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Argo Nevada, LLC v. Quality Loan Service Corporation

United States District Court, D. Nevada

February 27, 2017

ARGO NEVADA, LLC, a Nevada limited liability company, Plaintiff,
v.
QUALITY LOAN SERVICE CORPORATION, a foreign corporation doing business in Nevada; WELLS FARGO BANK, NA; DOES 1-5, inclusive; and ROE Business Entities 6-10, inclusive, Defendants.

          SNELL & WILMER, Jennifer L. McBee Amy F. Sorenson Q., Robin E. Perkins, Jennifer L. McBee, Howard Hughes Parkway, Attorneys for Defendant Wells Fargo Bank, N.A.

          LAW OFFICES OF MONT E. TANNER, Mont E. Tanner Mont E. Tanner, Attorneyfor Plaintiff Argo Nevada, LLC

          MCCARTHY AND HOLTHUS, Thomas N. Beckom Attorneys for Defendant Quality Loan Service Corporation

          JOINT MOTION TO STAY DISCOVERY PENDING DETERMINATION OF WELLS FARGO'S MOTION TO DISMISS PLAINTIFF'S COMPLAINT

         Defendants Wells Fargo Bank ("Wells Fargo") and Quality Loan Service Corporation ("Quality Loan, " and together with Wells Fargo, the "Defendants"), and Plaintiff Argo Nevada, LLC ("Plaintiff, " and collectively with Defendants, the "Parties"), by and through their respective counsel, hereby jointly move this Court for an order staying discovery pending resolution of Wells Fargo's Motion to Dismiss Plaintiffs Complaint.

         This Joint Motion is based upon the following Memorandum of Points and Authorities, all papers filed with the Court, any documents incorporated by reference or subject to judicial notice, and any oral argument this Court may entertain.

         MEMORANDUM OF POINTS AND AUTHORITIES

         Wells Fargo filed a Motion to Dismiss Plaintiffs Complaint (the "Motion") under Federal Rule of Civil Procedure 12(b)(6). (ECF No. 9.) The Parties respectfully request that this Court stay discovery while the Motion is pending. This is the first request for a stay of discovery in this matter.

         A. The Pending Motion to Dismiss Is Potentially Dispositive of the Entire Case and Can Be Decided Without Additional Discovery.

         While the standard to justify a stay is demanding, this case amply satisfies it. In deciding whether to stay discovery, the Court weighs the expense of discovery against "the underlying principle that a stay of discovery should only be ordered if the court is 'convinced' that a plaintiff will be unable to state a claim for relief." Tradebay, LLC v. eBay, Inc., 278 F.R.D. 597, 603 (D. Nev. 2011). The Court also considers whether the pending motion is potentially dispositive of the entire case and whether that motion can be decided without additional discovery. Solida v. U.S. Dep't of Fish & Wildlife, 288 F.R.D. 500, 506 (D. Nev. 2013).

         The Parties agree that Wells Fargo's Motion warrants a stay under each consideration., First, Wells Fargo's Motion seeks dismissal with prejudice of the action in its entirety. Second, the bases for the Motion are that (1) Plaintiffs claims for violation of NRS 107.080 and NRS 107.087 fail based on the plain language of the statute and the publicly recorded documents; (2) Plaintiffs unjust enrichment claim fails as it is not ripe; and (3) Plaintiffs declaratory relief fails because his substantive claims fail. (ECF No. 9.) If this Court agrees, this case must be dismissed in its entirety in Defendants' favor. As Wells Fargo's Motion is based solely on purely legal arguments and recorded documents - of which this Court may take judicial notice - the Motion also may be decided without discovery. A discovery stay in this case is therefore justified.

         Finally, while Wells Fargo's Motion is pending, Plaintiffs ability to conduct discovery is prejudiced because discovery cannot be customized to Defendants' answers. It is therefore likely that discovery would need to be extended, or that discovery already conducted would need to be reopened or supplemented after Defendants file an answer. The Parties agree that if discovery proceeds while the Motion is pending, it will be difficult to accomplish a "just, speedy and inexpensive determination" of the matter under Federal Rule of Civil Procedure 1. Discovery for all Parties will be longer, more expensive, and less efficient.

         B. The Arguments on the Merits in Wells Fargo's Motion to Dismiss Independently Justify a Stay of Discovery.

         The Court also weighs the expense of discovery against "the underlying principle that a stay of discovery should only be ordered if the court is 'convinced' that a plaintiff will be unable to state a claim for relief."[1] Tradebay, LLC v. eBay, Inc., 278 F.R.D. 597, 603 (D. Nev. 2011). Courts have embraced the approach and analysis set forth in TradeBay. Money v. Banner Health, Civil No. 3:11-cv-00800-LRH-WGC, 2012 U.S. Dist. LEXIS 49922, at *16 (D. Nev. Apr. 9, 2012) (citing Tradebay, LLC v. eBay, Inc., 278 F.R.D. 597, 603 (D. Nev. 2011)). Arriving at this determination "often requires a magistrate judge to take a 'preliminary peek' at the motion that is pending before the district judge." Chartis Specialty Ins. v. Gemstone LVS, LLC, 2:11-cv-1669-MMD-CWH, 2012 U.S. Dist. LEXIS 111852, at *6 (D. Nev. Aug. 8, 2012).

         A "preliminary peek" here shows that Plaintiff cannot maintain its action as a matter of law. First, Plaintiffs allegation that Wells Fargo violated NRS 107.080 fails based on the plain language of the statute and a cursory look at the publicly-recorded documents relating to the property at issue in this case. Wells Fargo gave statutorily proper notice of the pending foreclosure sale. Specifically, the statute requires that the notice of sale and notice of default be sent to the "grantor or to the person who holds the title of record." NRS 107.080(3) (emphasis added). Plaintiff does not allege that Wells Fargo failed to provide notice of default or notice of -sale to the grantor; thus, this claim fails. Second, Plaintiffs unjust enrichment claim fails as a matter of law because it is not ripe; indeed, Wells Fargo has not retained a benefit that belonged to Plaintiff. Third, Plaintiff cannot obtain declaratory relief where the ...


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