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Marco A. Espinoza v. Quality Loan Service Corporation; et al

November 15, 2011

MARCO A. ESPINOZA,
PLAINTIFF,
v.
QUALITY LOAN SERVICE CORPORATION; ET AL., DEFENDANTS.



The opinion of the court was delivered by: Honorable Janis L. Sammartino United States District Judge

ORDER GRANTING MOTION TO DISMISS GREEN TREE SERVICING, LLC; (ECF No. 3)

Presently before the Court is Defendant Green Tree Servicing, LLC's ("Green Tree") motion to dismiss plaintiff's complaint. (Mot. to Dismiss, ECF No. 3) Also before the Court is Plaintiff Marco A. Espinoza's ("Plaintiff") response in opposition, (Resp. in Opp'n, ECF No.4), and Green Tree's reply in support, (Reply in Supp., ECF No. 8). Having considered the parties' arguments and the law, the Court GRANTS Green Tree's motion to dismiss.

BACKGROUND

On or about August 16, 2007, Plaintiff obtained a loan from National City Mortgage Company secured by a deed of trust against Plaintiff's property located in Calexico, California. (Compl. ¶¶ 1, 6, ECF No. 1-1) Subsequently, on March 11, 2010, Plaintiff's deed of trust was assigned to Defendant Green Tree.*fn1 (Mot. to Dismiss 2, ECF No. 3) Plaintiff later became in default on his loan, and a notice of default was recorded on June 24, 2010. (Id.); (Compl. ¶ 7, ECF No. 1-1) Foreclosure proceedings commenced soon thereafter. (Mot. to Dismiss 2--3, ECF No. 3)

On March 8, 2011, Plaintiff-proceeding pro se-filed the instant suit in the Superior Court of the State of California for the County of Imperial. (Compl., ECF No. 1-1) Green Tree was served on March 30, 2011, and on April 29, 2011 removed the action to this Court pursuant to 28 U.S.C. § 1441(b), asserting federal question jurisdiction based on Plaintiff's Truth in Lending Act claim. (Not. of Removal 2, ECF No. 1)

The present motion to dismiss was filed by Defendant Green Tree on May 6, 2011. (Mot. to Dismiss, ECF No. 3) Plaintiff opposed on May 11, 2011, (Resp. in Opp'n, ECF No. 4), and Green Tree replied on June 24, 2011, (Reply in Supp., ECF No. 8). A hearing set on the motion was vacated and the matter was taken under submission without oral argument pursuant to Civil Local Rule 7.1(d)(1).

A second motion to dismiss was filed by Defendant Quality Loan Service Corporation ("QLSC") on June 6, 2011. (QLSC Mot. to Dismiss, ECF No. 7) Plaintiff never filed a response to this motion, and the Court issued an Order granting QLSC's motion to dismiss without prejudice, notifying Plaintiff of the need to file an amended complaint by August 1, 2011 if he wished to continue litigating the case against QLSC. (Order, July 18, 2011, ECF No. 11) Plaintiff failed to file an amended complaint.

LEGAL STANDARD

Federal Rule of Civil Procedure 12(b)(6) permits a party to raise by motion the defense that the complaint "fail[s] to state a claim upon which relief can be granted," generally referred to as a motion to dismiss. The Court evaluates whether a complaint states a cognizable legal theory and sufficient facts in light of Federal Rule of Civil Procedure 8(a), which requires a "short and plain statement of the claim showing that the pleader is entitled to relief." Although Rule 8 "does not require 'detailed factual allegations,' . . . it [does] demand[] more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, - US - , 129 S. Ct. 1937, 1949 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). In other words, "a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do."

Twombly, 550 U.S. at 555 (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). "Nor does a complaint suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.'" Iqbal, 129 S. Ct. at 1949 (citing Twombly, 550 U.S. at 557).

"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Id. (quoting Twombly, 550 U.S. at 570); see also Fed. R. Civ. P. 12(b)(6). A claim is facially plausible when the facts pled "allow[] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556). That is not to say that the claim must be probable, but there must be "more than a sheer possibility that a defendant has acted unlawfully." Id. Facts "'merely consistent with' a defendant's liability" fall short of a plausible entitlement to relief. Id. (quoting Twombly, 550 U.S. at 557). Further, the Court need not accept as true "legal conclusions" contained in the complaint. Id. This review requires context-specific analysis involving the Court's "judicial experience and common sense." Id. at 1950 (citation omitted). "[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not 'show[n]'-'that the pleader is entitled to relief.'" Id. Moreover, "for a complaint to be dismissed because the allegations give rise to an affirmative defense[,] the defense clearly must appear on the face of the pleading." McCalden v. Ca. Library Ass'n, 955 F.2d 1214, 1219 (9th Cir. 1990).

Where a motion to dismiss is granted, "leave to amend should be granted 'unless the court determines that the allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency.'" DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. 1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986)). In other words, where leave to amend would be futile, the Court may deny leave to amend. See Desoto, 957 F.2d at 658; Schreiber, 806 F.2d at 1401.

ANALYSIS

Plaintiff asserts one federal claim, violation of the Truth in Lending Act ("TILA"), and six state law claims: (1) violation of California Civil Code section 2923.5; (2) fraud; (3) intentional misrepresentation; (4) violation of California Civil Code section 2923.6; (5) violation of California Civil Code section 1572; and (6) violation of California Business and Professions Code section 17200. (Compl., ECF No. 1-1) The Court addresses only the TILA claim and, having found that Plaintiff fails to state a claim ...


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