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Gholizadeh v. Wells Fargo Bank

United States District Court, C.D. California

December 3, 2014

BAHRAM GHOLIZADEH; FARIDEH GHOLIZADEH, Plaintiffs,
v.
WELLS FARGO BANK; DOES 1 — 100, inclusive, Defendants.

ORDER GRANTING DEFENDANT'S MOTION TO DISMISS [9]

OTIS D. WRIGHT, II, District Judge.

I. INTRODUCTION

The instant action is Plaintiffs' last-ditch effort to avoid the inevitable consequences of defaulting on the mortgage loan that they received from Wells Fargo Bank, National Association's predecessor.[1] On October 21, 2014, Defendant filed a Motion to Dismiss the Complaint and a Request for Judicial Notice in Support of the Motion. (ECF Nos. 9-10.) Plaintiffs did not oppose the Motion or the Request. For the reasons discussed below, the Court GRANTS Defendant's Motion to Dismiss.[2] ( Id. )

II. FACTUAL BACKGROUND

In 1991, Bahram Gholizadeh and Farideh Gholizadeh ("Plaintiffs") obtained a mortgage loan. (Compl. ¶ 11.) In 2008, Wachovia became the servicer of the loan. ( Id. ¶ 12.) Shortly after, Farideh was laid off from his job. ( Id. ¶ 13.) As a result, Plaintiffs suffered severe economic hardship. ( Id. ) In 2009, Plaintiffs defaulted on their loan and requested a loan modification from Wachovia. ( Id. ¶ 14.) Wachovia granted a short reprieve on their payment structure-their interest rate was temporarily reduced, but would continue to increase yearly and eventually reach its original rate. ( Id. ) Without providing any detail, Plaintiffs allege that the loan was a "predatory, high interest rate loan." ( Id. ¶ 15.)

Wells Fargo eventually became the servicer of the loan. ( Id. ) Plaintiffs provide little information as to what transpired with Wells Fargo. ( Id. ¶ 15-16.) In 2011, Plaintiffs defaulted a second time and requested a loan modification from Wells Fargo, but claim that their "attempts to work with Wells Fargo proved to be futile." ( Id. ) After defaulting, Plaintiffs filed a Chapter 7 bankruptcy petition. (RJN, Exs. I-J.) They obtained a discharge and the bankruptcy action was dismissed. (RJN, Ex. I.) Without providing any detail, Plaintiffs allege that Wells Fargo "lost [their] modification packet, made unreliable offers to assist [at] the same time that they were actively attempting to foreclose on the Plaintiffs' property." ( Id. )

On August 26, 2014, Plaintiffs filed suit in the Los Angeles County Superior Court, seeking declaratory and injunctive relief and alleging violations of California Civil Codes § 2923.6 and § 2923.5, violation of The Unfair Competition Law ("UCL"), contractual breach of the implied covenant of good faith and fair dealing, and promissory estoppel. ( Id. ¶ 1.) On September 29, 2014 the instant action was removed to federal court. (ECF No. 1.)

1. California Civil Code §2923.6

Plaintiffs allege that Defendant violated California Civil Code §2923.6(a) by denying Plaintiffs' loan modification request because Plaintiffs qualified and the modification would have been in the best interests of all parties. ( Id. ¶ 19.) Plaintiffs "demand that Defendant consider a loan modification workout option that is beneficial to both parties." Plaintiffs allege that by denying the request for a second loan modification, Defendant directly harmed Plaintiffs and caused a loss. ( Id. ¶ 21.) Plaintiffs do not specify what type of loss.

2. California Civil Code §2923.5

Plaintiffs allege that Defendant violated California Civil Code §2923.5(a)(2) by filing a Notice of Default ("NOD") for the property without first contacting Plaintiffs to assess their financial situation and explore options to avoid foreclosure. ( Id. ¶ 31.) Plaintiffs further allege that Defendant violated the same section by failing to advise Plaintiffs, before recording the NOD. their right to request a subsequent meeting to be scheduled by the beneficiary within 14 days and to provide Plaintiffs with a toll free number to find a HUD-certified housing counseling agency. ( Id. ¶ 32.) Although Plaintiffs are in default, Wells Fargo denies that it recorded a NOD pertaining to Plaintiffs' loan as of the date of the instant Motion. (Mot. 2.)

Plaintiffs allege that Defendant violated California Civil Code §2923.5(b) by filing the NOD without the required declaration stating that Defendant contacted Plaintiff and conducted all necessary due diligence. ( Id. ¶ 33.) Plaintiffs additionally allege that Defendant violated California Civil Code §2923.5(g) by failing to meet numerous due diligence requirements. ( Id. ¶ 34.)

3. Implied Covenant of Good Faith and Fair Dealing

Plaintiffs allege that Defendant breached the implied covenant of good faith and fair dealing by "den[ying] Plaintiffs the ability and opportunity to pay the monthly mortgage payment, after having been made aware of the fact that ...


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