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McMahon v. JPMorgan Chase Bank

United States District Court, E.D. California

June 28, 2016

GORDON MCMAHON, an individual, Plaintiff
JPMORGAN CHASE BANK, N.A.; SELECT PORTFOLIO SERVICING, INC.; and DOES 1 through 20 inclusive, Defendants.



         This matter is before the Court on Plaintiff Gordon McMahon's ("Plaintiff") ex parte application for a temporary restraining order ("TRO") and order to show cause regarding preliminary injunction ("Motion") (Doc. #3).[1] The record is confined to the allegations Plaintiff makes in his Complaint (Doc. #1) and his Motion and the opposition (Doc. #6) submitted by defendants JPMORGAN CHASE BANK, N.A. and Select Portfolio Servicing, Inc. ("SPS") (collectively "Defendants"). On this limited record, and as explained below, the Court grants Plaintiff's motion for a TRO.


         In April 2005, Plaintiff executed a promissory note in the amount of $416, 600.00 that was secured by a deed of trust encumbering real property located at 304 Seawind Drive in Vallejo, California ("Subject Property"). Plaintiff defaulted under the terms of his loan on September 1, 2007. A notice of default was recorded on September 8, 2010.

         Plaintiff has submitted at least four loan modification applications since default. Plaintiff alleges that his loan servicers failed to review any of these applications in good faith. His current loan servicer, SPS, invited him to submit a fifth loan modification application on April 26, 2016. By letter dated June 20, 2016, SPS acknowledged that Plaintiff had requested mortgage assistance but stated that Plaintiff had no available options. Also on June 20, 2016, Plaintiff mailed his fifth loan modification application to SPS. The application discusses a material change in Plaintiff's circumstances. SPS received Plaintiff's application on June 21, 2016. Plaintiff submitted additional documents, as requested by SPS, on June 22, 2016. Plaintiff is not aware if the June 20, 2016 SPS letter was in response to Plaintiff s fifth loan modification application. The letter fails to provide a reason for the denial or a 30-day period to appeal SPS's decision.

         SPS is scheduled to conduct a foreclosure sale on the subject property on June 29, 2016. In light of the pending foreclosure sale, Plaintiff requests a TRO to "allow a good faith review of his loan modification application to prevent an unnecessary foreclosure of his family home." Mot. at 3. Plaintiff's counsel emailed SPS's agent about Plaintiff's ex parte Motion. SPS filed an opposition (Doc. #6).

         II. OPINION

         A. Legal Standard

         Federal Rule of Civil Procedure ("Rule") 65 provides authority to issue either preliminary injunctions or TROs. A plaintiff seeking a preliminary injunction must demonstrate that he is "[1] likely to succeed on the merits, [2] that he is likely to suffer irreparable harm in the absence of preliminary relief, [3] that the balance of equities tips in his favor, and [4] that an injunction is in the public interest." Am. Trucking Ass'ns v. City of Los Angeles, 559 F.3d 1046, 1052 (9th Cir. 2009) (quoting Winter v. Natural Res. Def. Council, 555 U.S. 7, 20 (2008)). The requirements for a TRO are the same. Stuhlbarg Int'l Sales Co. v. John P. Brush & Co., 240 F.3d 832, 839 n. 7 (9th Cir. 2001). A party seeking an ex parte TRO must "clearly show that immediate and irreparable injury, loss, or damage will result to the movant before the adverse party can be heard in opposition" and "the movant's attorney [must] certif[y] in writing any efforts made to give notice and the reasons why it should not be required." Fed.R.Civ.P. 65(b). Ex parte TROs are appropriate only when necessary to prevent irreparable harm and should be imposed only "so long as is necessary to hold a hearing." Granny Goose Foods, Inc. v. Bhd. of Teamsters & Auto Truck Drivers Local No. 70 of Alameda Cty., 415 U.S. 423, 439 (1974).

         Local Rule 231(b) states that courts "will consider whether the applicant could have sought relief by motion for preliminary injunction at an earlier date without the necessity of seeking last-minute relief by motion for temporary restraining order." If the Court finds that the movant unduly delayed in seeking injunctive relief, "the Court may conclude that the delay constitutes laches or contradicts the applicant's allegations of irreparable injury and may deny the motion solely on either ground." Local Rule 231(b).

         B. Analysis

         1. Undue Delay

         Defendants argue that the TRO should be denied for failure to comply with Local Rule 231(b). Local Rule 231(b) is discretionary. Without making any findings as to whether Plaintiff unduly delayed the filing, the Court will not deny the TRO at this point solely on the basis of this procedural rule.

         2. Likelihood of ...

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