United States District Court, D. Nevada
J. Dawson United States District Judge.
before the Court is Defendants HSBC Bank and Nationstar
Mortgage, LLC's (“Nationstar”) Motion to
Dismiss (#13). Defendant Bank of America, N.A.
(“BANA”) filed a substantive Joinder (#17) to the
motion. Plaintiff filed a response in opposition (#15) to
which Defendant replied (#28).
about August 31, 2006, Plaintiff, Jose Rodriguez, purchased
property at 4353 Grey Spencer Drive. Plaintiff financed the
purchase with a $726, 543.00 loan from Defendant Countrywide
Bank NA (“Countrywide”). Beginning sometime
between 2007 and 2008 Plaintiff admits that he began to fall
behind in his loan payments. Plaintiff claims that during
this time he was in the process of obtaining a loan
modification from Countrywide. However, on or about March
2009, Plaintiff alleges that he sent a letter to Countrywide,
informing it that Plaintiff was exercising his right to
recission under the Truth in Lending Act
(“TILA”). Countrywide responded by informing
Plaintiff that his time for recission had expired. Plaintiff
claims that he continued in loan modification discussions
with Countrywide, who was later acquired by Defendant BANA.
about May 24, 2010, the Mortgage Electronic Registration
System assigned the Deed of Trust to Defendant HSBC Bank N.A.
(“HSBC”). On or about July 8, 2014, Defendant
HSBC executed a substitution of trustee through Nationstar,
its attorney in fact, designating Defendant Clear Recon Corp.
(“Clear Recon”), as trustee under the deed of
trust. Clear Recon, on behalf of HSBC, initiated the
foreclosure process and recorded a notice of trustee's
sale. HSBC then purchased the property at a trustee's
sale on July 15, 2016 with a credit bid of $850, 219.77.
alleges wrongful foreclosure proceedings and fraud. Plaintiff
also alleges that he properly rescinded the loan under TILA
on or about March of 2009. He seeks to quiet title and to
void the foreclosure sale. Defendants argue that Plaintiff
has failed to state a claim upon which relief may be granted.
may dismiss a plaintiff's 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.” F.R.C.P. 8(a)(2);
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555
(2007). While Rule 8 does not require detailed factual
allegations, it demands more than “labels and
conclusions or a formulaic recitation of the elements of a
cause of action.” Ashcroft v. Iqbal, 556 U.S.
662, 678 (2009) (citations omitted). “Factual
allegations must be enough to raise a right to relief above
the speculative level.” Twombly, 550 U.S. at
555. Thus, “[to]survive a motion to dismiss, a
complaint must contain sufficient factual matter to
‘state a claim for relief that is plausible on its
face.'” Iqbal, 556 U.S. at 678 (citation
Iqbal, the Supreme Court clarified the two-step
approach district courts are to apply when considering
motions to dismiss. First, a district court must accept as
true all well-pled factual allegations in the complaint;
however, legal conclusions or mere recitals of the elements
of a cause of action, supported only by conclusory
statements, are not entitled to the assumption of truth.
Id. at 678. Second, a district court must consider
whether the factual allegations in the complaint allege a
plausible claim for relief. Id. at 679. A claim is
facially plausible when the plaintiff's complaint alleges
facts that allow the court to draw a reasonable inference
that the defendant is liable for the alleged misconduct.
Id. at 678. Further, where the complaint does not
permit the court to infer more than the mere possibility of
misconduct, the complaint has “alleged-but it has not
show[n]-that the pleader is entitled to relief.”
Id. at 679 (internal quotation marks omitted). Thus,
when the claims in a complaint have not crossed the line from
conceivable to plausible, the complaint must be dismissed.
Twombly, 550 U.S. at 570. Moreover, “[a]ll
allegations of material fact in the complaint are taken as
true and construed in the light most favorable to the
non-moving party.” In re Stac Elecs. Sec.
Litig., 89 F.3d 1399, 1403 (9th Cir. 1996) (citation
has a stricter pleading standard under Rule 9, which requires
a party to “state with particularity the circumstances
constituting fraud.” Fed.R.Civ.P. 9(b); Nev. R. Civ. P.
9(b). Pleading fraud with particularity requires “an
account of the time, place, and specific content of the false
representations, as well as the identities of the parties to
the misrepresentations.” Swartz v. KPMG LLP,
476 F.3d 756, 764 (9th Cir. 2007); see also Morris v.
Bank of Nev., 886 P.2d 454, 456, n.1 (Nev.1994). Fraud
claims against corporate or business entities require
allegations that specifically identify names of individuals
who made the misrepresentation, that they had authority to
speak for the corporation, and what was said or written and
when. Smith v. Accredited Home Lenders, 2016 WL
1045507, at *2 (D. Nev. 2016).
Plaintiff's Right of Recision Under TILA
claims that he successfully exercised his right to rescind
under TILA when he sent a recission letter to Defendant
Countrywide in 2009. In the letter, Plaintiff claimed that he
had not received the necessary disclosures that TILA
requires. Several of Plaintiff's causes of action are
based on the theory that Defendants' interest in the
property were extinguished by the allegedly successful
purpose of TILA is “to assure a meaningful disclosure
of credit terms so that the consumer will be able to compare
more readily the various credit terms available to him and
avoid the uninformed use of credit ...” 15 U.S.C.
§ 1601(a). If the creditor fails to make the required
disclosures or rescission notices, the borrower's
“right of rescission shall expire three years after the
date of consummation of the transaction.” 15 U.S.C.
§ 1635(f); see 12 C.F.R. § 226.23(a)(3);
Jesinoski v. Countrywide Home Loans, Inc., 135 S.Ct.
790, 792-93 (2015)(notice to lender of intent to rescind must
be sent within three years of loan execution). However, TILA
does not apply to “residential mortgage
transactions.” 15 U.S.C. § 1635(e). Residential
transactions are defined as “a transaction in which a
mortgage, deed of trust, purchase money security interest
arising under an installment sales contract, or equivalent
consensual security interest is created or retained against
the consumer's dwelling to finance the acquisition or
initial construction of such dwelling.” 15 ...