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Dennly R. Becker, et al v. Wells Fargo Bank

October 22, 2012

DENNLY R. BECKER, ET AL., PLAINTIFFS,
v.
WELLS FARGO BANK, NA, INC. ET AL., DEFENDANTS.



The opinion of the court was delivered by: Kendall J. Newman United States Magistrate Judge

ORDER AND FINDINGS AND RECOMMENDATIONS

Presently before the court is plaintiff's*fn1 "Motion For Preliminary Injunction" (the "Motion").*fn2 (Motion, Dkt. Nos. 126, 129 (re-filed motion)). Plaintiff seeks a temporary restraining order and preliminary injunction that would stop "all financial institutions regulated by HOLA or the NBA from non-judicially foreclosing on any California homeowner's real property."*fn3 (Motion at 1.) The undersigned takes the matter under submission on the briefs without oral argument pursuant to Local Rule 230(g). The undersigned has fully considered the moving papers and appropriate portions of the record and, for the reasons that follow, denies the Motion.

I. BACKGROUND

Generally, this case involves plaintiff's loans and attempted loan modifications relating to several of plaintiff's pieces of real property, and plaintiff's default on some of those loans. Plaintiff sued the banks or other entities that made, acquired, serviced, or refused to modify the loans, and which ultimately attempted to foreclose on some of the properties. Plaintiff's 113-page First Amended Complaint alleged the following claims for relief against defendants: (1) fraud; (2) violation of the Consumer Legal Remedies Act, Cal. Civ. Code §§ 1750 et seq.; (3) violation of the Unfair Competition Law, Cal. Bus. & Prof. Code §§ 17200 et seq.; (4) false advertising, Cal. Bus. & Prof. Code §§ 17500 et seq.; (5) violation of California Civil Code § 2943; (6) wrongful foreclosure proceedings; (7) quiet title; (8) unfair debt collection practices under state and federal law; (9) Racketeer Influenced and Corrupt Organizations ("RICO") violations, 18 U.S.C. §§ 1961 et seq.; and (10) negligent misrepresentation and negligence. (See First Am. Compl. ¶¶ 181-at pp. 56-103, Dkt. No. 19.)

On August 1, 2011, the district judge adopted findings and recommendations filed by the undersigned and dismissed some of plaintiff's claims with leave to amend and others with prejudice. (See Order, Aug. 1, 2011, Dkt. No. 58.) The court dismissed plaintiff's wrongful foreclosure and quiet title claims with prejudice on the grounds that those claims were preempted by the HOLA, 12 U.S.C. §§ 1461 et seq. (See Order and Findings and Recommendations, Mar. 22, 2011, at 27-32, Dkt. No. 49, adopted by Order, Aug. 1, 2011, at 2, 7.) The court also construed plaintiff's objections to the undersigned's findings and recommendations as a motion for reconsideration and denied it insofar as it challenged the dismissal of the wrongful foreclosure and quiet title claims. (See Order, Aug. 1, 2011, at 2.) In its August 1, 2011 order, the court further explained the relevant HOLA preemption analysis. (Id. at 2-4.)

Remaining unsatisfied with the court's ruling, plaintiff sought reconsideration of the order addressing plaintiff's first motion for reconsideration, arguing that the court committed "clear error" in its analysis of HOLA preemption (Dkt. No. 59). After considering supplemental briefing, the court denied plaintiff's motion for reconsideration of the denial of plaintiff's first motion for reconsideration. (Order, Mar. 29, 2012, Dkt. No. 87.)

Meanwhile, plaintiff filed a Second Amended Complaint and later filed a motion for leave to file a Third Amended Complaint (Dkt. No. 89) before the court could resolve defendants' motion to dismiss the Second Amended Complaint. The undersigned denied plaintiff's motion for leave to amend without prejudice based on the deficiencies in the proposed Third Amended Complaint. The undersigned granted plaintiff leave to file another motion for leave to amend no later than June 28, 2012, and held the motion to dismiss the Second Amended Complaint in abeyance pending resolution of plaintiff's motion for leave to amend. (Order, May 14, 2012, Dkt. No. 92; see also Order, Oct. 17, 2011, Dkt. No. 80.)*fn4 On June 19, 2012, plaintiff filed another motion for leave to file a Third Amended Complaint and a revised, proposed Third Amended Complaint (Dkt. Nos. 97-98). Plaintiff's proposed Third Amended Complaint includes claims for "Preempted/Unlawful Foreclosure" and "Improper Foreclosure Process" that challenge defendants' right to foreclose on plaintiff's properties. (See Proposed Third Am. Compl. ¶¶ 73-89, Dkt. No. 98.)

The undersigned issued Findings and Recommendations recommending that plaintiff's motion for leave to amend (Dkt. No. 97) be granted in part and denied in part, and that plaintiff be granted leave to pursue some of his amended claims but not others. (Order, Aug. 22, 2012, Dkt. No. 115 at 15-17.) Plaintiff's "wrongful foreclosure" and "quiet title" claims are not among those the undersigned recommended that plaintiff be given leave to pursue. (Id.)

The United States District Judge adopted the undersigned's Findings and Recommendations on September 19, 2012. (Dkt. No. 123). On September 29, 2012, defendants moved to dismiss plaintiff's Third Amended Complaint. (Dkt. No. 125.) The motion to dismiss is currently set to be heard on November 15, 2012. (Dkt. Nos. 125, 127-28.)

Plaintiff's pending request for a preliminary injunction and temporary restraining order, taken in context and given the foregoing, is perhaps most accurately construed as yet another of plaintiff's protestations of orders issued previously in this action. (E.g., Motion at 11 ("Plaintiff further requests the Court modify its orders denying plaintiff's claims of misconduct surrounding the use of non-judicial foreclosure by the defendants and allow plaintiff to proceed with any and all such claims").) The undersigned nonetheless construes plaintiff's Motion as plaintiff has framed it - as a request for immediate injunctive relief - and analyzes plaintiff's request on its merits and pursuant to the rules governing the issuance such relief.

II. LEGAL STANDARDS

The standard that governs the issuance of a preliminary injunction is "substantially identical" to the standard that governs the issuance of a temporary restraining order. See Stuhlbarg Int'l Sales Co. v. John D. Brush & Co., 240 F.3d 832, 839 n.7 (9th Cir. 2001); see also Lockheed Missile & Space Co., Inc. v. Hughes Aircraft Co., 887 F. Supp. 1320, 1323 (N.D. Cal. 1995) ("The standard for issuing a temporary restraining order is identical to the standard for issuing a preliminary injunction."); accord Cal. Independent Sys. Operator Corp. v. Reliant Energy Servs., Inc., 181 F. Supp. 2d 1111, 1126 (E.D. Cal. 2001).

"A plaintiff seeking a preliminary injunction must establish that he [or she] is likely to succeed on the merits, that he [or she] is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his [or her] favor, and that an injunction is in the public interest." Winter v. Natural Resources Def. Council, Inc., 129 S. Ct. 365, 374 (2008); accord Earth Island Institute v. Carlton, 626 F.3d 462, 469 (9th Cir. 2010). The Ninth Circuit Court of Appeals has "also articulated an alternate formulation of the Winter test, under which 'serious questions going to the merits' and a balance of hardships that tips sharply towards the plaintiff can support issuance of a preliminary injunction, so long as the plaintiff also shows that there is a likelihood of irreparable injury and that the injunction is in the public interest." Farris v. Seabrook, 677 F.3d 858, 864 (9th Cir. 2012) (internal quotation marks omitted) (quoting Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1135 (9th Cir. 2011). With respect to the validity of the four-part test prior to Winter, the Ninth Circuit Court of Appeals has clarified that, "[t]o the extent prior cases applying the 'serious questions' test have held that a preliminary injunction may issue where the plaintiff shows only that serious questions going to the merits were raised and the balance of hardships tips sharply in the plaintiff's favor, without satisfying the other two prongs, they are superseded by Winter, which requires the plaintiff to make a showing on all four prongs." Cottrell, 632 F.3d at 1135 (clarifying four-part test under Winter) (citing Miller v. Gammie, 335 F.3d 889, 900 (9th Cir. 2003) (en banc)).

"An injunction is a matter of equitable discretion" and is "an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief." Winter, 129 S. Ct. at 376, 381; accord Earth Island Institute, 626 F.3d at 469-70. "A preliminary injunction is an ...


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