Bess v. Ocwen Loan Servicing LLC, CASE NO. C15-5020 BHS
| Decision Date | 08 January 2020 |
| Docket Number | CASE NO. C15-5020 BHS |
| Court | U.S. District Court — Western District of Washington |
| Parties | NANCY BESS, Plaintiff, v. OCWEN LOAN SERVICING LLC, Defendant. |
This matter comes before the Court on Plaintiff Nancy Bess's ("Bess") motion for class certification, Dkt. 65, and Defendant Ocwen's Loan Servicing, LLC's ("Ocwen") motion to exclude expert testimony, Dkt. 106. The Court has considered the pleadings filed in support of and in opposition to the motions and the remainder of the file and hereby denies the motion for class certification and denies the motion to exclude expert testimony for the reasons stated herein.
On November 10, 2014, Bess filed a class action complaint against Ocwen in the Kitsap County Superior Court for the State of Washington. Dkt. 1, Ex. A. On January 12, 2015, Ocwen removed the case to this Court. Dkt. 1. On January 13, 2015, Ocwen filed a motion to dismiss. Dkt. 6.
On March 16, 2015, the Court granted the motion to dismiss with leave to amend. Dkt. 22. On March 27, 2015, Bess filed her first amended complaint. Dkt. 23. Bess alleged the following claims against Ocwen: (1) common law trespass; (2) statutory trespass; (3) violation of RCW 7.28.230; (4) violation of the Deed of Trust Act; (5) violations of the Consumer Protection Act ("CPA"); (6) breach of contract; and (7) unjust enrichment. Id. ¶¶ 5.1-13.11. On April 9, 2015, Ocwen filed a second motion to dismiss. Dkt. 24. On June 1, 2015, the Court granted the motion to dismiss with leave to amend. Dkt. 31. On June 9, 2015, Bess filed a notice of intent not to amend. Dkt. 32. On June 18, 2015, the Court dismissed Bess's claims with prejudice. Dkt. 34. On July 6, 2015, Bess filed a notice of appeal. Dkt. 35. On March 9, 2018, the Ninth Circuit issued its memorandum disposition affirming in part, reversing in part, and remanding, Dkt. 39, and on April 2, 2018, the Ninth Circuit entered its mandate, Dkt. 42.
The Ninth Circuit reviewed in light of the Washington Supreme Court's July 7, 2016 decision in Jordan v. Nationstar Mortgage, LLC, 185 Wn. 2d 876 (2016) ("Jordan"). Dkt. 39.1 In Jordan, the Washington Supreme Court evaluated deed of trustprovisions which authorize a lender to enter the borrower's property after default and prior to foreclosure, concluding that they permit the lender to take possession of the property prior to foreclosure in conflict with state law. Jordan, 185 Wn.2d at 883. The Washington Supreme Court explained:
By changing the locks [the loan servicer] took possession of the property. Since these actions are authorized by the entry provisions, the entry provisions allow the lender to take possession of the property. Because Washington law prohibits lenders from taking possession of the borrower's property before foreclosure, the provisions are in conflict with state law.
In light of Jordan, the parties conceded that Ocwen's defense that its entry onto Bess's property was privileged based on entry provisions in the deed of trust is no longer valid, rendering Bess's common law trespass claim well-pleaded. Dkt. 39 at 2. The Ninth Circuit found that in light of Jordan, Bess's claim for statutory trespass under RCW 4.24.630 was also well-pleaded, explaining that Bess's allegations "are sufficient to show a reasonably foreseeable invasion of Bess's property, which would affect Bess's exclusive possession and interest in the property." Id. at 2-3 (citing Grundy v. Brack Family Tr., 151 Wn. App. 557, 566 (2009)). The Circuit explained it was "plausible that Ocwen was aware its conduct was unlawful . . . ." Id. at 4 (citation omitted). The Circuit also concluded Ocwen's alleged conduct "could constitute unfair or deceptive acts" in violation of Washington's CPA. Id. The Circuit affirmed the dismissal of Bess's remaining claims and affirmed that Bess lacked standing to bring claims on behalf of herlate husband's estate. Id. at 5-6. On April 16, 2019, Ocwen answered Bess's amended complaint. Dkt. 43.
On May 8, 2018, the Court entered an order setting a schedule for class certification briefing. Dkt. 49. On January 17, 2019, Ocwen filed a motion to stay the matter pending resolution of the appeal in Bund v. Safeguard Properties, LLC, No. C16-920 MJP, 2018 WL 5112642 (W.D. Wash. Oct. 19, 2018), appeal filed sub nom James v. Safeguard Properties, LLC, No. 18-35953 (9th Cir.). Dkt. 59.
On March 15, 2019, Bess filed a motion to certify a class with the following membership:
All persons who own or owned real property in Washington subject to a deed of trust or mortgage serviced or held by Ocwen whose property Ocwen or its agents Altisource or CoreLogic entered prior to the completion of a foreclosure sale and changed one or more lock between November 10, 2010 and July 7, 2016.
Dkt. 65 at 14-15. On June 7, 2019, Ocwen responded to the motion for class certification. Dkt. 86. On June 28, 2019, the Court denied Ocwen's motion to stay. Dkt. 98. On July 26, 2019, Bess replied to her motion for class certification. Dkt. 100.
On July 31, Ocwen surreplied seeking to strike all testimony from Bess's expert Dr. John A. Kilpatrick ("Kilpatrick"), which Bess submitted in support of her motion for certification. Dkt. 105. On August 9, 2019, Ocwen filed a motion to exclude Kilpatrick's testimony from the class certification record. Dkt. 106. On August 26, 2019, Bess responded. Dkt. 108. On August 29, 2019, Ocwen replied. Dkt. 110.
On November 21, 2019, Ocwen filed a notice of supplemental authority. Dkt. 111.
In 2000, Gary Bess purchased a single-family residence in Port Orchard, Washington ("Bess residence"). Dkt. 23, ¶ 4.1. In 2007, Gary Bess married Nancy Bess. Id. ¶ 4.2. Gary Bess and Nancy Bess resided at the Bess residence. Id.
In November 2007, Gary Bess obtained a mortgage loan from GMAC Mortgage, LLC. Id. ¶ 4.3. The loan was secured by a Deed of Trust on the Bess residence. Id. ¶ 4.4. Although Gary Bess is identified as the sole borrower on the Deed of Trust, both Gary Bess and Nancy Bess executed the Deed of Trust. Dkt. 7, Declaration of Joanne Hepburn, Ex. 1 at 2, 15.2
The Deed of Trust obligates the borrower to "pay when due the principal of, and interest on, the debt evidenced by the Note and any prepayment charges and late charges due under the Note." Id. at 5. If the borrower fails to comply with the Deed of Trust's provisions, the lender or its successors and assigns may take certain actions to secure the property. Id. at 9. The Deed of Trust provides in relevant part as follows:
On May 27, 2012, Gary Bess died intestate. Dkt. 23, ¶ 4.9. Nancy Bess declared that when her husband died, she became the sole owner of the Bess residence. Dkt. 70, ¶ 2. She declared that a few months later, she purchased a small cabin, staying in the cabin occasionally and the Bess residence regularly. Id. The loan obligations for the Bess residence became delinquent following Gary Bess's death. Dkt. 23, ¶ 4.10.
Bess declared that on October 29, 2013, Ocwen's vendor CoreLogic changed the locks on the Bess residence. Dkt. 70, ¶ 3. In deposition, Bess testified that she changed the locks back within eight days and her locks remained on the property from early November 2013 until February or March 2014 when they were changed again. Dkt. 90-1 at 85-87. Bess declares that she believes Ocwen charged her inspection and property preservation fees each time it entered her home. Dkt. 70, ¶ 4. Bess declares that Ocwen initiated non-judicial foreclosure proceedings on March 7, 2014 and foreclosure was completed on July 29, 2014. Id. ¶ 5.
"Class certification is governed by Federal Rule of Civil Procedure 23." Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 345 (2011). "As the party seeking class certification, [Plaintiff] bears the burden of demonstrating that [she] has met each of the four requirements of Rule 23(a) and at least one of the requirements of Rule 23(b)." Zinser v. Accufix Research Inst., Inc., 253 F.3d 1180, 1186 (9th Cir. 2001), amended by 273 F.3d 1266 (9th Cir. 2001). The four requirements of Rule 23(a) are: (1) numerosity; (2)commonality; (3) typicality; and (4) adequacy of representation. Parsons v. Ryan, 754 F.3d 657, 674 (9th Cir. 2014).
"Rule 23 does not set forth a mere pleading standard." Dukes, 564 U.S. at 350. Rather, "[a] party seeking class certification must affirmatively demonstrate his compliance with the Rule—that is, he must be prepared to prove that there are in fact sufficiently numerous parties, common questions of law or fact, etc." Id. Before certifying a class, the Court must conduct a "rigorous analysis" to determine whether Bess has met the requirements of Rule 23. Zinser, 253 F.3d at 1186.
Here, Bess seeks certification under Rule 23(b)(3). Dkt. 65 at 8. A class action may be maintained under Rule 23(b)(3) if "questions of law or fact common to class members predominate over any questions affecting only individual members," and if "a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Fed. R. Civ. P. 23(b)(3).
"Rule 23(b)(3)'s predominance criterion is even more demanding than Rule...
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