The opinion of the court was delivered by: Hon. Jeffrey T. Miller United States District Judge
ORDER GRANTING MOTION TO DISMISS THIRD AMENDED COMPLAINT; GRANTING LEAVE TO AMEND; STRIKING DOCKET NO. 40
Defendants Deutsche Bank National Trust Company ("Deutsche Bank"), trustee for New Century, and Chase Home Finance LLC ("Chase") move to dismiss Plaintiffs Third Amended Complaint ("TAC"). In apparent opposition to the motion, Plaintiffs filed a document entitled "Request for Judicial Notice in Support of Opposition." (Docket No. 37). The court has not received any other document from Plaintiffs in opposition to the motion. Pursuant to Local Rule 7.1(d)(1), the court finds this matter appropriate for decision without oral argument. For the reasons set forth below, the motion to dismiss is granted with 20 days leave to amend from the date of entry of this order. The court also instructs the Court Clerk to strike Docket No. 40 from the Court Docket.
Plaintiff Josephine Cleveland commenced this action on May 1, 2008 alleging that Defendants violated the Truth in Lending Act ("TILA"). The TAC, filed on August 28, 2008 alleges eight claims for violation of TILA, injunctive relief, statutory damages, fraud, accounting, cancellation of instruments, quiet title, and declaratory relief.
On October 22, 2006 Plaintiff, in her name only, obtained a loan in the amount of $547,000 from New Century. (TAC ¶12: RJN Exh. 1)*fn1. The Deed of Trust ("DOT") was assigned to Deutsche Bank on September 25, 2007. (RJN Exh. 2). On August 29, 2007 a second Notice of Default ("NOD") was recorded. At the time of recording the second NOD Plaintiff was $29,130.36 in arrears. (RJN Exh. 4). On January 18, 2008 a Notice of Trustee's Sale was recorded and the property sold to Deutsche Bank at a Trustee's sale on February 19, 2008. (TAC ¶19). Deutsche Bank subsequently brought an unlawful detainer action in state court and the eviction was completed on May 7, 2008. Plaintiffs have subsequently regained possession of the home. (TAC ¶19).
Federal Rule of Civil Procedure 12(b)(6) dismissal is proper only in "extraordinary" cases. United States v. Redwood City, 640 F.2d 963, 966 (9th Cir. 1981). Courts should grant 12(b)(6) relief only where a plaintiff's complaint lacks a "cognizable legal theory" or sufficient facts to support a cognizable legal theory. Balistreri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1990). Courts should dismiss a complaint for failure to state a claim when the factual allegations are insufficient "to raise a right to relief above the speculative level." Bell Atlantic Corp v. Twombly, __550 U.S. __, 127 S.Ct. 1955 (2007) (the complaint's allegations must "plausibly suggest" that the pleader is entitled to relief). The defect must appear on the face of the complaint itself. Thus, courts may not consider extraneous material in testing its legal adequacy. Levine v. Diamanthuset, Inc., 950 F.2d 1478, 1482 (9th Cir. 1991). The courts may, however, consider material properly submitted as part of the complaint. Hal Roach Studios, Inc. v. Richard Feiner and Co., 896 F.2d 1542, 1555 n.19 (9th Cir. 1989).
Finally, courts must construe the complaint in the light most favorable to the plaintiff. Concha v. London, 62 F.3d 1493, 1500 (9th Cir. 1995), cert. dismissed, 116 S.Ct. 1710 (1996). Accordingly, courts must accept as true all material allegations in the complaint, as well as reasonable inferences to be drawn from them. Holden v. Hagopian, 978 F.2d 1115, 1118 (9th Cir. 1992). However, conclusory allegations of law and unwarranted inferences are insufficient to defeat a Rule 12(b)(6) motion. In Re Syntex Corp. Sec. Litig., 95 F.3d 922, 926 (9th Cir. 1996).
Plaintiff Jay Cleveland Lacks Standing
Defendants move to dismiss Jay Cleveland on the ground that he lacks standing to assert any claim because he was not a borrower in connection with the loan. The real party in interest requirements of Federal Rule of Civil Procedure 17 require that an action be prosecuted in the name of the real party in interest. "Generally, the person possessing the right sued upon by reason of the substantive law is the real party in interest. It follows that someone who is not a party to [a] contract has no standing to enforce the contract or to recover extra-contract damages for wrongful withholding of benefits to the contracting party." Gantman v. United Pacific Ins. Co. 232 Cal.App.3d 1560, 1566 (1991). Here, the borrower to the loan was "Josephine Cleveland, a married woman as her sole and separate property." (RJN, Exh. 1). Since it appears that Jay Cleveland does not possess any interest in the property, he is not a proper party to this action.
The court grants the motion to dismiss Jay Cleveland as a party without prejudice and with leave to amend. In any amended complaint, Plaintiffs are instructed to allege, consistent with Rule 11, whether Jay Cleveland possesses any ...