Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_13-cv-05164/USCOURTS-cand-4_13-cv-05164-16/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 15:1601 Truth in Lending

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United States District Court 

Northern District of California 

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

CURTIS W. ADAMS, ET AL., 

Plaintiffs, 

v. 

WELLS FARGO BANK, N.A., ET AL., 

 Defendants.

Case No.: 13-CV-5164 YGR

ORDER GRANTING MOTION TO DISMISS 

FIRST AMENDED COMPLAINT WITHOUT 

LEAVE TO AMEND 

Plaintiffs Curtis W. Adams and Francis R. Adams, acting pro se, (collectively, “the Adams” 

or “Plaintiffs”) filed their complaint against Defendant Wells Fargo Bank, N.A. (“Wells Fargo”)1 in 

the Superior Court of California, County of Alameda, on September 24, 2013. By Notice of 

Removal filed November 11, 2013, the complaint was removed to this Court. (Dkt. No. 1, Exhibit 

A, “Complaint.”) 

Wells Fargo filed a motion to dismiss all claims for relief in the original complaint. After a 

lengthy delay due to several mediation conferences, the Court granted the motion to dismiss with 

leave to amend, with the exception of the Adams’ eighth claim for violation of the Truth In Lending 

Act which was dismissed without leave to amend. (Dkt. No. 61, Order Granting Motion to Dismiss 

with Leave to Amend, entered March 30, 2015.) 

On July 9, 2015, the Adams filed a motion for extension of time to file an amended 

complaint, which the Court granted. (Dkt. Nos. 64, 65.) The Adams filed a First Amended 

 1

 Wells Fargo again seeks judicial notice of official documents establishing that World 

Savings Bank, FSB changed its name to “Wachovia Mortgage, FSB” and later merged into Wells 

Fargo Bank, N.A. (Request for Judicial Notice (“RJN”), Dkt. No. 68.) In addition, Wells Fargo 

seeks judicial notice of official records including the deed of trust, as well as this Court’s prior order 

on the motion to dismiss the original complaint. As all documents are proper subjects for judicial 

notice, the RJN is GRANTED. 

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Complaint (“FAC”) on July 27, 2015. (Dkt. No. 66.) The instant motion to dismiss the FAC 

followed. (Dkt. No. 67.) The Adams failed to file a timely opposition and the Court issued an order 

sua sponte extending the Adams’ time to respond. (Dkt. No. 69.) The Adams then filed an 

opposition, and Wells Fargo filed a reply. 

The Court, having reviewed the motion, opposition, reply, amended complaint, and other 

papers on file in this matter, and for the reasons stated herein, GRANTS the Motion to Dismiss the 

First Amended Complaint without leave to amend. The FAC does not cure the defects enumerated 

in the Court’s prior order granting leave to amend, and the Adams’ opposition does not offer any 

reason to believe that further opportunities to amend would result in a viable complaint. 

I. BACKGROUND 

On August 9, 2006, plaintiffs borrowed $365,000 from World Savings Bank, FSB (“World 

Savings”) secured by a Deed of Trust recorded against 1640 63rd Street, Berkeley, California (the 

“Property”). (RJN Exhs. B and C – Note and Deed of Trust, respectively). Effective January 1, 2008, 

World Savings was renamed Wachovia Mortgage, FSB. In November 2009, Wachovia Mortgage, 

FSB changed its name to Wells Fargo Bank Southwest, N.A., before merging into Wells Fargo Bank, 

N.A. (hereinafter collectively, “Wells Fargo”). (RJN Exh. D.) Plaintiffs allege that the “foreclosing 

party” here “did not own Plaintiffs debt because one or more of the assignments of her debt were 

void[;]...while Plaintiff[s] owed a debt to someone, they contend that they did not owe it to the entity 

that is threatening foreclosure on their home.” (FAC at 5:22-26.) 

The FAC asserts claims denoted as: (1) violation of California Civil Code section 2923.5, (2) 

slander of title, (3) intentional misrepresentation, (4) breach of contract, (5) breach of contract, (6) 

unjust enrichment, (7) unlawful business practices in violation of California Business & Professions 

Code section 17200, (8) violation of Civil Code section 2923.6, (9) defamation, (10) false light, and 

(11) intentional misrepresentation in violation of Civil Code sections 1572, 1709 and 1710.2

 

 2

 The FAC removed all paragraph numbering, making comparisons between the original 

complaint and FAC challenging. Also, a number of the general preamble paragraphs of the FAC 

repeat earlier paragraphs. (Compare FAC at 9:2-10:5 and 10:15-11:19.) 

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II. APPLICABLE STANDARD

A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the claims alleged in 

the complaint. Ileto v. Glock, Inc., 349 F.3d 1191, 1199–1200 (9th Cir. 2003). “Dismissal 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. 1990). All 

allegations of material fact are taken as true and construed in the light most favorable to the 

plaintiffs. Johnson v. Lucent Techs., Inc., 653 F.3d 1000, 1010 (9th Cir. 2011). To survive a motion 

to dismiss, “a complaint must 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 Bell Atl. 

Corp. v. Twombly, 550 U.S. 544, 557 (2007)). This “facial plausibility” standard requires the 

plaintiffs to allege facts that add up to “more than a sheer possibility that a defendant has acted 

unlawfully.” Iqbal, 556 U.S. at 678. While courts do not require “heightened fact pleading of 

specifics,” plaintiffs must allege facts sufficient to “raise a right to relief above the speculative 

level.” Twombly, 550 U.S. at 555. “[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.

In deciding whether the plaintiffs have stated a claim upon which relief can be granted, the 

court must assume that the plaintiffs’ allegations are true and must draw all reasonable inferences in 

the plaintiffs’ favor. See Usher v. City of Los Angeles, 828 F.2d 556, 561 (9th Cir. 1987). However, 

the court is not required to accept as true “allegations that are merely conclusory, unwarranted 

deductions of fact, or unreasonable inferences.” In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 

(9th Cir. 2008). 

 In addition, claims based upon fraud must satisfy a heightened pleading standard under which 

“a party must state with particularity the circumstances constituting fraud or mistake.” Fed.R.Civ.P. 

9(b). The allegations must include “an account of the time, place, and specific content of the false 

representations as well as the identities of the parties to the misrepresentations.” Swartz v. KPMG

LLP, 476 F.3d 756, 765 (9th Cir. 2007). And they must be specific enough to give a defendant 

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notice of the particular misconduct alleged to constitute the fraud such that the defendant may defend 

against the charge. Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir.1985). 

III. ANALYSIS 

As a general matter, a great deal of the FAC is simply broad, general pronouncements about 

non-judicial foreclosures, the history of the real estate boom and bust, the societal benefits of 

homeownership and the like—not allegations of material facts to establish any claim that plaintiffs 

are entitled to relief for a violation of the law. Parts of the pleading appear to have been copied 

directly from other briefs and legal articles, and are not tied to the actions of the parties here by any 

facts alleged. Reading the FAC liberally but with the applicable pleading standards in mind, and 

bearing in mind that Plaintiffs have already been given an opportunity to amend the allegations, the 

Court now examines each claim in turn. 

A. First Claim for Relief - California Civil Code § 2923.5 

Plaintiffs previously attempted to state claims for violation of California Civil Code section 

2923.5, violation California Business and Professions Code section 17200 (“the UCL”), and 

intentional misrepresentation, all based on alleged failure to comply with the legal prerequisites to 

foreclosure set forth in section 2923.5. In granting the motion to dismiss the complaint, the Court 

directed Plaintiffs to allege the defects in the foreclosure process more clearly in any amended 

complaint. 

The allegations in Plaintiffs’ amended claim for violation of section 2923.5 now add several 

pages of discussion concerning housing policy and the reasons for enactment of the Homeowners’ 

Bill of Rights legislation. The FAC also alleges that Defendants deliberately and intentionally 

entrapped Plaintiffs into a bad faith loan, and that the sale of their loan as a mortgage-backed security 

meant that they could no longer communicate with the owner of the loan, but only the servicer. The 

only factual allegations tied to the conduct of the parties here are that defendants and each of them 

engaged in egregiously unfair and deceptive lending practices to “steer” Plaintiffs into their loan, and 

that Plaintiffs are attempting to obtain a loan modification. While labeled as a claim under section 

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2923.5, Plaintiffs also allege that defendants’ conduct constituted unlawful business practices 

prohibited by the UCL. 

The allegations fail to state either a claim under section 2923.5 or the UCL. In granting the 

motion to dismiss, Plaintiffs were given direction to amend their allegations “to allege any false 

statements in the Notice of Default with sufficient particularity, as well as the particulars of any other 

defects in the Notice of Default in violation of section 2923.5.” (Order, Dkt. No. 61, at 7.) Plaintiffs 

have not done so. The new allegations, like those in the original complaint, are conclusory and do 

not assert any particular actions by Wells Fargo. The FAC does not allege facts indicating that Wells 

Fargo failed either to contact, or diligently attempt to contact, Plaintiffs prior to filing a notice of 

default as required by section 2923.5. Nor do Plaintiffs allege the details of any unfair fraudulent, 

unfair, or unlawful conduct directed at them by Wells Fargo. The generalized allegations in the 

FAC, which do not state facts related to any conduct between Plaintiffs and Wells Fargo, are simply 

insufficient to state a claim, regardless of the theory Plaintiffs intended to state. 

Further, to the extent that the claim is based upon steering Plaintiffs into a loan or other 

conduct at the inception of the loan, it would be time-barred, since Plaintiffs entered into their loan 

more than four years ago. See Cal. Bus. & Prof. Code § 17208, Cal. Code Civ. Proc. § 338. As a 

result, Plaintiffs’ first claim fails. 

B. Second Claim for Relief – Slander of Title 

In dismissing this claim in the original complaint, Plaintiffs were warned that their allegations 

of falsity and misrepresentation were too vague and generalized and that any amended complaint 

would need to allege a “basis for avoiding the qualified common interest privilege in section 47(c)(1) 

on their slander of title claim.” (Order at 7.) Plaintiffs’ FAC fails on both counts. Plaintiffs do not 

allege any false publication by Wells Fargo, much less one that would not be privileged. Instead, 

they allege that “defendant” was involved in a national trend of highly exaggerated property values, a 

proliferation of extremely risky loan instruments, fraudulent inducement and coercion to enter into 

these debt traps” which led to major economic collapse in the nation and to Plaintiffs’ “ensnarement” 

in a mortgage with excessive finance charges. (FAC at 18:1-19.) These allegations do not state a 

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claim for slander of title, or any readily cognizable claim against Wells Fargo. And, again, since the 

allegations seem to focus on initiation of the loan, they would be time-barred under a three- or fouryear statute of limitations. 

C. Third Claim for Relief – Intentional Misrepresentation 

Plaintiffs’ allegations in the FAC are focused on their claim that the deed of trust here was 

securitized and converted into a mortgage-backed security. Plaintiffs allege that they signed the deed 

of trust without understanding its true nature and that the designated beneficiary, Mortgage 

Electronic Registration Systems, Inc. was not legally authorized to conduct business in the State of 

California. Plaintiffs argue that this makes their deed of trust void and voidable. 

The allegations here are insufficient to state a claim of intentional misrepresentation. 

Plaintiffs do not allege false statements made to them by Wells Fargo, nor do they allege the 

particulars of any fraudulent conduct under the higher pleading standard required for such 

allegations. See Moore v. Kayport Package Express, Inc., 885 F.2d 531, 549 (9th Cir. 1989); Fed. R. 

Civ. P. 9(b). Thus, the FAC fails on this claim as well. 

D. Fourth Claim – Breach of Contract 

Plaintiffs’ new Fourth Claim for Relief in the FAC, labeled as one for breach of contract, 

asserts that “Plaintiffs have properly alleged that Defendants have breached the provisions within the 

note and deed of trust with regard to Defendants obligation to apply payments made by Plaintiffs to 

interest and principal...[and] Defendants’ demurrer should be overruled.” (FAC at 20:24-21:4.) The 

FAC alleges no facts in support of this breach of contract claim, but instead seems to have copied 

language from a brief in opposition to a demurrer in state court. The new allegations do nothing to 

cure the defects the Court previously identified in the original complaint and, indeed, compound the 

defects in the claim. 

E. Fifth Claim for Relief - Breach of Contract 

Plaintiffs’ Fifth Claim for Relief is also labeled “breach of contract.” The Court dismissed 

the Adams’ prior claim for breach of contract because it alleged no more than that defendants had 

refused to agree to a loan modification. Plaintiffs’ amended breach of contract claim (Fifth Claim 

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for Relief) repeats this same allegation, but adds two new sets of allegations: (1) that “Defendants” 

used language “that inferred that they would assist in lowering Plaintiffs [sic] loan payments within 

affordable and sustainable ranges” but never intended to do so; and (2) a lengthy exposition on 

various forms of “Predatory Loan Modifications” whereby servicers “often” accept trial payments 

knowing a modification will be denied, and stating that World Savings...would contact a borrower 

and offer sham modification deals. (FAC 23:19-24:19.) 

The allegations Plaintiffs added are general and conclusory, never stating any particular 

conduct of Wells Fargo in relation Plaintiffs. The FAC alleges “common practices” and “usual” 

conduct, but never what actually happened here. More significantly, the FAC still does not allege 

the contract between Plaintiffs and defendants, its terms, or how it was breached. Thus, the FAC 

does not cure the deficiencies in this claim that the Court previously identified. 

F. Sixth Claim for Relief – Unjust Enrichment 

The Court previously dismissed Plaintiffs’ claim for unjust enrichment because it simply 

incorporated all other allegations without alleging any facts, making the basis for the claim 

unintelligible. In the FAC, Plaintiffs now allege that Wells Fargo has been unjustly enriched at their 

expense because it “purposely misled Plaintiffs” and provided a Deed of Trust that is “wrought with 

ambiguities and errors...[and] engineered to be fraudulent.” (FAC at 25:7-14.) A common law 

claim for unjust enrichment or restitution requires a plaintiff to plead receipt of a benefit and unjust 

retention of that benefit by defendant at the expense of the plaintiff. Lectrodryer v. SeoulBank, 77 

Cal. App. 4th 723, 726 (2000).3

 The FAC fails to allege any facts to establish that Wells Fargo 

 3

 California authorities consistently recognize a common law claim based on principles of 

reimbursement due to unjust enrichment. See, e.g. Hartford Cas. Ins. Co. v. J.R. Mktg., L.L.C., 61 

Cal. 4th 988, 998 (2015) (discussing cause of action for unjust enrichment entitling plaintiff to 

reimbursement); Hirsch v. Bank of Am., 107 Cal. App. 4th 708, 721-22 (2003) (plaintiffs stated “a 

valid cause of action for unjust enrichment based on” the defendants’ unjust retention of fees at the 

expense of plaintiffs); Lectrodryer, 77 Cal.App.4th at 726 (plaintiff “satisfied the elements for a 

claim of unjust enrichment” by alleging receipt and unjust retention of a benefit at the expense of 

another); see also RESTATEMENT (THIRD) OF RESTITUTION AND UNJUST ENRICHMENT § 1 (2011) (“A 

person who is unjustly enriched at the expense of another is subject to liability in restitution.”). 

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unjustly retained any benefit from Plaintiffs. While they again loosely allege fraud, Plaintiffs do not 

allege any specifics of any fraudulent conduct, as they must in order to state a viable claim. Thus, 

the unjust enrichment claim fails. 

G. Seventh Claim -- Violation of Business & Professions Code § 17200 

Plaintiffs’ Seventh Claim for violation of Business & Professions Code § 17200 in the 

original complaint was based on allegations that Wells Fargo engaged in “fraudulent business.” 

Most of the allegations were generalized and had no specific tie to the Plaintiffs, such as allegations 

that defendants: promise homeowners loan modifications that they have no intention of actually 

providing; refuse to agree to reasonable debt reduction terms; demand unnecessary documents; and 

demand payments when a foreclosure had already taken place. The only allegations that were even 

marginally specific to Plaintiffs were that “defendants” intentionally misle[d] Plaintiffs’ into 

believing that a foreclosure had not occurred or had been entered in error.” (Original Complaint ¶ 

59.) The Court dismissed the claim on the grounds that Plaintiffs allegations of falsity were vague 

and generalized and, to the extent they include allegations of fraud or misrepresentation, did not 

allege the facts of such misrepresentations with the necessary specificity. 

The FAC repeats the original allegations of this claim verbatim. Having failed to amend the 

claim to cure the defects, it must be dismissed. 

H. Eighth Claim – Civil Code § 2923.6 

While the Eighth Claim in the FAC is entitled “Violation of Civil Code § 2923.6,” Plaintiffs 

do not allege the elements of such a claim or any facts to establish those elements. Instead, Plaintiffs 

repeat the identical allegations as were stated in their Seventh Claim. 

A claim under section 2923.6 would require Plaintiffs to allege that they had completed an 

application for a first lien loan modification and that a notice of default had been filed without 

following the timelines and review procedures set forth in the statute. See Cal. Civ. § 2923.6(c)-(e). 

Plaintiffs do not allege such facts, in this claim or elsewhere in their FAC. The Eighth Claim 

therefore fails. 

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I. Ninth and Tenth Claims – Defamation and False Light 

Although the Adams’ claims for defamation and false light were dismissed previously by the 

Court with leave to amend, they failed to amend the claims in the FAC. The allegations in the Ninth 

and Tenth Claims simply repeat the exact same allegations as in the original Complaint. As the 

Court stated previously, with respect to the defamation and false light claims, the Adams were 

required to allege the false information at issue, that the information published was false, and that it 

was published by defendant with malice or a willful intent to cause injury. Gorman v. Wolpoff & 

Abramson, LLP, 584 F.3d 1147, 1168 (9th Cir. 2009). Because Plaintiffs did not amend the deficient 

allegations of these claims, they must be dismissed. 

J. Eleventh Claim – Intentional Misrepresentation in Violation of 

Civil Code §§ 1572, 1709 and 1710 

In their claim for Intentional Misrepresentation in the original Complaint [formerly their 

Fourteenth Cause of Action], Plaintiffs alleged that they requested a modification of their loan, but 

Wells Fargo failed to contact or reasonably engage them in a process to explore alternatives to 

foreclosure. Plaintiffs further alleged that “Wells Fargo Bank’s abrasive, deceptive, and evasive 

conduct alleged herein violated is a willful and intentional violation of California Civil Code §§ 1572 

[actual fraud], 1709 [fraudulent deceit], and 1710[deceit].” (Complaint ¶ 103.) Like other claims 

alleging fraud, the Court dismissed this claim for failure to allege fraud and misrepresentation with 

the specificity required. 

The allegations of the FAC repeat those in the original Complaint and add conclusory 

assertions that the original credit grantor and subsequent acquirers and servicers did willfully and 

intentionally engage in business activities in violation of several federal statutes (i.e., 15 U.S.C. § 

78ff; “16 USC § 1692a”; 18 U.S.C. § 1001, 1002; and 42 U.S.C. § 1986). None of the referenced 

federal statutes bear any relation to the allegations here. The FAC does not state factual allegations 

of misrepresentation, much less factual allegations meeting the heightened fraud pleading standard. 

Nor does the FAC state facts to establish a claim for violation of section 2923.5 (concerning 

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contacting borrowers about foreclosure alternatives) or 2923.6 (concerning notifying borrowers of 

the results of a loan modification application). 

IV. CONCLUSION 

 In summary, Plaintiffs have failed to allege facts to state a claim. Although it is apparent 

from the allegations in the FAC that Plaintiffs wish to contest the foreclosure on their home, and to 

obtain damages arising therefrom, Plaintiffs do not allege facts to support any legal theory entitling 

them to such relief. Wells Fargo’s Motion to Dismiss the FAC is therefore GRANTED WITHOUT 

LEAVE TO AMEND. 

The action herein is DISMISSED. Judgment in favor of Wells Fargo and against the Adams 

shall be entered. 

This terminates Dkt. No. 66. 

IT IS SO ORDERED. 

Dated: October 26, 2015 

_________________________________________ 

YVONNE GONZALEZ ROGERS

UNITED STATES DISTRICT COURT JUDGE

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