Rosenfeld v. Bank

• Decision Date: 09 August 2010
• Docket Number: No. C 09-6070 MEJ,C 09-6070 MEJ
• Citation: 732 F.Supp.2d 952
• Parties: Paul E. ROSENFELD, Plaintiff, v. JPMORGAN CHASE BANK, N.A., et al., Defendants.
• Court: U.S. District Court — Northern District of California

732 F.Supp.2d 952

Paul E. ROSENFELD, Plaintiff,

v.JPMORGAN CHASE BANK, N.A., et al., Defendants.

No. C 09-6070 MEJ.

United States District Court,

N.D. California.

Aug. 9, 2010.

Marc A. Fisher, Marc A. Fisher Law Offices, Folsom, CA, Stephen Conrad Ruehmann, Law Offices of Stephen C. Ruehmann, Sacramento, CA, for Plaintiff.

John M. Sorich, Lauren M. Takos, Sung-Min Christopher Yoo, Adorno Yoss Alvarado & Smith, Santa Ana, CA, for Defendants.

ORDER RE DEFENDANTS' MOTION TO DISMISS PLAINTIFF'S FIRST AMENDED COMPLAINT

MARIA-ELENA JAMES, United States Chief Magistrate Judge.

I. INTRODUCTION

Before the Court is Defendants JPMorgan Chase Bank, N.A. ("Chase"), California Reconveyance Company ("CRC"), and Bank of America, N.A.'s ¹ ("BofA") (collectively "Defendants") motion to dismiss Plaintiff's First Amended Complaint. (Dkt. # 10.) After consideration of the parties' papers, relevant legal authority, and good cause appearing, the Court ORDERS as follows.

II. BACKGROUND

In late July 2006, Plaintiff Paul E. Rosenfeld ("Plaintiff") obtained a mortgage loan in the amount of $987,000.00 ("first loan") in connection with the property located at 2811 Monte Cresta Drive, in Belmont, California ("the Subject Property"). (Defs.' Mot. 1:17-18, Dkt. # 10; Pl.'s Opp'n 3:16-17, Dkt. # 13.) The first loan was secured by a Deed of Trust ("first DOT") recorded on July 27, 2006 with the San Mateo County Recorder's Office as instrument number 2006-112029. (Request for Judicial Notice ("RJN"), Ex. 1, Dkt. # 11.) The first DOT of trust identifies Washington Mutual Bank ("WaMu") as the lender, CRC as the trustee, and Plaintiff as the borrower. Id. Attached to the first DOT is an Adjustable Rate Rider, signed by Plaintiff and identified on page two of the first DOT, which provides that the yearly interest rate on unpaid may change monthly, beginning September 2006. (RJN, Ex. 1, Dkt. # 11.) Plaintiff also obtained a home equity line of credit in connection to the Subject Property in the amount of $281.999.00, secured by a second Deed of Trust ("second DOT") recorded on July 27, 2006 with the San Mateo County Recorder's Office as instrument number 2006-112030. (RJN, Ex. 2, Dkt. # 11.) The second DOT identifies WaMu as the beneficiary and Plaintiff as the trustor. Id.

On September 25, 2008, the Office of Thrift Supervision closed WaMu and appointed the FDIC as receiver. (Defs.' Mot. 2:6-7, Dkt. # 10.) On the same date, Chase entered into a Purchase and Assumption Agreement ("Agreement") with the Federal Deposit Insurance Corporation ("FDIC") acting in its corporate capacity as well as receiver for WaMu. Id. at 2:7-9; RJN, Ex. 5, Dkt. # 11. Under Section 2.5 of the Agreement, Chase did not assume liability for borrower claims related to loans or commitments to lend made by WaMu. (RJN, Ex. 5, Dkt. # 11.)

Plaintiff states that he began to experience severe financial problems in January 2009, making it difficult to pay on the first DOT. (First Am. Compl. ("FAC") ¶ 23, Dkt. # 8.) Plaintiff states that he contacted Chase to seek a modification of his loan, and that Chase advised him to be late on his payments to qualify for a modification. Id. Plaintiff states that he stopped making loan payments in April 2009 and submitted loan modification paperwork. Id. Plaintiff claims that he repeatedly phoned Chase, resubmitted his paperwork in July, and was finally told by "Charmeka" at Chase on August 26, 2009, that all of Plaintiff's documentation had been received and a representative had been assigned to work on his modification. Id.

On August 19, 2009, the first DOT was assigned by Chase to BofA and was recorded on August 20, 2009 with the San Mateo County Recorder's Office as instrument number 2009-112228. (RJN, Ex. 3, Dkt. # 11.) On August 20, 2009, CRC, as trustee of the first DOT, recorded a Notice of Default ("NOD") with the San Mateo County Recorder's Office as instrument number 2009-112229. (RJN, Ex. 4, Dkt. # 11.) Plaintiff alleges that Chase did not contact him to discuss options to pay the loan prior to issuing the NOD. Id. at ¶ 27.

On September 8, 2009, Plaintiff contacted "Alex" at Chase and told him he received the NOD. (FAC ¶ 25, Dkt. # 8.) Plaintiff states that Alex told him "not to worry" and requested additional documents, which Plaintiff provided. Id. Plaintiff contacted Chase again in October of 2009, only to be informed that he had to resubmit all of his information. Id. Plaintiff resubmitted his information and now alleges that Chase has failed to contact him or make any progress on his loan modification application. Id. In the meantime, Plaintiff had also filed for bankruptcy. Id.

On December 30, 2009, Plaintiff filed his initial Complaint in this matter, and subsequently filed his FAC on April 12, 2010 alleging twelve causes of action: Wrongful Foreclosure; Rescission and Restitution under 15 U.S.C. § 1635; Reformation under California Civil Code sections 3399 and 1670.5; violation of the Real Estate Settlement Procedures Act, 12 U.S.C. § 2605 et seq. ; Breach of Contract and Implied Covenant of Good Faith and Fair Dealing; Breach of Fiduciary Duty; Fraudulent Misrepresentation; Fraudulent Concealment; Civil Conspiracy to Defraud; violation of California Business and Professions Code section 17200 et seq. ; Quiet Title to Real Property; and for Declaratory and Injunctive Relief. (Dkt. # 8.)

On April 29, 2010, Defendants filed their motion to dismiss Plaintiff's FAC. (Dkt. # 10.) On May 20, 2010, Plaintiff filed his opposition (Dkt. # 13), and on May 27, 2010, Defendants filed their reply (Dkt. # 14). On June 10, 2010, the Court held a hearing on the matter, at which Plaintiff failed to appear.

III. LEGAL STANDARD

Federal Rule of Civil Procedure ("Rule") 12(b)(6) provides that a defendant may move to dismiss a claim for "failure to state a claim upon which relief can be granted." A motion to dismiss under Rule 12(b)(6) "tests the legal sufficiency of a claim." Navarro v. Block, 250 F.3d 729, 732 (9th Cir.2001). In order to survive a motion to dismiss, a plaintiff must allege "enough facts to state a claim to relief that is plausible on its face." Bell Atlantic v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). In considering a motion to dismiss, a court must accept all of the plaintiff's allegations as true. Id. at 550, 127 S.Ct. 1955; Erickson v. Pardus, 551 U.S. 89, 93-94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007). The plaintiff'scomplaint need not contain detailed factual allegations, but it must contain more than a "formulaic recitation of the elements of a cause of action." Twombly, 550 U.S. at 555, 127 S.Ct. 1955. In reviewing a motion to dismiss, courts may also consider documents attached to the complaint. Parks School of Business, Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir.1995) (citation omitted). In addition, courts may consider a matter that is properly the subject of judicial notice, such as matters of public record. Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir.2001).

In determining whether to dismiss a complaint that alleges time-barred activity, it must appear from the complaint that the plaintiff can prove no set of facts that would establish the timeliness of a claim. Supermail Cargo, Inc. v. U.S., 68 F.3d 1204, 1207 (9th Cir.1995). If the court dismisses the complaint, it "should grant leave to amend even if no request to amend the pleading was made, unless it determines that the pleading could not possibly be cured by the allegation of other facts." Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir.2000).

IV. APPLICATION TO THE CASE AT BAR

A. Defendants' Request for Judicial Notice

As a preliminary matter, on April 29, 2010, Defendants filed a Request for Judicial Notice, (Dkt. # 11), asking the Court to take notice of the following: (1) a copy of the DOT for Plaintiff's property recorded on July 27, 2006 with the San Mateo County Recorder's Office as instrument number 2006-112029; (2) a copy of the second DOT for Plaintiff's property recorded on July 27, 2006 with the San Mateo County Recorder's Office as instrument number 2006-112030; (3) the Assignment of DOT recorded on August 20, 2009 with the San Mateo County Recorder's Office as instrument number 2009-112228; (4) a copy of the Notice of Default ("NOD") recorded August 20, 2009 with the San Mateo County Recorder's Office as instrument number 2009-112229; and (5) the Purchase and Assumption Agreement entered into by Chase and the FDIC, acting as receiver of WaMu. (RJN 1:28-2:13, Dkt. # 11.)

Federal Rule of Evidence 201(b) provides the criteria for judicially noticed facts: "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." As the documents in question are matters of public record, the Court GRANTS Defendants' request for judicial notice. See MGIC Indem. Corp. v. Weisman, 803 F.2d 500, 504 (9th Cir.1986) (A court may take judicial notice of matters of public record outside the pleadings on a motion to dismiss.); W. Fed. Sav. v. Heflin, 797 F.Supp. 790, 792 (N.D.Cal.1992) (taking judicial notice of documents in a county public record, including deeds of trust).

B. Whether Plaintiff's Claims are Properly Brought Against Defendant Chase

Defendants maintain that Plaintiff cannot state any claims against Chase, arguing that under Section 2.5 of the Agreement, Chase did not assume liability for borrower claims related to loans or commitments to lend made by WaMu. (Defs.' Mot. 2:5-6, Dkt. # 10.) Defendants state that the FDIC, not Chase, is the proper party. Id. at 3:5-7. In response, Plaintiff claims that Chase is liable for claims against WaMu because under the Agreement, it agreed to assume all of WaMu'sliabilities. (Pl.'s Opp'n 11:24-28, Dkt. # 13.)

As stated above, on September 25, 2008, Chase acquired...