Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_18-cv-07715/USCOURTS-cand-3_18-cv-07715-3/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 28:1332 Diversity-(Citizenship)

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ORDER – No. 18-cv-07715-LB

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

San Francisco Division

MURAD REED,

Plaintiff,

v.

CLEAR RECON CORP, and 

CITIMORTGAGE, INC., erroneously sued 

as CITIBANK, N.A., et al.,

Defendants.

Case No. 18-cv-07715-LB

ORDER TO SHOW CAUSE

INTRODUCTION

In 2018, the plaintiff Murad Reed, who is proceeding pro se, defaulted on a mortgage loan, 

and the loan servicer, CitiMortgage, Inc., initiated foreclosure proceedings.1 The plaintiff sued 

Citibank, N.A., alleging violations of the California Homeowner Bill of Rights (“HBOR”) and 

several tort claims.2 The court granted in part and denied in part CitiMortgage’s motion to dismiss 

the initial complaint and dismissed the non-HBOR claims, and the plaintiff filed an amended 

 

1 First Amended Complaint (“FAC”) – ECF No. 38. Citations refer to material in the Electronic Case 

File (“ECF”); pinpoint citations are to the ECF-generated page numbers at the top of documents. All 

parties, including nominal defendant Clear Recon. Corp., have consented to the undersigned’s 

jurisdiction. Consent Forms – ECF Nos. 10, 19, & 22.

2 FAC – ECF No. 38 at 1.

Case 3:18-cv-07715-LB Document 51 Filed 06/24/19 Page 1 of 4
ORDER – No. 18-cv-07715-LB 2

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complaint.3 On May 5, 2019, the court again denied in part and granted in part CitiMortgage’s 

motion to dismiss the plaintiff’s first amended complaint, dismissed the non-HBOR claims with 

prejudice, and let the HBOR claims stand.

4 CitiMortgage then answered the complaint.5

The plaintiff did not appear at the hearing on the defendant’s first motion to dismiss or at the 

initial case-management conference on June 20, 2019. The court now orders the plaintiff to appear 

in person on July 18, 2019 at 11:00 a.m. to show cause why his lawsuit should not be dismissed 

for his failure to prosecute it. 

ANALYSIS

“Rule 41(b) specifically provides that the failure of the plaintiff to prosecute his claims is 

grounds for involuntary dismissal of the action. The courts have read this rule to require 

prosecution with ‘reasonable diligence’ if plaintiff is to avoid dismissal.” Anderson v. Air W., Inc., 

542 F.2d 522, 524 (9th Cir. 1976) (citing Ballew v. S. Pac. Co., 428 F.2d 787 (9th Cir. 1970)). 

“This court has consistently held that the failure to prosecute diligently is sufficient by itself to 

justify a dismissal, even in the absence of a showing of actual prejudice to the defendant from the 

failure.” Id. (internal citation omitted). “The law presumes injury from unreasonable delay.” Id.

(citing States Steamship Co. v. Philippine Air Lines, 426 F.2d 803, 804 (9th Cir. 1970)). 

“However, this presumption of prejudice is a rebuttable one and if there is a showing that no actual 

prejudice occurred, that factor should be considered when determining whether the trial court 

exercised sound discretion.” Id. (citing Reizakis v. Loy, 490 F.2d 1132 (4th Cir. 1974)).

The Ninth Circuit has “constructed a five-part test, with three subparts to the fifth part, to 

determine whether a case-dispositive sanction under Rule 37(b)(2) is just: ‘(1) the public’s interest 

in expeditious resolution of litigation; (2) the court’s need to manage its dockets; (3) the risk of 

prejudice to the party seeking sanctions; (4) the public policy favoring disposition of cases on their 

 

3 Order – ECF No. 34 at 19; FAC – ECF No. 38.

4 Order – ECF No. 45 at 9–10.

5 Answer – ECF No. 46.

Case 3:18-cv-07715-LB Document 51 Filed 06/24/19 Page 2 of 4
ORDER – No. 18-cv-07715-LB 3

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merits; and (5) the availability of less drastic sanctions.’” Conn. Gen. Life Ins. Co. v. New Images 

of Beverly Hills, 482 F.3d 1091, 1096 (9th Cir. 2007) (quoting Jorgensen v. Cassiday, 320 F.3d 

906, 912 (9th Cir. 2003) (setting forth five-factor test of Malone v. U.S. Postal Serv., 833 F.2d 

128, 130 (9th Cir. 1987)). “The sub-parts of the fifth factor are whether the court has considered 

lesser sanctions, whether it tried them, and whether it warned the recalcitrant party about the 

possibility of case-dispositive sanctions.” Id. (citing Valley Eng’rs v. Elec. Eng’g Co., 158 F.3d 

1051, 1057 (9th Cir. 1998)). The Ninth Circuit applies the same five-factor standard considered in 

Federal Rule of Civil Procedure 37(d) to motions brought under Rule 41(b). See Yourish v. Cal.

Amplifier, 191 F.3d 983, 987 (9th Cir. 1999).

“A terminating sanction, whether default judgment against a defendant or dismissal of a 

plaintiff’s action, is very severe. . . . Only ‘willfulness, bad faith, and fault’ justify terminating 

sanctions.” ” Connecticut General, 482 F.3d at 1096 (citing Jorgensen, 320 F.3d at 912). 

Before ordering a terminating sanction, a court must warn the plaintiff and try other sanctions 

first. For example, a district court’s failure to warn a party that dismissal is being considered as a 

sanction weighs heavily against the sanction. U.S. ex rel. Wiltec Guam, Inc. v. Kahaluu Constr.

Co., 857 F.2d 600, 605 (9th Cir. 1988). Although “[a]n explicit warning is not always required, at 

least in a case involving ‘egregious circumstances,’” “[i]n other circumstances, the failure to warn 

may place the district court’s order in serious jeopardy.” Id. (citing Malone, 833 F.2d at 132–33). 

Indeed, “‘[f]ailure to warn has frequently been a contributing factor in [Ninth Circuit] decisions to 

reverse orders of dismissal.’” Id. (quoting Malone, 833 F.2d at 133). 

ORDER TO SHOW CAUSE

The plaintiff did not appear at the motions hearing on March 7, 2019 (though he subsequently 

filed an amended complaint) or the case-management conference on June 20, 2019. At the June 20 

case-management conference, the defendant represented that the plaintiff told him that he was no 

longer interested in prosecuting the case (apparently because the servicing of his loan has been 

transferred). Given these circumstances, the court orders the parties to file a written update by July 

11, 2019 that includes the plaintiff’s position on whether he wants to pursue this lawsuit. The 

Case 3:18-cv-07715-LB Document 51 Filed 06/24/19 Page 3 of 4
ORDER – No. 18-cv-07715-LB 4

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court also orders the plaintiff to appear in person on July 18, 2019, at 11:00 a.m. at 450 Golden 

Gate Avenue, 15th Floor, Courtroom B, San Francisco, California, to show cause why the court 

should not dismiss his case for his failure to prosecute it. If the plaintiff does not file the written 

update or appear, the court warns him that he faces sanctions, including monetary sanctions and, 

ultimately, dismissal of his case for his failure to prosecute it and entry of judgment in favor of the 

defendant. The plaintiff may also voluntarily dismiss his case by filing a one-page notice of 

voluntary dismissal.

IT IS SO ORDERED.

Dated: June 24, 2019

______________________________________

LAUREL BEELER

United States Magistrate Judge

Case 3:18-cv-07715-LB Document 51 Filed 06/24/19 Page 4 of 4