United States District Court, D. Arizona
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. ...