United States District Court, D. Nevada
C. Jones United States District Judge
case arises from a residential foreclosure by Defendant Eagle
Canyon Association (“HOA”) due to the
homeowner's failure to pay HOA assessments. Pending
before the Court is the HOA's Motion to Dismiss. (ECF No.
16.) For the reasons given herein, the Court denies the
FACTS AND PROCEDURAL BACKGROUND
December 2002, non-party homeowners obtained title to
property located at 840 Alena Way, Sparks, Nevada 89436 (the
“Property”), by way of a grant deed. (Compl.
¶ 14, ECF No. 1.) In December 2004, the homeowners
executed a promissory note (“Note”) and deed of
trust (“DOT”) in the amount of $232, 000 in favor
of First Source Financial USA. (Id. at ¶ 15.)
The Note and DOT were subsequently assigned to Plaintiff HSBC
Bank USA (“HSBC”). (Id. at ¶ 16.)
Then, in May 2012, Defendant Red Rock Financial Services, LLC
(“Red Rock”), on behalf of the HOA, recorded a
Lien for Delinquent Assessments in the amount of $947.15,
based on the homeowners' failure to pay their HOA
assessments. The HOA eventually foreclosed, selling the
Property to Defendant Thunder Properties
(“Thunder”) on August 7, 2013, for the price of
$3, 515. (Id. at ¶¶ 17-21.)
August 5, 2016, HSBC brought this action against Thunder, the
HOA, and Red Rock, asserting six causes of action arising
from the HOA foreclosure sale: (1) violation of the Takings
Clause of the Fifth Amendment; (2) violation of the Due
Process Clauses of the Fifth and Fourteenth Amendments; (3)
wrongful foreclosure; (4) violation of NRS 116.1113 et
seq.; (5) unjust enrichment; and (6) quiet title. HSBC
primarily seeks an order declaring that the foreclosure sale
did not extinguish its first deed of trust, or that the sale
was unlawful and invalid and should be set aside entirely.
The HOA now moves to dismiss the claims of wrongful
foreclosure, violation of NRS 116.1113, and quiet title based
on (1) HSBC's failure to mediate its claims under NRS
38.310, and (2) the fact that the HOA does not claim a
current interest in the Property. (Mot. Dismiss, ECF No. 16.)
Red Rock joins the HOA's motion, and argues for dismissal
of the same claims on the same grounds. (Joinder Mot.
Dismiss, ECF No. 18.)
Rule of Civil Procedure 8(a)(2) requires only “a short
and plain statement of the claim showing that the pleader is
entitled to relief” in order to “give the
defendant fair notice of what the ... claim is and the
grounds upon which it rests.” Conley v.
Gibson, 355 U.S. 41, 47 (1957). Federal Rule of Civil
Procedure 12(b)(6) mandates that a court dismiss a cause of
action that fails to state a claim upon which relief can be
granted. When considering a motion to dismiss under Rule
12(b)(6) for failure to state a claim, dismissal is
appropriate only when the complaint does not give the
defendant fair notice of a legally cognizable claim and the
grounds on which it rests. See Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). In considering
whether the complaint is sufficient to state a claim, the
court will take all material allegations as true and construe
them in the light most favorable to the plaintiff. See NL
Indus., Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir.
1986). The court, however, is not required to accept as true
allegations that are merely conclusory, unwarranted
deductions of fact, or unreasonable inferences. See
Sprewell v. Golden State Warriors, 266 F.3d 979, 988
(9th Cir. 2001).
formulaic recitation of a cause of action with conclusory
allegations is not sufficient; a plaintiff must plead facts
pertaining to his own case making a violation
“plausible, ” not just “possible.”
Ashcroft v. Iqbal, 556 U.S. 662, 677-79 (2009)
(citing Twombly, 550 U.S. at 556) (“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.”). That is, a plaintiff must not only specify
or imply a cognizable legal theory, but also must allege the
facts of the plaintiff's case so that the court can
determine whether the plaintiff has any basis for relief
under the legal theory the plaintiff has specified or
implied, assuming the facts are as the plaintiff alleges
the pleadings are closed-but early enough not to delay
trial-a party may move for judgment on the pleadings.”
Fed.R.Civ.P. 12(c). The standards governing a Rule 12(c)
motion are the same as those governing a Rule 12(b)(6)
motion. See Dworkin v. Hustler Magazine, Inc., 867
F.2d 1188, 1192 (9th Cir. 1989) (“The principal
difference ... is the time of filing. ... [T]he motions are
functionally identical ....”).
defendant may challenge the court's subject-matter
jurisdiction over a case or certain claims pursuant to
Federal Rule of Civil Procedure 12(b)(1). The plaintiff, as
the party seeking to invoke the court's jurisdiction,
bears the burden of proving that the case is properly in
federal court. Wright v. Incline Vill. Gen. Imp.
Dist., 597 F.Supp.2d 1191, 1198 (D. Nev. 2009) (citing
McCauley v. Ford Motor Co., 264 F.3d 952, 957 (9th
Cir. 2001)). A challenge to subject-matter jurisdiction may
be either facial or factual. Thornhill Publ'g Co. v.
Gen. Tel. & Elec. Corp., 594 F.2d 730, 733 (9th Cir.
facial challenge asserts that the allegations contained in
the complaint “are insufficient on their face to invoke
federal jurisdiction.” Safe Air for Everyone v.
Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). To determine
whether the facts are sufficient to establish subject-matter
jurisdiction, the court must “consider the allegations
of the complaint to be true and construe them in the light
most favorable to the plaintiff.” Nevada ex rel.
Colo. River Comm'n of Nev. v. Pioneer Cos., 245
F.Supp.2d 1120, 1124 (D. Nev. 2003) (citing Love v.
United States, 915 F.2d 1242, 1245 (9th Cir. 1989)).
Failure to Mediate
argues that the claims of wrongful foreclosure and violation
of NRS 116.1113 must be dismissed because HSBC failed to
mediate its claims under ...