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Pedersen v. Greenpoint Mortg. Funding, Inc.

United States District Court, E.D. California

September 30, 2012

Christian PEDERSEN, et al., Plaintiffs,
GREENPOINT MORTGAGE FUNDING, Inc., et al., Defendants.

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Holly S. Burgess, Law Offices of Holly S. Burgess, Auburn, CA, for Plaintiffs.

Megan Catherine Kelly, Severson & Werson, San Francisco, CA, Justin Donald Balser, Akerman Senterfitt LLP, Denver, CO, Matthew Bryan Learned, McCarthy and Holthus LLP, San Diego, CA, for Defendants.


KIMBERLY J. MUELLER, District Judge.

I. Background

Mortgage Funding, Inc. (Greenpoint), Marin Conveyancing Corp. (Marin), Quality Loan Service Corp., LSI Title Company, Greenpoint Mortgage Funding Trust Mortgage Pass-Through defendants [1], alleging violations of the Homeowners Equity Protection Act (HOEPA), 15 U.S.C. § 1639 et seq. ; the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. § 2601 et seq. ; the Truth in Lending Act (TILA), 15 U.S.C. § 1601 et seq. and Regulation Z § 226.4; fraudulent misrepresentation; breach of fiduciary duty; unjust enrichment; civil conspiracy; RICO; quiet title; usury and fraud; wrongful foreclosure; and breach of trust instruments.

On April 7, 2011, plaintiffs filed a motion for a temporary restraining order, alleging that a trustee's sale of their house was scheduled for April 11, 2011, but that defendants did not have the legal authority to foreclose on plaintiffs' property. ECF No. 9. Although plaintiffs gave defendants notice of their application for a restraining order, defendants did not respond. ECF No. 14. The court denied the application on April 8, 2011.

Defendants Aurora and MERS filed a motion to dismiss and to expunge a lis pendens on April 15, 2011, in tandem with a request for judicial notice. ECF Nos. 16 & 17.

On April 20, 2011, plaintiffs filed a motion for a preliminary injunction and on the same day, defendants Quality Loan Service Corporation and LSI Title Company filed Declarations of Non-Monetary Status under California Civil Code § 2924l. ECF No. 18. On May 18, 2011, plaintiffs filed objections to these declarations. ECF No. 34.

On August 29, 2011, the court granted defendants' motion to dismiss, giving plaintiff leave to file an amended complaint as to some of the claims; overruled Quality and LSI Title's declaration of non-monetary status; and denied the motion to expunge the lis pendens. It also denied plaintiffs' motion for a preliminary injunction. ECF No. 56, 2011 WL 3818560.

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Plaintiffs filed their first amended complaint (FAC) on September 16, 2011; it raises seven claims: (1) TILA violations; (2) RESPA violations; (3) fraud; (4) unjust enrichment; (5) civil RICO violations; (6) wrongful foreclosure; and (7) quiet title. ECF No. 57.

Defendants Aurora and MERS have filed a motion to dismiss as have defendants Greenpoint and Marin. ECF Nos. 58, 59. Both sets of defendants have asked the court to take judicial notice of a number of documents recorded in Placer County, all relating to the acquisition of and foreclosure on 1977 Green Meadow Lane, Meadow Vista, California. ECF No. 58-2 (Aurora & MERS RFJN); 60 (Greenpoint & Marin RFJN). Plaintiff has opposed and both sets of defendants have filed replies. The court submitted the motions on the pleadings and now GRANTS both motions to dismiss.

II. Standards For A Motion To Dismiss

Under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a party may move to dismiss a complaint for " failure to state a claim upon which relief can be granted." A court may dismiss " based on the lack of cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Department, 901 F.2d 696, 699 (9th Cir.1990). A motion to dismiss under this rule may also challenge the sufficiency of fraud allegations under the more particularized standard of Rule 9(b) of the Federal Rules of Civil Procedure. Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1107 (9th Cir.2003).

Although a complaint need contain only " a short and plain statement of the claim showing that the pleader is entitled to relief," (Fed.R.Civ.P. 8(a)(2)), in order to survive a motion to dismiss this short and plain statement " must contain sufficient factual matter ... to ‘ state a claim to relief that is plausible on its face.’ " Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corporation v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). A complaint must include something more than " an unadorned, the-defendant-unlawfully-harmed-me accusation" or " ‘ labels and conclusions' " or " ‘ a formulaic recitation of the elements of a cause of action.’ " Id. (quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955). Determining whether a complaint will survive a motion to dismiss for failure to state a claim is a " context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679, 129 S.Ct. 1937. Ultimately, the inquiry focuses on the interplay between the factual allegations of the complaint and the dispositive issues of law in the action. See Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984).

In making this context-specific evaluation, this court must construe the complaint in the light most favorable to the plaintiff and accept as true the factual allegations of the complaint. Erickson v. Pardus, 551 U.S. 89, 93-94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007). This rule does not apply to " ‘ a legal conclusion couched as a factual allegation,’ " Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986) (quoted in Twombly, 550 U.S. at 555, 127 S.Ct. 1955), nor to " allegations that contradict matters properly subject to judicial notice" or to material attached to or incorporated by reference into the complaint. Sprewell v. Golden State Warriors, 266 F.3d 979, 988-89 (9th Cir.2001). A court's consideration of documents attached to a complaint or incorporated by reference or a matter subject to judicial notice will not convert a motion to dismiss into a motion for summary judgment. United States v. Ritchie, 342 F.3d 903, 907 (9th Cir.2003);

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Parks School of Business v. Symington, 51 F.3d 1480, 1484 (9th Cir.1995); compare Van Buskirk v. CNN, 284 F.3d 977, 980 (9th Cir.2002) (noting that even though court may look beyond pleadings on motion to dismiss, generally court is limited to face of the complaint on 12(b)(6) motion).

III. Requests For Judicial Notice

As noted, both sets of defendants ask the court to take judicial notice of a number of documents recorded in Placer County related to 1977 Green Meadow Lane, Meadow Vista, California. Plaintiffs have provided the same set of documents, among others, as exhibits to their complaint. Under Rule 201 of the Federal Rules of Evidence, a court may take judicial notice of adjudicative facts " not subject to reasonable dispute" because they are " capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." Plaintiff does not object to the court's consideration of these documents. They are properly before the court. Champlaie v. BAC Home Loans Servicing, LP, 706 F.Supp.2d 1029, 1040 (E.D.Cal.2009); Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir.2001) (court may take judicial notice of matters of public record).

IV. Analysis

A. The Acquisition Of And Foreclosure On 1977 Green Meadow Lane

On April 17, 2007, a deed of trust was recorded in Placer County concerning 1977 Green Meadow Vista Lane, Meadow Vista, identifying plaintiff Tinker as the borrower, GreenPoint Mortgage Funding, Inc. as the lender, the trustee as Marin Conveyancing Corp., and MERS as the beneficiary.[2] ECF No. 60-1 at 2-3. The deed continues:

TRANSFER OF RIGHTS IN THE PROPERTY. The beneficiary of this Security Interest is MERS (solely as nominee [3] for Lender and Lender's successors and assigns) and the successors and assigns of MERS. This Security Instrument secures to Lender: (i) the repayment of the Loan, and all renewals, extensions and modifications of the Note; and (ii) the performance of the Borrower's covenants and agreements under this Security Instrument and the Note. For this purpose, Borrower irrevocably grants and conveys to Trustee, in trust, with power of sale, the ... described property....
Borrower understands and agrees that MERS holds only legal title to the interests granted by Borrower in this Security Instrument, but if necessary to comply with law or custom, MERS (as nominee for Lender and Lender's successors and assigns) has the right: to exercise any or all of those interests, including, but not limited to, the right ...

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