Rumbaua v. Wells Fargo Bank N.A. et al, No. 3:2011cv01998 - Document 30 (N.D. Cal. 2011)
Court Description: ORDER granting 15 Motion to Dismiss; denying 16 Motion to Strike (sclc1, COURT STAFF) (Filed on 8/25/2011)
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Rumbaua v. Wells Fargo Bank N.A. et al Doc. 30 1 2 3 4 IN THE UNITED STATES DISTRICT COURT 5 FOR THE NORTHERN DISTRICT OF CALIFORNIA 6 7 LORDA RUMBAUA, 8 Plaintiff, 9 v. United States District Court For the Northern District of California 10 WELLS FARGO BANK, N.A.; EXECUTIVE TRUSTEE SERVICES, LLC dba ETS SERVICES, LLC; and DOES 1-10, inclusive; 11 12 13 Defendants. 14 ) ) ) ) ) ) ) ) ) ) ) ) ) Case No. 11-1998 SC ORDER RE: DEFENDANT'S MOTIONS TO DISMISS AND TO STRIKE 15 16 I. INTRODUCTION 17 Before the Court is a fully briefed motion by Defendant Wells 18 Fargo Bank, N.A. ("Defendant" or "Wells Fargo") seeking dismissal 19 of the Complaint filed by Plaintiff Lorda Rumbaua ("Plaintiff"). 20 ECF Nos. 15 ("MTD"), 18 ("MTD Opp'n"), 20 ("MTD Reply").1 21 Fargo also moves to strike portions of Plaintiff's Complaint. 22 Nos. 16 ("MTS"), 19 ("MTD Opp'n"), 21 ("MTS Reply"). 23 following reasons, the Court GRANTS Wells Fargo's MTD and DENIES 24 Wells Fargo's MTS as moot. Wells ECF For the 25 26 27 28 1 Defendant ETS Services, LLC ("ETS") has not participated in this action. While Wells Fargo alleged in its Notice of Removal that ETS would file a declaration of non-monetary status pursuant to Cal. Civ. Code § 2924l, it has yet to do so. Dockets.Justia.com 1 II. BACKGROUND As it must on a Rule 12(b)(6) motion, the Court assumes the 2 3 truth of the well-pleaded facts in Plaintiff's Complaint.2 4 Plaintiff is a California resident. 5 purchased a home located at 709 Larch Avenue, South San Francisco, 6 California ("the property"). 7 Joson ("Joson"), a representative of Wachovia Mortgage, FSB 8 ("Wachovia"), advised Plaintiff to refinance her loan with 9 Wachovia. Id. ¶ 63.3 Compl. ¶ 1. Id. ¶¶ 1, 6. In 2000, she In 2006, Frederick Joson allegedly told Plaintiff that the new United States District Court For the Northern District of California 10 loan would have a lower interest rate and a lower monthly payment 11 than Plaintiff's current loan, "and that Plaintiff would be able 12 to obtain cash out of the proceeds from the new loan." 13 In 2006, Plaintiff obtained a loan from World Savings; the loan 14 was secured by a Deed of Trust executed and delivered to World 15 Savings. 16 three years prior to the filing of this action," she realized that 17 Joson's statements were false, and that under the new loan, both 18 her interest rates and monthly payments were higher. Id. ¶¶ 6, 7. Id. ¶ 66. Plaintiff alleges that "within the past Id. ¶ 71. 19 20 21 22 23 24 2 However, the Court does not accept as true allegations that contradict exhibits attached to the Complaint or matters properly subject to judicial notice. Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). 3 25 26 27 28 Plaintiff alleges -- and Defendant concedes -- that Wachovia was formerly known as World Savings Bank, FSB ("World Savings"), and is now a division of Wells Fargo. See Compl. ¶ 1, MTD at 1. Plaintiff's Complaint appears to use these names interchangeably and somewhat confusingly. For example, in 2006, Wachovia was still known as World Savings, but Plaintiff claims she entered into loan refinance discussions with a "Wachovia" representative in 2006, resulting in a loan from "World Savings." Compl. ¶¶ 6-7, 63-66. 2 1 Plaintiff alleges that on or about February 16, 2010, 2 Plaintiff telephoned Wells Fargo and requested a modification of 3 her loan "as she was finding it difficult to make monthly mortgage 4 payments." 5 Plaintiff that Wells Fargo could not help Plaintiff, but that she 6 should default on her loan and that once Plaintiff was in default, 7 Wells Fargo would modify her loan. 8 statements, Plaintiff defaulted on her loan. Id. ¶ 16. Wells Fargo's representative allegedly told Id. In reliance on these Id. ¶ 17. United States District Court Also in February 2010, a Wells Fargo representative allegedly 10 For the Northern District of California 9 told Plaintiff that she needed to show more income to qualify for 11 modification, "and that Plaintiff should rent out part of her 12 house." 13 written rental agreement, renting out a portion of her home for 14 $1200 per month. 15 all the documents requested by Wells Fargo with respect to 16 modification, but that "Wells Fargo claimed, time and time again, 17 that they were missing some documents or that they had not 18 received the documents." Id. ¶ 21. Plaintiff alleges that she entered into a Id. ¶ 22. Plaintiff alleges that she submitted Id. ¶¶ 18, 19. 19 Plaintiff alleges that in mid-September 2010, a Wells Fargo 20 representative named Joy told Plaintiff that her home was being 21 foreclosed upon and that there was nothing that Plaintiff or Wells 22 Fargo could do to stop the foreclosure sale. 23 September 23, 2010, the property was sold by the trustee, 24 Defendant Executive Trustee Services ("ETS"), via non-judicial 25 foreclosure. 26 action in California Superior Court for San Mateo County to evict 27 Plaintiff from the property. Id. ¶ 11. Id. ¶¶ 24-26. On Wells Fargo filed an unlawful detainer Id. ¶ 56. 28 3 Judgment was entered in 1 favor of Wells Fargo, and Plaintiff's appeal of this judgment is 2 currently pending. Id. On March 7, 2011, Plaintiff commenced this action in 3 4 California Superior Court for San Mateo County; Defendant removed 5 to federal court on April 22, 2011. 6 her Complaint, Plaintiff brings nine causes of action. 7 seeks to set aside the foreclosure sale under California Civil 8 Code § 2924. 9 negligent misrepresentation against Wells Fargo, alleging that she Compl. ¶¶ 1-14. See Notice of Removal. In First, she Second, she brings a claim for United States District Court For the Northern District of California 10 detrimentally relied on the statements of Wells Fargo's 11 representatives in February 2010 that she would qualify for a 12 modification if she defaulted and the statement of Wells Fargo's 13 representative in September 2010 that there was nothing she could 14 do to avoid the foreclosure sale. 15 brings an action for "detrimental reliance" against Wells Fargo, 16 alleging that Plaintiff justifiably relied on the statements made 17 by Wells Fargo's representatives to not pay the default amount. 18 Id. ¶¶ 39-41. 19 and ETS for cancellation of the trustee's deed, alleging that it 20 is void "for the reasons set forth in this Complaint." 21 47. 22 claiming that Wells Fargo has no legitimate interest in the 23 property. 24 accounting against Wells Fargo and ETS, requesting "an accounting 25 of all sums owed by Plaintiff to Wells Fargo up to and including 26 the date of the foreclosure sale on the subject property." 27 52-54. 28 seeking an injunction barring Defendants from pursuing the 4 Id. ¶¶ 15-38. Third, she Fourth, she brings an action against Wells Fargo Id. ¶¶ 42- Fifth, she brings a quiet title action against Wells Fargo, Id. ¶¶ 48-51. Sixth, she brings an action for Id. ¶¶ Seventh, she brings a claim for "injunctive relief," 1 unlawful detainer action. 2 claim of intentional misrepresentation against Wells Fargo, 3 alleging that in 2006, Joson falsely represented that by 4 refinancing with World/Wachovia, Plaintiff would lower her 5 interest rate and monthly payments. 6 Plaintiff brings a claim under section 17200 of California's 7 Business and Professions Code ("section 17200"), alleging that 8 Wells Fargo conducted unlawful, unfair, or fraudulent business 9 practices by violating the Truth in Lending Act ("TILA") and United States District Court For the Northern District of California 10 Id. ¶¶ 55-61. Eighth, she brings a Id. ¶¶ 62-77. through the allegedly false statements of Joson. Ninth, Id. ¶¶ 78-84. 11 12 13 III. LEGAL STANDARD A motion to dismiss under Federal Rule of Civil Procedure 14 12(b)(6) "tests the legal sufficiency of a claim." Navarro v. 15 Block, 250 F.3d 729, 732 (9th Cir. 2001). 16 on the lack of a cognizable legal theory or the absence of 17 sufficient facts alleged under a cognizable legal theory. 18 Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 19 1990). 20 should assume their veracity and then determine whether they 21 plausibly give rise to an entitlement to relief." 22 Iqbal, 129 S. Ct. 1937, 1950 (2009). 23 court must accept as true all of the allegations contained in a 24 complaint is inapplicable to legal conclusions. 25 recitals of the elements of a cause of action, supported by mere 26 conclusory statements, do not suffice." 27 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). 28 allegations made in a complaint must be both "sufficiently detailed 5 Dismissal can be based "When there are well-pleaded factual allegations, a court Ashcroft v. However, "the tenet that a Threadbare Iqbal, 129 S. Ct. at 1950 The 1 to give fair notice to the opposing party of the nature of the 2 claim so that the party may effectively defend against it" and 3 sufficiently plausible such that "it is not unfair to require the 4 opposing party to be subjected to the expense of discovery." 5 v. Baca, 633 F.3d 1191, 1204 (9th Cir. 2011). Starr 6 7 8 9 IV. DISCUSSION Plaintiff's claims fall into three categories. Her first, fourth, fifth, sixth, and seventh claims relate to the validity of United States District Court For the Northern District of California 10 the foreclosure sale and subsequent unlawful detainer action. 11 second and third claims stem from her loan modification 12 discussions with Defendant in 2010. 13 concern the origination of the loan in 2006. 14 Her these three categories of claims separately. Her eighth and ninth claims The Court addresses 15 A. 16 Defendant makes a number of arguments that Plaintiff's claims Plaintiff's Claims Challenging Foreclosure 17 seeking to set aside the foreclosure sale are legally deficient. 18 Among them, it argues that the validity of the foreclosure sale 19 was already determined in the unlawful detainer action, and thus 20 Plaintiff's Complaint represents an impermissible collateral 21 attack on the state court's judgment in that action. MTD at 6. 22 "Under the judicially-developed doctrine of collateral 23 estoppel, once a court has decided an issue of fact or law 24 necessary to its judgment, that decision is conclusive in a 25 subsequent suit based on a different cause of action involving a 26 party to the prior litigation." 27 159 (1984). 28 purchaser who acquired a property through a trustee sale must 6 U.S. v. Mendoza, 464 U.S. 154, To prevail in an unlawful detainer action, a 1 prove the property was sold in accordance with section 2924 of the 2 California Civil Code. 3 188 Cal. App. 4th 968, 976 (Ct. App. 2010). 4 California Superior Court necessarily found that Defendant's 5 foreclosure sale of Plaintiff's property was proper when it 6 entered judgment in favor of Defendant in the unlawful detainer 7 action. 8 this action, the validity of the foreclosure sale has already been 9 litigated by the parties, and Plaintiff cannot collaterally attack Malkoskie v. Option One Mortgage Corp., As such, the Because both Plaintiff and Wells Fargo were parties to United States District Court For the Northern District of California 10 it here. Similarly, Plaintiff's seventh claim to enjoin Defendant 11 from participating in the appeal of the unlawful detainer action 12 is impermissible under the Anti-Injunction Act, 28 U.S.C. § 2283. 13 For these reasons, Plaintiff's first, fourth, fifth, and 14 seventh claims are DISMISSED WITH PREJUDICE. To the extent 15 Plaintiff premises her section 17200 claim on the invalidity of 16 the foreclosure, this claim is also DISMISSED WITH PREJUDICE. 17 Because the foreclosure sale extinguished Plaintiff's debt, the 18 Court also DISMISSES WITH PREJUDICE Plaintiff's sixth action for 19 an accounting. 20 B. Plaintiff's Loan Modification Claims 21 Plaintiff's second and third claims concern her attempts at 22 loan modification in 2010. In her second claim, Plaintiff alleges 23 Defendant committed negligent misrepresentation when its 24 representatives allegedly told her in February 2010 that she would 25 qualify for a modification if she defaulted on her loan and in 26 September 2010 when they allegedly told her that there was nothing 27 she could do to stop the foreclosure sale. 28 because under California law, negligent misrepresentation is a 7 Defendant argues that 1 species of fraud, Plaintiff must satisfy the heightened federal 2 pleading standard of Rule 9(b) of the Federal Rules of Civil 3 Procedure. 4 are subject to a higher pleading standard. 5 "To satisfy Rule 9(b), a pleading must identify the who, what, 6 when, where, and how of the misconduct charged, as well as what is 7 false or misleading about [the purportedly fraudulent] statement, 8 and why it is false." 9 Sys., Inc., 637 F.3d 1047, 1055 (9th Cir. 2011) (internal United States District Court For the Northern District of California 10 11 MTD at 7. The Court agrees; claims sounding in fraud Fed. R. Civ. P. 9(b). Cafasso, U.S. ex rel. v. Gen. Dynamics C4 quotation marks omitted). Defendant argues that the alleged February 2010 communication 12 does not support a negligent misrepresentation claim. The Court 13 agrees. 14 misrepresentation of material fact; (ii) without a reasonable 15 ground for believing it to be true; (iii) with intent to induce 16 the plaintiff's reliance on the fact misrepresented; (iv) 17 ignorance of the truth and justifiable reliance on the 18 misrepresentation by the plaintiff; and (v) resulting damage. 19 Shamsian v. Atlantic Richfield Co., 107 Cal. App. 4th 967, 983 20 (Ct. App. 2003). 21 claim, Plaintiff must plausibly allege -- with the particularity 22 required by Rule 9(b) -- that Defendant's representatives told 23 Plaintiff that if she defaulted on her loan, she would qualify for 24 a modification. 25 made this statement without reasonable ground for believing it to 26 be true. 27 to her detriment. 28 mortgage payment since November 2009, which belies her allegation 8 The elements of negligent misrepresentation are: (i) a To properly plead a negligent misrepresentation She must allege that Defendant's representatives She must allege she justifiably relied on this statement Plaintiff concedes that she has not made a 1 that she stopped making payments in "reliance" on this alleged 2 statement. 3 representative told her that she needed to show additional income 4 to qualify for a modification conflicts with her suggestion that 5 Defendant's representatives told her that if she defaulted, she 6 would qualify for a modification, as it suggests default was 7 merely one of a number of requirements for loan modification. As for the September 2010 communication in which Defendant's 8 9 Furthermore, Plaintiff's allegation that Defendant's representatives allegedly told Plaintiff that there was nothing United States District Court For the Northern District of California 10 she could do to stop the foreclosure sale, Defendant also argues 11 that Plaintiff has failed to plead with the required particularly. 12 MTD at 9. 13 that the alleged statement was false, because under California 14 Civil Code § 2924c, Plaintiff's time to tender to cure the default 15 expired on September 18, 2010, five days before the sale date. 16 Id. 17 that Plaintiff could no longer cure the default, such a statement 18 would be true. 19 because under Nymark v. Heart Federal Savings & Loan Ass'n, 231 20 Cal. App. 3d 1089, 1096 (1991), a lender does not owe a tort duty 21 of care to a borrower where the lender does not exceed the scope 22 of its conventional role of a lender. 23 Defendant alleges that Plaintiff has not established As such, if Defendant told Plaintiff after September 17, 2010 Id. Defendant also argues that this claim fails The Court agrees with Defendant. MTD at 10. California's non-judicial 24 foreclosure law places a number of requirements on lenders seeking 25 to foreclose on a property. 26 Under Nymark, however, a lender operating within the scope of its 27 traditional role does not have a general duty -- beyond these 28 statutory obligations -- to advise borrowers on the law. 9 See Cal. Civ. Code § 2924 et seq. To the 1 extent that Plaintiff alleges that Defendant's representative 2 unintentionally misinformed Plaintiff of the alternatives to 3 foreclosure, Plaintiff's claim fails as a matter of law. Additionally, Defendant argues Plaintiff's third claim for 4 5 detrimental reliance is not an independent claim, but rather an 6 element of a number of different claims. 7 concedes this claim "should more appropriately be entitled 8 Promissory Estoppel rather than Detrimental Reliance." 9 at 3. MTD at 10. Plaintiff MTD Opp'n Defendant responds that Plaintiff has failed to United States District Court For the Northern District of California 10 sufficiently plead a promissory estoppel claim. The elements of a 11 claim for promissory estoppel are: "(1) a promise clear and 12 unambiguous in its terms; (2) reliance by the party to whom the 13 promise is made; (3)[the] reliance must be both reasonable and 14 foreseeable; and (4) the party asserting the estoppel must be 15 injured by his reliance." 16 App. 4th 218, 225 (Ct. App. 2011). 17 Plaintiff has failed to allege a clear and unambiguous promise or 18 justified reliance on that promise. 19 does not allege that Defendant promised that if she defaulted on 20 her loan, she would necessarily qualify for a modification; 21 rather, she appears to allege that significant default was one of 22 several requirements for placement in Defendant's in-house loan 23 modification program. 24 clear and unambiguous promise or justified reliance on that 25 promise. 26 LEAVE TO AMEND. 27 /// 28 /// Aceves v. U.S. Bank, N.A., 192 Cal. Defendant argues that The Court agrees. Plaintiff Therefore, Plaintiff has failed to allege a Accordingly, Plaintiff's third claim is DISMISSED WITH 10 1 C. Plaintiff's Loan Origination Claims 2 Plaintiff's eighth and ninth claims concern statements Joson 3 allegedly made to her in 2006 during the origination of the loan. 4 In her eighth claim, Plaintiff alleges that Defendant's 5 representative intentionally misrepresented the terms of the loan 6 prior to closing in 2006. 7 is premised on this claim, as well as alleged violations of TILA. 8 Id. ¶¶ 78-84. 9 misrepresentations made more than five years ago is barred by the Id. ¶¶ 62-77. Plaintiff's ninth claim Defendant argues that any claim based on alleged United States District Court For the Northern District of California 10 applicable statutes of limitations.4 11 alleges that to the extent Plaintiff suggests these claims did not 12 accrue until Plaintiff discovered them "within the past three 13 years," she must allege specific facts supporting delayed accrual. 14 Id. (citing California Sansome Co. v. U.S. Gypsum, 55 F.3d 1402, 15 1407 (9th Cir. 1995)). 16 had an opportunity to inspect the loan documents upon closing in 17 2006, her failure to review them and discover the alleged fraud 18 does not support delayed accrual. MTD at 12. Defendant Defendant argues that because Plaintiff Id. Defendant correctly represents the standard for pleading 19 20 delayed accrual. "A plaintiff whose complaint shows on its face 21 that his or her claim would be barred by the applicable orthodox 22 statute of limitations, and who intends to rely on the discovery 23 rule to toll the orthodox limitation period, must specifically 24 25 26 27 28 4 Fraud claims are subject to a three-year statute of limitations. Cal. Civ. Proc. Code § 338. Claims under section 17200 are subject to a four-year statute of limitations. Cal. Bus. & Prof. Code § 17208. A claim of violation of TILA is subject to a three-year statute of repose. 15 U.S.C. § 1635(f). 11 1 plead facts which show (1) the time and manner of discovery and 2 (2) the inability to have made earlier discovery despite 3 reasonable diligence. 4 discovery was reasonable are insufficient." 5 Tech. Corp., 230 Cal. App. 3d 1525, 1536-37 (Ct. App. 1991). 6 her Opposition, Plaintiff repeats the allegation in her Complaint 7 that "[d]iscovery of the misrepresentation was made within 3 years 8 from the filing of the Complaint." 9 is unsatisfactory. Mere conclusory assertions that delay in Camsi IV v. Hunter MTD Opp'n at 4. In This response Because Plaintiff has failed to allege United States District Court For the Northern District of California 10 specific facts that plausibly support delayed accrual, the Court 11 DISMISSES WITH LEAVE TO AMEND Plaintiff's eighth claim. 12 extent that Plaintiff's section 17200 claim is premised on fraud 13 in loan origination or violation of TILA, this claim is also 14 DISMISSED WITH LEAVE TO AMEND. To the 15 D. 16 Defendant additionally argues that "[a]ll of Plaintiff's 17 claims challenging the fees, terms and interest rate of the loan 18 and those based on allegations of misconduct in connection with 19 the foreclosure proceedings" are preempted by the Home Owners' 20 Loan Act ("HOLA"). 21 are also subject to dismissal as preempted under HOLA, the Court 22 addresses this argument. 23 HOLA Preemption MTD at 17. Because many of Plaintiff's claims Congress enacted HOLA "to charter savings associations under 24 federal law, at a time when record numbers of homes were in 25 default and a staggering number of state-chartered savings 26 associations were insolvent." 27 F.3d 1001, 1004 (9th Cir. 2008). Silvas v. E*Trade Mortg. Corp., 514 HOLA gives the Office of Thrift 28 12 1 Supervision ("OTS") "broad authority to issue regulations 2 governing thrifts." Id. at 1005 (citing 12 U.S.C. § 1464). OTS, in turn, has promulgated regulations stating that OTS 3 4 "occupies the entire field of lending regulation for federal 5 savings associations." 6 Section 560.2 offers a framework for determining whether a state 7 law claim is preempted by HOLA and its implementing regulations, 8 and the Ninth Circuit has held that this framework controls. 9 Silvas, 514 F.3d at 1005. 12 C.F.R. § 560.2(a) ("section 560.2"). Courts must first determine whether the United States District Court For the Northern District of California 10 state law is one of the enumerated types of laws expressly 11 identified as preempted in section 560.2(b). 12 "[p]rocessing, origination, servicing, sale or purchase of, or 13 investment or participation in, mortgages." 14 560.2(b)(10). Id. These include 12 C.F.R. § If the state law is one of these enumerated types, "the 15 16 analysis will end there; the law is preempted." Silvas, 514 F.3d 17 at 1005. 18 affects lending." 19 preempted, subject to the exceptions provided by section 560.2(c). 20 Id. If not, the court should determine "whether the law Id. If it does, the law is presumed to be Section 560.2(c) provides: 23 State laws of the following types are not preempted to the extent that they only incidentally affect the lending operations of Federal savings associations or are otherwise consistent with the purposes of [section 560.2(a)]: 24 (1) Contract and commercial law; 25 (2) Real property law; 26 (3) Homestead laws specified in 12 U.S.C. § 1462a(f); 27 (4) Tort law; 28 (5) Criminal law; and 21 22 13 1 (6) Any other law that OTS, upon review, finds: 2 (i) Furthers a vital state interest; and 3 (ii) Either has only an incidental effect on lending operations or is not otherwise contrary to the purposes expressed in paragraph (a) of this section. 4 5 6 12 C.F.R. § 560.2(c). 7 narrowly." 8 9 These exceptions are "to be interpreted Silvas, 514 F.3d at 1005. Defendant argues that Plaintiff's claims are preempted under section 560.2(b)(10). MTD at 17. Wells Fargo argues that United States District Court For the Northern District of California 10 Plaintiff's chief allegations of wrongdoing -- that Defendants 11 committed fraud, acted in bad faith, or otherwise violated the law 12 during the loan modification discussions and the foreclosure 13 procedure -- concern "processing" or "servicing" of the mortgage 14 and thus compel preemption. 15 cogent response. 16 Id. Plaintiff does not offer a While HOLA does preempt some of Plaintiff's claims, HOLA 17 preemption is not as broad as Wells Fargo argues it is. In 18 Silvas, the Ninth Circuit focused not on the nature of the cause 19 of action allegedly preempted, but rather on the "functional 20 effect upon lending operations of maintaining the cause of 21 action." 22 2009 WL 2870620, at *4 (N.D. Cal. Sep. 3, 2009). 23 was rather whether an application of a given state law to the 24 activities of federal savings associations would 'impose 25 requirements' regarding the various activities broadly regulated 26 by the OTS." 27 preempt all state law causes of action arising out of loan 28 modification and/or foreclosure proceedings, but only those that 14 Naulty v. GreenPoint Mortg. Funding, Inc., No. 09-1542, Id. "The question Courts have thus interpreted Silvas to not 1 impose new requirements on the lender. 2 Fargo Bank, N.A., No. 11-1814, 2011 WL 2471167, at *4-6 (C.D. Cal. 3 June 21, 2011) (denying bank's motion to dismiss borrower's breach 4 of contract, negligence, bad faith, and fraud claims as preempted 5 by HOLA). 6 E.g., Susilo v. Wells To the extent that Plaintiff's claims are premised on fraud or 7 promises made by Wells Fargo, such claims are not necessarily 8 preempted, because the only "requirement" they impose on federal 9 savings banks is that they be held responsible for the statements United States District Court For the Northern District of California 10 they make to their borrowers. 11 preempted, federal savings associations would be free to lie to 12 their customers with impunity. 13 allegations that Wells Fargo failed to use proper care or comply 14 with industry standards essentially seek to impose new 15 requirements on the lender and are thus preempted by HOLA. 16 such, Plaintiff's negligent misrepresentation claim is preempted 17 by HOLA. 18 If these causes of action were On the other hand, Plaintiff's As In sum, Plaintiff's Complaint falls far short of federal 19 pleading standards. 20 Complaint to address the above shortcomings, she is put on notice 21 that any claims dismissed on a subsequent motion to dismiss will 22 be dismissed WITHOUT LEAVE TO AMEND. 23 additional leave to amend the complaint if Plaintiff files a 24 motion under Rule 15(a)(2) of the Federal Rules of Civil Procedure 25 establishing that justice requires it. 26 While Plaintiff is granted leave to amend her The Court will only grant Furthermore, the Court puts Plaintiff and her attorney on 27 notice that under 28 U.S.C. § 1927, "[a]ny attorney . . . who so 28 multiplies the proceedings in any case unreasonably and 15 1 vexatiously may be required by the court to satisfy personally the 2 excess costs, expenses, and attorneys' fees reasonably incurred 3 because of such conduct." 4 sponte. 5 210 F.3d 1112, 1118 (9th Cir. 2000). 6 frivolous arguments in her amended complaint or pleads any clearly 7 meritless claims, she and her counsel may be subject to sanctions 8 under 28 U.S.C. § 1927, Federal Rule of Civil Procedure 11, the 9 Court's local rules, and the Court's inherent power. The Court may impose such sanctions sua Pacific Harbor Capital, Inc. v. Carnival Air Lines, Inc., If Plaintiff makes any United States District Court For the Northern District of California 10 11 12 V. CONCLUSION For the foregoing reasons, the Court GRANTS the motion to 13 dismiss filed by Defendant Wells Fargo Bank, N.A. Plaintiff Lorda 14 Rumbaua's first, fourth, fifth, sixth, and seventh claims are 15 DISMISSED WITH PREJUDICE. 16 ninth claims are DISMISSED WITH LEAVE TO AMEND. 17 Defendant's motion to strike as moot in light of this Order. 18 Plaintiff is granted thirty (30) days' leave to file an amended 19 complaint. 20 this time frame, this action will be dismissed WITH PREJUDICE. Plaintiff's second, third, eighth, and The Court DENIES If Plaintiff fails to file an amended complaint within 21 22 IT IS SO ORDERED. 23 24 25 Dated: August 25, 2011 UNITED STATES DISTRICT JUDGE 26 27 28 16
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