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Agredano v. Capital One, National Assocation

United States District Court, N.D. California

July 16, 2019

Salvador Agredano, Plaintiff,
Capital One, National Association, et al., Defendants.



         This is the second round of briefing on the complaint filed by pro se plaintiff Salvador Agredano against defendants Capital One, N.A. (“Capital One”) and Real Time Resolutions, Inc. (“Real Time”). On April 11, 2019, the Court entered an order granting defendants' motions to dismiss with leave to amend, except insofar as his claims were based on the allegation that GreenPoint Mortgage Funding, Inc. (“GreenPoint”) was not a legally active corporation at the time it assigned its interest in plaintiff's debt to Real Time. (Dkt. No. 50 (“Order”) at 15.) On May 13, 2019, plaintiff filed an amended complaint, re-alleging causes of action for (1) violation of the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2605; (2) violation of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692; (3) fraud; and (4) misrepresentation. (Dkt. No. 51 (“FAC”), ¶¶ 14-49.)[1]

         Having carefully considered the pleadings in this action and the papers submitted, [2] the Court finds as follows:

         1. RESPA Claim Against Real Time

         In its prior order, the Court granted Real Time's motion to dismiss plaintiff's RESPA claim on grounds that plaintiff (1) failed to plead actual harm causally connected to the alleged RESPA violations, and (2) failed to explain how Real Time's failure to respond to plaintiff's QWR caused any alleged harm. (Order at 7-9.)[3]

         In his amended complaint, plaintiff newly alleges that he suffered actual damages because Real Time “reported incorrect information to the credit bureaus, which [] cause[d] [p]laintiff to be denied refinancing options on three separate occasions.” (FAC ¶ 21.) Although negative credit reports alone generally do not constitute actual damages for purposes of stating a RESPA claim, see Petrovich v. Ocwen Loan Servicing, LLC, 2015 WL 3561821, at *2 (N.D. Cal. June 8, 2015), allegations that plaintiff was denied specific refinancing opportunities as a result of said credit reports suffices to show actual damages. See Anokhin v. BAC Home Loan Servicing, LP, No. 2:10-CV-00395, 2010 WL 3294367, at *3 (E.D. Cal. Aug. 20, 2010) (“To constitute actual damages, the negative credit rating must itself cause damage to the plaintiff as evidenced by, for example, failing to qualify for a home mortgage.”); Hutchinson v. Delaware Sav. Bank FSB, 410 F.Supp.2d 374, 382 (D.N.J. 2006) (plaintiffs adequately alleged damages under RESPA where they alleged that defendants continued to report late payments to credit bureaus after receiving QWRs, damaging plaintiffs' credit and precluding them from obtaining other loans); cf., Stoimenova v. Select Portfolio Servicing, No. 5:15-CV-01504-RMW, 2015 WL 4880943, at *4 (N.D. Cal. Aug. 14, 2015) (plaintiff failed to allege actual damages in support of RESPA claim where he did not “allege that he suffered actual pecuniary harm from the negative [credit] reporting”).

         Further, drawing all reasonable inferences in plaintiff's favor, it is plausible that Real Time's “fail[ure] to provide an accounting to justify the balance it claims [it] is owed” caused the alleged damages. For example, had Real Time timely and adequately responded to plaintiff's QWR, plaintiff could have taken additional steps to correct any inaccuracies, thereby preventing Real Time from reporting allegedly incorrect information to credit bureaus. See Johnson v. HSBC Bank USA, Nat. Ass'n, 3:11-CV-2091-JM-WVG, 2012 WL 928433, at *6 (S.D. Cal. Mar. 19, 2012) (where plaintiff alleged that defendant failed to provide a substantive response to QWR, causing confusion over how much plaintiff actually owed, defendant's failure to respond to the QWR plausibly caused harm).[4]

         Thus, the Court finds that the allegations in the FAC are sufficient to state a RESPA claim against Real Time at this stage in the proceedings. Thus, Real Time's motion to dismiss plaintiff's RESPA claim is Denied.

         2. RESPA Claim Against Capital One

         The Court's prior order identified three specific deficiencies in plaintiff's RESPA claim against Capital One: (1) Plaintiff failed to allege that Capital One was the servicer of the loan such that it would be obligated to respond to the QWR under RESPA; (2) plaintiff did not allege facts demonstrating how Capital One's response to plaintiff's QWR was insufficient; and (3) plaintiff failed to allege recoverable damages. (Order at 9-10.)

         In the FAC, plaintiff cures the first deficiency by alleging that “Real Time and Capital One were servicers of the Loan within the meaning of RESPA.” (FAC ¶ 15.) Plaintiff does not, however, cure the second deficiency. Rather, plaintiff merely re-alleges the following in support of his RESPA claim against Capital One:

On or about August 18, 2018, Plaintiff sent a written correspondence to Capital One constituting a “qualified written response” in an attempt to obtain a proper accounting of the funds paid towards the Mortgage. The qualified written request pertained to the servicing of the loan because it sought an accounting and documentation to justify the balance that Real Time claims is owed on the Mortgage. Capital One did not provide a response until August 22, 2018.

(FAC ¶ 18.) The FAC contains no other factual allegations regarding the substance of Capital One's QWR response. Further, although plaintiff alleges that “Defendant [] failed to respond in a proper and timely way” to his QWRs and “the response was not responsive to the requests made by Plaintiff” (id. ¶ 20), plaintiff does not specify the defendant(s) to which these allegations apply, and in any event, such allegations, without more, are far too general to support the RESPA claim.

         As to the third deficiency, that is, plaintiff's failure to allege recoverable damages, plaintiff has supplemented his damages allegations to demonstrate a plausible theory of harm based on his loss of refinancing opportunities. (FAC ¶ 22.) However, without any explanation as to how Capital One's QWR response was ...

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