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Selby v. Ocwen Loan Servicing, LLC

United States District Court, S.D. California

November 16, 2017




         Defendant Ocwen Loan Servicing, LLC (“Ocwen”) has filed two motions: (1) a motion to stay this case pending a ruling from the United States Court of Appeals for the D.C. Circuit [Doc. No. 11]; and (2) a motion to dismiss for lack of standing and failure to state a claim [Doc. No. 30]. The motions have been fully briefed, and the Court deems them suitable for submission without oral argument. For the following reasons, the motion to dismiss is granted with respect to Plaintiff's lack of standing, the motion to stay is denied as moot, and Plaintiff is ordered to show cause as to subject matter jurisdiction over the state law claims.

         I. Background

         Plaintiff filed her original complaint on May 11, 2017. The original complaint asserted claims for negligent and intentional violations of the Telephone Consumer Protection Act (the “TCPA”), claims under both the federal Fair Debt Collection Practices Act (the “FDCPA”) and California's Rosenthal Fair Debt Collection Practices Act (the “Rosenthal Act”), and common law claims for negligence and negligence per se. [Doc. No. 1.] The original complaint named three defendants: (1) Ocwen Mortgage Servicing, Inc.; (2) Ocwen Loan Servicing, LLC; and (3) JPMorgan Chase Bank, N.A. (“JPMorgan”), as trustee for Bear Stearns ALT-A Trust, Mortgage Pass-Through Certificates, Series 2004-13. The two Ocwen defendants filed motions to dismiss the original complaint and to stay this litigation pending a decision in ACA International v. FCC, No. 15-1211 (D.C. Cir.).

         Instead of opposing the motion to dismiss, Plaintiff voluntarily dismissed Ocwen Mortgage Servicing, Inc. and filed a first amended complaint (“FAC”) against only Ocwen and JPMorgan. The FAC asserted the same claims except for the negligence per se claim. Once again, Ocwen moved to dismiss the FAC, and once again, instead of opposing the motion to dismiss, Plaintiff amended her complaint. The second amended complaint (“SAC”), which remains the operative pleading, names only Ocwen as a defendant and asserted only the two TCPA claims, the Rosenthal Act claim, and a negligence claim.

         According to the SAC, in 2004, Plaintiff borrowed money secured by real property located in San Diego, California (the “Mortgage”). The property was not Plaintiff's primary residence, and the proceeds from the Mortgage were used for “personal, family, and household purposes.” [Doc. No. 29 at ¶ 18.] ¶ 2009, Plaintiff's attorney “sent a written notice of representation to Bank of America, which at the time was the servicer of the Mortgage.” [Id. at ¶ 19.] At some point before 2013, the Mortgage went into default. [Id. at ¶ 20.] ¶ 2013, Ocwen took over servicing the Mortgage from Bank of America. [Id.] Plaintiff's attorney sent a letter dated September 20, 2013, “notifying Ocwen of its violations of state and federal debt collection laws and re-affirming that Plaintiff was represented by counsel.” [Id. at ¶ 22.]

         Between November 20, 2014 and August 11, 2016, Ocwen called Plaintiff's cellular telephone 1008 times using an automatic telephone dialing system (“ATDS”) in an effort to collect on the Mortgage debt. [Id. at ¶¶ 27, 35.] The SAC alleges that Plaintiff “did not provide express consent to Defendant to receive calls on [her] cellular telephone, ” and that she “clearly revoked any type of express consent, if prior express consent ever existed, by stating that [she] no longer wished to be contacted by phone.” [Id. at ¶¶ 29, 31.] Ocwen's collection calls allegedly caused Plaintiff frustration and distress, “disrupted [her] daily activities and the peaceful enjoyment of [her] personal and professional life, including the ability to use [her] phone, ” and caused her to miss “important communications from friends and family.” [Id. at ¶¶ 41-43.]

         Ocwen now moves to dismiss Plaintiff's TCPA claims under Federal Rule of Civil Procedure 12(b)(1) for lack of standing, and the state law claims under Rule 12(b)(6) for failure to state a claim.

         II. Standing to Sue for TCPA Violations

         A. Legal Standards for Dismissal Under Rule 12(b)(1)

         Standing under Article III pertains to the Court's subject matter jurisdiction and therefore is “properly raised in a motion to dismiss under Federal Rule of Civil Procedure 12(b)(1).” White v. Lee, 227 F.3d 1214, 1242 (9th Cir. 2000). “For purposes of ruling on a motion to dismiss for want of standing, both the trial and reviewing courts must accept as true all material allegations of the complaint and must construe the complaint in favor of the complaining party.” Maya v. Centex Corp., 658 F.3d 1060, 1068 (9th Cir. 2011) (quoting Warth v. Seldin, 422 U.S. 490, 501 (1975)).

         The standing to sue doctrine is derived from Article III of the Constitution's limitation of the judicial power of federal courts to “actual cases or controversies.” Spokeo v. Robins, __ U.S. __, 136 S.Ct. 1540, 1547, 194 L.Ed.2d 635 (2016) (citing Raines v. Byrd, 521 U.S. 811, 818, 117 S.Ct. 2312, 138 L.Ed.2d 849 (1997)). “The doctrine limits the category of litigants empowered to maintain a lawsuit in federal court to seek redress for a legal wrong.” Id. “[T]he ‘irreducible constitutional minimum' of standing consists of three elements. The plaintiff must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision.” Id. (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992)). “The party invoking federal jurisdiction bears the burden of establishing these elements.” Lujan, 504 U.S. at 561 (internal citations omitted).

         The first element, injury in fact, “is a constitutional requirement, and ‘it is settled that Congress cannot erase Article III's standing requirements by statutorily granting the right to sue to a plaintiff who would not otherwise have standing.'” Spokeo, 136 S.Ct. at 1547-48 (quoting Raines, 521 U.S. at 820, n. 3, 117 S.Ct. 2312). “To establish injury in fact, a plaintiff must show that he or she suffered ‘an invasion of a legally protected interest' that is ‘concrete and particularized' and ‘actual or imminent, not conjectural or hypothetical.'” Id. at 1548 (quoting Lujan, 504 U.S. at 560, 112 S.Ct. 2130). “‘For an injury to be “particularized, ' it ‘must affect the plaintiff in a personal and individual way.'” Id. (quoting Lujan, 504 U.S. at 560, n.1, 112 S.Ct. 2130). Meanwhile, “[a] ‘concrete' injury must be ‘de facto'; that is, it must actually exist.” Id. (citing Black's Law Dictionary 479 (9th ed. 2009)). Therefore, a plaintiff does not “automatically satisf[y] the injury-in-fact requirement whenever a statute grants a person a statutory right and purports to authorize that person to sue to vindicate that right. Article III standing requires a concrete injury even in the context of a statutory violation.” Id. at 1549. A “bare procedural violation, divorced from any concrete harm, ” does not satisfy the injury-in-fact requirement of Article III. Id.

         B. ...

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