Singh v. Litton Loan Servicing Lp

• Decision Date: 28 April 2011
• Docket Number: Doc. 30.,CASE NO. CV F 10-1355 LJO GSA
• Court: U.S. District Court — Eastern District of California
• Parties: JOHN SINGH, Plaintiff, v. LITTON LOAN SERVICING LP, et al., Defendants.

JOHN SINGH, Plaintiff,

v.LITTON LOAN SERVICING LP, et al., Defendants.

CASE NO. CV F 10-1355 LJO GSA

Doc. 30.

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA

Dated: April 28, 2011

ORDER ON LITTON LOAN SERVICING'S

MOTION TO DISMISS REMANDED CLAIMS

INTRODUCTION

Defendant Litton Loan Servicing LP ("Litton") seeks to dismiss plaintiff John Singh's ("Mr. Singh's") claims remanded from multidistrict litigation regarding his defaulted home loan. This Court considered Litton's F.R.Civ.P. 12(b)(6) motion to dismiss on the record and VACATES the May 25, 2011 hearing, pursuant to Local Rule 230(g). For the reasons discussed below, this Court DISMISSES Mr. Singh's remanded claims.

BACKGROUND¹

Summary

Generally, the complaint alleges that Mr. Singh was placed in an improper loan which he could not afford for his Fresno residence ("property"). This action was included in a multidistrict proceedingin the Arizona district court, which remanded to this Court certain claims. Litton attacks the remanded claims as improperly pled and legally barred.

Mr. Singh's Loan

On June 14, 2006, Mr. Singh obtained a $419,097.41 property loan secured by a deed of trust on the property. Mr. Singh defaulted on the loan, and foreclosure proceedings have been initiated.

Mr. Singh's Remanded Claims

The complaint alleges that the "loan was neither proper nor suitable for Plaintiff's condition and station in life" and "exceeded the reasonable expected value of the property." In addition to Litton, the complaint names MERSCORP, Inc. and Mortgage Electronic Registration Systems, Inc. ("MERS") as defendants and fails to distinguish alleged wrongdoing among the three named defendants.² The complaint includes six remanded claims ("remanded claims") which allege federal and California statutory and common law claims and which will be addressed in greater detail below. The complaint seeks to enjoin or rescind foreclosure and eviction proceedings, to prevent defendants to transfer the property, and to declare the foreclosure trustee sale void. The complaints seeks to recover damages and for Mr. Singh's emotional distress.

DISCUSSION

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

Litton attacks the remanded claims as "cursory and unsupported" for failure to "allege a single act of wrongdoing on the part of Litton" and "what, if any, injury plaintiff has suffered on account of Litton's alleged conduct." Litton points to the absence of "a single substantive allegation regarding Litton's alleged involvement in the alleged wrongdoing" which is chiefly directed at loan origination in which Litton did not participate.

"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 (9th Cir. 1987); see Wong v. Bell, 642 F.2d 359, 361-362 (9th 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 (9th 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 (9th 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. Pacifca Police Dept., 901 F.2d 696, 699 (9th Cir. 1990); Graehling v. Village of Lombard, III., 58 F.3d 295, 297 (7th 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 (9th 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 (9th 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 (9th 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 toplaintiff, 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 (7th 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 (9th 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 (9th Cir. 1980); see Avco Corp. v. Precision Air Parts, Inc., 676 F.2d 494, 495 (11th 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 (6th 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 (9th 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 to the 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,...