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Kaping v. Barrett Daffin Frappier Treder & Weiss LLP

United States District Court, E.D. California

June 8, 2017

FRED KAPING, Plaintiff,



         Defendants' request for judicial notice (ECF No. 6), motion to dismiss (ECF No. 4), and motion to strike (ECF No. 5) came on regularly for hearing on May 31, 2017. Pro se plaintiff Fred Kaping appeared on behalf of himself. James Lee appeared telephonically for defendant Barrett Daffin Frappier Treder & Weiss, LLP (“BDFTW”). Leigh Curran appeared telephonically for defendant Wells Fargo Bank, N.A. (“Wells Fargo”). Upon consideration of the arguments made, review of the documents in support and opposition and good cause appearing therefore, THE COURT FINDS AS FOLLOWS:

         I. Relevant Background[1]

         On August 27, 2007, plaintiff executed a secured promissory note and Deed of Trust for $633, 000.00, secured by the property located at 1365 Shadow Rock Ct., Auburn, CA 95602. The Deed of Trust was recorded in the Placer County Recorder's Office on September 5, 2007 by World Savings Banks, F.S.B. (“World”). By plaintiff's own admission, Wells Fargo notified him through the U.S. mail that it “was the recipient of the Mortgage by a ‘successor-in-interest' claim under [World].” (ECF No. 1 at 27.) BDFTW, as the appointed trustee under the Deed of Trust, recorded a Notice of Default on March 11, 2016 and a Notice of Trustee's Sale on July 11, 2016. Plaintiff acknowledged before this court on May 31, 2017 that he has not tendered the balance of the Deed of Trust.

         On February 17, 2017, plaintiff filed a complaint in Placer County Superior Court, alleging various federal and state causes of action for: (1) violation of the Fair Debt Collection Practices Act; (2) violation of the Truth in Lending Act; (3) violation of the California Rosenthal Act; (4) violation of the California unfair competition law; (5) cancellation of instruments under California law; (6) negligence; (7) slander of title; and (8) quiet title. Each claim is based upon the theory that the original Deed of Trust is void because it was the product of an illegal “table-funded” loan, [2] and that this Deed of Trust was subsequently assigned to Wells Fargo improperly.

         Defendants filed a notice of removal on March 31, 2017. (ECF No. 1.) On April 4, 2017, defendant Wells Fargo filed the motions currently before the court. (ECF Nos. 4-6.) Plaintiff opposed each motion. (ECF No. 8.) Defendant BDFTW joined in each motion. (ECF Nos. 10, 11.) Wells Fargo replied to plaintiff's opposition. (ECF No. 13).

         II. Defendants' Request for Judicial Notice

         In connection to their motion to dismiss, defendants request judicial notice of various documents. (ECF No. 6, Exs. 1-6.) In ruling on a motion to dismiss pursuant to Rule 12(b), the court “may generally consider only allegations contained in the pleadings, exhibits attached to the complaint, and matters properly subject to judicial notice.” Outdoor Media Group, Inc. v. City of Beaumont, 506 F.3d 895, 899 (9th Cir. 2007). “The court may judicially notice a fact that is not subject to reasonable dispute because it: (1) is generally known within the trial court's territorial jurisdiction; or (2) can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Fed.R.Evid. 201(b).

         A. Exhibits 1 and 2

         Exhibit 1 is a copy of plaintiff's Adjustable Rate Mortgage Note, dated August 27, 2007. Exhibit 2 is a copy of the Deed of Trust from the same date. Plaintiff argues that he “disputes the facts contained within the instruments, and their legal meaning” and that defendants have failed to provide “any authenticity for the veracity in which the documents were created.” (ECF No. 8 at 24.) However, he does not claim that Exhibit 1 or 2 are not true copies of his Mortgage Note or Deed of Trust. Nor does he point to any specific errors in the documents. Importantly, nothing in Exhibit 1 or 2 contradicts anything in plaintiff's complaint or opposition memorandum. Moreover, the Mortgage Note and Deed of Trust are public records and easily verifiable.

         Judicial notice of Exhibits 1 and 2 is appropriate, because they are central to plaintiff's complaint and are not subject to reasonable dispute. See Fed.R.Evid. 201(b); Gamboa v. Tr. Corps, No. 09-0007 SC, 2009 WL 656285, at *3 (N.D. Cal. Mar. 12, 2009) (taking judicial notice of a Deed of Trust and adjustable rate mortgage note, when ruling on a motion to dismiss because “[t]hese documents are central to Plaintiffs' allegations that Defendants were not entitled to initiate a foreclosure sale of their property. These documents are also part of the public record and are easily verifiable”).

         B. Exhibits 3 through 6

         Defendants also request judicial notice of documents evidencing Wells Fargo as the successor in interest to World. Specifically, a certificate of corporate existence issued by the Office of Thrift Supervision (“OTS”) regarding World (Exhibit 3); a letter authorizing a name change from World to Wachovia on OTS letterhead (Exhibit 4); an official certification of the Comptroller of Currency confirming Wachovia's conversion to a national bank and merger with and into Wells Fargo (Exhibit 5); and a printout from the website of the Federal Deposit Insurance Corporation, showing the history of World and its transition to Wells Fargo (Exhibit 6). This court has previously taken notice of the same documents in Exhibits 3 through 5 and the fact that Wells Fargo is World's successor by merger. See Curry v. Wells Fargo Bank, N.A., 2014 U.S. Dist. LEXIS 123609, *3-4 (E.D. Cal. Sept. 2, 2014); Catherine v. Wells Fargo Bank, NA, 2016 U.S. Dist. LEXIS 96904, *4-5 (E.D. Cal. July 22, 2016) (“Wells Fargo is attempting to collect a debt originated by World Savings, which it succeeded by merger”).

         Plaintiff fails to address this court's prior judicial notice of these same documents. He only makes the same general claim that he disputes these documents and that they are not properly authenticated. ECF No. 8. As this court has previously taken judicial notice of these exact documents, judicial notice of Exhibits 3 through 5 is appropriate. See Fed.R.Evid. 201(b); Curry, 2014 U.S. Dist. LEXIS 123609 at *3-4.

         Exhibit 6, on the other hand, is a purported printout from the Internet that does not include any official letterhead or other designation, such as a URL web address, that would tend to self-authenticate its veracity. Since its veracity is subject to reasonable dispute, judicial notice of Exhibit 6 is not appropriate.[3]

         III. Defendants' Motion to Dismiss

         A motion to dismiss brought pursuant to Federal Rule of Civil Procedure 12(b)(6) challenges the sufficiency of the pleadings set forth in the complaint. Vega v. JPMorgan Chase Bank, N.A., 654 F.Supp.2d 1104, 1109 (E.D. Cal. 2009). Under the “notice pleading” standard of the Federal Rules of Civil Procedure, a plaintiff's complaint must provide, in part, a “short and plain statement” of plaintiff's claims showing entitlement to relief. Fed.R.Civ.P. 8(a)(2); see also Paulsen v. CNF, Inc., 559 F.3d 1061, 1071 (9th Cir. 2009). “To 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) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id.

         In considering a motion to dismiss for failure to state a claim, the court accepts all of the facts alleged in the complaint as true and construes them in the light most favorable to the plaintiff. Corrie v. Caterpillar, Inc., 503 F.3d 974, 977 (9th Cir. 2007). The court is “not, however, required to accept as true conclusory allegations that are contradicted by documents referred to in the complaint, and [the court does] not necessarily assume the truth of legal conclusions merely because they are cast in the form of factual allegations.” Paulsen, 559 F.3d at 1071. The court must construe a pro se pleading liberally to determine if it states a claim and, prior to dismissal, tell a plaintiff of deficiencies in her complaint and give plaintiff an opportunity to cure them if it appears at all possible that the plaintiff can correct the defect. See Lopez v. Smith, 203 F.3d 1122, 1130-31 (9th Cir. 2000) (en banc); accord Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990) (“pro se pleadings are liberally construed, particularly where civil rights claims are involved”); see also Hebbe v. Pliler, 627 F.3d 338, 342 & n.7 (9th Cir. 2010) (courts continue to construe pro se filings liberally even when evaluating them under the standard announced in Iqbal).

         A. Plaintiff's Legal Conclusions

         Plaintiff's arguments rest upon two fatally erroneous legal conclusions that he attempts to present as factual allegations: (1) that World improperly table-funded his original loan in violation of Cal. Bus. & Prof. Code § 10234, which thereby rendered the Deed of Trust void as an illegal contract, and (2) that World failed to record its assignment of the Deed of Trust to Wells Fargo. (ECF No 1.)

         1. Cal. Bus. & Prof. Code ยง 10234 ...

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