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Edward Gomez v. World Savings Bank Fsb

December 10, 2010


The opinion of the court was delivered by: Oliver W. Wanger United States District Judge



Plaintiff Edward Gomez proceeds pro se with an action for damages and injunctive relief. Plaintiff filed a first amended complaint ("FAC") in California Superior Court, and certain Defendants removed the action to federal court on August 12, 2010. (Doc. 1). Defendants Wells Fargo Bank, Wachovia Mortgage, and Wells Fargo Home Mortgage filed a motion to dismiss Plaintiff's complaint on October 26, 2010. (Doc. 16). Defendants also filed a motion to strike portions of the complaint and a request for judicial notice. (Doc. 18). Plaintiff has not filed opposition to Defendants' motion.


On or about June 25, 2008, Plaintiff obtained a loan secured by a First Trust Deed of Trust for the purpose of purchasing a residence ("subject loan"). (FAC at 4). "Defendants" serviced the loan. (FAC at 4). The complaint alleges that "Defendants" conspired to cause Plaintiff to enter into instruments that would result in foreclosure of Plaintiff's residence. (FAC at 5).

According to the complaint, the terms and conditions of the subject loan were not fully explained to him, and the subject loan extended to Plaintiff exceeded the expected value of the property. (FAC at 6). Plaintiff complains that he was not provided sufficient time to read all the documents at the closing of the loan transaction, and that he was not provided copies of the loan documents, including documents regarding the cost of the credit Plaintiff received. (FAC at 6).

Plaintiff was unable to make payments on the loan he received and has been harassed by "Defendants" and unknown parties to vacate his residence. (FAC at 7). Plaintiff alleges he has not been afforded an opportunity to effect a good faith modification of his loan. (FAC at 7).


Dismissal under Rule 12(b)(6) is appropriate where the complaint lacks sufficient facts to support a cognizable legal theory. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir.1990). To sufficiently state a claim to relief and survive a 12(b) (6) motion, the pleading "does not need detailed factual allegations" but the "[f]actual allegations must be enough to raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). Mere "labels and conclusions" or a "formulaic recitation of the elements of a cause of action will not do." Id. Rather, there must be "enough facts to state a claim to relief that is plausible on its face." Id. at 570. In other words, the "complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, --- U.S. ----, ----, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (internal quotation marks omitted).

The Ninth Circuit has summarized the governing standard, in light of Twombly and Iqbal, as follows: "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. U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir.2009) (internal quotation marks omitted). Apart from factual insufficiency, a complaint is also subject to dismissal under Rule 12(b)(6) where it lacks a cognizable legal theory, Balistreri, 901 F.2d at 699, or where the allegations on their face "show that relief is barred" for some legal reason, Jones v. Bock, 549 U.S. 199, 215, 127 S.Ct. 910, 166 L.Ed.2d 798 (2007).

In deciding whether to grant a motion to dismiss, the court must accept as true all "well-pleaded factual allegations" in the pleading under attack. Iqbal, 129 S.Ct. at 1950. A court is not, however, "required to accept as true allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences." Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir.2001). "When ruling on a Rule 12(b)(6) motion to dismiss, if a district court considers evidence outside the pleadings, it must normally convert the 12(b)(6) motion into a Rule 56 motion for summary judgment, and it must give the nonmoving party an opportunity to respond." United States v. Ritchie, 342 F.3d 903, 907 (9th Cir.2003). "A court may, however, consider certain materials-documents attached to the complaint, documents incorporated by reference in the complaint, or matters of judicial notice-without converting the motion to dismiss into a motion for summary judgment." Id. at 908.


The FAC is comprised primarily of general allegations and legal conclusions. For the most part, the FAC does not identify the conduct of any individual Defendant. Rather, the FAC makes conclusory allegations that purportedly apply to all Defendants, but fails to allege facts needed to provide the individual Defendants fair notice of the nature of Plaintiff's claims against them. Because the factual deficiencies of the FAC require dismissal pursuant to Rule 8, adjudication of Defendants' preemption and statute of limitations arguments is unnecessary with respect to most of Plaintiff's claims.

A. First Claim for Relief: "Predatory Lending"

Plaintiff's first claim for relief is for "predatory lending" predicated on alleged violations of California Financial Code § 4970, the federal Home Loan and Equity Protection Act ("HOEPA"), the federal Truth in Lending Act ("TILA"),15 U.S.C. §1637, and California Business and Professions Code § 17500. (FAC at 7). The FAC fails to state facts sufficient to properly allege any statutory violations.

The FAC fails to allege facts sufficient to establish that the subject loan is a "covered loan" under California Financial Code section 4970. Whether or not a loan is covered depends on the size of the loan and "[t]he total points and fees payable by the consumer." Cal. Fin. Code § 4970(b). Because the FAC fails to make any averments as to the specific terms of the loan, it fails to describe these facts and does not state a claim for relief under section 4670.

The FAC alleges facts which establish that HOEPA is not applicable to the subject loan. HOEPA does not apply to residential mortgage transactions, 12 C.F.R. 226.32(a)(2)(i), and the FAC alleges that the subject loan was obtained for ...

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