Carlson v. Wells Fargo Bank, N.A. et al, No. 2:2015cv00109 - Document 18 (W.D. Wash. 2015)

Court Description: ORDER granting 7 Defendants Wells Fargo and Freddie Mac's Motion to Dismiss with prejudice and denying 13 Plaintiff's Motion to Amend. Federal Home Loan Mortgage Corporation and Wells Fargo Bank, N.A. terminated, by Judge James L. Robart.(MD)

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Carlson v. Wells Fargo Bank, N.A. et al Doc. 18 1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 8 9 10 LUTHER N. CARLSON, Plaintiff, 11 v. 12 13 WELLS FARGO BANK, N.A., et al., Defendants. 14 15 16 CASE NO. C15-0109JLR I. ORDER GRANTING DEFENDANTS WELLS FARGO AND FREDDIE MAC’S MOTION TO DISMISS AND DENYING PLAINTIFF’S MOTION TO AMEND INTRODUCTION Before the court are two motions: (1) a motion by Defendants Wells Fargo Bank, 17 N.A. (“Wells Fargo”) and Federal Home Loan Mortgage Corporation (“Freddie Mac”) to 18 dismiss Plaintiff Luther N. Carlson’s claims against them (Defs.’ Mot. (Dkt. # 7)), and 19 (2) a motion by Mr. Carlson for leave to file a second amended complaint (“SAC”) (Pl.’s 20 Mot. (Dkt. # 13)). The court has considered both motions, the parties’ submissions filed 21 in support of and opposition thereto, the balance of the record, and the applicable law. 22 Being fully advised, the court GRANTS Defendants’ motion and DENIES Mr. Carlson’s ORDER- 1 Dockets.Justia.com 1 motion. Accordingly, the court DISMISSES all of Mr. Carlson’s claims against 2 Defendants Wells Fargo and Freddie Mac WITH PREJUDICE. 3 4 II. BACKGROUND The facts underpinning this action appear to have arisen when Mr. Carlson signed 5 a promissory note on January 29, 2010, for a loan from Wells Fargo in the amount of 6 $369,653.00. 1 (See Request for Judicial Notice (“RFJN”) (Dkt # 8) Ex. 1 (“Note”).) The 7 loan was secured by a deed of trust on property located at 31036 NE 116th Street, 8 Carnation, Washington, 98014. (See RFJN Ex. 2 (“Deed of Trust”).) The Deed of Trust 9 listed Luther N. Carlson and Kari L. Carlson as borrowers, Wells Fargo as the lender, and 10 Northwest Trustee Services, LLC (“NWTS”) as the trustee. (See id. at 3-4.) By October 11 2011, the Carlsons had defaulted on the loan, and NWTS issued a notice of trustee’s sale 12 to be held on February 3, 2012. (See RFJN Ex. 3 (“2011 Notice”).) Mr. Carlson filed a 13 complaint and temporary restraining order against Wells Fargo and NWTS in King 14 County Superior Court for the State of Washington on February 1, 2012 (“2012 Case”). 15 Carlson v. Wells Fargo Bank N.A., No. 12-2-04140-7SEA (King Cnty. Super. Ct. Feb. 1, 16 2012). (See RFJN Ex. 4.) 17 18 19 1 The court notes that it is somewhat difficult to determine what, precisely, Mr. Carlson alleges, as his complaint appears to have been lifted virtually word-for-word from the complaint 20 in an entirely unrelated action filed in the Central District of California in 2013. See Jensen v. 21 Quality Loan Serv. Corp., 702 F. Supp. 2d 1183 (C.D. Cal. 2013). Nevertheless, the court construes Mr. Carlson’s pro se complaint liberally as it is required to do. See Erickson v. Pardus, 551 U.S. 89, 94 (2007). 22 ORDER- 2 1 In the 2012 Case, Mr. Carlson asked the state court to halt the trustee’s sale. 2 (RFJN Ex. 4.) He made a series of allegations including the following: (1) NWTS failed 3 to fulfill its obligations of good faith (see RFJN Ex. 4, at 4-5); (2) Wells Fargo was not 4 the proper beneficiary of the trust because it did not hold the promissory note (id. at 4-7); 5 (3) both Wells Fargo and NWTS committed “intentional and express violations of RCW 6 61.24.040, which will result[] in the Property being wrongfully foreclosed on [sic] based 7 on an improper foreclosure procedure which has been initiated” (id. at 8); and (4) both 8 NWTS and Wells Fargo committed “multiple violations of 15 U.S.C. [§] 6101; 9 Consumer Protection Act; Truth in Lending Act; Fraud; and Fiduciary Duty” (id.). The 10 state court dismissed all of the Carlsons’ claims against NWTS with prejudice on July 6, 11 2012, under Washington Rule of Civil Procedure 12(b)(6). (See RFJN Ex. 5.) On 12 October 12, 2012, the state court likewise dismissed all claims against Wells Fargo with 13 prejudice. (See RFJN Ex. 6.) 14 After the dismissal of the 2012 Case, NWTS issued a second Notice of Trustee’s 15 Sale (“2013 Notice”) which was recorded by the county auditor on October 8, 2013. (See 16 RFJN Ex. 7.) The Notice stated that the Carlsons were $92,136.79 in arrears on the loan, 17 and announced that NWTS would sell the property at 10:00 a.m. on February 14, 2014. 18 (See id. at 3.) The first page of the Notice urged the Carlsons (in boldface, all-capital 19 letters) to “contact a housing counselor or an attorney licensed in Washington now” to get 20 help, and provided information about how to seek assistance. (Id. at 2-3.) The notice 21 also contained the following statement: 22 ORDER- 3 1 Anyone having any objection to the sale on any grounds whatsoever will be afforded an opportunity to be heard as to those objections if they bring a lawsuit to restrain the sale pursuant to RCW 61.24.130. Failure to bring a lawsuit may result in a waiver of any proper grounds for invalidating the Trustee’s sale. 2 3 4 (Id. at 5.) 5 Mr. Carlson did not bring an action to halt the February 14, 2014, sale of the 6 property, and Wells Fargo purchased the property at the sale with a high bid of 7 $343,547.00. (RFJN Ex. 8, at 3.) At Wells Fargo’s instruction, NWTS then issued a 8 trustee’s deed to Freddie Mac on February 14, 2014. (Id.) 9 The Carlsons refused to vacate the property after the trustee’s sale, and on April 10 22, 2014, Freddie Mac filed a complaint for unlawful detainer in King County Superior 11 Court. Fed. Home Loan Mortg. Corp. v. Carlson, No. 14-2-11372-2KNT (King Cnty. 12 Super. Ct. Apr. 22, 2014) (“Eviction Case”). (See Second Request for Judicial Notice 13 (“2d RFJN”) (Dkt. # 16) Ex. 3.) On June 4, 2014, the King County Superior Court issued 14 a writ of restitution in the Eviction Case and ordered the sheriff to put Freddie Mac in 15 possession of the property. (See 2d RFJN Ex. 5 at 3-4.) Mr. and Ms. Carlson appealed 16 the decision. (See 2d RFJN Ex. 6.) 17 While the Eviction Case was still pending, Mr. and Ms. Carlson filed this action in 18 King County Superior Court against Freddie Mac on May 30, 2014. (See Verification of 19 State Court Records (Dkt. # 6) Ex. 1 at 6-52.) The Original Complaint listed both Luther 20 N. Carlson and Kari L. Carlson as plaintiffs, and included only Freddie Mac and “Does 121 50” as defendants. (Id. at 6.) Mr. Carlson then filed a First Amended Complaint 22 (“FAC”) on June 16, 2014, dropping Kari L. Carlson as plaintiff and adding Wells Fargo, ORDER- 4 1 “The Mortgage Fighter,” Darren Brown, and Pete Wagner, as co-defendants with Freddie 2 Mac. (See Notice of Removal (Dkt. # 1) Ex. A at 2.) 3 The FAC alleges ten causes of action: (1) declaratory relief, which is pled twice 4 (FAC at ¶¶ 17-22, 120-25); (2) fraud, which is pled twice (id. at ¶¶ 23-147, 126-50); (3) 5 “Tortious Violation of Statute” (id. at ¶¶ 151-58); (4) “reformation” (id. at ¶¶ 159-70); (5) 6 “quiet title and set aside foreclosure” (id. at ¶¶ 171-75); (6) “Violation of Business and 7 Professions Code Section 17200” (id. at ¶¶ 1576-81); (7) “Violation of Washington Civil 8 Code 2923.6” (id. at ¶¶ 182-94); (8) “Violation Of § 1788.17 Of The RFDCPA” (id. at 9 ¶¶ 195-200); (9) “Violation of Civil Code TITLE 61” (id. at ¶¶ 201-12); and (10) 10 injunctive relief (id. at ¶¶ 213-17). 2 11 Freddie Mac removed the action to this court based under 28 U.S.C. § 1442 and 12 12 U.S.C. § 1452(f). Freddie Mac and Wells Fargo have moved to dismiss Mr. Carlson’s 13 complaint, arguing that all of his claims against them are barred by res judicata (claim 14 preclusion), and that some are also barred by waiver, expired statutes of limitation, failure 15 to state a claim, and the Merrill doctrine. 3 (See generally Defs.’ Mot. (Dkt. # 7).) Mr. 16 Carlson has filed a response in opposition to Wells Fargo and Freddie Mac’s motion 17 18 2 The Court notes that the bulk of Mr. Carlson’s first amended complaint appears to have been copied directly from the complaint filed in an unrelated case out of the Eastern District of 19 California. See Jenson v. Quality Loan Service Corp., 702 F. Supp. 2d 1183 (E.D. Cal. 2010). 3 Under the Merrill doctrine, which derives its name from the United States Supreme Court case Federal Crop Insurance Corp. v. Merrill, 332 U.S. 380 (1947), a government 21 agency—like Freddie Mac—is not bound by, or liable for, the unauthorized or illegal conduct of its agents. See Johnson v. Federal Home Loan Mortg. Corp., No. C12-1712TSZ, 2013 WL 308957, at *5-7 (W.D. Wash. Jan. 25, 2013) (holding that Freddie Mac was not liable for alleged 22 breaches of contract and fiduciary duty by mortgage servicers). 20 ORDER- 5 1 (Pl.’s Resp. (Dkt. # 12)), and has also requested leave to file a Second Amended 2 Complaint (Pl.’s Mot. (Dkt. # 13)). The court will address both motions together. 3 III. ANALYSIS 4 A. Standards 5 Wells Fargo and Freddie Mac ask this court to dismiss Mr. Carlson’s complaint 6 under Federal Rule of Civil Procedure 12(b)(6) because res judicata precludes all of his 7 claims against them. 4 “To survive a motion to dismiss, a complaint must contain 8 sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its 9 face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 10 550 U.S. 544, 570 (2007)); see also Telesaurus VPC, LLC v. Power, 623 F.3d 998, 1003 11 (9th Cir. 2010). “A claim has facial plausibility when the plaintiff pleads factual content 12 that allows the court to draw the reasonable inference that the defendant is liable for the 13 misconduct alleged.” Iqbal, 556 U.S. at 663. 14 Dismissal under Rule 12(b)(6) can be based on the lack of a cognizable legal 15 theory or the absence of sufficient facts alleged under a cognizable legal theory. 16 Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990). Further, dismissal 17 is proper when an insuperable legal obstacle bars plaintiff’s claims. See Jones v. Block, 18 549 U.S. 199, 215 (2007) (“If the allegations . . . show that relief is barred by the 19 20 4 Wells Fargo and Freddie Mac also argue that expired statutes of limitation, Washington’s waiver doctrine, and the Merrill doctrine bar Mr. Carlson’s claims. Because the court concludes that res judicata precludes all claims against these two defendants, the court 22 declines to address the alternative arguments. 21 ORDER- 6 1 applicable statute of limitations, the complaint is subject to dismissal for failure to state a 2 claim.”); Morales v. City of L.A., 214 F.3d 1151, 1153 (9th Cir. 2000). 3 The Ninth Circuit has summarized the governing standard as follows: “In sum, for 4 a complaint to survive a motion to dismiss, the non-conclusory factual content, and 5 reasonable inferences from that content, must be plausibly suggestive of a claim entitling 6 the plaintiff to relief.” Moss v. U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009) 7 (internal quotation marks omitted). The court concludes that the doctrine of res judicata 8 bars Mr. Carlson’s claims against Wells Fargo and Freddie Mac, and accordingly grants 9 defendants’ motion to dismiss. (Defs.’ Mot.) 10 B. Request for Judicial Notice 11 Defendants Wells Fargo and Freddie Mac ask the court to take judicial notice 12 several documents that are pertinent to the decision in this case, such as the Note, the 13 Deeds of Trust, the Notices, and the state-court filings and orders in the 2012 Case and 14 the 2014 Eviction Case. (See generally RFJN; 2d RFJN.) “Generally, on a 12(b)(6) 15 motion, the District Court should consider only the pleadings.” Shaver v. Operating 16 Engineers Local 428 Pension Trust Fund, 332 F.3d 1198, 1201 (9th Cir. 2003). The 17 court, however, “may also consider documents whose contents are alleged in a complaint 18 and whose authenticity no party questions, but which are not physically attached to the 19 [plaintiff’s] pleading.” Northstar Fin. Advisors Inc. v. Schwab Investments, 779 F.3d 20 1036, 1043 (9th Cir. 2015) (alteration in original) (quoting Knievel v. ESPN, 393 F.3d 21 1068, 1076 (9th Cir. 2005)). Courts sometimes refer to this as the doctrine of 22 “incorporation by reference.” Id. ORDER- 7 1 Additionally, when considering a motion to dismiss, a court may take judicial 2 notice of “matters of public record.” Mack v. S. Bay Beer Distrib., 798 F.2d 1279, 1282 3 (9th Cir. 1986). Federal Rule of Evidence 201 permits the court to “judicially notice a 4 fact that is not subject to reasonable dispute because it: (1) is generally known within the 5 court’s territorial jurisdiction; or (2) can be accurately and readily determined from 6 sources whose accuracy cannot reasonably be questioned.” Fed. R. Evid. 201. 7 Consistent with that rule, the court may take judicial notice of undisputed matters of 8 public record, such as documents on file in federal or state courts. See Harris v. Cnty. of 9 Orange, 682 F.3d 1126, 1131-32 (9th Cir. 2012) (taking judicial notice of state court 10 proceedings in res judicata analysis); Lee v. Thornburg Mortg. Home Loans Inc., No. 1411 cv-00602 NC, 2014 WL 4953966 (N.D. Cal. Sept. 29, 2014) (taking judicial notice of 12 court filings and public records in evaluating whether res judicata barred pro se 13 plaintiff’s third attempt to litigate home foreclosure). 14 No party has challenged the authenticity of the Note, Deeds of Trust, and Notices, 15 court filings, and other documents submitted by Defendants Wells Fargo and Freddie 16 Mac in their two requests for judicial notice. Each of these documents has either been 17 referred to in the complaint, or is a matter of public record. See Northstar, 779 F.3d at 18 1043; Fed. R. Evid. 201. Having so found, the court takes judicial notice of the 19 documents. 20 C. Res Judicata 21 Wells Fargo and Freddie Mac assert that the doctrine of res judicata bars all of 22 Mr. Carlson’s claims because those claims either were, or could have been, brought in the ORDER- 8 1 2012 Case in King County Superior Court. (See Defs.’ Mot. at 7-10.) Federal Courts 2 “determine the preclusive effect of a state court judgment by applying that state’s 3 preclusion principles.” ReadyLink Healthcare, Inc. v. State Comp. Ins. Fund, 754 F.3d 4 754, 760 (9th Cir. 2014) (citing 28 U.S.C. § 1738); see also Migra v. Warren City Sch. 5 Dist. Bd. of Educ., 465 U.S. 75, 81 (1984) (“It is now settled that a federal court must 6 give to a state-court judgment the same preclusive effect as would be given that judgment 7 under the law of the State in which the judgment was rendered.”); Ounyoung v. Fed. 8 Home Loan Mortgage Corp., No. Civ. 12-00322 LEK, 2012 WL 5880673, at *4 (D. 9 Haw. Nov. 21, 2012) (applying Hawaii law to evaluate preclusion of claims against 10 Freddie Mac in the context of nonjudicial foreclosure). Because a Washington court 11 decided the 2012 Case, Washington’s res judicata law governs. 12 Under Washington law, the threshold requirement for invoking the res judicata 13 doctrine is a final judgment on the merits. Karlberg v. Otten, 280 P.3d 1123, 1130 14 (Wash. Ct. App. 2012). In addition, the Supreme Court of Washington has explained that 15 16 res judicata occurs when a prior judgment has a concurrence of identity in four respects with a subsequent action. There must be identity of (1) subject matter; (2) cause of action; (3) persons and parties; and (4) the quality of the persons for or against whom the claim is made. 17 Schroeder v. Excelsior Mgmt. Grp., LLC, 297 P.3d 677, 684 (Wash. 2013) (quoting 18 Mellor v. Chamberlin, 673 P.2d 610 (Wash. 1983)) (quotation marks omitted). 19 Washington law, moreover, prohibits claim splitting, which occurs when a party files 20 separate lawsuits with different claims, but based on the same events. Ensley v. Pitcher, 21 222 P.3d 99, 102 (Wash. Ct. App. 2009). In essence, under Washington law, “[r]es 22 ORDER- 9 1 judicata—or claim preclusion—applies where a final judgment previously entered and a 2 present action are so similar that the current claim should have been litigated in the 3 former action.” Storti v. Univ. of Washington, 330 P.3d 159, 165 (Wash. 2014). “Res 4 judicata is the rule, not the exception.” Hisle v. Todd Pac. Shipyards Corp., 93 P.3d 108, 5 114 (Wash. 2004). 6 Applying this standard, the court determines that res judicata precludes Mr. 7 Carlson’s claims against Wells Fargo and Freddie Mac. In reaching this conclusion, the 8 court considers the current action and the 2012 Case. The court may consider the 2012 9 Case in the context of a motion to dismiss because that suit is a matter of public record. 10 See Fed. R. Evid. 201(b); Harris, 682 F.3d at 1131-32. The court also notes that the 2012 11 Case was dismissed with prejudice. (RFJN Ex. 6.) A dismissal with prejudice 12 constitutes a final judgment on the merits. See Headwaters Inc. v. U.S. Forest Serv., 399 13 F.3d 1047, 1052 (9th Cir. 2005); Krikava v. Webber, 716 P.2d 916, 918 (Wash. Ct. App. 14 1986). The threshold requirement for application of res judicata under Washington law 15 is, therefore, satisfied here. See Karlberg, 280 P.3d at 1130. 16 There is no real doubt that both cases involve the same subject matter, persons and 17 parties, and quality of person or parties. First, the parties in both suits are either the same 18 or they are in privity. Wells Fargo was a defendant in the 2012 Case (see RFJN Ex. 4), 19 and Freddie Mac acquired the trustee’s deed from Wells Fargo after the trustee’s sale 20 carried out by NWTS, which was a defendant in the 2012 Case (see RFJN Ex. 8). 21 Pederson v. Potter, 11 P.3d 833, 838 (Wash. Ct. App. 2000); Rains v. State, 674 P.2d 22 165, 169 (Wash. Ct. App. 1983). The quality of the persons and parties is, consequently, ORDER- 10 1 the same because each party has “acted in its own capacity against [the other] and sought 2 to advance and protect its own interests in both lawsuits.” Berschauer Phillips Const. 3 Co. v. Mut. of Enumclaw Ins. Co., 308 P.3d 681, 685 (Wash. Ct. App. 2013). 4 Additionally, both actions involve the same subject matter, namely the same real 5 property, promissory note, original deed of trust, payments from Mr. Carlson to Wells 6 Fargo, and nonjudicial foreclosure. See Pederson, 11 P.3d at 838. 7 This case also arises from the same cause of action as the 2012 Case. In analyzing 8 the same-cause-of-action element for purpose of applying the doctrine of res judicata, 9 Washington courts look to the following four factors: 10 11 12 (1) [W]hether rights or interests established in the prior judgment would be destroyed or impaired by prosecution of the second action; (2) whether substantially the same evidence is presented in the two actions; (3) whether the two suits involve infringement of the same right; and (4) whether the two suits arise out of the same transactional nucleus of facts. 13 Rains v. State, 674 P.2d 165, 168 (Wash. 1983) (en banc) (alteration in original) (quoting 14 Costantini v. Trans World Airlines, 681 F.2d 1199, 1201-02 (9th Cir. 1982)). “These 15 four factors are analytical tools; it is not necessary that all four factors be present to bar 16 the claim.” Ensley v. Pitcher, 222 P.3d 99, 105 (Wash. Ct. App. 2009). The fourth factor 17 is the most important. Deja Vu-Everett-Federal Way, Inc. v. City Of Federal Way, 979 18 P.2d 464, 468 (Wash. Ct. App. 1999) (citing Constantini, 681 F.2d at 1202; cf. Kathleen 19 M. McGinnis, Revisiting Claim and Issue Preclusion in Washington, 90 Wash. L. Rev. 20 75, 109-11 (suggesting that “[t]he transactional nucleus test could easily be the sole test 21 for identity of claims because it is broad and flexible enough to include the essence of the 22 inquiries advanced by the other tests”). ORDER- 11 1 In the 2012 Case, Mr. Carlson challenged NWTS’s right to proceed with the 2 nonjudicial foreclosure of the Carnation, Washington property. He alleged failure to 3 fulfill obligations of good faith (see RFJN Ex. 4, at 4-5), technical deficiencies with the 4 nonjudicial foreclosure process (id. at 4-7), violations of the Washington Deed of Trust 5 Act, RCW 61.24.040 (id. at 8), as well as “multiple violations of 15 U.S.C. [§] 6101; 6 Consumer Protection Act; Truth in Lending Act; Fraud; and Fiduciary Duty” (id.). 7 In this action he alleges claims for declaratory relief (FAC at ¶¶ 17-22, 120-25), 8 fraud (id. at ¶¶ 23-147, 126-50), “Tortious Violation of Statute” (id. at ¶¶ 151-58), 9 “reformation” (id. at ¶¶ 159-70), “quiet title and set aside foreclosure” (id. at ¶¶ 171-75), 10 “Violation of Business and Professions Code Section 17200” (id. at ¶¶ 1576-81), 11 “Violation of Washington Civil Code 2923.6” (id. at ¶¶ 182-94), “Violation Of § 1788.17 12 [o]f The RFDCPA” (id. at ¶¶ 195-200), “Violation of Civil Code Title 61” (id. at ¶¶ 20113 12), and injunctive relief (id. at ¶¶ 213-17). All of these claims stem from the loan, deed 14 of trust, and nonjudicial foreclosure on the Carnation, Washington property. 15 Applying the four factors from Washington law, the court concludes that the 16 claims Mr. Carlson now alleges against Wells Fargo and Freddie Mac constitute the same 17 causes of action presented in the 2012 Case. First, allowing this action to proceed would 18 destroy the rights and interests established in the prior judgment. After the dismissal of 19 the 2012 Case, Wells Fargo’s right to carry out the foreclosure, and proceed with the 20 trustee’s sale was vindicated. Indeed, a trustee’s sale did take place in February 2014, 21 and Freddie Mac acquired its trustee’s deed following that sale. Given these events, the 22 rights and interests Wells Fargo and Freddie Mac now possess in relation to the ORDER- 12 1 Carnation, Washington property are directly tied to the resolution of the 2012 Case. 2 Litigation of the claims Mr. Carlson alleges here would unquestionably destroy or impair 3 those rights. Rains v, 674 P.2d at 168. 4 Turning now to the second factor in Washington’s same-cause-of-action analysis, 5 the court concludes that both actions deal with substantially the same evidence, namely 6 the same property, loan, deed of trust, promissory note, and notices. Likewise, under the 7 third factor, both suits allege infringement of the same right. Mr. Carlson’s present 8 complaint centers on his belief that Wells Fargo lacked the authority to foreclose on his 9 home. The 2012 Case resolved that question. 10 The fourth, and most important, factor also militates in favor of claim preclusion, 11 as the transactional nucleus of facts is the same in both cases. Deja Vu-Everett-Federal 12 Way, Inc., 979 P.2d at 468. Both cases revolve around the identical series of transactions 13 stemming from a loan for $369,653.00, the deed of trust granted to NWTS to secure the 14 loan, Mr. Carlson’s failure to repay the loan, and—ultimately—Wells Fargo’s right to 15 foreclose to recover the loan. Accordingly, both cases share a common transactional 16 nucleus of facts. See Walker v. BAC Home Loans Serv., L.P., No. C14-1709JLR, 2015 17 WL 999920 (W.D. Wash. March 15, 2015) (finding common transactional nucleus of 18 facts when homeowner sued lender to prevent foreclosure after previous suit was 19 dismissed with prejudice). 20 In summary, all of Mr. Carlson’s claims against Wells Fargo and Freddie Mac are 21 precluded by res judicata. The 2012 Case ended in dismissal with prejudice, which 22 constitutes a final judgment on the merits for purposes of res judicata. Both cases are ORDER- 13 1 identical for purposes of the res judicata analysis under Washington law. The parties and 2 their quality are the same in both suits, and both suits involve the same subject matter. In 3 addition, the causes of action align on all four of the relevant factors, including the most 4 important factor, a shared transactional nucleus of facts. The court, therefore, finds that 5 res judicata precludes the claims in the present suit against Wells Fargo and Freddie Mac 6 and therefore grants Wells Fargo and Freddie Mac’s motion to dismiss. 7 D. Leave to Amend 8 Mr. Carlson has asked the court for leave to file a second amended complaint. 9 (Pl.’s Mot.) Ordinarily, under Federal Rule of Civil Procedure 15(a), leave to amend is 10 “freely given when justice so requires.” Sharkey v. O'Neal, 778 F.3d 767, 774 (9th Cir. 11 2015) (quoting Foman v. Davis, 371 U.S. 178 (1962)) (quotation marks omitted). Courts 12 consider five factors when deciding whether to grant a leave to amend: “bad faith, undue 13 delay, prejudice to the opposing party, futility of amendment, and whether the plaintiff 14 has previously amended the complaint.” United States v. Corinthian Colleges, 655 F.3d 15 984, 995 (9th Cir. 2011) (citing Johnson v. Buckley, 356 F.3d 1067, 1077 (9th Cir. 2004). 16 The court is not required to consider every factor in each case. Davis v. Astrue, 17 250 F.R.D. 476, 480 (N.D. Cal. 2008). Indeed, “[f]utility alone can justify the denial of a 18 motion to amend.” Nunes v. Ashcroft, 375 F.3d 805, 808 (9th Cir. 2004); see also 19 Carrico v. City & Cnty. of San Francisco, 656 F.3d 1002, 1008 (9th Cir. 2011); Gordon 20 v. City of Oakland, 627 F.3d 1092, 1094 (9th Cir. 2010). Amendment is futile if it is 21 evident that the complaint could not be saved by amendment. United States v. Corinthian 22 Colleges, 655 F.3d 984, 995 (9th Cir. 2011). The Ninth Circuit has explained that ORDER- 14 1 “[l]eave to amend need not be given if a complaint, as amended, is subject to dismissal.” 2 Moore v. Kayport Package Exp., Inc., 885 F.2d 531, 538 (9th Cir. 1989). Bad faith, 3 undue delay, and prejudice may be found when the proposed amendment “will not save 4 the complaint or the plaintiff merely is seeking to prolong the litigation by adding new 5 but baseless legal theories.” Griggs v. Pace Am. Grp., Inc., 170 F.3d 877, 881 (9th Cir. 6 1999). 7 The court recognizes that “a pro se complaint, however inartfully pleaded, must be 8 held to less stringent standards than formal pleadings drafted by lawyers.” Erickson v. 9 Pardus, 551 U.S. 89, 94 (2007) (quoting Estelle v. Gamble, 429 U.S. 97, 106 (1976)) 10 (internal quotation marks omitted). In considering whether to permit pro se plaintiffs to 11 amend their complaints, however, “federal courts are far less charitable when one or 12 more amended pleadings already have been filed with no measurable increase in clarity.” 13 5 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1217 (3d 14 ed. 2004); see also Schmidt v. Herrmann, 614 F.2d 1221, 1224 (9th Cir. 1980) (affirming 15 dismissal of second amended complaint with prejudice where pleading consisted of 16 “confusing, distracting, ambiguous, and unintelligible” allegations). 17 The court has already noted that Mr. Carlson’s First Amended Complaint is 18 difficult to decipher. Large portions appear more than once verbatim, most of his claims 19 invoke laws that either simply do not exist, or that are inapplicable in this case. 5 Indeed, 20 21 5 For example, in both the First Amended Complaint and the proposed Second Amend Complaint Mr. Carlson alleges that Freddie Mac violated “Business and Professions Code 22 Section 17200.” (FAC at ¶¶ 176-81, SAC at ¶¶ 136-41.) There is no such law in Washington. ORDER- 15 1 the bulk of the complaint seems to have been copied and pasted—with minimal 2 alterations—from an entirely unrelated case filed in the Eastern District of California. 3 See Jensen v. Quality Loan Serv. Corp., 702 F. Supp. 2d 1183 (C.D. Cal. 2013). The 4 proposed SAC is largely identical to the FAC, save for the deletion of a few paragraphs, 5 the unexplained addition of parties, 6 and the inexplicable alteration of dates and dollar 6 figures. 7 The proposed Second Amended Complaint does nothing to address the fact that 7 Mr. Carlson’s claims against Wells Fargo and Freddie Mac are barred by res judicata, in 8 addition to expired statutes of limitations, and other impairments. Indeed, Mr. Carlson’s 9 motion requesting leave to amend appears also to have been copied almost verbatim from 10 yet another entirely unrelated case. 8 Mr. Carlson has failed to demonstrate that 11 permitting another amendment to his complaint would cure any of the fatal defects raised 12 13 The court presumes that Mr. Carlson intends to reference the California Business and Professions Code, which is inapplicable in this case because all of the events at issue took place in the state 14 of Washington. (See generally FAC.) Even if California law did, somehow, apply, the court would still dismiss Mr. Carlson claims, because neither the First Amended Complaint nor the 15 proposed Second Amended Complaint present any facts to support the conclusory allegations that Freddie Mac or Wells Fargo violated the California unfair competition law. (See FAC at ¶¶ 176-81, SAC at ¶¶ 136-41.) 16 6 Mr. Carlson has added “JP Morgan Chase” and “Loan City” as defendants in the 17 proposed SAC, but has not included any specific allegations against them. 18 7 21 8 For example, paragraph 16 of the First Amended Complaint alleges that Mr. Carlson sent a letter to Wells Fargo “on or about July 5, 2011” pursuant to the RESPA, to which Wells 19 Fargo failed to respond. Paragraph 15 of the proposed Second Amended Complaint is identical, with the exception that the date on which the letter was allegedly sent is changed to “on or about 20 November 5, 2007”—more than two years before the Carlsons secured the loan from Wells Fargo. (See Note). 22 See F.T.C. v. Phoebe Putney Health Sys., Inc., No. 11-cv-58 (WLS), 2013 WL8843916 (M.D. Ga. April 9, 2013). ORDER- 16 1 by Wells Fargo and Freddie Mac. See Corinthian Colleges, 655 F.3d at 995. The court, 2 therefore, concludes that permitting amendment here would be futile. 3 The court also finds evidence of bad faith, prejudice, and undue delay in Mr. 4 Carlson’s attempt to amend his complaint. The proposed Second Amended Complaint 5 will provide Mr. Carlson “with no practical benefits.” Wood v. Santa Barbara Chamber 6 of Commerce, 705 F.2d 1515, 1520 (9th Cir. 1983). The timing of the motion to amend, 7 Mr. Carlson’s behavior throughout this dispute, and the overall futility of amendment 8 persuade the court that Mr. Carlson “merely is seeking to prolong the litigation by adding 9 new but baseless legal theories.” Griggs v. Pace Am. Grp., Inc., 170 F.3d 877, 881 (9th 10 Cir. 1999). Accordingly, the court denies Mr. Carlson’s motion to amend his complaint. 11 IV. 12 CONCLUSION For the foregoing reasons, the court GRANTS Defendants’ motion to dismiss 13 (Dkt. # 7), DISMISSES all claims against Wells Fargo and Freddie Mac WITH 14 PREJUDICE, and DENIES Mr. Carlson’s motion for leave to amend his complaint (Dkt. 15 # 13). 16 Dated this 30th day of April, 2015. 18 A 19 JAMES L. ROBART United States District Judge 17 20 21 22 ORDER- 17

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