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Callan v. Experian Information Solutions, Inc.

United States District Court, Ninth Circuit

July 5, 2013




On July 6, 2012, Plaintiff Kathleen Callan ("Plaintiff") commenced the instant action against Experian Information Solutions, Inc. ("Experian"), TransUnion, LLC ("TransUnion"), [1] and Equifax, Inc. ("Equifax"), alleging violations of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681 et seq. Compl., Dkt. 1. On November 26, 2012, Plaintiff filed a first amended complaint ("FAC") in which she joined New York Community Bank ("NYCB") as a Defendant, alleging that NYCB wrongfully foreclosed on her home in Pittsburg, California. Dkt. 43.

The parties are presently before the Court on NYCB's motion to dismiss. Dkt. 52. Plaintiff opposes the motion. Dkt. 54. Having read and considered the papers filed in connection with this matter and being fully informed, the Court hereby GRANTS NYCB's motion to dismiss with prejudice, for the reasons stated below. The Court, in its discretion, finds this matter suitable for resolution without oral argument. See Fed.R.Civ.P. 78(b); N.D. Cal. Civ. L.R. 7-1(b).


On or about April 19, 2007, Plaintiff borrowed $358, 000 from Ohio Savings Bank to purchase a residential property located at 347 Jorgensen, Pittsburg, CA 94565 (the "Property"). FAC ¶ 44. The loan was secured by a Deed of Trust ("DOT") against the property identifying Ohio Savings Bank as the "Lender, " New Century Title Company as the "Trustee, " and MERS as both the "nominee for Lender and Lender's successors and assigns" and the "beneficiary under this Security Instrument." NYCB's Request for Judicial Notice ("RJN"), Exh. A, Dkt. 52-2. The DOT provides that MERS has the right to foreclose on the Property: "Borrower understands and agrees that... MERS (as nominee for Lender and Lender's successors and assigns) has... the right to foreclose and sell the Property." Id.

On December 4, 2009, Ohio Savings Bank was shut down by the United States Office of Thrift Supervision ("OTS"), FAC ¶ 45, [2] and the Federal Deposit Insurance Corporation ("FDIC") was named as Receiver. See[3] The "Failed Bank Information" on the FDIC's official website states that the loans and accounts of AmTrust Bank - formerly Ohio Savings Bank, were acquired by NYCB, and instructs AmTrust Bank customers as follows: "If you had a loan with AmTrust Bank, you should continue to make your payments as usual. The terms of your loan will not change, because they are contractually agreed to in your promissory note. Checks should be made payable as usual and sent to the same address until further notice." See id.

Plaintiff defaulted on her mortgage payments, which resulted in the recording of a Notice of Default and Election to Sell Under a Deed of Trust ("NOD") on June 1, 2010 by Cal-Western Reconveyance Corporation ("Cal-Western"). NYCB's RJN, Exh. C. The NOD states that MERS, as beneficiary, "has deposited with said trustee such Deed of Trust" and "does hereby elect to cause the trust property to be sold to satisfy the obligations secured thereby." Id . On July 2, 2010, an Assignment of Deed of Trust was recorded, stating that MERS, as nominee for Ohio Savings Bank, granted, assigned and transferred all beneficial interest under the DOT to NYCB on April 19, 2010. NYCB's RJN, Exh. B. On September 2, 2010, Cal-Western recorded a Notice of Trustee's Sale. NYCB's RJN, Exh. D. On November 22, 2010, the Property was sold at public auction to NYCB. NYCB's RJN, Exh. E. The Trustee's Deed upon Sale was recorded on December 6, 2010. Id . On April 8, 2011, NYCB sold the Property. NYCB's RJN, Exh. F.

On an unknown date in 2010, Plaintiff, proceeding pro se, filed a complaint in Contra Costa County Superior Court alleging claims arising out of the foreclosure of the Property. See Dkt. 55-1.[4] On March 9, 2011, Plaintiff filed an amended verified complaint alleging claims against various Defendants, including claims against Ohio Savings Bank for injunctive relief, unjust enrichment, and to set aside or vacate the foreclosure sale. Id . On April 1, 2011, NYCB, "as assignee from FDIC as Receiver from AmTrust Bank formerly known as Ohio Savings Bank (erroneously sued as Ohio Savings Bank), "[5] filed a demurrer to Plaintiff's amended verified complaint. Id . On June 21, 2011, NYCB's demurrer was sustained without leave to amend. Id . On October 17, 2011, the amended verified complaint was dismissed as to NYCB with prejudice and judgment was entered against Plaintiff and in favor of NYCB. Id.

On July 6, 2012, Plaintiff commenced the instant action. See Compl. On November 26, 2012, Plaintiff filed a FAC alleging claims against NYCB for: (1) cancellation of instruments; and (2) wrongful foreclosure. See FAC ¶¶ 43-54.

With regard to her claim for cancellation of instruments, Plaintiff alleges that after Ohio Savings Bank was shut down by the OTS, NYCB directed Cal-Western to falsify an "Assignment of Beneficial Interest in Deed of Trust" on behalf of MERS as nominee for the "non-existent" Ohio Savings Bank to NYCB "in an attempt to create the appearance of a chain of title in Plaintiff's property to [NYCB]." FAC ¶¶ 46-47. Plaintiff further alleges that based upon "falsified documentation, " NYCB directed Cal-Western "to conduct a foreclosure sale, then creat[ed] a Trustee's Deed Upon Sale in NYCB's favor, which was then recorded on December 6, 2010, clouding plaintiff's title...." Id . ¶ 48. Plaintiff also alleges that NYCB "caused Cal Western to unlawfully record a Notice of Default and a Notice of Trustees [sic] sale incident to the procedural requirements of Civil Code 2924 et seq." Id . ¶ 48. According to Plaintiff, she is entitled under California law "to make an application for an order cancelling each of the void instruments alleged above." Id . ¶ 50.

With regard to her wrongful foreclosure claim, Plaintiff alleges that, "[t]hrough its actions in directing [Cal-Western] to falsify an Assignment of the Deed of Trust executed in favor of Ohio Savings Bank, and then foreclosing and evicting [her], [NYCB] did wrongfully foreclose on [her]...." FAC ¶ 53. As a remedy for her claims against NYCB, Plaintiff seeks damages as well as cancellation of the NOD, the Assignment of Deed of Trust, the Notice of Trustee's Sale, and the Trustee's Deed Upon Sale. See id. at 18.


A complaint may be dismissed under Rule 12(b)(6) for failure to state a claim if the plaintiff fails to state a cognizable legal theory, or has not alleged sufficient facts to support a cognizable legal theory. Balistreri v. Pacifica Police Dep't , 901 F.2d 696, 699 (9th Cir. 1990). In deciding a Rule 12(b)(6) motion, courts generally "consider only allegations contained in the pleadings, exhibits attached to the complaint, and matters properly subject to judicial notice." Swartz v. KPMG LLP , 476 F.3d 756, 763 (9th Cir. 2007). Although allegations in a complaint are generally accepted as true, a court "need not accept as true allegations contradicting documents that are referenced in the complaint or that are properly subject to judicial notice." Lazy Y Ranch Ltd. v. Behrens , 546 F.3d 580, 588 (9th Cir. 2008).

To survive a motion to dismiss for failure to state a claim, the plaintiff must allege "enough facts to state a claim [for] relief that is plausible on its face." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570 (2007). A claim has facial plausibility, "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal , 556 U.S. 662, 678 (2009). Where a complaint or claim is dismissed, leave to amend is ...

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