PLAINTIFF’S MOTIONS FOR EXTENSIONS OF TIME AND DENYING PLAINTIFF’S MOTION TO STRIKE This matter comes before the Court on Defendants Intercontinental Exchange, Inc., and Maroon Holding, LLC’s (“MERS Parent Corporations”) motion to dismiss (Dkt. 12), Defendants Bank of America National Association (“Bank of America”), Merscorp Holdings, Inc. (“Merscorp”), and Mortgage Electronic Registration Systems, Inc.’s (“MERS”) motion to dismiss (Dkt. 14), Plaintiff Jeremy Wolfson (“Wolfson”) motion to strike motion to dismiss (Dkt. 22), and Wolfson’s motions for extension of time (Dkts. 23, 30). The Court has considered the pleadings filed in support of and in opposition to the motions and the remainder of the file and hereby rules as follows: 21 22 ORDER - 1 1 2 I. PROCEDURAL HISTORY On December 21, 2017, Wolfson filed a complaint against MERS Parent 3 Corporations, Bank of America, Merscorp, and MERS asserting causes of action for quiet 4 title, violations of the Federal Debt Collection Practices Act (“FDCPA”), defamation, 5 declaratory judgment, cancellation of instrument, replevin, breach of the implied duty of 6 good faith and fair dealing, an accounting, violations of Washington Deed of Trusts Act 7 (“DTA”), and violations of Washington Consumer Protection Act (“CPA”). Dkt. 1. 8 On February 20, 2018, MERS Parent Corporations filed a motion to dismiss. Dkt. 9 12. On February 28, 2018, Bank of America, Merscorp, and MERS (“Loan Defendants”) 10 filed a motion to dismiss. Dkt. 14. On April 3, 2018, the Court granted Wolfson’s 11 motion for extension of time, renoted the motions to dismiss for consideration on the 12 Court’s April 20, 2018 calendar, and informed Wolfson that the deadline for any 13 response is April 16, 2018. Dkt. 21. 14 On April 5, 2018, Wolfson filed a motion to strike the Loan Defendants’ motion to 15 dismiss because their counsel do not qualify as local counsel under the local rules of 16 procedure. Dkt. 22. On April 9, 2018, Wolfson filed a motion for extension of time to 17 reply to the Loan Defendants’ motion. Dkt. 23. On April 10 and 12, 2018, the Loan 18 Defendants responded to Wolfson’s motions. Dkt. 24, 25. On April 16, 2018, Wolfson 19 responded to the MERS Parent Corporations’ motion to dismiss. Dkt. 26. 20 On April 19, 2018, Wolfson filed a motion for an extension of time to respond to 21 the Loan Defendants’ motion to dismiss and responded to the motion. Dkts. 30, 31. On 22 April 20, 2018, MERS Parent Corporations replied. Dkt. 32. ORDER - 2 1 II. FACTUAL BACKGROUND 2 On January 10, 2007, Wolfson and Erin D. Huffman (“Huffman”) signed a note 3 (the “Note”) in the amount of $279,000.00 in favor of First Magnus Corporation (“First 4 Magnus”). In order to secure the Note, Wolfson and Huffman executed a deed of trust 5 (“Deed”) against the property located at 16208 132nd Avenue East, Puyallup, 6 Washington 98374 (the “Property”). Dkt. 12-2. The Deed named MERS as beneficiary 7 for First Magnus. Id. at 3. On or about June 21, 2013, MERS assigned its interest in the Deed to Bank of 8 9 10 America. Dkt. 12-3. On November 8, 2013, Huffman signed a Quitclaim Deed to Wolfson. Dkt. 15-3. The Quitclaim was recorded on November 20, 2013. Id. On March 30, 2017, Trustee Corps recorded a Notice of Trustee’s Sale (“NOTS”) 11 12 against the Property asserting that Wolfson was over 8 months behind on payments and 13 setting a trustee’s sale for the Property on August 4, 2017. Dkt. 15-4. On August 4, 2017, Wolfson filed a bankruptcy case seeking relief under Chapter 14 15 13. On September 20, 2017, the bankruptcy court dismissed his case for failure to 16 comply with orders. III. DISCUSSION 17 18 19 A. Wolfson’s Motions Wolfson has filed two motions for extensions of time and a motion to strike the 20 Loan Defendants’ motion to dismiss. Both of Wolfson’s motions for extensions of time 21 request additional time to respond to the Loan Defendants’ motion to dismiss. Dkts. 23, 22 30. The Loan Defendants opposed the first motion and failed to respond to the second ORDER - 3 1 motion. Dkt. 24. While it is true that Wolfson’s second motion is untimely, the Court 2 concludes that the Loan Defendants are not prejudiced by the late response because the 3 Court routinely grants plaintiffs proceeding pro se an opportunity to amend the complaint 4 before dismissing claims with prejudice. See Lucas v. Dep’t of Corr., 66 F.3d 245, 248 5 (9th Cir. 1995) (per curiam) (“Unless it is absolutely clear that no amendment can cure 6 the defect . . ., a pro se litigant is entitled to notice of the complaint’s deficiencies and an 7 opportunity to amend prior to dismissal of the action.”). As further explained below, 8 Wolfson is granted leave to amend, despite his untimely response. Regarding Wolfson’s motion to strike, it is without merit because the Loan 9 10 Defendants’ counsel are licensed to practice law in this Court. Counsel holds a 11 Washington state license and is admitted to represent clients in this district. Therefore, 12 the Court denies Wolfson’s motion. 13 B. 14 Motions to Dismiss Motions to dismiss brought under Rule 12(b)(6) of the Federal Rules of Civil 15 Procedure may be based on either the lack of a cognizable legal theory or the absence of 16 sufficient facts alleged under such a theory. Balistreri v. Pacifica Police Department, 17 901 F.2d 696, 699 (9th Cir. 1990). Material allegations are taken as admitted and the 18 complaint is construed in the plaintiff’s favor. Keniston v. Roberts, 717 F.2d 1295, 1301 19 (9th Cir. 1983). To survive a motion to dismiss, the complaint does not require detailed 20 factual allegations but must provide the grounds for entitlement to relief and not merely a 21 “formulaic recitation” of the elements of a cause of action. Bell Atlantic Corp. v. 22 ORDER - 4 1 Twombly, 127 S. Ct. 1955, 1965 (2007). Plaintiffs must allege “enough facts to state a 2 claim to relief that is plausible on its face.” Id. at 1974. 3 1. 4 MERS Parent Corporations move to dismiss the complaint arguing that Wolfson 5 has failed to provide sufficient allegations to establish that they are liable for the acts of 6 their subsidiary MERS. Dkt. 12 at 13–18. Wolfson responds that he included allegations 7 stating that both parents are responsible for the actions of MERS. Dkt. 26 at 2. Their 8 allegations, however, are unsupported conclusions. See, e.g., Dkt. 1, ¶ 40 (“Defendant 9 MAROON HOLDING, LLC., is a foreign Limited Liability Corporation and is the parent MERS Corporate Parents 10 company of Defendant MERSCORP HOLDINGS, INC., and is responsible for the acts 11 of Defendant MERS.”). Therefore, the Court grants MERS Parent Corporations’ motion 12 because Wolfson’s complaint fails to provide sufficient notice of the basis for his claims. 13 In the event the court finds that dismissal is warranted, the court should grant the 14 plaintiff leave to amend unless amendment would be futile. Eminence Capital, LLC v. 15 Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir.2003). In this case, it is not absolutely clear 16 that Wolfson could not alleged facts sufficient to pierce the corporate veil. Therefore, the 17 Court grants Wolfson leave to amend his theories of liability. 18 2. Loan Defendants 19 The Loan Defendants move to dismiss Wolfson’s claims for procedural reasons 20 and on the merits. Dkt. 14. First, Merscorp argues that Wolfson fails to include any 21 allegations that Merscorp is liable for any alleged wrongdoing. Wolfson responds that he 22 included an allegation that, properly understood, alleges that Merscorp is responsible for ORDER - 5 1 the actions of MERS because it is another parent company of MERS. Dkt. 31 at 2 (citing 2 Dkt. 1, ¶ 39). This argument fails for the same reason that Wolfson’s claims against 3 MERS Parent Corporations fail. Beyond the conclusory allegation, Wolfson fails to 4 provide any notice that the alleged parent is responsible for the actions of its subsidiary. 5 Therefore, the Court grants Merscorp’s motion to dismiss. Wolfson is granted leave to 6 amend because it is not absolutely clear that any amendment would be futile. Eminence, 7 316 F.3d at 1052. 8 Regarding Wolfson’s other claims, the Loan Defendants assert that the complaint 9 “does not meet the basic pleading requirements of FRCP 8.” Dkt. 14 at 2. The Court 10 agrees, and Wolfson’s arguments even conflict with allegations in his complaint. For 11 example, the Loan Defendants argue that Wolfson lacks standing to challenge the 12 assignment of the deed from MERS to Bank of America. Dkt. 14 at 6–7. In response, 13 Wolfson argues that he has standing because “he is at risk of paying the same debt twice 14 if the assignment stands . . . .” Dkt. 31 at 2. Wolfson, however, alleges that “[a]ny and 15 all loans encumbering the property have been paid or otherwise discharged.” Dkt. 1, ¶ 16 223. Moreover, none of Wolfson’s other claims or arguments fare any better. Wolfson’s 17 complaint is essentially a verbose collection of conflicting and conclusory allegations that 18 lack clarity. Before addressing each claim on the merits, Wolfson is ordered to clarify 19 and/or simplify the claims and provide actual, factual allegations to support each claim. 20 Accordingly, the Court grants the Loan Defendants’ motion to dismiss and grants 21 Wolfson leave to amend. 22 ORDER - 6 1 2 IV. ORDER Therefore, it is hereby ORDERED that MERS Parent Corporations’ motion to 3 dismiss (Dkt. 12) and the Loan Defendants’ motion to dismiss (Dkt. 14) are GRANTED, 4 Wolfson’s motion to strike motion to dismiss (Dkt. 22) is DENIED, Wolfson’s motions 5 for extension of time (Dkts. 23, 30) are GRANTED, and Wolfson is GRANTED leave 6 to amend. 7 Wolfson must file an amended complaint no later than June 22, 2018. Failure to 8 file an amended complaint or otherwise respond will result in dismissal of the action 9 without further order of the Court. 10 Dated this 31st day of May, 2018. 11 12 A BENJAMIN H. SETTLE United States District Judge 13 14 15 16 17 18 19 20 21 22 ORDER - 7

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