Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_09-cv-01186/USCOURTS-caed-2_09-cv-01186-3/pdf.json

Nature of Suit Code: 140
Nature of Suit: Negotiable Instruments
Cause of Action: 15:1601 Truth in Lending

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

DONALD SANCHEZ, No. 2:09-cv-01186-MCE-GGH

Plaintiff,

v. MEMORANDUM AND ORDER

INDYMAC BANK, FSB; INDYMAC

FEDERAL BANK F.S.B. in its

separate capacity and as

successor to INDYMAC BANK;

WINDSOR CAPITAL MORTGAGE

CORPORATION dba NORTH POINT

LENDING & INVESTMENTS; LINDA

TEMPKO; BARBARA CUILLO; JEFF

B. MCGREGOR; RONNY EARLY;

FIRST PRIORITY FINANCIAL INC.,

dba North Point Lending &

Investments; DAVID MICHAEL

SOLDATI; and DOES 1-20

inclusive, 

Defendants.

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 Because oral argument will not be of material assistance, 1

the Court orders this matter submitted on the briefs. E.D. Cal.

Local Rule 78-230(h). 

 The factual assertions in this section are based on the 2

allegations in Plaintiff’s Complaint unless otherwise specified.

2

Presently before the Court is a Motion by Defendants First

Priority Financial, Inc. (“First Priority”) and David Soldati

(“Soldati”) (collectively “Defendants”) to Dismiss the Second

Amended Complaint of Plaintiff Donald Sanchez (“Plaintiff”) for

failure to state a claim upon which relief may be granted

pursuant to Federal Rule of Civil Procedure 12(b)(6). For the 1

reasons set forth below, Defendants’ Motion is granted.

BACKGROUND2

Though the present lawsuit arises out of a mortgage loan

transaction, the dispute between the parties is largely one of

identification. Defendants argue that they have been mistakenly

named in this lawsuit due to Plaintiff’s misreading of the public

records of California’s Department of Real Estate (“DRE”). The

DRE website indicates that First Priority was at one time “doing

business as” (“dba”) NorthPoint Lending & Investments. However,

Defendants allege that the use of NorthPoint Lending &

Investments as a dba by First Priority ended on October 9, 2006,

a month before Plaintiff allegedly began considering entering his

mortgage loan at the urging of loan officer Ronny Early on

November 15, 2006. 

Consequently, Defendants contend that they should not be

included in this suit.

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3

A. The Mortgage Loan Transaction

On November 15, 2006, Ronny Early represented to Plaintiff

that he was a loan officer for Windsor Capital Mortgage

Corporation (“Windsor Capital”). He told Plaintiff that he could

get him the “best deal” and the “best interest rates” available

on the market and that Plaintiff would pre-qualify for a loan in

the approximate amount of $400,000.00. At the time, Plaintiff

was making $29.00 per hour and he provided to Early documentation

of his income. Plaintiff informed Early that he was surprised he

qualified for a loan of $400,000 when he already had two loan

payments totaling over $1100 per month and his take home pay was

less than $3500 per month. Early told Plaintiff that he only had

to pay the loan for one year and then afterwards Early would

obtain refinancing for a more affordable loan. In reliance on

such representations Plaintiff closed on the loan on January 8,

2007. The terms were memorialized in two promissory notes

secured by two Deeds of Trust on the property.

On January 15, 2009 a Notice of Default on the loan was

filed. On April 15, 2009 Plaintiff was sent a Notice of Trustee

Sale. Plaintiff now alleges several causes of action in connection

to his mortgage loan including: violation of the Truth in Lending

Act (“TILA”), negligence, violation of the Real Estate Settlement

Procedures Act (“RESPA”), breach of fiduciary duty, fraud, and

violation of California’s Unfair Competition Law (“UCL”).

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4

B. Defendant’s Alleged Connection to the Transaction

In discussing his mortgage loan to Early, Plaintiff received

correspondence on letterhead which included both the business

name of Early’s employer “Windsor Capital” and a second name

“NorthPoint Lending & Investments”. This letterhead indicated a

single office location at 201 Sand Creek Road, Suite L,

Brentwood, CA. 

However, NorthPoint Lending & Investments is not listed with

the DRE as a dba for Windsor Capitol. Nor is Windsor Capital

listed as having an office at address 201 Sand Creek Road

Suite L, Brentwood, CA.

Plaintiff alleges that, instead, First Priority is listed by

the DRE as having operated under the name of NorthPoint Lending &

Investments with an office at 201 Sand Creek Road, Brentwood, CA. 

Plaintiff alleges Defendant David Soldati is licensed by the DRE

as the broker for First Priority Financial dba NorthPoint Lending

& Investments.

C. Posture

Plaintiff concedes in his opposition that the motion to

dismiss should be granted as to Soldati. The Court will

therefore focus only on the contested issues surrounding First

Priority’s connection to the loan. 

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5

STANDARD

On a motion to dismiss for failure to state a claim under

Rule 12(b)(6), all allegations of material fact must be accepted

as true and construed in the light most favorable to the

nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336,

337-38 (9th Cir. 1996). Rule 8(a)(2) requires only “a short and

plain statement of the claim showing that the pleader is entitled

to relief” in order to “give the defendant fair notice of what

the...claim is and the grounds upon which it rests.” Bell Atl.

Corp. v. Twombly, 127 S. Ct. 1955, 1964 (2007) (quoting Conley v.

Gibson, 355 U.S. 41, 47 (1957)). While a complaint attacked by a

Rule 12(b)(6) motion to dismiss does not need detailed factual

allegations, a plaintiff’s obligation to provide the “grounds” of

his “entitlement to relief” requires more than labels and

conclusions, and a formulaic recitation of the elements of a

cause of action will not do. Id. at 1964-65 (internal citations

and quotations omitted). Factual allegations must be enough to

raise a right to relief above the speculative level. Id. at 1965

(citing 5 C. Wright & A. Miller, Federal Practice and Procedure

§ 1216, pp. 235-36 (3d ed. 2004) (“The pleading must contain

something more...than...a statement of facts that merely creates

a suspicion [of] a legally cognizable right of action”)). 

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“Rule 8(a)(2)...requires a ‘showing,’ rather than a blanket

assertion of entitlement to relief. Without some factual

allegation in the complaint, it is hard to see how a claimant

could satisfy the requirements of providing not only ‘fair

notice’ of the nature of the claim, but also ‘grounds’ on which

the claim rests.” Twombly, 550 U.S. 556 n.3. A pleading must

contain “only enough facts to state a claim to relief that is

plausible on its face.” Id. at 570. If the “plaintiffs...have

not nudged their claims across the line from conceivable to

plausible, their complaint must be dismissed.” Id. 

Nevertheless, “[a] well-pleaded complaint may proceed even if it

strikes a savvy judge that actual proof of those facts is

improbable, and ‘that a recovery is very remote and unlikely.’”

Id. at 556.

When a claim for fraud is raised, Federal Rule of Civil

Procedure 9(b) provides that “a party must state with

particularity the circumstances constituting fraud.” “A pleading

is sufficient under Rule 9(b) if it identifies the circumstances

constituting fraud so that the defendant can prepare an adequate

answer from the allegations.” Neubronner v. Milken, 6 F.3d 666,

671-672 (9th Cir. 1993) (internal quotations and citations

omitted). “The complaint must specify such facts as the times,

dates, places, benefits received, and other details of the

alleged fraudulent activity.” Id. at 672.

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A court granting a motion to dismiss a complaint must then

decide whether to grant leave to amend. A court should “freely

give” leave to amend when there is no “undue delay, bad faith[,]

dilatory motive on the part of the movant,...undue prejudice to

the opposing party by virtue of...the amendment, [or] futility of

the amendment....” Fed. R. Civ. P. 15(a); Foman v. Davis, 371

U.S. 178, 182 (1962). Generally, leave to amend is denied only

when it is clear the deficiencies of the complaint cannot be

cured by amendment. DeSoto v. Yellow Freight Sys., Inc., 957

F.2d 655, 658 (9th Cir. 1992).

ANALYSIS

The crux of parties’ dispute rests on First Priority’s use

of the fictitious business name “NorthPoint Lending &

Investments.” 

Plaintiff contends he received correspondence from his loan

officer that included the business name NorthPoint Lending &

Investments on the letterhead. Upon searching the DRE website,

Plaintiff found First Priority was listed as using the same

fictitious name and having an office at the same address

indicated on the letterhead. Based on this information,

Plaintiff included First Priority in this suit on the bare

premise that First Priority, as NorthPoint Lending & Investments,

participated in his mortgage loan transaction.

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 Specifically, Exhibit C appears to be the DRE listing for 3

Defendant Windsor Mortgage Corporation.

8

To evidence his belief, Plaintiff’s Complaint refers to an

“Exhibit C” which he identifies as being a printout of the

website’s information page for First Priority. This printout

purportedly would have shown “NorthPoint Lending & Investments”

as being a dba for First Priority. However, Exhibit C does not

reference First Priority, but instead provides information for a

different business entity.3

Defendants respond to this discrepency by providing the

printout of the DRE’s information page for First Priority. 

Defendants’ exhibit indeed reflects that First Priority had at

one time registered the name “NorthPoint Lending & Investments.” 

The DRE page also indicate that use of this name was active from

“04/27/2006 TO 10/09/2006”.

Although Plaintiff never references the registration dates

in his Complaint, Defendants contend that the entirety of the DRE

page should be considered “if the complaint refers to the

document, it is central to Plaintiff’s claims, and no party

questions the authenticity of the copy.” Branch v. Tunnell, 14

F.3d 449, 454 (9th Cir. 1994). The Court agrees with the

Defendants. The DRE document clearly indicates that the

registered dba was active from “04/27/2006 TO 10/09/2006” and

Plaintiff has not refuted this in any way. 

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Even accepting the pleadings as true and construing them in a

light most favorable to the Plaintiff, there is simply nothing in

the Complaint that alleges in any way that First Priority was

doing business as NorthPoint Lending & Investments at the time of

Plaintiff’s alleged transaction on November 15, 2006. In light

of this failure, Plaintiff’s Complaint cannot stand as to First

Priority. 

CONCLUSION

For the reasons set forth above, Defendants’ Motion to

Dismiss Plaintiff’s Complaint as alleged against First Priority

and David Soldati (Docket No. 36) is GRANTED without leave to

amend. 

IT IS SO ORDERED.

Dated: January 15, 2010

_____________________________

MORRISON C. ENGLAND, JR.

UNITED STATES DISTRICT JUDGE

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