The opinion of the court was delivered by: Oliver W. Wanger United States District Court Judge
Assigned to the Honorable Oliver W. Wanger
ORDER RE MOTION TO DISMISS PLAINTIFFS' COMPLAINT BY DEFENDANTS FIRST FRANKLIN FINANCIAL CORPORATION, HOME LOAN SERVICES, INC. AND MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC.
Date: December 6, 2010 Time: 10:00 a.m. Ctrm: 3
The Motion to Dismiss by defendants FIRST FRANKLIN FINANCIAL CORPORATION, HOME LOAN SERVICES, INC. (sued erroneously as "Home Loan, Inc. dba First Franklin Loan Services"), and MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. (collectively hereinafter as "Defendants") the Complaint filed by Plaintiffs CHAD DILLON SANDRY and MELANIE ELIZABETH SEASHLOTZ ("Plaintiffs") came on regularly for hearing on December 6, 2010, at 10:00 a.m., in Courtroom 3 of the above-entitled Court. All appearances are noted on the record.
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The Court, having read and considered the moving and opposing papers filed in this matter, as well as the oral argument of counsel, being fully advised, and good cause appearing, finds as follows:
Plaintiff Chad Dillon Sandry ("Plaintiff") proceeds with an action for damages and injunctive relief. Plaintiff filed a complaint in California Superior Court on September 17, 2010, and Defendants removed the action to federal court on October 14, 2010. (Doc. 1).
Defendants First Franklin Financial Corp., Home Loan Services, Inc., and Mortgage Electronic Registration Systems, Inc. ("Defendants") filed a motion to dismiss the complaint on October 21, 2010. (Docs. 7, 8). Defendants also filed a motion to strike portions of the complaint and a request for judicial notice. (Docs. 9, 10, 11).
Plaintiff filed opposition to Defendants' motions on November 22, 2010. (Docs. 12, 13). Defendants filed replies to Plaintiff's opposition on November 29, 2010. (Docs. 14, 15).
This action arises out of a loan Plaintiff's obtained for the purchase of their home in or about 2007("subject loan"). (Comp. at 9). Defendant First Franklin Financial Corp. ("FFFC") was identified as the lender under a promissory note and Deed of Trust for the subject loan. (Comp. at 2). FFFC was also the servicer of the subject loan. (Comp. at 2). Defendant Loan Review Incorporated ("LRI") was Plaintiff's mortgage broker for the subject loan. (Comp. at 2).
In 2007, Plaintiffs met with David Hoggett, an employee of LRI. (Comp. at 9). According to the complaint, Hogget submitted a loan application to FFFC that inflated the property value by $95,000, pursuant to an agreement between FFFC and LRI whereby FFFC would accept applications containing false information. (Comp. at 9).
"Defendants" also failed to verify Plaintiffs' income. (Comp. at 10). FFFC paid LRI for leading Plaintiffs into a loan for which they did not qualify. (Comp. at 9). The complaint alleges that FFFC and LRI knew that their conduct could cause Plaintiffs to lose their home through foreclosure. (Comp. at 9). "Defendants" told Plaintiffs that the subject loan was in Plaintiffs' "best interests," but knew that it was not. (Comp. at 10). Plaintiffs placed trust and confidence in "Defendants." (Comp. at 10). The full terms of the loan were not explained to Plaintiffs, Plaintiffs were not given time to review the loan documents, and Plaintiffs could not understand any of the documents they signed. (Comp. at 10). Plaintiffs were charged a much greater ...