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Raymundo Gonzalez; Ray A. Gonzalez; andramona Gonzalez v. Cna Foreclosure Service

June 29, 2011


The opinion of the court was delivered by: Hon. Michael M. Anello United States District Court


Currently before the Court are Plaintiffs Raymundo Gonzalez, Ray A. Gonzalez, and Ramona Gonzalez's motion for summary judgment [Doc. No. 21], and Defendant CNA Foreclosure Service, Inc.'s motion for summary judgment [Doc. No. 22]. On April 4, 2011, the Court in its discretion found the motions suitable for determination on the papers and without oral argument, pursuant to Civil Local Rule 7.1(d)(1). For the reasons set forth below, the Court GRANTS Defendant's motion for summary judgment, and DENIES Plaintiffs' motion for summary judgment.


The following facts are not reasonably in dispute.*fn1 Plaintiffs owned residential real property located at 40 Walnut Avenue, Chula Vista, California 91911 ("Property"). [Doc. No. 21, Exh. E, Decl. of Michele Canty, 12:3-6.] Plaintiffs obtained the Property subject to a $330,000 loan, secured by a Deed of Trust in favor of Dakota Loans, Inc. [See Doc. No. 24, Exh. A.] Plaintiffs failed to make their June 1, 2009 loan payment, and Dakota Loans retained Defendant CNA Foreclosure Service ("CNA") on or about August 17, 2009 to act as trustee and file a Notice of Default "and proceed with the foreclosure proceedings as necessary." [Id.; Canty Decl. 12:10-14; 12:21-13:8.] Prior to CNA's involvement, Land America Commonwealth Title was the Trustee of record for the Property. [Canty Decl. 24:9-17; Doc. No. 24, Exh. E.] Although CNA "accepted the position as trustee at the time the notice of default was filed . . . CNA was not recorded as the trustee until later." [Canty Decl. 24:9-25:10.] Specifically, CNA recorded the Substitution of Trustee on November 25, 2009. [Doc. No. 24, Exh. D.]

On August 18, 2009, at Dakota Loan's instruction, CNA caused a "notice of default and election to sell under deed of trust" to be recorded against the Property. [Doc. No. 24, Exh. A; Canty Decl. 26:20-21; 27:7-20.] CNA also mailed the notice to Plaintiffs, which stated that as of August 17, 2009, Plaintiffs were past due in their loan payments and owed $11,536.53. [Doc. No. 24, Exh. A.] The Notice of Default further stated CNA had been appointed as Trustee. [Id.]

On August 28, 2009, CNA mailed Plaintiffs a "30 Day Notice" entitled "Notice Under Fair Debt Collection Practices Act" advising Plaintiffs their mortgage loan had been referred to CNA "for foreclosure based upon default under the terms of the Note and Deed of Trust." [Doc. No. 24, Exh. B.] The August 28 letter included a copy of the previously recorded Notice of Default, and stated, in bolded and underlined text: "Please be advised that we are attempting to collect a debt. Any information obtained from the Trustor will be used for that purpose." [Id.]

Plaintiffs filed the present action against CNA on September 17, 2009, alleging two causes of action for violations of the Fair Debt Collection Practices Act ("FDCPA") and California'sRosenthal Fair Debt Collection Practices Act ("Rosenthal Act"). [Doc. No. 1.] The parties filed their cross-motions for summary judgment on February 8, 2011.


Pursuant to Federal Rule of Civil Procedure 56, a party is entitled to summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Hubbard v. 7-Eleven, 433 F. Supp. 2d 1134, 1139 (S.D. Cal. 2006) (citing former Fed. R. Civ. P. 56(c)(2)). It is beyond dispute that "[t]he moving party bears the initial burden to demonstrate the absence of any genuine issue of material fact." Horphag Research Ltd. v. Garcia, 475 F.3d 1029, 1035 (9th Cir. 2007) (citation omitted). "Once the moving party meets its initial burden, . . . the burden shifts to the nonmoving party to set forth, by affidavit or as otherwise provided in Rule 56, specific facts showing that there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986) (internal quotation marks and citations omitted).

A mere scintilla of evidence is not sufficient "to defeat a properly supported motion for summary judgment; instead, the nonmoving party must introduce some 'significant probative evidence tending to support the complaint.'" Fazio v. City & County of San Francisco, 125 F.3d 1328, 1331 (9th Cir. 1997) (quoting Anderson, 477 U.S. at 249, 252). Thus, in opposing a summary judgment motion it is not enough to simply show that there is some metaphysical doubt as to the material facts. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986) (citations omitted). However, when assessing the record to determine whether there is a "genuine issue for trial," the court must "view the evidence in the light most favorable to the nonmoving party, drawing all reasonable inferences in his favor." Horphag, 475 F.3d at 1035 (citation omitted). On summary judgment, the Court may not make credibility determinations; nor may it weigh conflicting evidence. See Anderson, 477 U.S. at 255. Thus, as framed by the Supreme Court, the ultimate question on a summary judgment motion is whether the evidence "presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Id. at 251-52.



"The FDCPA was enacted to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses." Izenberg v. ETS Servs., LLC, 589 F. Supp. 2d 1193, 1198 (C.D. Cal. 2008) (internal marks omitted) (citing 15 U.S.C. § 1692(e)). As a threshold matter, liability cannot attach under the FDCPA unless the defendant is a debt collector, trying to collect a debt. Id. at 1199.

Plaintiffs assert they are entitled to summary judgment because CNA is a debt collector within the meaning of the FDCPA, and CNA failed to provide Plaintiffs with the notices required by the statute. [Doc. No. 21, p. 1.] In addition, Plaintiffs accuse CNA of making false, deceptive, and misleading statements in the notices, and wrongfully threatening to take legal action against Plaintiffs it could not legally take. [Id.] Defendant opposes Plaintiffs' motion and also moves for summary judgment ...

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