Esoimeme v. Wells Fargo Bank, CIV S-10-2259 JAM EFB PS
| Decision Date | 01 September 2011 |
| Docket Number | No. CIV S-10-2259 JAM EFB PS,CIV S-10-2259 JAM EFB PS |
| Parties | MATHIAS ESOIMEME, Plaintiff, v. WELLS FARGO BANK; NDEX WEST LLC; WORLD SAVINGS BANK; and DOES 1-100, inclusive, Defendants. |
| Court | U.S. District Court — Eastern District of California |
This case, in which plaintiff is proceeding pro se, is before the undersigned pursuant to Eastern District of California Local Rule 302(c)(21). See 28 U.S.C. § 636(b)(1). On August 23, 2010, defendants Wachovia Mortgage, a division of Wells Fargo Bank, N.A. f/k/a Wachovia Mortgage, FSB, f/k/a World Savings Bank, FSB ("World Savings" or "Wachovia") and Wells Fargo Bank, N.A. ("Wells Fargo") (collectively "Wells Fargo" or the "bank defendants") removed the action to this court from Solano County Superior Court on the ground that plaintiff's complaint alleges federal claims and on the alternative ground that the citizenship of the parties is diverse.1 Dckt. No. 1. Wells Fargo now moves to dismiss and to strike plaintiff'scomplaint. Dckt. Nos. 7, 8.
In this action, plaintiff challenges the origination of a $318,500 refinance loan he entered into with the bank defendants, as well as the procedures defendants followed when foreclosing on plaintiff's home. Specifically, plaintiff alleges that in or around May 2006, he was solicited by World Savings who offered to refinance his residential real property located at 185 Coloma Way in Vallejo, California ("the subject property"). Id. ¶ 10. The subject loan closed in May 2006 as evidenced by the Deed of Trust recorded May 31, 2006 against plaintiff's property. Compl., Ex. C; see also Bank Defs.' Req. for Jud. Notice, Dckt. No. 9, Ex. A.2 Also on May 31, 2006, plaintiff signed an Adjustable Rate Mortgage Note for the subject property. Bank Defs.' Req. for Jud. Notice, Dckt. No. 9, Ex. G.
Plaintiff alleges that World Savings "engaged in wrongful, predatory, and illegal lending practices . . . for the specific, obvious purpose of generating as many sub-prime loans as possible for sale to investors in the United States and abroad." Dckt. No. 1, Ex. A, Compl. ¶ 9. Plaintiff further alleges that World Savings "intentionally used deceptive tactics to induce and convince borrowers to obtain loans that they would not have qualified for under conventional lending practices" and that such practices "resulted in borrowers taking on loans that they obviously were not capable of paying." Id. Plaintiff alleges that he "was one of such victims of defendants' improper marketing and sales effort." Id.
Additionally, plaintiff alleges that World Savings had a conflict of interest in that one of its brokers "was paid a 'yield spread premium' fee (YSP fee) to encourage and steer Plaintiffinto a higher rate loan, which was not the loan Plaintiff had initially wished to undertake" and that the conflict interest and the payment of the YSP fee were concealed from plaintiff at the time the loan was made. Id. ¶ 11. Plaintiff contends that at the time of the solicitation and refinance offer, "World Savings assured Plaintiff that the amount of the proposed Subject loan would not exceed $318,500.00" but that "[a]fter loan closing, it was discovered that Plaintiff was clearly, willfully, and intentionally misled and decieved" by World Savings Bank and the broker. Id. ¶ 12. Plaintiff further alleges that he was rushed and pressured "into signing the loan documentation quickly, without any explanation whatsoever of the terms and legal effect of said loan" and without "providing a copy for him to read, study, or understand." Id. ¶ 13. Plaintiff specifically alleges that "[at] no time prior to [or] at time of executing the Subject Loan documentation did defendant provide Plaintiff with any explanation or clarification of the Security Documents and/or other required disclosures for him to read and review, despite Plaintiff's lack of English proficiency" and that he "was intentionally denied the opportunity to seek legal advice without a copy of the 'Loan Docs.'" Id. ¶ 14.
Plaintiff further alleges that World Savings Bank "used related fraudulent appraisers to give a real estate appraisal that would justify the large loan that was made to Plaintiff" and that defendants knew the value of the subject property was far less than the loan amount and intentionally made a loan to plaintiff that was in excess of the value of the subject property. Id. ¶ 15. Plaintiff alleges that he has lost all equity in the subject property due to that deceitful loan transaction and agreement with defendants and that the agreement is void ab initio because of defendants' violation of their disclosure requirements and their duty to refrain from making misleading statements and fraudulent misrepresentations, and because of their predatory lending practices. Id. Plaintiff alleges that he was "wrongfully and unlawfully induced" by World Savings to refinance the subject property and execute the subject loan and security documents. Id. ¶ 16.
Plaintiff also alleges that he was "willfully and intentionally misled and deceived by the deceptive conspiratorial acts, conduct, and misrepresentations of Defendant Wells Fargo who falsely induced plaintiff into believing that said Defendants were assisting Plaintiff with receiving a reasonable and fair 'Loan Modification' agreement of Plaintiff's loan." Id. ¶ 17. Plaintiff alleges that when those false representations were made, Wells Fargo knew the "statements were untrue and no Loan Modification was being processed or produced on behalf of Plaintiff," and that defendants "instead deceptively planned, schemed, and conspired to mislead and deceive Plaintiff by not qualify[ing] or attempting to qualify Plaintiff for a Loan Modification agreement. Id. ¶¶ 17, 18.
According to plaintiff's complaint, "[a]s a result of the non-payment of the Subject Loan, defendant Wells Fargo demanded a non-judicial foreclosure proceeding against Plaintiff without complying with California [law]" and "did not offer to decrease Plaintiff's principle balance to the fair market value," also in violation of California law. Id. ¶ 19. Plaintiff alleges that he "encountered financial difficulties and defaulted on the loan payments to Defendants," and that therefore, on or around July 8, 2009, defendants filed a Notice of Default and Election to Sell Under Deed of Trust, and on July 9, 2009, defendants filed a Notice of Rescission and Declaration of Default and Demand for Sale and Notice of Default and Election to Sell. Id. ¶ 21. Plaintiff alleges that defendants then "intentionally and unlawfully filed a Notice of Trustee's Sale using the aforementioned Notice of Default" on March 25, 2010 without seeking a Loan Modification on behalf of plaintiff or seeking to modify the terms of the subject loan. Id. ¶¶ 21, 22. A foreclosure took place on July 6, 2010. See Wells Fargo's Req. for Jud. Notice, Dckt. No. 9, Ex. H (Trustee's Deed Upon Sale July 13, 2010 and recorded in the Official Records of the Office of the Solano County Recorder on July 19, 2010).
Plaintiff's complaint states the following causes of action against all defendants: (1) predatory lending practices in violation of the Federal Home Ownership Equity Protection Act, 15 U.S.C. § 1637 ("HOEPA"), the Truth in Lending Act, 15 U.S.C. § 1601 ("TILA"), FederalRegulation Z, 12 C.F.R. § 22, California Civil Code section 1632, and California Business and Professions Code section 17500; (2) conspiracy; (3) intentional misrepresentation/deceit (fraud); (4) violations of California Civil Code sections 1916.7, 1920, and 1921; (5) demand for accounting; (6) unfair business practices in violation of California Business and Professions Code section 17200; (7) breach of the implied warranty of good faith and fair dealing; (8) declaratory relief; (9) quiet title; and (10) injunctive relief. Dckt. No. 1 at 12-23.
Wells Fargo moves to dismiss plaintiff's complaint for failure to state a claim pursuant to Federal Rule of Civil Procedure ("Rule") 12(b)(6) and for failure to state his fraud claims with particularity as required by Rule 9(b). Dckt. No. 7, Mot. to Dismiss ("Mot.") at 2. Wells Fargo also contends that plaintiff's complaint fails to comply with Rule 8 in that the complaint does not present a "short and plain statement" of the claims against defendants.3 Id.
A. Rule 12(b)(6) Standards
To survive dismissal for failure to state a claim pursuant to Rule 12(b)(6), a complaint must contain more than a "formulaic recitation of the elements of a cause of action"; it must contain factual allegations sufficient to "raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). "The pleading must contain something more . . . than . . . a statement of facts that merely creates a suspicion [of] a legally cognizable right of action." Id. (quoting 5 C. Wright & A. Miller, Federal Practice and Procedure § 1216, pp. 235-236 (3d ed. 2004)). "[A] complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (quoting Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. Dismissal is appropriate based either on the lack of cognizable legal theories or the lack of pleading sufficient facts to support cognizable legal theories. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990).
In considering a motion to dismiss, the court must accept as true the allegations of the complaint in question, Hospital Bldg. Co. v. Rex Hosp. Trs., 425 U.S. 738, 740 (1976), construe the pleading in the light most favorable to the party opposing the motion, and resolve all doubts in the pleader's favor. Jenkins v. McKeithen, 395 U.S. 411, 421, ...
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