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Shawn Krock v. Financial Title Company; Equifirst Corporation; Mortgage

January 6, 2012

SHAWN KROCK,
PLAINTIFF,
v.
FINANCIAL TITLE COMPANY; EQUIFIRST CORPORATION; MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. (MERS); U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE FOR STRUCTURED ASSET SECURITIES CORPORATION TRUST 2007-EQ1; WELLS FARGO BANK, N.A.; NDEX WEST, LLC; ANDREW FONTI; WILLARD CALVIN LYFORD; CAPSTONE HOME LOAN CORPORATION; AND DOES 1 THROUGH 100, INCLUSIVE, DEFENDANTS.



ORDER GRANTING DEFENDANTS‟ MOTION TO DISMISS

This matter comes before the Court on a Motion to Dismiss (Doc. #7) presented by Defendants Mortgage Electronic Registration Systems, Inc. ("MERS"), Wells Fargo Bank, N.A. ("Wells Fargo"), and U.S. Bank National Association, as Trustee for Structured Asset Securities Corporation Trust 2007-EQ1 ("USB"), collectively "Defendants." Defendants ask the Court to dismiss the eight claims (1,2,8,9,10,11,12 and 13) asserted against them in the First Amended Complaint ("FAC") (Doc. #1) 2 filed by Plaintiff Shawn Krock ("Plaintiff"). Though 3 Plaintiff‟s Opposition (Doc. #18) is docketed as opposing a 4 separate Motion to Dismiss filed by Defendant EquiFirst 5 Corporation ("EquiFirst") (Doc. #14), the caption and substance 6 of the Opposition indicate that Plaintiff opposes this motion.*fn1

I. FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND

This action arises out of a mortgage loan extended to Plaintiff by EquiFirst in December 2006. The loan was used to refinance Plaintiff‟s prior loan secured by property located at 7431 Rio Linda Boulevard, Rio Linda, California ("the Property"). In March 2010, Plaintiff defaulted on the loan, and after the loan went into default, Defendant NDEx West, LLC ("NDEx") generated and recorded a Notice of Default as agent for the beneficiary.

On April 29, 2010, a Substitution of Trustee was recorded, pursuant to which NDEx assumed the role of Trustee under the Deed of Trust. MERS generated an Assignment of Deed of Trust on May 10, 2010, pursuant to which USB assumed the role of beneficiary.

On June 23, 2010, NDEx, as substitute trustee, generated the required Notice of Trustee‟s Sale. On November 29, 2010, the Property was sold at a Trustee‟s Sale to USB.

The gravamen of Plaintiff‟s allegations is that there was 2 fraud and other improprieties in the origination of the loan and 3 technical defects throughout the foreclosure process. 4

Plaintiff filed the Complaint on January 4, 2011 and the 5 FAC on August 17, 2011 in the Superior Court of California, 6 Sacramento, alleging thirteen causes of action: (1) Fraud and 7 Deceit; (2) Negligent Misrepresentation; (3) Breach of Fiduciary 8 Duty; (4) Aiding and Abetting; (5) Breach of Contract (6) 9 Tortuous Interference with Contractual Relations; (7) Negligence; (8) Wrongful Foreclosure; (9) To Set Aside Trustee Sale; (10) Quiet Title; (11) An Accounting; (12) Violation of the Truth in Lending Act (15 U.S.C. § 1601); (13) Violation of Real Estate Settlement Procedures Act (12 U.S.C. § 2605). EquiFirst, with the consent of the other Defendants, removed the case to this Court based on federal question jurisdiction, 28 U.S.C. § 1331, on September 19, 2011 (Doc. #1). Defendants and EquiFirst filed separate motions to dismiss (Doc. #7 and Doc. #14, respectively). Plaintiff opposed the instant motion and failed to file an opposition or a notice of non-opposition to EquiFirst‟s Motion to Dismiss. The Court granted EquiFirst‟s Motion to Dismiss with Prejudice (Doc. #23).

II. OPINION

A. Legal Standard

1. Motion to Dismiss

A party may move to dismiss an action for failure to state a claim upon which relief can be granted pursuant to Federal Rule of Civil Procedure section 12(b)(6). In considering a motion to dismiss, the court must accept the allegations in the 2 complaint as true and draw all reasonable inferences in favor of 3 the plaintiff. Scheuer v. Rhodes, 416 U.S. 232, 236 (1975), 4 overruled on other grounds by Davis v. Scherer, 468 U.S. 183 5 (1984); Cruz v. Beto, 405 U.S. 319, 322 (1972). Assertions that 6 are mere "legal conclusions," however, are not entitled to the 7 assumption of truth. Ashcroft v. Iqbal, 129 S.Ct. 1937, 1950 8 (2009), citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 9 (2007). To survive a motion to dismiss, a plaintiff needs to plead "enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570. Dismissal is appropriate where the plaintiff fails to state a claim supportable by a cognizable legal theory. Balistreri v. Pacifica Police Department, 901 F.2d 696, 699 (9th Cir. 1990).

Upon granting a motion to dismiss for failure to state a claim, the court has discretion to allow leave to amend the complaint pursuant to Federal Rule of Civil Procedure § 15(a). "Dismissal with prejudice and without leave to amend is not appropriate unless it is clear . . . that the complaint could not be saved by amendment." Eminence Capital, L.L.C. v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003).

2. Judicial Notice

Defendants request judicial notice of the Deed of Trust, Loan Modification Agreement, Assignment of the Deed of Trust, the Notice of Default and Election to Sell Under Deed of Trust, Substitution of Trustee, Notice of Trustee‟s Sale, Assignment of Deed of Trust, Trustee‟s Deed Upon Sale (Doc. #7, Exs. 1-6). Plaintiff does not object to Defendants‟ request.

Courts may consider extrinsic evidence when "plaintiff's 2 claim depends on the contents of a document, the defendant 3 attaches the document to its motion to dismiss, and the parties 4 do not ...


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