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Gullatt v. Aurora Loan Services

October 18, 2010


The opinion of the court was delivered by: Sheila K. Oberto United States Magistrate Judge



Bert Gullatt ("Plaintiff") is proceeding pro se and in forma pauperis in this action filed under the Helping Families Save Their Homes Act of 2009, Pub. L. No. 111-22, § 702, 123 Stat. 1632 (2009) ("Section 702").


On June 18, 2010, Plaintiff filed his complaint asserting that Aurora Loan Services, LLC ("Defendant") is attempting to evict him from his rental home in violation of Section 702 by failing to provide him with the required 90-day notice. Plaintiff asserts that Defendant was the lender and successful bidder at a foreclosure sale of the home Plaintiff rents. Plaintiff contends that Defendant served him with a 90-day notice to vacate the residence. Despite the 90-day notice, Defendant immediately began an unlawful detainer action against him in Stanislaus County Superior Court, Case No. 653855, for the purpose of evicting Plaintiff from the property without complying with Section 702. Plaintiff seeks injunctive relief against Defendant to prevent Defendant from pursuing the unlawful detainer action. Plaintiff also seeks $20,000 in damages and costs of suit.


A. Screening Standard

In cases where the plaintiff is proceeding in forma pauperis, the Court is required to screen each case, and shall dismiss the case at any time if the Court determines that the allegation of poverty is untrue, or the action or appeal is frivolous or malicious, fails to state a claim upon which relief may be granted, or seeks monetary relief against a defendant who is immune from such relief. 28 U.S.C. § 1915(e)(2). If the Court determines that the complaint fails to state a claim, leave to amend may be granted to the extent that the deficiencies of the complaint can be cured by amendment. Lopez v. Smith, 203 F.3d 1122, 1130 (9th Cir. 2000) (en banc).

Further, the Court has an independent duty to examine its own subject matter jurisdiction, whether or not the issue is raised by the parties. United Investors Life Ins. Co. v. Waddell & Reed, Inc., 360 F.3d 960, 966 (9th Cir. 2004); see also Toumajian v. Frailey, 135 F.3d 648, 652 (9th Cir. 1998) ("In this action, as in all actions before a federal court, the necessary and constitutional predicate for any decision is a determination that the court has jurisdiction -- that is the power -- to adjudicate the dispute."). The court shall dismiss an action "[i]f the court determines at any time that it lacks subject-matter jurisdiction." Fed. R. Civ. P. 12(h)(3).

B. Plaintiff's Claim for Damages Under Section 702 Should Be Dismissed

In Logan v. United States Bank National Ass'n, the court examined whether a private right of action exists under Section 702. No. CV 09-08950 MMM (PLAx), 2010 WL 1444878 (C.D. Cal. Apr. 12, 2010). The court concluded that Congress neither expressly nor impliedly created a private right of action to bring suit under Section 702 and dismissed the case for lack of subject matter jurisdiction. Id. at *7-10. This Court finds Logan to be persuasive and convincing authority, and for the reasons stated below, recommends that the action be dismissed due to this Court's lack of subject matter jurisdiction over Plaintiff's suit.

1. Legal Standard -- Statutory Creation of a Private Rights of Action

Section 1331 of Title 28 grants federal courts original jurisdiction over "all civil actions arising under the Constitution, laws, or treaties of the United States." As the Supreme Court observed in Merrell Dow Pharmaceuticals Inc. v. Thompson, 478 U.S. 804, 808, 106 S.Ct. 3229, 3232 (1986), "the vast majority of cases brought under the general federal-question jurisdiction of the federal courts are those in which a federal law creates the cause of action." Id. (citing Franchise Tax Bd. of Cal. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 8-9, 103 S.Ct. 2841, 2846 (1983)).

A private right of action is the right of an individual to bring suit to prevent or remedy an injury that results from another party's actual or threatened violation of a legal requirement. Wisniewski v. Rodale, Inc., 510 F.3d 294, 296 (3d Cir. 2007). The existence of a statutory right of action is a question of statutory construction. Touche Ross & Co. v. Redington, 442 U.S. 560, 568, 99 S.Ct. 2479, 2485 (1979) (citing Cannon v. Univ. of Chi., 441 U.S. 677, 688, 99 S.Ct. 1946, 1953 (1979)). "[T]he fact that a federal statute has been violated and some person harmed does not automatically give rise to a private cause of action in favor of that person." Id. (internal quotation marks and citation omitted).

Determining whether Congress intended to create a private right of action requires an examination of the statute. Interpretation of a statute begins with the language of the statute itself. Id. at 568, 99 S.Ct. at 2485. The statute must either explicitly or impliedly create a right of action. In re Digimarc Corp. Derivative Litig., 549 F.3d 1223, 1230 (9th Cir. 2008) (citing Touche Ross & Co., 442 U.S. at 575, 99 S.Ct. at 2489). An express or explicit private right of action exists when the statute contains language that defines the cause of action. Id.

Where a federal statute does not expressly create a private right of action, a suit may be maintained under that statute only if "Congress intended to provide the plaintiff with a[n implied] private right of action." First Pac. Bancorp, Inc. v. Helfer, 224 F.3d 1117, 1121 (9th Cir. 2000). The Supreme Court has established a four-factor test to determine the existence of an implied private right of action where a statute does not expressly provide one. Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 2088 (1975). The relevant factors include: (1) whether the plaintiff is a member of a class that the statute was enacted to benefit, (2) whether there is an indication of Congress' intent to create or deny a ...

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