Martin v. Select Portfolio Servicing, Inc.

          ORDER DENYING PLAINTIFF’S APPLICATION FOR TEMPORARY RESTRAINING ORDER

          Troy L. Nunley United States District Judge

         This matter is before the Court on Plaintiff Renee L. Martin’s (“Plaintiff”) Amended Application for Temporary Restraining Order. (ECF No. 6.) The Court previously issued an Order (ECF No. 5) denying Plaintiff’s first Application for Temporary Restraining Order. In the Amended Application for Temporary Restraining Order, Plaintiff cites additional case law to support her motion. (ECF No. 6 at 3-4.) The Court has carefully considered Plaintiff’s Amended Application. For the reasons set forth below, Plaintiff’s application is hereby DENIED.

         I. FACTUAL BACKGROUND^[1]

         The Plaintiff is the owner of a property at 931 Oakbrook Drive, Fairfield, California 94534 (hereinafter “the Property”), acquired by a grant deed in 1988. (Compl., ECF No. 7 at ¶¶ 6, 13.) On or about December 9, 2004, Plaintiff refinanced the Property through WMC and “the loan was to be securitized in a trust known as Certificateholders of Morgan Stanley ABS Capital I Inc. Trust 2005-WMC3, Mortgage Pass-Through Certificate Series 2005-WMC3.” (ECF No. 7 at ¶¶ 3, 14.) At some point “during the financial crisis” the Plaintiff got behind in her mortgage payments. (ECF No. 7 at ¶ 3.) On or about September 1, 2012, a representative from Defendant Select Portfolio Servicing, Inc. (hereinafter “SPS”) contacted Plaintiff and informed her that SPS would be “taking over the loan.” (ECF No. 7 at ¶ 18.) Plaintiff advised the SPS representative that she was seeking a modification. (ECF No. 7 at ¶ 18.) Plaintiff alleges that she was advised by SPS to submit a “complete financial loan package for the modification, ” and that she did as requested. (ECF No. 7 at ¶ 18.)

         On October 19, 2012, a representative from SPS named Megan Koontz contacted Plaintiff to inform her that “a new (Department of Justice)” loan modification was available and recommended that Plaintiff apply for this program. (ECF No. 7 at ¶ 22.) Plaintiff was also informed that three trial payments would be required and that if she successfully made all three trial payments the loan would be permanently modified. (ECF No. 7 at ¶ 23.) On or about November 19, 2012, Plaintiff received a call from SPS notifying her that her loan modification request had been approved and her first of three trial payments in the amount of $1, 093.56 was due on December 1, 2012. Plaintiff received a letter from SPS, dated November 15, 2012, confirming the three payments of $1, 093.56 under the modification and stating that she could receive a principal reduction of $172, 828.37.^[2] (ECF No. 7 at ¶ 24.) Plaintiff claims to have made all three payments on time. (ECF No. 7 at ¶ 23.)

         On January 8, 2013, after making the three required payments, Plaintiff contacted SPS “to determine the exact amount of the remaining principal on the loan.” (ECF No. 7 at ¶ 25.) Plaintiff was told to contact “BAC^[3] for that information.” (ECF No. 7 at ¶ 25.) Plaintiff did contact BAC and was informed that as of August 12, 2012, the remaining principal balance of the loan was $278, 155. (ECF No. 7 at ¶ 25.) Plaintiff was also informed that “[the loan] was transfer[ed] to the new servicer, SPS[, ] for $278, 155 and that was the entire balance owed.” (ECF No. 7 at ¶ 25.) On February 8, 2013, Plaintiff contacted Megan Koontz at SPS and was advised that “she [would] be receiving the permanent modification any day now.” (ECF No. 7 at ¶ 27.)

         On March 4, 2013, Plaintiff again contacted SPS to inquire as to the status of her modification. (ECF No. 7 at ¶ 29.) Plaintiff spoke with SPS representative Jerison Sanchez who, according to Plaintiff, “attempted to misle[a]d Plaintiff and said that ‘since all of your three payments have been made timely, don’t do anything else, you don’t have to make any more payments, because we SPS will adjust everything to permanent status any day now.’” (ECF No. 7 at ¶ 29.) Plaintiff spoke to another SPS representative later in March and yet still no modification occurred. (ECF No. 7 at ¶ 30.) Plaintiff then received a letter from SPS dated June 24, 2013, stating that her home loan was not eligible for modification because “After being offered Modification, you did not return the permanent modification documents by the requested deadline.” (ECF No. 7 at ¶ 31; Exhibit 2 at 35.)

         Plaintiff contacted SPS within the required 30 days to object to the decision stating that she had never received a copy of any paperwork to sign. (ECF No. 7 at ¶¶ 32, 33.) At some point during this time, Plaintiff requested SPS provide her with a “Qualified Written Report” (QWR) because she was concerned about why her principal balance “kept dramatically increasing instead of decreasing[] when payments were made.” (ECF No. 7 at ¶ 35.) When Plaintiff received a package of information regarding the QWR from SPS, Plaintiff noticed among the papers a letter from SPS dated July 25, 2013. (ECF No. 7 at ¶ 36; Exhibit 3 at 32.) The July 25, 2013, letter informed Plaintiff that she was “approved for a principal reduction loan modification under the U.S. Department of Justice and State Attorneys General national mortgage settlement.” (ECF No. 7 at 32.) Plaintiff alleges that she never received this document prior to her QWR request. (ECF No. 7 at ¶ 36.) Plaintiff further alleges that “In the Loan Modification Agreement, [a] paragraph on the first page[] identifies SPS as (“Lender”) instead of servicer.” (ECF No. 7 at ¶ 37.) Plaintiff states that she “never entered into an agreement with SPS as lender, therefore, the lender of said loan, if any is WMC, not SPS.” (ECF No. 7 at ¶ 37.) Plaintiff believes that “SPS [] negligently misrepresented to Plaintiff that they are the lender and not the servicer of the loan.” (ECF No. 7 at ¶ 37.) Plaintiff alleges

there were gross deceptions in the modification, which Plaintiff did not agree to[, ] for instance: (a) ‘I acknowledge that I have been advised that I am eligible for evaluation for a modification under the U.S. Treasury Department’s Home Affordable Modification Program but I have voluntarily elected to proceed with this modification.’ This is false, as Plaintiff had met all criteria for the U.S. Treasury and had performed all the terms and conditions. (b) SPS, as servicer wrote themselves into the agreement as the Lender. In the chain of title, SPS is not or never had been in the chain as lender [(c)] Additionally, SPS wanted to deceive[] Plaintiff with a balloon payment after end in the amount of $24, 390.39. Balloon payments are contrary to any government modification plans.

(ECF No. 7 at ¶ 38.)

         Plaintiff alleges “SPS has been deceitful and moving forward to quickly foreclose because none of the defendants [] have any lawful right to the property, there is no debt owning on the subject property, which has been paid off through credits from government programs and by Plaintiff.” (ECF No. 7 at ¶ 39.) Plaintiff states that she continued to make her monthly payments in the amount of $1, 093.56 since December 1, 2012 to present, “even though SPS never fulfilled their agreement.” (ECF No. 7 at ¶¶ 28, 29.) Plaintiff claims her monthly loan payments for the months of May through October 2015 have all been returned by SPS and that SPS has sent regular correspondence requesting higher mortgage payments. (ECF No. 7 at ¶¶ 44, 46.) Plaintiff’s motion. (ECF No. 2 at 3.) Plaintiff contends that neither SPS nor Barrett Daffin Frappier Treder & Weiss, LLP^[4] (“Barrett”) are the lawful parties to conduct a trustee sale because the “chain of title is broken and there is no lender, the property is not in default and there is no debt owning on the subject property.” (ECF No. 7 at ¶ 47.)

         On August 8, 2016, Plaintiff filed an Amended Complaint in this Court alleging nine causes of action: (1) Violation of the Servicing of Mortgage Loans Procedures Act (12 U.S.C. § 2605); (2) violations of the U.S. Department of Justice and/or U.S. Department of Treasury (Modifications); (3) Wrongful Foreclosure (Commenced); (4) Violations of California Homeowners Bill of Rights; (5) Quiet Title to Real Property; (6) Intentional Infliction of Emotional Distress; (7) Fair Debt Collection Practices Act; (8) Violations of (Pooling Service Agreement); and (9) Negligent Misrepresentation. (ECF No. 7.)

         II. Legal Standard

         A temporary restraining order is an extraordinary and temporary “fix” that the court may issue without notice to the adverse party if, in an affidavit or verified complaint, the movant “clearly show[s] that immediate and irreparable injury, loss, or damage will result to the movant before the adverse party can be heard in opposition.” Fed.R.Civ.P. 65(b)(1)(A). The purpose of a temporary restraining order is to preserve the status quo pending a fuller hearing. See Fed. R. Civ. P. 65. It is the practice of this district to construe a motion for temporary restraining order as a motion for preliminary injunction. Local Rule 231(a); see also Aiello v. One West Bank, No. 2:10-cv-0227-GEB-EFB, 2010 WL 406092 at ...