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Lyles v. America's Servicing Co.

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA


June 29, 2010

ALPHONSE W. LYLES, PLAINTIFF,
v.
AMERICA'S SERVICING COMPANY, NDEX WEST LLC, AND DOES 1-50 DEFENDANTS.

The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge

ORDER

Presently before the Court is Plaintiff's Ex Parte Application for Temporary Restraining Order and Preliminary Injunction ("Application") pursuant to Federal Rule of Civil Procedure 65(b). Plaintiff Alphonse W. Lyles ("Plaintiff") seeks to enjoin Defendants America's Servicing Company and NDEX West, LLC ("Defendants") from conducting a trustee sale of his home, which is currently scheduled for 9:30 a.m. on June 30, 2010.

Issuance of a temporary restraining order, as a form of preliminary injunctive relief, is an extraordinary remedy, and Plaintiffs have the burden of proving the propriety of such a remedy by clear and convincing evidence. See Mazurek v. Armstrong, 520 U.S. 968, 972 (1997); Granny Goose Foods, Inc. v. Teamsters, 415 U.S. 423, 442 (1974). Certain prerequisites must be satisfied prior to issuance of a temporary restraining order ("TRO"). See Granny Goose Foods, Inc. v. Brotherhood of Teamsters & Auto Truck Drivers, 415 U.S. 423, 439 (1974) (stating that the purpose of a TRO is "preserving the status quo and preventing irreparable harm just so long as is necessary to hold a hearing [on the preliminary injunction application], and no longer"). In general, the showing required for a temporary restraining order is the same as that required for a preliminary injunction. Stuhlbarg Int'l Sales Co., Inc. v. John D. Brush & Co., Inc., 240 F.3d 832, 839 (9th Cir. 2001). Following the Supreme Court's decision in Winter v. Natural Resources Defense Council, 129 S.Ct. 365 (2008), the party requesting preliminary injunctive relief must show 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." Stormans, Inc. v. Selecky, 586 F.3d 1109, 1127 (9th Cir. 2009) (quoting Winter, 129 S.Ct. at 374; see also American Trucking Assocs. Inc. v. City of Los Angeles, 559 F.3d 1046, 1052 ("To the extent that our cases have suggested a lesser standard [than that required for injunctive relief by Winter], they are no longer controlling, or even viable.").

The propriety of a temporary restraining order, in particular, hinges on a significant threat of irreparable injury (Simula, Inc. Autoliv, Inc., 175 F.3d 716, 725 (9th Cir. 1999)) that must be imminent in nature. Caribbean Marine Serv. Co. v. Baldridge, 844 F.2d 668, 674 (9th Cir. 1988).

The Court has reviewed Plaintiff's Ex Parte Application for TRO and finds that the balance of equities sufficiently tips in the favor of Plaintiff such that the issuance of a TRO is warranted.

Pursuant to California Civil Code § 2924(a), a trustee, mortgagee, or beneficiary may not exercise the power of sale until a Notice of Default has been recorded not less than three months prior to the date of foreclosure. See Cal. Civ. Code § 2924(a). The California Court of Appeal has held that while Civil Code §§ 2924-2924h, inclusive, do not require personal notice by a trustor of a notice of default or notice of sale, they do mandate certain procedural requirements reasonably calculated to inform those who may be affected by a foreclosure sale that a default has occurred and a foreclosure sale is imminent. See Knapp v. Doherty, 20 Cal. Rptr. 3d 1, 10 (Ct. App. 2004); Lupertino v. Carbahal, 111 Cal. Rptr. 112, 115 (Ct. App. 1973).

Such procedural requirements apparently have not been met here. Plaintiff has alleged that not only was he not informed of a Notice of Default three months prior to date of foreclosure, but that Notice of Trustee Sale was not publicly posted or provided to Plaintiff until sixteen days prior, in violation of the twenty-day mandate of California Civil Code § 2924(f).

Plaintiff has indicated that he contacted Defendants via telephone and facsimile regarding postponement of the sale and his intention to seek a TRO. Defendants refused to postpone the sale and, to date, have failed to rebut or oppose the allegation of deficient notices.

Defendants are statutorily obligated to follow a strict procedural standard in conducting foreclosure on a home. This Court will not institute a rule which allows that process to be shortchanged, thus robbing the mortgagor of an appreciable opportunity to cure default on his loan and prevent the irreparable harm of the loss of his home. In light of Defendants' failure file any opposition to the allegations brought against it by Plaintiff, the Court must protect the status quo until such time as the allegations raised by Plaintiff can be determined to be true or not true.

Accordingly, to preserve the status quo until hearing on Plaintiff's Motion for Preliminary Injunction can be had, Plaintiff's Application for Temporary Restraining Order is hereby GRANTED. The sale date of June 30, 2010 is stayed for the property of 4134 Sea Drift Way, Sacramento, CA 95823. No bond is required as Plaintiff's home currently serves as security.

In granting Plaintiff's Application for a Temporary Restraining Order, the Court makes no ruling on the merits of the Plaintiff's underlying claim and/or the likelihood of the issuance of a Preliminary Injunction.

Hearing on Plaintiff's Motion for Preliminary Injunction is hereby scheduled for 4:00 p.m. on Tuesday, July 13, 2010, in Courtroom 7 before Judge Morrison C. England, Jr. Any Opposition to Plaintiff's Motion for Preliminary Injunction must be filed by 4:00 p.m., July 7, 2010. Any Reply to Defendants' Opposition must be filed by 4:00 p.m., July 9, 2010.

IT IS SO ORDERED.

20100629

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