ORDER GRANTING DEFENDANTS' MOTION TO DISMISS [Dkt. No.8]
GONZALO P. CURIEL, District Judge.
On May 15, 2013 Plaintiff Michael Mottale ("Plaintiff") filed a complaint ("Complaint") against defendants Kimball Tirey & St. John ("KTSJ"), Alegria Real Estate Fund IV, LLC ("Alegria"), Patricia Coyne ("Coyne"), and Christine Relph ("Relph") (collectively, "Defendants"). On June 4, 2013, Defendants filed a motion to dismiss, (Dkt. No. 8), pursuant to Federal Rule of Civil Procedure 12(b)(6), and a request for judicial notice, (Dkt. No. 9). The motion has been fully briefed. (Dkt. Nos. 12, 13.) Pursuant to L.Civ.R. 7.1(d)(1), the Court finds the matter suitable for adjudication without oral argument. For the reasons set out below, the Court GRANTS Defendants' Motion to Dismiss without prejudice.
On February 23, 2007, Plaintiff and his spouse, Erica Mottale, completed a loan ("Loan") for the property located at 304 Crestview Drive, Bonita, California, 91902 ("Property"). (RJN, Ex. 2.) The Loan was secured by a deed of trust ("DOT") and a promissory note. (Id.) The DOT listed Mortgage Electronic Registration System ("MERS") as the beneficiary, Bear Stearns Residential Mortgage Corporation ("Bear") as the lender, and First American Title Company ("First American") as the trustee under "this Security Instrument." (Id.)
On September 22, 2010, Recontrust Company ("Recontrust"), acting as agent of MERS, executed a notice of default and election to sell under deed of trust ("NOTS"), which showed that Plaintiff was in default on the Loan in the amount of $52, 467.01. (RJN, Ex. 3.) The NOD informed Plaintiff that the Property "may be sold without any court action." (Id.)
On September 24, 2010, MERS executed a substitution of trustee and assignment of deed of trust ("Assignment"). (RJN, Ex. 7.) In the Assignment, MERS assigned the DOT to BAC Home Loan Serving, LP ("BAC") and substituted Recontrust as the trustee under the DOT. (Id.)
On August 3, 2011, Recontrust recorded a notice of trustee's sale ("NOTS 2") in San Diego County, which showed that Plaintiff was in default on the Loan in the amount of $854, 171.22. (RJN, Ex. 2.) The NOD 2 also stated that the Property may be sold at a public auction. (Id.)
On March 14, 2013, Recontrust executed a trustee's deed upon sale, in which Recontrust sold the Property to Alegria. (Dkt. No. 9 at 34.)
On May 15, 2013, Plaintiff filed the Complaint against KTSJ, Alegria, Coyne, and Relph alleging fraudulent and negligent misrepresentation, violations of the Fair Debt Collection Practices Act ("FDCPA") and the California Business & Professional Code § 17200. (Complaint.) Plaintiff also seeks to quiet title to the property. (Id.)
Plaintiff alleges his home was foreclosed by unnamed investors who brought forth an unlawful detainer action in state court. Plaintiff alleges his loans were securitized from a pool of funds provided by unknown investors who misrepresented the identities of the actual lenders. (Complaint at 4.) Plaintiff alleges the Assignment was invalid and fraudulent because the assignment documents were forged and defective. (Complaint at 4-5.) Plaintiff further alleges the Notice of Default ("NOD") was void because BAC had "no prior recorded interest" in the Property when Recontrust recorded the NOD. (Complaint at 4-5.) Plaintiff alleges the NTS 2 was also fraudulent because Reconstrust had no legal right to record a substitution of trustee. (Id.)
Defendants move to dismiss Plaintiff's Complaint on several grounds. (Dkt. No. 8.) First, Defendants argue Plaintiff failed to show he tendered the amount owed under default, and thus Plaintiff lacks standing to challenge the foreclosure. (Id. at 11-12.) Second, Defendants argue Plaintiff's securitization theory has been rejected by several courts in California. (Id. at 13.) Defendants further contend that possession of the promissory note is not a pre-requisite to commence Non-Judicial Foreclosure proceeding. (Id. at 14.) Defendants also point to a number of deficiencies in the Complaint, including failure to joint an indispensible party and defective and insufficient claims under other statutes. (Id. at 10, 11-15.)
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the sufficiency of a complaint. Navarro v. Block , 250 F.3d 729, 732 (9th Cir. 2001). Dismissal is warranted under Rule12(b)(6) where the complaint lacks a cognizable legal theory. Robertson v. Dean Witter Reynolds, Inc. , 749 F.2d 530, 534 (9th Cir. 1984); see Neitzke v. Williams , 490 U.S. 319, 326 (1989) ("Rule12(b)(6) authorizes a court to dismiss a claim on the basis of a dispositive issue of law."). Alternatively, a complaint may be dismissed where it presents a cognizable legal theory yet fails to plead essential facts under that theory. Robertson , 749 F.2d at 534. While a plaintiff need not give "detailed factual allegations, " a plaintiff must plead sufficient facts that, if true, "raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 545 (2007). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal , 556 U.S. 662, 678 (2009) (quoting Twombly , 550 U.S. at 547). A claim is facially plausible when the factual allegations permit "the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id . In other words, "the non-conclusory factual content, ' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. Secret Service , 572 F.3d 962, 969 (9th Cir. 2009). "Determining whether a complaint states a plausible claim for relief will... be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Iqbal , 556 U.S. at 679.
In reviewing a motion to dismiss under Rule 12(b)(6), the court must assume the truth of all factual allegations and must construe all inferences from them in the light most favorable to the nonmoving party. Thompson v. Davis , 295 F.3d 890, 895 (9th Cir. 2002); Cahill v. Liberty Mut. Ins. Co. , 80 F.3d 336, 337-38 (9th Cir. 1996). Legal conclusions, however, need not be taken as true merely because they are cast in the form of factual allegations. Ileto v. Glock, Inc. , 349 F.3d 1191, 1200 (9th Cir. 2003); W. Mining Council v. Watt , 643 F.2d 618, 624 (9th Cir. 1981). When ruling on a motion to dismiss, the court may consider the facts alleged in the complaint, documents attached to the complaint, documents relied ...