United States District Court, D. Arizona
HONORABLE BRUCE G. MACDONALD UNITED STATES MAGISTRATE JUDGE
pending before the Court is Defendant Wells Fargo Bank,
N.A.'s (“Wells Fargo”) Motion to Dismiss
(Doc. 7). Plaintiffs filed a Response (Doc. 10), and
Defendant subsequently replied (Doc. 14). The motion is fully
briefed and ripe for adjudication.
discretion, the Court finds this case suitable for decision
without oral argument. See LRCiv. 7.2(f). The
Parties have adequately presented the facts and legal
arguments in their briefs and supporting documents, and the
decisional process would not be significantly aided by oral
live at 495 Earl Drive, Sierra Vista, Arizona 85635
(“Plaintiffs' home”). Compl. (Doc. 1-4) at
¶ 6. On February 13, 2003, Plaintiffs executed a
Promissory Note in the amount of $93, 000.00 in favor of
Defendant. Id. at ¶ 7. Plaintiff's home was
used as collateral for the February 2003 loan, and Plaintiffs
executed a Deed of Trust in favor of Defendant and naming
First American Title of AZ as Trustee. Id. at ¶
8. On February 21, 2003, the Deed of Trust was recorded at
Instrument number 030206096, in Cochise County. Id.
December 17, 2015, Defendant informed Plaintiffs that it had
initiated foreclosure proceedings on Plaintiffs' home.
Id. at ¶ 9. On December 21, 2015, Defendant
informed Plaintiffs that the total amount past due under the
Promissory Note was $4, 625.76. Compl. (Doc. 1-4) at ¶
10 & Wells Fargo Reinstatement Quote to Hockers
12/21/2015 (Exh. “1”). On December 23, 2015,
First American Title Insurance Company recorded a Notice of
Trustee Sale with the Cochise County Recorder, indicating
that Plaintiffs' home would be sold at public auction on
March 28, 2016. Id. at ¶ 11. On January 7,
2016, First American Title Insurance Company recorded a
Cancellation of Trustee's Sale, thereby cancelling the
March 28, 2016 public auction. Id. at ¶ 13.
January 8, 2016, Plaintiffs paid Defendant $4, 625.76 to
reinstate the loan and avoid foreclosure. Id. at
¶ 14. On January 11, 2016, First American Title
Insurance Company recorded a second Notice of Trustee Sale
with the Cochise County Recorder, indicating the
Plaintiffs' home would be sold at public auction on April
13, 2016. Id. at ¶ 15. On February 16, 2016,
Defendant sent Plaintiff a statement, which indicated their
loan had been reinstated from foreclosure. Compl. (Doc. 1-4)
at ¶ 16 & Wells Fargo Statement, Loan No. 0017768391
2/16/2016 (Exh. “3”). Plaintiffs allege that they
did not receive notice of the second Notice of Trustee Sale,
and only learned of the foreclosure from a “third
party” mailing. Id. at ¶ 19. Plaintiffs
contacted a representative of the Defendant and were informed
that the property was not in foreclosure and no sale or
public auction was scheduled. Id. at ¶ 20.
Plaintiffs allege that Defendant refused to take any action
to cancel the April 13, 2016 trustee sale. Id. at
¶ 21. On April 12, 2016, Plaintiffs filed for Chapter 13
bankruptcy in the United States Bankruptcy Court, District of
Arizona to avoid foreclosure. Id. at ¶¶
22-23. The following day, First American Title Insurance
Company recorded a Cancellation of the Notice of
Trustee's Sale. Compl. (Doc. 1-4) at ¶ 24.
9, 2016, Plaintiffs filed their Bankruptcy Schedules and
Statements. In re: Hocker, D. Ariz., Case No.
16-BK-03848-BMW, Official Form 106Sum (Doc. 15). In the
Bankruptcy Schedules, Plaintiffs denied having any claims
against third parties or other contingent and unliquidated
claims. Id. at ¶¶ 33, 34. Plaintiffs
failed to identify any claims against Wells Fargo in their
Bankruptcy Schedules. See id. On November 16, 2017,
Plaintiffs' Second Amended Chapter 13 Plan was confirmed.
In re: Hocker, D. Ariz., Case No. 16-BK-03848-BMW,
Stipulated Order Confirming Second Amended Chapter 13 Plan
17, 2018, Plaintiffs filed a Complaint in the Superior Court
of Arizona, Cochise County, alleging claims for a Violation
of A.R.S. § 33-420; Breach of Contract; and Breach of
the Implied Covenant of Good Faith and Fair Dealing. Compl
(Doc. 1-4). Plaintiffs allege “Defendant knew that the
Second Notice of Trustee Sale was forged, groundless,
contained a material misstatement and/or false claim.”
Id. at ¶ 27. Plaintiffs further allege that the
recording of the Second Notice violated A.R.S. § 33-420
and that Defendant's alleged wrongful initiation of the
second foreclosure proceeding forced Plaintiffs to hire an
attorney and file for bankruptcy. Compl. (Doc. 1-4)
¶¶ 33, 35, 39. On June 22, 2018, Defendant removed
the case to this Court. Notice of Removal (Doc. 1). Defendant
seeks dismissal of the Complaint pursuant to Rule 12(b)(6),
Federal Rules of Civil Procedure.
STANDARD OF REVIEW
complaint is to contain a “short and plain statement of
the claim showing that the pleader is entitled to
relief[.]” Rule 8(a), Fed.R.Civ.P. While Rule 8 does
not demand detailed factual allegations, “it demands
more than an unadorned, the-defendant-unlawfully-harmed-me
accusation.” Ashcroft v. Iqbal, 556 U.S. 662,
678, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009).
“Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not
suffice.” Id.; Pareto v. Fed. Deposit Ins.
Corp., 139 F.3d 696, 699 (9th Cir. 1998)
(“conclusory allegations of law and unwarranted
inferences are not sufficient to defeat a motion to
is appropriate where a plaintiff has failed to “state a
claim upon which relief can be granted.” Rule 12(b)(6),
Fed.R.Civ.P. “To survive a motion to dismiss, a
complaint must contain sufficient factual matter, accepted as
true, to ‘state a claim to relief that is plausible on
its face.'” Ashcroft, 556 U.S. at 678, 129
S.Ct. at 1949 (quoting Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 1974, 167
L.Ed.2d 929 (2007)). Further, “[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 to a ‘probability
requirement,' but it asks for more than a sheer
possibility that a defendant has acted unlawfully.”
Id. (citations omitted).
ruling on a motion to dismiss, [the Court must] accept all
factual allegations in the complaint as true and construe the
pleadings in the light most favorable to the nonmoving
party.” Association for Los Angeles Deputy Sheriffs
v. County of Los Angeles, 648 F.3d 986, 991 (9th Cir.
2011) (quoting Knievel v. ESPN, 393 F.3d 1068, 1072
(9th Cir. 2005)). “The court draws all reasonable
inferences in favor of the plaintiff.” Id.
(citing Newcal Industries, Inc. v. Ikon Office
Solution, 513 F.3d 1038, 1043 n.2 (9th Cir. 2008)). This
Court is not required, however, to accept conclusory
statements as a factual basis. See Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 1964, 167
L.Ed.2d 929 (2007); Mann v. City of Tucson, 782 F.2d
790, 793 (9th Cir. 1986) (“Although we must, in
general, accept the facts alleged in the complaint as true,
wholly vague and conclusory allegations are not sufficient to
withstand a motion to dismiss.”).
a general rule, a district court may not consider any
material beyond the pleadings in ruling on a Rule 12(b)(6)
motion.” Lee v. City of Los Angeles, 250 F.3d.
668, 688 (9th Cir. 2001) (quotations and citations omitted).
“There are, however, two exceptions to the requirement
that consideration of extrinsic evidence converts a 12(b)(6)
motion to a summary judgment motion. Id.
“First, a court may consider material which is properly
submitted as part of the complaint[.]” Id.
Second, “[a] court may take judicial notice of
‘matters of public record' without converting a