United States District Court, D. Nevada
JEFFREY A. DICKERSON Plaintiff,
WELLS FARGO BANK, N.A., Defendant.
C. JONES United States District Judge
case arises out of a residential foreclosure. Plaintiff
Jeffrey Dickerson owns real property at 60 Gazelle, Reno,
NV, 89511 (“the Property”). (Am. Compl. ¶ 1,
ECF No. 38). Defendant Wells Fargo Bank, N.A. (“Wells
Fargo”) is the servicer of a mortgage on the Property,
Defendant Wilmington Trust National, N.A. (“WTN”)
or Defendant Wilmington Trust Co. (“WTC”) was the
trustee of the mortgage, Defendant Quality Loan Service Corp.
(“QLS”) is the substitute trustee, and Defendant
McCarthy & Holthus LLP (“M&H”) is a
representative of Defendants. (Id. ¶¶
3-6). Wells Fargo and QLS scheduled and thrice rescheduled a
foreclosure sale of the Property, the latest sale date being
January 18, 2017. (Id. ¶ 7).
sued Defendants in Nevada state court for “breach of
contract, fraud and defective foreclosure: dual
tracking” based on allegations that Wells Fargo and QLS
had breached a stipulation to dismiss Plaintiff's
petition for judicial review from the Nevada Foreclosure
Mediation Program by failing to consider Plaintiff's
application for a loan modification. Plaintiff alleged in the
alternative that Defendants fraudulently misrepresented their
authority to consider a loan modification. Defendants
removed. Plaintiff moved to remand based on lack of complete
diversity, and Defendants moved to dismiss. The Court denied
the motion to remand and granted the motion to dismiss in
part, dismissing all claims except the claim for breach of
contract against Wells Fargo and QLS, and giving leave to
amend as to the remainder of the claims. Plaintiff filed the
Amended Complaint (“AC”), expanding the
allegations but omitting all Defendants except Wells Fargo.
Wells Fargo has moved to dismiss the AC in part.
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. A motion to dismiss under Rule 12(b)(6) tests the
complaint's sufficiency. See N. Star Int'l v.
Ariz. Corp. Comm'n, 720 F.2d 578, 581 (9th Cir.
1983). 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, under the modern interpretation of
Rule 8(a), a plaintiff must not only specify or imply a
cognizable legal theory (Conley review), he must
also allege the facts of his case so that the court can
determine whether he has any basis for relief under the legal
theory he has specified or implied, assuming the facts are as
he alleges (Twombly-Iqbal review). Put differently,
Conley only required a plaintiff to identify a major
premise (a legal theory) and conclude liability therefrom,
but Twombly-Iqbal requires a plaintiff additionally
to allege minor premises (facts of the plaintiff's case)
such that the syllogism showing liability is complete and
that liability necessarily, not only possibly, follows
(assuming the allegations of fact are true).
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) (citation omitted).
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). Moreover, under Federal Rule
of Evidence 201, a court may take judicial notice of
“matters of public record.” Mack v. S.
Bay Beer Distribs., Inc., 798 F.2d 1279, 1282
(9th Cir. 1986). Otherwise, if the district court considers
materials outside of the pleadings, the motion to dismiss is
converted into a motion for summary judgment. See Arpin
v. Santa Clara Valley Transp. Agency, 261 F.3d 912, 925
(9th Cir. 2001).
Complaint listed a single cause of action for “breach
of contract, fraud and defective foreclosure: dual
tracking.” The Court ruled that Plaintiff had
sufficiently pled a breach of contract against Wells Fargo
but had not sufficiently pled any other claim against any
other Defendant. Specifically, Plaintiff had not pled fraud
with particularity and had not identified which foreclosure
statute(s) he wished to invoke. The AC lists three claims:
(1) breach of contract; (2) “dual tracking” under
Nevada Revised Statutes section (“NRS”)
107.530(2); and (3) false promise. Wells Fargo has moved to
dismiss the second and third claims.
Wells Fargo notes that Plaintiff has added no substantive
allegations to his “dual tracking” claim. The
problem with the previous pleading, however, was that
Plaintiff had not identified any cause of action under which
he meant to sue, and the Court refused to guess at what
section of the NRS he meant to invoke via the phrase
“dual tracking.” The Court had no law against
which to compare the factual allegations under Rule 8(a), so
it can have made no ruling as to whether those allegations
were sufficient. Plaintiff has now identified NRS 107.530(2)
as the basis for his “dual tracking” claim. That
Not later than 30 calendar days after the borrower submits a
complete application for a foreclosure prevention
alternative, the mortgage servicer shall submit to the
borrower a written offer for a foreclosure prevention
alternative or the written statement of the denial of the
application described in subsection 4. The borrower must
accept or reject the offer within 14 calendar days after the
borrower receives the offer. If a borrower does not accept a
written offer for a foreclosure prevention alternative within
14 calendar days after the borrower receives the offer for
the foreclosure prevention alternative, the offer is deemed
to be rejected.
Nev. Rev. Stat. § 107.530(2). Injunctive relief is
available for a violation if no trustee's deed upon sale
has been recorded. Id. at § 107.560(1). The
public records of which the Court may take judicial notice
indicate a trustee's deed was recorded on February 1,
2017 based on a foreclosure sale of January 18, 2017.
Injunctive relief is therefore moot. An action for damages
remains available, however, see Id. at §
107.560(2), and Plaintiff has sufficiently alleged a
violation of NRS 107.530(2). He has alleged that he submitted
“the necessary and requested documentation” no
later than March 14, 2016 and that Wells Fargo had not
responded as of the date of the AC, i.e., December 27, 2016.
(Am. Compl. ¶¶ 11-12 & n.1). Wells Fargo was
bound by the statute to provide either a written offer of
foreclosure prevention or a written denial of the application
no later than April 13, 2016. See Nev. Rev. Stat.
§ 107.530(2). The Court will not dismiss this claim on
Wells Fargo argues that Plaintiff has not stated a fraud
claim under either Rule 8(a) or Rule 9(b). The Court agrees
that no fraud claim is stated under Rule 8(a), so it need not
address Rule 9(b). Plaintiff alleges Wells Fargo had no
intention of considering Plaintiff's modification
application when it stipulated to consider it in the state
district court. In Nevada, the failure to fulfill a promise
to perform in the future may give rise to a fraud claim if
the promisor “had no intention to perform at the time
the promise was made.” Bulbman, Inc. v. Nev.
Bell, 825 P.2d 588, 592 (Nev. 1992). The copy of the
dismissal order attached to the present motion does not tend
to show that Wells Fargo made such an agreement,
however. The parties stipulated that the petition
for judicial review was untimely. Accordingly, the state
district court had no jurisdiction to do anything but dismiss
for lack of subject matter jurisdiction, without ruling on
the merits, because the 30-day limitation period for judicial
review of foreclosure mediation proceedings (like limitation
periods for judicial review of administrative decisions in
Nevada generally) is jurisdictional. See Nationstar
Mortg. v. Rodriguez,375 P.3d 1027, 1028-30 (Nev. 2016)
(citing Washoe Cnty. v. Otto,282 P.3d 719, 725
(Nev. 2012)). And even if the state district court had had
jurisdiction, the dismissal order does not purport to require
Wells Fargo to consider any application. It notes that the
foreclosure could proceed and requires Plaintiff to use his
best efforts to apply for a loan modification without
commenting on Wells Fargo's alleged duty to consider it.
It remains possible, of course, that Wells Fargo ...