United States District Court, E.D. California
CYNTHIA A. JAMISON, individually and on behalf of all others similarly situated, Plaintiff
BANK OF AMERICA, N.A., Defendant.
Cynthia A. Jamison filed this putative class action against
defendant Bank of America, N.A. ("BANA"), alleging
BANA: (1) violated the Truth in Lending Act of 1968
("TILA"), 15 U.S.C. § 1601 et seq.,
TILA's implementing regulation, Regulation Z, 12 C.F.R.
§ 1026 et seq., and the California Consumers
Legal Remedies Act ("CLRA"), Cal. Civ. Code §
1750 et seq., by failing to disclose insurance claim
proceeds in its mortgage payoff and periodic statements; and
(2) violated the California Unfair Competition Law
("UCL"), Cal. Bus. & Prof. Code § 17200 et
seq., by charging plaintiff a facsimile fee for
providing a payoff statement that was delivered by mail. This
matter is before the court on defendant's motion to
dismiss the complaint or, alternatively, to stay the
proceedings pending the Supreme Court's decision in
Spokeo, Inc. v. Robins, which has now issued,
see 136 S.Ct. 1540, 578 U.S.____ (2016). ECF No. 9
("Mot."). Plaintiff opposed the motion, ECF No. 11
("Opp'n"), and defendant replied, ECF No. 18
("Reply"). The court held a hearing and initial
scheduling conference on June 17, 2016; Patricia Avery, Aidan
Poppler, and Matthew Insley-Pruitt appeared for plaintiff,
and Amanda Groves appeared for defendant. As explained below,
the court GRANTS IN PART and DENIES IN PART defendant's
filed her complaint on February 26, 2016. ECF No. 1. BANA
filed the instant motion to dismiss on April 19, 2016. ECF
No. 9. Defendant advances four arguments for dismissal: (1)
TILA and Regulation Z do not require that mortgage payoff or
periodic statements itemize insurance proceeds; (2)
TILA's statute of limitations bars plaintiff's claims
that arose prior to February 2, 2015; (3) the complaint fails
to plead a "good" or "service" covered by
the CLRA or any actual damages; and (4) the complaint pleads
only conclusory allegations with respect to the UCL claim.
See generally Mot. Plaintiff opposes the
motion, responding that (1) BANA violated TILA's
requirement that banks provide "accurate" mortgage
statements; (2) plaintiff's claims are based only on
statements issued by BANA within TILA's limitations
period; (3) mortgage services are "services"
covered by the CLRA, and the complaint alleges damages
arising from plaintiff's disputes with her contractor;
and (4) the complaint sufficiently states a UCL claim.
See generally Opp'n.
Factual Allegations and Claims
about November 19, 2009, plaintiff obtained a mortgage loan
with a principal amount of $175, 986.00, secured by a deed of
trust recorded against her residential home at 905 Nogales
Street, Sacramento, California ("the property").
Compl. ¶ 23, ECF No. 1; Deed of Trust ("DOT"),
Def.'s Ex. A, ECF No. 9-1. BANA was the owner and servicer
of the mortgage at all pertinent times. Compl. ¶ 8.
Section four of the deed of trust requires plaintiff to
maintain property insurance and provides that, in the event
of loss, payments be made directly to BANA. Id.
¶ 24; DOT at 3. Section four continues, "All or any
part of the insurance proceeds may be applied by Lender, at
its option, either (a) to the reduction of the indebtedness
under the Note and this Security Instrument . . ., or (b) to
the restoration or repair of the damaged Property."
Compl. ¶ 25; DOT at 3.
about December 31, 2010, a fire broke out in plaintiff's
home, leaving it uninhabitable. Compl. ¶ 28. Plaintiff
submitted a claim to her insurance company, USAA, which then
issued a series of checks jointly payable to plaintiff,
defendant, and the contractor making repairs to cover the
loss. Id. ¶ 29. Plaintiff submitted the
insurance checks she received, totaling $156, 340.64, to
defendant. Id. ¶ 32. Defendant thereafter made
a series of payments to plaintiff's contractor totaling
$154, 340.64. Id. ¶ 33. Since 2012, defendant
has held the remaining $2, 000 in undisbursed insurance
funds, which it has failed to disclose to plaintiff.
Id. ¶ 35.
regularly provides monthly account statements that provide a
detailed breakdown of the principal due, interest due, escrow
due, overdue payments, current period fees and charges, and
unapplied funds to be credited to the account, each accurate
up to the cent. Id. ¶¶ 42-45. However,
these periodic statements have not disclosed the existence of
the property insurance funds or included any line item for
undisbursed insurance funds. Id.
March 26, 2015 and February 5, 2016, defendant issued payoff
statements to plaintiff claiming to reflect the amount
payable in order for defendant to release its lien on the
property. Id. ¶¶ 47, 49. The payoff
statements itemized the principal, interest, escrow, and
other fees due, with accuracy up to the cent. Id.
¶¶ 47-50, 55-56. The statements also included a
daily calculation of the amount that would be due in the
weeks before and after the expiration date of the payoff
statement, as well as a summary of upcoming expenses that
would be paid out of the escrow account. Id.
¶¶ 55-56. However, as with the periodic statements,
the payoff statements did not disclose the existence of the
undisbursed insurance funds. Id. ¶ 54. In
addition, the 2016 payoff statement included a "Payoff
Statement via Facsimile Fee" of $5.00, even though the
statement was sent by mail, and the BANA website states there
is no charge for sending the statement by mail. Id.
¶¶ 51-53, 86. Plaintiff did not request the
statement be sent via facsimile and does not own a fax
machine. Id. ¶¶ 51-52.
respect to plaintiff's injury, the complaint alleges
"Plaintiff has been harmed and has suffered an increased
cost or burden due to Defendant's actions . . . ."
Id. ¶ 80. Since 2012, plaintiff has been
concerned that her contractor overbilled her for unperformed
and shoddily performed work. Id. ¶¶ 36-37.
Plaintiff seeks information from defendant "to enable
her to know the details of all payments made and the funds
that have not been disbursed from her account."
Id. ¶ 37. In addition, if class members were to
apply for a loan modification or refinancing, if they wished
to fully satisfy their loan obligation, or if BANA attempted
foreclosure, the payoff statements would not provide an
accurate view of the outstanding balance. Id.
¶¶ 3, 72-75.
motion to dismiss under Federal Rule of Civil Procedure
12(b)(1) tests the court's subject matter jurisdiction.
See, e.g., Savage v. Glendale Union High
Sch., 343 F.3d 1036, 1039-40 (9th Cir. 2003). When a
party moves to dismiss for lack of subject matter
jurisdiction, "the plaintiff bears the burden of
demonstrating that the court has jurisdiction."
Boardman v. Shulman, No. 12-00639, 2012 WL 6088309,
at *2 (E.D. Cal. Dec. 6, 2012), aff'd sub nom.
Boardman v. C.I.R., 597 F.App'x 413 (9th Cir. 2015).
If a plaintiff lacks standing, the court lacks subject matter
jurisdiction under Article III of the U.S. Constitution.
Cetacean Cmty. v. Bush, 386 F.3d 1169, 1174 (9th
Rule 12(b)(6) of the Federal Rules of Civil Procedure, a
party may move to dismiss a complaint for "failure to
state a claim upon which relief can be granted." The
motion may be granted only if the complaint "lacks a
cognizable legal theory or sufficient facts to support a
cognizable legal theory." Hartmann v. Cal. Dep't
of Corr. & Rehab., 707 F.3d 1114, 1122 (9th Cir. 2013).
a complaint need contain only "a short and plain
statement of the claim showing that the pleader is entitled
to relief, " Fed.R.Civ.P. 8(a)(2), in order to survive a
motion to dismiss this short and plain statement "must
contain sufficient factual matter . . . to ‘state a
claim to relief that is plausible on its face.'"
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). A complaint must include something more than
"an unadorned, the-defendant-unlawfully-harmed-me
accusation" or "‘labels and conclusions'
or ‘a formulaic recitation of the elements of a cause
of action.'" Id. (quoting Twombly,
550 U.S. at 555). Determining whether a complaint will
survive a motion to dismiss for failure to state a claim is a
"context-specific task that requires the reviewing court
to draw on its judicial experience and common sense."
Id. at 679. Ultimately, the inquiry focuses on the
interplay between the factual allegations of the complaint
and the dispositive issues of law in the action. See
Hishon v. King & Spalding, 467 U.S. 69, 73 (1984).
making this context-specific evaluation, this court must
construe the complaint in the light most favorable to the
plaintiff and accept its factual allegations as true.
Erickson v. Pardus, 551 U.S. 89, 93-94 (2007). This
rule does not apply to "a legal conclusion couched as a
factual allegation, " Twombly, 550 U.S. at 555
(quoting Papasan v. Allain, 478 U.S. 265, 286
(1986)), "allegations that contradict matters properly
subject to judicial notice, " Sprewell v. Golden
State Warriors, 266 F.3d 979, 988-89 (9th Cir. 2001), or
material attached to or incorporated by reference into the
complaint, see Id. A court's consideration of
documents attached to a complaint, documents incorporated by
reference in the complaint, or matters of judicial notice
will not convert a motion to dismiss into a motion for
summary judgment. United States v. Ritchie, 342 F.3d
903, 907-08 (9th Cir. 2003); Parks Sch. of Bus. v.
Symington, 51 F.3d 1480, 1484 (9th Cir. 1995); cf.
Van Buskirk v. Cable News Network, Inc., 284 F.3d 977,
980 (9th Cir. 2002) (noting that even though court may look
beyond pleadings on motion to dismiss, generally court is
limited to face of the complaint on 12(b)(6) motion).
TILA and Regulation Z ...