Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_10-cv-01182/USCOURTS-azd-2_10-cv-01182-2/pdf.json

Nature of Suit Code: 140
Nature of Suit: Negotiable Instruments
Cause of Action: 28:1331 Fed. Question

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Brian Vollmer and Peter M. Kane, 

Plaintiff, 

vs.

Randall C. Present, et al., 

Defendant. 

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No. CV 10-1182-PHX-MHM

AMENDED ORDER AS TO DATE

PLAINTIFFS SHALL FILE AN

AMENDED COMPLAINT

Currently before this Court is Defendants John G. Stumpf, R.K. Arnold, Wells Fargo

Bank, N.A., and Mortgage Electronic Registration System’s (“MERS”) Motion to Dismiss,

(Doc. 6), and Motion to Stay or Continue Their Responses to Plaintiff’s Abusive Filings,

(Doc. 46); Defendants Randall C. Present and Donald Tomnitz’s Rule 12(b)(2) Motion to

Dismiss for Lack of Personal Jurisdiction and Joinder in Defendants Stumpf, Arnold, Wells

Fargo, and MERS’s Rule 12(b)(6) Motion to Dismiss. (Doc. 20); and Plaintiffs’ Brian

Vollmer and Peter M. Kane’s Motion to Remand to State Court, (Doc. 11), Motion to Enter

a New and/or Amended Complaint for this Court’s and All Parties’ Clarification, (Doc. 25),

Motion to Amend Complaint, (Doc. 26), Omnibus Motion, (Doc. 34), Motion to Charge

Defendants and Defendants’ Attorney’s with Fraud and Other Crimes Pursuant to Federal

and State Law as Evidenced by the Forensic Examination, (Doc. 36), Motion to Strike All

of Defendants’ Motions for Defendants’ Attorneys’ Violations of: L.R.Civ.P. Rule 83.3 and

Case 2:10-cv-01182-GMS Document 54 Filed 01/04/11 Page 1 of 15
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This Court may consider the Note and Deed of Trust, Notice of Trustee’s Sale, and

Trustees Deed Upon Sale without converting this motion into one for summary judgment

because the documents are central to the allegations in the complaint. See e.g., Townsend

v.Columbia Operations, 667 F.2d 844, 848-49 (9th Cir. 1982).

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F.R.Civ.P. Rule 11 and This Court’s Violation of L.R.Civ.P. Rule 83.5 and Motion for Relief

Pursuant to Rule 60(b)(3/4) and Appointment of Fiduciary, (Doc. 37), and Motion to Deny

all Joinders. (Doc. 45). Having carefully considered the Parties’ pleading and determined

that oral argument is unnecessary, the Court issues the following Order.

I. BACKGROUND

On or about September 26, 2006, Plaintiffs’ Brian Vollmer and Peter M. Kane

borrowed $219,876.00 from DHI Mortgage Company, Ltd. The Parties evidenced the loan

by a promissory note secured by a Deed of Trust on the property, which is located at 4303

South 10th Avenue, Tolleson, Arizona. (Deed of Trust, Exh. A, pp.2–3).1 The Deed of

Trust identified Defendant Mortgage Electronic Registration Systems, Inc. (“MERS”) as

beneficiary, but solely as nominee for the Lender, it successors and assigns. (Id., p. 2, ¶ E).

It appears that Plaintiffs defaulted on their mortgage, and on February 3, 2010, First

American Title Insurance Company noticed a Trustee’s Sale pursuant to the power of sale

in the Deed of Trust. (Notice of Trustee Sale, Doc. 6, Exh. B.). 

On May 4, 2010, Plaintiffs brought suit in state court, seeking an emergency

temporary restraining order to halt the scheduled sale of their property. (Doc. 1). The state

court did not act on their petition, and on May 5, 2007, Plaintiffs property was sold at public

auction. (Trustees Deed Upon Sale, Doc. 6, Exh. C). Defendants Stumpf, Arnold, Wells

Fargo Bank, and MERS removed this case to federal court on June 3, 2010. (Doc. 1). On

June 10, these Defendants filed the instant Motion to Dismiss. (Doc. 6). Plaintiffs

responded on June 24, 2010, (Doc. 19), and the motion became fully briefed on July 12,

2010 (Doc. 30). On June 17, 2010, Plaintiffs filed their Motion to Remand, (Doc. 11),

which became fully briefed when Defendants responded on June 29, 2010. (Doc. 22).

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Defendants Present and Tomnitz filed their Motion to Dismiss on June 25, 2010, (Doc. 20),

Plaintiffs responded on July 6, 2010, (Doc. 24), and Defendants filed their reply on July 14,

2010. (Doc. 32). On July 17, 2010, Defendants CitiMortgage, Inc. and Sanjiv Das joined in

both the motions to dismiss filed by Defendants Stumpf, Arnold, Wells Fargo Bank, and

MERS and Defendants Present and Tomnitz. (Doc. 33). Likewise, on July 28, 2010,

Defendants Parker Kennedy and First American Title Insurance Company also joined the

pending motions to dismiss. (Doc. 38).

On July 6, 2010, Plaintiffs filed their Motion to Enter a New and/or Amended

Complaint for this Court’s and All Parties’ Clarification, (Doc. 25), and Motion to Amend

Complaint, (Doc. 26). On July 22, 2010, Plaintiffs filed their Omnibus Motion, Doc. 34),

which Defendants responded to on July 27. (Doc. 35). On July 27, 2010, Plaintiff filed their

Motion to Charge Defendants and Defendants’ Attorney’s with Fraud and Other Crimes

Pursuant to Federal and State Law as Evidenced by the Forensic Examination, (Doc. 36),

and their Motion to Strike All of Defendants’ Motions for Defendants’ Attorneys’ Violations

of: L.R.Civ.P. Rule 83.3 and F.R.Civ.P. Rule 11 and This Court’s Violation of L.R.Civ.P.

Rule 83.5 and Motion for Relief Pursuant to Rule 60(b)(3/4) and Appointment of Fiduciary.

(Doc. 37). Plaintiff’s filed their Motion to Deny all Joinders on August 9, 2010. Finally,

on August 12, 2010, Defendants filed their Motion to Stay or Continue Their Responses to

Plaintiff’s Abusive Filings. (Doc. 46).

II. PLAINTIFFS’ MOTION TO REMAND

The Court turns first to Plaintiffs’ Motion to Remand. The removal statute authorizes

a defendant to remove to federal court “any civil action brought in a State court of which the

district courts of the United States have original jurisdiction.” 28 U.S.C. § 1441(a). In other

words, “[o]nly state court actions that originally could have been filed in federal court may

be removed to federal court by the defendant.” Caterpillar, Inc. v. Williams, 482 U.S. 386,

392 (1987). The party invoking the removal statute bears the burden of establishing federal

jurisdiction. See Ethridge v. Harbor House Restaurant, 861 F.2d 1389, 1393 (9th Cir. 1988).

Courts strictly construe the removal statute against removal. Id.

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These arguments are also, of course, made by Defendants CitiMortgage, Inc. and Sanjiv

Das and Defendants Parker Kennedy and First American Title Insurance Company, each of

whom have joined both pending motions to dismiss. Accordingly, any decision with respect

to the pending motions to dismiss , unless otherwise noted by this Court, apply to these

Defendants CitiMortgage, Inc., Das, Kennedy, and First American Title Insurance Company.

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In support of their request, Plaintiffs admit that their Complaint raises the possibility

of federal questions, but argues that remand is proper because the majority of their claims

sound in state law. (Doc. 11, p. 3). Plaintiffs’ argument, however, misses the point, as there

is clearly diversity of citizenship between these Parties and the jurisdictional minimum of

$75,000.00 has also been satisfied: Plaintiffs are both citizens of Arizona, all Defendants are

citizens of states other than Arizona, and Plaintiffs action challenges the validity of a loan

in the amount of $219,876.00. See Garfinkle v. Wells Fargo Bank, 483 F.2d 1074, 1076 (9th

Cir. 1973) (finding jurisdictional minimum was met where “whole purpose of this action is

to foreclose the Bank from selling this property” and the property was worth more than the

jurisdictional minimum). Accordingly, removal is proper pursuant to 28 U.S.C. § 1332

irrespective of the particulars of Plaintiffs’ claims. Therefore, Plaintiffs’ motion to remand

is denied.

III. DEFENDANTS’ MOTION TO DISMISS

Defendants Stumpf, Arnold, Wells Fargo Bank, and MERS ask this Court to dismiss

Plaintiffs’ Complaint for insufficient service of process and pursuant to Fed. R. Civ.

12(b)(6) for failure to state a claim. Additionally, Defendants Stumpf and Arnold argue that

dismissal is also appropriate because this Court lacks personal jurisdiction over them.

Defendants’ service of process argument, however, is moot as three weeks after Defendants’

filed their motion, Plaintiffs demonstrated service of process, and Defendants agree that this

Court need not consider their service of process arguments. (Reply, Doc. 30, p.2).

Additionally, Defendants Present and Tomnitz have also moved to dismiss Plaintiffs’

Complaint for lack of personal jurisdiction, and have joined in Defendants Stumpf, Arnold,

Wells Fargo Bank, and MERS’ arguments pursuant to 12(b)(6).2

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A. Personal Jurisdiction

The Court turns first to Defendants’ Stumpf and Arnold’s and Present and Tomnitz’s

personal jurisdiction arguments, which are essentially identical. In short, Defendants assert

that this Court lacks personal jurisdiction because Plaintiffs’ sole reference to them is in the

caption of Plaintiffs’ Complaint. Plaintiffs bare the burden of demonstrating that jurisdiction

is appropriate. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004)

Where, as here, the motion is based on written materials rather than an

evidentiary hearing, “the plaintiff need only make a prima facie showing of

jurisdictional facts.” Id. In such cases, “we only inquire into whether [the

plaintiff's] pleadings and affidavits make a prima facie showing of personal

jurisdiction.” Caruth v. International Psychoanalytical Ass'n, 59 F.3d 126, 128

(9th Cir.1995). Although the plaintiff cannot “simply rest on the bare

allegations of its complaint,” Amba Marketing Systems, Inc. v. Jobar

International, Inc., 551 F.2d 784, 787 (9th Cir.1977), uncontroverted

allegations in the complaint must be taken as true. AT & T v. Compagnie

Bruxelles Lambert, 94 F.3d 586, 588 (9th Cir.1996). 

Id. Having reviewed the Plaintiffs’ Complaint, the Court finds that Defendants are correct:

the Complaint does not make a single reference to either Stumpf, Arnold, Present, or

Tomnitz. Accordingly, it does not sufficiently allege facts that can form the basis of a prima

facie showing of personal jurisdiction against these Defendants Id. Additionally, Plaintiffs

are incorrect that Defendants waived their right to challenge this Court’s jurisdiction by

removing this action from state court. See Fields v. Sedgwick Associated Risks, Ltd., 796

F.2d 299, 301 (9th Cir. 1986). Therefore, Defendants’ Stumpf and Arnold and Present and

Tomnitz’s Motions to Dismiss for lack of personal jurisdiction are granted.

B. Failure to State a Claim

The Court turns next to Defendants’ argument that Plaintiffs have failed to state a

claim for relief. Plaintiffs’ Complaint, which number 132 pages in length, completely

ignores Rule 8's admonition that a Complaint must contain “a short and plain statement of

the claim showing that the pleader is entitled to relief,” and that “[e]ach allegation must be

simple, concise, and direct.” FED.R.CIV.P. 8(a)(2), 8(d)(1). It is generalized, conclusory,

and, at times, non-sensical, quoting various sources at length on a myriad of issues

tangentially related to this country’s financial system. In their Motion, Defendants have

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identified what they believe are six possible claims intended to have been plead by Plaintiffs:

(1) show me the note; (2) confession of judgment; (3) unconscionable contract of adhesion;

(4) vapor money; (5) fraud; and (6) civil RICO violation. Having reviewed the Complaint,

the Court finds that Defendants appraisal of Plaintiffs’ claims—to the extent the allegations

in Plaintiffs’ Complaint can be so labeled—is correct, and the Court will address each one

in turn.

1. Legal Standard

The Court must liberally construe pleadings submitted by a pro se claimant, affording

the claimant the benefit of any doubt. Karim-Panahi v. L.A. Police Dep’t, 839 F.2d 621, 623

(9th Cir. 1988). However, the Court “may not supply essential elements of the claim that

were not initially pled.” Ivey v. Bd. of Regents, 673 F.2d 266, 268 (9th Cir. 1982). To

survive a Rule 12(b)(6) motion to dismiss for failure to state a claim, the plaintiff must

simply allege facts sufficient “to raise a right to relief above the speculative level.” Bell Atl.

Corp. v. Twombly, 550 U.S. 544, 127 S. Ct. 1955, 1965 (2007). “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,__U.S.__, 129 S. Ct. 1937, 1949, 173 L. Ed. 2d 868 (2009). “The plausibility standard

is not akin to a 'probability requirement,' but it asks for more than a sheer possibility that a

defendant has acted unlawfully.” Id. In evaluating a motion to dismiss, “all well-pleaded

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

nonmoving party.” Wyler Summit Partnership v. Turner Broad. Sys. Inc., 135 F.3d 658, 661

(9th Cir. 1998). However, “the court [is not] required to accept as true allegations that are

merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” Spreewell

v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001). Likewise, “a formulaic

recitation of the elements of a cause of action will not do.” Twombly, 127 S. Ct. at 1965.

Dismissal under Rule 12(b)(6) 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). 

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2. Show Me the Note

Plaintiffs’ Complaint alleges that “absent possession of the GENUINE ORIGINAL

PROMISSORY NOTE singed [sic] by Plaintiff, Defendant cannot lawfully move forward

with the non-judicial process as the non-judicial court authorities do NOT have subject

matter jurisdiction.” (Complaint, p.15). Accordingly, Plaintiffs appear to suggest that

Defendants had no authority to foreclose on their home because Defendants were not holders

in due course of the original promissory note. This theory, which is often referred to as

“show me the note,” has been roundly rejected by the District of Arizona. Diessner v.

Mortgage Elec. Registration Sys., 618 F. Supp. 2d 1184, 1187 (D. Ariz. 2009) (“[D]istrict

courts have routinely held that Plaintiff's 'show me the note' argument lacks merit.”); See,

e.g., Ciardi v. Lending Co., 2010 WL 2079735 (D. Ariz. May 24, 2010); Silvas v. GMAC

Mortg., 2009 WL 4573234 (D. Ariz. Dec. 1, 2009, amended Jan. 5, 2010); Contreras v. U.S.

Bank, 2009 WL 4827016 (D. Ariz. Dec. 15, 2009). Given that it is not a cognizable legal

theory, Plaintiffs’ show me the note claim is dismissed with prejudice. Mansour v.

Cal-Western Reconveyance Corp., 618 F. Supp. 2d 1178, 1181 (D. Ariz. 2006) ( “Dismissal

is appropriate where the complaint lacks . . . a cognizable legal theory . . ..”). 

3. Confession of Judgment

In their Complaint, Plaintiffs allege that Defendants may not “use the confession of

judgement as written in the mortgage for any proceeding,” and that “Arizona law requires

the power of attorney for the confession of judgment to be signed AFTER the indebtedness

became due and payable.” (Complaint, p.22; 28–30). In other words, Plaintiffs suggest that

their Deed of Trust and its power of sale clause constitutes an unlawful cognovit note, which

is an “ ancient legal device by which the debtor consents in advance to the holder's obtaining

a judgment without notice or hearing, and possibly even with the appearance, on the debtor's

behalf, of an attorney designated by the holder.” D. H. Overmyer Co. Inc., of Oh. v. Frick

Co., 405 U.S. 174, 177 (1972). In support of this argument, Plaintiffs cite to A.R.S. § 44-

143, which states that:

Judgment by confession shall not be entered upon a note, bond or other

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instrument in writing for the payment of money under the authority of a power

of attorney to confess judgment thereon, unless such authority is executed and

acknowledged on a day subsequent to the date on which the indebtedness to

be confessed became due and payable.

Plaintiff’s claim, therefore, appears to be an attack on Arizona’s non-judicial foreclosure

regime, under which “a power of sale is conferred upon the trustee of a trust deed under

which the trust property may be sold . . . after a breach or default in performance of the

contract or contracts, for which the trust property is conveyed as security . . ..” A.R.S. §

33-807(A). This Court is not aware of, and Plaintiffs have not cited to, any authority that

suggests A.R.S. § 44-143 overrides or otherwise delegitmizes a trustee’s power of sale

pursuant to A.R.S. § 33-807(A). This is because under Arizona law, “deed of trust sales are

conducted on a contract theory under the power of sale authority of the trustee.” In re Krohn,

52 P.3d 774, 777 (Ariz. 2002). Accordingly, a non-judicial foreclosure proceeding does not

result in a judgment which might subject the proceedings to Arizona’s confession of

judgment statute, and Plaintiffs’ claim predicated on A.R.S. § 44-143 is dismissed with

prejudice. Mansour, 618 F. Supp. 2d at 1181.

4. Unconscionable Contract

Plaintiffs’ Complaint also appears to classify their mortgage agreement as an

unconscionable contract, stating that “[a]nyone who would knowingly agree to a nonjudicial

foreclosure, where the illegally appointed bank trustee has the power to foreclose on your

home at his and/or her whim, is ludicrous and would have to be totally incompetent.”

(Complaint, p.42). Unconscionability has two dimensions: procedural and substantive.

“Substantive unconscionability concerns the actual terms of the contract and examines the

relative fairness of the obligations assumed.” Maxwell v. Fidelity Fin. Servs., Inc., 184 Ariz.

82, 89, 907 P.2d 51, 58 (Ariz.,1995). Indicative of substantive unconscionability are contract

terms so one-sided as to oppress or unfairly surprise an innocent party, an overall imbalance

in the obligations and rights imposed by the bargain, and significant cost-price disparity.”

Id. Procedural unconscionability, on the other hand, concerns the process that led to the

formation of the contract, or what the Arizona Supreme Court has referred to as “bargaining

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naughtiness.” Id. When examining procedural unconscionability courts look to “the real and

voluntary meeting of the minds of the contracting party: age, education, intelligence, business

acumen and experience, relative bargaining power, who drafted the contract, whether the

terms were explained to the weaker party, whether alterations in the printed terms were

possible, whether there were alternative sources of supply for the goods in question.” Id.

(quoting Johnson v. Mobil Oil Corp.,415 F. Supp. 264, 268 (E.D. Mich.1976)).

Besides criticizing the power-of-sale clause contained in their Deed of Trust, Plaintiffs

have not alleged facts directed towards a claim for substantive unconscionability. With

respect to the power-of-sale clause, Plaintiffs’ Complaint does not explain how a provision

allowing for a non-judicial foreclosure is substantively unfair, and this Court sees none. 

Power-of-sale clauses are common and, more importantly, are clearly contemplated by

Arizona law. See A.R.S. § 33-810. Plaintiffs allegations also suggest that the inclusion of

the power-of-sale clause in the Deed of Trust was procedurally unconscionable, but, once

again, do not allege facts which support such a claim. Plaintiffs’ Complaint states that

Plaintiffs did not “knowingly agree to have their home subject to a power of sale clause.”

This allegation, however, is directly undercut by the fact that both Plaintiffs signed the Deed

of Trust and initialed the page which contains the power-of-sale clause. (Doc. 6, Exh. A,

p.13, ¶22). Plaintiffs also state that they did not know what the term “power of sale” meant.

(Complaint, p.45). The mere fact that Plaintiffs, who do not appear to have been financially

sophisticated, entered into a contract with a financially sophisticated bank is not, in and of

itself, enough to find procedural unconscionability. See Phillips v. Fremont Inv. & Loan,

2009 WL 4898259, *2 (D. Ariz. Dec. 11, 2009). In short, to state a claim, Plaintiffs need

to bring forth specific facts “to raise a right to relief above the speculative level,” identifying

specific aspects of the contract negotiation that might render the contract unconscionable.

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S. Ct. 1955, 1965 (2007). This they have not

done, and, as a result, this Court must dismiss any claims predicated the Deed of Trust being

an unconscionable contract. 

 5. Vapor Money

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The claim that makes up a great deal of Plaintiffs’ Complaint concerns what Court’s

have dubbed the “Vapor money theory.” Proponents of the vapor money theory, including

these Plaintiffs, argue that mortgages are not enforceable because banks do not actually loan

money. As the Plaintiffs’ Complaint explains:

The bank does not loan money . . . The Mortgage note acts like money. To

make it look like the bank loaned you the money the bank deposits your

mortgage note (lien on the property) as money from which to issue a check.

No money was loaned to legally fulfill the contract for the bank to own the

mortgage note. By doing this, the bank received the lien on the property

without risking or using once cent.

The check is not money, the check merely transfers money and by

transferring money the check acts LIKE money. The money deposited is the

mortgage note. If the bank never fulfills the contract to loan money, then the

bank does not own the mortgage note. The deposited mortgage note is still

your money and the checking account they set p in your name, which they

credited, from which to issue the check, is still your money. They only

returned your money in the form of a check. Why do you have to fulfill your

end of the agreement if the bank refuses to fulfill their end of the agreement?

If the bank does not loan you their money they have not fulfilled the

agreement, the contract is void.

(Complaint, p. 58, (emphasis in original)). Although not lacking in ingenuity and creativity,

this theory is entirely implausible and meritless, and “smacks of bad faith in that after

foreclosure proceedings, plaintiff suddenly files this suit seeking in effect to have the loan

with which he obtained his residence declared illegal so as to back out of his contractual

promise to pay the loan.” Gentsch v. Ownit Mortg. Solutions Inc., 2009 WL 1390843, *5

(E.D. Cal., May 14 2009) (internal quotations omitted) (citing Nixon v. The Individual

Head of St. Joseph Mortgage Co., 615 F.Supp. 898, 900-01 (N.D. Ind.1985). Not

surprisingly, numerous district courts of the Ninth Circuit have rejected vapor money theory

or other similar claims. See, e.g., Kuder v. Washington Mutual Bank, 2009 WL 2868730,

*3 and n. 5 (E.D. Cal. Sept. 2, 2009) (“[Plaintiff’s claims are premised on the so-called

‘vapor money’ theory which has been consistently rejected by federal courts as frivolous.”);

Rodriguez v. Summit Lending Solutions, Inc. et al., 2009 WL 1936795 at *2 (S.D. Cal. July

7, 2009) (“One of Plaintiffs’ central claims is that the underlying loan is unenforceable

because the bank did not issue ‘legal tender’ to the borrower. As discussed by [Defendant]

in its motion to dismiss, this ‘vapor money’ theory has been uniformly rejected as frivolous

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by the courts.”); Sequeira v. Wells Fargo Home Mortgage, 2009 U.S. Dist. LEXIS 31580,

*3 (N.D. Cal. Apr. 1, 2009) (noting that courts “consistently have rejected such a theory of

liability”). In short, Plaintiffs’ vapor-money claim is not plausible, and therefore is dismissed

with prejudice. Mansour, 618 F. Supp. 2d at 1181.

6. Fraud

As part of their discussion of vapor money theory, Plaintiffs allege that “by the banks

not fulfilling the contract by loaning legal tender, they make the alleged borrower, a

depositor. This is fraudulent conversion of the mortgage note. A fraud is a felony.”

(Complaint, 74). Assuming this statement is intended as an allegation of fraud, it has not

been plead with sufficient specificity. Under Arizona law, a showing of fraud requires “(1)

a representation; (2) its falsity; (3) its materiality; (4) the speaker's knowledge of its falsity

or ignorance of its truth; (5) the speaker's intent that it be acted upon by the recipient in the

manner reasonably contemplated; (6) the hearer's ignorance of its falsity; (7) the hearer's

reliance on its truth; (8) the right to rely on it; (9) his consequent and proximate injury.”

Nielson v. Flashberg, 101 Ariz. 335, 419 P.2d 514 (1966). Rule 9(b) of the Federal Rules

of Civil Procedure mandates that “[i]n alleging fraud or mistake, a party must state with

particularity the circumstances constituting fraud or mistake.” This means that the pleadings

must be “be specific enough to give defendants notice of the particular misconduct ... so that

they can defend against the charge and not just deny that they have done anything wrong.”

Kearns v. Ford Motor Co., 567 F.3d 1120, 1124 (9th Cir. 2009) (quoting Bly-Magee v.

California, 236 F.3d 1014, 1019 (9th Cir.2001) (internal quotations omitted)). “[W]hile a

federal court will examine state law to determine whether the elements of fraud have been

pled sufficiently to state a cause of action, the Rule 9(b) requirement that the circumstances

of the fraud must be stated with particularity is a federally imposed rule.” Vess v. Ciba-Geigy

Corp. USA, 317 F.3d 1097, 1103 (9th Cir. 2003) (internal quotations omitted). 

Plaintiffs generalized allegations against “Banks” do not come close to making the

type of who, what, where, when, and how factual allegations that are required by Rule 9(b).

 Vess, 317 F.3d at 1102 (9th Cir. 2003) (“Averments of fraud must be accompanied by ‘the

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who, what, when, where, and how’ of the misconduct charged.”). Plaintiffs’ Complaint

merely lobs generalized accusations of fraud against all the Defendants as group, without

specifically setting forth facts that explain how any Defendant has committed fraud.

Accordingly, Plaintiffs’ Complaint is not sufficiently specific to “provide [D]efendants with

adequate notice to allow them to defend the charge.” In re Stac Elecs. Sec. Litig., 89 F.3d

1399, 1405 (9th Cir.1996) (setting forth three purposes that Rule 9(b) serves). This is true

both of the specific allegation of fraud mentioned above—the one relating to the vapor

money theory—as well as any other allegation of fraud Plaintiffs intended to have plead. 

Therefore, any claim based on fraud is dismissed.

7. RICO

Finally, Plaintiffs’ Complaint states that they “may have additional claims for relief

under ‘Civil RICO’ Federal Racketeering laws (18 U.S.C. § 1964).” (Complaint, p.94).

Specifically, Plaintiff states that “[t]he Lender may have established a ‘pattern of

racketeering activity’ by using the U.S. Mail more than twice to collect an unlawful debt and

the lender may be in violation of 18. U.S.C. §§§§ 1341, 1343, 1961, and 1962.” (Id.).

Racketeering claims, like fraud claims, are subject to Rule 9(b)’s heightened pleading

standard. See, e.g., Wagh v. Metris Direct, Inc., 363 F.3d 821, 825 (9th Cir.2003) (holding

that heightened pleading standards of Fed.R.Civ.P. 9(b) apply to fraud elements of RICO

claim). Plaintiffs’ Complaint, which mentions only the possibility of a RICO claim and is

directed towards banks generally, not these Defendants, clearly does not satisfy the dictates

of Rule 9(b). Any claim predicated on RICO, therefore, is dismissed.

8. Conclusion

Having carefully considered Plaintiffs’ Complaint, this Court has determined that it

fails to state any claims for relief. Accordingly, Defendants’ Motion to Dismiss pursuant

to Rule 12(b)(6) is granted. 

IV. PLAINTIFFS’ MOTIONS TO AMEND

Plaintiffs’ have asked this Court for leave to file an Amended Complaint. The Court

will grant this request, but only as to those claims for which Amendment would not prove

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futile. As indicated in the preceding section, the Court has dismissed with prejudice

Plaintiffs’ “show me the note”, vapor money, and confession of judgment claims, as these

claims are not predicated on cognizable legal theories. Accordingly, Plaintiffs may not reallege these claims in any future complaint. On the other hand, Plaintiffs’ claims that are

predicated on cognizable legal theories, but have been dismissed because of insufficient

factual allegations, may be amended. These claims are: confession of judgment,

unconscionable contract of adhesion, fraud, and civil RICO violation. Should Plaintiffs

choose to file an Amended Complaint, the Court reminds Plaintiffs that Rule 8(a) of the

Federal Rules of Civil Procedure requires that:

A pleading which sets forth a claim for relief, whether an original claim,

counter-claim, cross-claim, or third-party claim, shall contain (1) a short and

plain statement of the grounds upon which the court's jurisdiction depends,

unless the court already has jurisdiction and the claim needs no new grounds

of jurisdiction to support it, (2) a short and plain statement of the claim

showing that the pleader is entitled to relief, and (3) a demand for judgment for

the relief the pleader seeks. Relief in the alternative or of several different

types may be demanded.

FED.R.CIV.P. 8(a). Additionally the Court notes the instant Complaint is difficult to follow,

as it fails to set each claim out individually, fails to specify which facts underlie which

claims, and is completely general (i.e. not specific to these Defendants). Any amended

complaint should focus on facts from which this Court can determine the harm Defendants

caused to Plaintiffs and why Plaintiffs are entitled to seek relief for these alleged harms in

this Court. Plaintiffs must also be sure to allege sufficient facts to meet the jurisdictional

requirements of this Court. The Court will only give Plaintiffs this one opportunity to amend

their Complaint before it dismisses the lawsuit in its entirety. To avoid dismissal, at a

minimum, Plaintiffs must:

make clear . . .allegations in short, plain statements with each claim for

relief identified in separate sections. In the amended complaint, [Plaintiffs]

must write out the rights [they] believe[] were violated, the name of the

person who violated the right, exactly what that individual did or failed to do,

how the action or inaction of that person is connected to the violation of

[Plaintiffs’] rights, and what specific injury [Plaintiffs] suffered because of

the other person's conduct. See Rizzo v. Goode, 423 U.S. 362, 371-72, 377

(1976). Each claim of an alleged violation must be set forth in a separate

count. Any amended complaint filed by [Plaintiffs] must conform to the

requirements of Rules 8(a) and (e)(1) of the Federal Rules of Civil Procedure.

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Kennedy v. Andrews, 2005 WL 3358205, *3 (D. Ariz. 2005) (emphasis added). 

V. PLAINTIFFS’ and DEFENDANTS’ REMAINING MOTIONS

Having determined that Plaintiffs’ Complaint must be dismissed the Court denies as

either as moot or inappropriate Plaintiffs’ remaining motions. In some of these motions,

Plaintiffs have accused Defendants and their counsel of wrongdoing and violations of the

rules of civil procedure. This Court, however, finds no grounds to support any of the

allegations therein. Additionally, because this Court has dismissed the Complaint,

Defendants’ Motion to Stay or Continue Their Responses to Plaintiff’s Abusive Filings is

also moot. 

Accordingly,

IT IS HEREBY ORDERED granting Defendants John G. Stumpf, R.K. Arnold,

Wells Fargo Bank, N.A., and Mortgage Electronic Registration System’s Motion to Dismiss,

(Doc. 6).

IT IS FURTHER ORDERED granting Defendants Randall C. Present and Donald

Tomnitz's Rule 12(b)(2) Motion to Dismiss for Lack of Personal Jurisdiction and Joinder in

Defendants Stumpf, Arnold, Wells Fargo, and MERS's Rule 12(b)(6) Motion to Dismiss.

(Doc. 20).

IT IS FURTHER ORDERED denying as moot John G. Stumpf, R.K. Arnold, Wells

Fargo Bank, N.A., and Mortgage Electronic Registration System’s Defendants Motion to

Stay or Continue Their Responses to Plaintiff’s Abusive Filings. (Doc. 46).

IT IS FURTHER ORDERED denying Plaintiffs’ Brian Vollmer and Peter M.

Kane’s Motion to Remand to State Court. (Doc. 11). 

IT IS FURTHER ORDERED granting Plaintiffs’ Brian Vollmer and Peter M.

Kane’s Motion to Enter a New and/or Amended Complaint for this Court’s and All Parties’

Clarification, (Doc. 25).

IT IS FURTHER ORDERED granting Plaintiffs’ Brian Vollmer and Peter M.

Kane’s Motion to Amend Complaint, (Doc. 26).

IT IS FURTHER ORDERED that should Plaintiffs choose to file an amended

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complaint, they must do so no later than January 20, 2011. Should Plaintiffs fail to file an

amended complaint by close of business on January 20, 2011, IT IS FURTHER

ORDERED directing the Clerk of the Court to close this case and enter judgment

accordingly without further notice to Plaintiffs.

IT IS FURTHER ORDERED denying as moot Plaintiffs’ Brian Vollmer and Peter

M. Kane’s Omnibus Motion, (Doc. 34).

IT IS FURTHER ORDERED denying Plaintiffs’ Brian Vollmer and Peter M.

Kane’s Motion to Charge Defendants and Defendants’ Attorney’s with Fraud and Other

Crimes Pursuant to Federal and State Law as Evidenced by the Forensic Examination, (Doc.

36).

IT IS FURTHER ORDERED denying Plaintiffs’ Brian Vollmer and Peter M.

Kane’s Motion to Strike All of Defendants’ Motions for Defendants’ Attorneys’ Violations

of: L.R.Civ.P. Rule 83.3 and F.R.Civ.P. Rule 11 and This Court’s Violation of L.R.Civ.P.

Rule 83.5 and Motion for Relief Pursuant to Rule 60(b)(3/4) and Appointment of Fiduciary,

(Doc. 37).

IT IS FURTHER ORDERED denying as moot Plaintiffs’ Brian Vollmer and Peter

M. Kane’s Motion to Deny all Joinders. (Doc. 45).

DATED this 4th day of January, 2011.

. 

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