United States District Court, S.D. California
ORDER GRANTING DEFENDANT NATIONSTAR MORTGAGE
LLC'S MOTION TO DISMISS; AND [DOC. NO. 4] GRANTING IN
PART AND DENYING AS MOOT IN PART DEFENDANT NATIONSTAR
MORTGAGE LLC'S REQUEST FOR JUDICIAL NOTICE [DOC. NO.
MICHAEL M. ANELLO UNITED STATES DISTRICT JUDGE
Maria Diaz (“Plaintiff”) filed a Complaint
against Defendants Nationstar Mortgage LLC
(“Nationstar”) and Clear Recon Corp. in the
Superior Court for the County of San Diego alleging five
causes of action for: (1) violations of the Fair Debt
Collection Practices Act (“FDCPA”), 15 U.S.C.
§ 1692f(6); (2) violations of §§ 1692 et
seq. of the FDCPA; (3) violations of California Civil
Code § 2934(a)(1)(A); (4) cancellation of instruments;
and (5) violations of California's Unfair Competition Law
(“UCL”). See Doc. No. 1-2 (hereinafter
“Complaint”). On August 9, 2017, Defendants
removed the action to this Court. See Doc. No. 1.
Nationstar moves to dismiss Plaintiff's Complaint for
failure to state a claim pursuant to Federal Rule of Civil
Procedure 12(b)(6). Doc. No. 4. Plaintiff filed an opposition
to Nationstar's motion, to which Nationstar replied.
See Doc. Nos. 5, 7. The Court found the matter
suitable for determination on the papers and without oral
argument pursuant to Civil Local Rule 7.1.d.1. See
Doc. No. 9. For the reasons set forth below, the Court
GRANTS Nationstar's motion to dismiss.
30, 2003, Plaintiff obtained a loan from Home Equity Mortgage
in the amount of two hundred seventy-six thousand and five
hundred dollars ($276, 500.00) to purchase the real property
located at 1010 Beechglen Dr., Chula Vista, California,
91910. Complaint at 2, 15. The loan was secured by a deed of
trust. Complaint at 15; Doc. No. 12 at 43. Home Equity
Mortgage recorded the Deed of Trust and Promissory Note with
the San Diego Recorder's office. Complaint at 15. In May
2010, Plaintiff fell behind on her payments. Complaint at 16.
In May 2011, former servicer, Bank of America, executed and
recorded a Notice of Default on Plaintiff's property.
Complaint at 17; Doc. No. 12 at 66.
2011, Mortgage Electronic Registration Systems, Inc. executed
a Corporation Assignment of Deed of Trust assigning all
beneficial interest to The Bank of New York Mellon FKA The
Bank of New York as Trustee for the Certificateholders of
CWMBS, Inc., The Alternative Loan Trust 2003-20CB Mortgage
Pass-Through Certificates, Series 2003-51 (“BONY as
Trustee of the 2003-20CB Trust”). Complaint at 17; Doc.
No. 12 at 70. Plaintiff alleges the Corporation Assignment of
Deed of Trust “conveyed no interest to the alleged debt
because it was executed by one without authority, ”
“executed outside of the four corners of the agreement
that governs the 2003- 20CB Trust, ” and
“assigned when the debt was in default.”
Complaint at 17. On March 21, 2013, Plaintiff filed for
Chapter 7 bankruptcy. See Doc. No. 4-1 (hereinafter
“RJN”), Exh. 10. The Bankruptcy Court discharged
Plaintiff's debt on June 26, 2013. RJN, Exh. 12.
2015, another Assignment of Deed of Trust assigned all
beneficial interest to BONY as Trustee of the 2003-20CB
Trust. Complaint at 17; Doc. No. 12 at 71. As with the first
Corporation Assignment of Deed of Trust, Plaintiff alleges
the assignment “did not convey any interest to BONY as
Trustee of the 2003-20CB Trust because it was executed by one
without authority, executed outside of the four corners of
the agreement that governs the 2003-20CB Trust, and assigned
when the debt was in default.” Complaint at 17.
December 2016, Defendant Clear Recon Corp. executed and
recorded a Notice of Default on Plaintiff's property.
Complaint at 18; Doc. No. 12 at 73. Plaintiff alleges Clear
Recon Corp. is not “either the original trustee, duly
appointed substituted trustee[, ] or agent of the holder of
the beneficial interest under” the 2003 Deed of Trust.
Complaint at 18.
April 2017, Clear Recon Corp. recorded a Notice of
Trustee's Sale. Complaint at 19; Doc. No. 12 at 78. On
June 7, 2017, Plaintiff was notified that the debt ownership
was transferred to NRZ Pass-Through Trust IV c/o Citibank.
Complaint at 18; Doc. No 12 at 77. In May 2017, Specialized
Loan Servicing, LLC, who acquired the debt, informed
Plaintiff that it would transfer the debt servicing to
Nationstar. Complaint at 16. On June 27, 2017, Nationstar
notified Plaintiff that it acquired the servicing of
Plaintiff's debt effective June 16, 2017. Complaint at
16; Doc. No 12 at 61. On July 14, 2017, Plaintiff filed for
Chapter 13 bankruptcy. RJN, Exh. 13. The Bankruptcy Court
dismissed the case without prejudice on July 31, 2017. RJN,
alleges that Nationstar now attempts to proceed with a
non-judicial foreclosure, prohibited by the FDCPA. Complaint
at 13, 16. Additionally, “since acquiring the servicing
of the alleged debt, ” Nationstar “has been
harassing Plaintiff by attempting to collect a debt”
and “engag[ing] in other unlawful collection
practices[.]” Complaint at 16, 22.
upon these allegations, Plaintiff commenced the instant
action against Defendants on July 21, 2017 alleging: (1)
violations of Section 1692f(6) of the FDCPA; (2) violations
of Sections 1692 et seq. of the FDCPA; (3)
violations of California Civil Code § 2934a(1)(A); (4)
cancellation of instruments; and (5) violations of the UCL.
See Complaint at 20-29.
Request for Judicial Notice
a district court's review on a 12(b)(6) motion to dismiss
is “limited to the complaint.” Lee v. City of
Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001)
overruled on other grounds by Galbraith v. Cnty. Of Santa
Clara, 307 F.3d 1119, 1125-26 (9th Cir. 2002) (quoting
Cervantes v. City of San Diego, 5 F.3d 1273, 1274
(9th Cir. 1993)). However, “a court may take judicial
notice of matters of public record, ” id. at
689 (internal quotations omitted), and of “documents
whose contents are alleged in a complaint and whose
authenticity no party questions, but which are not physically
attached to the pleading, ” Branch v. Tunnell,
14 F.3d 449, 454 (9th Cir. 1994), overruled on other
grounds by Galbraith, 307 F.3d at 1125-26; see
also Fed. R. Evid. 201. “A judicially noticed fact
must be one not subject to reasonable dispute in that it is
either (1) generally known within the territorial
jurisdiction of the trial court or (2) capable of accurate
and ready determination by resort to sources whose accuracy
cannot reasonably be questioned.” Fed.R.Evid. 201(b);
see also Mack v. South Bay Beer Distributors, 798
F.2d 1279, 1282 (9th Cir. 1986) (citing Sears, Roebuck
& Co. v. Metropolitan Engravers, Ltd., 245 F.2d 67,
70 (9th Cir. 1956)).
12(b)(6) motion to dismiss tests the sufficiency of the
complaint. Navarro v. Block, 250 F.3d 729, 732 (9th
Cir. 2001). A pleading must contain “a short and plain
statement of the claim showing that the pleader is entitled
to relief.” Fed.R.Civ.P. 8(a)(2). However, plaintiffs
must also plead “enough facts to state a claim to
relief that is plausible on its face.” Fed.R.Civ.P.
12(b)(6); Bell Atl. Corp. v. Twombly, 550 U.S. 544,
570 (2007). The plausibility standard thus demands more than
a formulaic recitation of the elements of a cause of action,
or naked assertions devoid of further factual enhancement.
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Instead, the complaint “must contain allegations of
underlying facts sufficient 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).
reviewing a motion to dismiss under Rule 12(b)(6), courts
must assume the truth of all factual allegations and must
construe them in the light most favorable to the nonmoving
party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336,
337-38 (9th Cir. 1996). The court need not take legal
conclusions as true merely because they are cast in the form
of factual allegations. Roberts v. Corrothers, 812
F.2d 1173, 1177 (9th Cir. 1987). Similarly, “conclusory
allegations of law and unwarranted inferences are not
sufficient to defeat a motion to dismiss.” Pareto
v. FDIC, 139 F.3d 696, 699 (9th Cir. 1998).
determining the propriety of a Rule 12(b)(6) dismissal,
courts generally may not look beyond the complaint for
additional facts. United States v. Ritchie, 342 F.3d
903, 908 (9th Cir. 2003). “A court may, however,
consider certain materials-documents attached to the
complaint, documents incorporated by reference in the
complaint, or matters of judicial notice-without converting
the motion to dismiss into a motion for summary
judgment.” Id.; see also Lee, 250
F.3d at 688. “However, [courts] are not required to
accept as true conclusory allegations which are contradicted
by documents referred to in the complaint.”
Steckman v. Hart Brewing, Inc., 143 F.3d 1293,
1295-96 (9th Cir. 1998). Where dismissal is appropriate, a
court should grant leave to amend unless the plaintiff could
not possibly cure the defects in the pleading.
Knappenberger v. City of Phoenix, 566 F.3d 936, 942
(9th Cir. 2009).
Nationstar's Request for Judicial Notice
requests the Court take judicial notice of various documents
in support of its motion to dismiss. See RJN.
Plaintiff filed an opposition to Nationstar's request for
judicial notice, arguing that the “proffered documents
are disputed and constitute inadmissible hearsay.”
Doc. No. 6 at 3. Specifically, Nationstar requests the Court
take judicial notice of the following fourteen (14)
1. Exhibit 1 - Deed of Trust, recorded on July 7, 2003;
2. Exhibit 2 - Assignment of Deed of Trust, recorded on
October 20, 2003;
3. Exhibit 3 - Notice of Default and Election to Sell Under
Deed of Trust, recorded on May 23, 2011;
4. Exhibit 4 - Substitution of Trustee, recorded on July 5,
5. Exhibit 5 - Corporation of Assignment of Deed of Trust,