Tamburri v. Suntrust Mortg., Inc.

Citation875 F.Supp.2d 1009
Decision Date21 June 2012
Docket NumberNo. C–11–2899 EMC.,C–11–2899 EMC.
PartiesDeborah TAMBURRI, Plaintiff, v. SUNTRUST MORTGAGE, INC., et al., Defendants.
CourtUnited States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Eastern District of California

OPINION TEXT STARTS HERE

Nelson W. Goodell, San Francisco, CA, for Plaintiff.

Bryan M. Leifer, Donald Michael Scotten, Akerman Senterfitt LLP, Los Angeles, CA, for Defendants.

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS

EDWARD M. CHEN, District Judge.

Plaintiff Deborah Tamburri initiated this lawsuit in state court, asserting claims for, inter alia, violation of California Civil Code § 2923.5, violation of the Real Estate Settlement Procedures Act (“RESPA”), unfair business practices, and wrongful foreclosure. Defendant Suntrust Mortgage, Inc. removed the case to federal court, and the next day Ms. Tamburri moved for a temporary restraining order to enjoin the foreclosure sale of her home. This Court granted the motion and, after holding a hearing on June 28, 2010, granted a preliminary injunction enjoining Defendants from foreclosing on her home and requiring Plaintiff to post monthly bond payments. Docket No. 33. All Defendants besides Wells Fargo and Recontrust then moved to dismiss Plaintiff's complaint. Wells Fargo did not appear in this matter and default was entered against it on September 6, 2011. Docket No. 45. Plaintiff moved for default judgment against Wells Fargo, but the Court later granted Wells Fargo's motion to set aside default. Docket No. 82.

The Court previously granted in part and denied in part Defendants Suntrust, MERS, and U.S. Bank's motion to dismiss Plaintiff's First Amended Complaint. Docket No. 82; Tamburri v. Suntrust Mortg., Inc., C–11–2899 EMC, 2011 WL 6294472 (N.D.Cal. Dec. 15, 2011). Now pending before the Court is Defendants' (including Wells Fargo) motion to dismiss Plaintiff's Second Amended Complaint (“SAC”). Docket No. 95. The Court concludes, as explained below, that Plaintiff's only federal cause of action is deficient. However, the Court finds it appropriate to exercise supplemental jurisdiction over Plaintiff's remaining claims. Accordingly, the Court GRANTS Defendants' motion to dismiss Plaintiff's RESPA claim, and GRANTS in part and DENIES in part Defendants' motion with respect to Plaintiff's remaining state law claims.

I. DISCUSSION
A. Motion to Dismiss
1. Legal Standard

Under Federal Rule of Civil Procedure 12(b)(6), a party may move to dismiss based on the failure to state a claim upon which relief may be granted. SeeFed.R.Civ.P. 12(b)(6). A motion to dismiss based on Rule 12(b)(6) challenges the legal sufficiency of the claims alleged. See Parks Sch. of Bus. v. Symington, 51 F.3d 1480, 1484 (9th Cir.1995). In considering such a motion, a court must take all allegations of material fact as true and construe them in the light most favorable to the nonmoving party, although “conclusory allegations of law and unwarranted inferences are insufficient to avoid a Rule 12(b)(6) dismissal.” Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir.2009). While “a complaint need not contain detailed factual allegations ... it must plead ‘enough facts to state a claim to relief that is plausible on its face.’ Id. “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.” Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009); see also Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). “The plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than sheer possibility that a defendant acted unlawfully.” Id.

2. Real Estate Settlement Procedures Act (“RESPA”)12 U.S.C. § 2605

Ms. Tamburri alleges that Defendants SunTrust and Wells Fargo violated 12 U.S.C. § 2605(e) either by failing to properly respond to Plaintiff's Qualified Written Requests (“QWRs”) (in the case of Suntrust), or by denying it has an interest in the loan (in the case of Wells Fargo). SAC at 23–24.

As the Court explained in its prior order, Congress enacted RESPA in 1974 to protect home buyers from inflated prices in the home purchasing process.” Schuetz v. Banc One Mortg. Corp., 292 F.3d 1004, 1008 (9th Cir.2002). It sought to implement significant reforms in the real estate settlement process which “are needed to insure that consumers throughout the Nation are provided with greater and more timely information on the nature and costs of the settlement process.” 12 U.S.C. § 2601. RESPA applies not only to the actual settlement process, however, but also to the servicing of federally related mortgage loans. See, e.g., id. § 2605(e) (imposing requirements on servicers of federally related mortgage loans).

Section 2605(e) is titled [d]uty of loan servicer to respond to borrower inquiries.” It provides in relevant part as follows:

(1) Notice of receipt of inquiry

(A) In general. If any servicer of a federally related mortgage loan receives a qualified written request from

the borrower (or an agent of the borrower) for information relating to the servicing of such loan, the servicer shall provide a written response acknowledging receipt of the correspondence within 20 days ... unless the action requested is taken within such period.

(B) Qualified written request. For purposes of this subsection, a qualified written request shall be a written correspondence, other than notice on a payment coupon or other payment medium supplied by the servicer, that—

(i) includes, or otherwise enables the servicer to identify, the name and account of the borrower; and

(ii) includes a statement of the reasons for the belief of the borrower, to the extent applicable, that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.

12 U.S.C. § 2605(e). The terms “servicer” and “servicing” are defined in § 2605(i). “The term ‘servicer’ means the person responsible for servicing of a loan (including the person who makes or holds a loan if such person also services the loan).” Id. § 2605(i)(2). “The term ‘servicing’ means receiving any scheduled periodic payments from a borrower pursuant to the terms of any loan ... and making the payments of principal and interest and such other payments with respect to the amounts received from the borrower as may be required pursuant to the terms of the loan.” Id. § 2605(i)(3).

Under § 2605(e), a loan servicer has an obligation to act when it receives a QWR from the borrower or borrower's agent “for information relating to the servicing of [the] loan.” 12 U.S.C. § 2605(e)(1)(A). Because RESPA does not provide for injunctive relief, see Rivera v. BAC Home Loans Serv., L.P., No. C 10–02439 RS, 2010 WL 2757041, at *4–5, 2010 U.S. Dist. LEXIS 80294, at *12–13 (N.D.Cal. Jul. 9, 2010) (concluding that RESPA claims could not stop a foreclosure because RESPA did not have as a remedy injunctive relief), actual damages and, in the case of a pattern or practice, statutory damages, are the only remedies available when a servicer violates the above provisions. See12 U.S.C. § 2605(f)(1).

Plaintiff alleges she sent the following QWRs to Defendants:

(1) On November 25, 2009, seven months after receiving a Notice of Default, Plaintiff sent a QWR to SunTrust “in an attempt to gather additional information regarding her loan.” SAC ¶ 50. SunTrust did not respond until 27 days later, and its response referenced the wrong borrower's loan. Id. ¶¶ 50–51; see Docket No. 11, Ex. 4 (letter from SunTrust).

(2) On February 9, 2010, Plaintiff sent a QWR to Wells Fargo. Wells Fargo responded by stating that it was [u]nable to confirm name(s) provided as an active borrower,” nor was it able to “verify active mortgage on property address or loan number supplied.” SAC ¶ 58.

(3) On March 10, 2011, after receiving a Notice of Trustee's Sale, Plaintiff sent QWRs to SunTrust, MERS, and U.S. Bank.1 SAC ¶ 69. MERS and U.S. Bank never responded. Id. ¶ 70. SunTrust responded that Wells Fargo owned Plaintiff's loan, and that SunTrust was the servicer on the loan. Id.; Docket No. 11, Ex. 8 (letter from SunTrust). However, U.S. Bank was listed as the owner/beneficiary on the recorded assignment in the County Recorder's Office. When Plaintiff contacted U.S. Bank by telephone, U.S. Bank denied owning her loan. SAC ¶ 70.

The Court previously dismissed Plaintiff's RESPA claim as alleged in the First Amended Complaint for failure to allege damages. Defendants, as they argued previously, contend that Plaintiff's claim as alleged in the SAC should be dismissed for the same reasons. First, they argue that Plaintiff's SAC still fails to allege any damages as a result of Defendants' purported RESPA violations. Second, Defendants again claim that Plaintiff's letters are not QWRs because they do not relate to the servicing of the loan as required under § 2605; rather, they merely ask for documentation as to who owns the loan.

Although Plaintiff has added new allegations of harm to her RESPA claim, the Court finds that Plaintiff has still not alleged any actual, cognizable damages resulting from Defendants' failure to respond to QWRs. As the Court previously explained, Plaintiff's “statement that she was harmed by not knowing the true owner of Note and ‘whether her payments have been properly applied,’ FAC ¶ 47, is insufficient to allege the pecuniary harm required by the statute.” Docket No. 82 at 12; Tamburri, 2011 WL 6294472 at *8;Lal v. American Home Servicing, Inc., 680 F.Supp.2d 1218, 1223 (E.D.Cal.2010) ([T]he Court rejects, as a matter of law, Plaintiffs' argument that they were harmed by not being able to name the real party of interest in this suit. Under RESPA, a borrower may not recover actual damages for nonpecuniary losses.”); Ash v. OneWest Bank, FSB, 2:09–CV–00974FCD/DAD, 2010 WL 375744, at *6 (E.D.Cal. Jan. 26, 2010) ([P]laintiffs' vague claim that they suffered harm...

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