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John Charles Heflebower v. Jp Morgan Chase Bank

November 20, 2012

JOHN CHARLES HEFLEBOWER,
PLAINTIFF,
v.
JP MORGAN CHASE BANK, NA;
CHASE HOME FINANCE LLC; WASHINGTON MUTUAL BANK FA;
TITLE TRUST DEED SERVICE COMPANY; AND DOES 1-20 INCLUSIVE,
DEFENDANTS.



ORDER VACATING NOVEMBER 21, 2012 HEARING AND GRANTING PRELIMINARY INJUNCTION (Doc. No. 6)

Plaintiff John Charles Heflebower ("Plaintiff") seeks a preliminary injunction prohibiting the foreclosure sale of real property located at 5803 W. Shaw Ave., Fresno, CA 93722 (the "Subject Property") by Defendants Title Trust Deed Service Company ("TTDSC"), and JP Morgan Chase Bank, NA ("Chase"), as successor by merger to Chase Home Finance LLC, and as an acquirer of certain assets and liabilities of Washington Mutual Bank, FA, (collectively, "Defendants").*fn1 This court previously granted a Temporary Restraining Order sought by Plaintiff postponing the sale of the property scheduled for November 13, 2012, and ordered Defendants to show cause why a preliminary injunction should not issue. See Court's Docket, Doc. No. 8.

Defendants have filed an Opposition*fn2 and Plaintiff has filed a Reply. See id. Doc. Nos. 12, 14. After reviewing these documents, the court has determined that a hearing is unnecessary. For the reasons that follow, the court will vacate the November 21, 2012 hearing date and grant the preliminary injunction.

ALLEGATIONS & BACKGROUND

Plaintiff's complaint in this matter alleges various claims for relief arising from a mortgage loan transaction related to the Subject Property. On or about January 13, 2006, Plaintiff obtained a loan in the amount of $407,000 from Washington Mutual Bank, FA ("WAMU"), secured by the Subject Property. The loan was evidenced with promissory note. Plaintiff also executed a Deed of Trust in favor of WAMU, which identified Plaintiff as the borrower, WAMU as the lender, and California Reconveyance Company as the trustee. See RJN, Ex. 1.

On September 25, 2008, the United States Office of Thrift Supervision closed WAMU and appointed the FDIC receiver. That same day, Chase acquired certain WAMU assets and liabilities by entering into a Purchase & Assumption Agreement with the FDIC. WAMU's interest in the Subject Property was among the WAMU assets acquired by Chase through the agreement. See RJN, Ex. 2.

Beginning on or about October 18, 2011, Plaintiff alleges he sent Chase Home Finance LLC, the purported servicer of Plaintiff's loan, multiple requests for proof of its claim to an ownership interest in the Subject Property. Plaintiff alleges Chase Home Finance LLC never responded to nor acknowledged those requests. On January 12, 2012, TTDSC recorded a Notice of Default in connection with the Deed of Trust. See RJN, Ex. 3. As of January 10, 2012, the amount owed under Plaintiff's loan and Deed of Trust was $19,765.74. Id. The Notice of Default attached a Declaration of Compliance executed by Chase on November 9, 2011, stating that "[t]he mortgagee, beneficiary, or authorized agent tried with due diligence, but was unable to contact the borrower to avoid foreclosure as required by Cal. Civil Code. Section 2923.5." Id. However, it was not until May 11, 2012, that Chase executed a Substitution of Trustee substituting TTDSC as trustee in connection with the Deed of Trust. See RJN, Ex. 4.

On June 18, 2012, TTDSC recorded a Notice of Trustee's Sale concerning the Subject Property in the Fresno County Recorder's Office. See RJN, Ex. 5. The amount of the unpaid balance and other charges due under the loan and Deed of Trust at the time of recordation of the Notice of Trustee's Sale was estimated at $449,436.64. Id.

Plaintiff alleges TTDSC failed to notify him in person or by telephone prior to recording the Notice of Default in order to assess Plaintiff's financial position and explore options for avoiding foreclosure. Plaintiff further alleges he never received a certified letter or any telephone calls from Chase regarding his options for avoiding foreclosure.

LEGAL STANDARD

Federal Rule of Civil Procedure 65(a) governs the issuance of preliminary injunctions. A plaintiff seeking a preliminary injunction must establish: (1) that he is likely to succeed on the merits, (2) that he is likely to suffer irreparable harm in the absence of preliminary relief, (3) that the balance of equities tips in his favor, and (4) that an injunction is in the public interest. Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 129 S.Ct. 365, 374, 172 L.Ed.2d 249 (2008); Park Vill. Apt. Tenants Ass'n v. Mortimer Howard Trust, 636 F.3d 1150, 1160 (9th Cir. 2011). A moving party must make each of these showings to be entitled to injunctive relief. South Fork Bank Council of W. Shoshone v. United States DOI, 588 F.3d 718, 721 (9th Cir. 2010). Without a sufficient showing of a likelihood of success on the merits, a preliminary injunction cannot issue.

See Gonzales v. Dep't of Homeland Security, 508 F.3d 1227, 1242 (9th Cir.2009); First Brands Corp. v. Fred Meyer, Inc., 809 F.2d 1378, 1385 (9th Cir.1987). "A preliminary injunction is an extraordinary remedy never awarded as a matter of right. In each case, courts must balance the competing claims of injury and must consider the effect on each party of the granting or withholding of the requested relief. In exercising their sound discretion, courts of equity should pay particular regard for the public consequences in employing the extraordinary remedy of injunction." Winter, 555 U.S. at 24 (internal citations omitted).

DISCUSSION

A. Likelihood of Success on ...


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