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Alexander v. Deutsche Bank National Trust Co.

United States District Court, Ninth Circuit

July 1, 2013

LONI ALEXANDER, LONI ALEXANDER AS TRUSTEE FOR PROVENCE TRUST, Plaintiffs,
v.
DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE, and Does 1-10 inclusive, Defendants.

ORDER GRANTING MOTION TO DISMISS WITH PREJUDICE [Doc. No. 5]

MICHAEL M. ANELLO, District Judge.

Plaintiff Loni Alexander ("Plaintiff"), on behalf of herself and as Trustee for Provence Trust, brings this mortgage-related dispute against Defendant Deutsche Bank National Trust Company ("Defendant"). Defendant now moves to dismiss Plaintiff's Complaint under Federal Rules of Civil Procedure 8 and 12(b)(6). See Doc. No. 5. Upon receiving leave of Court, Plaintiff filed an untimely opposition to the motion, to which Defendant replied. See Doc. Nos. 8-4, 12. For the following reasons, the Court GRANTS Defendant's motion to dismiss.

BACKGROUND[1]

On June 28, 2007, Plaintiff obtained a $999, 999 mortgage loan from IndyMac Bank, FSB ("IMB") in order to refinance her residence located at 2167 South Grade Road, Alpine, California ("the Property"). [Compl. ¶¶ 6, 33.] The loan was secured by a deed of trust on the Property. [ Id. ¶ 33.] The deed of trust lists Mortgage Electronic Registration Systems, Inc. ("MERS") as the beneficiary, and Chicago Title Insurance Co. as Trustee. [ Id. ; see June 28, 2007 Deed of Trust, Def's Request for Judicial Notice ("RJN"), Ex. A.]

Plaintiff then alleges that IMB attempted to sell or assign her loan, but, for reasons difficult to discern from the complaint, did not validly do so. [Compl. ¶ 35.] Later, IMB was acquired by OneWest Bank Group, LLC ("OneWest"). Id. ¶ 36.] Plaintiff alleges that "[t]o date, there have been no valid substitutions or assignments... such that [IMB], and now [OneWest] as successor remains the owner of the Note and the Lender under the Note and Deed of trust, and Chicago Title remains the named Trustee to the exclusion of all others." [ Id. ¶ 42.]

According to Defendant, shortly after Plaintiff's loan closed, Plaintiff's loan was pooled and placed in the IndyMac INDA Mortgage Loan Trust 2007-FLX6, Mortgage Pass-Through Certificates, Series 2007-FLX6 ("2007 Trust") pursuant to the terms of a Pooling and Servicing Agreement dated July 1, 2007 ("PSA"). [ See RJN, Ex. B.] Although ownership of Plaintiff's loan was transferred to the 2007 Trust, IMB retained the servicing rights to the loan. [ Id. at 1.] On July 11, 2008, IMB failed and was closed by the Office of Thrift Supervision. The FDIC was appointed as receiver. [ See Office of Thrift Supervision Order ("OTS") Order No. 2008-24, RJN, Ex. C.] The assets of IMB were transferred to the newly-chartered IndyMac Federal Bank, FSB ("IMFB"), for which the FDIC was appointed as Conservator and operated IMFB from July 11, 2008 until March 19, 2009. [ See generally Servicing Business Asset Purchase Agreement, RJN, Ex. D.] On March 19, 2009, IMFB was closed and the FDIC was appointed as Receiver. In its capacity as receiver, the FDIC sold and transferred certain assets of IMFB to newly-formed OneWest. The transferred assets included the servicing rights to Plaintiff's loan. [ See id. ] On January 10, 2011, MERS assigned its beneficial interest in Plaintiff's loan to Deutsche Bank, as trustee for the 2007 Trust. [ See Assignment of Deed of Trust, RJN, Ex. F.] This assignment was recorded on June 3, 2011. [ Id. ]

Plaintiff alleges that on February 24, 2011, Meridian Foreclosure Service ("Meridian") caused to be recorded and sent to Plaintiff a Notice of Default and Election to Sell Under Deed of Trust. [Compl. ¶ 44.] Plaintiff alleges that Luis Henriquez, who signed the notice, was not authorized to do so by IMB, OneWest, or MERS. [ Id. ¶¶ 46-47.] Plaintiff alleges that Defendant was merely a third-party stranger to the loan transaction, with no right or power to act under the Note or Deed of Trust. [ Id. ¶ 50.] Plaintiff does not dispute that money is owed on her mortgage obligation. [ Id. ¶ 31.]

Based on these events, on February 20, 2013, Plaintiff alleging claims for (1) declaratory relief; (2) negligence; (3) breach of quasi contract; (4) violation of the Fair Debt Collection Practices Act ("FDCPA"); (5) violation of California's Unfair Business Practices act; (6) accounting; and (7) cancellation of instruments. Plaintiff asserts "the documents recorded by or on behalf of [Defendant] were not in any manner authorized or executed by a real party in interest in the Note and Deed of Trust, and are fabrications and forgeries executed by as yet unidentified rogue employees of [Defendant]." [Compl. ¶ 30.]

LEGAL STANDARD

A Rule 12(b)(6) motion to dismiss tests the sufficiency of the complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). "While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must be enough to raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotations, brackets, and citations omitted).

In reviewing a motion to dismiss under Rule 12(b)(6), the Court must assume the truth of all factual allegations and must construe them in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). Legal conclusions need not be taken as true merely because they are cast in the form of factual allegations. Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir. 1987); W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). Similarly, "conclusory allegations of law and unwarranted inferences are not sufficient to defeat a motion to dismiss." Pareto v. FDIC, 139 F.3d 696, 699 (9th Cir. 1998).

In determining the propriety of a Rule 12(b)(6) dismissal, generally, a court may not look beyond the complaint for additional facts. United States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003); Parrino v. FHP, Inc., 146 F.3d 699, 705-06 (9th Cir. 1998). However, Federal Rule of Evidence 201 allows the Court to take judicial notice of certain items without converting the motion to dismiss into one for summary judgment. Barron v. Reich, 13 F.3d 1370, 1377 (9th Cir. 1994). The Court may take judicial notice of facts "not subject to reasonable dispute" because they are either: "(1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." Fed.R.Evid. 201; see also Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001) (noting that the court may take judicial notice of undisputed "matters of public record"), overruled on other grounds by 307 F.3d 1119, 1125-26 (9th Cir. 2002). The court may disregard allegations in a complaint that are contradicted by matters properly subject to judicial notice. Daniels-Hall v. Nat'l Educ. Ass'n, 629 F.3d 992, 998 (9th Cir. 2010).

DISCUSSION

A. Judicial Notice

Defendant seeks judicial notice of seven documents: (1) a copy of the Deed of Trust recorded on July 17, 2007 in the official records of the San Diego County Recorder; (2) the July 1, 2007 PSA between IMB and Defendant, which is publically available on the Security Exchange Commission's website; (3) a July 11, 2008, order from the Office of Thrift Supervision appointing the FDIC as receiver; (4) a Servicing Business Asset Purchase Agreement between the FDIC, the receiver for IMFB, and OneWest available on the FDIC's website; (5) the Notice of Default recorded February 24, 2011 in the official records of the San Diego County Recorder as instrument no. 2011-0102393; (6) the Assignment of Deed of Trust recorded on June 3, 2011 in the official records of the San Diego County Recorder as instrument no. 2011-0284142; and (7) the Assignment of Deed of Trust recorded on July 20, 2012, in the official records of the San Diego County Recorder as instrument number XXXX-XXXXXXX.

Under Federal Rule of Evidence 201(b), a district court may take notice of facts not subject to reasonable dispute that are "capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." Fed.R.Evid. 201(b). Plaintiff objects to Defendant's request for judicial notice, arguing that this Court should not take judicial notice of the facts stated within the documents, as the statements are hearsay. [ See Opp. at 1-2.] However, Plaintiff does not question the authenticity of the documents themselves. The Court overrules Plaintiff's hearsay objections in light of the fact that all of Defendant's exhibits are available from public records. For example, Exhibits A (Deed of Trust), E (Notice of Default), F (Assignment of Deed), and G (further Assignment), of which Defendant requests judicial notice, are all records filed with the county recorder. Courts routinely take judicial notice of these types of documents. See, e.g., Liebelt v. Quality Loan Serv. Corp., 2011 WL 741056, at *6 n.2 (N.D. Cal. 2011); Reynolds v. Applegate, 2011 WL 560757, at *1 n.2 (N.D. Cal. 2011); ...


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