Sanders v. Tirello

• Decision Date: 23 June 2020
• Docket Number: No. CV 19-470-TUC-CKJ,CV 19-470-TUC-CKJ
• Parties: Douglas Sanders, Plaintiff, v. Joseph Tirello, ZBS Law, LLP, Selene Finance, U.S. National Bank Association, as Trustee of SW REMIC Trust 2015-1, Defendants.
• Court: U.S. District Court — District of Arizona

Douglas Sanders, Plaintiff, v. Joseph Tirello, ZBS Law, LLP, Selene Finance, U.S. National Bank Association,

as Trustee of SW REMIC Trust 2015-1, Defendants.

No. CV 19-470-TUC-CKJ

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

June 23, 2020

ORDER

Pending before the Court is the Motion to Dismiss Plaintiff's Complaint (Doc. 5) filed by U.S. Bank National Association, as Trustee of SW REMIC Trust 2015-1 ("US Bank").¹ Plaintiff Douglas Sanders ("Sanders") has filed a Response (Docs. 10, 15), U.S. Bank has filed a Reply (Doc. 11, 16), and Sanders has filed a sur-reply (Doc. 18). Also pending before the Court are the Motion for Extension of Time to File an Answer (Doc. 6) filed by Selene Finance ("Selene Finance"), Joseph Tirello ("Tirello"), and ZBS Law, LLP ("ZBS Law"), the Motion to File Last Page of Lawsuit (Doc. 17) filed by Sanders, and the Motion for Discovery (Doc. 32) filed by Sanders.

Additionally, Finance, Tirello, and ZBS Law have filed a Joinder to the Motion to Dismiss and its Reply (Doc 12). Similarly, Rushmore Loan Management Services, LLC ("Rushmore") has filed a Motion to Quash Service and Joinder to Motion to Dismiss(Doc. 22). Responses (Doc. 13, 23) and replies (Doc. 14, 25) have been filed.

I. Procedural History

Sanders filed a complaint on September 26, 2019, against Tirello, ZBS Law, Selene Finance, and U.S. Bank. The complaint alleges Sanders owns the property at 10613 S. Blackhawk Ridge Place, Vail, Arizona 85641 ("the Property" or "the Home"), and that others purport to have ownership of Sanders' mortgage note ("the Note") and/or the Deed of Trust ("the Deed"). The complaint further alleges ZBS Law is the corporation responsible for the damages inflicted as described in the complaint, Tirello is a participant in the imperfect securitization of the Note, Selene Finance is operating as a servicer, and US Bank is the master servicer for a securitzed trust and/or is a participant in the imperfect securization of the Note.

The complaint summarizes:

[Sanders], homeowner, disputes the title and ownership of the real property in question (the "Home"), which is the subject of this action, in that the originating mortgage lender, and others alleged to have ownership of [Sanders'] mortgage note and/or Deed of Trust, have unlawfully sold, assigned and/or transferred their ownership and security interest in a Promissory Note and Deed of Trust related to the Property, and, thus, do not have lawful ownership or a security interest in [Sanders'] Home . . .

Complaint, p. 3 (Doc. 1). Sanders alleges:

43. In order for the Trustee of the Securitized Trust to have a valid and enforceable secured claim against [Sanders's] Home, the Trustee must prove and certify to all parties that, among other things required under the [Pooling and Servicing Agreement ("PSA")]:

a. There was a complete and unbroken chain of endorsements and transfers of the Note from and to each party to the securitization transaction (which should be from the (A) Mortgage Originator to the (B) Sponsor to the (C) Depositor to the (D) Trust/Trustee, and that all of these endorsements and transfers were completed prior to the Turst closing dates . . . ; and

b. The Trustee of the Securitized Trust had the actual physical possession of the Note at that point in time, when all endorsements and assignments had been completed. Absent such proof, [Sanders] alleges that the Trust cannot demonstrate that it had perfected its security interest in Plaintiff's Home that is the subject of this action. Therefore, if the Defendants, and each of them, did not hold and possess the Note on or before the closing date of the Trust herein, they are estopped and precluded from asserting any secured or unsecured claim in this case.

Id. at 8-9. Sanders asserts none of the parties to the securitization transaction and none of the Defendants in this case hold a perfected and secured claim in the Property.

The complaint seeks to state the following claims for relief:²

Count I: Lack of Standing to Foreclose

Count II: Fraud in the Concealment

Count III: Fraud in the Inducement

Count IV: Intentional infliction of Emotional Distress

Count V: Slander of Title

Count VI: Quiet Title

Count VII: Declaratory Relief

Count VIII: Violations of TILA

Count IX: Violations of RESPA

Count X: Rescission

On October 17, 2019, US Bank, not in its Individual capacity but solely as Trustee of SW REMIC Trust 2015-1, filed a Motion to Dismiss Plaintiff's Complaint (Doc. 5). Additionally, attached to the Motion to Dismiss is a Request for Judicial Notice (Doc. 5-1). Sanders has filed a response (Docs. 10, 15) and US Bank has filed a reply (Docs. 11, 16). Sanders has filed a sur-reply (Doc. 18).³

Selene Finance, ZBS Law, and Tirello filed a Notice of Joinder in the motion and reply (Doc. 12). Sanders objects to this joinder (Doc. 13); Selene Finance, ZBS Law, and Tirello have responded to the objection (Doc. 14).

On December 23, 2019, Sanders filed a Motion for Admission of Last Page ofLawsuit (Doc. 17).

On January 22, 2020, Sanders filed a Notice of Joinder.⁴ This document states:

[Sanders] before this court by special appearance, and hereby notice to joinder, motion to joinder and add the above parties to this case before the court on record: . . . Rushmore Loan Management Services, LLC[.]

Notice of Joinder, p. 2 (Doc. 19). The Notice of Joinder includes Rushmore Loan Management Services, LLC ("Rushmore") in the caption. A February 21, 2020, Proof of Service (Doc. 20) states the original complaint (Doc. 1) and Sanders' Notice of Joinder (Doc. 19) were served on US Bank and Rushmore.

On March 19, 2020, Rushmore filed a Motion to Quash Service and Joinder to Motion to Dismiss (Doc. 22).

On June 10, 2020, Sanders filed a Motion for Discovery (Doc. 32).

II. Motion for Extension of Time to File an Answer (Doc. 6)

As Finance, Tirello, and ZBS Law have joined in the Motion to Dismiss (Doc. 12) the Court will deny this motion as moot. See Fed.R.Civ.P. 12(a)(4).

III. Motion to File Last Page of Lawsuit (Doc. 17)

Sanders seeks to add the last page of his complaint and a copy of a June 21, 2016, Notice of Trustee's Sale to his complaint. The Court will grant the request.

IV. Complaint and Plausibility Pleading Standard

A complaint is to contain a "short and plain statement of the claim showing that the pleader is entitled to relief[.]" Fed.R.Civ.P. 8(a). A complaint must set forth a set of facts that serves to put defendants on notice as to the nature and basis of the claim(s).The United States Supreme Court has found that a plaintiff must allege "enough facts to state a claim to relief that is plausible on its face." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). While a complaint need not plead "detailed factual allegations," the factual allegations it does include "must be enough to raise a right to relief above the speculative level." Id. at 555; see also Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011) ("If there are two alternative explanations, one advanced by defendant and the other advanced by plaintiff, both of which are plausible, plaintiff's complaint survives a motion to dismiss[.]"). Further, Fed.R.Civ.P. 8(a)(2) requires a showing that a plaintiff is entitled to relief "rather than a blanket assertion" of entitlement to relief. Twombley, 127 S.Ct. at 1965 n. 3. The complaint "must contain something more . . . than . . . a statement of facts that merely creates a suspicion [of] a legally cognizable right to action." Id. at 1965.

In considering a motion to dismiss, the Court considers a complaint in light of Twombly and must determine if a plaintiff has "nudge[d] [the] claims across the line from conceivable to plausible." Id. at 570. The Court also considers that the Supreme Court has cited Twombly for the traditional proposition that "[s]pecific facts are not necessary [for a pleading that satisfies Rule 8(a)(2)]; the statement need only 'give the defendant fair notice of what the . . . claim is and the grounds upon which it rests." Erickson v. Pardue, 551 U.S. 89, 93 (2007). Indeed, Twombly requires "a flexible 'plausibility standard,' which obliges a pleader to amplify a claim with some factual allegations in those contexts where such amplification is needed to render the claim plausible." Iqbal v. Hasty, 490 F.3d 143, 157-58 (2nd Cir. 2007); see also Moss v. U.S. Secret Service, 572 F.3d 962 (9th Cir. 2009) (for a complaint to survive a motion to dismiss, the non-conclusory "factual content," and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief).

When a court is considering a motion to dismiss, allegations that are mere conclusions are not entitled to the assumption of truth if unsupported by factual allegations that allow the court "to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 663-64 (2009). ThisCourt must take as true all allegations of material fact and construe them in the light most favorable to a plaintiff. See Cervantes v. United States, 330 F.3d 1186, 1187 (9th Cir. 2003). In general, a complaint is construed favorably to the pleader. See Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974), overruled on other grounds, 457 U.S. 800. Nonetheless, the Court does not accept as true unreasonable inferences or conclusory legal allegations cast in the form of factual allegations. Western Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). Furthermore, the Court is not to serve as an advocate of a pro se litigant, Noll v. Carlson, 809 F.2d 1446, 1448 (9th Cir. 1987), in attempting to decipher a complaint.

If a court determines that dismissal is appropriate, a plaintiff must be given at least one chance to amend a complaint when a more carefully drafted complaint might state a claim. Bank v. Pitt, 928 F.2d 1108, 1112 (11th Cir. 1991). Moreover, when dismissing with leave to amend, a court is to provide...