Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_09-cv-00748/USCOURTS-azd-2_09-cv-00748-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Breach of Contract

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1 Plaintiff has been unable to serve Gabriela Mata, who has since filed bankruptcy,

and Abagale Gullickson, who is no longer married to Defendant Henkels. Plaintiff has since

requested that these parties be dismissed without prejudice. (Dkt. # 20.)

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

ING BANK, FSB, a federally-chartered

savings bank, 

Plaintiff, 

vs.

GABRIELA MATA, an individual;

ROYAL FINANCIAL ARIZONA INC.,

an Arizona corporation; NICHOLAS A.

HENKELS and Abagale Gullickson,

former husband and wife,

Defendants. 

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No. CV-09-748-PHX-GMS

ORDER

Pending before the Court is Defendants Royal Financial Arizona’s and Nicholas

Henkels’ Motion to Dismiss.1

 (Dkt. # 12.) For the following reasons, the Court grants the

motion in part and denies it in part.

BACKGROUND

In August 2006, ING Bank, FSB (“ING”) purportedly entered into a “Broker

Origination Agreement” with RFA, in which ING committed to fund residential mortgage

loan application packages submitted by RFA if those application packages met certain

criteria. RFA was obligated to perform certain duties, including obtaining, analyzing, and

Case 2:09-cv-00748-GMS Document 26 Filed 12/03/09 Page 1 of 13
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2

 A full-credit bid is one in which the beneficiary on a deed of trust “purchases” the

property at a deed of trust sale by bidding at least the full amount owed on the debt and

crediting the debt toward the sale purchase price.

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verifying information from each prospective borrower to ensure each borrower met all

applicable criteria. As part of the agreement, RFA represented that the information submitted

was correct and that nothing would adversely affect the loans’ values or cause the loans to

become delinquent. RFA also agreed not to submit any loan packages that were false or

fraudulent.

In May 2007, RFA presented to ING a loan package for Mata, in which Mata sought

a refinanced first mortgage in the amount of $1,424,000. Henkels, on behalf of RFA,

originated the loan, interviewed Mata, and assisted with the preparation and submission of

her application. The loan application represented that Mata’s monthly income was $29,000,

that her net worth was $507,195, that the owned real estate included two properties, and that

Mata would use the property as her primary residence. Relying on these representations,

ING loaned Mata the requested funds.

Further investigation revealed that, contrary to the loan application, Mata never

intended to occupy the property and Mata’s income for 2007 was only $44,828. Mata made

only one payment on the property, and ING instituted a trustee sale on May 30, 2008, in

which it made a full-credit bid for $1,511,484.2

ING filed suit nearly a year later on April 13, 2009, alleging nine claims (only seven

of which were against either RFA or Henkels): (1) Breach of Contract; (2) Negligence; (3)

Breach of Fiduciary Duty; (4) Fraudulent Misrepresentation/Omission; (5) Negligent

Misrepresentation/Nondisclosure; (6) Unjust Enrichment; and (7) Attorneys’ Fees. Plaintiff

seeks “damages in the amount of $1,567,609, which is the difference between the amount

outstanding on the original Mata Loan on which only one (1) principal payment was made

and the net amount ING obtained through the sale of the Property.” (Dkt. # 1 at 15.) In

addition, ING alleged that it “suffered damages due to the loss of interest and other income

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on the Mata Loan, as well as expenses for real estate taxes, insurance, and other similar

items.” (Id.)

DISCUSSION

I. Legal Standard for Motion to Dismiss 

To survive dismissal for failure to state a claim pursuant to Rule 12(b)(6), a complaint

must contain more than “labels and conclusions” or a “formulaic recitation of the elements

of a cause of action”; it must contain factual allegations sufficient to “raise the right of relief

above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). While

“a complaint need not contain detailed factual allegations . . . it must plead ‘enough facts to

state a claim to relief that is plausible on its face.’” Clemens v. DaimlerChrysler Corp., 534

F.3d 1017, 1022 (9th Cir. 2008) (quoting Twombly, 550 U.S. at 570). “A claim has facial

plausibility when the plaintiff pleads factual content that allows the court to draw the

reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v.

Iqbal, 129 S. Ct. 1937, 1949 (2009) (citing Twombly, 550 U.S. at 556). The plausibility

standard “asks for more than a sheer possibility that a defendant has acted unlawfully.

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 555) (internal citations omitted).

When analyzing a complaint for failure to state a claim under Rule 12(b)(6), “[a]ll

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

nonmoving party.” Smith v. Jackson, 84 F.3d 1213, 1217 (9th Cir. 1996). In addition, the

Court must assume that all general allegations “embrace whatever specific facts might be

necessary to support them,” Peloza v. Capistrano Unified Sch. Dist., 37 F.3d 517, 521 (9th

Cir. 1994), but the Court will not assume that the plaintiff can prove facts different from

those alleged in the complaint, see Associated Gen. Contractors of Cal., Inc. v. Cal. State

Council of Carpenters, 459 U.S. 519, 526 (1983); Jack Russell Terrier Network of N. Cal.

v. Am. Kennel Club, Inc., 407 F.3d 1027, 1035 (9th Cir. 2005). Similarly, legal conclusions

couched as factual allegations are not given a presumption of truthfulness, and “conclusory

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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). 

II. Full-Credit Bid Rule

A. Arizona law governs the deed of trust sale.

Defendants argue that Arizona’s full-credit bid rule bars ING’s claims. Plaintiff first

contends, however, that the law of Delaware, not the law of Arizona, governs its claims

because the contract contains a choice-of-law provision. This is incorrect. “In a diversity

case, the district court must apply the choice-of-law rules of the state in which it sits.”

Abogados v. AT&T, Inc., 223 F.3d 932, 934 (9th Cir. 2000). Because this Court sits in

Arizona, the Court must apply Arizona’s choice-of-law rules. Under Arizona law, “the law

chosen by the parties governs unless that law is contrary to the fundamental policy of a state

with a materially greater interest in the issue.” See Landi v. Arkules, 172 Ariz. 126, 130, 835

P.2d 458, 462 (Ct. App. 1992). The Broker Origination Agreement between ING and RFA

states, “This Agreement shall be governed by the laws of the State of Delaware, without

reference to its principles of conflict of laws.” Despite the choice-of-law clause, however,

Plaintiff necessarily conducted the trustee’s sale pursuant to Arizona law because Delaware

has no equivalent to Arizona’s deed of trust sale. Arizona law defines the rights and

procedures pertaining to the sale of the deed of trust in this case. Thus, Arizona thus has a

“materially greater interest,” indeed the only interest, in having its law apply to deeds of

trust, and applying Delaware law to an Arizona deed of trust sale would be “contrary to the

fundamental policy” of Arizona.

B. The full-credit bid rule bars ING’s claims only to the extent they are

based on the loan amount.

 Defendants contend ING suffered no damages as a matter of law because ING’s fullcredit bid at the deed of trust sale fully satisfied any deficiency on Mata’s loan obligation to

ING. Arizona’s antideficiency statute caps deficiency judgments at the total amount owed

on the loan less the greater of the property’s fair market value or the sale price at the trustee’s

sale. Ariz. Rev. Stat. § 33-814(A). The antideficiency statute also establishes that in the

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absence of an action to recover a deficiency judgment within ninety days, a foreclosure sale

price is deemed to be in full satisfaction of the underlying obligation and prohibits any other

action to recover a deficiency. Id. § 33-814(D) (“If no action is maintained for a deficiency

judgment within [ninety days], the proceeds of the sale, regardless of amount, shall be

deemed to be in full satisfaction of the obligation and no right to recover a deficiency in any

action shall exist.”) (emphasis added). Therefore, where a creditor has not filed a timely

deficiency action against the debtor, the credit bid is deemed to fully satisfy the note whether

it is for the full loan amount or not, and the creditor has no right to recover a deficiency in

any action.

This result is consistent with an Arizona District Court case discussing Arizona’s fullcredit bid rule. 333 W. Thomas Med. Bldg. Enters. v. Soetantyo, 976 F. Supp. 1298 (D. Ariz.

1995), aff’d 111 F.3d 138 (9th Cir. 1997). In that case, a lender foreclosed on a deed of trust

that had been executed in its favor when the lender had issued a loan to several borrowers.

Id. at 1299. The lender then made a full-credit bid at the sale and eventually sold the

property to another buyer at a loss. Id. The lender claimed the property had declined in value

due to the borrowers’ waste, and the lender brought an action for waste, along with claims

for negligence, breach of contract, and breach of fiduciary duty. Id. The borrowers moved

for summary judgment on the theory that the lender’s debt had been satisfied by its full-credit

bid. Id. at 1300. Citing Arizona Revised Statute Section 33-814, among other authority, the

borrowers contended that the full-credit bid extinguished any claims based on that debt.

Soetantyo, 976 F. Supp. at 1300. While the court found that Section 33-814 technically did

not prohibit an action for waste against the borrower, the court found that there were, as a

matter of law, no damages because “the very definition of a waste action preclude[d] Plaintiff

from recovering.” Soetantyo, 976 F. Supp. at 1300. As the court noted,“an action for waste

brought by a beneficiary under a deed of trust is based upon the assumption that the trust

deed as security has been impaired,” “the measure of damages for waste is the amount by

which the security is impaired—that is, the amount by which the value of the security is less

than the outstanding indebtedness.” Id. The lender’s claim was extinguished because the

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3 Soetantyo arguably draws a distinction between Arizona’s antideficiency statute and

the full-credit bid rule. The Court need not decide whether a separate, common law fullcredit bid rule exists, however. It is sufficient that the antideficiency statute prohibits any

attempt to recover a deficiency in any action. Ariz. Rev. Stat. § 33-814(D).

4

 Plaintiff makes no allegation that fraud or misrepresentation caused it to make the

full-credit bid (notwithstanding its argument that it was initially induced into the loan

agreement). 

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full-credit bid prevented the lender from showing any impairment to the security (and thus

from showing any damages resulting from the loan). Id. The court also granted summary

judgment on the negligence, breach of contract, and breach of fiduciary duty claims because

those claims were “predicated entirely upon [the lender’s] interest under the deed of trust,”

which “were fully and expressly satisfied by the full-credit bid.” Id. at 1301. The court found

that because the lender “failed to demonstrate that its interest under the deed of trust was

damaged, it failed to establish an essential element to each of its remaining claims.” Id.

Soetantyo explained that this rule is not overly-harsh on deed-of-trust beneficiaries, who have

the option of making a full-credit bid or bidding what the beneficiary assesses to be the

property’s fair market value and subsequently suing for a deficiency. If the beneficiary bids

less than the full amount owing, then the beneficiary might have a claim for damages if it

brought a deficiency claim in a timely manner. Soetantyo, 976 F. Supp. at 1301. But that was

not the case in Soetantyo.3

Nor is it the case here. Like the lenders in Soetantyo, Plaintiff chose to make a fullcredit bid at the deed of trust sale and chose not to try to bring a deficiency judgment (if one

had been available) within ninety days. The trustee sale occurred in May 2008, and Plaintiff

filed this lawsuit nearly a year later, in April 2009. Plaintiff also could have bid a different

amount if it assessed the fair market value to be lower and then sued for the loss in a timely

manner, but Plaintiff chose not to do so.4

 By making such a bid, Plaintiff received the

property in exchange for extinguishing Mata’s debt and the security interest. As a result,

Plaintiff cannot, as matter of law, assert any damages based on the value of the property. 

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5

 Section 33-814(A) allows deficiency judgments against “any person directly,

indirectly or contingently liable on the contract for which the trust deed was given as

security.” Ariz. Rev. Stat. § 33-814(A).

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Plaintiff contends that although this rule might protect debtors, it does not protect

third parties who allegedly induced the lender to enter the loan agreement in the first place.

Plaintiff contends that Section 33-814(A), by its terms, addresses deficiency judgments

against borrowers, but not against third parties, such as RFA and Henkels.5

 Ariz. Rev. Stat.

§ 33-814(A). However, the plain language of the antideficiency statute demonstrates

otherwise. Ariz. Rev. Stat. § 33-814(D). First, the statute states the sale proceeds shall be

deemed a “full satisfaction” of the obligation. Id. If a credit-bid fully satisfies the obligation,

then the creditor cannot sue third parties for damages based on any alleged deficiency in the

payment of that obligation. Next, the statute prohibits a right to recover an asserted

deficiency in “any action.” Id. By its plain terms, this language mandates that, just as

creditors cannot seek to recover a deficiency against the debtor, they cannot seek to recover

deficiency damages in any other action. This protection plainly applies to third parties. 

Other states have also held that their full-credit-bid rules apply to third parties. Cf. Michelson

v. Camp, 72 Cal.App.4th 955, 963, 85 Cal.Rptr.2d 539, 544 (Ct. App. 1999) (applying the

full-credit-bid rule to third parties).

Plaintiff cites two cases for the proposition that the rule does not apply to third parties.

These cases, however, are distinguishable. In Long v. Corbet, a junior lender sued a

guarantor for a deficiency after the junior lender had already received excess funds gained

by a senior lender’s deed of trust sale. 181 Ariz. 153, 158–59, 888 P.2d 1340, 1345–46 (Ct.

App. 1994). However, the lender in that case did not voluntarily make a full-credit bid itself,

but rather received excess funds from another lender’s deed of trust sale; the court noted that

“[t]here was no sale pursuant to [the junior lender’s] trust deed, nor did [the junior lender]

receive the proceeds directly from the sale.” Id. at 158, 888 P.2d at 1345. Moreover, the

excess funds did not cover the full amount of the debt, and the junior lender thus could seek

a deficiency from the guarantor. Id., 888 P.2d at 1345. In contrast, the Plaintiff here

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6

 At the time, Washington’s statute, RCW 61.24.100, stated, “Foreclosure, as in this

chapter provided, shall satisfy the obligation secured by the deed of trust foreclosed,

regardless of the sale price or fair value, and no deficiency decree or other judgment shall

thereafter be obtained on such obligation. Where foreclosure is not made under this chapter,

the beneficiary shall not be precluded from enforcing the security as a mortgage nor from

enforcing the obligation by any means provided by law.”

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conducted the sale of the deed of trust, rather than being forced into such proceedings by a

senior lender. Further, Plaintiff bid an amount that extinguished the entire debt, rather than

only part of the debt as in Long. 

Plaintiff also cites Glenham v. Palzer, which held that Washington’s antideficiency

statute did not immunize third parties from suit, regardless of a full credit bid. 58 Wash.App.

294,298, 792 P.2d 551, 553 (Wash. Ct. App. 1990).6

 For the reasons stated above, however,

the Court does not read the Arizona statute as narrowly as Glenham interpreted the

Washington statute. A full-credit bid would result in no deficiency judgment against a debtor

because the difference between the amount owed on a debt and the amount bid at a sale

would be zero. Ariz. Rev. Stat. § 33-814. Further, the Arizona statute prohibits a creditor

from seeking to recover the deficiency in any other action if it does not seek a deficiency

judgment (if one would otherwise be available) within ninety days. Id. As against third

parties, a full-credit bid would prevent a lender from asserting any damages based on the loan

because the difference between the amount owed on the debt and the amount bid (and thus

the price to which the lender voluntarily agreed) would be zero. Plaintiff chose its price, and

it would be unjust to allow it to seek to recover the loan deficiency from a third party after

already extinguishing the entire debt at the deed of trust sale. See also Nussbaumer v.

Superior Court, 107 Ariz. 504, 507, 489 P.2d 843, 846 (1971) (recognizing that a full-credit

bid implicitly satisfies a mortgagee’s interest, precluding any further action to recover for

loss of security).

Second, Plaintiff argues the antideficiency statute is inapplicable because it seeks

neither a deficiency judgment nor damages based on any impairment of the security.

Plaintiff contends instead that it seeks damages for “Defendants’ fraudulent and tortious

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conduct” and “misrepresentations and actions made before ING funded the loan.” (Dkt. # 14

at 15–16.) It appears, however, that Plaintiff’s damages for its claims stem, at least in

substantial part, on an asserted deficiency in the payment of the debt. While Plaintiff’s

claims for fraud and tortious conduct survive to the extent that they assert damages not

resulting from the loan deficiency, Plaintiff cannot recover damages that result from an

alleged deficiency in the amount of the loan to Mata. Because Plaintiff has survived a

motion to dismiss, at least in part, the Court now considers Defendants’ contention that

several of Plaintiff’s claims are nonetheless substantively defective.

III. Plaintiff’s Negligence Claims Survives.

Defendants contend they owed no tort duty to Plaintiff because “the negligence claim

is identical to the breach of contract claim.” Defendants argue that tort damages are

recoverable for breach of contract only where there is a “special relationship.” The Court

denies the motion, however, because it appears Plaintiff has pled its remaining claims, at

least in part, as an alternative to its breach of contract claim. Defendants in a footnote

suggest it is possible that no binding contract exists at all. See Dkt. # 12 at 2 (“[T]he contract

was not executed by RFA [and] the contract is not even signed by the Bank, so for [those]

reasons it is not enforceable. But, for purposes of this motion, RFA and Henkels assume the

truth of the allegation that the contract was in force . . . .”). If no contract exists, then

Plaintiffs may nonetheless sue in tort for essentially the same conduct, but these tort claims

would not be “identical to the breach of contract claim” if no contract claim remained.

Therefore, the Court denies the motion because it is possible a tort claim exists independently

from any contract claim.

IV. Plaintiff’s Negligent Misrepresentation Claim Survives.

For the same reason, the Court denies Defendants’ motion regarding the negligent

misrepresentation claim. Defendants contend the economic loss rule bars the negligent

misrepresentation claim because “these claims are the same claims that [Plaintiff] makes in

its breach of contract claim.” But if no contract claim remains, then Plaintiff is permitted to

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plead in the alternative. The Court denies the motion without deciding whether the economic

loss rule applies.

V. Plaintiff’s Unjust Enrichment Claim Survives.

Although an unjust enrichment claim is unavailable where there is a contract between

the parties, an unjust enrichment claim can provide a remedy when a contract is

unenforceable. Trustmark Ins. Co. v. Bank One, N.A., 202 Ariz. 535, 542, 48 P.3d 485, 492

(Ct. App. 2002). Because Plaintiff may plead unjust enrichment in the alternative to its

breach of contract claim, the Court denies the motion on this ground.

VI. Plaintiff’s Fiduciary Duty Claim Fails.

Defendants contend Plaintiff’s Fiduciary Duty claim fails because it is based only on

the faulty assertion that RFA and Henkels were Plaintiff’s agents. “[A]n agent is one who

acts on behalf of another.” SE Ariz. Med. Ctr. v. AHCCCS, 188 Ariz. 276, 282, 935 P.2d 854,

860 (Ct. App. 1996) (internal quotations omitted). Meanwhile, a “fiduciary relationship is

a confidential relationship whose attributes include great intimacy, disclosure of secrets, [or]

intrusting of power.” Standard Chartered PLC v. Price Waterhouse, 190 Ariz. 6, 24, 945

P.2d 317, 335 (Ct. App. 1996). Although the existence of a fiduciary relationship depends

on the totality of the circumstances, SE Ariz. Med., 188 Ariz. at 282, 935 P.2d at 860,

Plaintiff still must plead circumstances that could establish a fiduciary relationship. See

Iqbal, 129 S. Ct. at 1950.

The Complaint asserts, “As agents of ING, Royal Financial and Henkels owed . . .

duties to ING . . . The parameters of this duty are further demonstrated by the terms of the

Agreement.” (Dkt. # 1 at 19.) The Complaint, however, alleges no facts to establish that

RFA or Henkels acted on Plaintiff’s behalf as agents. The Complaint alleges that a contract

existed, that RFA provided information and services to Plaintiff, and that Plaintiff relied on

RFA’s knowledge and expertise. This alone is insufficient to plead an agency relationship

because “[m]ere trust in another’s competence or integrity does not suffice” to create such

a relationship. Standard Chartered, 190 Ariz. at 24, 945 P.2d at 335. 

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Moreover, the contract, which is incorporated by Plaintiff’s reference to it in the

Complaint, actually alleges that no agency relationship existed. Where a “contract [is]

attached to the complaint and incorporated” into the complaint, the Court need not “accept

as true conclusory allegations in the complaint which are contradicted by the clear import of

the contract itself.” Wyler Summit P’ship v. Turner Broad. Sys., Inc., 135 F.3d 658, 665 (9th

Cir. 1998). The contract states that “[t]his Agreement and transactions entered into pursuant

hereto shall not create between [the parties] a relationship of agency” and that RFA is

“expressly prohibited from holding itself out as an agent.” Therefore, because the contract’s

plain language negates the unsupported allegation that an agency relationship exists, the

Court dismisses the Fiduciary Duty claim.

VII. Plaintiff’s Attorneys’ Fees Claim Survives Against RFA, but not Against

Henkels.

Plaintiff’s Attorneys’ Fees claim appears to allege not only attorneys’ fees based on

breach of contract, but also based on several other theories against Henkels individually.

Generally, “attorneys’ fees are not recoverable unless they are expressly provided for either

by statute or contract.” Cortaro Water Users’ Ass’n v. Steiner, 148 Ariz. 314, 316, 714 P.2d

807, 809 (1986). Plaintiff may seek attorneys’ fees for breach of contract against RFA

because, under Arizona law, “[i]n any contested action arising out of a contract, express or

implied, the court may award the successful party reasonable attorney fees.” A.R.S. § 12-

341.01(A).

As to Henkels, however, Plaintiff’s claim for attorneys’ fees fails. The Attorneys’ Fees

claim asserts that “because Henkels is the alter ego of Royal Financial and participated in the

tortious acts that constitute a breach of the Agreement, equity demands that Henkels be

bound by the Agreement and obligations to reimburse ING for its damages along with its

attorneys’ fees and litigation expenses.” (Dkt. # 1 at 24.) “The alter-ego status is said to exist

when there is such unity of interest and ownership that the separate personalities of the

corporation and owners cease to exist.” Dietel v. Day, 16 Ariz.App. 206, 208, 492 P.2d 455,

457 (Ct. App. 1972) (internal quotations omitted). Although “[a]lter ego determinations are

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highly fact-based,” Legacy Wireless Servs., Inc. v. Human Capital, L.L.C., 314 F. Supp. 2d

1045 (D. Or. 2004), “[c]onclusory allegations of ‘alter ego’ status are insufficient to state a

claim” because “a plaintiff must allege specifically [the facts and elements of an alter-ego

claim].” Neilson v. Union Bank of Cal., N.A., 290 F. Supp. 2d 1101, 1116 (C.D. Cal. 2003);

see also Twombly, 550 U.S. at 555 (requiring more than “labels and conclusions” to survive

a motion to dismiss). Plaintiff has not alleged facts to make an alter-ego claim plausible.

The assertion in the Attorneys’ Fees claim is a blanket label; it also does not reference any

facts in the rest of the Complaint that would support such a label, and, even if it had, the

remainder of the Complaint has insufficient factual detail of Henkels’s interest and

ownership. Even if discovery might reveal facts supporting an alter-ego claim, “Rule 8 . .

. does not unlock the doors of discovery for a plaintiff armed with nothing more than

conclusions.” Iqbal, 129 S. Ct. at 1950.

The Attorneys’ Fees claim also seeks to make Henkels liable under ING’s contract

with RFA because of “tortious acts,” “fail[ure] to act in good faith,” and “misconduct.” (Dkt.

# 1 at 24.) Plaintiff, however, does not assert a coherent legal theory that justifies awarding

attorneys’ fees on these bases alone. Accordingly, the Court grants the motion to the extent

Plaintiff seeks attorneys’ fees from Henkels. 

CONCLUSION

Plaintiff may not maintain any cause of action for which damages are based solely on

a deficiency in the Mata loan. To the extent Plaintiff’s claims otherwise survive, however,

Plaintiff may maintain an action for other damages. As for Plaintiff’s underlying claims, the

Court denies the motion regarding the Negligence, Negligent Misrepresentation, and Unjust

Enrichment claims. The Court grants the motion regarding the Fiduciary Duty claim. The

Court grants the motion regarding Attorneys’ Fees with regard to Henkels only. To the

extent Plaintiff can cure any defects in its Complaint, the Court grants Plaintiff leave to

amend because amendment “shall be freely given when justice so requires.” Fed. R. Civ. P.

15(a).

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IT IS THEREFORE ORDERED that Defendants’ Motion to Dismiss is DENIED

IN PART and GRANTED IN PART with leave to amend.

DATED this 3rd day of December, 2009.

Case 2:09-cv-00748-GMS Document 26 Filed 12/03/09 Page 13 of 13