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Davis v. Citimortgage, Inc.

United States District Court, C.D. California

April 4, 2018

J.D. DAVIS, Plaintiff,
CITIMORTGAGE, INC.; CLEAR RECON CORP.; and DOES 1-25, inclusive, Defendants




         Before the Court are (1) Defendant CitiMortgage, Inc.'s (“CitiMortgage”) Motion to Dismiss Plaintiff J.D. Davis's Second Amended Complaint (“SAC”) (Mot. to Dismiss (“MTD”), ECF No. 36), and (2) Intervenor Wilshire Investment Group, LLC's (“Wilshire”) Motion to Expunge Lis Pendens and Claim for Attorney Fees and Costs. (Mot. to Expunge (“MTE”), ECF No. 35.) For the reasons below, the Court GRANTS CitiMortgage's Motion to Dismiss and GRANTS Wilshire's Motion to Expunge Lis Pendens.[1]


         Plaintiff's claims arise from a home mortgage loan secured against a property in Los Angeles, California (the “Property”). (Second Amended Complaint (“SAC”), ECF No. 33.) Plaintiff obtained the mortgage loan from Coast 2 Coast Funding Group, Inc. on June 16, 2009. (Id. at 9.) Plaintiff defaulted on the loan in, or around, January 2010. (Id. at 9.) CitiMortgage subsequently acquired the loan in, or around, April 2010. (Id. at 10.) Clear Recon Corporation (“Clear Recon”), acting as trustee under the deed of trust, executed and subsequently recorded a Notice of Default on the loan on March 7, 2017. (Id. at 12.) On June 19, 2017, Clear Recon executed and recorded a Notice of Trustee's sale. (Id. at 12.) The Property was sold at a trustee's sale on August 3, 2017. (Id. at 12.) Wilshire purchased the Property at the trustee's sale. (Trustee's Deed Upon Sale (“TDUS”), Ex. H, ECF No. 33.)

         Plaintiff initiated this case against CitiMortgage and Clear Recon in Los Angeles County Superior Court on August 11, 2017. (See Not. Removal, Ex. A, ECF No. 1-1.) CitiMortgage removed the case to this Court on September 18, 2017. (Not. Removal.) On September 25, 2017, CitiMortgage moved to dismiss Plaintiff's Complaint pursuant to Federal Rules of Civil Procedure 8 and 12(b)(6). (ECF No. 10.) In response, on October 18, 2017, Plaintiff filed a First Amended Complaint (“FAC”). (FAC, ECF No. 12.) CitiMortgage moved to dismiss again (ECF No. 24), and on February 1, 2018, the Court granted the motion. (Order, ECF No. 32.) The Court granted the Motion as to each cause of action but permitted Plaintiff leave to amend as to all claims except the cause of action brought under section 3118 of the California Commercial Code. (Order 6.) On February 16, 2018, Plaintiff filed the Second Amended Complaint (“SAC”), alleging claims for (1) violation of section 1692f(b) of the Fair Debt Collection Practices Act (“FDCPA”); (2) wrongful foreclosure; (3) violation of California Civil Code section 2934a; (4) cancellation of instruments; (5) negligent misrepresentation; and (6) violation of California Business and Professions Code section 17200 (“UCL”). (See generally SAC.)

         Clear Recon has not appeared in this action, and Plaintiff has not submitted any evidence that Clear Recon has been served. The Court granted Wilshire's application to intervene in this action on November 15, 2017. (ECF No. 22.) CitiMortgage now moves to dismiss Plaintiff's SAC in its entirety (see MTD), and Wilshire moves to expunge lis pendens. (See MTE.)


         A. Motion to Dismiss

         A court may dismiss a complaint under Rule 12(b)(6) for lack of a cognizable legal theory or insufficient facts pleaded to support an otherwise cognizable legal theory. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990). To survive a motion to dismiss, a complaint need only satisfy the minimal notice pleading requirements of Rule 8(a)(2)-a short and plain statement of the claim. Porter v. Jones, 319 F.3d 483, 494 (9th Cir. 2003). The factual “allegations must be enough to raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). That is, the 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).

         The determination whether a complaint satisfies the plausibility standard is a “context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Id. at 679. A court is generally limited to the pleadings and must construe all “factual allegations set forth in the complaint . . . as true and . . . in the light most favorable” to the plaintiff. Lee v. City of L.A., 250 F.3d 668, 688 (9th Cir. 2001). But a court need not blindly accept conclusory allegations, unwarranted deductions of fact, and unreasonable inferences. Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001). However, for a pro se plaintiff, the complaint is to be liberally construed and “must be held to less stringent standards than formal pleadings drafted by lawyers.'” Erickson v. Pardus, 551 U.S. 89, 94 (2007).

         Where a district court grants a motion to dismiss, it should provide leave to amend unless it is clear that the complaint could not be saved by any amendment. Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008) (“Dismissal without leave to amend is improper unless it is clear . . . that the complaint could not be saved by any amendment.”). Leave to amend, however, “is properly denied . . . if amendment would be futile.” Carrico v. City & Cnty. of San Francisco, 656 F.3d 1002, 1008 (9th Cir.2011).

         B. Motion to Expunge

         The California statutory lis pendens scheme extends to the federal district courts. Cal. Civ. Proc. Code § 405.5; Formula, Inc. v. Superior Court, 168 Cal.App.4th 1455, 1463 n.9 (2008). Thus, “[f]ederal courts look to state law regarding matters pertaining to lis pendens.” Balagapo v. GMAC Mortg., LLC, No. 2:09-cv-00405-JAM-GGH, 2010 WL 144108, at *1 (E.D. Cal. Jan. 8, 2010) (citing 28 U.S.C. § 1964). Courts in this district apply California law when ruling on a motion to expunge a lis pendens. Ritchie v. Cmty. Lending Corp., No. CV 09-02484 DDP ...

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