Kim et al v. Kearney et al.,, No. 2:2009cv02008 - Document 86 (D. Nev. 2010)

Court Description: ORDER denying as moot 37 Motion to Strike; denying as moot 38 Motion to Strike; granting in part and denying in part 45 Motion for Summary Judgment; granting in part and denying in part 57 Motion to Dismiss; and denying 59 Motion to Strike . IT IS FURTHER ORDERED granting in part and denying in part 55 Motion to Amend Complaint. Plaintiffs have 30 days to file a second amended complaint. Signed by Judge Philip M. Pro on 8/29/2010. (Copies have been distributed pursuant to the NEF - MJZ)
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Kim et al v. Kearney et al., Doc. 86 1 2 3 UNITED STATES DISTRICT COURT 4 DISTRICT OF NEVADA 5 6 TAI-SI KIM and JIN-SUNG HONG, 7 Plaintiffs, 8 v. 9 ADAM B. KEARNEY, et al., 10 Defendants. 11 *** ) ) ) ) ) ) ) ) ) ) ) 2:09-CV-02008-PMP-PAL ORDER 12 Presently before the Court is Defendant Alverson, Taylor, Mortensen & Sanders’ 13 Motion to Strike Plaintiffs’ First Amended Complaint (Doc. #37), filed on March 15, 2010. 14 Plaintiffs filed an Opposition (Doc. #50) on April 1, 2010. Defendant filed a Reply (Doc. 15 #56) on April 12, 2010. 16 Also before the Court is Defendant First American Title Insurance Company’s 17 Motion to Strike First Amended Complaint (Doc. #38), filed on March 15, 2010. Plaintiffs 18 filed an Opposition (Doc. #51) on April 1, 2010. Defendant filed a Reply (Doc. #54) on 19 April 9, 2010. 20 Also before the Court is proposed defendant Valley Foreclosure Services’ Motion 21 for Summary Judgment (Doc. #45/#46), filed on March 29, 2010. Plaintiffs filed an 22 Opposition (Doc. #72) on May 11, 2010. Proposed defendant Valley Foreclosure Services 23 did not file a reply. 24 Also before the Court is Plaintiffs’ Motion for Leave to File First Amended 25 Complaint and to Add Parties (Doc. #55), filed on April 9, 2010. Defendant Alverson, 26 Taylor, Mortensen & Sanders filed an Opposition (Doc. #63) on April 26, 2010. Defendant Dockets.Justia.com 1 First American Title Insurance Company filed an Opposition (Doc. #64) on April 26, 2010. 2 Plaintiffs filed Replies (Doc. #70, #71) on May 6, 2010. 3 Also before the Court is proposed defendant Cumorah Credit Union’s Motion to 4 Dismiss (Doc. #57) and Motion to Strike Plaintiffs’ Claims for Punitive Damages (Doc. 5 #59), filed on April 12, 2010. Plaintiffs Filed an Opposition (Doc. #73) on May 14, 2010. 6 Proposed defendant Cumorah Credit Union filed a Reply (Doc. #74) on May 24, 2010. 7 I. BACKGROUND 8 9 The Court set forth the factual predicate for this action in another Order filed contemporaneously herewith, and the Court will not repeat the facts here except where 10 necessary. Generally, Plaintiffs’ claims arise out of a real estate transaction in which 11 Plaintiffs contend they were duped into paying for an investment property (“the Property”) 12 which Defendant Adam Kearney (“Kearney”) encumbered with a loan by proposed 13 defendant Cumorah Credit Union (“Cumorah”). Kearney was to have turned over the 14 Property to Plaintiffs free and clear of any liens, including the Cumorah lien, upon Plaintiffs 15 exercising an option to buy the Property. Kearney initially did not transfer the Property to 16 Plaintiffs despite taking Plaintiffs’ payment in cash, and did not pay off the Cumorah loan 17 even after he transferred the Property to Plaintiffs. Cumorah eventually foreclosed on the 18 Property, leaving Plaintiffs without the Property and without the cash they invested therein. 19 Plaintiffs filed suit in this Court on October 15, 2009, asserting claims against 20 Kearney and others involved in the transaction and its aftermath. Several Defendants 21 moved to dismiss the claims against them. Plaintiffs subsequently filed a First Amended 22 Complaint (Doc. #29) without leave of the Court, adding several new Defendants and 23 clarifying allegations against the original Defendants. Defendants Alverson, Taylor, 24 Mortensen & Sanders (“ATM&S”) and First American Title Insurance Company (“First 25 American”) filed motions to strike the First Amended Complaint. In the meantime, one of 26 the new proposed defendants, Valley Foreclosure Services (“VFS”), moved for summary 2 1 judgment on the First Amended Complaint’s claims against it. Plaintiffs thereafter filed a 2 motion for leave to amend the Complaint in response to the motions to strike. Following 3 Plaintiffs’ motion to amend, proposed new defendant Cumorah filed a motion to dismiss 4 and to strike aimed at the proposed First Amended Complaint. Given the procedural 5 posture, the Court will deny the motions to strike filed by Defendants ATM&S and First 6 American as moot, and will treat the motions by VFS and Cumorah as oppositions to 7 Plaintiffs’ motion to amend on the grounds of futility. 8 I. LEGAL STANDARD 9 Generally, a plaintiff may amend his or her complaint once “as a matter of 10 course” within twenty-one days after serving it, or twenty-one days after service of a 11 responsive pleading or motion. Fed. R. Civ. P. 15(a)(1). In all other cases, a party may 12 amend its pleading only by leave of court or by written consent of the adverse party. Fed. 13 R. Civ. P. 15(a)(2). “The court should freely give leave when justice so requires.” Id.; see 14 also Foman v. Davis, 371 U.S. 178, 182 (1962) (“Rule 15(a) declares that leave to amend 15 ‘shall be freely given when justice so requires’; this mandate is to be heeded.”). The Court 16 considers five factors in deciding whether to grant leave to amend: “(1) bad faith, (2) undue 17 delay, (3) prejudice to the opposing party, (4) futility of amendment, and (5) whether 18 plaintiff has previously amended his complaint.” Allen v. City of Beverly Hills, 911 F.2d 19 367, 373 (9th Cir. 1990) (citing Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 20 (9th Cir. 1989)). The futility analysis determines whether the proposed amendment would 21 survive a challenge of legal insufficiency under Federal Rule of Civil Procedure 12(b)(6). 22 Miller v. Rykoff-Sexton, Inc., 845 F.2d 209, 214 (9th Cir. 1988). 23 In considering a motion to dismiss, “all well-pleaded allegations of material fact 24 are taken as true and construed in a light most favorable to the non-moving party.” Wyler 25 Summit P’ship v. Turner Broad. Sys., Inc., 135 F.3d 658, 661 (9th Cir. 1998) (citation 26 omitted). However, the Court does not necessarily assume the truth of legal conclusions 3 1 merely because they are cast in the form of factual allegations in the plaintiff’s complaint. 2 See Clegg v. Cult Awareness Network, 18 F.3d 752, 754-55 (9th Cir. 1994). There is a 3 strong presumption against dismissing an action for failure to state a claim. Ileto v. Glock 4 Inc., 349 F.3d 1191, 1200 (9th Cir. 2003). A plaintiff must make sufficient factual 5 allegations to establish a plausible entitlement to relief. Bell Atl. Corp. v Twombly, 550 6 U.S. 544, 556 (2007). Such allegations must amount to “more than labels and conclusions, 7 [or] a formulaic recitation of the elements of a cause of action.” Id. at 555. However, a 8 complaint “need not identify the statutory or constitutional source of the claim raised in 9 order to survive a motion to dismiss.” Alvarez v. Hill, 518 F.3d 1152, 1157 (9th Cir. 2008). 10 A. Alverson, Taylor, Mortensen & Sanders 11 Defendant ATM&S opposes Plaintiffs’ motion to amend, arguing that Plaintiffs 12 knew the facts supporting their amendment when they filed the original Complaint. 13 Additionally, ATM&S contends that the new allegations demonstrate ATM&S did not 14 proximately cause Plaintiffs’ injuries because Plaintiffs hired counsel after ATM&S 15 provided services, and his alleged negligence is a superseding cause of Plaintiffs’ injuries. 16 Plaintiffs respond that they did not know some of the facts supporting 17 amendment until First American Title Insurance Company filed its motion to dismiss, 18 which caused Plaintiffs to investigate their claims further. Plaintiffs further contend that 19 they also in good faith addressed some of the concerns Defendants raised in prior motions 20 to dismiss. The Court will not deny leave to amend based on the argument that Plaintiffs 21 22 should have known about the facts supporting amendment previously. Plaintiffs have 23 indicated that Defendants’ motions to dismiss alerted Plaintiffs to facts which they 24 subsequently investigated to support the new claims against the new proposed Defendants. 25 Plaintiffs also explain that they made clarifying allegations in response to Defendants’ 26 motions. 4 1 As to whether Plaintiffs’ allegations regarding the negligence of Plaintiffs’ 2 subsequent attorney is a superseding cause relieving ATM&S of liability as a matter of law, 3 the Court will not deny amendment. Which Defendants proximately caused Plaintiffs’ 4 injuries is a question of fact not suitable to resolution at this stage of the proceedings. 5 Plaintiffs may plead their claims against ATM&S and the subsequently-retained counsel in 6 the alternative. Fed. R. Civ. P. 8(d). 7 B. First American Title Insurance Company 8 Defendant First American Title Insurance Company (“First American”) opposes 9 Plaintiffs’ motion to amend, arguing that Plaintiffs have not cured the deficiencies First 10 American identified in relation to Plaintiffs’ claims other than to add a factual allegation in 11 relation to the alleged misrepresentation made by First American employee, Defendant Gina 12 Thomas. First American argues that because some of the claims are futile and subject to a 13 motion to dismiss, the Court should not allow amendment until it first addresses First 14 American’s motion to dismiss the original Complaint. 15 Plaintiffs respond that they did not know some of the facts supporting 16 amendment until First American filed its motion to dismiss, which caused Plaintiffs to 17 investigate their claims further. Plaintiffs further contend that they also in good faith 18 addressed some of the concerns Defendants raised in prior motions to dismiss. 19 As just discussed, Plaintiffs have indicated that Defendants’ motions to dismiss 20 alerted Plaintiffs to facts which they subsequently investigated to support the new claims 21 against the new proposed Defendants. Plaintiffs also explain that they made clarifying 22 allegations in response to Defendants’ motions. However, Defendant First American is 23 correct that Plaintiffs have not cured the deficiencies associated with several causes of 24 action against Defendant First American. The Court will not deny Plaintiffs leave to file the 25 proposed first amended complaint as it stands. However, if Plaintiffs file the proposed first 26 amended complaint as it stands, the Court will deny amendment as to those claims which 5 1 the Court identified as deficient in the Order filed contemporaneously herewith, and will 2 grant dismissal of those claims with prejudice. If Plaintiffs still seek to preserve those 3 claims, Plaintiffs must file a second amended complaint within thirty (30) days of the date 4 of this Order which cures the deficiencies identified in the Court’s other Order. 5 C. VFS 6 Proposed defendant VFS moves for summary judgment, and thus opposes 7 amendment, on the four counts asserted against it: counts thirty-six (wrongful foreclosure), 8 thirty-seven (conversion), thirty-nine (slander of title), and forty (quiet title). VFS argues 9 that Plaintiffs’ wrongful foreclosure claim is untimely under the relevant statute, and in any 10 event, Cumorah was entitled to foreclose because Kearney defaulted on the loan. VFS 11 contends a conversion claim only applies to personal property, not real property. As to 12 slander of title, VFS argues Plaintiffs were aware of the Cumorah lien and Cumorah had a 13 valid deed trust on the Property, and thus there was no false utterance regarding the 14 Property. As to the quiet title claim, VFS argues that although the claim’s caption identifies 15 VFS as a defendant on this claim, VFS does not claim title to the Property, as the trustee’s 16 deed grants title only to Cumorah. 17 Plaintiffs respond that VFS was not entitled to exercise any powers under the 18 applicable statutory authority because Plaintiffs owned the Property free and clear of 19 Cumorah’s lien when they took the Property without notice of Cumorah’s lien in June 2006. 20 Plaintiffs contend that when an alleged trustee lacks authorization to conduct a sale, the 21 trustee is not entitled to a statute of limitations defense. As to conversion, Plaintiffs 22 respond that if VFS disposed of personal property, such as fixtures, VFS is liable for 23 conversion, and Plaintiffs need to depose VFS and Cumorah to make this determination. 24 As to slander of title Plaintiffs contend a genuine issue of fact remains as to whether 25 Plaintiffs were bone fide purchasers who took without notice of Cumorah’s pending lien. 26 As to the quiet title claim, Plaintiffs agree to dismiss this claim against VFS if VFS claims 6 1 no rights in the Property. Plaintiffs further argue that VFS’s motion is premature because 2 Plaintiffs need discovery to determine whether it was VFS or Cumorah which induced 3 Plaintiffs’ prior counsel to drop them as defendants from a prior complaint. 1. Wrongful Foreclosure 4 Under Nevada law, a plaintiff successfully pleads a wrongful foreclosure claim if 5 6 he alleges “that at the time the power of sale was exercised or the foreclosure occurred, no 7 breach of condition or failure of performance existed on the mortgagor’s or trustor’s part 8 which would have authorized the foreclosure or exercise of the power of sale.” Collins v. 9 Union Fed. Sav. & Loan Ass’n, 662 P.2d 610, 623 (Nev. 1983). Under the relevant 10 statutory authority, a court may declare a foreclosure sale void under certain conditions, but 11 any action to void the sale must be brought either within 90 days after the date of the sale 12 for persons with notice of the foreclosure, or within 120 days after the date on which the 13 person received actual notice of the sale if proper notice was not provided pursuant to the 14 statute. Nev. Rev. Stat. § 107.080(5), (6). Plaintiffs do not dispute that they had notice of the foreclosure sale and did not 15 16 bring their lawsuit against VFS within ninety days of the sale. Plaintiffs provide no 17 authority for the proposition that a trustee who lacks authorization to exercise a power of 18 sale is not entitled to a statute of limitations defense. The Court therefore will deny 19 Plaintiffs leave to amend to add a wrongful foreclosure claim against VFS. 2. Conversion 20 In Nevada, conversion is “a distinct act of dominion wrongfully exerted over 21 22 another’s personal property in denial of, or inconsistent with his title or rights therein or in 23 derogation, exclusion, or defiance of such title or rights.” Evans v. Dean Witter Reynolds, 24 Inc., 5 P.3d 1043, 1048 (Nev. 2000) (quotation omitted). Whether the defendant converted 25 the plaintiff’s property generally is a question of fact. Id. 26 /// 7 1 Plaintiffs do not dispute that conversion applies only to personal property, not 2 real property. However, Plaintiffs contend VFS may have converted Plaintiffs’ personal 3 property located on the real property when it was sold. Plaintiffs have not made any factual 4 allegations supporting this claim. Although Plaintiffs contend they need to depose VFS and 5 Cumorah to determine whether either entity converted Plaintiffs’ property, Plaintiffs should 6 be aware of facts regarding whether they had any personal property on their real property 7 when it was sold. The Court therefore will deny Plaintiffs leave to amend to add this claim 8 as it stands in the proposed first amended complaint, but will grant leave to amend to add 9 factual allegations in support of this claim. If Plaintiffs still seek to preserve this claim, 10 Plaintiffs must file a second amended complaint within thirty (30) days of the date of this 11 Order which cures the deficiencies identified in this Order. 12 13 3. Slander of Title In Nevada, to allege a slander of title claim, the plaintiff must allege that “the 14 words spoken were false, that they were maliciously spoken, and that the plaintiff sustained 15 some special pecuniary damages as a direct and natural result of their having been spoken.” 16 Summa Corp. v. Greenspun, 607 P.2d 569, 573 (Nev. 1980). Recording a false document 17 satisfies the first element, and “a deed of trust which should have been cancelled is such a 18 false document.” Id. Allegations that the defendant knew the statement was false or acted 19 in reckless disregard of its truth or falsity will satisfy the malice requirement. Rowland v. 20 Lepire, 662 P.2d 1332, 1335 (Nev. 1983). “The special pecuniary damage is that which 21 directly and immediately results from the impairment of the vendability of the land caused 22 by the publication of the disparaging matter.” Summa Corp., 607 P.2d at 573. 23 Plaintiffs allege the Cumorah’s deed of trust identified the wrong property, both 24 by the metes and bounds description and by parcel number, and Plaintiffs affirmatively 25 were told that the Cumorah lien had been satisfied. Plaintiffs thus assert they took the 26 Property as bona fide purchasers without notice. Plaintiffs also allege VFS and Cumorah 8 1 were aware of the potential for a mistake regarding the lien’s status with respect to the 2 Property, because Cumorah recorded a corrected version of its lien after Plaintiffs acquired 3 the Property, yet VFS and Cumorah forged ahead with the foreclosure, and Plaintiffs 4 suffered damages as a result. Plaintiffs adequately have alleged a slander of title claim, and 5 the Court will grant leave to amend to add this claim. 6 7 4. Quiet Title Plaintiffs have agreed not to assert this claim against VFS, as VFS has disclaimed 8 it asserts an interest in the Property. The Court therefore will deny leave to amend to add 9 this claim against VFS. 10 D. Cumorah 11 Proposed defendant Cumorah moves to dismiss, and thus opposes amendment, as 12 to counts thirty-six (wrongful foreclosure), thirty-seven (conversion), thirty-nine (slander of 13 title), and forty (quiet title). Cumorah argues Plaintiffs’ wrongful foreclosure claim is 14 untimely. Cumorah further argues that even if this claim were timely, Cumorah was 15 entitled to foreclose because Kearney did not perform his obligations on the loan. Cumorah 16 also argues Cumorah’s conduct was not the proximate cause of Plaintiffs’ injuries for its 17 wrongful foreclosure, slander of title, and quiet title claims. Cumorah further argues the 18 conversion claim fails because conversion applies only to personal property, not real 19 property. Finally, Cumorah argues Plaintiffs’ allegations do not support a request for 20 punitive damages as against Cumorah. 21 Plaintiffs respond that Plaintiffs are bona fide purchasers who have owned the 22 Property since they took it without notice of Cumorah’s continuing lien on the Property in 23 June 2006. Plaintiffs further contend that because Cumorah ignored warning signs that it 24 may have lost its foreclosure rights due to its failure to record its deed of trust with an 25 accurate description of the Property, Plaintiffs have alleged facts supporting punitive 26 damages. As to their claims for slander of title and quiet title, Plaintiffs argue that Cumorah 9 1 did not make any arguments as to why these two claims should be dismissed other than to 2 argue that because the wrongful foreclosure claim must be dismissed, so must these two 3 claims. Finally, as to conversion, Plaintiffs argue that if Cumorah disposed of any of 4 Plaintiffs’ personal property, such as fixtures, then Plaintiffs have a viable conversion 5 claim. Plaintiffs contend they need to depose VFS and Cumorah to make this 6 determination. 1. Wrongful Foreclosure 7 As discussed above, this claim is untimely. The Court therefore will deny leave 8 9 to amend to add this claim against Cumorah. 2. Conversion 10 As discussed above, Plaintiffs do not dispute that conversion applies only to 11 12 personal property, not real property. However, Plaintiffs contend Cumorah may have 13 converted Plaintiffs’ personal property located on the real property when it was sold. 14 Plaintiffs have not made any factual allegations supporting this claim. Although Plaintiffs 15 contend they need to depose VFS and Cumorah to determine whether either of these entities 16 converted Plaintiffs’ property, Plaintiffs should be aware of facts regarding whether they 17 had any personal property on their real property when it was sold. The Court therefore will 18 deny Plaintiffs leave to amend to add this claim as it stands in the proposed first amended 19 complaint, but will grant leave to amend to add factual allegations in support of this claim. 20 If Plaintiffs still seek to preserve this claim, Plaintiffs must file a second amended 21 complaint within thirty (30) days of the date of this Order which cures the deficiencies 22 identified in this Order. 3. Slander of Title 23 As set forth above, Plaintiffs have alleged a slander of title claim. The Court 24 25 therefore will grant Plaintiffs leave to amend to add this claim. 26 /// 10 1 4. Quiet Title 2 A plaintiff asserting a quiet title claim must allege that the defendant is 3 unlawfully asserting an adverse claim to title to real property. Union Mill v. Mining Co. v. 4 Warren, 82 F. 519, 520 (D. Nev. 1897); Clay v. Cheeline Banking & Trust Co., 159 P. 1081 5 (Nev. 1916). To prevail in a quiet title action, the plaintiff must establish “good title in 6 himself.” Breliant v. Preferred Equities Corp., 918 P.2d 314, 318 (Nev. 1996). 7 Under Nevada law, “[e]very conveyance of real property within this State . . . 8 which shall not be recorded as provided in this chapter, shall be void as against any 9 subsequent purchaser, in good faith and for a valuable consideration, of the same real 10 property, or any portion thereof, where his or her own conveyance shall be first duly 11 recorded.” Nev. Rev. Stat. § 111.325. A bona fide purchaser is under a duty of inquiry 12 when “the circumstances are such that a purchaser is in possession of facts which would 13 lead a reasonable man in his position to make an investigation that would advise him of the 14 existence of prior unrecorded rights.” Berge v. Fredericks, 591 P.2d 246, 249 (Nev. 1979). 15 Cumorah argues that because it was entitled to foreclose after Kearney failed to 16 pay off the loan, Plaintiffs have no wrongful foreclosure claim and thus no right to a quiet 17 title claim. However, Plaintiffs allege they are bona fide purchasers who were unaware of 18 the Cumorah loan. Although Cumorah argues Plaintiffs’ own allegations show they had 19 actual notice of the Cumorah lien, Plaintiffs contend they did not have notice that the 20 Cumorah loan had not been repaid, and in fact had been assured the loan was satisfied and 21 the lien no longer encumbered the Property. Cumorah contends Plaintiffs were aware or 22 should have been aware that the lien still encumbered the Property because they did not 23 receive a payoff statement at escrow. Whether Plaintiffs actually were on notice or should 24 have investigated further are questions not suitable for resolution at this stage of the 25 proceedings. Plaintiffs have alleged facts supporting a quiet title claim and the Court 26 11 1 therefore will grant Plaintiffs leave to amend to add this claim.1 5. Motion to Strike Punitive Damages 2 Cumorah moves to strike Plaintiffs’ request for punitive damages. Evidence that 3 4 a defendant ignored warning signs of a potential mistake regarding its ability to foreclose 5 and proceeded with the foreclosure in the face of those warning signs may suffice to 6 support punitive damages. Countrywide Home Loans, Inc. v. Thitchener, 192 P.3d 243, 7 255 (Nev. 2008). Here, Plaintiffs allege Cumorah had warning signs that it did not have 8 authority to foreclose on the Property due to errors in the recorded deed of trust, yet it 9 proceeded with the foreclosure anyway. Given these allegations, the Court will not strike 10 the request for punitive damages at this stage of the proceedings. 11 V. CONCLUSION IT IS THEREFORE ORDERED that Defendant Alverson, Taylor, Mortensen & 12 13 Sanders’ Motion to Strike Plaintiffs’ First Amended Complaint (Doc. #37) is hereby 14 DENIED as moot. IT IS FURTHER ORDERED that Defendant First American Title Insurance 15 16 Company’s Motion to Strike First Amended Complaint (Doc. #38) is hereby DENIED as 17 moot. IT IS FURTHER ORDERED that proposed defendant Valley Foreclosure 18 19 Services’ Motion for Summary Judgment (Doc. #45/#46) is hereby GRANTED in part and 20 DENIED in part. The motion is granted in that the Court will (1) deny Plaintiffs leave to 21 amend to add a wrongful foreclosure claim against Valley Foreclosure Services, (2) deny 22 Plaintiffs leave to amend to add a quiet title claim against Valley Foreclosure Services, and 23 (3) deny Plaintiffs leave to amend to add the conversion claim as it presently is stated. The 24 1 25 26 Defendant Cumorah argues for the first time in reply that because the wrongful foreclosure claim is untimely, so are Plaintiffs’ other claims related to the foreclosure. The Court declines to consider this argument raised for the first time in the reply brief, as Plaintiffs have not had an opportunity to respond. Carstarphen v. Milsner, 594 F. Supp. 2d 1201, 1204 n.1 (D. Nev. 2009). 12 1 motion is denied in that the Court will (1) grant Plaintiffs leave to amend to add the slander 2 of title claim as stated in the proposed first amended complaint, and (2) grant Plaintiffs 3 leave to file a second amended complaint adding factual allegations to support a conversion 4 claim. 5 IT IS FURTHER ORDERED that proposed defendant Cumorah Credit Union’s 6 Motion to Dismiss (Doc. #57) is hereby GRANTED in part and DENIED in part. The 7 motion is granted in that the Court will (1) deny Plaintiffs leave to amend to add a wrongful 8 foreclosure claim against Cumorah Credit Union, and (2) deny Plaintiffs leave to amend to 9 add the conversion claim as it presently is stated. The motion is denied in that the Court 10 will (1) grant Plaintiffs leave to amend to add the slander of title and quiet title claims as 11 stated in the proposed first amended complaint, and (2) grant Plaintiffs leave to file a 12 second amended complaint adding factual allegations to support a conversion claim. 13 14 15 IT IS FURTHER ORDERED that proposed defendant Cumorah Credit Union’s Motion to Strike Plaintiffs’ Claims for Punitive Damages (Doc. #59) is hereby DENIED. IT IS FURTHER ORDERED that Plaintiffs’ Motion for Leave to File First 16 Amended Complaint and to Add Parties (Doc. #55) is hereby GRANTED in part and 17 DENIED part. Plaintiffs may elect to stand on the proposed first amended complaint. 18 Alternatively, Plaintiffs may file a second amended complaint within thirty (30) days of the 19 date of this Order correcting the deficiencies identified in this Order and the Order filed 20 contemporaneously herewith. 21 22 23 24 DATED: August 29, 2010 _______________________________ PHILIP M. PRO United States District Judge 25 26 13