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Bustos v. Chase Bank N.A.

United States District Court, S.D. California

April 19, 2017

LINDA B. BUSTOS, Plaintiff,
CHASE BANK N.A., Defendant.



         This matter is before the Court on Defendant JPMorgan Chase Bank, N.A.'s (“JPMorgan”) motion to dismiss Plaintiff Linda B. Bustos's (“Bustos”) third amended complaint.[1] (Doc. No. 28.) The Court finds the matter suitable for disposition on the papers, without oral argument, pursuant to Local Civil Rule 7.1.d.1. Accordingly, the hearing date currently set for May 4, 2017, is hereby VACATED. For the reasons set forth below, the Court GRANTS JPMorgan's motion and DISMISSES this case WITHOUT LEAVE TO AMEND.


         The Court assumes this dispute arises from JPMorgan's foreclosure or attempted foreclosure of Bustos's residence. The Court makes this assumption based on the sparse allegations contained in prior iterations of the complaint[2] because the TAC contains only two factual allegations: (1) JPMorgan “did not follow the strict rules of The Dodd Frank Act”; and (2) Bustos “never rejected any offer from” JPMorgan. (Doc. No. 26 at 1-2.) Bustos seeks $75, 000 in damages for “the action of [JPMorgan, ] which causes mental, physical, and emotional stress, sleepless nights with the idea of the possibility of her losing her home.” (Id. at 2-3.)

         Bustos instituted this lawsuit on April 7, 2016, by filing the original complaint. (Doc. No. 1.) Because Bustos sought leave to proceed in forma pauperis, (Doc. No. 2), the Court screened the complaint pursuant to 28 U.S.C. § 1915 and found it failed to state a claim, (Doc. No. 3). Thus, the Court dismissed the complaint with leave to amend and denied as moot Bustos's IFP application. (Doc. No. 3.) Bustos was given sixty days from that order's issuance to file an amended complaint. (Id. at 4.)

         On May 16, 2016, Bustos paid the filing fee. (Doc. No. 4.) She then apparently served an amended complaint on JPMorgan on May 31, 2016, but did not file it with the Court. (Doc. No. 7-2 ¶ 4.) JPMorgan successfully moved to dismiss the unfiled amended complaint on June 21, 2016. (Doc. Nos. 7, 12.)

         Bustos filed the second amended complaint on August 11, 2016. (Doc. No. 13.) JPMorgan again successfully moved to dismiss the complaint. (Doc. Nos. 15, 16, 22.) The Court required Bustos to file a third amended complaint no later than December 2, 2016. (Doc. No. 22 at 8.) When that deadline came and went without an amendment filed, the Court sua sponte extended the deadline to February 3, 2017. (Doc. No. 25.) Bustos filed the now operative TAC on January 12, 2017. (Doc. No. 26.) On January 20, 2017, JPMorgan filed the instant motion to dismiss. (Doc. No. 28.) The motion has been fully briefed. (Doc. Nos. 32, 33.) This order follows.

         Legal Standard

         A Rule 12(b)(6) motion to dismiss tests the legal sufficiency of the complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). A pleading must contain “a short and plain statement of the claim showing that the pleader is entitled to relief . . . .” Fed.R.Civ.P. 8(a)(2). Plaintiffs must also plead, however, “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). The plausibility standard thus demands more than a formulaic recitation of the elements of a cause of action or naked assertions devoid of further factual enhancement. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Instead, the complaint “must contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively.” Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011).

         In reviewing a motion to dismiss under Rule 12(b)(6), courts must assume the truth of all factual allegations and must construe them in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). The court need not take legal conclusions as true “merely because they are cast in the form of factual allegations.” Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir. 1987) (quoting W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981)). Similarly, “conclusory allegations of law and unwarranted inferences are not sufficient to defeat a motion to dismiss.” Pareto v. Fed. Deposit Ins. Corp., 139 F.3d 696, 699 (9th Cir. 1998).

         Where dismissal is appropriate, a court should freely grant leave to amend. Knappenberger v. City of Phoenix, 566 F.3d 936, 942 (9th Cir. 2009). However, where it is “absolutely clear that the deficiencies of the complaint could not be cured by amendment, ” the action must be dismissed without leave to amend. Broughton v. Cutter Labs., 622 F.2d 458, 460 (9th Cir. 1980) (per curiam).


         JPMorgan again asks the Court to dismiss Bustos's complaint with prejudice. JPMorgan predicates its request on the fact that the complaint has devolved to the point of incoherence, containing absolutely no factual allegations to provide it or the Court notice of what Bustos's claims and injuries are. This time, the Court agrees that dismissal without leave to amend is appropriate.

         In its last order dismissing the SAC for failing to state a claim, the Court determined Bustos sufficiently pleaded that she sent a loan modification package to JPMorgan and that JPMorgan failed to respond within five days of receipt. (Doc. No. 22 at 6-7.) However, the Court noted one deficiency that was fatal to her 12 C.F.R. § 1024.41(b)[3] claim: Bustos failed to allege when a foreclosure sale was scheduled. (Id. at 7.) The Court stated that § 1024.41(b)(2)(i) required Bustos to have sent her loan modification package to JPMorgan “45 days or more before a foreclosure sale[.]” 12 C.F.R. § 1024.41(b)(2)(i). Accordingly, failing to include when the foreclosure sale was scheduled was “fatal to the SAC's sufficiency.” (Doc. No. 22 at 7.) See also Thomas v. Wells Fargo Bank, N.A., No. 3:15-CV-02344-GPC-JMA, 2016 WL 1701878, at *5 (S.D. Cal. Apr. 28, 2016) (“By [its] plain terms, § 1024.41(b) applies where a servicer receives a loss mitigation application ‘45 days or more before a foreclosure ...

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