United States District Court, D. Nevada
U.S. BANK TRUST, N.A., Trustees for LSF8 Master Participation Trust, Plaintiff,
FODOR FAMILY TRUST; PALO VERDE HOMEOWNERS ASSOCIATION, INC., Defendants.
M. Navarro, United States District Judge
before the Court are the Motions to Dismiss, (ECF Nos. 28,
35), filed by Defendants Fodor Family Trust
(“Fodor”) and Palo Verde Homeowners Association
(“HOA”). Plaintiff U.S. Bank Trust, N.A.
(“Plaintiff”) filed Responses, (ECF Nos. 32, 39),
and Fodor and HOA filed Replies, (ECF Nos. 33, 41). For the
reasons discussed below, the Court GRANTS
HOA's Motion to Dismiss.
case arises from the non-judicial foreclosure on real
property located at 751 Palo Verde Circle #2, Las Vegas,
Nevada 89119 (the “Property”). (First Am. Compl.
(“FAC”) ¶ 8, ECF No. 1). On May 31, 2005,
Marian S. Schoenfeld (“Borrower”) purchased the
Property by way of a loan in the amount of $577, 000.00 with
Ascent Home Loans (“Ascent”); and Ascent recorded
that loan as a deed of trust (“DOT”) on the
Property. (Id. ¶ 10). Borrower subsequently
defaulted on the loan, for which Ascent's agent recorded
a Notice of Breach and Default and Election to Sell.
(Id. ¶ 11).
September 28, 2007, Household Finance Realty Corporation of
Nevada received an assignment of the DOT from Ascent.
(Id. ¶ 11). Thereafter, on March 25, 2011, HOA
began foreclosure proceedings on the Property by filing a
Notice of Delinquent Assessment on the Property due to
Borrower's failure to meet payment obligations to the
HOA. (Id. ¶¶ 13-14). Moreover, HOA began
those foreclosure proceedings pursuant to Nevada Revised
Statutes (“NRS”) Chapter 116. (Id.
¶¶ 19, 32). HOA then recorded, through its agent, a
Notice of Default and Election to Sell on the Property.
(Id. ¶¶ 15-16). On December 28, 2012, HOA
sold the Property by public auction to Palo Verde Circle
Trust (the “Circle Trust”); and the Trust
recorded the sale with a foreclosure deed on January 2, 2013.
(Id. ¶¶ 18-19).
received an assignment of the DOT from Household Finance
Realty Corporation of Nevada on April 8, 2014. Roughly one
year later, on March 26, 2015, the Circle Trust conveyed its
title to the Property to Fodor. (Id. ¶ 24).
now seeks to challenge the HOA's foreclosure sale of the
Property. Plaintiff accordingly filed its initial Complaint,
followed by its First Amended Complaint, asserting the
following causes of action against various parties involved
in the foreclosure and subsequent sale of the Property: (1)
quiet title / declaratory relief; (2) declaratory relief
under the Fifth Amendment and Fourteenth Amendment; (3) quiet
title under the Fifth Amendment and Fourteenth Amendment; (4)
injunctive relief; (5) breach of statutory duty; (6)
negligent misrepresentation; (7) breach of contract; and (8)
breach of covenant of good faith and fair dealing.
(Id. ¶¶ 63-142).
12(b)(6) of the Federal Rules of Civil Procedure mandates
that a court dismiss a cause of action that fails to state a
claim upon which relief can be granted. See North 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) (emphasis added). In order
to survive a motion to dismiss, a complaint must allege
“sufficient factual matter, accepted as true, 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.
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 Fed. R. Civ. P. 12(d); 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. Pursuant to Rule 15(a), the court
should “freely” give leave to amend “when
justice so requires, ” and in the absence of a reason
such as “undue delay, bad faith or dilatory motive on
the part of the movant, repeated failure to cure deficiencies
by amendments previously allowed, undue prejudice to the
opposing party by virtue of allowance of the amendment,
futility of the amendment, etc.” 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
argues that the Court should dismiss Plaintiff's
Complaint because each named cause of action is time-barred.
(Mot. to Dismiss (“MTD”) 1:27-2:5, ECF No. 35).
Additionally, HOA argues the Court should dismiss
Plaintiff's contract causes of action for failure to
state a claim. (Id. 13:4-14:21). In response,
Plaintiff argues that his claims are timely because the
statute of limitations “did not begin to run until
September 18, 2014, ” which is the date the Nevada
Supreme Court issued its ruling in SFR Investments Pool
1, LLC v. U.S. Bank, 334 P.3d 408 (Nev. 2014).
(See Pl.'s ...