United States District Court, D. Arizona
ORDER
Dominic W. Lanza United States District Judge
Pending
before the Court are (1) a motion to dismiss by Carrington
Foreclosure Services, LLC (“CFS”) (Doc. 10), and
(2) a motion to dismiss by Bank of America, N.A.
(“BANA”) and Recontrust Company
(“Recontrust”) (Doc. 15), which CFS has joined
(Doc. 16). For the following reasons, the former motion will
be stricken based on non-compliance with Local Rule 12.1(c),
the latter motion will be granted, and this action will be
terminated.
BACKGROUND
I.
Factual Background
The
facts alleged in the complaint, and as set forth in CFS's
unopposed request for judicial notice (Doc. 11) and in the
judicially noticeable documents referenced in and/or attached
to the complaint and the BANA/Recontrust motion to dismiss,
[1]
are as follows.
On July
13, 2009, Plaintiff Tracy Medrano executed a written
agreement with Paramount Residential Mortgage Group to obtain
a mortgage loan in the amount of $157, 102. (Doc. 1 at 10
¶ 11.) “To secure repayment of the loan, and as
part of the same transaction, [Medrano] made and executed a
written deed of trust . . . .” (Id.) Great
American Title Agency was the original trustee and Mortgage
Electronic Registration Systems the original beneficiary.
(Id. at 27.) The property is located at 16544 West
Grant Street, Goodyear, Arizona. (Id. at 28.)
On
October 6, 2011, BANA became the trust beneficiary. (Doc. 15
at 12.)
On July
17, 2012, BANA recorded a substitution naming Recontrust the
successor trustee. (Doc. 1 at 37.) The complaint alleges this
substitution was “unlawful[]” and “without
notice” to Medrano. (Id. at 11 ¶ 15.)
That
same day, Recontrust recorded a notice of trustee's sale.
(Id. at 39.) The complaint alleges this recording
was also “unlawful[]” and “without
notice” to Medrano. (Id. at 11 ¶ 17.) Two
days later, Recontrust cancelled the notice of sale. (Doc. 15
at 14.)
On or
about May 29, 2013, BANA and Medrano executed a loan
modification agreement. (Doc. 1 at 43-44.) This agreement
increased the loan principal to $171, 295.55. (Id.)
Although the complaint does not explain the origin of this
agreement, [2] it alleges that BANA had “no
standing to execute” the document and the agreement
“did not clear any lien or encumbrance on the real
property.” (Id. at 11-12 ¶ 19.)
On June
23, 2015, BANA and Medrano entered into another loan
modification agreement that decreased the principal to $139,
697.62. (Id. at 46-52.) The complaint alleges this
modification agreement was legally deficient for the same
reasons as the previous one. (Id. at 12 ¶ 20.)
On
February 8, 2017, BANA assigned its interest as beneficiary
of the deed of trust to Carrington Mortgage Services, LLC
(“CMS”) (which is a different entity than CFS,
the defendant named in the complaint). (Id. at 56.)
The complaint alleges, however, that BANA “[did] not
have standing or the legal authority to record or cause the
purported assignment of the deed of trust under
[Medrano's] Note to be recorded” because BANA was
“not the holder of [Medrano's] Note in due
course” and thus the assignment was
“fraudulent.” (Id. at 12 ¶ 23.) The
complaint further alleges that BANA did not hold the note in
due course because it was “not a party to the contract
that secured [Medrano's] Note and deed of Trust”
and “[did] not have any lawful and original assignment
instruments from the lender.” (Id. at 12-13
¶ 24.)
On
February 5, 2019, CFS was substituted as the
trustee.[3] (Id. at 58.) The complaint
alleges this substitution was “invalid . . . and of no
force and effect” because CMS lacked “standing or
legal authority” to complete this substitution.
(Id. at 13 ¶ 27.)
On
February 12, 2019, CFS recorded a Notice of Trustee's
Sale. (Id. at 61-62.) The complaint alleges this
recording was “unlawful[]” and “without
notice” to Medrano. (Id. at 13 ¶ 28.)
To sum
up, the complaint alleges that, over the course of
approximately 10 years, legal and beneficial ownership of
Medrano's deed of trust changed hands numerous times, no
such change was legally valid, and both attempted foreclosure
sales were unlawful and without notice to Medrano.
Additionally, over these 10 years, all defendants
“act[ed] in concert and conspiracy” to
“conceal[] the fact that the loans were
“securitized, ” which had a “materially
negative effect on [Medrano].” (Id. at 15
¶ 34.) Had Medrano known the “truth” about
the agreements, she “would not have entered into the
Loan agreement.” (Id. at 15 ¶ 35.) This
concealment also “prevented [her] from discovering . .
. the wrongdoing complained of herein.” (Id.
at 11 ¶ 18.) Finally, both as a result of the
“constant emotional nightmare of losing her real
Property” caused by the “fraudulent foreclosure
proceedings, ” as well as the fact that “her
title to the Property has been disparaged and slandered,
” Medrano has suffered “many sleepless nights,
severe depression, lack of appetite, and loss of productivity
at [her] place of employment.” (Id. at 18
¶¶ 53-56, 21 ¶¶ 70-72.)
Medrano
requests special, compensatory, and punitive damages in an
amount to be determined at trial, a “decree permanently
enjoining defendants . . . from asserting any adverse claim
to plaintiffs' title to the property, ”
“disgorgement of all profits obtained by Defendants by
virtue of their misconduct, ” “[r]estitution as
allowed by law, ” attorney's fees and costs, costs
of suit, and other relief the Court may deem proper.
(Id. at 25.)
II.
Procedural Background
On June
21, 2019, Medrano (who is proceeding pro se) initiated this
action by filing a complaint in Maricopa County Superior
Court. (Doc. 1 at 6.)
On
August 19, 2019, BANA removed this action to federal court
based on diversity jurisdiction. (Doc. 1 at 3 [citing 28
U.S.C. §§ 1332 and 1441].) The case was originally
assigned to Judge Humetawa. (Doc. 2.)
On
August 27, 2019, CFS filed a motion to dismiss. (Doc. 10.)
On
September 3, 2019, the case was reassigned to the current
judge. (Doc. 14.) On September 9, 2019, BANA and Recontrust
filed a motion to dismiss. (Doc. 15.) The following day, CFS
filed a joinder in their motion. (Doc. 16.)
On
September 26, 2019, Medrano responded to both motions to
dismiss. (Docs. 18, 19.)
On
October 3, 2019, BANA and Recontrust filed a reply. (Doc.
20.)
On
October 7, 2019, CFS filed a reply in support of its motion,
which also asserted that CFS was joining the ...