Calderon et al v. Endres et al, No. 3:2009cv00874 - Document 7 (S.D. Cal. 2009)
Court Description: ORDER granting 2 Motion to Dismiss the First Amended Complaint as to only Defendant Deutsche Bank. Signed by Judge Marilyn L. Huff on 07/07/09. (All non-registered users served via U.S. Mail Service).(ag) (jrl).
Download PDF
<![CDATA[
Calderon et al v. Endres et al Doc. 7 1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 SOUTHERN DISTRICT OF CALIFORNIA 9 10 AXEL E. CALDERON; and PAULA E. RIVERA, CASE NO. 09-CV-00874-H (JMA) 11 Plaintiff, 12 13 14 15 16 17 ORDER GRANTING DEFENDANT DEUTSCHE BANK’S MOTION TO DISMISS vs. DAVID R. ENDRES, APC; DEUTSCHE BANK NATIONAL TRUST COMPANY; ETS SERVICES, LLC; NEW CENTURY MORTGAGE CORPORATION; NC INSURANCE SERVICES, INC. dba HOME 123 INSURANCE SERVICES; THE ENDRES LAW FIRM; and DOES 1 through 10, 18 Defendants. 19 20 On April 27, 2009, Defendant Deutsche Bank National Trust Company as Trustee under 21 Pooling and Servicing Agreement dated as of March 1, 2007 Securitized Asset Backed 22 Receivables LLC Trust 2007-BR1 (“Deutsche Bank”), erroneously named as “Deutsche Bank 23 National Trust Company,” removed this case from the California Superior Court in and for the 24 County of San Diego. (Doc. No. 1.) On April 28, 2009, Defendant Deutsche Bank filed a 25 motion to dismiss Plaintiffs Axel Calderon and Paula Rivera’s (“Plaintiffs”) first amended 26 complaint (“FAC”). (Doc. No. 2.) Plaintiffs, proceeding pro se, did not file a response in 27 opposition. 28 The Court, pursuant to its discretion under Local Rule 7.1(d)(1), determined this matter -1- 09cv874 Dockets.Justia.com 1 is appropriate for resolution without oral argument and submitted the matter on the papers on 2 June 25, 2009. (Doc. No. 6.) For the reasons set forth below, the Court grants Defendant 3 Deutsche Bank’s motion to dismiss. Background 4 5 Plaintiffs’ FAC arises from foreclosure proceedings on their home. The caption on 6 Plaintiffs’ FAC lists causes of action for (1) request for promissory note; (2) violation of 7 GAAP, RESPA, TILA and California UCC; and (3) violation of the Fair Debt Collection 8 Practices Act. (Doc. No. 1, Ex. A, FAC.) It also appears from Plaintiffs’ FAC that Plaintiffs 9 allege a violation of California Civil Code § 2923.5. (Id.) 10 In or about October 10, 2006, Plaintiffs sought and obtained a refinance loan secured 11 by real property located at 672 Elaine Avenue, Oceanside, California 92057 (the “Property”). 12 (Id. at 1-2; Doc. No. 2, Ex. 1.) Plaintiffs executed an Adjustable Rate Note (“Note”) promising 13 to repay $504,000 to Defendant New Century Mortgage Corporation, which was secured by 14 a Deed of Trust on the Property. (Doc. No. 2, Exs. 1 & 2.) The Deed of Trust was recorded 15 in the San Diego County Recorder’s Office at Document No. 2006-0750689 on October 23, 16 2006. (Id. Ex. 2.) The Deed of Trust provided that Mortgage Electronic Registration Systems, 17 Inc. was acting as nominee for the lender as beneficiary under the security agreement. (Id. Ex. 18 2.) 19 On August 16, 2007, due to Plaintiffs’ failure to comply with the terms of the Loan, 20 foreclosure proceedings against the Property were initiated with the recording of a Notice of 21 Default and Election to Sell Under Deed of Trust (“Notice of Default”) in the San Diego 22 County Recorder’s Office at Document No. 2007-0547738. (Id. Ex. 3.) A substitution of 23 Trustee was recorded in the San Diego County Recorder’s Office on May 6, 2008, at 24 Document No. 2008-0241642, which substituted Defendant Executive Trustee Services, LLC 25 as the new Trustee under the Deed of Trust. (Id. Ex. 4.) On August 8, 2008, a Notice of 26 Trustee’s Sale was recorded at Document No. 2008-0424152 in the San Diego County 27 Recorder’s Office. (Id. Ex. 5.) 28 Defendant Deutsche Bank purchased the Property. (Id. Ex. 6.) The Trustee’s Deed Upon Sale The foreclosure sale occurred on October 1, 2008, where -2- 09cv874 1 was recorded in the San Diego County Recorder’s Office on October 21, 2008 at Document 2 No. 2008-0546596. (Id. Ex. 6.) 3 Plaintiffs filed their amended complaint on January 30, 2009. (Doc. No. 1, Ex. A, 4 FAC.) Defendant Deutsche Bank now moves to dismiss Plaintiffs’ FAC for failure to state a 5 claim upon which relief may be granted. (Doc. No. 2.) Defendant Deutsche Bank also filed 6 a request for judicial notice of the various documents filed with the San Diego County 7 Recorder’s Office and a copy of a Debt Elimination Scams alert published by the Office of the 8 Comptroller of Currency. (Doc. No. 2, Exs. 1-7.) 9 10 Discussion I. Motion to Dismiss Pursuant to 12(b)(6) 11 A motion to dismiss a complaint under Federal Rule of Civil Procedure 12(b)(6) tests 12 the legal sufficiency of the claims asserted in the complaint. Navarro v. Black, 250 F.3d 729, 13 731 (9th Cir. 2001). A complaint generally must satisfy only the minimal notice pleading 14 requirements of Federal Rule of Civil Procedure 8(a)(2) to evade dismissal under a Rule 15 12(b)(6) motion. Porter v. Jones, 319 F.3d 483, 494 (9th Cir. 2003). Rule 8(a)(2) requires that 16 a pleading stating a claim for relief contain “a short and plain statement of the claim showing 17 that the pleader is entitled to relief.” The function of this pleading requirement is to “give the 18 defendant fair notice of what the . . . claim is and the grounds upon which it rests.” Conley v. 19 Gibson, 355 U.S. 41, 47 (1957). “While a complaint attacked by a Rule 12(b)(6) motion to 20 dismiss does not need detailed factual allegations, a plaintiff’s obligation to provide the 21 ‘grounds’ of his ‘entitlement to relief’ requires more than labels and conclusions, and a 22 formulaic recitation of the elements of a cause of action will not do.” Bell Atlantic Corp. v. 23 Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1964–65 (2007). A complaint does not “suffice if 24 it tenders ‘naked assertion[s]’ devoid of ‘further factual enhancement.’” Ashcroft v. Iqbal, 129 25 S.Ct. 1937, 1949 (2009) (quoting id. at 556). “Factual allegations must be enough to raise a 26 right to relief above the speculative level.” Twombly, 127 S.Ct. at 1965 (citing 5 C. Wright 27 & A. Miller, Federal Practice and Procedure § 1216, pp. 235–36 (3d ed. 2004)). “All 28 allegations of material fact are taken as true and construed in the light most favorable to -3- 09cv874 1 plaintiff. However, conclusory allegations of law and unwarranted inferences are insufficient 2 to defeat a motion to dismiss for failure to state a claim.” Epstein v. Wash. Energy Co., 83 3 F.3d 1136, 1140 (9th Cir.1996); see also Twombly, 127 S.Ct. at 1964–65. 4 “Generally, a district court may not consider any material beyond the pleadings in ruling 5 on a Rule 12(b)(6) motion.” Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 6 1555 n .19 (9th Cir.1990). The court may, however, consider the contents of documents 7 specifically referred to and incorporated into the complaint. Branch v. Tunnell, 14 F.3d 449, 8 454 (9th Cir.1994). In evaluating a motion to dismiss, a court may consider evidence on 9 which the complaint “necessarily relies” as long as: (1) the complaint refers to the document; 10 (2) the document is central to the plaintiff’s claim; and (3) no party questions the authenticity 11 of the copy attached to the 12(b)(6) motion. Marder v. Lopez, 450 F.3d 445, 448 (9th Cir. 12 2006). Additionally, the Court may take judicial notice of matters of public record. See Lee 13 v. City of Los Angeles, 250 F.3d 668, 689–90 (9th Cir.2001). Thus, the Court takes judicial 14 notice of the various documents filed with the San Diego County Recorder’s Office that are 15 specifically referred to in Plaintiffs’ FAC and that are publicly filed documents. 16 Plaintiffs’ FAC is not an organized pleading enumerating causes of action and pleading 17 facts supporting such causes of action, but a series of paragraphs appearing to discuss actions 18 taken by various defendants named by the FAC interposed with quotations and citations to 19 various legal sources, many of which appear to be non-binding authority on this Court. The 20 Court, therefore, addresses the listed causes of action in the FAC caption and other possible 21 causes of action raised by Plaintiffs in the FAC. 22 A. Request for Promissory Note 23 Plaintiffs’ FAC states, “Plaintiff is requesting as to who has the original signed, and 24 sealed promissory note executed by Plaintiff in reference to the ‘property’ and this must be 25 answered therefore Plaintiff under the Federal Statutes has the right to demand the location of 26 their ‘note.’” (Doc. No. 1, Ex. A, FAC at 3.) Plaintiffs do not indicate what “Federal Statutes” 27 they are referring to, but Plaintiffs do cite to the Uniform Commercial Code § 3-309, which 28 addresses when a person not in possession of an instrument due to loss of possession, -4- 09cv874 1 destruction of the instrument, or lost instrument is entitled to enforce the instrument. 2 The California statute governing non-judicial foreclosure is codified in the California 3 Civil Code at § 2924, et seq. This statute establishes an exhaustive comprehensive statutory 4 framework governing non-judicial foreclosure sales and covers every aspect of exercise of the 5 power of sale contained in a deed of trust. Moeller v. Lien, 30 Cal.Rptr.2d 777 (Cal. Ct. App. 6 1994); I. E. Assocs. v. Safeco Title Ins. Co., 29 Cal.Rptr.438 (Cal. 1985). The statute does not 7 require the entity initiating the foreclosure sale to provide evidence to the borrower or a court 8 establishing its right to do so, nor does it require that entity to have possession of the note. 9 Because there is no evidence suggesting that Defendants do not have the right to foreclose on 10 the Property and Defendant Deutsche Bank did not have the right to buy the Property, 11 Plaintiffs’ allegation is purely speculative. Under Twombly, this allegation cannot survive a 12 motion to dismiss. 127 S.Ct. at 1965. Furthermore, because California law does not require 13 production of the original note in order to proceed with a non-judicial foreclosure, any claim 14 Plaintiffs base on the allegation that Defendant Deutsche Bank or any Defendant had to 15 produce the original Note to have foreclosed upon their home fails as a matter of law. CAL. 16 CIV. CODE §§2924(a), et seq. Accordingly, the Court grants Defendant Deutsche Bank’s 17 motion to dismiss any claim by Plaintiffs of wrongful foreclosure based upon failure to 18 produce the original Note. 19 B. Violation of GAAP, TILA, RESPA, and California UCC 20 Plaintiffs’ FAC lists violation of GAAP, TILA, RESPA, and California UCC in the 21 caption to the FAC. (See Doc. No. 1, Ex. A, FAC.) Plaintiffs fail to state a claim against 22 Defendant Deutsche under any of these theories. 23 1. Generally Accepted Accounting Principles (“GAAP”) 24 Plaintiffs’ FAC states that, “Plaintiff’s [sic] are requesting that defendants prove that 25 they are following GAAP and will that their books and records be produced as evidence of 26 this.” (Id. at 4.) The FAC further alleges that, “[t]he lenders violation of GAAP wherein they 27 create money is fraudulent conversion making the contract, which the bank created with their 28 policy of bookkeeping entries, illegal and the alleged contract is null and void.” (Id. at 7.) -5- 09cv874 1 These are the only two places where GAAP is mentioned in the FAC. These sparse allegations 2 are insufficient to give Defendant Deutsche Bank fair notice of what the claim is in relation 3 to GAAP and the grounds upon which it rests. See Conley, 355 U.S. at 47. 4 therefore fails to state a claim upon which relief may be granted for a violation of GAAP, as 5 Plaintiffs’ do not meet Rule 8(a)(2)’s requirement that a pleading stating a claim for relief 6 contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” 7 Accordingly, the Court dismisses Plaintiffs’ claim for a violation of GAAP against Defendant 8 Deutsche Bank. 9 The FAC 2. Truth in Lending Act (“TILA”) 10 Plaintiffs list a violation of the federal Truth in Lending Act (“TILA”), 15 U.S.C. §§ 11 1601, et seq., in the caption to their FAC, but TILA is not mentioned elsewhere in the FAC. 12 (See Doc. No. 1, Ex. A, FAC.) TILA seeks to protect credit consumers by mandating 13 “meaningful disclosure of credit terms.” 15 U.S.C. § 1601(a). Its provisions impose certain 14 duties on creditors. The statute itself defines “creditor” as referring only to “the person to 15 whom the debt arising from the consumer credit transaction is initially payable on the face of 16 the evidence of indebtedness.” 15 U.S.C. § 1602(f). TILA has been amended to extend 17 liability to assignees of the original creditor in certain situations. 15 U.S.C. § 1641(a). 18 However, this provision applies “only if the violation for which such action or proceeding is 19 brought is apparent on the face of the disclosure statement, except where the assignment was 20 involuntary.” Id. Plaintiffs do not allege that any TILA violation was apparent from the face 21 of the disclosure statement and does not attach any such disclosure statement to the FAC. 22 Moreover, Plaintiffs have not alleged what purported provisions of TILA Defendant Deutsche 23 Bank has allegedly violated, when such violations occurred, or what alleged conduct by 24 Defendant Deutsche Bank violates such provisions. Therefore, Plaintiffs have not stated a 25 claim under TILA entitling Plaintiffs to relief. Accordingly, the Court dismisses Plaintiffs’ 26 claim for a violation of TILA against Defendant Deutsche Bank. 27 Furthermore, the Court also notes that a request for any statutory damages under TILA 28 is subject to a one year statute of limitations, typically running from the date of the loan -6- 09cv874 1 execution. 15 U.S.C. §1640(e). Plaintiffs’ loan was executed in October 2006 and Plaintiffs 2 did not file this action until February 2009. (See Doc. No. 2, Ex. 1; Doc. No. 1, Ex. A, FAC.) 3 Thus, it appears that any request by Plaintiffs’ for damages under TILA is barred as a matter 4 of law. 5 Plaintiffs also ask the Court to order the foreclosure sale cancelled. (Id. at 12.) 6 However, the right of rescission under TILA terminates when the mortgage property is sold 7 at a foreclosure sale. 15 U.S.C. § 1635(f) (“[a]n obligor’s right of rescission shall expire three 8 years after the date of consummation of the transaction or upon the sale of the property, 9 whichever occurs first....”). The foreclosure sale occurred on October 1, 2008. (Doc. No. 2, 10 Ex. 6.) Therefore, Plaintiffs claim for rescission under TILA has expired and is barred as a 11 matter of law. 12 3. Real Estate Settlement Procedures Act (“RESPA”) 13 Plaintiffs’ FAC lists a violation of the federal Real Estate Settlement Procedures Act 14 (“RESPA”), 12 U.S.C. §2601, et seq., in the caption and alleges, “[s]omehow the total 15 ‘principle’ [sic] shows an amount of $504,000 and was allegedly done in accordance with 16 RESPA.” (Doc. No. 1, Ex. A, FAC at 2.) Plaintiffs allege that on or about October 10, 2006, 17 they signed a “Promissory Note” on Loan No. 1010155217 for $506,495.65. (Id.) Thus, 18 Plaintiffs appear to claim a violation of RESPA by contending the Note they signed reflected 19 the amount borrowed as $506,495.65 instead of $504,000. 20 The Note on Loan No. 101055217 states, “In return for a loan that I have received, I 21 promise to pay U.S. $504,000 (this amount to be called ‘principal’), plus interest to the order 22 of the Lender . . . I understand the Lender may transfer this Note.” (Doc. No. 2, Ex. 1.) The 23 Note is signed by Plaintiff Calderon. (Id.) The Court may disregard allegations in a complaint 24 if the allegations are contradicted by facts established in documents exhibited to or referenced 25 in the complaint, or documents that are central to a plaintiff’s claims even though not 26 referenced. See Durning v. First Boston Corp., 815 F.2d 1265, 1267 (9th Cir. 1987); Epstein, 27 83 F.3d at 1140 (“unwarranted inferences are insufficient to defeat a motion to dismiss for 28 failure to state a claim “); see also Twombly, 127 S.Ct. at 1964–65. Plaintiffs have not -7- 09cv874 1 attached to the FAC a copy of the Note showing the amount they believe to have been 2 borrowed on Loan No. 1010155217, and the copy of the Note provided by Defendant Deutsche 3 Bank bears Plaintiff Calderon’s signature. Because Plaintiffs’ FAC is directly contradicted by 4 the principal amount listed on the Note provided to the Court, the authenticity of which has not 5 been disputed, the Court dismisses Plaintiff’s RESPA claim based upon an alleged 6 misstatement of the amount borrowed. 7 Plaintiffs fail to allege any other conduct by Defendant Deutsche Bank or other 8 Defendants in violation of RESPA and fail to allege what provisions of RESPA Defendants 9 allegedly violated. The only other allegation in the FAC that appears directed at RESPA 10 states, “The servicing agent has 60 days to give defendant the owners [sic] name after it is 11 requested, 12 U.S.C.A. ‘servicing agents.’” (Doc. No. 1, Ex. A, FAC at 5.) This allegation, 12 which appears to be more a statement of law than an allegation of conduct by any Defendant, 13 is insufficient to state a claim under RESPA. 14 4. California Uniform Commercial Code (“UCC”) 15 Plaintiffs include in their FAC caption “violation of California UCC” and make various 16 references to the UCC in their FAC. Plaintiffs state, “If in fact under CUCC 3-309(a) ‘a 17 person not in possession of an instrument may enforce it only if s/he was in possession of the 18 instrument at the time of loss of possession.’” (Doc. No. 1, Ex. A, FAC at 3.) Plaintiffs’ FAC 19 also alleges that, “No consideration was given as required by the UCC.” (Id. at 4.) Plaintiffs 20 allege, quoting a District of New Jersey case, “Under the Uniform Commercial Code the only 21 notice sufficient to inform all interested parties that a security interest in instruments has been 22 perfected is actual possession by the secured party, his agent or bailee.” (Id. at 5.) 23 These allegations, although not clear, seem to allege a violation of the UCC based upon 24 failure of Defendants to produce the original Note. California law does not require production 25 of the original note in order to proceed with a non-judicial foreclosure. CAL. CIV. CODE 26 §§2924(a), et seq. Accordingly, any claim Plaintiffs base on the allegation that Defendant 27 Deutsche Bank or any Defendant had to produce the original Note under the UCC to have 28 foreclosed upon their home fails as a matter of law. The Court dismisses any claim Plaintiffs -8- 09cv874 1 bring against Defendant Deutsche Bank based upon a violation of the UCC. 2 C. Violation of Fair Debt Collection Practices Act 3 Plaintiffs include in their FAC caption a violation of the Fair Debt Collection Practices 4 Act (“FDCPA”), 15 U.S.C. §§1692, et seq. (Doc. No. 1, Ex. A, FAC.) Plaintiffs allegations 5 in regards to this cause of action state: 6 ETS Services, LLC, New Service Mortgage Corporation, NC Services, Inc. and 7 Defendants to be named later are in violation of Title VIII-Debt Collection 8 Practices [Fair Debt Collection Practices Act] § 803. Definitions [15 U.S.C. 9 1692a] As used in this title– (6) The term “debt collector” means any person 10 who uses any instrumentality of interstate commerce or the mails in any business 11 in the principal purpose of which is the collection of any debts, or who regularly 12 collects or attempts to collect, directly or indirectly, debts owed or due or 13 asserted to be owed or due another. 14 (Id. at 8-9.) Plaintiffs do not allege that Defendant Deutsche Bank is a “debt collector” within 15 the meaning of the statute. In addition to not meeting the pleading requirements under the 16 FDCPA’s definition of “debt collector,” Plaintiffs fail to plead what provisions of these acts 17 Deutsche Bank allegedly violated and facts supporting any violations. Deutsche Bank is not 18 even included in the list of Defendants alleged to be “in violation” of the FDCPA. A 19 conclusory statement by a plaintiff that the defendant has violated a statute, without more, is 20 insufficient to survive a motion to dismiss. See, Metzler Inv. GMBH v. Corinthian Colleges, 21 Inc., 540 F.3d 1049, 1064-65 (9th Cir. 2008). Accordingly, the Court dismisses Plaintiffs’ 22 cause of action against Defendant Deutsche Bank for violation of FDCPA for failing to state 23 a claim. 24 D. Violation of California Civil Code § 2923.5 25 Although not listed in the FAC caption, Plaintiffs’ FAC raises California Civil Code § 26 2923.5. Plaintiffs allege that, “Plaintiff was not sent a Declaration Pursuant to California Civil 27 section 2923.5(c) by ETS Services, LLC.” (Doc. No. 1, Ex. A, FAC at 2.) Plaintiffs allege 28 that, “[t]his paper would state under number 1, ‘Contact was made with the borrower to assess -9- 09cv874 1 their financial situation and to explore options for the borrower to avoid foreclosure.’ Or 2 number 2. ‘No contact was made with the borrower to assess their financial situation and to 3 explore options to avoid foreclosure.” (Id.) Plaintiffs further allege that, “since ETS Services, 4 LLC did not in any of their papers attempt to obey California Civil section 2923.5(c) and 5 discuss negotiations were which were to rescue the mortgage owner as the mortgage owners 6 were looking for assistance so that they would not lose their property.” (Id.) 7 The Court dismisses any claim against Defendant Deutsche Bank under California Civil 8 Code § 2923.5. Plaintiffs’ allegations in connection with § 2923.5 are aimed at ETS Services, 9 LLC and do not allege that Defendant Deutsche Bank failed to comply with § 2923.5. 10 Furthermore, it appears Defendants were not obligated to comply with § 2923.5. Section 11 2923.5 became operative September 6, 2008 and states: 12 If a mortgagee, trustee, beneficiary, or authorized agent had already filed the 13 notice of default prior to the enactment of this section and did not subsequently 14 file a notice of rescission, then the mortgagee, trustee, beneficiary, or authorized 15 agent shall, as part of the notice of sale filed pursuant to Section 2924f, include 16 a declaration that either: 17 (1) States that the borrower was contacted to assess the borrower's financial 18 situation and to explore options for the borrower to avoid foreclosure. 19 (2) Lists the efforts made, if any, to contact the borrower in the event no contact 20 was made. 21 Cal. Civ. Code § 2923.5(c). In a letter to the California Senate, the author of the statute 22 specifically stated that, “it is not intended that Section 2923.5(c) apply to those situations 23 where a notice of sale has already been recorded prior to the operative date of this section.” 24 Letter from Don Perata, President Pro Tempore of the California State Senate, to Gregory 25 Schmidt, Secretary of the California State Senate (Aug. 29, 2008) (published in The Senate 26 Daily Journal for the 2007-2008 Regular Session, pp. 5431-32.) The Notice of Default in this 27 case was recorded on August 16, 2007, prior to the passage of § 2923.5 on July 8, 2008, and 28 the Notice of Sale was recorded on August 8, 2008, prior to the operative date of the statute - 10 - 09cv874 1 on September 6, 2008. (Doc. No. 3, Exs. 3 & 5.) Thus, it appears that Plaintiffs cannot state 2 a claim for relief under § 2923.5(c). Conclusion 3 4 For the reasons set forth above, the Court GRANTS Defendant Deutsche Bank’s motion 5 to dismiss the FAC. As it does not appear that Plaintiffs may cure the deficiencies, the Court 6 declines to grant leave to amend as to this Defendant. 7 8 IT IS SO ORDERED. DATED: July 7, 2009 ______________________________ 9 MARILYN L. HUFF, District Judge UNITED STATES DISTRICT COURT 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 11 - 09cv874
]]>
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You
should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
