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Lopez v. Wells Fargo Bank, N.A.

United States District Court, S.D. California

April 5, 2017



          Hon. Anthony J. Battaglia, United States District Judge

         Presently before the Court is Defendants WELLS FARGO BANK, N.A. (also sued as Wells Fargo Home Mortgage) ("Wells Fargo") and U.S. BANK NATIONAL ASSOCIATION'S ("US Bank") (collectively "Defendants") motion to dismiss Fernando Lopez's ("Plaintiff) second amended complaint ("SAC"). (Doc. No. 33.) Also pending is Defendant FIRST AMERICAN TITLE INSURANCE COMPANY'S ("First American") motion to dismiss the SAC. (Doc. No. 32.) The Court finds these motions suitable for determination on the papers and without oral argument in accordance with Civil Local Rule 7.1.d.1. For the reasons set forth more fully below, the Court GRANTS Defendants' and First American's motions to dismiss.

         I. BACKGROUND

         A. General Allegations

         The following facts are taken from the SAC and construed as true for the limited purpose of resolving the pending motions. See Moyo v. Gomez, 40 F.3d 982, 984 (9th Cir. 1994). In 2003, Plaintiff purchased real property located at 947 Merced River Road, Chula Vista, California 91913 (the "Property"). (Doc. No. 31 ¶ 9.) In 2004, Plaintiff executed a loan (the "Loan") with Wells Fargo. (Id.) The Loan was secured by a Deed of Trust in favor of Wells Fargo, encumbering the Property ("Deed of Trust"). (Id. ¶ 10.) On June 16, 2005, Wells Fargo placed the Loan into a "Pooling and Servicing Agreement" and converted it into stock as Wells Fargo Mortgage-Backed Securities ("Trust"). (Id. ¶ 11.)

         In 2009, Plaintiff requested a loan modification from Wells Fargo. (Id. ¶¶ 26-27.) Wells Fargo then advised Plaintiff to stop making timely loan payments. (Id. ¶ 27.) Plaintiff complied and as a result defaulted on the Loan. (Id.) On November 17, 2009, a Notice of Default was recorded against the Property. (Id. ¶ 30.) In 2010, Plaintiff filed a Chapter 13 Bankruptcy Petition. (Id. ¶ 27.)

         On December 22, 2009, First American was recorded as the substitution trustee under the Deed of Trust. (Id. ¶ 31.) Plaintiff alleges that this document was not signed by Wells Fargo but signed by Chet Sconyers who is the Vice President at First American Trustee Servicing and is allegedly involved in the robo-signing of loan and mortgage documents. (Id.) The beneficial interest of the Deed of Trust was then transferred by assignment to U.S. Bank on January 6, 2010. (Id. ¶ 32.) On June 5, 2012, a Notice of Trustee Sale was recorded and on April 3, 2013, a Notice of Default and election to sell under the Deed of Trust was recorded. (Id. ¶¶ 34-35.) Subsequently, First American recorded a Notice of Trustee Sale on July 1, 2013. (Id. ¶ 35.) Plaintiff claims that this document was executed by rubber stamp and the signor's signature is illegible. (Id.) On September 16, 2014, Plaintiff sent a Notice of Validation of Alleged Debt to First American. (Id. ¶ 36.) On June 11, 2015, Plaintiff filed another Chapter 13 petition. (Id. ¶ 40.) As of the date of this filing, the Property has not yet been sold. (See generally id.)

         In sum, Plaintiff alleges that his loan was underwritten without proper due diligence and that Wells Fargo illegally or deceptively qualified Plaintiff for a loan they should have known that Plaintiff could not afford.[1] (Id. ¶¶ 20-21.) Furthermore, Plaintiff argues that First American and Defendants unlawfully assigned, and transferred their ownership and security interest in Plaintiffs home. (Id. at 2.)[2] As a result, Plaintiff contends that Defendants and First American intentionally and negligently foreclosed on Plaintiffs property with no authority to do so. (Id. ¶ 42.)

         B. Procedural History

         On April 5, 2016, Plaintiff filed a complaint against Defendants and First American asserting several claims for relief. (Doc. No. 1.) On April 26, 2016, Defendants filed a motion to dismiss for failure to state a claim. (Doc. No. 8.) On May 23, 2016, First American filed a motion to dismiss for failure to state a claim and for lack of subject matter jurisdiction. (Doc. No. 12.) On July 1, 2016, the Court dismissed the complaint for lack of subject matter jurisdiction and denied as moot Defendants and First American's motions to dismiss. (Doc. No. 19.) On July 28, 2016, Plaintiff filed his first amended complaint ("FAC"). (Doc. No. 20.) Thereafter, on August 10, and 16, 2016, First American and Defendants moved to dismiss Plaintiffs FAC. (Doc. Nos. 21, 23.) On November 23, 2016, the Court granted Defendants and First American's motions to dismiss Plaintiffs FAC without prejudice. (Doc. No. 30.) Plaintiffs claims under the Truth in Lending Act, Fair Housing Act, and Equal Credit Opportunity Act were dismissed with prejudice. (Id. at 22.)

         On December 7, 2016, Plaintiff filed his SAC. (Doc. No. 31.) Plaintiff alleges the following causes of actions against Defendants and First American: (1) lack of standing to foreclose; (2) fraud in concealment and inducement; (3) violation of the Rosenthal Fair Debt Collection Practices Act ("Rosenthal Act"); (4) violation of the Real Estate Settlement Procedures Act ("RESPA"); (5) intentional infliction of emotional distress ("IIED"); (6) slander of title; (7) unlawful and fraudulent business practice; (8) violation of Homeowners Bill of Rights ("HBOR"); (9) quiet title; and (10) declaratory relief. (Id. at 1.) On December 22 and 23, 2016, First American and Defendants moved to dismiss Plaintiffs SAC. (Doc. Nos. 32, 33.) Plaintiff filed a single opposition to both Defendants' and First American's motions to dismiss. (Doc. No. 39.).


         A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of a plaintiffs complaint and allows a court to dismiss a complaint upon a finding that the plaintiff has failed to state a claim upon which relief may be granted. See Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). "[A] court may dismiss a complaint as a matter of law for (1) lack of a cognizable legal theory or (2) insufficient facts under a cognizable legal claim." SmileCare Dental Grp. v. Delta Dental Plan of Cal, Inc., 88 F.3d 780, 783 (9th Cir. 1996) (citation omitted). However, a complaint will survive a motion to dismiss if it contains "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). In making this determination, a court reviews the contents of the complaint, accepting all factual allegations as true, and drawing all reasonable inferences in favor of the nonmoving party. Cedars-Sinai Med. Ctr. v. Nat'l League of Postmasters of U.S., 497 F.3d 972, 975 (9th Cir. 2007).

         Notwithstanding this deference, the reviewing court need not accept "legal conclusions" as true. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). It is also improper for a court to assume "the [plaintiff] can prove facts that [he or she] has not alleged." Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 519, 526 (1983). However, "[w]hen there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Iqbal, 556 U.S. at 679.


         A. Judicial Notice

         The Court first turns to Defendants and First American's request for judicial notice pursuant to Federal Rule of Evidence 201. (Doc. Nos. 32-2, 33-4.) Defendants and First American request the Court take judicial notice of several documents of public record including a grant deed, deed of trust, assignment of deed of trust, several notices of default and election to sell, notice of trustee sale, and copies of U.S. Bankruptcy court case files. (Id.)

         While, "as a general rule, a district court may not consider materials not originally included in the pleadings in deciding a Rule 12 motion ... it may take judicial notice of matters of public record and consider them without converting a Rule 12 motion into one for summary judgment." U.S. v. 14.02 Acres of Land, 547 F.3d 943, 955 (9th Cir. 2008) (quotation and citations omitted). Plaintiff contends First American's request for judicial notice should be denied because the documents are in dispute and constitute inadmissible hearsay.[3] (Doc. No. 39 at 13-18.) In support of this argument Plaintiff cites to Willis v. State of Cal., 22 Cal.App.4th 287 (1994), and Neighborhood Assistance Corp. of Am. v. First One Lending Corp., No. SACV 12-463 DOC (MLGx), 2012 WL 1698368 (CD. Cal. May 15, 2012). However, the Court highlights that the facts of those cases are inapposite to the present matter. In Willis, 22 Cal.App.4th at 291, the plaintiff simply requested judicial notice without presenting the court a certified copy. Similarly in Neighborhood Assistance Corp. of Am., 2012 WL 1698368, at * 11, the court held that the facts defendants requested judicial notice of were not generally known, and the alleged facts were based only on information from defendants' website.

         Here, Defendants and First American request the Court take judicial notice of official records of the County of San Diego, and copies of U.S. Bankruptcy Court documents. Thus, as these are documents that are matters of public record, the Court finds judicial notice appropriate. See, e.g., Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001); Lingadv. Indymac Fed. Bank, 682 F.Supp.2d 1142, 1146 (E.D. Cal. 2010); Tiqui v. First Nat'l Bank of Arizona, No. 09cvl750 BTM (BLM), 2010 WL 1345381, at *1 n.2 (S.D. Cal. Apr. 5, 2010). Moreover, Plaintiff references the documents in his complaint, and the Court has already taken judicial notice of the documents at issue in its Order dated November 23, 2016. (Doc. No. 30 at 6.) See Tekle v. United States, No. CV 01-11096 RSWL EX., 2002 WL 1988178, at *3 (CD. Cal. 2002) (holding that a court may take judicial notice of a prior complaint with exhibits). Accordingly, First American's request for judicial notice and Defendants' unopposed request for judicial notice are GRANTED.

         B. Plaintiffs Objections

         Next as a procedural matter, the Court will turn to Plaintiffs objections to the documents submitted by First American. (Doc. No. 39 at 20.) Plaintiff asks the Court to strike First American's Exhibits A-P for various reasons including: (1) that the documents constitute inadmissible hearsay; (2) they lack foundation; and (3) they are irrelevant to the matter at hand. (See generally, Doc. No. 39 at 20-26.) The Court notes that it acknowledges that Plaintiff disputes the validity of the documents that First American requests judicial notice of.[4] Therefore, the Court will take judicial notice of the documents not for the truth of the facts recited therein, but only for the existence of the documents filed. Accordingly, the Court DENIES Plaintiffs objections in whole.[5]

         C. Lack of Factual Specificity

         The Court first notes that Plaintiff only filed a single opposition brief in response to both First American's and Defendants' motions to dismiss. (Doc. No. 39.) Additionally and most importantly for purposes of this motion, Plaintiffs opposition groups all three Defendants together without distinguishing between them. Therefore, the ...

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