Jones v. Bank of America NA

          ORDER

          Honorable Susan M. Brnovich, United States District Judge

         Pending before the Court is a motion to dismiss pursuant to Rule 12(b)(6) filed by Defendant Bank of America, N.A. (“BANA”) (Doc. 68). Defendant Joseph J. Tirello Jr. filed a “Notice of Joinder in Bank of America's Motion to Dismiss.” (Doc. 69). Plaintiff James Jones filed an opposition to BANA's motion, (Doc. 71), and BANA filed a reply. (Doc. 74). Plaintiff also filed a sur-reply (Doc. 76) without moving for leave to do so. The Court will strike Plaintiff's sur-reply and not consider it.^[1]

         BACKGROUND

         On November 6, 2017, Plaintiff filed a Complaint against multiple defendants, including BANA and Tirello. (Doc. 1). That complaint was dismissed and an Amended Complaint (Doc. 8, “FAC”) was filed on January 26, 2018 with court approval. It is difficult to ascertain from the FAC exactly what Plaintiff alleges occurred, but his allegations are centered around real property located at 3787 East Snavely Avenue, Kingman, AZ 86409 (the “Property”), which he alleges that at least some of the Defendants foreclosed on in 2016. Plaintiff alleges that he owned and has superior claim to the Property and that he received a quit claim deed on March 29, 2012 from Harold Goddard (“Goddard”). (FAC at 1). In the FAC, Plaintiff lists eleven counts under the Fair Debt Collection Practices Act (the “FDCPA”) and one count under the Truth in Lending Act (the “TILA”). Plaintiff also requests declaratory relief and rescission of the loan.

         DISCUSSION

         I. Legal Standard

         To survive a Rule 12(b)(6) motion for failure to state a claim, a complaint must meet the requirements of Rule 8(a)(2). Rule 8(a)(2) requires a “short and plain statement of the claim showing that the pleader is entitled to relief, ” so that the defendant has “fair notice of what the . . . claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). Dismissal under Rule 12(b)(6) “can be based on the lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1988). A complaint that sets forth a cognizable legal theory will survive a motion to dismiss if it contains sufficient factual matter, which, if accepted as true, states a claim to relief that is “plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). Facial plausibility exists if the pleader sets forth “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. Plausibility does not equal “probability, ” but requires “more than a sheer possibility that a defendant has acted unlawfully.” Id. “Where a complaint pleads facts that are ‘merely consistent' with a defendant's liability, it ‘stops short of the line between possibility and plausibility of entitlement to relief.'” Id. (quoting Twombly, 550 U.S. at 557).

         Although a complaint attacked for failure to state a claim does not need detailed factual allegations, the pleader's obligation to provide the grounds for relief requires “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555 (internal citations omitted). Rule 8(a)(2) “requires a ‘showing,' rather than a blanket assertion, of entitlement to relief, ” as “[w]ithout some factual allegation in the complaint, it is hard to see how a claimant could satisfy the requirement of providing not only ‘fair notice' of the nature of the claim, but also ‘grounds' on which the claim rests.” Id. at 555 n.3 (citing 5 Charles A. Wright & Arthur R. Miller, Federal Practice & Procedure § 1202, at 94-95 (3d ed. 2004)). Thus, Rule 8's pleading standard demands more than “an unadorned, the-defendant-unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 555).

         In ruling on a Rule 12(b)(6) motion to dismiss, the well-pled factual allegations are taken as true and construed in the light most favorable to the nonmoving party. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). However, legal conclusions couched as factual allegations are not given a presumption of truthfulness, and “conclusory allegations of law and unwarranted inferences are not sufficient to defeat a motion to dismiss.” Pareto v. FDIC, 139 F.3d 696, 699 (9th Cir. 1998). A court ordinarily may not consider evidence outside the pleadings in ruling on a Rule 12(b)(6) motion to dismiss. See United States v. Ritchie, 342 F.3d 903, 907 (9th Cir. 2003). “A court may, however, consider materials- documents attached to the complaint, documents incorporated by reference in the complaint, or matters of judicial notice-without converting the motion to dismiss into a motion for summary judgment.” Id. at 908.

         II. Defendant BANA's Motion

         A. Standing

         BANA argues that Plaintiff lacks standing to bring this action against BANA “because Plaintiff is not, and never has been, a party to the Loan.” (Doc. 68 at 4). BANA cites a case from this District that found that one spouse did not have standing to assert counts including contract and rescission of a loan under TILA because she was not a party to the note and deed of trust. See Diamond v. One W. Bank, No. CV-09-1593-PHX-FJM, 2010 WL 1742536, at *2 (D. Ariz. Apr. 29, 2010), order amended on reconsideration, No. CV-09-1593-PHX-FJM, 2010 WL 2200501 (D. Ariz. May 28, 2010). In response, Plaintiff argues that BANA does not have standing. (Doc. 71 at 4).

         To show that a case or controversy exists, a plaintiff must establish that he has standing to bring suit. Lujan v. Defs. Of Wildlife, 504 U.S. 555, 560-61 (1992). A plaintiff must satisfy three elements to establish Article III standing: (1) an injury in fact, (2) a causal connection between the injury and the allegedly wrongful conduct, and (3) that the injury is likely to be redressed by a favorable decision from the Court. Id. Documents submitted by Plaintiff with the FAC show a Deed of Trust recorded on May 20, 2009 regarding the Property. Goddard is described as the borrower and World Alliance Financial Corp. is described as the lender of up to $187, 500. (Doc. 8-1 at 5). Furthermore, correspondence regarding the loan is addressed to Goddard. (Doc. 8-1 at 29). Plaintiff acknowledges that his “name is not on the trust deed, ” but argues that he has standing because of the quit claim deed and “a special power of attorney made out to Plaintiff by Harold Goddard giving Plaintiff standing to sue for Harold Goddard.” (Doc. 71 at 7-8). BANA did not address Plaintiff's argument in its Reply. The Court however notes that a power of attorney is an “instrument granting someone authority to act as agent or attorney-in-fact for the grantor, ” Power of Attorney, Black's Law Dictionary (11th ed. 2019), and “does not confer standing to sue in the holder's own right because a power-of-attorney does not transfer an ownership interest in the claim.” W.R. Huff Asset Mgmt. Co., LLC v. Deloitte & Touche LLP, 549 F.3d 100, 108 (2d Cir. 2008). “By contrast, an assignment of claims transfers legal title or ownership of those claims and thus fulfills the constitutional requirement of an ‘injury-in-fact.'” Id. Therefore, to the extent that any of Plaintiff's claims pertain to Goddard's loan, Plaintiff has not shown that he has standing to bring these claims, and such claims are dismissed.

         B. Claims Relating to the Trustee's Sale

         While Plaintiff postures his complaint as coming under the FDCPA and TILA, he also challenges the validity of the Trustee's Sale. See, e.g., FAC at 13 (alleging that Defendants did not have “authority to foreclose upon and sell Plaintiff[']s property”); id. (“Plaintiff requests a determination of whether any Defendants' have authority to foreclose on the property or to illegally seize the property without notice.”); FAC at 15 (Plaintiff requests “qui[et] title as to the above referenced claims”). BANA argues that Plaintiff waived all defenses and objections to the sale, citing A.R.S. § 33-811(C). (Doc. 68 at 4- 5). To the extent that Plaintiff's claims relate to the Trustee's Sale, the Court agrees with BANA that such claims would be barred by A.R.S. § 33-811(C), which states, in part, as follows:

. . . all persons to whom the trustee mails a notice of a sale under a trust deed pursuant to § 33-809 shall waive all defenses and objections to the sale not raised in an action that results in the issuance of a court order granting relief pursuant to rule 65, Arizona rules of civil procedure, entered before 5:00 p.m. mountain standard time on the last business day before the scheduled date of the sale.

         “In effect, section 33-811 requires Plaintiffs to assert any objections to and obtain injunctive relief from the trustee's sale prior to such sale or risk losing their rights to object.” Spielman v. Katz, No. CV 10-0184-PHX-JAT, 2010 WL 4038838, at *3 (D. Ariz. Oct. 14, 2010); see also BT Capital, LLC v. TD Serv. Co. of Ariz., 275 P.3d 598, 600 (Ariz. 2012) (“Under [A.R.S. § 33-811(C)], a person who has defenses or objections to a properly noticed trustee's sale has one avenue for challenging the sale: filing for injunctive relief.”).

         Plaintiff filed an action in Mohave County Superior Court prior to the non-judicial sale, but failed to secure any Rule 65 relief to enjoin the sale. (Doc. 68-1 at 2-19).^[2] Thus, any challenges to the Trustee's sale of the Property are dismissed.

         C. FDCPA Counts

         “The FDCPA was enacted as a broad remedial statute designed to ‘eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses.'” Gonzales v. Arrow Fin. Servs., LLC,660 F.3d 1055, 1060 (9th Cir. 2011) (quoting 15 U.S.C. § 1692(e)). “In order to state a claim under the FDCPA, a plaintiff must show: 1) that he is a consumer; 2) that the debt arises out of a transaction entered into for personal purposes; 3) that the defendant is a debt collector; and 4) that the defendant violated one of the provisions of the FDCPA.” Dix v. Nat'l Credit Sys., Inc., No. 2:16-CV-3257-HRH, 2017 WL 4865259, at *1 (D. ...