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Powell v. Wells Fargo Home Mortgage

United States District Court, N.D. California

June 23, 2017

WELLS FARGO HOME MORTGAGE, et al., Defendants.


          MARIA-ELENA JAMES United States Magistrate Judge.


         Defendant Wells Fargo Bank, N.A. ("Wells Fargo") moves to strike portions of Plaintiff Kayode Powell‘s Third Amended Complaint ("TAC") pursuant to Federal Rule of Civil Procedure 12(f). Mot., Dkt. No. 134; TAC, Dkt. No. 133. Plaintiff filed an Opposition (Dkt. No. 141) and Wells Fargo filed a Reply (Dkt. No. 141). The Court ordered the parties to submit supplemental briefing and vacated the hearing on this matter. Dkt. No. 145. Having considered the parties‘ positions, the record in this case, and the relevant legal authority, the Court GRANTS IN PART and DENIES IN PART Wells Fargo‘s Motion.


         The Court‘s Order re: Motions to Dismiss and Motion to Amend ("Order") sets forth a detailed background of this action. Order at 2-5, Dkt. No. 131. As is relevant here, Plaintiff initiated this action pro se in Alameda Superior Court against Wells Fargo and nine other Defendants.[1] See Compl., Dkt. No. 1-1 et seq. On September 19, 2014, Wells Fargo and HSBC removed the action to this Court. Notice of Removal, Dkt. No. 1.

         The parties engaged in motion practice, and on June 10, 2016, Plaintiff filed his Second Amended Complaint ("SAC"). Dkt. No. 105. He asserted six cause of action: (1) Negligence against Wells Fargo, HSBC, and First American; (2) violation of California's Rosenthal Fair Debt Collection Act against Wells Fargo and First American; (3) Breach of Contract against Wells Fargo and HSBC; (4) Fraud against Wells Fargo and HSBC; (5) Declaratory Relief against all Defendants; and (6) Rescission and Restitution against Wells Fargo and HSBC. See id.

         Wells Fargo and HSBC together moved to dismiss the SAC (WF Mot., Dkt. No. 109), as did First American (FA Mot., Dkt. No. 107). Before briefing concluded on the Motions to Dismiss, Plaintiff filed a Motion for Leave to File a TAC. See TAC Mot., Dkt. No. 113. Plaintiff‘s proposed TAC sought to add causes of action for (1) Wrongful Foreclosure based on the "wrong entity foreclosing" and "invalid substitution of trustee"; (2) a violation of California Unfair Competition Law ("UCL"), Cal. Bus. & Prof. Code § 17200; and (3) a violation of the Real Estate Settlement Practices Act ("RESPA"). See Proposed TAC, Dkt. No. 113-1.

         Addressing the Motions to Dismiss and the Motion for Leave to File a TAC, the Court dismissed (1) all claims based on challenges to the Assignment and transfer of the Loan, as the Court found Plaintiff did not have standing to challenge the securitization of his Loan; (2) the negligence claims against HSBC and First American; and (3) the Rosenthal Act, breach of contract, and fraud claims against all Defendants. Order at 7-27. The Court further dismissed Plaintiff‘s declaratory judgment and restitution claims. Id. at 27-28. The Court allowed Plaintiff‘s negligence and UCL claims against Wells Fargo to proceed and allowed him to file the TAC consistent with the Order. Id. at 18, 30. In so doing, the Court warned Plaintiff that it was "not grant[ing] Plaintiff leave to amend as to any of the other Defendants or to add any other claims O'Connell; John Kennerty (a Wells Fargo agent); Chet Sconyers (a Wells Fargo agent); and Hank Duong (a First American Agent). Compl. ¶ 4. The Court granted Plaintiff and Fidelity‘s Stipulation for Dismissal on December 24, 2014. Dkt. No. 31. On April 29, 2016, the Court dismissed the Doe Credit Reporting Agencies, Miles-Todd, O‘Connell, Kennerty, Sconyers, and Duong under Rule 4(m) as there was no indication they have been served. See Order re: Second Mots. to Dismiss at 40, Dkt. No. 100. The Court dismissed HSBC and First American with prejudice on March 3, 2017. Order. against Wells Fargo" and "w[ould] strike any pleading that does not comply with this Order." Id. at 30-31.

         In his TAC, Plaintiff asserts negligence and UCL claims against Wells Fargo. TAC ¶¶ 51-103. Plaintiff contends Wells Fargo deliberately mishandled his application for a loan modification by, among other things, repeatedly changing his single point of contact ("SPOC") and failing to effectively provide him with a SPOC, asking him to re-send documents, and failing to timely acknowledge receipt his application. Plaintiff alleges this "directly prevented [him] of the opportunity to modify his loan." Id. ¶ 58.

         Wells Fargo now seeks to strike portions of the TAC. Plaintiff, now represented by counsel, opposes the Motion.


         Federal Rule of Civil Procedure 12(f) allows a court to "strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." Immaterial matters are "those which ha[ve] no essential or important relationship to the claim for relief or the defenses being pleaded." Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993), rev'd on other grounds, 510 U.S. 517 (1994) (internal quotation marks omitted). Impertinent matters "do not pertain, and are not necessary, to the issues in question." Id. (internal quotation marks omitted).

         The purpose of a Rule 12(f) motion "is to avoid the expenditure of time and money that must arise from litigating spurious issues by dispensing with those issues prior to trial[.]" Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 973 (9th Cir. 2010) (internal quotation marks omitted). "Motions to strike are generally disfavored and 'should not be granted unless the matter to be stricken clearly could have no possible bearing on the subject of the litigation.‘" Luxul Tech. Inc. v. NectarLux, LLC, 2015 WL 4692571, at *3 (N.D. Cal. Aug. 6, 2015) (quoting Platte Anchor Bolt, Inc. v. IHI, Inc., 352 F.Supp.2d 1048, 1057 (N.D. Cal. 2004)). The decision to grant a motion to strike ultimately lies within the discretion of the trial court. Rees v. PNC Bank, N.A., 308 F.RD. 266, 271-72 (N.D. Cal. 2015) (citing Whittlestone, 618 F.3d at 973).


         Through their briefing, the parties have narrowed their scope of the Motion. Plaintiff "concedes that the Court has discretion to strike paragraphs 7-11, 13-14, 18-26, 31-36, 38-50, 93, 96, and 97." Id. at 5. Having reviewed these paragraphs, the Court finds they do not comply with the Court‘s Order or otherwise concern immaterial or impertinent matters. As such, the Court STRIKES paragraphs 7-11, 13-14, 18-26, 31-36, 38-50, 93, 96, and 97.

         In addition, "Wells Fargo no longer challenges, in its motion to strike, paragraph 27." WF Suppl. Br. at 2 n.1, 5. The Court therefore DENIES the Motion as to paragraph 27.

         Only the following portions of the TAC remain at issue: paragraphs 6, 12, 15-17, 28-30, 37, 95, and 103. Opp‘n at 4-5; Reply at 2, 5.

         A. Paragraphs 6, 12, 15, and 17

         Paragraphs 6, 12, 15, and 17 allege the following:

6. On December 20, 2005, for value received, Sandra L.
Thompson, Wells Fargo Bank, NA. Vice President Loan Documentation signed and had notarized an Assignment of the [Deed of Trust ("DOT")] assigning the loan to Wachovia Bank, N.A., as Trustee ("Wachovia"). The Assignment of DOT includes the Plaintiffs loan number for the loan encumbering the Subject Property and the address. The document declares that it was "prepared by and when recorded, return to Wells Fargo." The Assignment was not recorded. A true and correct copy of the Assignment is attached as Exhibit C.
12. On December 30, 2005 U.S. Bank completed the purchase of all of Wachovia Bank, N.A.‘s corporate trust services making U.S. Bank the trustee for any securitized trust for which ...

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