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Lac v. Nationstar Mortgage LLC

United States District Court, E.D. California

July 26, 2016

NELSON LAC, Plaintiff,
NATIONSTAR MORTGAGE LLC, et al., Defendants.


         Defendant Nationstar Mortgage LLC asks the court to reconsider its decision to award plaintiff Nelson Lac his attorneys’ fees under California Civil Code section 2924.12. The court held a hearing on June 3, 2016. Aldon Bolanos appeared for Lac. Jered Ede and Timothy Burnett appeared for Nationstar. The motion is denied.[1]

         I. BACKGROUND

         In 2006, Nelson Lac obtained a mortgage loan. See Request for Judicial Notice Ex. L, ECF No. 67. In 2008, Lac’s construction business closed, and he fell behind on his mortgage payments. Lac Decl. ¶ 3, ECF No. 56-2. Nationstar began servicing Lac’s loan in July 2013 and is the loan’s current servicer. See Janati Decl. ¶¶ 2, 5, ECF No. 66-1.

         Lac filed a complaint in this court on March 9, 2015. ECF No. 1. He alleged Nationstar ignored several requests for a loan modification his attorney made in 2014. Id. ¶¶ 3-6. He also alleged Nationstar falsely claimed to have tried diligently to contact him before a notice of default was recorded in December 2014. Id. ¶ 7. He requested damages, declaratory relief, an equitable accounting, interest, attorneys’ fees, and costs. Id. at 7-8.

         Nationstar did not timely file a responsive pleading, so in September of last year, Lac moved for the entry of Nationstar’s default, ECF No. 12, and applied ex parte for a temporary restraining order, notifying the court a foreclosure sale had been scheduled for mid-October. TRO Appl. at 3, ECF No. 13. The court set a hearing on the motion and instructed Lac’s attorney, Mr. Bolanos, to contact Nationstar and notify it of Lac’s application and the hearing. ECF No. 15. The docket reflects Bolanos complied with that order. ECF No. 16.

         In October 2015, Nationstar appeared in this action by filing a belated motion to dismiss. ECF No. 17. A few days later, the court held a hearing on Lac’s ex parte application. Minutes, ECF No. 23. Following a discussion with counsel, the court issued an order granting the application for a temporary restraining order as unopposed and enjoining any foreclosure sale for sixty days. Order Oct. 14, 2015, ECF No. 24. The court also struck Nationstar’s untimely motion to dismiss and instructed the Clerk’s Office to enter Nationstar’s default. ECF No. 30.

         Soon after his request for a TRO was granted, Lac requested an award of the attorneys’ fees he incurred in obtaining the temporary restraining order, citing California Civil Code section 2924.12. ECF No. 36. At the time, as described above, Nationstar had not timely appeared, and its default had not been set aside, so it filed no opposition. The court awarded Lac attorneys’ fees of $6, 660. See Order at 6-8 (citing Cal. Civ. Code § 2924.12 and Monterossa v. Superior Court of Sacramento Cty., 237 Cal.App.4th 747, 753, 757 (2015)), ECF No. 61. In the same order, the court set aside Nationstar’s default. Id. at 4-6. Nationstar now moves for reconsideration of the fee award. ECF No. 69. Lac opposes the motion. ECF No. 79.

         Nationstar’s reply brief was filed late, four days before hearing, and is three pages longer than this court’s standing order allows. See E.D. Cal. L.R. 230(d) (“Not less than seven (7) days preceding the date of hearing, the moving party may serve and file a reply to any opposition filed by a responding party.”); Standing Order at 4, ECF No. 6-1 (“Replies shall not exceed ten (10) pages. Only in rare instances and for good cause shown will the court grant an application to extend these page limitations.”). The reply brief is therefore stricken.

         After Nationstar’s motion to reconsider was filed, the court denied Lac’s motion for a preliminary injunction, finding he was unlikely to succeed on the merits of his claims. ECF No. 86. The court also dismissed Lac’s original complaint under Federal Rule of Civil Procedure 12(b)(6), allowing him leave to amend. ECF No. 94. Lac filed an amended complaint in June 2016. ECF No. 97. He now asserts five claims against Nationstar: (1) pursuing a foreclosure sale while considering his application for a loan modification in violation of California Civil Code section 2923.6; (2) providing him no single point of contact in violation of California Civil Code section 2923.7; (3) not acknowledging receipt of his loan modification application in violation of California Civil Code section 2924.10; (4) negligently mishandling his modification application; and (5) engaging in unfair business practices in violation of California Business and Professions Code section 17200.


         Nationstar asks this court to reconsider its previous order awarding attorneys’ fees. “As long as a district court has jurisdiction over [a] case, then it possesses the inherent procedural power to reconsider, rescind, or modify an interlocutory order for cause seen by it to be sufficient.” City of Los Angeles v. Santa Monica BayKeeper, 254 F.3d 882, 885 (9th Cir. 2001) (citation, quotation marks, and emphasis omitted). In addition, Rule 54(b) of the Federal Rules of Civil Procedure authorizes courts to revise “any order or other decision . . . that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties . . . at any time before the entry of a judgment adjudicating all the claims and all the parties’ rights and liabilities.” Fed.R.Civ.P. 54(b).

         Reconsideration is appropriate where it is necessary to correct clear error or prevent manifest injustice, where new evidence has become available, or where there has been an intervening change in controlling law. Cachil Dehe Band of Wintun Indians v. California, 649 F.Supp.2d 1063, 1069 (E.D. Cal. 2009) (citing Sch. Dist. No. 1J Multnomah Cty. v. AC&S Inc., 5 F.3d 1255, 1263 (9th Cir. 1993)). Under Local Rule 230(j), the party moving for reconsideration must explain:

(1) when and to what [j]udge . . . the prior motion was made; (2) what ruling . . . was made thereon; (3) what new or different facts or circumstances are claimed to exist which did not exist or were not shown upon such prior motion, or what other grounds exist for the motion; and (4) why the facts or circumstances were not shown at the time of the prior motion.

E.D. Cal. L.R. 230(j). “To succeed, a party must set forth facts or law of a strongly convincing nature to induce the court to reverse its prior decision.” Knight v. Rios, No. 09-00823, ...

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