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Fullmer v. JPMorgan Chase Bank

January 5, 2010

SHAUNN A. FULLMER, PLAINTIFF,
v.
JPMORGAN CHASE BANK, NA, ETC., ET AL., DEFENDANTS.



ORDER

All parties have consented to proceed before the undersigned for all purposes. See 28 U.S.C. § 636(c). The following motions came on for hearing December 10, 2009: defendant JPMorgan Chase Bank NA's motion to dismiss, defendant OneWest Bank's motion to strike, and motion to dismiss. Kimberlee A. Rode appeared for plaintiff. S. Christopher Yoo appeared telephonically for defendant JPMorgan Chase Bank, N.A. Joshua R. Mandell appeared telephonically for defendant OneWest Bank. Upon review of the motions and the documents in support and opposition, upon hearing the arguments of counsel and good cause appearing therefor, THE COURT FINDS AS FOLLOWS:

Plaintiff alleges defendants violated federal and state laws in the execution and servicing of a mortgage agreement.

Background

Plaintiff and his wife obtained a mortgage loan for $500,000.00 secured by a deed of trust against real estate recorded on March 3, 2006. The deed of trust identifies 1st National Lending Services as the lender, Mortgage Electronic Registration Systems, Inc. as the nominee beneficiary, and Greenhead Investments, Inc. as the trustee, with plaintiff and his wife as borrowers.

Plaintiff and his wife obtained a second mortgage loan in the sum of $45,000.00 on or about March 3, 2006. That deed of trust identifies 1st National as the lender, Greenhead as the trustee and plaintiff and his wife as the borrowers.

Notice of default was recorded on June 23, 2009.*fn1

Plaintiff believes that defendants JPMorgan Chase Bank, N.A. (hereafter "JP Morgan") and OneWest Bank ("OneWest") are servicing agents for their existing mortgage, but also allege defendants "could be a servicing agent, lender, or have an interest in the subject loan, . . . and are intentionally keeping their true role a mystery in light of plaintiff's request for said information in a Qualified Written Request." (Complt. at ¶¶ 45, 85.)

On January 14, 2009, plaintiff, relying on the fact he and his wife allegedly did not receive accurate Notices of Right to Cancel, sent a letter to Washington Mutual Bank, IndyMac Federal Bank, and 1st National Lending Services, asserting, inter alia, that if defendants did not agree to various loan modifications, plaintiff intended to rescind the loan. Plaintiff also requested that defendants inform plaintiff of defendant's relationship to the loan and to identify the owner of plaintiffs' obligation. Finally, plaintiff directed defendants to stop trying to collect on the loan and to cease all further collection communications. Plaintiff alleges defendants failed to respond to the letter or to comply with its terms.

On April 17, 2009, plaintiff filed the instant action alleging that defendants

1) violated the Truth in Lending Act ("TILA"), 15 U.S.C. 1601 et seq., by failing to provide two accurate copies of Notice of Right to Cancel and failing to timely respond to plaintiffs' rescission letter; 2) violated the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. § 2601 et seq. by likewise failing to respond to the same correspondence; 3) violated the Rosenthal Fair Debt Collection Practices Act ("RFDCPA"), California Civil Code § 1788 et seq., by continuing to try to collect on the relevant loan after receiving plaintiff's letter; 4) violated California's Unfair Competition Law ("UCL"), California Business & Professions Code § 17200 et seq.; 5) breached the Implied Covenant of Good Faith and Fair Dealing; 6) are pursuing wrongful foreclosure; 7) have recorded documents impairing plaintiff's title, constituting slander of title; and 8) have taken actions and inaction that have impaired plaintiff's credit.

STANDARDS

The purpose of a motion to dismiss pursuant to Rule 12(b)(6) is to test the legal sufficiency of the complaint. N. Star Int'l v. Ariz. Corp. Comm'n, 720 F.2d 578, 581 (9th Cir. 1983). "Dismissal can be based on the lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990). A plaintiff is required to allege "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 1974 (2007). Thus, a defendant's Rule 12(b)(6) motion challenges the court's ability to grant any relief on the plaintiff's claims, even if the plaintiff's allegations are true.

In determining whether a complaint states a claim on which relief may be granted, the court accepts as true the allegations in the complaint and construes the allegations in the light most favorable to the plaintiff. Hishon v. King & Spalding, 467 U.S. 69, 73 (1984); Love v. United States, 915 F.2d 1242, 1245 (9th Cir. 1989).

The court is permitted to consider material properly submitted as part of the complaint, documents not physically attached to the complaint if their authenticity is not contested and the complaint necessarily relies on them, and matters of public record. Lee v. City of Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001). Matters of public record include pleadings and other papers filed with a court. Mack v. South Bay Beer Distributors, 798 F.2d 1279, 1282 (9th Cir. 1986). The court need not accept as true conclusory allegations, unreasonable inferences, or unwarranted deductions of fact. Western Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981).

Defendants request the court take judicial notice of the following documents recorded by the El Dorado County Recorder:

1. Plaintiff and his wife acquired title to 4048 Monte Verde Drive, El Dorado Hills, CA, by grant deed recorded on March 3, 2006.

2. Plaintiff and his wife obtained a mortgage loan for $500,000.00 secured by a deed of trust against said real estate recorded on March 3, 2006. The deed of trust identifies 1st National Lending Services as the lender, Mortgage Electronic Registration Systems, Inc. as the nominee beneficiary, and Greenhead Investments, Inc. as the trustee, with plaintiff and his wife as borrowers.

3. Plaintiff and his wife obtained a second mortgage loan in the sum of $45,000.00 on or about March 3, 2006. That deed of trust identifies 1st National as the lender, Greenhead as the trustee and plaintiff and his wife as the borrowers.

4. Notice of default was recorded on June 23, 2009.*fn2 The notice of default was signed by Clayton Goff for NDEx West, LLC as Agent for Beneficiary, and directed plaintiff to contact OneWest Bank, FSB, c/o NDEx West, LLC, 15000 Surveyor Boulevard, Suite 500, Addison, Texas 75001-9813 to "find out the amount [he] must pay, or to arrange for payment to stop the foreclosure, or if [the] property is in foreclosure for any other reason." Id.

Defendants' request for judicial notice will be granted.

ANALYSIS

I. TILA

Plaintiff contends that, under TILA, he is entitled to rescind the home loans as a result of 1st National's original notice violations.

TILA's purpose is to "assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit, and to protect the consumer against inaccurate and unfair credit billing and credit card practices." 15 U.S.C. § 1601(a). TILA and its regulations, issued by the Federal Reserve System, 12 C.F.R. §§ 226.1-.29 ("Reg Z"), contain detailed ...


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