Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_15-cv-00896/USCOURTS-cand-5_15-cv-00896-2/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 15:1681 Fair Credit Reporting Act

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

MARIA CASTELLANOS,

Plaintiff,

v.

COUNTRYWIDE BANK NA, et al.,

Defendants.

Case No. 15-cv-00896-BLF 

ORDER DENYING PLAINTIFF'S 

MOTION FOR A PRELIMINARY 

INJUNCTION

[Re: ECF 2]

This suit arises out of a dispute over a mortgage transaction between Plaintiff and 

Defendant Countrywide Bank, N.A. Plaintiff brings suit alleging violations of the Fair Debt 

Collection Practices Act (“FDCPA”), California’s Rosenthal Act and Civil Code § 2943, and 

claims for wrongful foreclosure and quiet title. Before the Court is Plaintiff’s motion for a 

preliminary injunction, seeking to enjoin Defendants from foreclosing on the real property secured 

by the challenged mortgage transaction. See ECF 2. This is not the first court action Plaintiff has 

filed to attempt to stave off foreclosure on this property: Plaintiff has now three times, on the eve 

of foreclosure, sought redress from a court to prevent Defendants from non-judicially foreclosing 

on the property. Defendants oppose the motion, contending that Plaintiff cannot show a likelihood 

of success on the merits. They also contend that Plaintiff is forum shopping, and that the Court 

should deny her preliminary injunction because this suit is an improper vehicle to seek redress on 

a case that has already been before a state court. For the reasons provided below, the Court agrees 

with Defendants, and DENIES Plaintiff’s motion for a preliminary injunction. 

I. BACKGROUND

A. Factual Background

Plaintiff states that in 2006 she engaged in a transaction with Countrywide Bank, N.A., in 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 1 of 11
2

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

which she refinanced her debt on real property located in Watsonville, California. Compl. ¶ 21. 

She claims that Countrywide was “not the source of funds involved in the consumer transaction,” 

and “denies any loan and or debt being owed to any party.” Compl. ¶ 22. On July 18, 2014, 

Plaintiff sent Defendants Select Portfolio Services (“SPS”) and National Default Servicing Corp. 

(“NDSC”) a notice of dispute pursuant to 15 U.S.C. § 1692g, disputing the alleged debt and 

notifying the Defendants of her belief that their prior communication with her violated the FDCPA 

and other consumer protection statutes. See Compl. Exh. A. at 1-2. SPS responded by serving 

Plaintiff with a dunning notice. Compl. ¶ 25, Exh. B. Plaintiff further alleges that the assignment 

of the deed of trust, filed in the Santa Cruz County Recorder’s Office, was false and fraudulent. 

Compl. ¶ 26.

Plaintiff argues that between July and September 2006, the promissory note that evidenced 

her indebtedness to Countrywide was sold to a Real Estate Mortgage Investment Conduit 

(“REMIC”) called the CWALT 2006-OA17 REMIC Trust (“CWALT Trust”). TRO App. ¶ 4. She 

contends, however, that the deed of trust was not transferred to the CWALT Trust along with the 

note. Id. at ¶ 5. She further argues that Mortgage Electronic Registration Systems, Inc. (“MERS”) 

stated in May 5, 2011 that it was the holder of the deed of trust, id. at ¶ 15, and contends that the 

note and deed were separated, rendering the deed “of no force and effect.” Id. at ¶ 16. She 

continues: “Once the debt instrument and security instrument were separated . . . the deed of trust 

including the power of sale incorporated therein became unenforceable.” Id. at ¶ 18. She also

contends that any assignment by MERS of the deed of trust and promissory note was invalid, and 

that any transfer of the rights from MERS to another entity, Bank of New York Mellon, 

constituted “the transfer of a debt in default.” TRO App. ¶¶ 19-22.1

Plaintiff’s Complaint alleges that the CWALT Trust is subject to the terms of a Pooling 

 

1

The TRO application and Complaint both include a recitation of various transfers between 

entities that Plaintiff contends occurred. Specifically, she states that MERS assigned its rights to 

Bank of New York Mellon, as Trustee of the CWALT Trust, and that Mellon thereafter transferred 

the “servicing rights” to SPS. TRO App. ¶ 19. Confusingly, Plaintiff then goes on to state that 

SPS “allegedly acquired servicing rights from Bank of America effective December 1, 2011.” 

TRO App. ¶ 23 (emphasis added). Neither the Complaint nor TRO Application is clear in alleging 

the chain of wrongful transfers that Plaintiff contends gives rise to her FDCPA or Rosenthal Act 

claims. 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 2 of 11
3

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

and Servicing Agreement (“PSA”), Compl. ¶ 27, and that Bank of New York Mellon, the trustee 

of the CWALT Trust, “does not have the power or authority under the terms of the PSA to declare 

any note which is the property of the trust to be in default, to modify said note, or to commence a 

foreclosure of any promissory note or deed of trust held by the trust.” Compl. ¶ 28. 

Finally, she argues that Defendants are debt collectors, as defined by the FDCPA and 

Rosenthal Act, and that under both statutes a debt collector cannot non-judicially foreclose on a 

property in order to satisfy a debt, thus rendering any attempt by SPS or NDSC to foreclose on her 

property a violation of both statutes. TRO App. at ¶¶ 24-25. 

B. Procedural History 

This is not the first legal action Plaintiff has brought with regard to this particular debt, 

though Plaintiff made no mention of her prior legal actions in her Complaint or TRO Application 

filed with this Court. 

After two Notices of Default and a Notice of Trustee’s Sale were recorded against the 

Property, see ECF 15-1 Exhs. 4-5, 7, Plaintiff filed a Chapter 7 bankruptcy petition on August 6, 

2014, see id. Exh. 8 the date for which the Trustee’s Sale was noticed. Id. Exh. 7 at 1. That action 

was dismissed on August 21, 2014 for failure to file required documents. Id. Exh. 9.2

On August 4, 2014, Plaintiff filed a state court action against Defendants in Santa Cruz 

Superior Court. Defendants demurred, and Plaintiff filed an amended complaint on November 17, 

2014. That same day, Plaintiff filed an ex parte application for a temporary restraining order to 

stay the foreclosure sale of the property. ECF 16 Exh. 12. The TRO was granted, but following 

briefing as to why a preliminary injunction should not issue, the state court dissolved the TRO and 

denied Plaintiff’s motion for a preliminary injunction on December 29, 2014. ECF 16 Exh. 13. 

Plaintiff dismissed the state court action on February 23, 2015.

3

 

2 Defendants requested the Court take judicial notice of these (and other) documents in relation to 

their motion to dismiss the Complaint. See ECF 15. Because these documents are “matters of 

public record,” judicial notice is appropriate. See Lee v. City of Los Angeles, 250 F.3d 668, 689 

(9th Cir. 2001). 

3 At oral argument, Plaintiff’s counsel stated that he felt the suit was improperly filed in state 

court, and should have been filed in federal district court with an FDCPA cause of action. But 

Plaintiff was the party who controlled the forum in which suit was filed, and nothing prevented 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 3 of 11
4

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

This third action followed a mere four days later: Plaintiff filed her Complaint and TRO 

application on February 27, 2015. ECF 1, 2. In her TRO application, Plaintiff stated that on 

February 25, 2015, she had contacted NDSC to inquire about a continuation date for the pending 

foreclosure sale, but was “informed that the sale date of March 2, 2015 would be going forward 

unless restrained by Court Order.” TRO App. ¶ 32. She noted that the foreclosure sale “was on 

hold while the parties were discussing possible solutions,” and that NDSC had “voluntarily 

continued the previous set date” of the foreclosure sale. Id. ¶¶ 30, 31. Plaintiff made no mention of 

the fact that the state court had denied her motion for a preliminary injunction two days prior to 

her contacting NDSC. Without this information, and knowing only that the foreclosure sale was 

scheduled for the following Monday morning, the Court granted Plaintiff’s TRO application, and 

prohibited the sale of the property from going forward as scheduled. See ECF 6 at 4.

The Court scheduled an Order to Show Cause hearing for March 12, 2015 to determine 

whether a preliminary injunction should issue. The parties stipulated to continue the hearing date 

until April 23, 2015, and to maintain the terms of the Court’s TRO until that date. See ECF 10 at 

3. At the hearing, Defendants’ counsel agreed to maintain the TRO until the Court issued a written 

order.

II. LEGAL STANDARD

A preliminary injunction is a matter of equitable discretion and is “an extraordinary 

remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” 

Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7, 22 (2008). A preliminary 

injunction “is not a preliminary adjudication on the merits but rather a device for preserving the 

status quo and preventing the irreparable loss of rights before judgment.” Sierra On–Line, Inc. v. 

Phoenix Software, Inc., 739 F.2d 1415, 1422 (9th Cir. 1984). As such, the basic function of a 

preliminary injunction is “to preserve the relative positions of the parties until a trial on the merits 

can be held.” Univ. of Texas v. Camenisch, 451 U.S. 390, 395 (1981).

 

Plaintiff from instead filing a suit in federal court that included an FDCPA cause of action. 

Plaintiff’s counsel provides no persuasive reason why the Court should ignore Plaintiff’s choice to 

file her action in state court, let alone to amend that complaint following a demurrer, when 

considering whether Plaintiff engaged in forum shopping. 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 4 of 11
5

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

The party seeking preliminary injunctive relief must establish “(1) that he is likely to 

succeed on the merits, (2) that he is likely to suffer irreparable harm in the absence of relief, (3) 

that the balance of equities tips in his favor, and (4) that an injunction is in the public interest.” 

Winter, 555 U.S. at 20. Alternatively, an injunction can issue where “the likelihood of success is 

such that serious questions going to the merits were raised and the balance of hardships tips 

sharply in [the moving party's] favor,” provided that the movant can also demonstrate the other 

Winter factors. Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1131 (9th Cir. 2011) 

(citation and internal quotation marks omitted). Showing “serious questions going to the merits” 

requires more than establishing that “success is more likely than not;” rather, it requires a moving 

party to demonstrate a “substantial case for relief on the merits.” Leiva–Perez v. Holder, 640 F.3d 

962, 967 (9th Cir. 2011).

 III. DISCUSSION

The Court looks to each of the four Winter factors to determine whether Plaintiff has met 

her moving burden. Plaintiff must establish all four elements in order for the Court to issue an 

injunction. See, e.g., Cottrell at 1131. The Court finds for the reasons below that Plaintiff fails to 

establish three of the four elements, any one of which would render a preliminary injunction 

inappropriate.

A. Likelihood of Success on the Merits

In determining whether Plaintiff has made out a substantial case for relief on the merits, the 

Court engages in a claim-by-claim analysis of the causes of action brought in her Complaint.4

1. The FDCPA and Rosenthal Act Claims

Plaintiff’s first and third causes of action contend that Defendants have violated the 

FDCPA and Rosenthal Act in several ways. First, she argues that “Defendants have alleged 

erroneous amounts due and owing . . . [and] threat[ened] action that cannot be legally taken (nonjudicial foreclosure).” Compl. ¶ 35. Second, she argues that Defendants have engaged in harassing 

 

4

Plaintiff also includes in her Complaint a stand-alone cause of action for injunctive relief as her 

sixth cause of action. But injunctive relief is a remedy, not a claim. See McDowell v. Watson, 59 

Cal. App. 4th 1155, 1159 (1997). 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 5 of 11
6

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

behavior in connection with debt collection. Compl. ¶ 38. Third, she contends that Defendants 

engaged in false or misleading representations with regard to collection of her debt. Compl. ¶¶ 39, 

49. Fourth, she contends that SPS has furnished deceptive documentation to her regarding the 

assignment of the deed of trust. Compl. ¶ 41. Defendants argue that they are not debt collectors for 

purposes of the statutes and that the statutes do not apply to foreclosure activities. Defs.’ Opp. at 7. 

They further argue that neither statute provides for injunctive relief on claims such as these. Id. at 

7-8. 

Defendants’ last argument regarding the relief Plaintiff can receive under the FDCPA and 

Rosenthal Act is ultimately its most persuasive. Both statutes permit an individual to recover 

statutory damages of up to $1,000, along with actual damages. See 15 U.S.C. § 1692k(a)(1)-(2). 

Neither statute permits injunctive relief. See, e.g., Palmer v. Stassinos, 233 F.R.D. 546, 548 (N.D. 

Cal. 2006). Even were Plaintiff to prevail under either statute, neither cause of action supports a 

request for injunctive relief. Plaintiff has provided no authority to support her contention that she 

is entitled to a preliminary injunction on these claims where her remedy, were she to succeed, 

would be limited to a monetary award alone. 

2. The Wrongful Foreclosure Claim

Plaintiff’s second cause of action for wrongful foreclosure alleges that the notice of default 

was inadequate under California Civil Code §§ 2924 et seq. and that Defendants are debt 

collectors as defined by the FDCPA, which bars them from taking non-judicial action to foreclose 

on her home. Compl. ¶¶ 43-45. 

Defendants make several arguments in response. First, they argue that, to the extent 

Plaintiff bases her claim on her theory of defective securitization of the subject loan, she does not 

have standing to make those claims because she is not a party to or third-party beneficiary of the 

assignment or CWALT Trust pooling and servicing agreement. See Opp. at 10. Second, they argue 

that a party is not required under California law to produce the promissory note, prove it holds the 

note, or prove chain of ownership in order to non-judicially foreclose. See id. at 11. 

First, Plaintiff’s defective notice of default argument is unpersuasive. A review of the 

notice of default shows that it identifies the nature of the alleged default and provides Plaintiff 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 6 of 11
7

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

with instructions on how to cure this default. ECF 15-1 Exh. 5 at 1-2 (noting the amount past due 

and providing Plaintiff with steps to cure). Further, contrary to Plaintiff’s assertion, the statute 

does not require the notice to identify the lender, but only the current “beneficiary or mortgagee.” 

Cal. Civ. Code §2924c(b)(1). Because Plaintiff’s Complaint does not identify the manner in which 

this notice is allegedly defective, she has not shown a likelihood of success on the merits. 

Second, Defendants are correct that Plaintiff lacks standing to challenge the ability of the 

Trustee to foreclose based on the CWALT Trust’s pooling and servicing agreement. Plaintiff’s 

argument challenging the validity of a foreclosure relies on several steps: (1) that the promissory 

note was invalidly assigned from MERS to Bank of New York Mellon (as Trustee to the CWALT 

Trust), (2) that the deed of trust did not follow the note into the CWALT Trust, (3) that Mellon, as 

Trustee, does not have the authority to declare the note to be in default or commence a foreclosure, 

and therefore that (4) SPS cannot non-judicially foreclose on her home. See Compl. ¶¶ 25-30. A 

2012 case in this district, Almutarreb v. Bank of New York Trust Co., considered a similar 

argument to the one Plaintiff makes here. 2012 WL 4371410, at *1 (N.D. Cal. Sept. 24, 2012) 

(“The gravamen of Plaintiff’s complaint is that Defendants failed to comply with the terms of the 

Pooling Servicing Agreement for the trust into which Plaintiffs’ note was transferred.”). The Court 

roundly rejected the plaintiffs’ claim that “Defendants lack standing or authority to exercise any 

claim to the deed of trust or property at issue . . . by foreclosing on the property.” Id. at *1, *2 

(“Plaintiffs’ argument has been soundly rejected by courts that have addressed similar 

arguments.”) (emphasis added). Because the plaintiffs in Almutarreb were not parties to the 

pooling agreement, they lacked standing to challenge “the validity of the securitization process.” 

Id. at *1. Plaintiff’s argument here suffers the same fate. Though Plaintiff claims in her Reply that 

she “is not suing to enforce the Pooling and Servicing Agreement,” Reply, ECF 20 at 8, her claim 

against Mellon’s ability to foreclose on the property relies on her challenge to its authority under 

the PSA. Plaintiff seems to recognize this, framing her argument thusly: “The simple question is, 

have the parties complied with their contractual duties in order to obtain the rights to act under the 

security documents.” Id. at 9 (emphasis added). Defendants’ challenge to Plaintiff’s standing to 

assert her theory renders her unlikely to succeed on the merits of this claim. 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 7 of 11
8

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

Plaintiff’s argument regarding FDCPA § 1692f is somewhat more plausible, but ultimately 

unavailing. She contends that Defendants are debt collectors within the terms of the statute, and 

that debt collectors are barred from non-judicially foreclosing on a home in order to collect a debt. 

This allegation relies on her claim that the assignment of the note occurred after she was already in 

default. She points to a payoff statement sent by SPS on October 22, 2014, which states that her 

payment due date was April 1, 2009, as evidence that she was already in default on the mortgage 

at the time the assignment occurred in 2011. See Compl. Exh. B at 1. 

This Circuit has adopted a “case-by-case approach to determining when a debt is in 

default.” Natividad v. Wells Fargo Bank, N.A., 2013 WL 22996021, at 4 (N.D. Cal. May 24, 2013) 

(citing De Dios v. Int’l Realty & Inves., 641 F.3d 1071, 1074 (9th Cir. 2011)). At oral argument, 

counsel for Defendants contended that the date the assignment was recorded is not necessarily the 

date the assignment was made, and that Plaintiff has not sufficiently alleged that the debt was 

assigned to Defendant after it was in default. While Plaintiff may have a colorable claim that the 

transfer occurred after default, see Natividad at *3 (“[M]ere overdue payments may constitute a 

debt that is in default.”), her claim is unlikely to succeed on the merits because “courts within this 

Circuit have concluded that a non-judicial foreclosure does not constitute ‘debt collection’ as 

defined by the [FDCPA].” Garcia v. Am. Home Mortg. Serv., Inc., 2011 WL 6141047, at *4 (N.D. 

Cal. Dec. 9, 2011) (compiling cases) (emphasis added); see also Tang v. Calif. Reconveyance Co., 

2010 WL 5387837, at *4 (N.D. Cal. Dec. 22, 2010) (“[T]o the extent [plaintiffs’] FDCPA claims 

are based on the initiation of a foreclosure proceeding, Plaintiffs fail to state a claim.”).

5

3. The Payoff Demand Claim

Plaintiff’s fourth cause of action contends that Defendants failed to provide her with a 

payoff demand statement as required by California Civil Code § 2943. She alleges that she served 

Defendants with a Request for Beneficiary Statement and that Defendants did not provide her with 

a payoff statement within 21 days. Section 2943 does not require a payoff statement be provided, 

 

5

Plaintiff argues in reply that because she has shown “serious questions” on this issue and that,

because the balance of the equities tip in her favor, the Court should grant her motion. Cf. Cottrell

at 1131. But because the Court finds below that the balance of hardships tips in favor of 

Defendants, Plaintiff cannot meet Cottrell’s lower “serious question” standard. 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 8 of 11
9

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

however, “if the loan is subject to a recorded notice of default . . . unless the written demand is 

received prior to the first publication of a notice of sale.” Cal. Civ. Code § 2943(c). In this case, a 

notice of sale was recorded on July 15, 2014. See ECF 15-1 Exh. 7. Nowhere in Plaintiff’s 

Complaint or TRO application does she state that she sent a Request for Beneficiary Statement 

prior to July 15, 2014. See Compl. ¶¶ 51-55. In fact, her Complaint states that her Request is 

attached to her Complaint as “Exhibit F,” but no such exhibit is attached to the Complaint. 

Plaintiff therefore has not shown a likelihood of success as to the fourth cause of action. 

4. The Quiet Title Claim

Plaintiff’s fifth cause of action seeks to quiet title. In California, a Plaintiff cannot quiet 

title “without discharging his debt. The cloud upon his title persists until the debt is paid.” Aguilar 

v. Bocci, 39 Cal. App. 3d 475, 477 (1974). Plaintiff’s Complaint and TRO application include no 

offer to tender any amount owed on the subject loan. Plaintiff cannot ignore this obligation 

because she herself pleads that she entered into a transaction with Countrywide. See Compl. ¶ 21. 

A mere cursory pleading that Countrywide “was not the source of the funds involved in the 

consumer transaction,” and her denial of “any loan and or debt being owed to any party” is not 

sufficient to exempt Plaintiff from the tender requirement. See Compl. ¶ 22; see also Lona v. 

Citibank, N.A., 202 Cal. App. 4th 89, 112-16 (2011) (finding that a plaintiff’s challenge to the 

underlying loans as violative of public policy fell within an exception to the tender requirement). 

Plaintiff has therefore shown no likelihood of success on the merits as to the fifth cause of action. 

Plaintiff has failed to show a likelihood of success on the merits as to any of her causes of 

action. As such, she has not met the first required element for a preliminary injunction. This alone 

is sufficient to deny her request for a preliminary injunction. See Winter at 20. 

B. Likelihood of irreparable injury

Plaintiff’s TRO application states that if the foreclosure sale proceeds “she will lose her 

home.” See ECF 2-3 at ¶ 26. Courts in this district have held that the loss of one’s home is 

“generally considered sufficient to satisfy this element.” Vazquez v. Select Portfolio Serv., 2013 

WL 5401888, at *2 (N.D. Cal. Sept. 26, 2013). Though Defendants argue that “the loss of a 

property is the outcome of every foreclosure sale,” Defs.’ Opp. at 13, this does not render the 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 9 of 11
10

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

injury any less severe. Plaintiff has therefore satisfied this element. 

C. Balance of hardships

Plaintiff argues that “any harm to defendant (sic) should not be considered.” TRO App. ¶ 

27. This is simply not true: the Court must consider and balance the harms facing both Plaintiff 

and Defendants when considering this third Winter element. See, e.g., Tamburri v. Suntrust 

Mortg., Inc., 2011 WL 2654093, at *2 (N.D. Cal. July 6, 2011). 

Plaintiff will undoubtedly suffer harm if a foreclosure sale goes forward and she loses her 

home. See Vazquez at *2. Courts have noted that defendants seeking to foreclose on a home 

generally face far lesser hardship than the plaintiffs on whom they are foreclosing, because 

“defendants will only experience a temporary delay in earning income from their investment.” See

Tamburri at *3. Two factors here, however, tip the scales away from Plaintiff and toward 

Defendants in this balance of hardships inquiry. The first is the length of time for which 

Defendants allege Plaintiff has failed to pay her mortgage, now over six years, which has caused 

Defendants financial harm. The second, and more important, factor is the extent to which Plaintiff 

has engaged in forum shopping this dispute. Plaintiff sought Chapter 7 bankruptcy on August 6, 

2014, the day a foreclosure sale was scheduled, and then failed to file necessary paperwork several 

days later, resulting in its dismissal. Plaintiff then sought relief in state court, obtained a TRO on 

markedly similar facts and legal theories, and, following briefing and a hearing, was denied a 

preliminary injunction on December 29, 2014. She then dismissed the state court action on 

February 23, 2015. Two days after that dismissal, Defendants informed Plaintiff that they would 

proceed with a foreclosure sale. Within two days of that notification Plaintiff filed for a TRO in 

this Court, but failed to apprise the Court of any of these prior court actions. 

In Johnston v. Citimortgage, Inc., a court in this district was faced with a similar situation: 

debtors sought to block a non-judicial foreclosure first through bankruptcy, then through a state 

court action. Neither was successful. Then, a mere four days before the scheduled foreclosure sale, 

they filed a TRO application in federal court. The court found that they engaged in forum 

shopping, and stated that “[u]nder these circumstances . . . any emergency caused by the pendency 

of the foreclosure sale is of the Johnstons' own making.” 2011 WL 941282, at *3 (N.D. Cal. Mar. 

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 10 of 11
11

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

18, 2011). The court in Johnston denied the TRO request, finding that the balance of the equities 

did not tip in favor of Plaintiff. This Court finds the same to be true in this case. 

The Court here finds that the six-year delay in payment on the loan, coupled with the 

forum shopping in which Plaintiff has engaged, tips the balance of hardships to Defendants. 

Plaintiff has therefore failed to make a sufficient showing for this element. 

D. Public interest

Courts in this district have found that “[i]t is in the public interest to allow homeowners an 

opportunity to pursue what appear to be valid claims before being displaced from their homes.” 

Sencion v. Saxon Mortg. Servs., LLC, 2011 WL 1364007, at *1 (N.D. Cal. Apr. 11, 2011). In this 

case, although Plaintiff will be able to pursue the claims in her Complaint, she will not be afforded 

the protection of a preliminary injunction because she has failed to show a likelihood of success 

on the merits, and has improperly engaged in forum shopping. 

IV. ORDER

For the foregoing reasons, Plaintiff’s motion for a preliminary injunction is DENIED, and 

the Temporary Restraining Order is HEREBY DISSOLVED. 

IT IS SO ORDERED.

Dated: April 27, 2015

______________________________________

BETH LABSON FREEMAN

United States District Judge

Case 5:15-cv-00896-BLF Document 23 Filed 04/27/15 Page 11 of 11