United States District Court, D. Nevada
DIANE M. STACEY, Plaintiff,
NATIONSTAR MORTGAGE, LLC, et al., Defendants.
M. Navarro, United States District Judge
before the Court is the Motion to Dismiss, (ECF No. 5), filed
by Defendants Nationstar Mortgage, LLC
(“Nationstar”) and U.S. Bank National Association
(“U.S. Bank”) (collectively
“Defendants”). Plaintiff Diane M. Stacey
(“Plaintiff) filed a Response, (ECF No. 9), and
Defendants filed a Reply, (ECF No. 15). For the reasons
discussed herein, Defendants' Motion to Dismiss is
quiet title action arises from Nationstar's institution
of foreclosure proceedings on real property located at 2297
Feathertree Ave., Henderson, Nevada 89052 (the
“Property”). (Compl. ¶ 8, Ex. A to Pet. for
Removal, ECF No. 1-1). Plaintiff purchased the Property in
2005 by way of a loan from Stonecreek Funding Corporation
(“Stonecreek”). (Id. ¶ 9).
Stonecreek later sold the loan to Countrywide Mortgage, an
entity which non-party Bank of America (“BANA”)
later purchased. (Id. ¶ 10).
financial distress, Plaintiff stopped making payments on her
loan and contacted BANA to request a loan modification.
(Id. ¶¶ 11-12). Over the next few years,
BANA repeatedly refused any modification and allegedly
changed its explanation for its refusal multiple times.
(Id. ¶¶ 13-14). In 2013, Specialized Loan
Servicing, LLC (“SLS”) became servicer of the
loan in BANA's place. (Id. ¶ 15). Defendant
Nationstar took over the loan servicing from SLS in 2014,
after which Plaintiff initiated correspondence with
Nationstar concerning her sought-after loan modification.
(Id. ¶¶ 16-17). Plaintiff alleges that
Nationstar, like BANA previously, consistently rebuffed
Plaintiff's pleas for a modification and offered
contradictory explanations for those rejections.
(Id. ¶ 18).
December 19, 2017, Nationstar moved forward with foreclosure
proceedings, recording a notice of default and election to
sell. (Id. ¶ 20). Plaintiff subsequently filed
a state-court petition to mediate the dispute pursuant to
Nevada's Foreclosure Mediation Program
(“FMP”). (See Pet. for Foreclosure
Mediation, Stacey v. U.S. Bank Nat'l Ass'n,
No. A-18-768548-FM (Nev. 8th Jud. Dist. Ct. Jan. 29, 2018),
Ex. I to Defs.' Mot. to Dismiss (“MTD”), ECF
No. 5-9). Following an unsuccessful mediation, the
state court ordered the issuance of an FMP Certificate,
authorizing continuation of the foreclosure. (See
FMP Certificate, Ex. N to MTD, ECF No. 5-14). In the wake of
the court's order, Defendants proceeded with foreclosure
by recording a notice of sale and setting a sale date for
January 22, 2019. (Compl. ¶ 21).
filed this action in state court on January 11, 2019,
bringing claims arising from Defendants' alleged
unwillingness to negotiate a loan modification and subsequent
institution of foreclosure proceedings. Plaintiff asserts two
causes of action for quiet title and breach of the implied
covenant of good faith and fair dealing. (Id.
¶¶ 22-32). Shortly after Plaintiff filed her
Complaint, Defendants removed this matter from state court
and filed the instant Motion to Dismiss. (See Pet.
for Removal, ECF No. 1); (MTD, ECF No. 5).
is appropriate under Rule 12(b)(6) where a pleader fails to
state a claim upon which relief can be granted. Fed.R.Civ.P.
12(b)(6); Bell Atl. Corp. v. Twombly, 550 U.S. 544,
555 (2007). A pleading must give fair notice of a legally
cognizable claim and the grounds on which it rests, and
although a court must take all factual allegations as true,
legal conclusions couched as factual allegations are
insufficient. Twombly, 550 U.S. at 555. Accordingly,
Rule 12(b)(6) requires “more than labels and
conclusions, and a formulaic recitation of the elements of a
cause of action will not do.” Id. “To
survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 570). “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. This standard “asks for more than a sheer
possibility that a defendant has acted unlawfully.”
a district court may not consider any material beyond the
pleadings in a ruling on a Rule 12(b)(6) motion.”
Hal Roach Studios, Inc. v. Richard Feiner & Co.,
896 F.2d 1542, 1555 n.19 (9th Cir. 1990). “However,
material which is properly submitted as part of the complaint
may be considered.” Id. 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 a
Ruling on a Rule 12(b)(6) motion to dismiss. Branch v.
Tunnell, 14 F.3d 449, 454 (9th Cir. 1994). On a motion
to dismiss, a court may also take judicial notice of
“matters of public record.” Mack v. S. Bay
Beer Distrib., 798 F.2d 1279, 1282 (9th Cir. 1986).
Otherwise, if a court considers materials outside of the
pleadings, the motion to dismiss is converted into a motion
for summary judgment. Fed.R.Civ.P. 12(d).
seek dismissal of Plaintiff's quiet title claim on the
basis that it is barred by issue or claim preclusion. (MTD
6:8-10:19, ECF No. 5). Defendants also contend the quiet
title claim fails as a matter of law in light of
Plaintiff's concession that she defaulted on her loan.
(Id. 10:24-12:21). Finally, Defendants argue that
Plaintiff's bad-faith claim must be dismissed for
Plaintiff's failure to allege a contract between the
parties or other facts identifying wrongdoing on
Defendants' part. (Id. 14:13-15:2).
Court first turns to Defendants' request for judicial
notice, followed by discussion of issue preclusion.