United States District Court, D. Nevada
M. Navarro, Chief Judge United States District Court
before the Court is Defendant SFR Investment Pool 1,
LLC's (“SFR's”) Motion to Dismiss the
Complaint, (ECF No. 13). Plaintiff Bank of New York Mellon
(“Plaintiff”) filed a Response, (ECF No. 14), and
SFR filed a Reply, (ECF No. 15). For the reasons discussed
below, the Court DENIES SFR's Motion.
case arises from the non-judicial foreclosure of real
property located 5956 Feral Garden Street, Las Vegas, Nevada
89031 (the “Property”). (See Deed of
Trust at 5, Ex. 1 to Compl., ECF No. 1-2); (Compl. ¶ 2
at 2, ECF No. 1). In 2006, Isabel Rivera and Rolando Perez
(“Borrowers”) purchased the Property with a loan
in the amount of $216, 848.00, secured by a deed of trust
(the “DOT”). (Compl. ¶ 1 at 3, ECF
No. 1). Plaintiff gained beneficial interest in the DOT
through an assignment recorded on January 14, 2011. (See
Id. ¶ 4).
Borrowers' failure to stay current on their payment
obligations, Leach, Johnson, Song & Gruchow, as an
authorized agent of the homeowners' association for the
Property (Sierra Ranch Homeowners Association)
(“HOA”), initiated foreclosure proceedings and
sold the Property at public auction on May 22, 2014. (See
Id. ¶¶ 3-7).
to Plaintiff, however, Plaintiff's servicing agent
tendered the outstanding lien amount to the HOA or its agents
prior to the Property's foreclosure sale, “thereby
satisfying any amount which may have held priority over
Plaintiff's DOT. (Id. ¶ 8). Plaintiff
accordingly filed the instant Complaint on February 19, 2018,
asserting one claim for declaratory relief: quiet title.
(Id. ¶¶ 20-21, 30-42). In that claim,
Plaintiff seeks a declaration that the Property's
foreclosure sale did not extinguish Plaintiff's DOT, and
thus the DOT continues to encumber the Property.
(Id.). On April 20, 2018, SFR filed its Motion to
dismiss Plaintiff's sole claim, arguing that the
applicable statute of limitations under Nevada law renders
the claim untimely. (SFR's Mot. Dismiss.
(“MTD”) 2:3-15, ECF No. 13).
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. 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.
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). A
formulaic recitation of a cause of action with conclusory
allegations is not sufficient; a plaintiff must plead facts
showing that a violation is plausible, not just
possible. Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (citing Twombly, 550 U.S. at 555).
may also dismiss a complaint pursuant to Federal Rule of
Civil Procedure 41(b) for failure to comply with Federal Rule
of Civil Procedure 8(a). Hearns v. San Bernardino Police
Dept., 530 F.3d 1124, 1129 (9th Cir.2008). Rule 8(a)(2)
requires that a plaintiff's complaint contain “a
short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2).
“Prolix, confusing complaints” should be
dismissed because “they impose unfair burdens on
litigants and judges.” McHenry v. Renne, 84
F.3d 1172, 1179 (9th Cir.1996).
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) (citations 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). Under Federal Rule of Evidence
201, a court may take judicial notice of “matters of
public record.” Mack v. S. Bay Beer Distrib.,
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).
court grants a motion to dismiss, it must then decide whether
to grant leave to amend. The court should “freely
give” leave to amend when there is no “undue
delay, bad faith[, ] dilatory motive on the part of the
movant . . . undue prejudice to the opposing party by virtue
of . . . the amendment, [or] futility of the amendment . . .
.” Fed.R.Civ.P. 15(a); Foman v. Davis, 371
U.S. 178, 182 (1962). Generally, leave to amend is only
denied when it is clear that the deficiencies of the
complaint cannot be cured by amendment. See DeSoto v.
Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir.
moves to dismiss Plaintiff's quiet title claim as
time-barred under a three-year statute of limitations period
pursuant to Nevada Revised Statute (“NRS”)
11.190(3)(a). (SFR's MTD 6:17-8:16, ECF No. 13). That
statute applies to actions based “upon a liability
created by statute.” NRS 11.190(3)(a). In response,
Plaintiff argues that NRS 11.190(a)(3) is inapplicable to its
quiet title claim because Plaintiff only seeks
“judicial review of the facts and statutes at play in
the HOA Sale in order ...