Kemberling v. Ocwen Loan Servicing, LLC et al, No. 2:2009cv00567 - Document 39 (D. Nev. 2009)
Court Description: ORDER Granting 30 Motion to Strike. Granting 7 Motion to Dismiss. Granting 8 Motion to Dismiss. Denying as Moot 13 Motion to Remand to State Court. Plaintiff's "Certificate of Protest under Notary Seal" is stricken. Signed by Judge Robert C. Jones on 10/26/09. (Copies have been distributed pursuant to the NEF - AXM)
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Kemberling v. Ocwen Loan Servicing, LLC et al Doc. 39 1 2 3 4 UNITED STATES DISTRICT COURT 5 DISTRICT OF NEVADA 6 CLIFFORD RANDALL KEMBERLING, Plaintiff, 7 8 9 10 11 12 13 vs. OCWEN LOAN SERVICING, LLC, FREMONT REORGANIZING CORPORATION formerly known as FREMONT INVESTMENT & LOAN, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., AZTEC FORECLOSURE CORPORATION, INC., HSBC Bank USA, N.A., ACE SECURITIES CORP. HOME EQUITY LOAN TRUST, Series 2005-HE6, and DOES 1 through 10 inclusive and ROE Corporations 1 through 10 inclusive, 14 Defendants. 15 16 ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) 2:09-CV-00567-RCJ-LRL ORDER I. INTRODUCTION 17 This is a mortgage foreclosure case. Before the Court is Defendant Fremont Reorganizing 18 Corp.’s Motion to Dismiss (#7) pursuant to Federal Rule of Civil Procedure 12(b)(6), Defendant 19 Ocwen, HSBC Bank, and MERS’s Motion to Dismiss and Strike (#8) pursuant to Federal Rule of 20 Civil Procedure 12(b)(6) and (f), Plaintiff’s Motion to Remand (#13), and Defendant Fremont’s 21 Motion to Strike (#30). 22 The Court has considered Defendant’s Motion and the pleadings on file on behalf of all 23 parties. IT IS HEREBY ORDERED that Defendant Fremont’s Motion to Dismiss (#7), Defendant 24 Ocwen et al.’s Motion to Dismiss and Strike (#8), and Defendant Fremont’s Motion to Strike (#30) 25 are GRANTED. Dockets.Justia.com 1 IT IS FURTHER ORDERED that Plaintiff’s Motion to Remand (#13) is DENIED as moot. 2 IT IS FURTHER ORDERED that Plaintiff’s “Certificate of Protest under Notary Seal” is 3 hereby STRICKEN. 4 II. FACTS 5 In July 2005, Plaintiff purchased real property and financed the purchase through Fremont 6 with first and second deeds of trust, and accompanying notes securing the loan. Fremont sold 7 Plaintiff’s loans on the secondary market to Deutsche Bank in August 2005 and service released 8 those loans to Ocwen Federal Bank in December 2005. The original nominated beneficiary was 9 MERS. MERS assigned beneficiary was HSBC for which MERS remained as nominee. Defendant 10 Aztec was the authorized and substituted foreclosure trustee. Plaintiff defaulted on his loan and a 11 trustee’s sale was noticed and completed pursuant to the provisions of Plaintiff’s Deed of Trust. 12 13 Plaintiff filed his Complaint in Clark County and Defendants properly removed it to federal court in March 2009. The Complaint brings two causes of action: quiet title and fraud. (#1). 14 III. DISCUSSION 15 A. 16 Under Rule 12(b)(6) of the Federal Rules of Civil Procedure, dismissal is appropriate if the 17 plaintiff “fail[s] to state a claim upon which relief can be granted.” Dismissal for failure to state a 18 claim under Rule 12(b)(6) is proper only if it is beyond doubt that the plaintiff can prove no set of 19 facts in support of the claim that would entitle the plaintiff to relief. Williamson v. Gen. Dynamics 20 Corp., 208 F.3d 1144, 1149 (9th Cir. 2000). The review is limited to the complaint, and all 21 allegations of material fact are taken as true and viewed in the light most favorable to the plaintiff. 22 In re Stac Elecs. Sec. Litig., 89 F.3d 1399, 1403 (9th Cir. 1996). Although courts assume the factual 23 allegations to be true, courts should not “assume the truth of legal conclusions merely because they 24 are cast in the form of factual allegations.” W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 25 1981). Motions to Dismiss Page 2 of 6 1 On a motion to dismiss, the court “presumes that general allegations embrace those specific 2 facts that are necessary to support the claim.” Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871, 889 3 (1990). However, conclusory allegations and unwarranted inferences are insufficient to defeat a 4 motion to dismiss under Rule 12(b)(6). In re Stac Elecs., 89 F.3d at 1403. 5 Plaintiff fails to bring a claim upon which relief can be granted for either of his causes of 6 action, to quiet title or for fraud by Defendants. No claim for wrongful foreclosure can be made, and 7 the fraud claim fails as it lacks the required specificity. 8 1. Quiet Title 9 Plaintiff alleges that Defendants had no interest in the property and that they should be 10 enjoined from asserting any estate, right, title or interest in the property adverse to him. (#1 at 3). 11 A quiet title claim requires a plaintiff to allege that the defendant is unlawfully asserting an adverse 12 claim to title to real property. Union Mill v. Mining Co. v. Warren, 82 F. 519, 520 (D. Nev. 1897) 13 ; Clay v. Cheeline Banking & Trust Co., 40 Nev. 9, 159 (1916). Defendant Fremont no longer claims 14 any interest in the property as it is not the owner of the Note or Deed of Trust and does not claim any 15 interest in the subject property. Defendant HSBC properly completed the foreclosure sale and it is 16 the only defendant which claims interest in it. Plaintiff provides no explanation as to what interests 17 Defendants acquired that were unlawful. In his request to quiet title, Plaintiff states no claim upon 18 which relief can be granted. 19 2. Fraud 20 Plaintiff alleges that Defendants intentionally misrepresented the nature of the loans and that 21 the loan was sub-prime in nature and not to Plaintiff’s benefit, along with other misrepresentations. 22 (#1). He also alleges that Defendants failed to provide the original note. He alleges that an 23 unidentified defendant endorsed the Note, opened a deposit on demand account in his name, forged 24 his signature, and deposited the Note as an asset. Other unidentified defendants then used the 25 endorsed note as an asset to fund the alleged loan. Id. at 4. He alleges that there was no lawful Page 3 of 6 1 money loaned in the first place and that the alleged Note had been discharged or paid in full, and that 2 he fears he was duped into a money-laundering scheme. Id. 3 Rule 9(b) of the Federal Rules of Civil Procedure requires that “[i]n alleging fraud or 4 mistake, a party must state with particularity the circumstances constituting fraud or mistake.” A 5 pleading is sufficient under Rule 9(b) if it identifies the circumstances constituting fraud so that the 6 defendant can prepare an adequate answer from the allegations. See Neubronner v. Milken, 6 F.3d 7 666, 671 (9th Cir. 1993). In addition, allegations of fraud must be accompanied by “the who, what, 8 when, where, and how of the misconduct charged.” Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 9 1106 (9th Cir. 2003). The Rule’s heightened pleading requirements have been held to apply to both 10 intentional and negligent misrepresentation claims. See Deitz v. Comcast Corp., No. 06-6352, 2006 11 WL 3782902, at *6 (N.D. Cal. Dec. 21, 2006) (collecting cases). 12 Again, Plaintiff fails to provide any particulars to the time, place, manner, identity, or content 13 of the misrepresentations. Without such factual allegations, he does not meet Rule 9(b)’s heightened 14 pleading standard and his cause of action for fraud necessarily fails. His money-laundering 15 arguments fails as the loans made to Plaintiff constitute the lending of money and creation of debt. 16 See Kolb v. Naylor, 658 F. Supp. 520 (N.D. Iowa 1987). 17 Defendants are not required to produce the original loan documents. Courts across the 18 country have rejected claims by plaintiffs asserting a duty by the lender to provide the original note 19 under the U.C.C. to prove its holder in due course status. See, e.g., U.S. Bank N.A. v. Phillips, 852 20 N.E.2d 380 (Ill.App.Ct. June 26, 2006); The Frances Kenny Trust v. World Savings Bank FSB, 2005 21 WL 106792 (Order, N.D. Cal. Jan. 19, 2005); Alcorn v. Washington Mutual Bank, F.A., 111 S.W.3d 22 264 (Tex.App. July 3, 2003). Plaintiff’s argument that Defendants’ failure to produce the original 23 Note demonstrates they have no legal interest in the property fails. 24 Plaintiff’s fleeting allusion to a violation of TILA fails as a claim as well. Not only is it time- 25 barred, but Plaintiff provides no factual allegations as to the claim. Additionally, the foreclosure was Page 4 of 6 1 performed properly. Plaintiff’s allegation of fraud on the part of Defendants fails to state a claim 2 upon which relief can be granted dismissal is appropriate. 3 B. 4 Federal Rule of Civil Procedure 12(f) states that the court “may strike from a pleading an Motion to Strike 5 Insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” “Redundant 6 matter is that which consists of allegations that constitute a needless repetition of other averments.” 7 Moulton v. Eugene Burger Mgmt. Corp., 2009 U.S. Dist. LEXIS 8694 (D. Nev. Jan. 26, 2009) (citing 8 Germaine Music v. Universal Songs of Polygram, 275 F. Supp. 2d 1288, 1299 (D. Nev. 2003) 9 (internal quotations omitted). “Matter which is immaterial is that which has no essential or 10 important relationship to the claim for relief or the defenses being pleaded. Id. 11 Plaintiff requests punitive damages and Defendants move to strike the request (#8). Nevada 12 Revised Statute § 42.005 provides for punitive damages as a remedy only “in an action for the breach 13 of an obligation not arising from contract.” Vague or conclusory allegations are not sufficient, even 14 if a tort claim was stated. See Fed. R. Civ. P. 9; Rush v. Nev. Indus. Comm., 94 Nev. 403, 580 P.2d 15 952 (1978). Plaintiff has failed to allege his claims with sufficient particularity for an award of 16 punitive damages. 17 Defendant Fremont also brings a Motion to Strike Plaintiff’s Affidavit full of allegations and 18 statements regarding the matter. (#30). The Affidavit (#29) is not made attached to a motion or part 19 of any pleading pending before the Court. As Plaintiff is appearing pro se, it would seem he filed 20 the Affidavit in an effort to put forth his version of the facts on the record. However, that is not the 21 proper venue to use to put forth allegations and statements. Accordingly, striking Plaintiff’s 22 Affidavit is appropriate. 23 C. 24 Any civil action may be removed to federal district court so long as original jurisdiction 25 Standard for Motion to Remand would lie in the court to which the case is removed. 28 U.S.C. § 1441. Jurisdiction founded on 28 Page 5 of 6 1 U.S.C. § 1332 requires that the parties be in complete diversity and the amount in controversy 2 exceed $75,000. The removal statute is to be strictly construed against removal jurisdiction. Gaus 3 v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). 4 As diversity between the parties is complete, and the Court has proper subject matter 5 jurisdiction, and Plaintiff provides no argument to the contrary. Further, Plaintiff’s Motion is moot 6 as dismissal is appropriate. 7 IV. CONCLUSION 8 The Court has considered Defendant’s Motion and the pleadings on file on behalf of all 9 parties. IT IS HEREBY ORDERED that Defendant Fremont’s Motion to Dismiss (#7), Defendant 10 Ocwen et al.’s Motion to Dismiss and Strike (#8), and Defendant Fremont’s Motion to Strike (#30) 11 are GRANTED. 12 IT IS FURTHER ORDERED that Plaintiff’s Motion to Remand (#13) is DENIED as moot. 13 IT IS FURTHER ORDERED that Plaintiff’s “Certificate of Protest under Notary Seal” is 14 hereby STRICKEN. 15 DATED: October 26, 2009. 16 17 ROBERT C. JONES UNITED STATES DISTRICT JUDGE 18 (jc) 19 20 21 22 23 24 25 Page 6 of 6
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