Estillore v. Fsb

• Decision Date: 02 February 2011
• Docket Number: CASE NO. CV F 10-1243 LJO GSA
• Parties: SEVERINO L. ESTILLORE, JR., Plaintiff, v. COUNTRYWIDE BANK FSB, et al., Defendants.
• Court: U.S. District Court — Eastern District of California

SEVERINO L. ESTILLORE, JR., Plaintiff,

v.COUNTRYWIDE BANK FSB, et al., Defendants.

CASE NO. CV F 10-1243 LJO GSA

UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

Date: February 2, 2011

DEFENDANTS' F.R.Civ.P. 12 MOTION TO DISMISS (Doc. 19.)

INTRODUCTION

Defendants Countrywide Bank FSB ("Countrywide"), ReconTrust Company, N.A. ("ReconTrust"), and Mortgage Electronic Registration Systems, Inc. ("MERS") seek to dismiss as insufficiently pled and legally barred pro se plaintiff Severino Estillore, Jr.'s ("Mr. Estillore's") claims arising from his defaulted home loans. This Court considered Countrywide, ReconTrust and MERS' (collectively the "lender defendants'") F.R.Civ.P. 12(b)(6) motion to dismiss on the record and VACATES the March 3, 2011 hearing, pursuant to Local Rule 230(g). For the reasons discussed below, this Court DISMISSES this action.

BACKGROUND

Mr. Estillore's Loans

On May 2, 2007, Mr. Estillore obtained from Countrywide $458,400 and $57,300 loans secured by deeds of trust on his Fresno residential property ("property"). The deeds of trust identified Mr. Estillore as borrower, Countrywide as lender, ReconTrust as trustee, and MERS as beneficiary. Mr. Estillore's operative complaint ("complaint") identifies the $458,400 loan as a 40-year monthly adjustable rate mortgage and the $57,300 loan as fixed rate with a balloon payment in 15 years. Mr. Estillore defaulted on the loans, and the property is subject to non-judicial foreclosure.

Mr. Estillore's Claims

On July 12, 2010, Mr. Estillore filed his 34-page complaint to allege 18 claims under federal and California statues and common law. The complaint's gist is that Mr. Estillore obtained loans for which he was unqualified and could not afford. The complaint seeks a variety of damages and declaratory and injunctive relief that the property is not subject to non-judicial foreclosure.

DISCUSSION

F.R.Civ.P. 12(b)(6) Motion To Dismiss Standards

The lender defendants seek to dismiss the complaint's claims as incognizable, insufficiently pled and time barred.

"A trial court may dismiss a claim sua sponte under Fed.R.Civ.P. 12(b)(6).... Such dismissal may be made without notice where the claimant cannot possibly win relief." Omar v. Sea-Land Service, Inc., 813 F.2d 986, 991 (9^th Cir. 1987); see Wong v. Bell, 642 F.2d 359, 361-362 (9^th Cir. 1981). Sua sponte dismissal may be made before process is served on defendants. Neitzke v. Williams, 490 U.S. 319, 324 (1989) (dismissals under 28 U.S.C. § 1915(d) are often made sua sponte); Franklin v. Murphy, 745 F.2d 1221, 1226 (9^th Cir. 1984) (court may dismiss frivolous in forma pauperis action sua sponte prior to service of process on defendants).

"When a federal court reviews the sufficiency of a complaint, before the reception of any evidence either by affidavit or admissions, its task is necessarily a limited one. The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." Scheurer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683 (1974); Gilligan v. Jamco Development Corp., 108 F.3d 246, 249 (9^th Cir. 1997). A F.R.Civ.P. 12(b)(6) dismissal is proper where there is either a "lack of a cognizable legal theory" or "the absence of sufficient facts alleged under a cognizable legal theory." Balisteri v. Pacifica Police Dept., 901 F.2d 696, 699 (9^th Cir. 1990); Graehling v. Village of Lombard, Ill., 58 F.3d 295, 297 (7^th Cir. 1995).

In addressing dismissal, a court must: (1) construe the complaint in the light most favorable to the plaintiff; (2) accept all well-pleaded factual allegations as true; and (3) determine whether plaintiff can prove any set of facts to support a claim that would merit relief. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-338 (9th Cir. 1996). Nonetheless, a court is not required "to accept as true allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences." In re Gilead Sciences Securities Litig., 536 F.3d 1049, 1055 (9^th Cir. 2008) (citation omitted). A court "need not assume the truth of legal conclusions cast in the form of factual allegations, " U.S. ex rel. Chunie v. Ringrose, 788 F.2d 638, 643, n. 2 (9^th Cir.1986), and a court must not "assume that the [plaintiff] can prove facts that it has not alleged or that the defendants have violated... laws in ways that have not been alleged." Associated General Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S. 519, 526, 103 S.Ct. 897 (1983). A court need not permit an attempt to amend if "it is clear that the complaint could not be saved by an amendment." Livid Holdings Ltd. v. Salomon Smith Barney, Inc., 416 F.3d 940, 946 (9^th Cir. 2005).

A "plaintiff's obligation to provide the 'grounds' of his 'entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly, 550 U.S. 554, 127 S. Ct. 1955, 1964-65 (2007) (internal citations omitted). Moreover, a court "will dismiss any claim that, even when construed in the light most favorable to plaintiff, fails to plead sufficiently all required elements of a cause of action." Student Loan Marketing Ass'n v. Hanes, 181 F.R.D. 629, 634 (S.D. Cal. 1998). In practice, "a complaint... must contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory." Twombly, 550 U.S. at 562, 127 S.Ct. at 1969 (quoting Car Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101, 1106 (7^th Cir. 1984)).

In Ashcroft v. Iqbal, __ U.S. _, 129 S.Ct. 1937, 1949 (2009), the U.S. Supreme Court recently explained:

... a complaint must contain sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face."... 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.... The plausibility standard is not akin to a "probability requirement, " but it asks for more than a sheer possibility that a defendant has acted unlawfully. (Citations omitted.)

After discussing Iqbal, the Ninth Circuit Court of Appeals summarized: "In sum, for a complaint to survive [dismissal], the non-conclusory 'factual content, ' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. Secret Service, 572 F.3d 962, 989 (9^th Cir. 2009) (quoting Iqbal, __ U.S. _, 129 S.Ct. at 1949).

The U.S. Supreme Court applies a "two-prong approach" to address dismissal:

First, the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.... Second, only a complaint that states a plausible claim for relief survives a motion to dismiss.... Determining whether a complaint states a plausible claim for relief will... be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.... But where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not "show[n]"-"that the pleader is entitled to relief." Fed. Rule Civ. Proc. 8(a)(2).

In keeping with these principles a court considering a motion to dismiss can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth. While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations. When there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.

Iqbal, __ U.S. _, 129 S.Ct. at 1949-1950.

Moreover, a limitations defense may be raised by a F.R.Civ.P. 12(b)(6) motion to dismiss. Jablon v. Dean Witter & Co., 614 F.2d 677, 682 (9^th Cir. 1980); see Avco Corp. v. Precision Air Parts, Inc., 676 F.2d 494, 495 (11^th Cir. 1982), cert. denied, 459 U.S. 1037, 103 S.Ct. 450 (1982). A F.R.Civ.P. 12(b)(6) motion to dismiss may raise the limitations defense when the statute's running is apparent on the complaint's face. Jablon, 614 F.2d at 682. If the limitations defense does not appear on the complaint's face and the trial court accepts matters outside the pleadings' scope, the defense may be raised by a motion to dismiss accompanied by affidavits. Jablon, 614 F.2d at 682; Rauch v. Day and Night Mfg. Corp., 576 F.2d 697 (6^th Cir. 1978).

For a F.R.Civ.P. 12(b)(6) motion, a court generally cannot consider material outside the complaint. Van Winkle v. Allstate Ins. Co., 290 F.Supp.2d 1158, 1162, n. 2 (C.D. Cal. 2003). Nonetheless, a court may consider exhibits submitted with the complaint. Durning v. First Boston Corp., 815 F.2d 1265, 1267 (9^th Cir. 1987);Van Winkle, 290 F.Supp.2d at 1162, n. 2. In addition, a "court may consider evidence on which the complaint 'necessarily relies' if: (1) the complaint refers tothe document; (2) the document is central to the plaintiff's claim; and (3) no party questions the authenticity of the copy attached to the 12(b)(6) motion." Marder v. Lopez, 450 F.3d 445, 448 (9^th Cir. 2006). A court may treat such a document as "part of the complaint, and thus may assume that its contents are true for purposes of a motion to dismiss under Rule 12(b)(6)." United States v. Ritchie, 342 F.3d 903, 908 (9th Cir.2003). Such consideration prevents "plaintiffs from surviving a Rule 12(b)(6) motion by deliberately omitting reference to documents upon which their claims are based." Parrino v. FHP, Inc., 146 F.3d 699, 706 (9^th Cir. 1998).¹ A "court may disregard allegations in the complaint if contradicted by facts established by...