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Scott v. Saxon Mortgage Services, Inc.

United States District Court, Ninth Circuit

January 9, 2014

VICKI D. SCOTT, Plaintiff,


ELIZABETH D. LAPORTE, Magistrate Judge.

Before the Court is Defendant Saxon Mortgage Services' second Motion to Dismiss (docket no. 29). Because this matter was appropriate for decision without oral argument, the Court vacated the December 17, 2013 hearing. For the reasons stated in this Order, Defendant's Motion to Dismiss is granted without leave to amend.

Allegations from the complaint

On December 19, 2006, Plaintiff obtained a mortgage from New Century Mortgage in the amount of $480, 387. Second Am. Compl. ("SAC") ¶ 3; Def.'s Request for Judicial Notice ("Def.'s RJN") Ex. 1.[1] The loan was secured by a Deed of Trust against the real property located at 6004 Old Quarry Loop in Oakland. Id.

In March 2007, New Century Mortgage Company sold Plaintiff's loan to Morgan Stanley Bank, which immediately sold servicing rights to Defendant Saxon Mortgage Services. SAC ¶ 4. After selling Plaintiff's loan, New Century filed for bankruptcy and took two of Plaintiff's mortgage payments without properly crediting them to her loan account. Id . Plaintiff alleges that she provided evidence of the two misapplied payments, but Defendant's representatives refused to offer any alternative solutions, payment retrieval options or credit options. Id.

Plaintiff alleges that Defendant used deceptive tactics, such as teaser interest rates, to steer Plaintiff into a loan that she could not afford. SEC ¶¶ 9-10. Defendant concealed the fact that the monthly payments on the loan would dramatically increase beyond Plaintiff's ability to afford them. Id . ¶ 12.

Plaintiff began to explore ways to retain her home, including applying for a loan modification or refinancing with the goal of a reduced mortgage payment. SAC ¶ 17. Plaintiff could not obtain refinancing, and sought assistance under the Home Owners Loan Act. Id.

Thereafter, because Plaintiff failed to make payments, a Notice of Default was recorded against the property on October 15, 2007. Def.'s RJN Ex. 2. After receiving foreclosure information, in 2008, Plaintiff filed bankruptcy in an effort to save her home. SAC ¶ 18. On or about June 23, 2009, after the automatic bankruptcy stay was lifted, her home was sold at a foreclosure sale to Deutsche Bank National Trust Company, as Trustee for Morgan Stanley ABS Capital I Inc. Trust 2007-NC3. SAC ¶ 18; Def.'s RJN Ex. 3. Plaintiff vacated the property on August 16, 2012. SAC ¶ 18. Plaintiff claims that she learned after August 16, 2012 that she was eligible for assistance through the Home Affordable Modification Program. SAC ¶ 30.

Plaintiff filed this action on July 3, 2013. After Defendant filed a motion to dismiss, Plaintiff filed a first amended complaint on August 12, 2013 containing thirteen claims. After the Court's October 10, 2013 Order granting Defendant's first motion to dismiss in part without leave to amend, Plaintiff timely filed a second amended complaint. Defendant now moves to dismiss the remaining two claims with prejudice.

Legal standard

A complaint will survive a motion to dismiss if it contains "sufficient factual matter... to state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal , 129 S.Ct. 1937, 1949 (2009) (citing Bell Atlantic Corp. v. Twombly , 127 S.Ct. 1955, 1974 (2007)). The reviewing court's "inquiry is limited to the allegations in the complaint, which are accepted as true and construed in the light most favorable to the plaintiff." Lazy Y Ranch LTD v. Behrens , 546 F.3d 580, 588 (9th Cir. 2008).

A court need not, however, accept as true the complaint's "legal conclusions." Iqbal , 129 S.Ct. at 1949. "While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations." Id. at 1950. Thus, a reviewing court may begin "by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth." Id.

Courts must then determine whether the factual allegations in the complaint "plausibly give rise to an entitlement of relief." Id . Though the plausibility inquiry "is not akin to a probability requirement, " a complaint will not survive a motion to dismiss if its factual allegations "do not permit the court to infer more than the mere possibility of misconduct...." Id. at 1949 (internal quotation marks omitted) & 1950. That is to ...

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