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Heidig v. PNC Bank N.A.

United States District Court, D. Nevada

September 15, 2017

GUNTER HEIDIG, et al., Plaintiffs,
v.
PNC BANK N.A. C/O TRUSTEES CORPS, et al., Defendants.

          ORDER

          MIRANDA M. DU UNITED STATES DISTRICT JUDGE

         I. SUMMARY

         Before the Court is Defendants'[1] Motion to Dismiss Plaintiffs' First Amended Complaint (“Motion”).[2] (ECF No. 16.) The Court has reviewed Plaintiffs' response (ECF No. 26) and Defendants' reply (ECF No. 28).

         Also before this Court is PNC's Motion for Leave to File Counterclaim (“Motion for Counterclaim”) (ECF No. 36).[3]

         For the reasons discussed below, the Motion is granted and the Motion for Counterclaim is denied as moot.

         II. BACKGROUND

         The following facts are taken from the First Amended Complaint (“FAC”). (ECF No. 11.)

         On August 12, 2005, Plaintiffs Gunter and Janis Heidig obtained a $258, 000 mortgage loan from SOMA Financial (“SOMA”) that was secured by a first mortgage/deed of trust (“DOT”) on the property at 2655 Silky Sullivan Lane, Reno, Nevada (“the Property”). The DOT was recorded in Washoe County on August 18, 2005. This loan was then securitized, but Plaintiff alleges that the promissory note on the DOT (“the Note”) was not properly transferred to Defendant Freddie Mac before the closing date under the PSA.[4] Generally, Plaintiffs allege that: any security interest in the Property was never perfected; the alleged holder of the Note is not the beneficiary of the DOT; the alleged holder of the DOT does not have requisite title, perfected security interest or standing to proceed in a foreclosure; and/or the holder of the DOT is not the real party in interest. Plaintiffs base these allegations on the theory that the security interest is invalid because there was a “splitting or separation of title, ownership and interest in Plaintiffs' Note and [DOT]” as well as errors in assignment of the DOT and a failure to assign and transfer the DOT to Freddie Mac in accordance with the PSA of Defendants, New York Law, and the Uniform Commercial Code. (ECF No. 11 at ¶ 29.) Plaintiffs claim that as a result no true sale occurred and none of the Defendants hold a perfected and secured claim in the Property, thereby estopping Defendants from foreclosing on their home.

         Two notices of default have been recorded on the Property: one on May 31, 2013, and the other on December 24, 2014. The former was rescinded on December 24, 2014, and the latter was rescinded on October 14, 2015. Around December of 2013, Plaintiffs received a second Notice of Default and Election to Sell by the Trustee for Defendants. In April 2015, there was a hearing before a state foreclosure mediator. The mediator denied a certificate of foreclosure. On judicial review, the mediator's findings were upheld. On March 4, 2016, Defendants' Trustee recorded a third Notice of Default and Election to Sell. On September 19, 2016, a Notice of Trustee Sale was recorded and the sale of the Property was scheduled for October 21, 2016.[5]

         Plaintiffs allege nine claims for relief: (1) a cause of action under NRS § 107.028(7) for Defendants' non-compliance with NRS Chapter 107; (2) intentional infliction of emotional distress; (3) negligent infliction of emotional distress; (4) slander of title; (5) quiet title; (6) declaratory relief that Defendants do not have authority to foreclose upon or sell the Property and that Plaintiffs are entitled to exclusive possession of the Property and own it in fee simple; (7) violation of the Real Estate Settlement Procedures Act (“RESPA”); (8) contractual breach of the implied covenant of good faith and fair dealing; and (9) tortious breach of the implied covenant of good faith and fair dealing.

         III. LEGAL STANDARD

         A court 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 pleaded 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); 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) (citing Twombly, 550 U.S. at 555.) In other words, “[f]actual allegations must be enough to rise 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 to relief that is plausible on its face.” Iqbal, 556 U.S. at 678 (internal citation omitted).

         In 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-pleaded factual allegations in the complaint; however, legal conclusions are not entitled to the assumption of truth. Id. at 678-79. Mere recitals of the elements of a cause of action, supported only by conclusory statements, do not suffice. 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 a court to draw a reasonable inference that the defendant is liable for the alleged misconduct. 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 it has not show[n]-that the pleader is entitled to relief.” Id. at 679 (internal quotation marks omitted). 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 complaint must contain either direct or inferential allegations concerning “all the material elements necessary to sustain recovery under some viable legal theory.” Twombly, 550 U.S. at 562 (quoting Car Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101, 1106 (7th Cir. 1989) (emphasis in original)).

         IV. MOTION TO DISMISS (ECF No. 16)

         A. ...


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