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Bowman v. Mortgage

United States District Court, N.D. California

May 13, 2014



MARIA-ELENA JAMES, Magistrate Judge.


Pending before the Court is Defendant Wells Fargo Bank N.A.'s[1] Motion to Dismiss Plaintiff Christine Bowman's Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. Dkt. No. 5. Plaintiff filed an Opposition on May 12, 2014. Dkt. No. 25. The Court finds this motion suitable for disposition without oral argument. Civ. L.R. 7-1(b). Having considered the parties' papers, relevant legal authority, and the record in this case, the Court DENIES Wells Fargo's Motion for the reasons set forth below.


Plaintiff purchased the property located at 3532 Harbor View Avenue, Oakland, California (the "Property") in 2001. Compl. ¶ 15 (Not. of Rem. Ex. A), Dkt. No. 1. She refinanced on August 20, 2004, at which time Plaintiff borrowed $466, 800.00 from World Savings Bank, FSB, secured by a deed of trust recorded against the property.[2] Id. ¶ 15; Req. for Jud. Not. ("RJN") Ex. A, Dkt. No. 6. In January 2008, World Savings Bank, FSB changed its name to Wachovia Mortgage, FSB, and later changed its name to Wells Fargo Bank Southwest, N.A., before merging into Wells Fargo Bank, N.A. in November 2009. RJN Exs. B-F.

In 2010, Plaintiff lost her job and applied for a loan modification with Wells Fargo, but kept current on her mortgage payments. Compl. ¶ 16. In September 2011, Wells Fargo offered her a forbearance program. Id. ¶ 17. Plaintiff did not realize that at the end of the forbearance period, she was required to pay back the amount paid. Id. When the program expired in October 2012, Plaintiff alleges she was told for the first time that she had to reimburse Wells Fargo for the unpaid payments. Id. ¶ 18. As she could not make the payments, she began the process of being reviewed for another loan modification.[3] Id.

Plaintiff met and worked with a representative Housing and Urban Development agency in August 2012. Id. ¶ 19. In October 2012, she went to an event and sat face to face with an employee of Wells Fargo, at which time she applied for the loan modification. Id. On February 28, 2013, Plaintiff contacted her single point of contact at Wells Fargo, Delia Ponce, and was told they were waiting for an appraisal, after which they would make a determination. Id. ¶ 20.

Wells Fargo denied Plaintiff's modification on March 15, 2013. Id. ¶ 21. Plaintiff immediately contacted Ms. Ponce and informed her that she was appealing the decision based on her change in income and decreased debts. Id. Plaintiff also discussed her appeal on March 17 with Michael Valsquez, who Plaintiff states is "possibly a manager" at Wells Fargo. Id. Mr. Valsquez reviewed Plaintiff's financial information and informed her that, based on the current financials, "she was now in the ball park for a loan modification approval." Id. He encouraged Plaintiff to reapply. Id. Plaintiff also spoke with Ms. Ponce on March 21 and April 9, 2013, at which time she was informed that her account still showed she was in active review for an appeal. Id. ¶ 22.

On April 8, 2013, a Notice of Default was filed. Id. ¶ 23; RJN Ex. G. In the meantime, Plaintiff continued to work on her loan modification, faxing additional documents and a loan modification package. Compl. ¶ 24. While working on the modification, Plaintiff alleges she received conflicting letters regarding her loan, both the modification and foreclosure proceedings. Id. ¶ 25. She called Ms. Ponce, who assured Plaintiff that she should not worry about the foreclosure letters since Wells Fargo would not proceed with foreclosure while Plaintiff was seeking a modification. Id.

Plaintiff alleges that Ms. Ponce also encouraged her to attend a conference in Richmond, at which she could immediately qualify for a loan modification. Id. ¶ 26. However, Plaintiff was told at the conference that they were missing an appraisal for the property, so they could not determine if she was qualified. Id. ¶ 27. Plaintiff states that Ms. Ponce never told her she needed an appraisal to qualify. Id. ¶ 28.

Plaintiff's loan modification was denied on August 26, 2013. Id. ¶ 30. There is no dispute that Plaintiff defaulted on the loan. Compl. ¶¶ 16-18.

Plaintiff filed her Complaint on November 18, 2013, in the Superior Court of the State of California for the County of Alameda, and Wells Fargo removed it to this Court on December 18, 2013. Dkt. No. 1. She alleges two causes of action: (1) violation of the California Homeowner Bill of Rights ("HBOR") section 2923.6; and (2) negligence. Compl. ¶¶ 43-57. She seeks general and special damages, an injunction for sale of the property, an equitable accounting, and attorney's fees and costs.


Under Federal Rule of Civil Procedure ("Rule") 12(b)(6), a party may file a motion to dismiss based on the failure to state a claim upon which relief may be granted. A Rule 12(b)(6) motion challenges the sufficiency of a complaint as failing to allege "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A facial plausibility standard is not a "probability requirement" but mandates "more than a sheer possibility that a defendant has acted unlawfully." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotations and citations omitted). For purposes of ruling on a Rule 12(b)(6) motion, the court "accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most favorable to the non-moving party." Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). "[D]ismissal may be based on either a lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory." Johnson ...

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