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Bernabe v. Ditech Financial LLC

United States District Court, D. Nevada

February 27, 2017




         Pending before the Court is the Motion to Dismiss, (ECF No. 6), filed by Defendant Ditech Financial LLC (“Defendant”). Pro se Plaintiffs Carlito Bernabe and Clara Bernabe (collectively “Plaintiffs”)[1] filed a Response, (ECF No. 9), and Defendant filed a Reply, (ECF No. 10). For the reasons discussed below, the Court GRANTS Defendant's Motion to Dismiss.

         I. BACKGROUND

         This case arises from alleged violations of the Federal Debt Collections Practices Act (the “FDCPA”). See 15 U.S.C. § 1692. Plaintiffs allege that Defendant violated the FDCPA in its “continued attempts to collect an alleged debt [D]efendant claims is owed” but that “Plaintiffs are without knowledge of the alleged debt.” (Compl. ¶ 5, ECF No. 1).

         Defendant sent Plaintiff a notice (the “Notice” or “Notices”) in February 2016, stating in bold font: “THIS IS NOT A BILL. THIS STATEMENT IS FOR INFORMATIONAL PURPOSES ONLY.” (the “warning”). (Ex. A to Compl. at 16). In response to this Notice, Plaintiffs sent Defendant a Notice of Validation of Debt asking Defendant to validate or verify their debt pursuant to the FDCPA. (Id. ¶ 7). Defendant responded with the Deed of Trust (the “Deed”) from the lender Homecomings Financial Network, Inc. (“Homecomings”). (Id. ¶ 8). Plaintiffs point out that “[a]bsolutely nowhere [on the Deed] is the name [of Defendant], nor is there any documents [sic] with the name [of Defendant]. There is absolutely zero documentation that proves a debt with [Defendant], nor any contract with [Defendant] what so ever [sic].” (Id.). Plaintiffs contend that Defendant has committed “deceptive and illegal acts in their attempt to collect the alleged debt.” (Id. ¶ 12).

         Based on these allegations, Plaintiff's Complaint asserts that Defendant violated 15 U.S.C. §§ 1692g, 1692e(11), 1692d, 1692f, and 1692e(2). (See generally id.).

         Defendant filed the instant Motion because “Plaintiffs' pleadings fail to satisfy the requirement of Fed.R.Civ.P. 12(b)(6).” (Mot. to Dismiss (“MTD”) 1:27-28, ECF No. 6). Specifically, Defendant asserts that “none of the correspondence [with Plaintiff] was made in connection with the collection of a debt.” (Id. 5:5-6). Defendant seeks the Complaint to be dismissed with prejudice because “the Court already has before it all of the documents upon which Plaintiffs rely to allege violations of the FDCPA.” (Id. 8:3-5).


         Dismissal is appropriate under Rule 12(b)(6) where a pleader fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). A pleading must give fair notice of a legally cognizable claim and the grounds on which it rests, and although a court must take all factual allegations as true, legal conclusions couched as a factual allegations are insufficient. Twombly, 550 U.S. at 555. Accordingly, Rule 12(b)(6) requires “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). “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.” Id. This standard “asks for more than a sheer possibility that a defendant has acted unlawfully.” Id.

         “Generally, a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion . . . . However, material which is properly submitted as part of the complaint may be considered on a motion to dismiss.” Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555 n.19 (9th Cir. 1990). Similarly, “documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the pleading, may be considered in ruling on a Rule 12(b)(6) motion to dismiss” without converting the motion to dismiss into a motion for summary judgment. Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994). Otherwise, if the district court considers materials outside of the pleadings, the motion to dismiss is converted into a motion for summary judgment. See Fed. R. Civ. P. 12(d); Arpin v. Santa Clara Valley Transp. Agency, 261 F.3d 912, 925 (9th Cir. 2001).

         If the Court grants a motion to dismiss for failure to state a claim, leave to amend should be granted unless it is clear that the deficiencies of the complaint cannot be cured by amendment. DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. 1992). Pursuant to Rule 15(a), the court should “freely” give leave to amend “when justice so requires, ” and in the absence of a reason such as “undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of the amendment, etc.” Foman v. Davis, 371 U.S. 178, 182 (1962).


         Plaintiffs allege that Defendant committed three violations of 15 U.S.C. § 1692, the Fair Debt Collection Practices Act (“FDCPA”): (1) Defendant failed to properly validate the debt pursuant to § 1692g; (2) Defendant failed to include the proper language on its correspondence to Plaintiffs pursuant to § 1692e(11); and (3) Defendant's correspondence was harassing, oppressive, abusive, unfair, and misleading pursuant to §§ 1692d, 1692f, and 1692e(2). (Compl. ¶ 18).

         “The FDCPA imposes liability only when an entity is attempting to collect debt. For the purposes of the FDCPA, the word ‘debt' is synonymous with ‘money.' Thus, [a defendant] would only be liable if it attempted to collect money from [the plaintiff].” Ho v. ReconTrust Co., NA, 840 F.3d 618, 621 (9th Cir. 2016) (emphasis added). That is not the case here. All of Plaintiffs' allegations are premised on Defendant's Notices sent to Plaintiffs that made “numerous claims by [D]efendant regarding an alleged loan.” (Compl. ¶ 6). However, the ...

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