UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA
June 21, 2012
CARLA VISENDI, ET AL.,
BANK OF AMERICA CORP., ET AL., DEFENDANTS.
The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge
Before the Court is Plaintiff's Motion for Leave to Amend Complaint (ECF No. 87). The Motion is granted. All other pending motions, except for Plaintiffs' Ex Parte Request for Pendente Lite Order (ECF No. 140) are therefore moot.*fn1 The Ex Parte Request for Pendente Lite Order (ECF No. 140) is denied.
This is a "mass action" in which approximately 137 plaintiffs generally allege that the defendants (banks and other entities that are engaged in, or participated in, the mortgage business), perpetrated a massive fraud by inducing the plaintiffs to enter into mortgages between 2003 and 2008 which thereafter lost value damaging plaintiffs. (Complaint, ECF No. 2, Ex. A. ("Compl.") Plaintiffs originally brought suit in the Superior Court of California - Sacramento, but the case was removed to this Court in September 2011 on the basis of diversity jurisdiction. (See ECF No. 2 and Compl., ECF No. 2, Ex. A).
Plaintiffs did not amend their Complaint within the twenty-one-day time period provided for by Federal Rules of Civil Procedure 15(a)(1) (permitting a plaintiff to amend complaint as a matter of course within twenty-one days after serving it).*fn2
Thereafter, the parties filed numerous motions, including several motions to dismiss (see supra note 1). In November 2011, Plaintiffs filed the instant Motion to Amend, which was unopposed by all Defendants except for WMC Mortgage, LLC ("WMC") (ECF No. 109) and NL Inc.*fn3 ("NL") (ECF No. 114).
In their Motion to Amend, Plaintiffs contend that Defendants' motions to dismiss generally challenged the sufficiency of their pleadings under Rule 9(b) (heightened pleading standard for fraud allegations) and they want to amend their pleadings to address the alleged deficiencies. (ECF No. 81 at 1-2.) In addition, Plaintiffs want to (1) add additional causes of action; (2) add additional similarly-situated plaintiffs; and (3) remove claims that are based on the Constitutional Right to Privacy. (Id. at 2).
Defendants WMC and NL oppose. (ECF Nos. 109 and 114). WMC generally contends that (1) Plaintiffs desire to expand their complaint is unsupported, (2) would be futile because Plaintiffs have not stated a claim against WMC; and (3) is procedurally defective because it was filed two days before Plaintiffs' opposition was due. (ECF No. 109 at 2-5.) NL also contends that leave to amend should be denied as futile because Plaintiffs have failed to state any cause of action as to NL. (ECF No. 114 at 1-4.)
On March 9, 2012, Plaintiffs filed an "Ex Parte Request for Pendente Lite Order," in which they request that the Court enjoin all foreclosure or repossession actions directed at Plaintiffs' real property pending the Court's jurisdictional decision. (ECF No. 140). The BAC Defendants filed an opposition. (ECF No. 141.)
Rule 15(a)(2) provides that when a party moves to amend before trial, "[t]he court should freely give leave when justice so requires." Courts generally consider four factors in determining whether to deny a motion to amend: "bad faith, undue delay, prejudice to the opposing party, and the futility of amendment." Kaplan v. Rose, 49 F.3d 1363, 1370 (9th Cir. 1994); see also Foman v. Davis, 371 U.S. 178, 182(1962) (stating that Rule 15(a)'s "mandate is to be heeded," and that "[i]n the absence of any apparent or declared reason . . . the leave sought should, as the rules require, be 'freely given.' "). Generally, leave to amend is denied only when it is clear the deficiencies of the complaint cannot be cured by amendment. DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. 1992).
Here, Plaintiffs have not yet amended their original Complaint, a fact that which weighs strongly in favor of permitting them to amend now. Further, it appears that permitting Plaintiffs to amend will assist both the parties and the Court by giving Plaintiffs the chance to tailor their claims and allegations in light of Defendants' contentions in the motions to dismiss, as well as whatever new information Plaintiffs have developed. The Court is not persuaded by WMC and NL's futility contentions at this time, as Plaintiffs' amendment may address the issues WMC and NL raise. Therefore, the Court will permit Plaintiffs leave to amend their Complaint.
Plaintiffs' request that the Court enjoin all foreclosure and repossession activity directed at their property pending the Court's jurisdictional decision (ECF No. 140), on the basis that while this action is pending, some Plaintiffs are being dispossessed of their properties as Defendants file eviction actions in state courts, and these courts, Plaintiffs contend, are usurping the Court's power to decide the issues related to Plaintiffs' property. (Id. at 2-7.)
While it is within the Court's authority to issue a preliminary injunction where final equitable relief is sought, see Reebok Int'l, Ltd. v. Marnatech Enters., Inc., 970 F.2d 552, 559 (9th Cir. 1992) ("the injunction is authorized by the district court's inherent equitable power to issue provisional remedies ancillary to its authority to provide final equitable relief"), Plaintiffs' request is premature and factually deficient. Here, Plaintiffs' claims have not yet been tested and they have chosen to amend their Complaint in the face of multiple motions to dismiss by adding and removing parties, allegations, and claims, so what the nature of their allegations and claims will be in their amended complaint is a matter of speculation. Plaintiffs' bare allegations of irreparable harm raised in the pendente lite request are conclusory and this Court has no basis to conclude that the eviction actions are unlawful or unreasonable.*fn4
For the reasons set forth above, Plaintiffs' Motion to Amend Complaint (ECF No. 87) is GRANTED and Plaintiffs' Ex Parte Request for Pendente Lite Order (ECF No. 140) is DENIED. Plaintiffs shall file any amended complaint within thirty (30) calendar days after this Order is filed electronically.
IT IS SO ORDERED.