Hernandez v. Recontrust Company et al, No. 3:2008cv01899 - Document 8 (S.D. Cal. 2009)
Court Description: ORDER Granting 4 Motion to Dismiss and Denying Motion for a More Definite Statement As Moot. Plaintiff's Complaint is dismissed without prejudice. The Court grants Plaintiff leave to file an amended complaint. Any amended complaint must be f iled within 30 days of the filing of this order. If Plaintiff does not file an amended complaint within the prescribed time, the Court shall order the Clerk to enter judgment dismissing this case without prejudice, and the case shall be closed. Signed by Judge Barry Ted Moskowitz on 2/2/09. (vet)
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Hernandez v. Recontrust Company et al Doc. 8 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 GABRIEL HERNANDEZ, CASE NO. 08cv1899 BTM(POR) Plaintiff, 12 ORDER GRANTING MOTION TO DISMISS AND DENYING MOTION FOR MORE DEFINITE STATEMENT AS MOOT vs. 13 14 15 16 RECONSTRUCT COMPANY, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. C/O COUNTRYWIDE HOME LOANS, INC., and DOES 1-50, inclusive Defendants. 17 18 Defendants Reconstruct Company (“Reconstruct”) and Countrywide Home Loans, Inc. 19 (“Countrywide”) (“Defendants”), have filed a motion to dismiss the complaint, or, in the 20 alternative, for a more definite statement. For the reasons discussed below, Defendants’ 21 motion to dismiss is GRANTED and Defendants’ motion for a more definite statement is 22 DENIED AS MOOT. 23 24 I. BACKGROUND 25 On September 4, 2008, Plaintiff commenced this action in the Superior Court of 26 California, County of San Diego - North County. On October 16, 2008, Defendants removed 27 the action to federal court. 28 Plaintiff Gabriel Hernandez is the owner of the real property located at 12132 Lilac 1 08cv1997 BTM(WMc) Dockets.Justia.com 1 Knolls, Valley Center, California 92082. (Compl. ¶ 6.) Plaintiff alleges that Defendants are 2 proceeding toward a Trustee’s sale of the Property (Compl. ¶ 5.) Plaintiff alleges, “Upon 3 information and belief, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. C/O 4 COUNTRYWIDE HOME LOANS, INC., is not the holder of the note identified in the security 5 instrument, is not in possession of the note properly endorsed to it, nor is it otherwise entitled 6 by law in this State to initiate foreclosure under the security instrument identified in Exhibit 7 1.” (Compl. ¶ 7.) Plaintiff claims that Countrywide has no right to initiate foreclosure or direct 8 Reconstruct to foreclose or sell the Property. (Compl. ¶ 8.) 9 Plaintiff alleges that although his attorney demanded proof of Defendants’ right to 10 proceed in foreclosure, Defendants have not offered any proof. (Compl. ¶ 10.) Plaintiff 11 further alleges that his attorney demanded a detailed accounting of the amount Defendants 12 stated must be paid to redeem the Property from foreclosure. (Compl. ¶ 11.) According to 13 Plaintiff, any response by Defendants has been so inadequate that Plaintiff has been 14 prevented from determining whether any or all of the charges included in the payoff demand 15 were justified. (Id.) Plaintiff also alleges that Defendants added costs and charges to the 16 payoff amount that were not justified and proper under the terms of the note or the law. 17 (Compl. ¶ 17.) 18 19 The Complaint sets forth the following causes of action: (1) unfair debt collection practices; (2) predatory lending practices; and (3) RICO violations. 20 21 II. STANDARD 22 Under Fed. R. Civ. P. 8(a)(2), the plaintiff is required only to set forth a “short and plain 23 statement” of the claim showing that plaintiff is entitled to relief and giving the defendant fair 24 notice of what the claim is and the grounds upon which it rests. Conley v. Gibson, 355 U.S. 25 41, 47 (1957). A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) should 26 be granted only where a plaintiff's complaint lacks a "cognizable legal theory" or sufficient 27 facts to support a cognizable legal theory. Balistreri v. Pacifica Police Dept., 901 F.2d 696, 28 699 (9th Cir. 1988). When reviewing a motion to dismiss, the allegations of material fact in 2 08cv1997 BTM(WMc) 1 plaintiff’s complaint are taken as true and construed in the light most favorable to the plaintiff. 2 See Parks Sch. of Bus., Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). Although 3 detailed factual allegations are not required, factual allegations ”must be enough to raise a 4 right to relief above the speculative level.” Bell Atlantic v. Twombly, 550 U.S. 544, 127 S.Ct. 5 1955, 1965 (2007). 6 relief’ requires more than labels and conclusions, and a formulaic recitation of the elements 7 of a cause of action will not do.” Id. “A plaintiff’s obligation to prove the ‘grounds’ of his ‘entitle[ment] to 8 9 III. DISCUSSION 10 Defendants move to dismiss Plaintiff’s Complaint for failure to state a claim, or, in the 11 alternative, for a more definite statement. The Court grants Defendants’ motion to dismiss 12 because although Plaintiff generally alleges violations of certain statutes, Plaintiff fails to 13 allege how Defendants violated the statutes and/or fails to plead sufficient facts establishing 14 a violation. 15 16 A. Unfair Debt Collection Practices 17 Plaintiff alleges that Defendants have violated “provisions of California’s Rosenthal 18 Fair Debt Collection Practices Act (“RFDCPA”), including but not limited to Civil Code § 1788 19 (e) and (f), and the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C., Title 41, 20 Subchap. V. §§ 1692 et seq. and the Real Estate Settlement Procedures Act (“RESPA”), 12 21 U.S.C. §§ 2601-2617.” (Compl. ¶ 20.) 22 With respect to the FDCPA and the RESPA, Plaintiff does not specify what 23 provision(s) of these acts Defendants violated or what Defendants did to violate the acts. To 24 the extent Plaintiff claims that Defendants violated the RESPA, 12 U.S.C. § 2605(e), by 25 failing to take action with respect to Plaintiff’s August 29, 2008 inquiry (Ex. 1 to the Compl.), 26 Plaintiff’s claim was premature. Under § 2605(e), after a servicer of a federally related 27 mortgage loan receives a qualified written request from the borrower for information relating 28 to the servicing of such loan, the servicer shall provide a written response acknowledging 3 08cv1997 BTM(WMc) 1 receipt of the correspondence within 20 days and must take action on the request within 60 2 days. Plaintiff filed his Complaint on September 4, 2008, less than a week after making his 3 inquiry. 4 As for Plaintiff’s claim under California’s Rosenthal Fair Debt Collection Practices Act, 5 Plaintiff cites to Cal. Civ. Code § 1788 (e) and (f). The Court assumes that Plaintiff intended 6 to cite to Cal. Civ. Code § 1788.10(e) and (f) (there is no § 1788(e) or (f)). Subsection (e) 7 provides that no debt collector shall collect or attempt to collect a consumer debt by “the 8 threat to any person that nonpayment of the consumer debt may result in . . . the seizure, 9 garnishment, attachment or sale of any property . . . unless such action is in fact 10 contemplated by the debt collector and permitted by the law.” Subsection (f) prohibits the 11 collection or attempted collection of debts by “[t]he threat to take any action against the 12 debtor which is prohibited by this title.” 13 The Complaint does not allege facts establishing a violation of subsections (e) and/or 14 (f). Plaintiff contends that the foreclosure of their home is not permitted by law because 15 Countrywide is not the holder of the note identified in the security instrument. (Compl. ¶¶ 7- 16 8.) However, it appears that Plaintiff is just speculating that Countrywide lacks legal authority 17 to foreclose on the Property due to an invalid assignment of rights or otherwise. Plaintiff 18 does not provide any facts in support of his allegations and, instead, relies upon mere 19 “information and belief.” (Compl. ¶ 7.) These allegations do not raise Plaintiff’s right to relief 20 above a speculative level. To the extent that Plaintiff contends that Countrywide must 21 possess the original note to initiate foreclosure proceedings, Plaintiff has not cited legal 22 authority supporting such a dubious proposition. 23 Plaintiff has not stated a claim against Defendants under the FDCPA, RESPA, or the 24 RFDCPA. Therefore, the Court grants Defendants’ motion as to Plaintiff’s Unfair Debt 25 Collection Practices Act cause of action. 26 27 28 B. Predatory Lending Practices Plaintiff alleges that Countrywide Bank, FSB, the original lender, engaged in deceptive 4 08cv1997 BTM(WMc) 1 practices “in violation of the Home Ownership and Equity Protection Act (“HOEPA”), 15 2 U.S.C. § 1637, the Truth in Lending Act (“TILA”), 15 U.S.C. § 1601, Regulation Z, 12 C.F.R. 3 226, and the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. §§ 41-58, the specifics 4 of which are unknown, but which are subject to discovery and with respect to which the 5 specifics will be alleged by amendment to this complaint when ascertained.” (Compl. ¶ 23.) 6 Plaintiff further alleges that Countrywide is “subject to defenses that would have been 7 available against Countrywide Bank, FSB.” (Compl. ¶ 22.) 8 Plaintiff’s vague allegation of predatory lending practices is insufficient to state a claim. 9 Plaintiff states that he does not know the “specifics” of the predatory lending practices. 10 However, it appears that Plaintiff does not even know the broad outlines of the alleged 11 conduct because Plaintiff does not allege any facts in support of this claim. Accordingly, the 12 Court grants Defendants’ motion to dismiss as to this claim. 13 14 C. RICO 15 Plaintiff alleges that Defendants violated RICO, 18 U.S.C. §§ 1961, et seq., by 16 participating in a scheme of racketeering. (Comp. ¶ 26.) Again, Plaintiff does not specify 17 what provision of the RICO statute Defendants allegedly violated, nor do they allege the 18 elements of a civil RICO claim – i.e., (1) conduct (2) of an enterprise (3) through a pattern 19 (4) of racketeering activity (5) causing injury to plaintiff’s business or property. Living 20 Designs, Inc. v. E.I. Dupont de Nemours & Co., 431 F.3d 353, 361 (9th Cir. 2005). 21 22 23 24 25 26 Based on Ex. 2 to the Complaint, it appears that Plaintiff claims that Defendants are in violation of 18 U.S.C. § 1962, which provides: It shall be unlawful for any person who has received any income derived, directly or indirectly, from a pattern of racketeering activity or through collection of an unlawful debt in which such person has participated as a principal within the meaning of section 2, title 18, United States Code, to use or invest, directly or indirectly, any part of such income, or the proceeds of such income, in acquisition of any interest in, or the establishment or operation of, any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce. 27 Although Plaintiff makes the conclusory claim that Defendants “have participated in a 28 scheme of racketeering,” Plaintiff fails to identify the predicate acts that form the basis of the 5 08cv1997 BTM(WMc) 1 alleged “scheme of racketeering.” See Izenberg v. ETS Services, LLC, __ F. Supp. 2d __, 2 2008 WL 5179088 at *7 (C.D. Cal. Dec. 8, 2008). Similarly, there are no facts establishing 3 collection of an “unlawful debt.” An “unlawful debt” means a debt (a) incurred or contracted 4 in gambling activity which was in violation of the law; and (b) which was incurred in 5 connection with the business of gambling in violation of the law or the business of lending 6 money at a usurious rate at least twice the enforceable rate. 18 U.S.C. § 1961(6). It does 7 not appear that the debt at issue here falls within the definition of 18 U.S.C. § 1961(6). 8 Therefore, this cause of action is dismissed for failure to state a claim.1 9 10 IV. CONCLUSION 11 For the reasons discussed above, Defendants’ motion to dismiss is GRANTED and 12 Defendants’ motion for more definite statement is DENIED AS MOOT. Plaintiff’s Complaint 13 is DISMISSED WITHOUT PREJUDICE. The Court grants Plaintiff leave to file an amended 14 complaint addressing the deficiencies identified above. Any amended complaint must be 15 filed within 30 days of the filing of this order. If Plaintiff does not file an amended complaint 16 within the prescribed time, the Court shall order the Clerk to enter judgment dismissing this 17 case without prejudice, and the case shall be closed. 18 IT IS SO ORDERED. 19 DATED: February 2, 2009 20 Honorable Barry Ted Moskowitz United States District Judge 21 22 23 24 25 26 27 1 28 In the body of their motion papers, Defendants ask the Court to strike Plaintiff’s prayer for attorney fees and treble damages. This request to strike is denied as moot in light of the dismissal of the Complaint. 6 08cv1997 BTM(WMc)
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