Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_11-cv-02066/USCOURTS-azd-2_11-cv-02066-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1441 Petition for Removal- Declaratory Judgement

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Georgianna J. Thomas, 

Plaintiff, 

vs.

Wells Fargo Home Mortgage, Inc., a

Division of Wells Fargo Bank, NA; Wells

Fargo Bank, NA; Mortgage Electronic

Registration Systems, Inc. (aka MERS);

Does 1-1000 as Unknown and

Unidentified Certificate Holders of

Mortgage Asset Securities related to

MERS #1000826-0000106578-4; Tiffany

& Bosco, P.A. as Successor Trustee, 

Defendants. 

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No. CV 11-02066-PHX-NVW

ORDER

Before the Court is Defendant Tiffany & Bosco’s Motion to Dismiss (Doc. 5) and

Defendants Wells Fargo Bank, N.A. and Mortgage Electronic Registration Systems, Inc.’s

Motion to Dismiss Plaintiff’s Complaint (Doc. 7). For the reasons stated below, Defendants’

motions to dismiss will be granted.

I. Background

On May 25, 2007, Plaintiff, along with non-party Spiro Paraskevoulakos, borrowed

$275,800.00 to purchase property located at 3935 E. Rough Rider Road, Unit 1198, Phoenix,

Arizona, 85050. Plaintiff executed a promissory note in exchange for the loan, and signed

a deed of trust secured by the property. The original lender was TBI Mortgage Company,

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and MERS was listed as the beneficiary under the deed of trust. On March 9, 2011, MERS

assigned its interest in the deed of trust to Wells Fargo, which appointed Michael A. Bosco,

Jr. as successor trustee under the deed of trust on June 30, 2011. Foreclosure proceedings

were commenced with respect to Plaintiffs’ property shortly thereafter. Bosco, as trustee,

recorded a Notice of Trustee’s Sale of the property scheduling the trustee’s sale for

September 29, 2011, at which time the property was sold to non-party Wiser Investments,

LLC.

Plaintiff filed her complaint in Maricopa County Superior Court on September 21,

2011. Plaintiff’s complaint lists three causes of action: declaratory relief, injunctive relief,

and false recordations (Doc. 1-1). The case was removed to the district court on October 21,

2011.

II. Legal Standard

A. Rule 12(b)(6), Federal Rules of Civil Procedure

On a motion to dismiss under Fed. R. Civ. P. 12(b)(6), all allegations of material fact

are assumed to be true and construed in the light most favorable to the nonmoving party.

Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). 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). To avoid dismissal, a complaint must contain “only enough facts to state a claim

for relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)

 The principle that a court accepts as true all of the allegations in a complaint does not apply

to legal conclusions or conclusory factual allegations. Ashcroft v. Iqbal, 129 S. Ct. 1937,

1949 (2009). “Threadbare recitals of the elements of a cause of action, supported by mere

conclusory statements, do not suffice.” Id. “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.” Id. “The plausibility standard is not akin to

a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has

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acted unlawfully.” Id. To show that the plaintiff is entitled to relief, the complaint must

permit the court to infer more than the mere possibility of misconduct. Id.

III. Analysis

Because Plaintiff has failed to state any plausible claim for which relief may be

granted, the Court will grant Defendants’ motions to dismiss (Docs. 5, 7). The only

substantive count in Plaintiff’s complaint is her cause of action for false recordations. A.R.S.

§ 33-420 prohibits a party from recording “an interest in, or a lien or encumbrance against,

real property” when that party “knows[s] or ha[s] reason to know that the document is forged,

groundless, contains a material misstatement or false claim or is otherwise invalid[.]”

Plaintiff has merely conclusorily alleged that Defendants violated A.R.S. § 33-420, but she

has not specifically identified any document which was in fact falsely recorded. To the

extent Plaintiff relies on the invalidity of the securitization process and any resulting transfers

of the deed of trust to support her claim that Defendants had no interest in Plaintiff’s property

and thus wrongly recorded loan documents in violation of A.R.S. § 33-420, these claims are

unavailing. See Schayes v. Orion Fin. Group, Inc., 2011 WL 3156303, at *6 (D. Ariz. 2011)

(noting assignments of mortgages and notices of trustee’s sales are not “document[s]

asserting” a “claim [of] interest in, or a lien or encumbrance against[ ] real property” and

therefore do not fall within the ambit of A.R.S. § 33-420). Plaintiff has offered no facts to

show Defendants knowingly recorded false documents in violation of A.R.S. § 33-420.

Accordingly, Count Three fails to state a plausible claim for relief.

The first two counts of Plaintiff’s complaint raise independent causes of action for

injunctive and declaratory relief. However, injunctive and declaratory relief are “remedies

for underlying causes of action . . . not separate causes of action[.]” Silvas v. GMAC

Mortgage, LLC, No. CV-09-0265-PHX-GMS, 2009 WL 4573234, at *6 (D. Ariz. Dec. 1,

2009) (citations omitted). Since Plaintiff has not sufficiently pled any underlying cause of

action, she is not entitled to these equitable remedies. To the extent Plaintiff relies on the

“show me the note” theory and related arguments in Counts One and Two, the District of

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Arizona has widely rejected these theories. See, e.g., Diessner v. Mortgage Elec.

Registration Sys., 618 F. Supp. 2d 1184 (D. Ariz. 2009); Mansour v. Cal-Western

Reconveyance Corp., 618 F. Supp. 2d 1178 (D. Ariz. 2009). Similarly, Plaintiff’s

allegations challenging the legitimacy of MERS and the securitization process have also been

rejected as a basis for challenging foreclosure actions. See, e.g., Cervantes v. Countrywide

Home Loans, Inc., 656 F.3d 1034 (9th Cir. 2011). Further, to the extent Plaintiff seeks to

enjoin the trustee’s sale of the property, that claim is moot since the property was sold to a

non-party on September 29, 2011. See A.R.S. § 33-811(C).

Finally, Tiffany & Bosco is independently entitled to dismissal of this action because

they are not a party to any of the underlying proceedings and appear to have been improperly

named as substitute trustee. Rather, Michael A. Bosco, Jr. is the substitute trustee, not

Tiffany & Bosco. Even if Tiffany & Bosco were the substitute trustee here, actions against

the substitute trustee are governed by A.R.S. §33-807(E), which provides that “a trustee

should only be joined in legal actions pertaining to a breach of the trustee’s obligation under

this chapter or under the deed of trust.” Where a trustee is named in an action that does not

allege a breach of the trustee’s duties, “the trustee is entitled to be immediately dismissed and

to recover costs and reasonable attorney fees[.]” A.R.S. §33-807(E). Because Plaintiff has

not alleged any breach of the trustee’s duties, the substitute trustee would be entitled to

dismissal with prejudice and attorney fees. However, as Tiffany & Bosco note, they are not

the substitute trustee; accordingly, their request for attorney fees under A.R.S. §33-807(E)

will be denied.

IV. Leave to Amend

Leave to amend should be freely given “when justice so requires.” Fed. R. Civ. P.

15(a)(2). Plaintiff will be given an opportunity to amend her complaint to make clear her

allegations in short, plain statements. Any amended complaint must conform to the

requirements of the Federal Rules of Civil Procedure. Plaintiff is warned that if she elects

to file an amended complaint and fails to comply with the Court’s instructions explained in

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this order, the action will be dismissed pursuant to Rule 41(b) of the Federal Rules of Civil

Procedure. See McHenry, 84 F.3d at 1177 (affirming dismissal with prejudice of prolix,

argumentative, and redundant amended complaint that did not comply with Rule 8(a));

Nevijel v. North Coast Life Ins. Co., 651 F.2d 671, 673-74 (9th Cir. 1981) (affirming

dismissal of amended complaint that was “equally as verbose, confusing, and conclusory as

the initial complaint”); Corcoran v. Yorty, 347 F.2d 222, 223 (9th Cir. 1965) (affirming

dismissal without leave to amend of second complaint that was “so verbose, confused and

redundant that its true substance, if any, [was] well disguised”). Specifically, the Court notes

that Spiro Paraskevoulakos may be a necessary party under Fed. R. Civ. P. 19.; failure to join

a necessary party will result in dismissal of this action. See Vera v. Wells Fargo Bank, N.A.,

2011 WL 334286, at *4 (D. Ariz. 2011) (noting co-signatory to a deed of trust is an

indispensable party).

IT IS THEREFORE ORDERED that Defendant Tiffany & Bosco’s Motion to Dismiss

(Doc. 5) is granted.

IT IS FURTHER ORDERED that Defendants Wells Fargo Bank, N.A. and Mortgage

Electronic Registration Systems, Inc.’s Motion to Dismiss Plaintiff’s Complaint (Doc. 7) is

granted.

IT IS FURTHER ORDERED that Plaintiff may file a motion to amend the Complaint

and separately lodge a proposed Amended Complaint by February 6, 2012. The Clerk is

directed to terminate this case without further order if Plaintiff does not file a motion to

amend and lodge a proposed Amended Complaint by February 6, 2012.

DATED this 17th day of January, 2012.

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