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Diep v. Wells Fargo Bank

United States District Court, C.D. California

October 9, 2014

Bruce Diep et al.
Wells Fargo Bank et al.


JOSEPHINE L. STATON, District Judge.


Before the Court is a Motion to Dismiss filed by Defendant Wells Fargo Bank, N.A. (Docs. 11, 25.) Plaintiffs opposed, and Defendant replied. (Docs. 16, 26, 18.) The Court finds this matter appropriate for disposition without oral argument. See Fed.R.Civ.P. 78; C.D. Cal. R. 7-15. Accordingly, the hearing set for October 10, 2014, at 2:30 p.m. is VACATED. For the following reasons, the Court GRANTS the Motion.


On December 11, 2013, Plaintiffs Bruce Diep and Christie Diep filed a Complaint against Defendant in Orange County Superior Court. (Doc. 1-1, Ex. B.) On February 21, 2014, Plaintiffs filed a First Amended Complaint. (Doc. 1-1, Ex. A.) On March 24, 2014, Defendants removed the case to this Court. (Doc. 1.)

The FAC states the following facts:

Plaintiffs reside at 15672 Butterfield Street in Huntington Beach, California. Plaintiffs obtained a home loan which was securitized. (FAC ¶¶ 2-3.) The securitization of Plaintiffs' loan is governed by a Pooling and Service Agreement. (Id. ¶¶ 6-7.) Subsequent transactions involving the loan's securitization have violated the PSA. (Id. ¶ 14.) Additionally, as part of the securitization process, the mortgage note became separated from the deed of trust, with the deed of trust being transferred to the Mortgage Electronic Registrations System.[1] (Id. ¶ 10.) As a result of these facts, Defendant cannot establish that it legally and properly acquired the note, and Defendant has an imperfect security interest. (Id. ¶¶ 11-12.)

Based on the foregoing facts, Plaintiffs assert claims for: (1) lack of standing to foreclose; (2) fraud in the concealment; (3) fraud in the inducement; (4) intentional infliction of emotional distress; (5) slander of title; (6) quiet title; (7) declaratory relief; (8) violation of the Truth in Lending Act; (9) violation of RESPA; and (10) rescission.


When evaluating a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the Court must accept as true all allegations of material facts that are in the complaint and must construe all inferences in the light most favorable to the non-moving party. Moyo v. Gomez, 32 F.3d 1382, 1384 (9th Cir. 1994). Dismissal of a complaint for failure to state a claim is not proper where a plaintiff has alleged "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 complaint must (1) "contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively, " and (2) "plausibly suggest an entitlement to relief, such that it is not unfair to require the opposing party to be subjected to the expense of discovery and continued litigation." Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011). "Although for the purposes of a motion to dismiss [the Court] must take all of the factual allegations in the complaint as true, [it] [is] not bound to accept as true a legal conclusion couched as a factual allegation.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 555).

In considering a motion to dismiss, the Court is limited to the allegations on the face of the complaint (including documents attached thereto), matters which are properly judicially noticeable, and "documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the pleading." Branch v. Tunnell, 14 F.3d 449, 453-54 (9th Cir. 1994), overruled on other grounds in Galbraith v. Cnty. of Santa Clara, 307 F.3d 1119 (9th Cir. 2002).


A. Lack of standing

Plaintiffs' first claim alleges that Defendant lacks standing to foreclose.

California courts, however, have squarely held that no such cause of action exists. See Gomes v. Countrywide Home Loans, Inc., 192 Cal.App.4th 1149, 1154 (Cal.Ct.App. 2011) (holding that California's nonjudicial foreclosure system is a "comprehensive framework for the regulation of a nonjudicial foreclosure sale" and "[does] not allow for a challenge to the authority of the person initiating the foreclosure"); Jenkins v. JP Morgan Chase Bank, N.A., 216 Cal.App.4th 497, 513 (Cal.Ct.App. 2013) (agreeing with the Gomes court and noting that permitting this cause of action "would fundamentally undermine the nonjudicial nature of the process and introduce the possibility of lawsuits filed solely for the purpose of delaying valid foreclosures.").[2] This does not mean, however, that California borrowers who seek to challenge the foreclosing party's standing to do so are without a remedy. Instead, the proper course is to bring an action either to enjoin the trustee's sale or to set the sale aside. See Robinson v. Countrywide Home Loans, Inc., 199 Cal.App.4th 42, 46 n.5 (Cal.Ct.App. 2011).

Accordingly, this claim is DISMISSED WITH PREJUDICE.

B. Fraud in the Concealment and Fraud in ...

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