The opinion of the court was delivered by: Honorable Janis L. Sammartino United States District Judge
ORDER: DENYING PLAINTIFFS' MOTION FOR A TEMPORARY RESTRAINING ORDER (Doc. No. 3)
Presently before the Court is Plaintiffs' motion for a temporary restraining order. (Doc. No. 9.) The Court ordered Defendants to file responsive briefing by October 19, 2009, but none was received. However, since it is unclear whether Defendants were timely and properly informed of this motion, the Court believes that a finding of consent under Local Rule 7.1(e)(2) would be improper. Having considered the law and the arguments presented, Plaintiffs' motion is DENIED.
Temporary restraining orders are governed by the same standard applicable to preliminary injunctions. See New Motor Vehicle Bd. of Cal. v. Orrin W. Fox Co., 434 U.S. 1345, 1347 n.2 (1977) (Rehnquist, J.). "A plaintiff seeking a preliminary injunction must establish that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest." Winter v. Natural Res. Def. Council, Inc. (NRDC), - U.S. -, 129 S.Ct. 365, 374 (2008) (citing Munaf v. Geren, - U.S. -, 128 S.Ct. 2207, 2218--19 (2008)); see also Am. Trucking Ass'ns, Inc. v. City of Los Angeles, 559 F.3d 1046, 1052 (9th Cir. 2009). This is an "extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief." NRDC, 129 S.Ct. at 376. This "clear showing" requires Plaintiffs to show more than a mere "possibility" of irreparable harm, but instead they must "demonstrate that irreparable injury is likely in the absence of an injunction." Id. at 375 (emphasis in original); Am. Trucking Ass'ns, 559 F.3d at 1052.
The Court believes that Plaintiffs have not made an adequate showing that (1) they are likely to succeed on the merits, or (2) that they are likely to suffer "irreparable harm."*fn1 Without such necessary showings, a temporary restraining order is inappropriate. NRDC, 129 S.Ct. at 375--76.
I. Likelihood of Success on the Merits
Plaintiffs set forth five different legal bases for relief in their complaint and motion. (See Memo. ISO Motion at 6--7; Compl. ¶¶ 25--51.) These legal bases differ in one respect; in the Complaint, Plaintiffs allege that Defendants engaged in an unfair trade practice while in their motion the allege a violation of California Civil Code § 2923.6. Since Plaintiffs do not argue the unfair trade practices claim in their motion, it is not considered here.
Plaintiffs first allege violations of the Truth In Lending Act ("TILA"), 15 U.S.C. §§ 1601, et seq., and Home Ownership and Equity Protection Act ("HOEPA"), 15 U.S.C. §§ 1602, et seq. These claims, however, appear to be time barred. TILA and HOEPA share a statute of limitations. See 15 U.S.C. § 1640; In re Cmty. Bank N. Va., 418 F.3d 277, 304--05 (3rd Cir. 2005). Typically, a damages claim under either act must be brought into court within one year of the loan's execution. Id. § 1640(e). The "right of rescission . . . expire[s] three years after the date of consummation of the transaction or upon the sale of the property, whichever occurs first." 15 U.S.C. § 1635(f). In this case, Plaintiffs allege that they "obtained a loan on their residence on or about September 1, 2005." (Memo. ISO Motion at 3.) Since that occurred well outside both the one and three year time limits, the Court cannot find that Plaintiffs are likely to succeed on these claims.
Next, Plaintiffs allege violations of the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. § 2601, et seq. They are similarly unlikely to succeed on this claim. RESPA has a three year statute of limitations for claims brought under 12 U.S. C. § 2605 and a one year statute of limitations for claims brought under 12 U.S.C. §§ 2607 & 2608. Even applying the three year limitation period, Plaintiffs' claims appear to be barred since they executed their loan more than four years prior to the filing of this action. Thus, Plaintiffs are not likely to succeed on their RESPA claims.
Third, Plaintiffs allege that Defendants violated California Civil Code § 2923.6. (Memo. ISO Motion at 7.) According to Plaintiffs, Defendants would breach this section by foreclosing and not modifying their loan. (Id.) Plaintiffs are incorrect. Section 2923.6 states that "any duty servicers may have to maximize net present value under their pooling and servicing agreements is owed to all parties in a loan pool, not to any particular parties." Cal Civ. Code § 2923.6(a). Since Plaintiffs are not "parties in a loan pool,"*fn2 the Defendants do not owe them a duty under this statutory section. Without standing to enforce this duty, Plaintiffs are unlikely to succeed on a 2923.6 claim.
Finally, Plaintiffs allege that Defendants are in breach of a contract for loan modification. (Memo. ISO Motion at 7.) According to Plaintiffs, they entered into a contract with Defendant Ocwen changing the terms of their mortgage and that Defendant breached by nonetheless foreclosing. (Id.) Although it appears that Plaintiffs may have entered into a loan modification contract, it is not likely that they will succeed on the merits of their breach of contract claim.
Plaintiffs have provided the Court with a copy of the "Loan Modification Agreement." (Memo. ISO Motion, Ex. E ("Agreement") at 46--47.*fn3 ) Having reviewed the agreement, there are a number of provisions which Plaintiffs do not address that appear to preserve Defendant Ocwen's right to foreclose. For example, paragraph 9(b) states that none of Plaintiffs' "obligations or liabilities under your Note and Mortgage will be diminished or released by any provisions hereof, nor will this Agreement in any way impair, diminish or affect any of Ocwen's rights under or remedies on your Note and Mortgage." It also states that the Agreement is neither "a satisfaction or release in whole or in part of your Note and Mortgage" and that "[d]uring the Trial period, your loan will continue to be delinquent." (Id. ¶¶ 9(d), 9(f).) Finally, "[i]n the event that a foreclosure is pending, the foreclosure action will not be dismissed." (Id. ¶ 9(e).)
Plaintiffs' pleadings and evidence make clear that they were willfully in default prior to their foreclosure. (Compl. ¶ 15; Sandoval Decl. ISO Motion) Although it may be that Defendant Ocwen's revocation of the loan modification offer was wrongful, the pleadings are inadequate to show that Plaintiffs are likely to prevail on this claim. Nor does the agreement clearly make foreclosure wrongful, as Defendant Ocwen merely agreed to "take reasonable action to place [the foreclosure] on hold pending your completion of the trial period." (Agreement ¶ 9(e).) As such, although it is possible ...