United States District Court, E.D. California
PRISCILLA N. MOORE, Plaintiff,
FREEDOM MORTGAGE CORPORATION and NORTHWEST TRUSTEE SERVICES, INC., Defendants.
MEMORANDUM DECISION AND ORDER RE DEFENDANT'S
MOTION TO DISMISS (Doc. 3)
Lawrence J. O'Neill, UNITED STATES CHIEF DISTRICT JUDGE
PRELIMINARY STATEMENT TO PARTIES AND
in the Eastern District of California carry the heaviest
caseloads in the nation, and this Court is unable to devote
inordinate time and resources to individual cases and
matters. Given the shortage of district judges and staff,
this Court addresses only the arguments, evidence, and
matters necessary to reach the decision in this order. The
parties and counsel are encouraged to contact the offices of
United States Senators Feinstein and Harris to address this
Court's inability to accommodate the parties and this
action. The parties are required to reconsider consent to
conduct all further proceedings before a Magistrate Judge,
whose schedules are far more realistic and accommodating to
parties than that of U.S. Chief District Judge Lawrence J.
O'Neill, who must prioritize criminal and older civil
trials set before Chief Judge O'Neill trail until he
becomes available and are subject to suspension mid-trial to
accommodate criminal matters. Civil trials are no longer
reset to a later date if Chief Judge O'Neill is
unavailable on the original date set for trial. Moreover,
this Court's Fresno Division randomly and without advance
notice reassigns civil actions to U.S. District Judges
throughout the nation to serve as visiting judges. In the
absence of Magistrate Judge consent, this action is subject
to reassignment to a U.S. District Judge from inside or
outside the Eastern District of California.
case concerns a mortgage loan (“the Loan”)
Plaintiff Priscilla N. Moore obtained on the home she
previously owned (“the Property”) that was
secured by a deed of trust assigned to Defendant Freedom
Mortgage Corporation, and a non-judicial foreclosure sale on
the Property. Plaintiff brings eight claims against Defendant
under California statutory, contract, and tort law, and
Defendant moves to dismiss them entirely with prejudice.
See Doc. 3 at 3.
Court took the matter under submission on the papers pursuant
to Local Rule 230(g). Doc. 9. For the following reasons, the
Court GRANTS IN PART and DENIES IN PART Defendant's
motion to dismiss (Doc. 3).
FACTUAL AND PROCEDURAL BACKGROUND
2015, Plaintiff obtained the Loan. Doc. 1, Ex. 1, Complaint
(“Compl.”) ¶ 10. At some time in
“early 2016, ” Plaintiff began to suffer
financial problems, so she attempted to modify the terms of
the Loan. Id. ¶ 11. Specifically, Plaintiff
attempted to enter into a “trial period plan”
(“TPP”), which would make the terms of the Loan
more manageable for her. See Id. ¶ 8. Plaintiff
submitted to Defendant “a full and complete loan
modification application and supplementary financial
documents requested by Defendant.” Id. ¶
February 2016, however, Plaintiff had defaulted on the loan.
See Doc. 4, Ex. 4. In late February 2016, the deed
trustee, Defendant Northwest Trustee Services, Inc., filed a
“Notice of Default and Election to Sell under the Deed
of Trust” (“NTS”). See id.
in July 2016, Defendant informed Plaintiff that she had
qualified for a federally sponsored loan modification
program. Compl. ¶ 16. Defendant also sent Plaintiff a
written TPP, which set forth certain obligations related to
the Loan. Id. In particular, the TPP established a
three-month payment schedule that was set to begin in August
2016 that provided lower monthly payments than required under
the original terms of the Loan. Id. ¶ 17. The
TPP explained that Plaintiff would qualify for a permanent
loan modification if she timely made all three payments, and
further stated that Defendant would abstain from initiating
foreclosure proceedings if Plaintiff complied fully with the
TPP's terms. Id. ¶¶ 18-19, 31.
Plaintiff accepted the TPP, signed and returned a copy, and
furnished to the loan servicer a notification of acceptance,
all documents required for modification, and funds [for] each
and every month as required by the TPP.” Id.
¶ 20. Plaintiff fully complied with the TPP's terms
from August 2016 to January 2017. Id. ¶¶
January 2017, however, the Property was sold in a
non-judicial foreclosure sale. See Doc. 4, Ex. 6. In
February 2017, Defendant informed “Plaintiff that it
would no longer accept her mortgage payments, and that it
would not permanently modify the loan, and would not provide
her with a final modification agreement.” Id.
discussed in more detail below, Plaintiff alleges
Defendant's conduct was unlawful for several reasons.
Accordingly, Plaintiff brings eight claims against Defendant
for: (1) breach of contract; (2) promissory estoppel; (3)
violation of California Civil Code § 2923.6(c); (4)
violation of California Civil Code § 2924.18; (5)
violation of California Civil Code § 1788 et seq.
(a.k.a. “the Rosenthal Act”); (6) negligence; (7)
fraudulent misrepresentation; and (8) injunctive relief.
Compl. at 1. Defendant moves to dismiss each claim on the
ground that they fail as a matter of law.
STANDARD OF DECISION
motion to dismiss pursuant to Federal Rule of Civil Procedure
12(b)(6) is a challenge to the sufficiency of the allegations
set forth in the complaint. A 12(b)(6) dismissal is proper
where there is either a “lack of a cognizable legal
theory” or “the absence of sufficient facts
alleged under a cognizable legal theory.” Balisteri
v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir.
1990). In considering a motion to dismiss for failure to
state a claim, the court generally accepts as true the
allegations in the complaint, construes the pleading in the
light most favorable to the party opposing the motion, and
resolves all doubts in the pleader's favor. Lazy Y.
Ranch LTD v. Behrens, 546 F.3d 580, 588 (9th Cir. 2008).
survive a 12(b)(6) motion to dismiss, the plaintiff must, in
accordance with Rule 8, allege “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). “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.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009). “The plausibility
standard is not akin to a ‘probability requirement,
' but it asks for more than a sheer possibility that a
defendant has acted unlawfully.” Id. (quoting
Twombly, 550 U.S. at 556). “While a complaint
attacked by a Rule 12(b)(6) motion to dismiss does not need
detailed factual allegations, a Plaintiff's obligation to
provide the ‘grounds' of his ‘entitlement to
relief' requires more than labels and conclusions.”
Twombly, 550 U.S. at 555 (internal citations
omitted). Thus, “bare assertions . . . amount[ing] to
nothing more than a ‘formulaic recitation of the
elements' . . . are not entitled to be assumed
true.” Iqbal, 556 U.S. at 681. “[T]o be
entitled to the presumption of truth, allegations in a
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
practice, “a complaint . . . must contain either direct
or inferential allegations respecting all the material
elements necessary to sustain recovery under some viable
legal theory.” Twombly, 550 U.S. at 562.