Nguyen v. Bank

Decision Date27 October 2010
Docket NumberNo. C–10–4081–EDL.,C–10–4081–EDL.
CourtU.S. District Court — Northern District of California
PartiesTony Phat NGOC NGUYEN, Plaintiff,v.WELLS FARGO BANK, N.A. et al., Defendants.

749 F.Supp.2d 1022

Tony Phat NGOC NGUYEN, Plaintiff,
v.
WELLS FARGO BANK, N.A. et al., Defendants.

No. C–10–4081–EDL.

United States District Court, N.D. California.

Oct. 27, 2010.


[749 F.Supp.2d 1023]

Jamilla Ann Moore, Law Office of Jamilla Moore, Elk Grove, CA, for Plaintiff.Mark Tyler Flewelling, Esq., Yaw–Jiun Wu, Anglin Flewelling Rasmussen Campbell & Trytten LLP, Pasadena, CA, Edward Rick Buell, III, John B. Sullivan, Severson & Werson A Professional Corporation, San Francisco, CA, for Defendants.

[749 F.Supp.2d 1024]

AMENDED ORDER DENYING MOTION TO REMAND; DENYING MOTION FOR SANCTIONS; GRANTING MOTION TO DISMISS; DENYING MOTION TO STRIKE AS MOOT

ELIZABETH D. LAPORTE, United States Magistrate Judge.

This Order is hereby AMENDED to correct a typographical error in the Court's October 25, 2010 Order wherein the Court mistakenly identified Wells Fargo Bank, N.A.'s main office as being located in North Dakota, as opposed to South Dakota where the evidence shows that its main office is actually located. The Order remains unchanged from the previous version in all other respects.

I. Introduction

On August 6, 2010, Plaintiff Tony Phat Ngoc Nguyen filed a complaint in Contra Costa County Superior Court against Defendants Wells Fargo Bank, N.A. (also known as Wachovia Mortgage, a division of Wells Fargo Bank, N.A.M. and formerly known as Wachovia Mortgage FSB, formerly known as World Savings Bank, FSB) (“Wells Fargo”) and Executive Trustee Services, LLC (“ETS”) alleging wrongful foreclosure, violation of California Civil Code § 2923.5 and 2924, fraudulent misrepresentation, fraudulent concealment, conspiracy to defraud, unconscionability, quiet title, violation of California Business & Professions Code § 17200, conversion, and declaratory and injunctive relief. Wells Fargo filed a notice of removal to federal court on September 10, 2010 based on diversity jurisdiction, and ETS consented to and joined in the removal. On September 17, 2010, Wells Fargo filed a motion to dismiss all claims and to strike the punitive damages and other allegations. On September 28, 2010, Plaintiff filed a motion to remand and motion for sanctions. The Court elected to hear all four motions together on October 26, 2010. The Court now finds that all four motions are appropriate for resolution without the need for oral argument, and hereby Orders as follows: Plaintiff's motion to remand and motion for sanctions are DENIED. Wells Fargo's motion to dismiss is GRANTED. Wells Fargo's motion to strike is DENIED AS MOOT.

II. Requests for Judicial Notice

In support of its motion to dismiss, Wells Fargo filed a request for judicial notice of various publicly filed documents. See Wells Fargo's RJN. Exs. A–N. When considering a motion to dismiss, a court does not normally look beyond the complaint in order to avoid converting a motion to dismiss into a motion for summary judgment. See Mack v. South Bay Beer Distributors, 798 F.2d 1279, 1282 (9th Cir.1986), overruled on other grounds by Astoria Fed. Sav. & Loan Ass'n v. Solimino, 501 U.S. 104, 111 S.Ct. 2166, 115 L.Ed.2d 96 (1991). The two exceptions to this rule are: 1) the court may properly take judicial notice of material which is included as part of the complaint or relied upon by the complaint; and 2) the court may properly take judicial notice of matters in the public record. See Lee v. City of Los Angeles, 250 F.3d 668, 688–69 (9th Cir.2001). Under Federal Rule of Evidence 201(b), a “judicially noticed fact must be one not subject to reasonable dispute in that it is either: (1) generally known within the territorial jurisdiction of the trial court; or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” Furthermore, a court “shall take judicial notice if requested by a party and supplied with the necessary information.” See Fed.R.Evid. 201(d); Mullis v. United States Bankruptcy Court for Dist. of Nevada, 828 F.2d 1385, 1388 n. 9 (9th Cir.1987). Here, Plaintiff does not

[749 F.Supp.2d 1025]

challenge the authenticity of the documents contained in Wells Fargo's Request for Judicial Notice, and they are judicially noticeable under Federal Rule of Evidence 201. Plaintiff has also filed a request for judicial notice in connection with his motion to remand and reply in support thereof. Wells Fargo does not challenge the authenticity of the documents contained in Plaintiff's Requests for Judicial Notice, and they are judicially noticeable as well. Therefore, to the extent necessary to rule on the pending motions, the Court has considered the parties' judicially noticeable exhibits.

III. Facts

On or about June 12, 2006, Plaintiff and World Savings Bank executed a 30–year adjustable rate home refinance loan of $712,000.00 secured by a deed of trust on his property. Compl. ¶¶ 13–14. Plaintiff made payments of an undetermined amount from approximately July 15, 2006 through September 2008. Id. ¶ 16. Beginning in 2008, Plaintiff attempted to obtain a loan modification, payment abatements or other means to avoid foreclosure without success. Id. ¶ 16. On December 5, 2008, Wachovia Mortgage, FSB, f.k.a. World Savings Bank executed a substitution of trustee making ETS the trustee under the deed of trust. Id. ¶ 17. On December 19, 2008, ETS recorded a notice of default and election to sell under the deed of trust, claiming that Plaintiff was in arrears on his mortgage payments in the amount of $17,205.85. Id. ¶ 18. On July 22, 2009, ETS executed and recorded a notice of trustee's sale with sale date of January 8, 2010, though no sale has yet occurred. Id. ¶¶ 19–20. On May 27, 2009, Plaintiff filed Chapter 7 bankruptcy and the property was made part of the bankruptcy estate. Id. ¶ 20; but see Wells Fargo's RJN, Ex. H (bankruptcy filing was on May 12, 2010).

Plaintiff's complaint makes ten claims which allege three basic categories of wrongdoing by Defendants. First, Plaintiff claims that there have been improprieties in the beneficiary and trustee assignments and/or substitutions (including an improper severance of the deed of trust and the promissory note) such that no Defendant is currently properly appointed or authorized to foreclose on his property. Compl. ¶¶ 22–28 (Claim 1 for wrongful foreclosure); ¶¶ 81–83 (Claim 7 for quiet title); ¶¶ 85–87 (Claim 8 for violation of § 17200); ¶¶ 90–91 (Claim 9 for conversion); ¶¶ 93–98 (Claim 10 for declaratory and injunctive relief). Plaintiff also claims that Defendants failed to comply with California's pre-foreclosure statutory requirements so the foreclosure is invalid. Id. ¶¶ 31–37 (Claim 2 for violation of Civil Code § 2923.5 and 2924); ¶¶ 57–66 (Claim 5 for conspiracy); ¶¶ 85–87 (Claim 8 for violation of § 17200); ¶¶ 90–91 (Claim 9 for conversion); ¶¶ 93–98 (Claim 10 for declaratory and injunctive relief). Finally, Plaintiff alleges various improprieties and misrepresentations during the origination of his mortgage. Id. ¶¶ 40–50 (Claim 3 for fraudulent misrepresentation); ¶¶ 52–55 (Claim 4 for fraudulent concealment); ¶¶ 57–66 (Claim 5 for conspiracy); ¶ 69–78 (Claim 6 for unconscionability); ¶¶ 85–87 (Claim 8 for violation of § 17200); ¶¶ 90–91 (Claim 9 for conversion); ¶¶ 93–98 (Claim 10 for declaratory and injunctive relief).

IV. Plaintiff's Motion to Remand and for Sanctions

Wells Fargo removed this action on the basis of diversity of citizenship, claiming that it is a citizen of South Dakota and therefore complete diversity exists.1

[749 F.Supp.2d 1026]

Plaintiff now moves to remand on the basis that both Plaintiff and Wells Fargo are citizens of California, and that Defendants cannot show that the jurisdictional minimum of $75,000 has been met.

A. Legal Standard

“Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending.” 28 U.S.C. § 1441(a). “If at any time before final judgment, it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c).

The Ninth Circuit “strictly construe[s] the removal statute against removal jurisdiction.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir.1992) (citations omitted). Thus, “[f]ederal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance.” Id. (citation omitted). “The ‘strong presumption’ against removal jurisdiction means that the defendant always has the burden of establishing that removal is proper.” Id.; see also Abrego v. Dow Chemical Co., 443 F.3d 676, 685 (9th Cir.2006). Removal jurisdiction may be based on diversity of citizenship or on the existence of a federal question. 28 U.S.C. § 1441. Whether removal jurisdiction exists must be determined by reference to the well-pleaded complaint. Merrell Dow Pharmaceuticals, Inc. v. Thompson, 478 U.S. 804, 808, 106 S.Ct. 3229, 92 L.Ed.2d 650 (1986).

B. Discussion

The Complaint alleges that Plaintiff is a citizen of California. Compl. ¶ 1. The Complaint further alleges that “Wells Fargo Bank, N.A., also known as Wachovia Mortgage, a division of Wells Fargo Bank, NAM and formerly known as Wachovia Mortgage, FSB, formerly known as World Savings Bank, FSB” was a Delaware corporation using a business address in Contra Costa County, California. Id. ¶ 2. It also alleges that ETS has a business address and was doing business in California. Id. ¶ 5. Plaintiff argues that the face of the complaint makes no allegations about the corporate headquarters or principal place of business of either defendant, and that Wells Fargo's contention in the notice of removal that it is a citizen of South Dakota for purposes of diversity is false and sanctionable. Plaintiff also argues that the jurisdictional minimum has not been...

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