Peter Maloney v. IndyMac Mortgage Services et al, No. 2:2013cv04781 - Document 61 (C.D. Cal. 2014)
Court Description: ORDER GRANTING DEFENDANTS MOTION TO DISMISS IN PART AND DENYING IN PART 27 .Plaintiffs claims are not preempted. Plaintiffs claims for unjust enrichment, breach of fiduciary duty, and conversion are DISMISSED, prejudice. In all other respects, Defendants motion is DENIED by Judge Dean D. Pregerson. (lc). Modified on 11/17/2014. (lc).
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Peter Maloney v. IndyMac Mortgage Services et al Doc. 61 1 2 O 3 4 5 NO JS-6 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 12 PETER MALONEY, individually and on behalf of all others similarly situated, 13 Plaintiff, 14 15 v. INDYMAC MORTGAGE SERVICES, ONEWEST BANK FSB, 16 Defendants. 17 ___________________________ ) ) ) ) ) ) ) ) ) ) ) ) ) ) Case No. CV 13-04781 DDP (AGRx) ORDER GRANTING DEFENDANT’S MOTION TO DISMISS IN PART AND DENYING IN PART [Dkt. No. 27] 18 19 Presently before the court is Defendant OneWest Bank, FSB 20 (“the Bank”)’s Motion to Dismiss. 21 submissions of the parties and heard oral argument, the court 22 grants the motion in part, denies the motion in part, and adopts 23 the following order. 24 I. 25 Having considered the Background Plaintiff Peter Maloney purchased a condominium, secured by 26 $158,500.00 mortgage, in 2006. 27 required Plaintiff to acquire insurance against any hazard “for 28 which Lender requires insurance . . . for the periods that Lender (Complaint ¶ 20.) The deed Dockets.Justia.com 1 requires.” 2 Plaintiff failed to maintain the required insurance coverage, 3 “Lender may obtain insurance coverage, at Lender’s option and 4 [Plaintiff’s] expense.” 5 the insurance be maintained “in the amounts . . . and for the 6 periods that Lender requires.” 7 the deed allowed the Lender to “do and pay for whatever is 8 reasonable or appropriate to protect Lender’s interest in the 9 Property” if Plaintiff failed to perform under the deed. (Compl., 10 Ex. 1 ¶ 9.) (Compl. ¶ 11 10.) 12 of the Bank serviced the loan during all relevant time periods. 13 (Compl. ¶¶ 10, 29.) 14 (Compl. ¶ 22.) The deed further provided that if (Id. ¶ 23.) The deed also required that (Compl., Ex. 1 ¶ 5.) More broadly, The Bank is a national banking association. While nonparty Fannie Mae owns Plaintiff’s loan, a subsidiary At some unspecified date, the Bank sent Plaintiff a letter 15 stating that, due to a change in Federal Emergency Management 16 Agency (“FEMA”) flood maps, Plaintiff’s property was located in a 17 Special Flood Hazard Area. 18 letter explained, Plaintiff’s condo needed to be covered by flood 19 insurance.1 20 letter on September 17, 2011. 21 informed Plaintiff that if he did not obtain flood insurance, the 22 Bank would have to obtain it on his behalf. 23 explained that if the Bank obtained coverage, “the cost may be 24 significantly higher than the premium that could be obtained if you 25 were to contact your local agent.” 26 disclosed that “We and/or our affiliates may receive compensation (Id.) (Compl., Ex. 5.) As a result, the The Bank sent Plaintiff a second, similar (Compl., Ex. 8.) (Id.) The second letter The second letter The letter further 27 1 28 It appears that at least one page of this undated letter is missing from the exhibit to the complaint. 2 1 in connection with the insurance policy described in this letter.” 2 (Id.) 3 Plaintiff did not obtain flood insurance. The Bank then 4 force-placed a $250,000 flood policy on Plaintiff’s property, with 5 an annual premium of $2,250.00. 6 alleges that the Bank received kickbacks from the insurance company 7 in the form of “‘commissions,’ ‘expense’ reimbursements, and/or 8 other compensation.” 9 that the Bank’s acts and excessive insurance requirements resulted (Compl. ¶¶ 36-37.) (Compl. ¶ 45.) Plaintiff Plaintiff’s Complaint alleges 10 “in unnecessary and unfair charges for force-placed flood 11 insurance.” 12 of action for breach of contract, unjust enrichment, breach of 13 fiduciary duty, conversion, and unfair business practices. 14 Bank now moves to dismiss. 15 II. 16 (Compl. ¶ 44.) The Complaint alleges state law causes The Legal Standard A complaint will survive a motion to dismiss when it contains 17 “sufficient factual matter, accepted as true, to state a claim to 18 relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 19 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 20 570 (2007)). 21 “accept as true all allegations of material fact and must construe 22 those facts in the light most favorable to the plaintiff.” Resnick 23 v. Hayes, 213 F.3d 443, 447 (9th Cir. 2000). 24 need not include “detailed factual allegations,” it must offer 25 “more than an unadorned, the-defendant-unlawfully-harmed-me 26 accusation.” 27 allegations that are no more than a statement of a legal conclusion 28 “are not entitled to the assumption of truth.” Id. at 679. When considering a Rule 12(b)(6) motion, a court must Iqbal, 556 U.S. at 678. 3 Although a complaint Conclusory allegations or In 1 other words, a pleading that merely offers “labels and 2 conclusions,” a “formulaic recitation of the elements,” or “naked 3 assertions” will not be sufficient to state a claim upon which 4 relief can be granted. 5 quotation marks omitted). 6 Id. at 678 (citations and internal “When there are well-pleaded factual allegations, a court should 7 assume their veracity and then determine whether they plausibly 8 give rise to an entitlement of relief.” Id. at 679. 9 must allege “plausible grounds to infer” that their claims rise Plaintiffs 10 “above the speculative level.” 11 “Determining whether a complaint states a plausible claim for 12 relief” is a “context-specific task that requires the reviewing 13 court to draw on its judicial experience and common sense.” 14 556 U.S. at 679. 15 III. Discussion Twombly, 550 U.S. at 555. 16 A. 17 Iqbal, The Bank contends that Plaintiff’s state law claims are Preemption 18 preempted for a variety of reasons, each of which the court 19 addresses in turn. 20 21 1. The National Flood Insurance Act “Congress enacted the National Flood Insurance Act of 1968 in 22 response to a growing concern that the private insurance industry 23 was unable to offer reasonably priced flood insurance on a national 24 basis.” 25 (9th Cir. 2000). 26 institutions are forbidden from making loans on structures within 27 special flood hazard areas unless the building is covered by flood 28 insurance. Flick v. Liberty Mutual Fire Ins. Co., 205 F.3d 386, 387 As of 1973, federally regulated lending 42 U.S.C. § 4012a(b)(1)(A). 4 Covered structures must be 1 insured “in an amount at least equal to the outstanding principal 2 balance of the loan or the maximum limit of coverage made available 3 under the [NFIA] . . ., whichever is less.2 4 servicer becomes aware that a building securing a loan is 5 inadequately covered, the lender or servicer must inform the 6 borrower that the borrower should obtain flood coverage. 7 4012a(e)(1). 8 required coverage, the lender or servicer must obtain flood 9 insurance on the borrower’s behalf. Id. If a lender or 42 U.S.C. If the borrower ultimately fails to obtain the 42 U.S.C. § 4012a(e)(2). A 10 regulated institution that force-purchases required coverage 11 satisfies any regulations promulgated under 42 U.S.C. § 4012a(b), 12 “[n]otwithstanding any State or local law.” 42 U.S.C. § 13 4012a(f)(6). 14 The Bank argues that the “notwithstanding any State or local 15 law” language of 42 U.S.C. § 4012a(f)(6) indicates that the NFIA 16 occupies the field of flood insurance placement. 17 Reply at 7.) 18 thoroughly occupies a legislative field that there is no room for 19 state action in that area.” 20 (9th Cir. 2008) (citing Montalvo v. Spirit Airlines, 508 F.3d 464, 21 470 (9th Cir. 2007)). 22 (Mot. at 12; Field preemption exists when a federal law “so Donell v. Kowell, 533 F.3d 762, 775 The Bank cites several out-of-circuit cases to support its 23 field preemption argument. Aside from being non-binding, these 24 cases are distinguishable. In Wright v. Allstate Insurance Co., 25 for example, the Fifth Circuit adopted the reasoning of the Third 26 and Sixth Circuits in finding a flood insurance claim preempted 27 2 28 The maximum amount varies, depending on the type of structure at issue. See 42 U.S.C. § 4013(b). 5 1 under the NFIA. 2 390 (5th Cir. 2005). 3 nothing to do with forced-placement of coverage, but rather a 4 disputed valuation of covered damage. 5 that specific factual context, the court limited its preemption 6 holding to “state law tort claims arising from claims handling . . 7 .,” with no mention of force-placed coverage. 8 added). 9 Wright v. Allstate Insurance Co., 415 F.3d 384, The claim at issue in Wright, however, had Id. at 386. In light of Id. at 390 (emphasis Contrary to the Bank’s suggestion, therefore, the Wright court 10 did not opine that the NFIA occupies the field of flood insurance 11 placement. 12 federal law might impliedly preempt state law, the other being 13 conflict preemption. 14 Inc. V. Aetna Casualty and Surety Co., upon which Wright relies, 15 the Third Circuit explicitly declined to apply field preemption in 16 a flood insurance claim dispute case. 17 Casualty and Surety Co., 386 F.3d 263, 269 (9th Cir. 2004). 18 did the Sixth Circuit in Gibson v. American Bankers Insurance Co. 19 specify whether field preemption principles applied. 20 952 n.2 (Sixth Cir. 2002) (Moore, J., dissenting). 21 however, the Gibson court limited its holding to claims processing 22 disputes, declining to decide “whether policy procurement type 23 state law claims are preempted by NFIA.” Field preemption is but one of two ways in which Montalvo, 508 F.3d at 470. In C.E.R. 1988, C.E.R. 1988, Inc. V. Aetna Nor 289 F.3d 943, As in Wright, Id. at 949-50. 24 These authorities, therefore, cannot support the Bank’s 25 contention that NFIA occupies the field of forced flood insurance 26 placement. 27 recognized, agencies implementing the NFIA appear to agree that 28 NFIA does not preempt all flood-insurance related claims under Furthermore, as one court in this circuit has 6 1 state law. 2 WHA, 2010 WL 3259773 at *11 (N.D. Cal. Aug. 16, 2010) (citing 74 3 Fed. Reg. 35914, 35918 (July 21, 2009) (“[T]here may be penalties 4 for over-insurance under applicable State law.”)). 5 not address whether the NFIA preempts claims-processing disputes 6 because Plaintiff here raises no such claims. 7 placement claims, however, are not field preempted. 8 9 Hofstetter v. Chase Home Finance, LLC., No. C 10-1313 2. This court does Plaintiff’s forced- Filed Rate Doctrine The Bank also argues that Plaintiff’s claims are barred by the 10 filed rate doctrine. 11 doctrine holds that any rate approved by a government regulatory 12 agency is reasonable, and therefore cannot be judicially challenged 13 by a ratepayer. 14 Cir. 1994). 15 flood insurance rates, must be approved by the California 16 Department of Insurance. 17 governing business generally also apply to the insurance industry. 18 Cal. Ins. Code §§ 1860.2, 1861.3(a). 19 Insurance Code also states that “[n]o act done, action taken or 20 agreement made pursuant to the authority conferred by this chapter 21 shall constitute a violation of or grounds for prosecution or civil 22 proceeding under any other law of this State . . . which does not 23 specifically refer to insurance.” 24 attempt to harmonize these conflicting principles, California 25 courts have held that actions taken pursuant to ratemaking 26 authority, including the charging of an approved rate, are exempt 27 from other, non-insurance-related laws. 28 188 Cal. App. 4th 1427, 1443 (2010). (Mot. at 14.) The court-created filed rate Wegoland Ltd. V. NYNEX Corp., 27 F.3d 17, 19 (2nd In California, property insurance rates, including Cal. Ins. Code § 1861.01(c). Laws However, the California Cal. Ins. Code § 1860.1. 7 In an MacKay v. Superior Court, California’s statutory scheme 1 is thus analogous to, albeit distinct from, the filed rate 2 doctrine. 3 757 n.4 (2000).3 Walker v. Allstate Indemnity Co., 77 Cal. App. 4th 750, 4 The Bank argues that Plaintiff’s claims, though pled as 5 contract and tort claims, are actually challenges to the premiums 6 Plaintiff was required to pay on the force-placed flood insurance 7 policies. 8 or commissions underpinning Plaintiff’s complaint are merely 9 components of a government-approved rate. In other words, the Bank contends that the “kickbacks” As such, the argument 10 goes, the filed rate doctrine and California Insurance Code bar 11 Plaintiff’s state law claims. 12 Defendant cites Singleton v. Wells Fargo Bank, N.A., No. 13 12CV216-NBB-SAA, 2013 WL 5423917 (N.D. Miss. Sept. 26, 2013), to 14 support its argument in favor of broad application of the filed 15 rate doctrine. 16 to bar kickback claims against a bank. 17 Unlike Plaintiff here, however, the Singleton plaintiff 18 specifically alleged that she was charged “exorbitant” and 19 “illegal” rates. 20 legality of an approved rate, other out-of-circuit courts have 21 refused to apply the filed rate doctrine. 22 JPMorgan Chase Bank, N.A., 678 F.Supp.2d 1273 23 (S.D. Fla. 2009); Kunzelman v. Wells Fargo Bank, N.A., No. 24 81373-DMM, 2012 WL 2003337 (S.D. Fla. June 4, 2012). Indeed, the Singleton court did apply the doctrine Id. Singleton, 2013 WL at *2. Absent such explicit challenges to the See, e.g. Ables v. 11-cv- 25 26 27 28 3 California courts are split as to whether the judicially created filed rate doctrine applies. See Leghorn v. Wells Fargo Bank, N.A., 550 F.Supp.2d. 1093, 1115 (N.D. Cal. 2013). 8 1 Courts in this circuit have adopted the same approach. 2 Leghorn v. Wells Fargo Bank, N.A., 550 F.Supp.2d. 1093, 1115-16 3 (N.D. Cal. 2013), the court explained, with reference to 4 allegations similar to those here, that kickback claims did not 5 present a challenge to an insurance rate itself, but rather the 6 lender/servicer’s decision to favor one particular insurance 7 carrier. 8 on increased costs incurred as a result of the alleged kickback 9 scheme does not transform a challenge to conduct and practices into This court agrees. In “Just because the damages are based 10 a challenge to the premiums.” 11 F.Supp.2d 1063, 1083 (N.D. Cal. 2012). 12 aside the question whether the filed rate doctrine applies to a 13 claim brought against a party other than an insurer, the Bank’s 14 choice of carriers is not dependent upon or made pursuant to any 15 ratemaking authority under the California Insurance Code. 16 neither the Insurance Code nor the filed rate doctrine bar 17 Plaintiff’s claims. 18 19 3. Ellsworth v. U.S. Bank, N.A., 908 Furthermore, even putting Thus, Home Owners’ Loan Act and National Bank Act The Home Owners’ Loan Act (“HOLA”), 12 U.S.C. § 1461 et seq., 20 granted the Office of Thrift Supervision (“OTS”) broad authority to 21 regulate federal savings associations. 22 Corp., 514 F.3d 1001, 1005 (9th Cir. 2008). 23 12 CFR § 560.2(a), entitled “Occupation of field,” stated that 24 “[p]ursuant to . . . HOLA, OTS is authorized to promulgate 25 regulations that preempt state laws affecting the operations of 26 federal savings associations . . . . 27 entire field of lending regulation for federal savings 28 associations.” Silvas v. E*Trade Mortgage One OTS regulation, OTS hereby occupies the Preempted state laws include those that impose 9 1 requirements regarding the “[p]rocessing, origination, servicing, 2 sale or purchase of, or investment or participation in, 3 mortgages[.]” 4 provided, however, that state laws, including contract and tort 5 laws, that “only incidentally affect the lending operations of 6 Federal savings associations” are not preempted. 7 560.2(c). 8 9 12 CFR § 560.2(b)(10). The regulations further 12 CFR § On July 21, 2011, however, the Dodd-Frank Act transferred supervisory authority from OTS to the Office of the Comptroller of 10 the Currency (“OCC”). 11 issue here occurred after this transfer. 12 further provided that HOLA does not occupy the field of lending 13 regulations for thrifts, and that preemption under HOLA is governed 14 by the same standards applicable to national banks. 15 World Savings Bank F.S.B., No. ED CV 11-800 MMM; 2012 WL 1026103 at 16 *13 (C.D. Cal. Jan. 11, 2012). 17 National Bank Act (“NBA”) and its implementing regulations, are 18 more lenient and less all-encompassing than the former HOLA 19 standards. 20 1009, 1019-20 (N.D. Cal. 2012); 12 U.S.C. § 21; 12 C.F.R. § 34.4. 21 Under NBA regulations, “a national bank may make real estate 12 U.S.C. § 5412. All of the events at The Dodd-Frank Act See Settle v. Those standards, set forth by the See Tanburri v. Suntrust Mortgage, Inc., 875 F.Supp.2d 22 loans . . . without regard to state law limitations concerning . . 23 . the ability of a creditor to require or obtain . . . insurance 24 for other collateral.” 25 the “[p]rocessing, origination, servicing, sale or purchase of, or 26 investment or participation in, mortgages” are also preempted. 27 Id.; Martinez v. Wells Fargo Home Mortgage, Inc., 598 F.3d 549, 555 28 (9th Cir. 2010) (“[S]tate laws that obstruct, impair, or condition 12 CFR § 34.4(a). 10 State laws regarding 1 a national bank’s ability to fully exercise its Federally 2 authorized real estate lending powers are preempted.” (internal 3 quotation omitted). 4 States may, however, “regulate the activities of national 5 banks where doing so does not prevent or significantly interfere 6 with the national bank’s or the national bank regulator’s exercise 7 of its powers.” 8 (2007). 9 contracts, torts, and any other laws with only incidental effect on Watters v. Wachovia Bank, N.A., 550 U.S. 1, 12 Consistent with this principle, state laws regarding 10 lending operations are not preempted. 11 598 F.3d at 555 (“State laws of general application, which merely 12 require all businesses (including national banks) to refrain from 13 fraudulent, unfair, or illegal behavior, do not necessarily impair 14 a bank’s ability to exercise its real estate lending powers.”). 15 12 CFR § 34.3(b); Martinez, The Bank argues that Plaintiff’s state law claims implicate 16 the Bank’s discretionary power to impose non-interest fees and 17 charges in accordance with sound banking principles and judgment. 18 12 CFR § 7.4002. 19 that the Bank charges any particular fee at all. 20 above in the filed rate context, Plaintiff’s claims do not 21 challenge any fee imposed by the Bank, but rather question the 22 method by which the Bank selects an insurance carrier. 23 Ellsworth, 908 F. Supp. 2d at 1078; Leghorn, 2013 WL at *16; Cannon 24 v. Wells Fargo Bank N.A., 917 F.Supp.2d 1025, 1049-50 (N.D. Cal. 25 2013.) 26 state laws at issue here prevent it from obtaining flood insurance 27 or interfere in any meaningful way with its ability to do so. 28 Accordingly, the NBA does not preempt Plaintiff’s claims. Plaintiff’s complaint, however, does not allege As discussed See The Bank has not demonstrated that the broadly applicable 11 1 2 B. 3 4 Sufficiency of State Law Claims 1. Breach of Contract A breach of contract claim requires, as a matter of course, an 5 allegation of a breach. 6 Chase Bank, NA, 863 F.Supp.2d 928, 954 (N.D. Cal. 2012). 7 argues that Plaintiff has failed to allege a breach because (1) the 8 deed of trust allows the Bank to require flood insurance, (2) the 9 deed allows the Bank to determine the proper amount of coverage, See, e.g. McNeary-Calloway v. JPMorgan The Bank 10 and (3) the deed does not prohibit the payment or receipt of 11 commissions. 12 Defendant is correct that Section 5 of the deed of trust 13 allows it to require flood insurance and to determine the period 14 and amount of such coverage. 15 unbridled. 16 this case, the Bank as servicer), “may do . . . whatever is 17 reasonable or appropriate to protect Lender’s interest in the 18 Property and rights under this Security Instrument . . . .” 19 terms are identical to those at issue in other, similar cases, 20 including Ellsworth. 21 That power, however, is not Section 9 of the deed states that the Lender (or, in These Ellsworth, 908 F.Supp.2d at 1084-85. The fundamental goal of contract interpretation is to give 22 effect to the mutual intention of the parties.” 23 v. Superior Court, 2 Cal.4th 1254, 552 (1992). 24 contract must be read in context, taking into account the 25 circumstances of the case and the language of the contract in its 26 entirety. 27 explicit contractual language controls, and contractual claims may 28 be resolved on a motion to dismiss when such terms are at issue. Bank of the West The provisions of a Universal City, 208 Cal.App.4th at 737. 12 Clear and 1 Bank of the West, 2 Cal.4th at 552; Monaco v. Bear Stearns 2 Residential Mortgage Corp., 554 F.Supp.2d 1034, 1040 (C.D. Cal. 3 2008). 4 capable of two or more reasonable interpretations and therefore 5 leaves doubt as to the parties’ intent, a motion to dismiss must be 6 denied. 7 But where the language is ambiguous, such that is is Monaco, 554 F.Supp.2d at 1041. Here, as in Ellsworth, the tension between the discretion 8 granted to the Bank by section 5 of the agreement and the 9 limitations imposed by the “reasonable or appropriate” language of 10 section 9 create ambiguities regarding the authorized level of 11 insurance and the propriety of commissions that cannot be resolved 12 at this stage. 13 Bank’s motion to dismiss Plaintiff’s breach of contract claim is, 14 therefore, denied.4 15 16 2. See Ellsworth, 908 F.Supp.2d at 1084-85. The Unjust Enrichment Plaintiff’s Complaint asserts causes of action for both breach 17 of contract and unjust enrichment. 18 recover on an unjust enrichment or quasi contract claim if the 19 parties have an enforceable agreement covering the same subject 20 matter. 21 965 F.Supp.2d 1141, 1154 (E.D. Cal. 2013). 22 Civil Procedure 8(d)(3) allows inconsistent claims to be pled, Rule 23 8 does not allow a plaintiff to circumvent state law by stating a A plaintiff may not, however, Sacramento E.D.M. Inc. V. Hynes Aviation, Indus., Inc., Though Federal Rule of 24 25 26 27 28 4 Defendant argues briefly, in a footnote, that Plaintiff’s claim for breach of the implied covenant of good faith and fair dealing fails for the same reasons advanced with respect to the breach of contract claim. Having concluded that Plaintiff’s breach of contract claim survives, the court notes that Plaintiff’s good faith and fair dealing claim survives for similar reasons. See also Leghorn, 950 F.Supp.2d at 1119-20. 13 1 claim for both express and quasi contract. 2 Privacy Litigation, 791 F.Supp.2d 705, 718 (N.D. Cal. 2011) 3 (“Although Rule 8 . . . allows a party to state multiple, even 4 inconsistent claims, the rule does not allow a party invoking state 5 law to assert an unjust enrichment claim while also alleging an 6 express contract.”); Custom LED, LLC v. eBay, Inc., No. C 12-350 7 SI, 2012 WL 1909333 at *5 (N.D. Cal. 2012).5 8 enrichment claim is dismissed with prejudice. 9 10 3. See In re Facebook Plaintiff’s unjust Breach of Fiduciary Duty Plaintiff’s Complaint alleges that a fiduciary relationship 11 arose between he and the Bank because the Bank held money in escrow 12 for flood insurance premiums. 13 financial institutions operating as conventional lenders of money 14 do not owe fiduciary duties to borrowers. 15 Loans Servicing, LP, No. SACV 11-915-JST, 2012 WL 7051318 at *7 16 (C.D. Cal. Dec. 20, 2012). 17 loan servicer’s conventional role. 18 escrow services does not fall outside that conventional role, and 19 does not create a fiduciary relationship. 20 J.P. Morgan Chase, N.A., No. CIV. 2:12-225 WBS, 2012 WL 1574821 at 21 *3 (E.D. Cal. May 3, 2012). 22 claim is dismissed with prejudice. 23 4. (Compl. ¶¶ 97-98.) Generally, Gustafson v. BAC Home Force-placing insurance falls within a Id. The provision of some Id.; See also Rose v. Plaintiff’s breach of fiduciary duty Conversion 24 A claim for conversion requires “(1) ownership of or right to 25 possess the property, (2) the defendant’s conversion by a wrongful 26 27 28 5 Courts are split as to whether unjust enrichment is an independent cause of action in California. See Cheung v. Wells Fargo Bank, N.A., 987 F.Supp.2d 972, 979 (N.D. Cal. 2013). 14 1 act or disposition of the property, and (3) damages.” Hopkins v. 2 Wells Fargo Bank, N.A., No. CIV. 2:13-00444 WBS, 2013 WL 2253837 at 3 *9 (E.D. Cal. May 22, 2013). 4 that the Bank did have the right to use escrow funds to pay for 5 flood insurance. 6 of escrow funds was wrongful because the Bank was not authorized to 7 spend escrow funds pursuant to a kickback scheme and was not 8 authorized to purchase the level of insurance that it did. 9 at 16.) Plaintiff does not appear to dispute, Plaintiff contends, however, that the disposition (Opp. Those allegations are the core of Plaintiff’s breach of 10 contract claims, and are better resolved in that context. 11 Hopkins, 12 premised upon same conduct as breach of contract claim); McKenzie 13 v. Wells Fargo Bank, N.A, 931 F.Supp.2d 1028, 15-16 (N.D. Cal. 14 2013) (dismissing conversion claim regarding force-placed flood 15 insurance premiums). 16 IV. 17 See 2013 WL 2253837 at *10 (dismissing conversion claim Conclusion For the reasons stated above, Defendant’s Motion to Dismiss is 18 GRANTED in part and DENIED in part. 19 preempted. 20 fiduciary duty, and conversion are DISMISSED, prejudice. 21 other respects, Defendant’s motion is DENIED.6 22 IT IS SO ORDERED. 23 Dated:November 17, 2014 Plaintiffs’ claims are not Plaintiff’s claims for unjust enrichment, breach of In all DEAN D. PREGERSON United States District Judge 24 25 26 6 27 28 Because Plaintiff’s breach of contract and good faith and fair dealing claims survive, so too does his unfair competition claim under California Business & Professions Code § 17200. See Leghorn, 950 F.Supp.2d at 1120-21. 15
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