Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Khan v. GMAC Mortgage

June 29, 2010

TAZIM KHAN AND JAIBUL NISHA, PLAINTIFF,
v.
GMAC MORTGAGE, LLC; MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., AS NOMINEE FOR GMAC MORTGAGE, LLC F/K/A GMAC MORTGAGE CORP., A LIMITED LIABILITY COMPANY; EXECUTIVE TRUSTEE SERVICES, LLC DBA ETS SERVICES, LLC AND; DOES 1 THROUGH 10, INCLUSIVE, DEFENDANTS.



The opinion of the court was delivered by: Garland E. Burrell, Jr. United States District Judge

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS AND DENYING DEFENDANTS' MOTION TO STRIKE

Defendants GMAC Mortgage, LLC; Mortgage Electronic Registration Systems, Inc.; and Executive Trustee Services, LLC dba ETS Services, LLC ("Defendants") move for dismissal of Plaintiffs' complaint under Federal Rule of Civil Procedure 12(b)(6), arguing Plaintiffs failed to allege sufficient facts to state viable claims. Defendants also move to strike Plaintiffs' punitive damages claim and request for attorneys' fees under Federal Rule of Civil Procedure 12(f). For the reasons stated below, Defendants' motion to dismiss is GRANTED AND DENIED IN PART and their motion to strike is DENIED.

Plaintiffs did not file an Opposition or Notice of Opposition in response to either motion as required by Local Rule 230(c).

Plaintiffs are cautioned that failing to comply with the Local Rules can subject them to sanctions. L.R. 110.

I. LEGAL STANDARD

A Rule 12(b)(6) dismissal motion tests the legal sufficiency of the claims alleged in the complaint. Novarro v. Black, 250 F.3d 729, 732 (9th Cir. 2001). A pleading must contain "a short and plain statement of the claim showing that the pleader is entitled to relief . . . ." Fed. R. Civ. P. 8(a)(2). The complaint must "give the defendant fair notice of what the [plaintiff's] claim is and the grounds upon which relief rests . . . ." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007).

Dismissal of a claim under Rule 12(b)(6) is appropriate only where the complaint either 1) lacks a cognizable legal theory, or 2) lacks factual allegations sufficient to support a cognizable legal theory. Balistreri v. Pacific Police Dept., 901 F.2d 696, 699 (9th Cir. 1988). To avoid dismissal, the plaintiff must allege "only enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 547.

In deciding a Rule 12(b)(6) motion, the material allegations of the complaint are accepted as true and all reasonable inferences are drawn in favor of the plaintiff. See al-Kidd v. Ashcroft, 580 F.3d 949, 956 (9th Cir. 2009). However, neither conclusory statements nor legal conclusions are entitled to a presumption of truth. See Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949-50 (2009); Twombly, 550 U.S. at 555.

If a Rule 12(b)(6) motion is granted, the "district court should grant leave to amend even if no request to amend the pleadings is made, unless it determines that the pleading could not possibly be cured by the allegation of other facts." Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000)(quoting Doe v. U.S., 58 F.3d 484, 497 (9th Cir. 1995)).

Defendants' motions include a request that the Court take judicial notice of three documents recorded with the Sacramento County Recorder: a Grant Deed recorded on March 14, 2008; a Deed of Trust recorded on March 14, 2008; and a Notice of Default and Election to Sell recorded on November 24, 2009. (Defs.' Req. for Judicial Notice ("RJN") Exs. 1-3.)

"As a general rule, a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion." Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (quotations and citation omitted). However, a court may consider matters properly subject to judicial notice. Swartz v. KPMG LLP, 476 F.3d 756, 763 (9th Cir. 2007). A matter may be judicially noticed if it is either "generally known within the territorial jurisdiction of the trial court" or "capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." Fed. R. Evid. 201(b).

Since the three identified documents are publically recorded, they are capable of accurate determination and may be judicially noticed. See W. Fed. Sav. & Loan Ass'n v. Heflin Corp., 797 F. Supp. 790, 792 (1992)(taking judicial notice of documents in a county's public record, including deeds of trust). Therefore, Defendants' request that these documents be judicially noticed is granted.

III. BACKGROUND

On or about March 7, 2008, Plaintiffs obtained a purchase money loan from Defendant GMAC Mortgage, LLC ("GMAC"), which was secured by their home, located at 9820 Spring View Way, Elk Grove, California. (Compl. ¶¶ 1, 7, RJN, Ex. 1.)

The relevant Deed of Trust identifies Defendant Executive Trustee Services, LLC ("ETS") as the trustee and Defendant Mortgage Electronic Registration Systems, Inc. ("MERS") as a nominee for the lender and the lender's successors and assigns. (RJN, Ex. 1.)

Plaintiffs' claims stem from their allegations that Defendants did not explain the loan's interest rate or its volatility, charged improper fees for the loan's placement, and improperly initiated foreclosure proceedings on their home. (Compl. ¶¶ 10, 11, 17.)

IV. DISCUSSION

Plaintiffs' complaint alleges eleven claims against Defendants under federal and state law.

1. Motion to Dismiss

A. Truth in Lending Act Claims

Defendants argue Plaintiffs' damage and rescission claims alleged under the Truth in Lending Act ("TILA") should be dismissed without leave to amend. Specifically, Defendants contend Plaintiffs' TILA damages claim is barred by the applicable one-year statute of limitations, and the loan at issue is a "purchase money loan," which is exempt from TILA's rescission relief. (Def.'s Mot. to Dismiss ("Mot.") 3:14-15, 3:21-22.) Defendants further argue Plaintiffs did not allege their ability to tender or reinstate the subject loan transactions, which Defendants' contend is necessary to state a TILA rescission claim. (Mot. 4:3-4.)

(i) TILA Damages Claim

An action under TILA for actual or statutory damages must be brought "within one year from the date of the occurrence of the violation." 15 U.S.C. § 1640(e). "[A]s a general rule[, this] limitations period starts [to run] at the consummation of the transaction." King v. California, 784 F.2d 910, 915 (9th Cir. 1986). "Consummation" is defined under the statute as "the time that a consumer becomes contractually obligated on a credit ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.