JUNE 3, 2013 NON-LEGAL LAYPERSONS OPINION ON THESE CASES:

A LETTER WRITTEN TO SENATOR BOXER AND FEINSTEIN: I KNOW THAT SENATOR BOXER WORKED VERY HARD ON BEHALF OF HOMEOWNER-BORROWERS FOR MORTGAGES IN PUSHING THROUGH LEGISLATION FOR TILA TITLE 15 1641---SEE BELOW HOWEVER, AS THE ATTACHED CASE DECISIONS SHOW, THE COURTS ARE NOT ABIDING BY THE NEW LAWS AND THE BANK ATTORNEYS WIN EVERY SINGLE TIME. MANY HOMEOWNER-BORROWER ATTORNEYS DO NOT UNDERSTAND NOR APPLY THE TILA CORRECTLY. HOMEOWNER-BORROWERS DO NOT HAVE A CHANCE IN COURT AND AS YOU CAN CLEARLY READ ON THE RECORD FOR THE FIRST CASE---THE JUDGE SAYS HE DOES NOT HAVE TIME AND HE SAYS TO CONTACT YOU ALL TO SAY THAT!! JUDGES MUST ALLOW HOMEOWNER-BORROWERS THEIR DUE PROCESS AND EQUAL ACCESS TO THE COURTS. ADDITIONALLY, MANY HOMEOWNER-BORROWERS REALIZE THAT JUDGES RETIREMENT PLANS ARE HEAVILY INVESTED IN THE MBS (SECURITIES OF MORTGAGES) AND SO ARE ALL FEDERAL WORKERS RETIREMENT PLANS AS WELL AS STATE JUDGES, DISTRICT ATTORNEYS ETC. ETC. EVEN THE US JUSTICE DEPARTMENT RETIREMENT PLANS ARE HEAVILY INVESTED IN THE MBS! NO JUDGE HAS RECUSED HIMSELF OR HERSELF DUE TO THIS HORRIFIC CONFLICT OF INTEREST. THE HOMEOWNERS-BORROWERS AND MAIN STREET AMERICANS ARE STILL SUFFERING OUT HERE. WE WERE PUT INTO LOANS DOOMED TO FAILURE AND FORECLOSURE!

AND WITH BOTH THE OCC IFR SETTLEMENT AND THE 49 STATE AG SETTLEMENT THERE WAS NO INVESTIGATION INTO THE FACT THAT MOST OF THESE MORTGAGE LOANS WERE NOT REFIS---IN THE TRADITIONAL SENSE---THEY WERE MODIFICATIONS OF DEFAULT DEBT (FALSELY PLACED DEFAULT)----NO PRIOR LOANS WERE EVER PAID OFF DURING THE SO CALLED REFI! THE PRIOR LOANS WHICH LOOK LIKE A REFI---WERE ALREADY SECURITIZED AND PLACED INTO FALSE DEFAULT! BORROWERS NEED TO GET ALL THE INFORMATION ABOUT THEIR PRIOR LOAN TOO. THE OCC MORTGAGE SETTLEMENT AND THE 49 STATE AG SETTLEMENT MERELY DEALT WITH GETTING RID OF THE ROBO-SIGNING ISSUE. CONGRESS STILL NEEDS TO CAUSE AN INVESTIGATION TO HAPPEN! FOCUS ON THE FACT THAT THE PHONY REFIS WERE REALLY A BACK END MODIFICATION OF A FALSE DEFAULT DEBTAND THE PRIOR LOAN WAS NEVER PAID OFF WITH THE PHONY REFI. FIRE ERIC HOLDER IF YOU NEED TO. YOU NEED TO HAVE AN INVESTIGATION WHICH GOES DEEP. AND ONE MORE THING----THE IRS SHOULD BE HEAVILY INVESTIGATING THE REMIC FRAUD RELATED TO THE MBS. THE MBS TRUSTS WERE EMPTY! THE IRS COULD SOLVE THE US BUDGET DEFICIT IF THEYD DO THEIR JOB AND INVESTIGATE THE REMIC TAX EVASION SCHEME. __________________________________ TITLE 15 CHAPTER 41 SUBCHAPTER I PART B 1641 TILA Liability of assignees (c) Right of rescission by consumer unaffected Any consumer who has the right to rescind a transaction under section 1635 of this title may rescind the transaction as against any assignee of the obligation.

(f) Treatment of servicer (1) In general A servicer of a consumer obligation arising from a consumer credit transaction shall not be treated as an assignee of such obligation for purposes of this section unless the servicer is or was the owner of the obligation. (2) Servicer not treated as owner on basis of assignment for administrative convenience. A servicer of a consumer obligation arising from a consumer credit transaction shall not be treated as the owner of the obligation for purposes of this section on the basis of an assignment of the obligation from the creditor or another assignee to the servicer solely for the administrative convenience of the servicer in servicing the obligation. Upon written request by the obligor, the servicer shall provide the obligor, to the best knowledge of the servicer, with the name, address, and telephone number of the owner of the obligation or the master servicer of the obligation. SENATOR BOXER PROPOSED AND CONGRESS PASSED Section 404 of Public Law 111-22 in the Helping Families Save Their Homes Act (the Act) by amendeding Section 131 of the Truth in Lending Act (15 USC 1641)(TILA) to include a new provision (Section 131(g)) that requires the assignee of a mortgage loan to notify a consumer borrower that his loan has been transferred. This notice requirement became effective immediately upon the Presidents signature on May 19, 2009. A mortgage loan means any consumer credit transaction that is secured by the principal dwelling of a consumer. 15 USC 1641(g)(2). Under TILA, a dwelling is a one-to-four family residential structure, including a manufactured home. THE COURTS ARE DISMISSING THE BORROWERS RIGHT TO CHALLENGE THE PSA (TRUSTEE OF MBS) AS THE CREDITOR, WHEN SENATOR BOXERS AMENDMENT DEMANDS THAT THE CREDITOR IDENTIFY THEMSELVES TO THE BORROWERS WITH PHONE NUMBER, AND ADDRESS CONTACT INFORMATION SO THAT THEY MAY CONTACT DIRECTLY. THE ASSIGNMENTS WHICH REMOVE LOANS FROM THE MBS TRUSTS (IRS REQUIRES THAT ALL FORECLOSURES BE REMOVED WITHIN 11 MONTHSAS REMIC REQUIRES CURRENT CASH FLOW PASS-THROUGH---ARE NOT

BEING PROVIDED TO BORROWERS---MAKING IT VERY IMPOSSIBLE TO UTILZE YOUR AMENDMENT.

IN EFFECT, SENATORS BOXER AND FEINSTEIN, THINGS HAVE GOTTEN WORSE FOR THE HOMEOWNER-BORROWERS ESPECIALLY IN CALIFORNIA. PLEASE EXAMINE THIS CLOSELY AND DO SOMETHING TO HELP US MAIN STREET AMERICANS. REGARDS, nnnnnnnnnnn REVIEW THESE CASE DECISIONS BELOW---ALWAYS CONSULT WITH A COMPETENT ATTORNEY BEFORE TAKING ANY ACTION. THE ABOVE IS A LAYPERSON OPINION AND NOT TO BE CONSTRUED AS LEGAL ADVICE.
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ART MADLAING, Plaintiff, vs. JPMORGAN CHASE BANK, N.A., et al., Defendants. CASE NO. CV F 12-2069 LJO SMS UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA 2013 U.S. Dist. LEXIS 76974

May 31, 2013, Decided May 31, 2013, Filed CORE TERMS: foreclosure, notice, borrower, rescission, lender, default, deed of trust, beneficiary, mortgage, racketeering activity, substitution, discovery, recorded, cause of action, disclosure, nonjudicial, power of sale, obligor, unfair, beneficial interest, limitations period, diligence, equitable tolling, foreclosure sale, statute of limitations, mortgagee, slander, indebtedness, conclusory, foreclose

COUNSEL: [*1] For Art G. Madlaing, Plaintiff: Megan Ann Dailey, Law Office of Megan Dailey, Concord, CA; Michael James Yesk, Yesk Law, Legal Division, Pleasant Hill, CA.

For JPMorgan Chase Bank, N.A., MERS, Wells Fargo Bank, N.A., as trustee for the certificate holders of Structured Asset Mortgage Investments II Inc., Defendants: Golareh Mahdavi, LEAD ATTORNEY, Bryan Cave LLP, San Francisco, CA; Hielam Chan, LEAD ATTORNEY, Bryan Cave, LLP, San Francisco, CA. JUDGES: Lawrence J. O'Neill, UNITED STATES DISTRICT JUDGE. OPINION BY: Lawrence J. O'Neill OPINION ORDER ON DEFENDANTS' F.R.Civ.P. 12 MOTION TO DISMISS (Doc. 13.) PRELIMINARY STATEMENT TO PARTIES AND COUNSEL Judges in the Eastern District of California carry the heaviest caseload in the nation, and this Court is unable to devote inordinate time and resources to individual cases and matters. This Court cannot address all arguments, evidence and matters raised by parties and addresses only the arguments, evidence and matters necessary to reach the decision in this order given the shortage of district judges and staff. The parties and counsel are encouraged to contact United States Senators Diane Feinstein and Barbara Boxer to address this Court's inability to accommodate the parties [*2] and this action. INTRODUCTION Defendants JPMorgan Chase Bank, N.A. ("Chase"), Wells Fargo Bank, N.A. ("Wells Fargo"), and Mortgage Electronic Registration Systems, Inc. ("MERS") seek to dismiss as legally barred and insufficiently pled plaintiff Art G. Madlaing's ("Mr. Madlaing's") claims arising from foreclosure of his Clovis property ("property"). Mr. Madlaing responds that Chase, Wells Fargo and MERS (collectively "defendants") lacked "legal power" to foreclose on the property to entitle Mr. Madlaing to pursue his claims. This Court considered defendants' F.R.Civ.P. 12(b)(6) motion to dismiss on the record without a hearing. See Local Rule 230(g). For the reasons discussed below, this Court DISMISSES this action against defendants. BACKGROUND Mr. Madlaing's Property Loan And Foreclosure On September 11, 2006, Mr. Madlaing obtained a $515,000 loan from Preferred Financial Group, Inc. ("PFG") and which was secured by a Deed of Trust ("DOT") on the property. The DOT identifies PFG as lender, MERS as the lender's nominee, and First American Title Company ("First American") as trustee. On September 8, 2009, Quality Loan Service Corp. ("QLS"), as agent for the loan's beneficiary, recorded a [*3] notice of default ("default notice").1 On October 20, 2009, QLS recorded a Substitution of Trustee ("trustee substitution") to substitute as the new trustee

under the DOT. Wells Fargo signed the trustee substitution. On October 28, 2009, an Assignment of Deed of Trust ("DOT assignment") was recorded to reflect assignment to Wells Fargo of all beneficial interest under the DOT.

- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - 1 Documents pertaining to Mr. Madlaing's loan, default and foreclosure were recorded with the Fresno County Recorder. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - On October 1, 2010, QLS recorded a notice of trustee's sale, but the sale did not proceed. On January 20, 2011, QLS recorded a second notice of trustee's sale to set a February 14, 2011 sale. The sale proceeded but was rescinded. On April 5, 2011, QLS recorded another notice of trustee's sale but the sale has been postponed. Mr. Madlaing's Claims Mr. Madlaing's operative complaint ("complaint") accuses defendants of "wrongful, illegal, and permanently damaging activities." The complaint alleges claims for breach of contract, slander of title and wrongful foreclosure. The complaint alleges violation of California statutes, including California Civil Code section 2923.5 and the Unfair Competition Law [*4] ("UCL"), Cal. Bus. & Prof. Code, 17200, et seq. The complaint further alleges claims under federal statutes, including the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. 2601, et seq., Truth in Lending Act ("TILA"), 15 U.S.C. 1601, et seq., and the Racketeer and Corrupt Practices Act ("RICO"), 18 U.S.C. 1961, et seq. The complaint's claims will be discussed below. DISCUSSION F.R.Civ.P. 12(b)(6) Motion To Dismiss Standards Defendants challenge the complaint's claims as legally barred and insufficiently plead. A F.R.Civ.P. 12(b)(6) dismissal is proper where there is either a "lack of a cognizable legal theory" or "the absence of sufficient facts alleged under a cognizable legal theory." Balisteri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1990); Graehling v. Village of Lombard, Ill., 58 F.3d 295, 297 (7th Cir. 1995). A F.R.Civ.P. 12(b)(6) motion "tests the legal sufficiency of a claim." Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). In addressing dismissal, a court must: (1) construe the complaint in the light most favorable to the plaintiff; (2) accept all well-pleaded factual allegations as true; and (3) determine whether plaintiff can prove any [*5] set of facts to support a claim that would merit relief. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-338 (9th Cir. 1996). Nonetheless, a court is not required "to accept as true allegations that are merely conclusory, unwarranted

deductions of fact, or unreasonable inferences." In re Gilead Sciences Securities Litig., 536 F.3d 1049, 1055 (9th Cir. 2008) (citation omitted). A court "need not assume the truth of legal conclusions cast in the form of factual allegations," U.S. ex rel. Chunie v. Ringrose, 788 F.2d 638, 643, n. 2 (9th Cir.1986), and must not "assume that the [plaintiff] can prove facts that it has not alleged or that the defendants have violated . . . laws in ways that have not been alleged." Associated General Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S. 519, 526, 103 S.Ct. 897 (1983). A court need not permit an attempt to amend if "it is clear that the complaint could not be saved by an amendment." Livid Holdings Ltd. v. Salomon Smith Barney, Inc., 416 F.3d 940, 946 (9th Cir. 2005). A plaintiff is obliged "to provide the 'grounds' of his 'entitlement to relief' [which] requires more than labels and conclusions, and a formulaic [*6] recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly, 550 U.S. 554,127 S. Ct. 1955, 1964-65 (2007) (internal citations omitted). Moreover, a court "will dismiss any claim that, even when construed in the light most favorable to plaintiff, fails to plead sufficiently all required elements of a cause of action." Student Loan Marketing Ass'n v. Hanes, 181 F.R.D. 629, 634 (S.D. Cal. 1998). In practice, a complaint "must contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory." Twombly, 550 U.S. at 562, 127 S.Ct. at 1969 (quoting Car Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101, 1106 (7th Cir. 1984)). In Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949 (2009), the U.S. Supreme Court explained: . . . a complaint must contain sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face." . . . 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. . . . The plausibility standard is not akin [*7] to a "probability requirement," but it asks for more than a sheer possibility that a defendant has acted unlawfully. (Citations omitted.) After discussing Iqbal, the Ninth Circuit summarized: "In sum, for a complaint to survive [dismissal], the non-conclusory 'factual content,' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. Secret Service, 572 F.3d 962, 989 (9th Cir. 2009) (quoting Iqbal, 556 U.S. 662, 129 S.Ct. at 1949). The U.S. Supreme Court applies a "two-prong approach" to address dismissal: First, the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice. . . . Second, only a complaint that states a plausible claim for relief survives a motion to dismiss. . . . Determining whether a complaint states a plausible claim for relief will . . . be a context-specific task that

requires the reviewing court to draw on its judicial experience and common sense. . . . But where the well-pleaded facts do not permit the court [*8] 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." Fed. Rule Civ. Proc. 8(a)(2). In keeping with these principles a court considering a motion to dismiss can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth. While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations. When there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief. Iqbal, 556 U.S. 662, 129 S.Ct. at 1949-1950. Moreover, a court may consider exhibits submitted with the complaint. Durning v. First Boston Corp., 815 F.2d 1265, 1267 (9th Cir. 1987); Van Winkle v. Allstate Ins. Co., 290 F.Supp.2d 1158, 1162, n. 2 (C.D. Cal. 2003). A "court may consider evidence on which the complaint 'necessarily relies' if: (1) the complaint refers to the document; (2) the document is central to the plaintiff's claim; and (3) no party questions the authenticity of the copy attached to the 12(b)(6) motion." Marder v. Lopez, 450 F.3d 445, 448 (9th Cir. 2006). [*9] A court may treat such a document as "part of the complaint, and thus may assume that its contents are true for purposes of a motion to dismiss under Rule 12(b)(6)." United States v. Ritchie, 342 F.3d 903, 908 (9th Cir.2003). Such consideration prevents "plaintiffs from surviving a Rule 12(b)(6) motion by deliberately omitting reference to documents upon which their claims are based." Parrino v. FHP, Inc., 146 F.3d 699, 706 (9th Cir. 1998).2 A "court may disregard allegations in the complaint if contradicted by facts established by exhibits attached to the complaint." Sumner Peck Ranch v. Bureau of Reclamation, 823 F.Supp. 715, 720 (E.D. Cal. 1993) (citing Durning v. First Boston Corp., 815 F.2d 1265, 1267 (9th Cir.1987)).

- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - 2 "We have extended the 'incorporation by reference' doctrine to situations in which the plaintiff's claim depends on the contents of a document, the defendant attaches the document to its motion to dismiss, and the parties do not dispute the authenticity of the document, even though the plaintiff does not explicitly allege the contents of that document in the complaint." Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005) (citing Parrino, 146 F.3d at 706). - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - Lastly, [*10] under F.R.Evid. 201, a court may take judicial notice of "matters of public record." Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001); MGIC Indem. Corp. v. Weisman, 803 F.2d 500, 504 (9th Cir. 1986) ("On a motion to dismiss, we may take

judicial notice of matters of public record outside the pleadings); Mack v. South Bay Beer Distrib., 798 F.2d 1279, 1282 (9th Cir.1986). With these standards in mind, this Court turns defendants' challenges to the complaint's claims. Failure To Tender Indebtedness Defendants characterize as "fatal" the complaint's failure to allege Mr. Madlaing's tender of his indebtedness given that the complaint's claims challenge foreclosure proceedings or seek damages related to the foreclosure proceedings. Mr. Madlaing claims that he is not obligated to tender his indebtedness "because it would be inequitable to require tender" and "Defendants lacked the legal power to foreclose." General Principles "When a debtor is in default of a home mortgage loan, and a foreclosure is either pending or has taken place, the debtor must allege a credible tender of the amount of the secured debt to maintain any cause of action for wrongful foreclosure." Alicea v. GE Money Bank, 2009 WL 2136969, at *3 (N.D. Cal. 2009). "A [*11] tender is an offer of performance made with the intent to extinguish the obligation." Arnolds Management Corp. v. Eischen, 158 Cal.App.3d 575, 580, 205 Cal.Rptr. 15 (1984) (citing Cal. Civ. Code, 1485; Still v. Plaza Marina Commercial Corp., 21 Cal.App.3d 378, 385, 98 Cal.Rptr. 414 (1971)). "A tender must be one of full performance . . . and must be unconditional to be valid." Arnolds Management, 158 Cal.App.3d at 580, 205 Cal.Rptr. 15. "Nothing short of the full amount due the creditor is sufficient to constitute a valid tender, and the debtor must at his peril offer the full amount." Rauer's Law etc. Co. v. S. Proctor Co., 40 Cal.App. 524, 525, 181 P. 71 (1919). Foreclosure Irregularities A defaulted borrower is "required to allege tender of the amount of [the lender's] secured indebtedness in order to maintain any cause of action for irregularity in the sale procedure." Abdallah v. United Savings Bank, 43 Cal.App.4th 1101, 1109, 51 Cal.Rptr.2d 286 (1996), cert. denied, 519 U.S. 1081, 117 S.Ct. 746 (1997). "A party may not without payment of the debt, enjoin a sale by a trustee under a power conferred by a deed of trust, or have his title quieted against the purchaser at such a sale, [*12] even though the statute of limitations has run against the indebtedness." Sipe v. McKenna, 88 Cal.App.2d 1001, 1006, 200 P.2d 61 (1948). In FPCI RE-HAB 01 v. E & G Investments, Ltd., 207 Cal.App.3d 1018, 1021, 255 Cal.Rptr. 157 (1989), the California Court of Appeal explained: . . . generally "an action to set aside a trustee's sale for irregularities in sale

notice or procedure should be accompanied by an offer to pay the full amount of the debt for which the property was security." . . . . This rule . . . is based upon the equitable maxim that a court of equity will not order a useless act performed. . . . "A valid and viable tender of payment of the indebtedness owing is essential to an action to cancel a voidable sale under a deed of trust." . . . The rationale behind the rule is that if plaintiffs could not have redeemed the property had the sale procedures been proper, any irregularities in the sale did not result in damages to the plaintiffs. (Citations omitted.) An action to set aside a foreclosure sale, unaccompanied by an offer to redeem, does not state a cause of action which a court of equity recognizes. Karlsen v. American Sav. & Loan Assn., 15 Cal.App.3d 112, 117, 92 Cal.Rptr. 851 (1971). [*13] The basic rule is that an offer of performance is of no effect if the person making it is not able to perform. Karlsen, 15 Cal.App.3d at118, 92 Cal.Rptr. 851 (citing Cal. Civ. Code, 1495). Simply put, if the offeror "is without the money necessary to make the offer good and knows it" the tender is without legal force or effect. Karlsen, 15 Cal.App.3d at118, 92 Cal.Rptr. 851 (citing several cases). "It would be futile to set aside a foreclosure sale on the technical ground that notice was improper, if the party making the challenge did not first make full tender and thereby establish his ability to purchase the property." United States Cold Storage v. Great Western Savings & Loan Assn., 165 Cal.App.3d 1214, 1224, 212 Cal.Rptr. 232 (1985). "A cause of action 'implicitly integrated' with the irregular sale fails unless the trustor can allege and establish a valid tender." Arnolds Management, 158 Cal.App.3d at 579, 205 Cal.Rptr. 15. "It is settled in California that a mortgagor cannot quiet his title against the mortgagee without paying the debt secured." Shimpones v. Stickney, 219 Cal. 637, 649, 28 P.2d 673 (1934); see Mix v. Sodd, 126 Cal.App.3d 386, 390, 178 Cal.Rptr. 736 (1981) ("a [*14] mortgagor in possession may not maintain an action to quiet title, even though the debt is unenforceable"); Aguilar v. Bocci, 39 Cal.App.3d 475, 477, 114 Cal.Rptr. 91 (1974) (trustor is unable to quiet title "without discharging his debt"). Moreover, to obtain "rescission or cancellation, the rule is that the complainant is required to do equity, as a condition to his obtaining relief, by restoring to the defendant everything of value which the plaintiff has received in the transaction. . . . The rule applies although the plaintiff was induced to enter into the contract by the fraudulent representations of the defendant." Fleming v. Kagan, 189 Cal.App.2d 791, 796, 11 Cal.Rptr. 737 (1961). "A valid and viable tender of payment of the indebtedness owing is essential to an action to cancel a voidable sale under a deed of trust." Karlsen, 15 Cal.App.3d at 117, 92 Cal.Rptr. 851. Analyzing "trust deed nonjudicial foreclosure sales issues in the context of common law contract principles" is "unhelpful" given "the comprehensive statutory scheme regulating nonjudicial foreclosure sales." Residential Capital v. Cal-Western Reconveyance Corp., 108 Cal.App.4th 807, 820, 821, 134 Cal.Rptr.2d 162 (2003). "The [*15] rules which govern tenders are strict and are strictly applied." Nguyen v. Calhoun, 105 Cal.App.4th 428, 439, 129 Cal.Rptr.2d 436 (2003). "The tenderer must do and offer everything that is necessary on his part to complete the transaction, and must fairly make known his purpose without ambiguity, and the act of tender must be such that it needs

only acceptance by the one to whom it is made to complete the transaction." Gaffney v. Downey Savings & Loan Assn., 200 Cal.App.3d 1154, 1165, 246 Cal.Rptr. 421 (1988). The debtor bears "responsibility to make an unambiguous tender of the entire amount due or else suffer the consequence that the tender is of no effect." Gaffney, 200 Cal.App.3d at 1165, 246 Cal.Rptr. 421. TILA Turning to TILA, the "voiding of a security interest may be judicially conditioned on debtor's tender of amount due under the loan." American Mortgage Network, Inc. v. Shelton, 486 F.3d 815, 821 (4th Cir. 2007). 15 U.S.C. 1635(b) governs the return of money or property when a borrower has rescinded effectively: . . . Within 20 days after receipt of a notice of rescission, the creditor shall return to the obligor any money or property given as earnest money, downpayment, or [*16] otherwise, and shall take any action necessary or appropriate to reflect the termination of any security interest created under the transaction. If the creditor has delivered any property to the obligor, the obligor may retain possession of it. Upon the performance of the creditor's obligations under this section, the obligor shall tender the property to the creditor, except that if return of the property in kind would be impracticable or inequitable, the obligor shall tender its reasonable value. Tender shall be made at the location of the property or at the residence of the obligor, at the option of the obligor. If the creditor does not take possession of the property within 20 days after tender by the obligor, ownership of the property vests in the obligor without obligation on his part to pay for it. The procedures prescribed by this subsection shall apply except when otherwise ordered by a court. 12 C.F.R. 226.23(d) addresses rescission effects and provides: (2) Within 20 calendar days after receipt of a notice of rescission, the creditor shall return any money or property that has been given to anyone in connection with the transaction and shall take any action necessary to reflect [*17] the termination of the security interest. (3) If the creditor has delivered any money or property, the consumer may retain possession until the creditor has met its obligation under paragraph (d)(2) of this section. When the creditor has complied with that paragraph, the consumer shall tender the money or property to the creditor or, where the latter would be impracticable or inequitable, tender its reasonable value. At the consumer's option, tender of property may be made at the location of the property or at the consumer's residence. Tender of money must be made at the creditor's designated place of business. If the creditor does not take

possession of the money or property within 20 calendar days after the consumer's tender, the consumer may keep it without further obligation. (Bold added.) Neither TILA nor its Regulation Z, 12 C.F.R. 226, et seq., "'establishes that a borrower's mere assertion of the right of rescission has the automatic effect of voiding the contract.'" Yamamoto v. Bank of New York, 329 F.3d 1167, 1172 (9th Cir. 2003) (quoting Large v. Conseco Financing Servicing Corp., 292 F.3d 49, 54-55 (1st Cir. 2002)). The Ninth Circuit, relying on Large, explained: Instead, [*18] the "natural reading" of the language of 1635(b) "is that the security interest becomes void when the obligor exercises a right to rescind that is available in the particular case, either because the creditor acknowledges that the right of rescission is available, or because the appropriate decision maker has so determined. . . . Until such decision is made the [borrowers] have only advanced a claim seeking rescission." Yamamoto, 329 F.3d at 1172 (quoting Large, 292 F.3d at 54-55)). A rescission notice is not automatic "without regard to whether the law permits [borrower] to rescind on the grounds asserted." See Yamamoto, 329 F.3d at 1172. Entertaining rescission automatically "makes no sense . . . when the lender contests the ground upon which the borrower rescinds." Yamamoto, 329 F.3d at 1172. "In these circumstances, it cannot be that the security interest vanishes immediately upon the giving of notice. Otherwise, a borrower could get out from under a secured loan simply by claiming TILA violations, whether or not the lender had actually committed any." Yamamoto, 329 F.3d at 1172 (italics in original). Moreover, although 15 U.S.C. 1635(b) "provides for immediate voiding of the [*19] security interest and return of the money within twenty days of the notice of rescission, we believe this assumes that the notice of rescission was proper in the first place." In re Groat, 369 B.R. 413, 419 (Bankr. 8th Cir. 2007). A "court may impose conditions on rescission that assure that the borrower meets her obligations once the creditor has performed its obligations." Yamamoto, 329 F.3d at 1173. The Ninth Circuit has explained that prior to ordering rescission based on a lender's alleged TILA violations, a court may require borrowers to prove ability to repay loan proceeds: As rescission under 1635(b) is an on-going process consisting of a number of steps, there is no reason why a court that may alter the sequence of procedures after deciding that rescission is warranted, may not do so before deciding that rescission is warranted when it finds that, assuming grounds for rescission exist, rescission still could not be enforced because the borrower cannot comply with the borrower's rescission obligations no matter what. Such a decision lies within the court's equitable discretion, taking into consideration all the circumstances including the nature of the violations and the borrower's [*20] ability to repay the proceeds. If, as was the case here, it is clear from the evidence that the borrower lacks capacity to pay back what

she has received (less interest, finance charges, etc.), the court does not lack discretion to do before trial what it could do after. Yamamoto, 329 F.3d at 1173 (affirming summary judgment for lender in absence of evidence that borrowers could refinance or sell property); see American Mortgage, 486 F.3d at 821 ("Once the trial judge in this case determined that the [plaintiffs] were unable to tender the loan proceeds, the remedy of unconditional rescission was inappropriate."); LaGrone v. Johnson, 534 F.2d 1360, 1362 (9th Cir. 1974) (under the facts, loan rescission should be conditioned on the borrower's tender of advanced funds given the lender's nonegregious TILA violations and equities heavily favoring the lender).3 - - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - 3 The Fourth Circuit Court of Appeals agrees with the Ninth Circuit that 15 U.S.C. 1635(b) does not compel a creditor to remove a mortgage lien in the absence of the debtor's tender of loan proceeds: Congress did not intend to require a lender to relinquish its security interest when it is now known that the borrowers did not intend [*21] and were not prepared to tender restitution of the funds expended by the lender in discharging the prior obligations of the borrowers. Powers v. Sims & Levin, 542 F.2d 1216, 1221 (4th Cir. 1976). - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - Neither the complaint nor record references Mr. Madlaing's tender of indebtedness or credible ability to do so. The record's silence on Mr. Madlaing's tender of or ability to tender amounts outstanding is construed as his concession of inability to do so, especially considering his more than two years of remaining in default. Mr. Madlaing's failure to cure his default resulted in rightful acceleration of his loan's outstanding balance. Without Mr. Madlaing's meaningful tender, he seeks empty remedies, not capable of being granted. Granting Mr. Madlaing relief without his credible tender would be an unjustified windfall. Mr. Madlaing's points as to a void, as compared to voidable, sale are unavailing since he fails to demonstrate that equity excuses him from the tender rule, as explained further below in connection with his non-actionable claims. In addition, the complaint does not address conditions precedent to permit rescission even under TILA. The complaint is not a timely, valid rescission [*22] notice but nonetheless claims Mr. Madlaing is entitled to rescind his loan and requests to enjoin defendants to claim "any estate, right or interest in the subject property." "Clearly it was not the intent of Congress to reduce the mortgage company to an unsecured creditor or to simply permit the debtor to indefinitely extend the loan without interest." American Mortgage, 486 F.3d at 820-821. Without Mr. Madlaing's meaningful tender, his purported claims are doomed. Standing To Challenge Loan Securitization The complaint accuses defendants of wrongs in connection with the Pooling and Servicing Agreement ("PSA") in connection with Mr. Madlaing's loan. Defendants note that Mr. Madlaing lacks standing to enforce PSA terms in that he is neither

a party to the PSA nor an intended third-party beneficiary. See Armeni v. America's Wholesale Lender, 2012 WL 253967, p. at *2 (C.D. Cal. 2012) ("Because Plaintiff lacks standing to raise alleged breach of the Trust Agreement [PSA], to the extent his claims are based on breach of this agreement, the claims fail."); Bascos v. Federal Home Loan Mortg. Corp., 2011 WL 3157063, at *6 (C.D. Cal. 2011) ("To the extent Plaintiff challenges the securitization [*23] of his loan because Freddie Mac failed to comply with the terms of its securitization agreement, Plaintiff has no standing to challenge the validity of the securitization of the loan as he is not an investor of the loan trust."); see also In re Correia, 452 B.R. 319, 324 (1st Cir. BAP 2011) (where debtors asked court to declare mortgage assignment invalid based upon breach of PSA, a contract to which debtors were neither a party nor third-party beneficiaries, the court found that debtors lacked standing to object to any breaches of the PSA). Defendants are correct that Mr. Madlaing lacks standing to assert PSA-based claims and the complaint's claims fail to the extent based on wrongs in connection with the PSA and including such claims alleged under the complaint's first and second claims. Claims that the default notice "is false" based on wrongs in connection with the PSA are unavailing. This Court construes Mr. Madlaing's failure to support PSA-based claims as his concession that he lacks standing to pursue such claims. Robosigning Defendants further challenge as vague and conclusory allegations that several recorded documents were robosigned. See Cerecedes v. U.S. Bankcorp, 2011 WL 1666938, at *4 (C.D. Cal. 2011) [*24] ("generic allegations of robo-signing and other unspecified irregularities are insufficient to place defendants on notice of how defendants violated those statutes"); see Chua v. IB Property Holdings, LLC, 2011 WL 3322884, at *2 (C.D. Cal. 2011) ("Plaintiffs produced no information supporting their theory that Lisa Markham [who signed assignment and trustee substitution] is a 'robo signer'"). Defendants are correct that robosigning allegations fail to support actionable claims against defendants. Breach Of Express Agreements The complaint's (first) breach of express agreements claim accuses defendants of breaching the DOT. Elements "The standard elements of a claim for breach of contract are: '(1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) damage to plaintiff therefrom.'" Wall Street Network, Ltd. v. New York Times Co., 164 Cal.App.4th 1171, 1178, 80 Cal.Rptr.3d 6 (2008). "To form a contract, an 'offer must be sufficiently definite . . . that the performance promised is reasonably certain.'" Alexander v. Codemasters Group Limited, 104 Cal.App.4th 129, 141. 127 Cal.Rptr.2d 145 (2002). "Facts

alleging a breach, like all essential [*25] elements of a breach of contract cause of action, must be pleaded with specificity." Levy v. State Farm Mut. Auto. Ins. Co., 150 Cal.App.4th 1, 5, 58 Cal.Rptr.3d 54 (2007); see Bentley v. Mountain, 51 Cal.App.2d 95, 98, 124 P.2d 91 (1942) ("The allegations of the amended complaint to the effect that defendants 'violated' said contracts, or 'caused the violation' of said contracts by others, are mere conclusions of law which cannot strengthen the pleading in the absence of allegations of fact showing such violations"). Defendants challenge the complaint's failure to allege facts to support breach of contract elements based on DOT breaches. Foreclosure Compliance The complaint's (first) breach of contract claim appears to take issue with the DOT trustee's failure to record the default notice. It specifically alleges failure "to execute a proper written notice of the occurrence of an event of default and of Lender's election to cause the property to be sold by the true Lender or Trustee." Defendants point out that no DOT or statutory requirement requires the DOT trustee to conduct foreclosure. Under California law, a lender may pursue non-judicial foreclosure upon default with a deed of trust [*26] with a power of sale clause. "Financing or refinancing of real property is generally accomplished in California through a deed of trust. The borrower (trustor) executes a promissory note and deed of trust, thereby transferring an interest in the property to the lender (beneficiary) as security for repayment of the loan." Bartold v. Glendale Federal Bank, 81 Cal.App.4th 816, 821, 97 Cal.Rptr.2d 226 (2000). A deed of trust "entitles the lender to reach some asset of the debtor if the note is not paid." Alliance Mortgage Co. v. Rothwell, 10 Cal.4th 1226, 1235, 44 Cal.Rptr.2d 352 (1995). If a borrower defaults on a loan and the deed of trust contains a power of sale clause, the lender may non-judicially foreclose. See McDonald v. Smoke Creek Live Stock Co., 209 Cal. 231, 236-237, 286 P. 693 (1930). The California Court of Appeal has explained nonjudicial foreclosure under the applicable California Civil Code sections: The comprehensive statutory framework established to govern nonjudicial foreclosure sales is intended to be exhaustive. . . . It includes a myriad of rules relating to notice and right to cure. It would be inconsistent with the comprehensive and exhaustive statutory scheme [*27] regulating nonjudicial foreclosures to incorporate another unrelated cure provision into statutory nonjudicial foreclosure proceedings. Moeller v. Lien, 25 Cal.App.4th 822, 834, 30 Cal.Rptr.2d 777 (1994); see I.E. Assoc. v. Safeco Title Ins. Co., 39 Cal.3d 281, 285, 216 Cal.Rptr. 438 (1985) ("These provisions cover every aspect of exercise of the power of sale contained in a deed of trust.") Under California Civil Code section 2924(a)(1), a "trustee, mortgagee or beneficiary or any

of their authorized agents" may conduct the foreclosure process which "is commenced by the recording of a notice of default and election to sell by the trustee." Moeller, 25 Cal.App.4th at 830, 30 Cal.Rptr.2d 77. Under California Civil Code section 2924b(4), a "person authorized to record the notice of default or the notice of sale" includes "an agent for the mortgagee or beneficiary, an agent of the named trustee, any person designated in an executed substitution of trustee, or an agent of that substituted trustee." "Upon default by the trustor, the beneficiary may declare a default and proceed with a nonjudicial foreclosure sale." Moeller, 25 Cal.App.4th at 830, 30 Cal.Rptr.2d 777. Defendants note that LSI [*28] Title on behalf of QLS, as agent for the DOT beneficiary, executed the default notice on September 4, 2009 and that QLS properly recorded the default notice on September 9, 2009. The complaint's conclusory claims of purported breach of the DOT offer nothing to support a discrepancy in the foreclosure process. The "statutory provisions, because they broadly authorize a 'trustee, mortgagee, or beneficiary, or any of their authorized agents' to initiate a nonjudicial foreclosure ( 2924, subd. (a)(1), italics added), do not require that the foreclosing party have an actual beneficial interest in both the promissory note and deed of trust to commence and execute a nonjudicial foreclosure sale." Jenkins v. JP Morgan Chase Bank, N.A., Cal.Rptr.3d , 2013 WL 2145098, at *7 (2013). Claims that the default notice "is false" are unavailing. Compliance With California Civil Code Section 2923.5 Defendants challenge the breach of contract claim's allegations that the default notice was robosigned and that defendants failed to give proper notice prior to recording the default notice. Defendants point to the default notice's statement of compliance with California Civil Code section 2923.5 ("section 2923.5") [*29] that: The Beneficiary or its designated agent declares that it has contacted the borrower, tried with due diligence to contact the borrower as required by California Civil Code 2923.5, or the borrower has surrendered the property to the beneficiary or authorized agent, or is otherwise exempt from the requirements of 2923.5. Section 2923.5(a)(1) prohibits a mortgagee, trustee, beneficiary or authorized agent to "file a notice of default pursuant to Section 2924 until 30 days after initial contact is made as required by paragraph (2) or 30 days after satisfying the due diligence requirements as described in subdivision (g)." Section 2923.5(a)(2) requires a "mortgagee, beneficiary or authorized agent" to "contact the borrower in person or by telephone in order to assess the borrower's financial situation and explore options for the borrower to avoid foreclosure." Section 2923.5(b) requires a default notice to include a declaration "from the mortgagee, beneficiary, or authorized agent" of compliance with section 2923.5, including attempt "with due diligence to contact the borrower as required by this section." Defendants are correct that section 2923.5 does not require actual contact [*30] if a diligent attempt to contact is made. The default notice includes the requisite declaration to attest to efforts to comply with section 2923.5. The declaration tracks with section 2923.5 to satisfy

the statute. See Mabry v. Superior Court, 185 Cal.App.4th 208, 235, 110 Cal.Rptr.3d 201 (2010). Trustee Substitution The complaint's breach of contract claim further takes issue with robosigning the trustee substitution and DOT assignment. The claim further challenges the validity of Wells Fargo's September 4, 2009 execution of the trustee substitution prior to the October 28, 2009 recordation of the DOT assignment, which transferred beneficial interest under the DOT to Wells Fargo. Defendants note that on September 4, 2009, EMC Mortgage Corporation ("EMC"), as attorney in fact for Wells Fargo, executed the trustee substitution to substitute QLS as DOT trustee in place of original DOT trustee First American Title Company. Defendants point out that as attorney in fact for the DOT beneficiary, EMC was authorized to effectuate the trustee substitution. See Kachlon v. Markowitz, 168 Cal.App.4th 316, 334, 85 Cal.Rptr.3d 532 (2008) ("The beneficiary may make a substitution of trustee . . . to [*31] conduct the foreclosure and sale"). Turning to the DOT assignment, defendants explain that its recording was not required to assign the beneficial interest under the DOT. Defendants fault a claim based on California Civil Code section 2932.5 ("section 2932.5") in that section 2932.5 applies to mortgages, not a deed of trust such as that at issue here. California adopted the "lien" theory of mortgages and the "title" theory in reference to deeds of trust. Bank of Italy Nat. Trust & Sav. Ass'n v. Bentley, 217 Cal. 644, 655, 20 P.2d 940 (1933). Mortgages and deeds of trust "are fundamentally different in that in a mortgage only a 'lien' [is] created, while in a deed of trust 'title' actually passe[s] to the trustee." Bentley, 217 Cal. at 655, 20 P.2d 940. A "deed of trust differs from a mortgage in that title passes to the trustee in case of a deed of trust, while, in the case of a mortgage, the mortgagor retains title." Bentley, 217 Cal. at 655, 20 P.2d 940. A fellow district court has explained: A deed of trust generally involves three parties, the borrower/trustor . . . who conveys the right to sell the property to the trustee, for the benefit of the lender/beneficiary. . . . The practical [*32] effect is the creation of a lien on the subject property. . . . Notwithstanding that the right of sale is formally with the trustee, both the beneficiary and the trustee may commence the nonjudicial foreclosure process. Roque v. Suntrust Mortg., Inc., 2010 WL 546896, at *3 (N.D. Cal. 2010) (citation omitted). Section 2932.5 addresses mortgages and provides: Where a power to sell real property is given to a mortgagee, or other encumbrancer, in an instrument intended to secure the payment of money,

the power is part of the security and vests in any person who by assignment becomes entitled to payment of the money secured by the instrument. The power of sale may be exercised by the assignee if the assignment is duly acknowledged and recorded. Defendants are correct that section 2932.5 covers only mortgages in which the mortgagee has a power of sale. "Section 2932.5 applies to mortgages, not deeds of trust. It applies only to mortgages that give a power of sale to the creditor, not to deeds of trust which grant a power of sale to the trustee." Roque, 2010 WL 546896, at *3. The complaint's reliance on section 2932.5 is unavailing in that section 2932.5 does not apply to the facts subject to [*33] the complaint. Moreover, California's non-judicial foreclosure statutes do not require a recording of assignments of interests in deeds of trust prior to foreclosure. See Parcay v. Shea Mortgage, U.S. Dist. Lexis 40377, at *31 (E.D. Cal. 2010) ("There is no requirement under California law for an assignment to be recorded in order for an assignee beneficiary to foreclose."); Caballero v. Bank of America, 2010 WL 4604031, at *3 (N.D. Cal. 2010) (" 2932.5 does not require the recordation of an assignment of a beneficial interest for a deed of trust, as opposed to a mortgage"). Defendants are correct that the trustee substitution and DOT assignment establish that the beneficial interest in Mr. Madlaing's loan had been transferred to Wells Fargo prior to execution of the trustee substitution in that the trustee substitution was executed on Wells Fargo's behalf. In other words, when Wells Fargo executed the trustee substitution, it held the beneficial interest in Mr. Madlaing's loan. Delay to record the trustee substitution does not establish that Wells Fargo did not hold the loan's beneficial interest when the trustee was substituted. Under California Civil Code section 2934a(d), "[o]nce [*34] recorded, the substitution [of trustee] shall constitute conclusive evidence of the authority of the substituted trustee or his or her agents to act pursuant to this section." The complaint lacks a viable claim based on alleged DOT breach, especially considering the absence of limitation on the power of sale. The complaint's (first) breach of express agreements claim is subject to dismissal. Breach Of Implied Agreements The complaint's (second) breach of implied agreements claim alleges defendants invoked the DOT's power of sale without notice required by the DOT. "An implied contract is one, the existence and terms of which are manifested by conduct." Cal. Civ. Code, 1621. Like an express contract, an implied contract requires "a meeting of the minds or an agreement." Mulder v. Mendo Wood Products, Inc., 225 Cal.App.2d 619, 632, 37 Cal.Rptr. 479 (1964). "As to the basic elements, there is no difference between an express and implied contract. While an express contract is defined as one, the terms of which are stated in words (Civ. Code, 1620), an implied contract is an agreement, the existence and terms of which are manifested by conduct (Civ. Code, 1621)." Division of Labor Law Enforcement v. Transpacific Transportation Co., 69 Cal.App.3d 268, 275, 137

Cal.Rptr. 855 (1977). [*35] "The true implied contract consists of obligations arising from a mutual agreement and intent to promise where the agreement and promise have not been expressed in words." Mulder, 225 Cal.App.2d at 632, 37 Cal.Rptr. 479. The breach of implied agreements claim is based on the same allegations as the breach of express agreements claim. Despite the slightly different theory, the breach of implied agreements claim fails for the same reasons as the breach of express agreements claim. As discussed above, no actionable claims arise from the default notice or trustee substitution, including their contents or authority to enforce or record them. The breach of implied agreements claim fails along side the breach of express agreements claim. Slander Of Title The complaint's (third) slander of title further takes issue with validity of foreclosure documents. Defendants fault the complaint's absence of facts to support slander of title. Elements "Slander of title occurs when there is an unprivileged publication of a false statement which disparages title to property and causes pecuniary loss." ... [Message clipped] View entire message

DOUGLAS AND JULIE ALSOBROOK, Plaintiffs, vs. AMERICAN HOME MORTGAGE et al., Defendants. CASE NO. 12-cv-2151-GPC-WMC UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF CALIFORNIA 2013 U.S. Dist. LEXIS 76196

May 30, 2013, Decided May 30, 2013, Filed CORE TERMS: foreclosure, mortgage, promissory note, deed of trust, quiet, Deed, securitization, standing to challenge, assigned, declaratory relief, failed to state, notice, factual allegations, power of sale, recorded, judicial notice, fail to state, real property, transferred, nonjudicial, beneficial, foreclose, borrower, lender, default, legal theory, declaratory judgments, failed to properly, reasonable inference, adverse claims

COUNSEL: [*1] Douglas Alsobrook, Plaintiff, Pro se, La Mesa, CA. Julie Alsobrook, Plaintiff, Pro se, San Diego, CA. For Saxon Mortgage, Defendant: Bradford E. Klein, LEAD ATTORNEY, Wright, Finlay & Zak, LLP, Newport Beach, CA. For Ocwen Loan Servicing, Mortgage Electronic Registration Systems, Inc., (MERS), Defendants: Rachel Suzanne Opatik, LEAD ATTORNEY, Houser & Allison, APC, Carlsbad, CA. JUDGES: HON. GONZALO P. CURIEL, United States District Judge. OPINION BY: GONZALO P. CURIEL OPINION ORDER GRANTING DEFENDANTS' MOTIONS TO DISMISS [DKT. NO. 22] I. INTRODUCTION On March 15, 2013, Defendants Mortgage Electronic Registration Systems, Inc. ("MERS") and Ocwen Loan Servicing filed a motion to dismiss Plaintiffs' first amended complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (Dkt. No. 22.) On March 27, 2013 Defendant Saxon Mortgage filed a notice joining aforementioned motion. (Dkt. No. 24.) For the reasons set out below, the Court hereby GRANTS Defendants' motion to dismiss without prejudice. II. BACKGROUND On May 31, 2007, Plaintiffs Douglas and Julie Alsobrook completed a loan for the property located at 4075 Bancroft Drive, La Mesa, California 91941 and the promissory note was secured by a Deed of Trust.1 The Deed of [*2] Trust lists MERS as "the beneficiary under this Security Instrument," American Home Mortgage as the lender, and Lawyer's Title as the trustee. On February 12, 2010, a notice of default and election to sell under deed of trust was filed in San Diego County, which showed that Plaintiffs were in default on the aforementioned loan in the amount of $18,309.78. (Dkt. No. 23, Ex. 2 "Notice of Default.") On March 16, 2010, MERS assigned all of its rights, title and interest in the Deed of Trust to Saxon Mortgage Services, inc. (Dkt. No. 23, Ex. 3 "Assigned of Deed of Trust.") On June 14, 2012, a notice of sale was recorded by the Trustee, setting a sale date for July 10, 2012 and indicating an unpaid obligation of $335,426.42. (Dkt. No. 23, Ex. 6 "Notice of Sale.") The sale date has been postponed by oral proclamation. (Dkt. No. 23 at 2, "Statement of Facts.")

- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -

1 Pursuant to Federal Rules of Evidence, Rule 201, Defendants have requested the Court take judicial notice of legal documents underpinning Plaintiffs' entire action. As Plaintiffs' complaint fails to provide the relevant facts regarding the foreclosure of their property in question, the Court, having reviewed the exhibits, finds that [*3] the information can be accurately and readily determined from reliable sources. Accordingly, the Court takes judicial notice of Defendants MERS and Ocwen exhibits 1-6. See Dkt. No. 23. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - On August 31, 2012, Plaintiffs brought this pro se action alleging wrongful foreclosure and fraud, seeking injunction and declaratory relief to prevent the foreclosure of their property and seeking to void the Deed of Trust and to quiet title. (Dkt. No. 1.) On February 12, 2013, this Court granted Defendant's motion to dismiss without prejudice and granted Plaintiffs leave to file an amended complaint. (Dkt. No. 20.) On February 26, 2013, Plaintiffs filed a first amended complaint. (Dkt. No. 21, "FAC.") The FAC alleges wrongful foreclosure and seeks to quiet title and declaratory relief. (Id.) Plaintiffs assert American Home Mortgage improperly transferred or assigned the promissory note related to their property. (FAC 17-23.) Plaintiffs allege American Home Mortgage failed to properly transfer the deed of trust to the REMIC Trust resulted in a violation of the Pooling and Servicing Agreement. (FAC 24-25.) According to Plaintiffs, American Home Mortgage failed to physically deliver the promissory [*4] note to an unnamed REMIC trust and therefore "the Deed of Trust is rendered a nullity [since] the Promissory Note itself is not also transferred." (FAC 32.) Moreover, Plaintiffs assert that because American Mortgage failed to properly transfer the promissory note and as American Mortgage is now out of business, neither REMIC Trust nor Ocwen Loan Servicing have the legal right to collect mortgage payments from Plaintiffs. (FAC 43.) Plaintiff further alleges wrongful foreclosure based on the theory that Defendants do not have standing to foreclose on the property because MERS improperly assigned the interest under the Deed of Trust. (FAC 50-52.) Plaintiffs also assert Defendants have failed to comply with California Civil Code 2932.5 because there was no recorded assignment of deed of trust. (FAC 53-56.) Defendants Ocwen Loan Servicing and Mortgage Electronic Registration Systems, Inc. ("MERS") move to dismiss Plaintiffs' first amended complaint. (Dkt. No. 22.) Defendants contend Plaintiffs fail to state a claim for wrongful foreclosure as a matter of law. (Dkt. No. 22 at 2.) Defendants further argue that Plaintiffs lack standing to challenge securitization of their loan [*5] and lack standing to challenge the wrongful foreclosure based on the MERS assignment. (Id. at 3-5.) Defendants also contend Plaintiff has failed to state a claim to quiet title and declaratory relief. (Id. at 5-6.) III. LEGAL STANDARD A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the sufficiency of a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). Dismissal is warranted under Rule12(b)(6) where the complaint lacks a cognizable legal theory. Robertson v. Dean

Witter Reynolds, Inc., 749 F.2d 530, 534 (9th Cir. 1984); see Neitzke v. Williams, 490 U.S. 319, 326, 109 S. Ct. 1827, 104 L. Ed. 2d 338 (1989) ("Rule12(b)(6) authorizes a court to dismiss a claim on the basis of a dispositive issue of law."). Alternatively, a complaint may be dismissed where it presents a cognizable legal theory yet fails to plead essential facts under that theory. Robertson, 749 F.2d at 534. While a plaintiff need not give "detailed factual allegations," a plaintiff must plead sufficient facts that, if true, "raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 545, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted [*6] as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009) (quoting Twombly, 550 U.S. at 547). A claim is facially plausible when the factual allegations permit "the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. In other words, "the non-conclusory 'factual content,' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. Secret Service, 572 F.3d 962, 969 (9th Cir. 2009). "Determining whether a complaint states a plausible claim for relief will . . . be a contextspecific task that requires the reviewing court to draw on its judicial experience and common sense." Iqbal, 556 U.S. at 679. In reviewing a motion to dismiss under Rule 12(b)(6), the court must assume the truth of all factual allegations and must construe all inferences from them in the light most favorable to the nonmoving party. Thompson v. Davis, 295 F.3d 890, 895 (9th Cir. 2002); Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). Legal conclusions, however, need not be taken as true merely because they are cast in the [*7] form of factual allegations. Ileto v. Glock, Inc., 349 F.3d 1191, 1200 (9th Cir. 2003); W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). When ruling on a motion to dismiss, a court may consider the facts alleged in the complaint, documents attached to the complaint, documents relied upon but not attached to the complaint when authenticity is not contested, and matters of which the court takes judicial notice. Lee v. Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001). IV. DISCUSSION A. Quiet Title Plaintiffs have failed to state a claim to quiet title. Under California Code of Civil Procedure, Plaintiffs are required to state: (a) a legal description of the real property and its street address, (b) Title as to which a determination is sought and the basis of the title, (c) adverse claims to the title, (d) the date as to which the determination is sought, and (e) a prayer for the determination of the title of the Plaintiff against the adverse claims. Cal. Civ. Pro. Code 761.020. Moreover, to quiet title the debt must be discharged. Aguilar v. Bocci, 39 Cal. App. 3d 475, 477, 114 Cal. Rptr. 91 (1979)("[A]ppellant can[not] quiet title without discharging his debt . . . the cloud upon his title [*8] persists until the debt is paid")(internal citations omitted). Here, Plaintiffs allege that because American Home Mortgage did not properly sell or transfer the promissory note no party can enforce the terms of the loan and Plaintiffs have no further debt obligations on the loan. (FAC 38, 47.) This allegation fails to state a proper claim to quiet title. Plaintiffs allegations do not establish who has legal

basis to the title nor do Plaintiffs show the discharge of loan debt. As such, Plaintiffs fail to state a claim to quiet title. B. Wrongful Foreclosure Defendants assert Plaintiffs lack standing to challenge securitization of their loan, and therefore cannot state a claim for wrongful disclosure. (Dkt. No. 22 at 3-4.) Plaintiffs do not challenge these arguments in their response. (Dkt. No. 25.) The Court finds Plaintiffs lack standing to challenge the securitization of their loan. As an initial matter, Plaintiffs allege the Defendants do not have authority to foreclose on their home. Courts have rejected similar claims that corporations do not have the authority to foreclose because the original mortgage lender "improperly" packaged and sold the original loan. Lane v. Vitek Real Estate Industries Group, 713 F.Supp. 2d 1092 (E.D. Cal. 2010)("The [*9] argument that parties lose interest in a loan when it is assigned to a trust pool has also been rejected by numerous district courts."); Benham v. Aurora Loan Services, 2009 U.S. Dist. LEXIS 78384, 2009 WL 2880232 at *3 (N.D. Cal. Sept.1, 2009) ("Other courts in this district have summarily rejected the argument that companies like MERS lose their power of sale pursuant to the deed of trust when the original promissory note is assigned to a trust pool."). Here, Plaintiffs allege the "transfer of beneficial ownership in the Deed of Trust to any third party as result of the execution of said assignment by MERS or any agent of MERS is invalid." (FAC 52.) The Court finds the allegation is baseless and fails to properly state a wrongful foreclosure claim. Moreover, Plaintiffs have not asserted that they are party to the loan securitization agreement. Courts have also rejected claims challenging foreclosure when Plaintiffs are not a party to the securitization agreement. Bascos v. Fed. Home Loan Mortgage Corp., CV 113968-JFW JCX, 2011 U.S. Dist. LEXIS 86248, 2011 WL 3157063 (C.D. Cal. July 22, 2011)("Plaintiff has no standing to challenge the validity of the securitization of the loan as he is not an investor of the loan trust"). Courts have [*10] also held that homeownerplaintiff lacks standing when challenging the assignment of a deed of trust because "only someone who suffered a concrete and particularized injury that is fairly traceable to the substitution can bring an action to declare the assignment . . . void." Carollo v. Vericrest Fin., Inc., 2012 U.S. Dist. LEXIS 137017, 2012 WL 4343816 (N.D. Cal. Sept. 21, 2012) (citing Javaheri v. JPMorgan Chase Bank, N.A., 2012 U.S. Dist. LEXIS 114510, 2012 WL 3426278 at *6 (C.D. Cal. Aug. 13, 2012). Plaintiffs FAC does not allege that they were party to the loan securitization agreement nor have they asserted such a "concrete or particularized injury" related to the transfer of the promissory note. As such, the Court finds Plaintiffs lack to standing to challenge the securitization of their loan. As an additional matter, California courts have rejected the "holder of note" theory that Plaintiffs rely upon. In essence, Plaintiffs argue that American Home Mortgage improperly sold and transferred the promissory note, and therefore there is no ability to determine the actual holder of the note. California's nonjudicial foreclosure scheme is set forth in California Civil Code sections 2924 through 2924k, which "provide a comprehensive framework [*11] for the regulation of a nonjudicial foreclosure sale pursuant to a power of

sale contained in a deed of trust." Moeller v. Lien, 25 Cal.App. 4th 822, 830, 30 Cal. Rptr. 2d 777 (1994). California appellate courts have "refused to read any additional requirements into the non-judicial foreclosure statute." Id. at 830. The California Superior court recently affirmed this approach in Gomes v. Countrywide Home Loans, Inc., stating "the recognition of the right to bring a lawsuit to determine a nominee's authorization to proceed with foreclosure on behalf of the noteholder would fundamentally undermine the nonjudicial nature of the process and introduce the possibility of lawsuits filed solely for the purpose of delaying valid foreclosures." Gomes, 192 Cal. App. 4th 1149, 1155, 121 Cal. Rptr. 3d 819 (2011), review denied (May 18, 2011). To the extent that Plaintiffs rely upon this theory, the wrongful foreclosure claim also fails. C. Failure to Comply with California Civil Code 2932.5 Plaintiff has not sufficiently alleged Defendants have violated California Civil Code 2932.5. This section provides: "Where a power to sell real property is given to a mortgagee, or other encumbrancer, in an instrument intended to secure the payment [*12] of money, the power is part of the security and vests in any person who by assignment becomes entitled to payment of the money secured by the instrument. The power of sale may be exercised by the assignee if the assignment is duly acknowledged and recorded." Cal. Civ. Code 2932.5. Lenders must contact the borrower by phone or in person to "assess the borrower's financial situation and explore options for the borrower to avoid foreclosure." Here, Plaintiffs allege Defendants have not complied with Cal. Civ. C. 2932.5 for failure to record a document in the "public chain of title reflecting from whom it acquired the beneficial interest in Plaintiffs' Deed of Trust." (FAC 56.) Defendants argue that 2932.5 is inapplicable to deeds of trust. (Dkt. No. 22 at 5.) Plaintiffs fail to allege violation of Cal. Civ. Code 2932.5. "It has been established since 1908 that this statutory requirement that an assignment of the beneficial interest in a debt secured by real property must be recorded in order for the assignee to exercise the power of sale applies only to a mortgage and not to a deed of trust. Calvo v. HSBC Bank USA, N.A., 199 Cal. App. 4th 118, 122, 130 Cal. Rptr. 3d 815 (2011), review denied (Jan. [*13] 4, 2012). Here, Plaintiffs allegations are entirely based on the improper transfer of the deed of trust, on the underlying mortgage that created the lien. As such, the Court finds Plaintiff has failed to state a violation of Cal. Civ. Code 2932.5. D. Declaratory Relief The Declaratory Judgment Act, 28 U.S.C. 2201, provides that federal courts may issue declaratory judgments only in cases of an "actual controversy." 28 U.S.C. 2201. For similar reasons as previously discussed, Plaintiffs have failed to state an "actual controversy" exists for purposes of 28 U.S.C. 2201 (a). As such, the Court finds Plaintiffs have failed to state a claim for declaratory relief. IV. CONCLUSION For the foregoing reasons, Defendants motion to dismiss is GRANTED WITHOUT

PREJUDICE. Plaintiffs are granted LEAVE TO AMEND the complaint thirty (30) days from the date of this order to address deficiencies noted herein. Defendants are granted twenty (20) days from the date of service of plaintiff's second amended complaint to file a response thereto. Accordingly, the Court hereby VACATES the hearing date scheduled for Friday, May 31, 2013. IT IS SO ORDERED. DATED: May 30, 2013 /s/ Gonzalo P. Curiel HON. GONZALO [*14] P. CURIEL United States District Judge
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BRUCE A. MULLINS & WORLANDA F. MULLINS, Plaintiffs, v. WELLS FARGO BANK, N.A., Defendant. No. 2:13-cv-0453 JAM KJN PS UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA 2013 U.S. Dist. LEXIS 74792

May 24, 2013, Decided

May 28, 2013, Filed CORE TERMS: notice, judicial notice, equitable tolling, savings bank, deed of trust, limitations period, fraud claims, time barred, mortgage, misrepresentation, rescission, discover, leave to amend, statute of limitations, disclosures, securitization, modification, consummation, fraudulent, recorded, loan transaction, specific facts, origination, misconduct, preemption, preempted, default, savings, loan documents, public records

COUNSEL: [*1] Bruce A. Mullins, Plaintiff, Pro se, Vallejo, CA. Worlanda F. Mullins, Plaintiff, Pro se, Vallejo, CA. For Wells Fargo Bank, N.A., Defendant: David Michael Newman, AFRCT, LLP, Pasadena, CA. JUDGES: KENDALL J. NEWMAN, UNITED STATES MAGISTRATE JUDGE. OPINION BY: KENDALL J. NEWMAN OPINION ORDER Plaintiffs Bruce A. Mullins and Worlanda F. Mullins, proceeding without counsel, initially commenced this action in the Solano County Superior Court on January 30, 2013, asserting several federal and state law claims related to their residential home loan against defendant Wells Fargo Bank, N.A., successor by merger with Wells Fargo Bank Southwest, N.A., formerly known as Wachovia Mortgage, FSB, formerly known as World Savings Bank, FSB ("Wells Fargo "). (See Complaint, Ex. A to Notice of Removal, ECF

No. 1 at 18-36, ["Compl."].) 1 Thereafter, on March 6, 2013, Wells Fargo removed the action to this court, invoking the court's federal question and diversity of citizenship jurisdiction. (ECF No. 1.) 2

- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - 1 This case proceeds before the undersigned pursuant to E.D. Cal. L.R. 302(c)(21) and 28 U.S.C. 636(b)(1).2 Given that plaintiffs' complaint raises several federal claims, it clearly confers the court with federal question jurisdiction [*2] upon removal. Thus, at least at this juncture, the court need not determine whether it also has diversity jurisdiction over the action. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -

Subsequently, on March 20, 2013, Wells Fargo filed the instant motion to dismiss plaintiffs' complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (ECF No. 7.) The motion was initially noticed for hearing on May 2, 2013, but the hearing was later continued to May 23, 2013, on the court's own motion. (ECF Nos. 7, 9.) On May 8, 2013, plaintiffs filed an opposition to the motion, and Wells Fargo (ECF. Nos. 10, 11.) filed a reply brief on May 9, 2013.

At the hearing on May 23, 2013, plaintiff Bruce A. Mullins appeared on behalf of himself and his wife, plaintiff Worlanda F. Mullins, who was absent for medical reasons. Attorney David Newman appeared telephonically on behalf of Wells Fargo. After considering the parties' briefs, the parties' oral arguments, and the applicable law, the court grants Wells Fargo's motion to dismiss with leave to amend.

BACKGROUND The background facts are taken from plaintiffs' operative complaint and certain public that are subject to judicial records and government documents offered by Wells Fargo 3 notice. According [*3] to a deed of trust dated October 6, 2006, and recorded on October
4 13, 2006, plaintiffs borrowed $446,000.00 from World Savings Bank, FSB, pursuant to a written promissory note and secured by a deed of trust on real property located at 3017 Overlook Drive, Vallejo, California (the "Property"), where plaintiffs currently reside. (See

Compl. 1; Wells Fargo's Request for Judicial Notice, ECF No. 8 ["RJN"], Ex. A.) 5 Plaintiffs allege that, although they met the credit criteria for a prime fixed rate mortgage loan, World Savings (now Wells Fargo ), in events leading up to the origination of the loan, recommended that plaintiffs instead opt for a "Pick-A-Pay" adjustable rate mortgage loan, suggesting that after plaintiffs' credit rating increased over a couple of years, plaintiffs could refinance for an exceptional prime rate. (Compl. 3-4.)

- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - 3 The court's analysis with respect to Wells Fargo's request for judicial notice in support of its motion to dismiss (ECF No. 8) is set forth in the "Discussion" section below.4 World Savings Bank, FSB later changed its name to Wachovia Mortgage, FSB, and Southwest, N.A. before

then underwent a second name change to Wells Fargo Bank

merging with Wells [*4] Fargo Bank, N.A. (Wells Fargo's Request for Judicial Notice, ECF No. 8, Ex. B.)5 By contrast, plaintiffs' complaint alleges that they borrowed $350,000.00 from World Savings, with a cash down payment of $100,000, and that a deed of trust was issued around April 4, 2003, and recorded around April 11, 2003. (Compl. 3.) Neither Wells Fargo nor plaintiffs addressed the discrepancies with respect to the dates and amounts in their briefing. However, at the hearing, plaintiff Bruce Mullins clarified that a new deed of trust was issued in 2006 based on a loan modification. As such, it appears that the 2006 deed of trust, of which Wells Fargo requested judicial notice, supplanted the 2003 deed of trust. In any amended complaint, although plaintiffs may set forth facts concerning the history of their loan since 2003 to the extent that they are relevant to this case, plaintiffs shall also include facts regarding issuance of the operative 2006 deed of trust on which their claims are based. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - According to plaintiffs, they subsequently began to experience difficulties in affording their monthly payments when the mortgage interest rate increased on a cyclical basis, and the value of the Property also [*5] significantly diminished. (Compl. 4.) Plaintiffs were apparently at one point offered a one-year trial modification of the loan, and were thereafter presented with two (2) Loan Modification Options with incremental payment adjustments and optional balloon payments. (Id.) Plaintiffs assert that the proposed modified principal balances under these options provided them with no credit for monthly payments made over several past years, and that they would never realize any equity value in their home. (Id.) had no intent of actually providing plaintiffs Plaintiffs generally assert that Wells Fargo with a meaningful loan modification. (Id. 33.) Additionally, plaintiffs claim that despite Wells Fargo reassuring them that they were getting a loan modification, Wells Fargo

was also actively foreclosing on the Property. (Id. 34.) In that regard, plaintiffs further allege that Wells Fargo issued a Notice of Default around July 2009, without first contacting plaintiffs to explore options to avoid foreclosure in accordance with California Civil Code section 2923.5. (Id. 43-46.) Plaintiffs also state that a mortgage loan forensic analysis and audits have revealed a number of procedural improprieties [*6] with respect to the loan origination process, including with respect to certain statements, notices, disclosures, and booklets that were either not in the loan file, not provided to plaintiffs, or were not dated and signed properly. (Compl. 7-15, 17.) Plaintiffs state that they did not understand the loan documents they were signing and that they were not encouraged to read them. (Id. 16.) Plaintiffs further include vague allegations regarding "Improper Securitization" of the loan/note and "Improper Assignment" of the mortgage or deed of trust. (Id. 18.)

Based on these allegations, plaintiffs assert the following seven causes of action for: (1) fraudulent inducement to breach of contract; (2) violation of the federal Truth in Lending Act, 15 U.S.C. 1601 et seq. ("TILA"); (3) fraud and conspiracy to commit fraud; (4) violation of California Civil Code section 2923.5; (5) predatory lending in violation of TILA; (6) unlawful business practices in violation of California Business and Professions Code section 17200, predicated on violation of California Civil Code section 2923.5; and (7) fraudulent business practices in violation of California Business and Professions Code section 17200, [*7] predicated on violation of California Civil Code section 2923.5. (Compl. 19-66.) Liberally construed, plaintiffs' complaint, in addition to these explicitly stated causes of action, also purports to assert claims for violation of the Real Estate Settlement Procedures Act, 12 U.S.C. 2601 et seq. ("RESPA") and the Equal Credit Opportunity Act, 15 U.S.C. 1691 et seq. ("ECOA"). (See, e.g., Compl. 7-15.) As noted above, after removing the action to federal court, Wells Fargo motion to dismiss. DISCUSSION Legal Standard A motion to dismiss brought pursuant to Federal Rule of Civil Procedure 12(b)(6) challenges the sufficiency of the pleadings set forth in the complaint. Vega v. JPMorgan Chase Bank, N.A., 654 F. Supp. 2d 1104, 1109 (E.D. Cal. 2009). Under the "notice pleading" standard of the Federal Rules of Civil Procedure, a plaintiff's complaint must provide, in part, a "short and plain statement" of plaintiff's claims showing entitlement to relief. Fed. R. Civ. P. 8(a)(2); see also Paulsen v. CNF, Inc., 559 F.3d 1061, 1071 (9th Cir. 2009). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim [*8] to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007)). "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. In considering a motion to dismiss for failure to state a claim, the court accepts all of the facts alleged in the complaint as true and construes them in the light most favorable to the plaintiff. Corrie v. Caterpillar, Inc., 503 F.3d 974, 977 (9th Cir. 2007). The court is "not, however, required to accept as true conclusory allegations that are contradicted by documents referred to in the complaint, and [the court does] not necessarily assume the truth of legal conclusions merely because they are cast in the form of factual allegations." Paulsen, 559 F.3d at 1071. The court must construe a pro se pleading liberally to determine if it states a claim and, prior to dismissal, tell a plaintiff of deficiencies in his complaint and give plaintiff an opportunity to cure them if it appears at all possible that the plaintiff can correct the defect. See Lopez v. Smith, 203 F.3d 1122, 1130-31 (9th Cir. 2000) [*9] (en banc); accord Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990) (stating that "pro se pleadings are liberally construed, particularly where civil rights claims are involved"); see also Hebbe v. Pliler, 627 F.3d 338, 342 & n.7 (9th Cir. 2010) (stating that filed the instant

courts continue to construe pro se filings liberally even when evaluating them under the standard announced in Iqbal). In ruling on a motion to dismiss filed pursuant to Rule 12(b)(6), the court "may generally consider only allegations contained in the pleadings, exhibits attached to the complaint, and matters properly subject to judicial notice." Outdoor Media Group, Inc. v. City of Beaumont, 506 F.3d 895, 899 (9th Cir. 2007) (citation and quotation marks omitted). Although the court may not consider a memorandum in opposition to a defendant's motion to dismiss to determine the propriety of a Rule 12(b)(6) motion, see Schneider v. Cal. Dep't of Corrections, 151 F.3d 1194, 1197 n.1 (9th Cir. 1998), it may consider allegations raised in opposition papers in deciding whether to grant leave to amend, see, e.g., Broam v. Bogan, 320 F.3d 1023, 1026 n.2 (9th Cir. 2003). With these principles in mind, the court now [*10] turns to Wells Fargo's dismiss. Wells Fargo's Request for Judicial Notice motion to

After reviewing Wells Fargo's request for judicial notice in support of its motion to dismiss, the court grants it in part and denies it in part. "The court may judicially notice a fact that is not subject to reasonable dispute because it: (1) is generally known within the trial court's territorial jurisdiction; or (2) can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." Fed. R. Evid. 201(b). A court may take judicial notice of "matters of public record." Lee v. City of Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001). The court takes judicial notice of Exhibit A to the request for judicial notice, a deed of trust dated October 6, 2006, because it was recorded in the official records of the Solano County Recorder's office and is thus a public record whose accuracy cannot reasonably be questioned. For the same reasons, the court also takes judicial notice of Exhibit B to the request for judicial notice, which consists of various certificates, letters, and other official documents from government agencies and government websites, including the Office of [*11] Thrift Supervision in the Department of Treasury, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation. However, the court declines to take judicial notice of Exhibit C, which is a Property Profile Report from Chicago Title Company, purportedly showing that no Notice of Default has been recorded against the Property. Although Wells Fargo contends that this document is a "document reflecting official acts of the executive branch of the County of Alameda," whose authenticity is not subject to reasonable dispute, (ECF No. 8 at 3), the document itself is neither an official government document nor a recorded public record, but instead a record from a private company. As such, it is not the proper subject of judicial notice. TILA Claims (Causes of Action Two and Five)

In support of their TILA claims, plaintiffs allege that Wells Fargo violated TILA by failing to provide plaintiffs with certain required disclosures and/or notices at the time of the loan's origination. (Compl. 8-10, 27.) Wells Fargo time barred. argues that any TILA claim is

Any action for damages under TILA must generally be brought within one year of the consummation of the loan transaction. [*12] See 15 U.S.C. 1640(e); Meyer v. Ameriquest Mortgage Co., 342 F.3d 899, 902 (9th Cir. 2003); King v. California, 784 F.2d 910, 913 (9th Cir. 1986). Any action for rescission under TILA must be brought within three years of the consummation of the loan transaction. See 15 U.S.C. 1635(f)("An obligor's right of rescission shall expire three years after the date of consummation of the transaction...."); 12 C.F.R. 226.2(a)(13) ("Consummation means the time that a consumer becomes contractually obligated on a credit transaction"); see also King, 784 F.2d at 913. In this case, the transaction was consummated in October 2006 (RJN, Ex. A), and plaintiffs only commenced this action in 2013. As such, plaintiffs' TILA claims are time barred absent the proper invocation of equitable tolling. Wells Fargo correctly notes that the three-year limitations period for a rescission claim under TILA is absolute and not subject to equitable tolling. See Beach v. Ocwen Federal Bank, 523 U.S. 410, 412, 118 S. Ct. 1408, 140 L. Ed. 2d 566 (1998) (" 1635(f) completely extinguishes the right of rescission at the end of the 3-year period."); Miguel v. Country Funding Corp., 309 F.3d 1161, 1164 (9th Cir. 2002) (holding that " 1635(f) is a statute [*13] of repose, depriving the courts of subject matter jurisdiction when a 1635 claim is brought outside the three-year limitation period."); King, 784 F.2d at 913 (holding that TILA claim for rescission of home loan was barred by the "three-year absolute limitation on rescission actions" set out in 15 U.S.C. 1635(f)). Therefore, any claim for rescission under TILA should be dismissed and cannot be cured by further amendment. By contrast, the one-year limitations period for damages claims under TILA is not absolute. In King, the Ninth Circuit Court of Appeals held as follows: [W]e hold that the limitations period in Section 1640(e) runs from the date of consummation of the transaction but that the doctrine of equitable tolling may, in the appropriate circumstances, suspend the limitations period until the borrower discovers or had reasonable opportunity to discover the fraud or nondisclosures that form the basis of the TILA action. Therefore, as a general rule the limitations period starts at the consummation of the transaction. The district courts, however, can evaluate specific claims of fraudulent concealment and equitable tolling to determine if the general rule would be unjust or [*14] frustrate the purposes of the Act and adjust the limitations period accordingly.

King, 784 F.2d at 915. "Equitable tolling is generally applied in situations where the claimant has actively pursued his judicial remedies by filing a defective pleading during the statutory period, or where the complainant has been induced or tricked by his adversary's misconduct into allowing the filing deadline to pass." O'Donnell v. Vencor, Inc., 465 F.3d 1063, 1068 (9th Cir. 2006) (citation and quotation marks omitted). "Equitable tolling may be applied if, despite all due diligence, a plaintiff is unable to obtain vital information bearing on the existence of his claim...If a reasonable plaintiff would not have known of the existence of a possible claim within the limitations period, then equitable tolling will serve to extend the statute of limitations for filing suit until the plaintiff can gather what information he needs." Santa Maria v. Pacific Bell, 202 F.3d 1170, 1178 (9th Cir. 2000) (overruled on other grounds) (citation and quotation marks omitted). In Meyer, the Ninth Circuit explained that the mere fact that required disclosures under TILA were not made, or were insufficient for purposes [*15] of TILA, is not in itself enough to apply equitable tolling: The failure to make the required disclosures occurred, if at all, at the time the loan documents were signed. The [plaintiffs] were in full possession of all information relevant to the discovery of a TILA violation and a 1640(a) damages claim on the day the loan papers were signed. The [plaintiffs] have produced no evidence of undisclosed credit terms, or of fraudulent concealment or other action on the part of [the lender] that prevented the [plaintiffs] from discovering their claim. Meyer, 342 F.3d at 902. As another district court reasoned: Assuming, for purposes of the motions before the court, that [the lender's] acts violated TILA, plaintiff had the information he needed to discover and bring an action regarding the alleged wrongs more than three years before filing suit...Nothing in the [operative complaint] suggests that plaintiff was prevented from comparing his loan documents and disclosures with TILA statutory and regulatory requirements. See Hubbard v. Fidelity Federal Bank, 91 F.3d 75, 79 (9th Cir. 1996). Nor did plaintiff plead facts demonstrating that equitable tolling is warranted under the circumstances, [*16] such as facts showing that he actively pursued his judicial remedies by filing a defective pleading during the statutory period, was induced or tricked by defendants' misconduct into allowing the filing deadline to pass, or was unable to obtain vital information bearing on the existence of his TILA claim, despite all due diligence. Rosal v. First Fed. Bank of California, 671 F. Supp. 2d 1111, 1123 (N.D. Cal. 2009); see also Scholar v. Pacific Bell, 963 F.2d 264, 267-68 (9th Cir. 1992) (noting that equitable tolling allows relief from a statute of limitations in "extreme cases" and that courts "have been generally unforgiving...when a late filing is due to the claimant's failure to exercise due diligence in preserving his legal rights."). "Fairness, without more, is not sufficient justification to invoke equitable tolling...." Garcia v. Brockway, 526 F.3d 456, 466 (9th Cir. 2008). In this case, plaintiffs' complaint merely alleges that equitable tolling should be applied to

their TILA claim, because "[a]ny and all statutes of limitations relating to disclosures and notices for client pursuant to 15 US 1601 et seq were tolled due to the hidden nature of this violation which did not reveal [*17] itself until within the past year." (Compl. 28.) This allegation is entirely conclusory and insufficient to invoke the application of equitable tolling. Plaintiffs do not provide any specific facts as to why they were unable to discover the alleged TILA violations until within the past year. Nor do plaintiffs allege any specific facts indicating that Wells Fargo attempted to conceal the alleged inadequacy of required notices or disclosures, or otherwise make a showing of extraordinary circumstances that would warrant the application of equitable tolling. Therefore, the court dismisses plaintiffs' TILA claim for damages, but with leave to amend. In any amended complaint, plaintiffs shall set forth, in a single cause of action, the specific TILA violations that Wells Fargo allegedly committed, the facts in support of those alleged violations, when and how plaintiffs became aware of those violations, and specific facts explaining why plaintiffs were unable to discover the alleged TILA violations within the one-year limitations period. Any amended complaint shall not include a TILA claim for rescission, which would be clearly time barred for the reasons discussed above. RESPA Claim Plaintiffs' [*18] complaint alleges that Wells Fargo violated RESPA by failing to provide certain information and/or documentation to plaintiffs at or before the closing of the loan transaction. (Compl. 11-15.) Wells Fargo time barred. argues that plaintiffs' RESPA claim is

"Any action pursuant to the provisions of section 2605, 2607, or 2608 of this title may be brought in the United States district court or in any other court of competent jurisdiction, for the district in which the property involved is located, or where the violation is alleged to have occurred, within 3 years in the case of a violation of section 2605 of this title and 1 year in the case of a violation of section 2607 or 2608 of this title from the date of the occurrence of the violation...." 12 U.S.C. 2614. Because plaintiffs' allegations involve Wells Fargo's alleged failure to provide certain information and/or documentation to plaintiffs at or before the closing of the loan transaction, any alleged RESPA violation occurred at that time. See Metcalf v. Drexel Lending Group, 2008 U.S. Dist. LEXIS 87420, 2008 WL 4748134, at *3 (S.D. Cal. Oct. 29, 2008) ("Typically, in cases involving loan documents, the statute begins to run when the documents are signed....") [*19] Furthermore, even though it is not exactly clear under which section(s) of RESPA plaintiffs' claim arises, plaintiffs' RESPA claim would appear to be time barred regardless of whether the one-year or three-year limitations period under 12 U.S.C. 2614 is applied, given that any RESPA violation allegedly occurred at or before the closing of plaintiffs' loan in October 2006 and plaintiffs did not bring this action until

2013. (RJN, Ex. A.) Although the Ninth Circuit apparently has not addressed the issue of whether equitable tolling is available under RESPA, several California federal district courts have determined that it may be invoked in the context of a RESPA claim. See Rosal, 671 F. Supp. 2d at 1125 (collecting several cases). However, even assuming that equitable tolling is available, plaintiffs failed to allege sufficient facts demonstrating entitlement to equitable tolling for the same reasons stated above with respect to the TILA claim. Accordingly, plaintiffs' RESPA claim is dismissed, but with leave to amend. In any amended complaint, plaintiffs shall set forth, in a single cause of action, the specific RESPA allegedly committed, whether those violations [*20] arise violations that Wells Fargo under sections 2605, 2607, and/or 2608 of that statute, the facts in support of those alleged violations, when and how plaintiffs became aware of those violations, and specific facts explaining why plaintiffs were unable to discover the alleged RESPA violations within the applicable limitations period. Wells Fargo also correctly notes that plaintiffs failed to allege facts showing that they suffered any actual damages as a result of a RESPA violation. See Garcia v. Wachovia Mortg. Corp., 676 F. Supp. 2d 895, 909 (C.D. Cal. 2009); Lemieux v. Litton Loan Serv., LP, 2009 U.S. Dist. LEXIS 123833, 2009 WL 5206641, at *3 (E.D. Cal. Dec. 21, 2009); Molina v. Washington Mut. Bank, 2010 U.S. Dist. LEXIS 8056, 2010 WL 431439, at *7 (S.D. Cal. Jan. 29, 2010). Conclusory allegations of damages, unsupported by any facts, are insufficient. Garcia, 676 F. Supp. 2d at 909. Accordingly, in any amended complaint, plaintiffs shall also specifically allege what damages are attributable to Wells Fargo's alleged RESPA violation(s). ECOA Claim Plaintiffs' complaint only makes some passing references to ECOA without alleging any facts in support of a claim under that statute. (Compl. 7, 17.) ECOA prohibits a creditor from discriminating "against any applicant, [*21] with respect to any aspect of a credit transaction - (1) on the basis of race, color, religion, national origin, sex or marital status, or age...; (2) because all or part of the applicant's income derives from any public assistance program; or (3) because the applicant has in good faith exercised any right under this chapter." 15 U.S.C. 1691(a). To state a claim of discrimination under ECOA, a plaintiff "must allege that: (1) she is a member of a protected class; (2) she applied for credit with [the defendant]; (3) she qualified for credit; and (4) she was denied credit despite being qualified." Hafiz v. Greenpoint Mortg. Funding, Inc., 652 F. Supp. 2d 1039, 1045 (N.D. Cal. 2009). The applicable statute of limitations for an ECOA claim is five years, which runs from the "date of the occurrence of the violation." 15 U.S.C. 1691e(f). As an initial matter, plaintiffs' complaint completely fails to explain why ECOA is applicable to this action. Not only have plaintiffs not alleged that they are members of a

protected class, but they have not alleged that Wells Fargo has taken an "adverse action" against them. For example, there are no allegations that plaintiffs were denied a loan because [*22] they were African American, whereas similarly situated non-African American applicants were granted loans. To the contrary, plaintiffs allege that Wells Fargo (or its predecessor) extended them a loan. Although they allege that Wells Fargo engaged in various types of misconduct, and committed several violations of other statutes, with respect to the loan, there is no indication in the complaint that Wells Fargo an "adverse action" against plaintiffs for purposes of ECOA. took

Additionally, even if plaintiffs could conceivably state an ECOA violation, it would be time barred, because this action was filed in 2013, more than five years after the loan transaction occurred in 2006. (RJN, Ex. A.) Furthermore, for the same reasons discussed above, plaintiffs' complaint provides no facts to support invocation of the doctrine of equitable tolling. Hafiz, 652 F. Supp. 2d at 1045. Although the court has grave doubts that plaintiffs could allege a cognizable claim under ECOA, the court will nonetheless dismiss the claim with leave to amend, if plaintiffs can do so in good faith within the strictures of Federal Rule of Civil Procedure 11. If plaintiffs elect to include an ECOA claim in any amended [*23] complaint, they shall allege specific facts in support of the alleged ECOA violation(s) and shall explain why they were unable to discover such violation(s) within the applicable limitations period. Claim for Violation of California Civil Code section 2923.5 (Fourth Cause of Action) Plaintiffs' complaint alleges that Wells Fargo failed to follow the requirements of California Civil Code section 2923.5, such as the requirement to contact plaintiff and explore options to avoid foreclosure, prior to recording a notice of default on the Property. (Compl. 39-50.) Wells Fargo correctly contends that any such claim is preempted by the Home Owners' Loan Act, 12 U.S.C. 1461 et seq. ("HOLA"). Judicially-noticed facts show, and plaintiffs do not dispute, that at the time that plaintiffs consummated their loan with World Savings Bank, FSB (Wells Fargo's predecessor), World Savings was a federal savings bank under the authority of the Office of Thrift Supervision. (RJN, Ex. B.) Plaintiffs' loan is therefore subject to HOLA, even though present-day Wells Fargo is not chartered as a federal savings bank. See DeLeon v.

Wells Fargo Bank, N.A. , 729 F. Supp. 2d 1119, 1126 (N.D. Cal. 2010) ("Wells [*24] Fargo notes that at the time the loan was made to the DeLeons, World Savings Bank, FSB was a federally chartered savings bank organized and operating

under HOLA and observes correctly that the same preemption analysis would apply to any alleged conduct after November 1, 2009, when the lender merged into a national banking association."); Osorio v. Wachovia Mortg., FSB, 2012 U.S. Dist. LEXIS 64600, 2012 WL 1610110, at *3 (S.D. Cal. May 8, 2012) ("Because Plaintiff's loan originated with World Savings Bank, FSB, HOLA."). which was a federal savings bank, Plaintiff's action is governed by

The applicable regulations provide for HOLA preemption of state laws that purport to impose upon a federal savings bank any requirements regarding, inter alia, "processing, origination, servicing, sale or purchase of, or investment or participation in, mortgages." 12 C.F.R. 560.2(b)(10). Numerous federal district courts in California have held that claims for violation of California Civil Code section 2923.5 are preempted by HOLA, because they fall within the scope of 12 C.F.R. 560.2(b)(10). See Taguinod v. World Savings Bank, FSB , 755 F. Supp. 2d 1064, 1073-74 (C.D. Cal. 2010) (collecting cases). Accordingly, plaintiffs' claim [*25] for violation of California Civil Code section 2923.5 should be dismissed and cannot be cured by further amendment. In light of this conclusion, the court finds it unnecessary to reach Wells Fargo's alternative argument that plaintiffs' claim is also barred by the applicable statute of limitations. 6

- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - 6 Wells Fargo, in reliance on Exhibit C to the request for judicial notice, further argues that in fact no notice of default had been recorded on the property. However, for the reasons discussed above, the court cannot take judicial notice of Exhibit C to the request for judicial notice, and the court accepts plaintiffs' allegation regarding the July 2009 Notice of Default as true for purposes of this motion to dismiss. - - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - Claims under California Business and Professions Code sections 17200 et seq. (Sixth and Seventh Causes of Action) Plaintiffs' claims for violation of California Business and Professions Code sections 17200 et seq. are expressly predicated on the alleged violation of California Civil Code section 2923.5. Because that underlying claim is preempted, the section 17200 claims are likewise subject to dismissal. Fraud Claims (First and Third Causes of Action) In support of their fraud [*26] claims, plaintiffs appear to allege that Wells Fargo made false statements and misrepresentations in the context of the loan origination as well as during the loan modification process. (See, e.g., Compl. 4, 19-25, 32-38.)

Wells Fargo contends that plaintiffs' fraud claims do not meet the heightened pleading requirements under Federal Rule of Civil Procedure 9(b). That argument has merit. "The elements of a California fraud claim are: (1) misrepresentation (false representation, concealment or nondisclosure); (2) knowledge of the falsity (or 'scienter'); (3) intent to defraud, i.e., to induce reliance; (4) justifiable reliance; and (5) resulting damage." Altman v. PNC Mortg., 850 F. Supp. 2d 1057, 1068-69 (E.D. Cal. 2012) (citing Lazar v. Superior Ct., 12 Cal. 4th 631, 638, 49 Cal. Rptr. 2d 377, 909 P.2d 981 (1996)). When pleading a fraud-based claim, the claim must meet the heightened pleading requirements of Federal Rule of Civil Procedure 9(b), which states: "In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally." Fed. R. Civ. P. 9(b). As the Ninth Circuit has [*27] explained: Rule 9(b) requires particularized allegations of the circumstances constituting fraud. The time, place, and content of an alleged misrepresentation may identify the statement or the omission complained of, but these circumstances do not "constitute" fraud. The statement in question must be false to be fraudulent. Accordingly, our cases have consistently required that circumstances indicating falseness be set forth...[W]e [have] observed that plaintiff must include statements regarding the time, place, and nature of the alleged fraudulent activities, and that "mere conclusory allegations of fraud are insufficient."...[W]e [have] required plaintiffs to set forth "specific descriptions of the representations made, and the reasons for their falsity."...To allege fraud with particularity, a plaintiff must set forth more than the neutral facts necessary to identify the transaction. The plaintiff must set forth what is false or misleading about a statement, and why it is false. In re GlenFed, Inc. Securities Litigation, 42 F.3d 1541, 1547-48 (9th Cir. 1994) (en banc) (emphasis in original), superseded by statute on other grounds as stated in Marksman Partners, L.P. v. Chantal Pharm. Corp., 927 F. Supp. 1297 (C.D. Cal. 1996); [*28] see also Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997) (noting that fraud claims must be accompanied by the "who, what, when, where, and how" concerning the misconduct). Plaintiffs' allegations of fraud in their complaint are plainly deficient, because although plaintiffs make reference to some alleged misrepresentations, they do not specify in any detail the contents of the alleged misrepresentations, who made the alleged misrepresentations, when and where the alleged misrepresentations were made, and wh