United States District Court, D. Nevada
before the court is defendant Maplewood Springs
Homeowners' Association's (the "HOA")
renewed motion to dismiss. (ECF No. 75).
Plaintiff/counterdefendant Nationstar Mortgage, LLC
("Nationstar") filed a response (ECF No. 84), as
did defendant/counterclaimant SFR Investments Pool 1, LLC
("SFR") (ECF No. 78), to which the HOA replied (ECF
Nos. 82; 91).
before the court is Deutsche Bank National Trust Company, as
trustee for holders of the GSAA home equity trust 2006-11
asset backed certificates series 2006-11
("Deutsche") and Nationstar's renewed motion
for summary judgment. (ECF No. 70). The HOA and SFR filed
responses (ECF Nos. 79, 87), to which Deutsche and Nationstar
replied (ECF No. 89).
before the court is SFR's renewed motion for summary
judgment. (ECF No. 71). Deutsche and Nationstar filed a
response, (ECF No. 83), to which SFR replied (ECF No. 93).
before the court is the HOA's renewed motion for summary
judgment (ECF No. 73). No responses were filed and the time
to respond has since passed.
present case involves a dispute over real property located at
6229 Sugartree Avenue, Las Vegas, Nevada (the
"property"). (ECF No. 1 at 2). Gholam H. Farzad
(the "borrower") purchased the property on April
13, 2006. (ECF No. 1 at 3). The borrower financed the
purchase with a $297, 800.00 loan that was secured by a deed
of trust dated April 13, 2006, and recorded on April 24,
2006. (ECF No. 1-1 at 2-18).
October 10, 2012, the deed of trust was assigned to Deutsche,
via an assignment of deed of trust. (ECF No. 1-2).
February 7, 2013, Nevada Association Services, Inc.
("NAS"), as the HOA's trustee, recorded a
notice of delinquent assessment lien. (ECF No. 1-5). The
notice asserted that the borrower owed $1, 409.08 in fees.
(ECF No. 1-5 at 2).
August 9, 2013, NAS, as the HOA's trustee, recorded a
notice of default and election to sell to satisfy the
delinquent assessment lien. (ECF No. 1-6). The notice
asserted that the borrower owed $2, 632.74 in fees. (ECF No.
1-6 at 2). On the same day as it was recorded, NAS mailed the
notice of default and election to sell (via certified mail,
return receipt requested) to the borrower, Bank of New York
Mellon, Deutsche Bank National Trust, Countrywide Home Loans,
Inc., and Mortgage Electronic Registration Services
("MERS"). (ECF Nos. 40 at 2; 40-2 at 4-5).
October 1, 2013, Nationstar's interest in the deed of
trust was recorded. (ECF No. 1- 3).
January 31, 2014, the HOA recorded a notice of trustee's
sale through its agent. (ECF No. 1-7). The notice asserted
that the borrower owed $4, 106.60 in fees and that the
trustee's sale would occur on February 21, 2014. (ECF No.
1-7 at 3). On the same day as it was recorded, NAS mailed the
notice of trustee's sale (via certified mail, return
receipt requested) to the borrower, Bank of New York Mellon
("BNYM"), Deutsche, Countrywide Home Loans, Inc.,
and Mortgage Electronic Registration Services
("MERS"). (ECF Nos. 40 at 2; 40-3 at 4-7).
held the trustee's sale on April 4, 2014, at which SFR
purchased the property for $16, 000.00. (ECF No. 70-8 at 2).
The foreclosure deed was recorded on April 7, 2014. (ECF No.
filed the original complaint on August 31, 2015, asserting
four claims against the HOA and SFR: (1) declaratory
relief/quiet title; (2) breach of Nevada Revised Statute
("NRS") 16.1113 against the HOA; (3) injunctive
relief against SFR; and (4) violation of procedural due
process. (ECF No. 1). Nationstar contends that the notices
prior to the HOA's foreclosure sale violated NRS Chapter
116, that the HOA violated NRS 116.1113 by falsely promising
its liens were subordinate to the senior deed of trust and
thereafter failing to notify Nationstar that its security
interest was at risk, that the sale should be set aside as it
was commercially unreasonable, and that Nevada's
statutory scheme providing superpriority liens to
homeowner's associations is violative of procedural due
process under the Constitution. (ECF No. 1).
November 6, 2015, SFR filed an answer and counterclaim
asserting three claims of relief against Nationstar,
Deutsche, BNYM, and the borrower: (1) declaratory
relief/quiet title; (2) preliminary and permanent injunction;
and (3) slander of title. (ECF No. 18).
Motion to dismiss
court may dismiss a plaintiffs complaint for "failure to
state a claim upon which relief can be granted."
Fed.R.Civ.P. 12(b)(6). A properly pled complaint must provide
"[a] short and plain statement of the claim showing that
the pleader is entitled to relief." Fed.R.Civ.P.
8(a)(2). Although Rule 8 does not require detailed factual
allegations, it does require more than labels and
conclusions. Bell Atl. Corp. v. Twombly, 550 U.S.
544, 555 (2007). Furthermore, a formulaic recitation of the
elements of a cause of action will not suffice. Ashcroft
v. Iqbal, 556 U.S. 662, 677 (2009) (citation omitted).
Rule 8 does not unlock the doors of discovery for a plaintiff
armed with nothing more than conclusions. Id. at
survive a motion to dismiss, a complaint must contain
sufficient factual matter 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.
Id. When a complaint pleads facts that are merely
consistent with a defendant's liability, and shows only a
mere possibility of entitlement, the complaint does not meet
the requirements to show plausibility of entitlement to
Iqbal, the Supreme Court clarified the two-step
approach district courts are to apply when considering a
motion to dismiss. Id. First, the court must accept
as true all of the allegations contained in a complaint.
Id. However, this requirement is inapplicable to
legal conclusions. Id. Second, only a complaint that
states a plausible claim for relief survives a motion to
dismiss. Id. at 678. Where the complaint does not
permit the court to infer more than the mere possibility of
misconduct, the complaint has "alleged - but not shown -
that the pleader is entitled to relief." Id. at
679. When the allegations in a complaint have not crossed the
line from conceivable to plausible, plaintiffs claim must be
dismissed. Twombly, 550 U.S. at 570.
Ninth Circuit addressed post-Iqbal pleading
standards in Starr v. Baca, 652 F.3d 1202, 1216 (9th
Cir. 2011). The Starr court held:
First, to be entitled to the presumption of truth,
allegations in a complaint or counterclaim may not simply
recite the elements of a cause of action, but must contain
sufficient allegations of underlying facts to give fair
notice and to enable the opposing party to defend itself
effectively. Second, the factual allegations that are taken
as true must plausibly suggest an entitlement to relief, such
that it is not unfair to require the opposing party to be
subjected to the expense of discovery and continued
Motion for summary judgment
Federal Rules of Civil Procedure allow summary judgment when
the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any,
show that "there is no genuine dispute as to any
material fact and the movant is entitled to a judgment as a
matter of law." Fed.R.Civ.P. 56(a). A principal purpose
of summary judgment is "to isolate and dispose of
factually unsupported claims." Celotex Corp. v.
Catrett, 477 U.S. 317, 323-24 (1986).
purposes of summary judgment, disputed factual issues should
be construed in favor of the non-moving party. Lujan v.
Nat'l Wildlife Fed., 497 U.S. 871, 888 (1990).
However, to be entitled to a denial of summary judgment, the
nonmoving party must "set forth specific facts showing
that there is a genuine issue for trial." Id.
determining summary judgment, a court applies a
burden-shifting analysis. The moving party must first satisfy
its initial burden. "When the party moving for summary
judgment would bear the burden of proof at trial, it must
come forward with evidence which would entitle it to a
directed verdict if the evidence went uncontroverted at
trial. In such a case, the moving party has the initial
burden of establishing the absence of a genuine issue of fact
on each issue material to its case." C.A.R. Tramp.
Brokerage Co. v. DardenRests., Inc., 213 F.3d 474, 480
(9th Cir. 2000) (citations omitted).
contrast, when the nonmoving party bears the burden of
proving the claim or defense, the moving party can meet its
burden in two ways: (1) by presenting evidence to negate an
essential element of the non-moving party's case; or (2)
by demonstrating that the non-moving party failed to make a
showing sufficient to establish an element essential to that
party's case on which that party will bear the burden of
proof at trial. See Celotex Corp., 477 U.S. at
323-24. If the moving party fails to meet its initial burden,
summary judgment must be denied and the court need not
consider the nonmoving party's evidence. See Adickes
v. S.H. Kress & Co., 398 U.S. 144, 159- 60 (1970).
moving party satisfies its initial burden, the burden then
shifts to the opposing party to establish that a genuine
issue of material fact exists. See Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586
(1986). To establish the existence of a factual dispute, the
opposing party need not establish a material issue of fact
conclusively in its favor. It is sufficient that "the
claimed factual dispute be shown to require a jury or judge
to resolve the parties' differing versions of the truth
at trial." T. W. Elec. Serv., Inc. v. Pac. Elec.
Contractors Ass 'n, 809 F.2d 626, 631 (9th Cir.
other words, the nonmoving party cannot avoid summary
judgment by relying solely on conclusory allegations that are
unsupported by factual data. See Taylor v. List, 880
F.2d 1040, 1045 (9th Cir. 1989). Instead, the opposition must
go beyond the assertions and allegations of the pleadings and
set forth specific facts by producing competent evidence that
shows a genuine issue for trial. See Celotex, 411
U.S. at 324.
summary judgment, a court's function is not to weigh the
evidence and determine the truth, but to determine whether
there is a genuine issue for trial. See Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 249 (1986).
Nonmovant's evidence is "to be believed, and all
justifiable inferences are to be drawn in his favor."
Id. at 255. But if the evidence of the nonmoving
party is merely colorable or is not significantly probative,
summary judgment may be granted. See Id. at 249-50.
seeks to dismiss Nationstar's claims and argues: (1) that
Nationstar does not have an adverse interest in the property
to sustain a claim of declaratory relief/quiet title; (2)
that NRS 38.310 bars claims based on covenants, conditions
and restrictions ("CC&Rs") that have not first
been mediated; and (3) that NRS 116.31162-31168's notice
provisions satisfy due process. (ECF No. 75 at 2).
Motion to dismiss
this court turns to Nationstar's cause of action for
injunctive relief. (ECF No. 1 at 8-9). Though the parties
omit argument for dismissing this cause of action in the
briefing, the court finds no sustainable cause of action for
injunctive relief. In fact, injunctive relief is a remedy,
not a cause of action. See, e.g., Ajetunmobi v. Clarion
Mortg. Capital, Inc., 595 Fed.Appx. 680, 684 (9th Cir.
2014) (citation omitted). If Nationstar still seeks this
remedy, it would properly be brought as a motion under
Federal Rule of Civil Procedure 65. Therefore, the court will
dismiss Nationstar's claim for injunctive relief.
local rules have the force of law. See United States v.
Hvass, 355 U.S. 570, 574-575 (1958). Under Local Rule
7-2(d), "[t]he failure of an opposing party to file
points and authorities in response to any motion . . .
constitutes a consent to the granting of the motion."
The Ninth Circuit instructs that a district court must weigh
several factors before granting a motion filed pursuant to
Federal Rule of Civil Procedure 12 because a party failed to
comply with a local rule: "(1) the public's interest
in expeditious resolution of litigation; (2) the court's
need to manage its docket; (3) the risk of prejudice to the
defendants; (4) the public policy favoring disposition of
cases o[n] their merits; and (5) the availability of less
drastic sanctions." Ghazali v. Moron, 46 F.3d
52, 53 (9th Cir. 1995) (quoting Henderson v. Duncan,
779 F.2d 1421, 1423 (9th Cir. 1986)) (discussing a Nevada
local rule construing a failure to oppose a motion as
effectively consenting to the granting of that motion);
see also Martinez v. Stanford, 323 F.3d 1178, 1183
(9th Cir. 2003) (indicating that Ghazali provides
the applicable rule for evaluating a Rule 12 motion to
dismiss in light of a local rule authorizing dismissal).
Nationstar and Deutsche failed to timely respond in
accordance with Local Rule 7-2. See (ECF No. 72,
HOA's Motion to Dismiss) (filed on August 26, 2016;
responses due by September 12, 2016); see also (ECF
No. 84; Nationstar and Deutsche's responses) (filed on
September 19, 2016). However, this court finds that the
public policy favoring disposition of cases on their merits
outweighs any prejudice to SFR. See Ghazali, 46 F.3d
court also finds that granting the HOA's motion to
dismiss would not enhance the court's ability to
effectively manage its docket. See Ghazali, 46 F.3d
at 53. Additionally, the HOA would neither be forced to wait
for plaintiffs response, nor prejudiced in an outcome on the
merits as the responses are now on record, as is SFR's
court acknowledges the public's interest in an
expeditious resolution of litigation. See Id.
However, dismissal is an inappropriate sanction in this
circumstance because, inter alia, Nationstar and
Deutsche's responses are on record, and the HOA has
already replied to those responses. See (ECF Nos.
83, 84, 91).
the court will not dismiss Nationstar's complaint, and
continues with its analysis under the briefings.
Declaratory Relief/Quiet Title
Nevada, "[a]n action may be brought by any person
against another who claims an estate or interest in real
property, adverse to the person bringing the action for the
purpose of determining such adverse claim." Nev. Rev.
Stat. § 40.010. "A plea to quiet title does not
require any particular elements, but 'each party must
plead and prove his or her own claim to the property in
question' and a 'plaintiffs right to relief therefore
depends on superiority of title." Chapman v.
Deutsche BankNat'l Trust Co., 302 P.3d 1103, 1106
(Nev. 2013) (quoting Yokeno v. Mafnas, 973 F.2d 803,
maintains that it does not have a current adverse interest in
the property as required by a plea to quiet title under NRS
40.010 and asks the court to dismiss it from this claim. (ECF
No. 75 at 6). The HOA states it never made a claim to title,
and that while it had a lien on the property in the past, it
does not currently. (ECF No. 75 at 6).
rule 19(a), a party must be joined as a "required"
party in two circumstances: (1) when "the court cannot
accord complete relief among existing parties" in that
party's absence, or (2) when the absent party
"claims an interest relating to the subject of the
action" and resolving the action in the person's
absence may, as a practical matter, "impair or impede
the person's ability to protect the interest, " or
may "leave an existing party subject to a substantial
risk of incurring double, ...