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Fishburne v. CitiMortgage Inc.

United States District Court, D. Arizona

September 23, 2019

Cherie A. Fishburne, Plaintiff,
CitiMortgage Incorporated, et al., Defendants.



         At issue are Defendants Tiffany & Bosco, P.A. and Leonard J. McDonald’s (collectively, “Bosco Defendants”) Motion to Dismiss (Doc. 18), to which pro se Plaintiff Cherie A. Fishburne filed a Response (Doc. 36), and Bosco Defendants filed a Reply (Doc. 40); Defendant CitiMortgage Inc.’s (“CMI”) Motion to Dismiss (Doc. 19), to which Plaintiff filed a Response (Doc. 31), and CMI filed a Reply (Doc. 41); and Defendants S. Matt Collins, Carrie Collins, David LaSpaluto, and Sarah Sabalos-LaSpaluto’s (collectively, “Attorney Defendants”) Motion to Dismiss (Doc. 23), to which Plaintiff filed a Response (Doc. 37), and Attorney Defendants filed a Reply (Doc. 42). The Court resolves these Motions without oral argument. See LRCiv 7.2(f).

         I. BACKGROUND

         On January 19, 2007, Plaintiff took out a loan for $645, 750 from CMI’s predecessor, ABN AMRO (“Loan”), secured by a Deed of Trust on property located at 12054 West Skinner Drive, Peoria, Arizona 85383 (the “Property”). The Deed of Trust was not recorded. The purpose of the Loan was to pay off a purchase money loan Plaintiff had taken out in 2006, and the release of the purchase money loan as a result of the 2007 Loan was recorded. Plaintiff filed a voluntary petition for Chapter 13 bankruptcy on October 14, 2009. In the bankruptcy proceedings, Plaintiff asserted that the Loan was secured by the Deed of Trust on the Property. CMI submitted a claim under the Loan and Deed of Trust, and Plaintiff did not object or otherwise raise any claims against CMI. The Bankruptcy Court confirmed a Chapter 13 Plan on July 15, 2010.[1]

         On February 16, 2017, CMI filed suit against Plaintiff in Arizona state court, seeking a declaration that the Deed of Trust, although not recorded, constitutes a valid encumbrance on the Property and that Plaintiff is estopped from challenging its validity. Mr. LaSpaluto and Mr. Collins were counsel for CMI in the lawsuit. The state court granted summary judgment for CMI and entered Judgment on July 18, 2018. Plaintiff did not appeal, but she filed a motion for reconsideration about six months later. On December 31, 2018, the state court judge denied the motion and subsequently denied Plaintiff’s Temporary Restraining Order request, which sought to avoid a pending foreclosure of the Deed of Trust.

         Bosco Defendants are the trustee under the Deed of Trust and are attempting to perform a non-judicial foreclosure on the Property. They took no part in the state court action.

         On January 9, 2019, Plaintiff filed a Chapter 7 bankruptcy petition, which she alleges she was forced to do to automatically stay “Defendant’s illegal non-judicial foreclosure action.” (Doc. 1, Compl. ¶ 44.) She then filed the present lawsuit on January 15, 2019, raising eleven claims against Defendants: (1) recording false documents in violation of A.R.S. §§ 33-420(A) and (B); (2) violation of the Fair Debt Collection Practices Act, 15 U.S.C. § 1692(e) (“FDCPA”); (3) declaratory and injunctive relief under 28 U.S.C. § 2201 and A.R.S. § 33-801; (4) breach of fiduciary duties; (5) fraudulent concealment; (6) civil conspiracy; (7) fraudulent misrepresentation; (8) conversion; (9) quiet title; (10) unjust enrichment; and (11) wrongful foreclosure. The Court denied Plaintiff’s request for a Preliminary Injunction on March 8, 2019. (Doc. 32.) Defendants now move to dismiss all claims against them.


         When analyzing a complaint for failure to state a claim for relief under Federal Rule of Civil Procedure 12(b)(6), 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). Legal conclusions couched as factual allegations are not entitled to the assumption of truth, Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009), and therefore are insufficient to defeat a motion to dismiss for failure to state a claim. In re Cutera Sec. Litig., 610 F.3d 1103, 1108 (9th Cir. 2010).

         A dismissal under Rule 12(b)(6) for failure to state a claim can be based on either (1) the lack of a cognizable legal theory or (2) insufficient facts to support a cognizable legal claim. Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990). “While a complaint attacked by a Rule 12(b)(6) motion does not need detailed factual allegations, a plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to 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 (citations omitted). The complaint must thus contain “sufficient factual matter, accepted as true, to ‘state 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). “[A] well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable, and that ‘recovery is very remote and unlikely.’” Twombly, 550 U.S. at 556 (quoting Scheuer v. Rhodes, 416 U.S. 232, 236 (1974)).

         III. ANALYSIS

         A. Judicial Estoppel

         All of Plaintiff’s claims in this lawsuit are premised on the proposition that Defendants did not have a valid, enforceable Deed of Trust on the Property-a proposition that the state court has already rejected in a final Judgment. To begin with, Plaintiff is judicially estopped from claiming to this Court that the Deed of Trust is not valid and enforceable by her representations in her Chapter 13 proceedings in United States Bankruptcy Court in 2009 and 2010.

         Judicial estoppel-“an equitable doctrine invoked by a court at its discretion”- exists to protect the integrity of the judicial process by “prohibiting parties from deliberately changing positions according to the exigencies of the moment.” New Hampshire v. Maine, 532 U.S. 742, 749–50 (2001) (citations and internal quotation marks omitted). “[W]here a party assumes a certain position in a legal proceeding, and succeeds in maintaining that position, he may not thereafter, simply because his interests have changed, assume a contrary position.” New Hampshire, 532 U.S. at 749 (citations and internal quotation marks omitted). The application of judicial estoppel is appropriate to ...

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