United States District Court, C.D. California
Attorneys Present for Defendants: Eric Mercer
Attorneys Present for Plaintiffs: David Newman
Present: The Honorable CHRISTINA A. SNYDER, Judge
CIVIL MINUTES - GENERAL
FARGO BANK, N.A.'S MOTION FOR SUMMARY JUDGMENT (ECF No.
41, filed October 2, 2019)
MOTION FOR SUMMARY JUDGMENT (ECF No. 44, filed October 4,
case arises out of plaintiffs Walter H. Hackett III and
Lorinda D. Hackett's attempts to modify and/or request
information regarding the terms of their home loan with their
lender, defendant Wells Fargo Bank, N.A. ("Wells
Fargo" or "the bank"). In general, the
Hacketts allege that Wells Fargo failed to comply with
federal regulations requiring federally-insured lenders to
provide adequate notices to prospective borrowers within
established timeframes following the receipt of certain
Hacketts filed their first complaint in this Court on October
6, 2017. See ECF No. 1 ("Compl."). The
complaint asserted a claim for relief pursuant to the Equal
Credit Opportunity Act ("ECOA"), 15 U.S.C. §
1691(d)(1), two claims for relief pursuant to the Real Estate
Settlement Procedures Act ("RESPA"), 12 U.S.C.
§ 2605(f), a claim for negligence pursuant to California
law, as well as a claim pursuant to California Business and
Professions Code § 17200, the California Unfair
Competition Law ("UCL"). On March 4, 2018, the
Court granted the bank's motion to dismiss the
Hacketts' ECOA, negligence, and UCL claims, but denied
the motion as to the RESPA claims. See ECF No. 24
("First MTD Order").
Hacketts filed their first amended complaint
("FAC") on April 4, 2018. See ECF No. 25.
The FAC asserts the same five claims for relief that were
previously alleged in the complaint. On June 25, 2018, the
Court granted the bank's motion to dismiss the FAC as to
the Hacketts' negligence claim, but denied the motion as
to the Hacketts' other claims for relief. See
ECF No. 31 ("Second MTD Order"). The four surviving
claims for relief contained within the FAC-(1) the ECOA claim
(which arises from two separate alleged violations), (2-3)
the RESPA claims, and (4) the UCL claim-comprise the
operative pleading before the Court.
Fargo moved for summary judgment, or in the alternative,
partial summary judgment on all four of the Hackett's
remaining claims on October 2, 2019. See ECF No. 41
("Bank's MSJ"). On October 4, 2019, the
Hacketts filed their own motion for summary judgment, or
partial summary judgment, on one of the violations alleged in
their ECOA claim and one of their RESPA claims. See ECF No.
44 ("Hacketts' MSJ"). On October 11, 2019, the
Bank filed its opposition to the Hacketts' motion, as
well as a statement of genuine disputes in response to the
Hacketts' asserted undisputed facts. See ECF No.
46 ("Bank's Opp."), ECF No. 46-3
("BSGD"). The Hacketts filed their opposition to
the bank's motion on October 15, 2019, as well as their
own statement of genuine disputes. See ECF No. 47
("Hacketts' Opp."), ECF No. 47-1
("HSGD"). The parties filed replies on October 21,
2019. See ECF No. 48 ("Bank's Reply"), ECF No.
51 ("Hacketts' Reply").
hearing was held at which both parties appeared on November
4, 2019. Having considered the parties arguments, the Court
finds and concludes as follows.
following facts are not materially disputed and are set forth
for purposes of background. Unless otherwise noted, the Court
references only facts that are uncontroverted and as to which
evidentiary objections have been overruled.
The Hacketts' Loan And Related
Hacketts own a home in West Covina, California, where they
live. HSGD ¶ 1. In June 2006, the Hacketts refinanced
their home loan with Pinnacle Financial. Id. Wells
Fargo began servicing that loan shortly afterward, and the
bank remains the servicer of that loan to this day. HSGD
¶ 2. In 2010, the Hacketts defaulted on the loan by
failing to make two loan payments, totaling approximately $6,
000. HSGD ¶ 3. That same year, the Hacketts filed the
first of several bankruptcy petitions. BSGD ¶ 2. The
final bankruptcy petition was filed in 2012 and discharged in
February 2015. HSGD ¶ 7. The Hacketts claim that they
fully satisfied all of the arrears related to those
bankruptcies by May 2014. Id. Wells Fargo, however,
contends that only $929.39 of the $6, 000.00 loan arrearage
was paid by the Hacketts through the bankruptcy. Id.
According to Wells Fargo, the bankruptcy trustee's final
report indicates that the bank was stilled owed more than $5,
000 on the loan at the time the bankruptcy discharged in
February 2015. Id.
The 2013 Loan Modification Request
Fargo records indicate that the Hacketts filed paperwork
applying for a loan modification on January 18, 2013. BSGD
¶ 6. These same records indicate that a bank
representative opened a file on the application on February
12, 2013. BSGD ¶ 9. The bank next communicated with the
Hacketts on April 22, 2013, at which time the bank stated
that their "file is under review." Id. In
May 2013, the Hacketts' counsel at the time requested a
status update on the application. Id. The bank
representative stated she would investigate the status, and
sent several messages to the Hacketts between May, June, and
July 2013 to the effect that their application remained under
review. Id. On July 25, 2013, the bank
representative informed the Hacketts' that their
application "documents have expired" and instructed
the Hacketts to provide "all updated documents for the
file at this time." Id. The Hacketts
resubmitted application documents to the bank in September
2013. HSGD ¶ 8. The bank sent a response letter on
September 11, 2013 indicating that the bank was reviewing the
application. HSGD ¶ 9. After its review, the bank sent
the Hacketts a letter on October 3, 2013 including an offer
for a "Special Forbearance Plan." HSGD ¶ 10.
The plan confirmed that (i) the loan was in default, (ii) the
Hacketts would make three monthly loan payments in a reduced
amount of $1, 543.77, and (iii) the loan would still not be
current even if the three payments were made. HSGD ¶ 11.
The Hacketts made the three payments pursuant to the plan.
Id. Wells Fargo and the Hacketts subsequently
executed a one year Loan Modification Agreement in May 2014
("the 2014 Modification"). HSGD ¶ 12. The 2014
Modification lowered the Hacketts' interest rate to
2.875% and reduced the monthly payment amount to $1, 198.12
for the period between June 1, 2014 and July 1, 2015.
Id. The 2014 Modification also established a total
loan arrearage of $7, 716.31. Id. The Hacketts made
the required payments pursuant to the 2014 Modification
agreement during its term. HSGD ¶ 14.
The 2015 Loan
Request The Hacketts applied for a second loan modification
on July 15, 2015, two weeks after the terms of the 2014
Modification expired. HSGD ¶ 15. Wells Fargo sent a
response letter the following day. HSGD ¶ 17. That July
16 letter stated that it was a "response to [the
Hacketts'] recent request for mortgage assistance,"
and confirmed that the bank "recently received
documentation from you requesting mortgage assistance."
Id. The letter instructed the Hacketts to call the
bank to "determine what options might be available"
to assist them, and directed the Hacketts to
"gather" certain identified information "and
have it handy when you call." Id. The Hacketts
then spoke with the bank by phone on July 22, 2015. HSGD
¶ 18. On the phone. Wells Fargo advised the Hacketts
that the bank required additional documentation: (i) two
paycheck stubs from Lorinda Hackett; (ii) a Social Security
award letter from Walter Hackett; and (iii) documents showing
proof of change of circumstances. Id. Apart from the
July 16 letter, there is no evidence in the record
demonstrating that any of these requests were provided to the
Hacketts in writing.
next day, July 23, 2015, Wells Fargo informed the Hacketts in
writing that the bank had closed the file on their request
for modification because the Hacketts had failed to submit a
complete application. HSGD ¶ 19.
The 2016 Requests For Information
February 1, 2016, the Hacketts wrote to bank representatives
requesting information related to their loan. HSGD ¶ 20.
The letter requested information that, the Hacketts
contended, were related to their efforts to obtain another
loan modification. Id. Wells Fargo sent the Hacketts
a response dated that same day. HSGD ¶ 21. The Hacketts
deny receiving the letter, and contest that Wells Fargo in
fact sent the letter, even though the bank attaches the
letter to its motion. Id. The bank's letter
states that it would "complete our research" for
the requested information "and provide you with the
results on or before 02/15/2016." Id. On
February 15, 2016, the bank sent another letter indicating
that a substantive response could be expected before February
29, 2016. HSGD ¶ 22.
Fargo wrote to the Hacketts again on February 24, 2016. HSGD
¶ 23. The February 24 letter attached more than 50 pages
of documents and information requested by the Hacketts,
including the relevant deed of trust, promissory notes, loan
information report, as well as recent correspondence between
the bank and the Hacketts. Id. The bank stated that
it was "unable to provide any further information
because" the Hacketts' "remaining requests are
too broad." Id. The bank invited the Hacketts
to submit "more specific details about what you're
seeking," after which time they committed to review the
request again. Id. The Hacketts submitted a second
request for information on March 1, 2016. HSGD ¶ 26.
Wells Fargo acknowledged receipt on March 7, 2016. HSGD
¶ 27. On March 21, 2016, the bank sent the Hacketts
documents that responded to the requested information, but
again indicated that it could not comply with all of the
Hacketts requests since some of those requests were too
broad. HSGD ¶ 28.
The Hacketts' Current Status
Hacketts have been current on their loan payments since 2016.
HSGD ¶ 16. There have been no foreclosure proceedings.
HSGD ¶ 34. The Hacketts' credit ratings have neither
increased nor decreased since 2015. HSGD ¶ 35. The
Hacketts have approximately $300, 000 in equity in their
home, and do not plan to sell. HSGD ¶ 38. The Hacketts
claim that, as a result of the bank's alleged misconduct,
they have had to rely on short-term loans and retirement
savings to make their mortgage payments. HSGD ¶ 39.