United States District Court, N.D. California
JOSEPH R. WYMAN, LISA D. WYMAN, Plaintiffs,
FIRST AMERICAN TITLE INSURANCE COMPANY, WELLS FARGO BANK, N.A., as Trustee for Wells Fargo Asset Securities Corporation, Mortgage-Pass Through Certificates, Series 2006-AR18, WELLS FARGO BANK, N.A., and DOES 1 through 35, inclusive, Defendants.
ORDER GRANTING MOTION TO DISMISS
WILLIAM ALSUP UNITED STATES DISTRICT JUDGE.
wrongful foreclosure action, a bank defendant moves to
dismiss all claims asserted against it in pro se
plaintiffs' amended complaint. For the reasons stated
below, the motion is Granted.
2006, pro se plaintiffs Joseph Wyman and Lisa Wyman
recorded a mortgage loan in the amount of $704, 000 from
defendant Wells Fargo Bank secured by a deed of trust on real
property in Oakland (RJN, Exhs. A, B). The deed as recorded
identified Wells Fargo as the beneficiary, third-party
Fidelity National Title Insurance Company as the trustee, and
plaintiffs as the borrowers (RJN, Exh. B).
April 2011, Wells Fargo recorded an assignment of the deed of
trust to transfer and convey the beneficial interest in the
residence to third-party HSBC Bank USA, N.A., in its capacity
as trustee of a securitized trust. Wells Fargo remained the
servicing agent (RJN, Exh. C).
2012, Wells Fargo recorded a modification to plaintiffs'
loan (RJN, Exh. D). On May 17, 2016, Wells Fargo recorded a
substitution of trustee that changed the trustee for the loan
from Fidelity to First American Title Insurance Company (RJN,
Exh. E). On May 20, 2016, a notice of default was recorded,
the rescission of which was recorded shortly after (RJN,
Exhs. F, G).
November 17, 2016, Wells Fargo recorded a substitution of
trustee, substituting Clear Recon Corporation for First
American (RJN, Exh. H). On the same day, Clear Recon, in its
capacity as the appointed substituted trustee, recorded a new
notice of default noting plaintiffs' default on the loan
in the amount of $45, 791.84 as of November 14, 2016 (RJN,
date, no trustee's sale has occurred. Plaintiffs have not
indicated that they are ready to tender the unpaid portion of
November 2016, before Wells Fargo substituted Clear Recon as
trustee (but after First American rescinded the first notice
of default), plaintiffs commenced this action in Alameda
County Superior Court. Plaintiffs' theory was and remains
that Wells Fargo lacks beneficial interest in the deed. In
December 2016, defendant Wells Fargo removed the action to
federal court here in San Francisco based on diversity
jurisdiction (Dkt. No. 1). Following oral argument, this
Court granted Wells Fargo's motion to dismiss, holding
that plaintiffs lacked standing to challenge Wells
Fargo's right to foreclose and that plaintiffs'
claims are moot. The Court allowed plaintiffs to amend the
complaint, requesting a redlined copy to highlight the
changes (Dkt. No. 26). Plaintiffs filed their first amended
complaint, but failed to provide the requested redlined copy
(Dkt. No. 28).
Fargo now moves to dismiss the amended complaint (Dkt. No.
29). This order follows full briefing and oral argument.
seek to rescind “the loan and all accompanying loan
documents” and to permanently prevent the foreclosure
of the subject property by challenging Well Fargo's
standing to foreclose (Amd. Compl. ¶¶ 50-52, 148,
164). In addition, plaintiffs assert claims for predatory
lending, violations of the Homeowner's Bill of Rights and
the Business and Professions Code Section 17200 for unfair,
unlawful and fraudulent business practices, constructive
fraud, fraud in concealment and fraud in the inducement all
relating to Wells Fargo's alleged securitization of the
loan. In their initial complaint, plaintiffs' anchored
their claims in the allegation that the March 2011 assignment
of the deed of trust to HSBC Bank was unlawfully recorded so
that it therefore was “void and of no force and effect,
” that the May 2016 substitution of trustee from
Fidelity to First American was void, and that the May 2016
notice of default was “unlawfully recorded”
(Compl. ¶¶ 13-16). In their amended complaint,
plaintiffs shift gears and contend that the gravamen of their
claim to set aside any notice of trustee's sale is
predicated on the alleged violation of the California
Homeowner Bill of Rights (Amd. Compl. ¶ 3).
survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to state a claim
to relief that is plausible on its face. Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009). A claim is facially
plausible when there are sufficient factual allegations to
draw a reasonable inference that the defendant is liable for
the conduct alleged. While a court “must take all of
the factual allegations in the complaint as true, ” it
is “not bound to accept as true a legal conclusion
couched as a factual allegation.” Id. at
1949-50 (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007)) (internal quotation marks omitted).
“[C]onclusory allegations of law and ...