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Carter v. Central Pacific Mortgage Company

November 19, 2010

ROBERT CARTER, INDIVIDUALLY BY AND THROUGH HIS GUARDIAN AD LITEM, MILDRED CARTER, AND ON BEHALF OF THE GENERAL PUBLIC OF THE STATE OF CALIFORNIA, MILDRED CARTER, INDIVIDUALLY AND ON BEHALF OF THE GENERAL PUBLIC OF THE STATE OF CALIFORNIA, PLAINTIFFS,
v.
CENTRAL PACIFIC MORTGAGE COMPANY, INC., A CORPORATION; BANK OF AMERICA, INC., A CORPORATION; TRAVIS CHATMAN, AN INDIVIDUAL; TISHA TAYLOR, AN INDIVIDUAL; TM REALTY, INC., A CORPORATION AND DOES 1 TO 50, DEFENDANTS.



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

ORDER GRANTING DISMISSAL MOTION AND DISMISSAL UNDER 28 U.S.C. § 1367(c)*fn1

Defendant Bank of America, N.A. ("BofA") moves for dismissal of Plaintiffs' Complaint under Federal Rule of Civil Procedure ("Rule") 12(b)(6). BofA also argues it was sued erroneously as Bank of America, Inc. Plaintiffs failed to file an opposition to the motion.

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 Atl. 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. Pac. Police Dept., 901 F.2d 696, 699 (9th Cir. 1988). To avoid dismissal, a 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, conclusory statements and legal conclusions are not entitled to a presumption of truth. See Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949-50 (2009); Twombly, 550 U.S. at 555. "In sum, for a complaint to survive a motion to dismiss, the nonconclusory 'factual content,' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. United States Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009). BofA requests that judicial notice be taken of "a deed of trust securing the $487,500 loan to [Plaintiffs] on [property located at 2556 Palmira Ave., South Lake Tahoe, California], recorded with the El Dorado County Recorder" on March 24, 2006. (Def.'s Req. for Judicial Notice ("Def.'s RJN") Ex. E.) A court "may take judicial notice of matters of public record and may consider them without converting a Rule 12 motion into one for summary judgment." United States v. 14.02 Acres of Land, 547 F.3d 943, 955 (9th Cir. 2008) (quotations and citations omitted). Since this Deed of Trust is a matter of public record, BofA's request for judicial notice of this Deed of Trust is granted.

II. Background

Plaintiffs purchased a home located at 2556 Palmira Avenue, South Lake Tahoe, CA 96150 ("Palmira Property") in March of 2006. (Pl.'s Compl. ¶ 19.) The purchase price was $650,000. Id. On March 23, 2006, Plaintiffs obtained a loan from Defendant Central Pacific Mortgage Company, Inc. ("Central Pacific Mortgage") in the amount of $487,500 to finance the purchase of the home. Id.; (Def.'s RJN Ex. E.) The loan was secured with a Deed of Trust on the Palmira Property. (Def.'s RJN Ex. E.) BofA became the successor in interest to Central Pacific Mortgage on the loan. (Pl.'s Compl. ¶ 7.)

Plaintiffs initiated this action in May of 2010, alleging that Defendant Travis Chatman ("Chatman") or Defendant Tisha Taylor ("Taylor") falsified information on Plaintiffs' loan application. Id. ¶¶ 24-25. Plaintiffs also allege that Chatman, Taylor, and Defendant TM Realty, Inc. ("TM Realty") misinformed Plaintiffs about the terms and conditions of the loan. Id. ¶ 26.

On October 27, 2010, Defendants Central Pacific Mortgage, Chatman, and Taylor were dismissed from this action without prejudice under Rule 4(m), because of Plaintiffs' failure to respond to an Order to Show Cause ("OSC') issued under this rule on September 13, 2010. The OSC required Plaintiffs to either provide proof that these Defendants were served with process or show good cause for failing to serve these defendants. (Order 2:11-17, Sept. 13, 2010.)

Plaintiffs allege that the basis for jurisdiction in this action is federal question and diversity. The basis for federal question jurisdiction is Plaintiffs' damages and rescission claims under the Truth in Lending Act, 15 U.S.C. § 601 et seq. ("TILA"). Supplemental jurisdiction exists over Plaintiffs' several state claims. However, Plaintiffs' factual allegations do not support Plaintiffs' conclusion that the court has diversity jurisdiction over this action. Specifically, Plaintiffs allege in their Complaint that diversity jurisdiction exists under 28 U.S.C. § 1332 because "Plaintiff [sic] and at least one defendant reside in different states . . . ." (Pl.'s Compl. ¶ 2.) However, diversity jurisdiction under 28 U.S.C. § 1332 requires that "each defendant must be a citizen of a different state from each plaintiff." In re Digimarc Corp. Derivative Litig., 549 F.3d 1223, 1234 (9th Cir. 2008). Since Plaintiffs' Complaint alleges Plaintiffs and some of the Defendants reside in the same state (Pl.'s Compl. ¶¶ 4-5, 8-9.), there is no diversity jurisdiction over any of Plaintiffs' claims.

III. Discussion

A. TILA ...


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