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Viola Frison v. Home Lenders

July 13, 2011

VIOLA FRISON,
PLAINTIFF,
v.
HOME LENDERS, INC.;
OCEANFRONT MORTGAGE, INC.; COUNTRYWIDE HOME LOANS, INC.; FIDELITY NATIONAL TITLE COMPANY; THE BANK OF NEW YORK IN TRUST FOR REGISTERED HOLDERS OF CWABS, INC. ASSET-BACKED CERTIFICATES, SERIES 2006-BC5; ALL OTHER CLAIMANTS OF WHATSOEVER KIND AND CHARACTER AGAINST REAL PROPERTY COMMONLY KNOWN AS 435 RINGWOOD DRIVE, SAN DIEGO, CA, APN 583-704-04-00; AND DOES 1 THROUGH 100, INCLUSIVE, DEFENDANTS.



The opinion of the court was delivered by: Hon. Jeffrey T.Miller United States District Judge

ORDER GRANTING DEFENDANT THE BANK OF NEW YORK MELLON'S MOTION TO DISMISS ACCREDITED Doc. No.61

Plaintiff Viola Frison brings the current action based on a loan obtained through a refinancing of her home and the subsequent foreclosure proceeding initiated against it. Plaintiff's Second Amended Complaint ("SAC") asserts ten causes of action: (1) violation of the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. §§ 2601 et seq.; (2) violation of the Truth in Lending Act ("TILA"), 15 U.S.C. §§ 1601 et seq.; (3) violation of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692 et seq.; (4) violation of the Rosenthal Fair Debt Collection Practices Act ("Rosenthal Act"), CAL. CIV. CODE §§ 1788 et seq.; (5) violation of California's unfair competition law, CAL. BUS. & PROF. CODE § 17200 ("§ 17200"); (6) breach of fiduciary duty; (7) negligent misrepresentation; (8) fraud; (9) quasi-contract; and (10) a determination invalidating the lien. (Doc. No. 43.) Defendant The Bank of New York Mellon*fn1 ("BNYM") now brings a motion to dismiss the claims against it. (Doc. No. 61.)

Pursuant to CivLR 7.1(d)(1), the court determines this matter is appropriate for resolution without oral argument. For the reasons set forth below, the court GRANTS BNYM's motion to dismiss.

I. BACKGROUND

Plaintiff is an individual and the alleged owner of a parcel of real property located at 435 Ringwood Drive, San Diego, CA. (SAC ¶ 1.) Plaintiff claims that on or around February 24, 2006, she applied for and obtained a loan secured by her real property "[a]t the request of" Defendants Accredited Home Lenders, Inc. ("Accredited"), Oceanfront Mortgage, Inc. ("Oceanfront"), "and others." (Id. ¶ 16.) Although the SAC does not specify the role that each defendant played in the transaction, Oceanfront presumably acted as broker in helping Plaintiff obtain the loan from Accredited. (Id. ¶ 2-3.) Defendants Countrywide Home Loans, Inc. ("Countrywide") and BNYM appear to have subsequently acquired interests in the loan and/or taken over its servicing.*fn2 (Id. ¶¶ 4 & 34.)

According to the SAC, Oceanfront and Accredited made "certain representations regarding the LOAN" to Plaintiff that were inaccurate, including statements regarding the favorability of the loan terms generally, Plaintiff's ability to subsequently refinance the loan to reduce monthly payments, the size of the interest rate and required payments on the loan, the amount of equity in Plaintiff's property, the amount of money available to Plaintiff, the adjustability of the interest rate, and the absence of a balloon payment. (Id. ¶¶ 17-18.) As a result of these representations, Plaintiff was "convinced" by Oceanfront and Accredited to refinance her property. (Id. ¶ 17(d).) According to Plaintiff, the loan documents she was provided with were "complicated and misleading to the average consumer," and their material terms were not explained to her prior to signing. (Id. ¶¶ 24(e) & (h).) Nevertheless, Plaintiff signed the loan documents because she was "rushed through" the process and not given time to properly read and review the papers before agreeing to their terms. (Id. ¶ 24(d).)

Plaintiff claims that the loan proceeds she received afterwards were less than the amount she was promised (id. ¶ 17(l)) and that her payments on the mortgage were higher than Oceanfront and Accredited had told her they would be (id. ¶ 18(b)). Plaintiff also claims that Oceanfront and Accredited failed to disclose key information to her prior to or at the close of the transaction (id. ¶ 19) and did not provide her with copies of the loan documents she signed (id. ¶ 24(f)). In addition, Plaintiff alleges that her initials and signature on the loan application were forged. (Id. ¶ 17(f)-(k).)

After Plaintiff obtained the financing, the loan "subsequently became unaffordable" and foreclosure proceedings were initiated against her. (Id. ¶¶ 18(g), 27(b).) Plaintiff received a Notice to Quit the property on January 23, 2009; however that foreclosure was subsequently halted. (Id. ¶¶ 27(b), 78(d).) According to Plaintiff, following this attempted foreclosure, she submitted a written request for information regarding her loan to Countrywide on or around April 3, 2009. (Id. ¶ 46.) Plaintiff did not receive a response to her request. (Id. ¶ 51.)

Plaintiff filed her original complaint in state court on March 2, 2010. (Doc. No. 1.) Defendant Countrywide subsequently removed the action to federal court, citing federal question jurisdiction. (Id.) Following several rounds of motions to dismiss by Defendants Countrywide and Oceanfront, Plaintiff filed her SAC on November 12, 2010, adding BNYM as a defendant for the first time. (Doc. Nos. 8-9, 18, 24-25 & 33; SAC.) Countrywide and Oceanfront again filed motions to dismiss the SAC. (Doc. Nos. 44 & 46.) The court granted Oceanfront's motion, and granted in part and denied in part Countrywide's motion. (Doc. No. 56.) Although leave to amend was granted, no additional amended complaint was filed.

BNYM now brings a motion to dismiss the claims against it as set forth in the SAC, which Plaintiff opposes. (Doc. Nos. 61 & 64.)

II. LEGAL STANDARD

A motion to dismiss under FED. R. CIV. P. 12(b)(6) challenges the legal sufficiency of the pleadings. De La Cruz v. Tormey, 582 F.2d 45, 48 (9th Cir. 1978). In evaluating the motion, the court must construe the pleadings in the light most favorable to the non-moving party, accepting as true all material allegations in the complaint and any reasonable inferences drawn therefrom. See, e.g., Broam v. Bogan, 320 F.3d 1023, 1028 (9th Cir. 2003). While Rule 12(b)(6) dismissal is proper only in "extraordinary" cases, United States v. Redwood City, 640 F.2d 963, 966 (9th Cir. 1981), the complaint's "[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 (2007). The court should grant 12(b)(6) relief only if the complaint lacks either a "cognizable legal theory" or facts sufficient to support a cognizable legal theory. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990).

III. DISCUSSION

Plaintiff's SAC states four causes of action against BNYM, including violation of the Truth in Lending Act, unfair competition, quasi-contract, and ...


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