Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_14-cv-03850/USCOURTS-cand-4_14-cv-03850-9/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 28:1332 Diversity-Petition for Removal

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United States District Court

For the Northern District of California

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 The document is captioned “FIRST AMENDED VERIFIED COMPLAINT” but it

is actually the second time the complaint has been amended. 

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The Court GRANTS Wells Fargo’s request for judicial notice (“RJN”). See Fed. R.

Evid. 201.

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

VERONICA A. GONZALES,

Plaintiff,

 v.

WELLS FARGO BANK, N.A.,

Defendant. /

No. C 14-03850 JSW

ORDER REGARDING

DEFENDANT’S THIRD MOTION

TO DISMISS

Now before the Court is defendant Wells Fargo Bank, N.A.’s (“Wells Fargo”) motion to

dismiss the second amended complaint1 (“SAC”) filed by plaintiff Veronica A. Gonzales

(“Plaintiff”). The Court finds this matter is suitable for disposition without oral argument and,

thus, VACATES the hearing set for June 5, 2015. See N.D. Civ. L.R. 7-1(b). The Court has

considered the parties’ papers, relevant legal authority, and the record in this case, and for the

reasons that follow, grants in part and denies in part Defendant’s motion.2

BACKGROUND

Plaintiff filed a complaint in state court alleging violations of California statutory

provisions regarding Defendant’s attempts to foreclose on Plaintiff’s residence located at 36

Rustic Way, San Rafael, CA 94901. Acting upon previous motions to dismiss, the Court has

twice before dismissed Plaintiff’s claims under California Civil Code sections 2923.6 and

2923.7 for failure to state a claim, but provided leave to amend. The first time, the Court

Case 4:14-cv-03850-JSW Document 59 Filed 05/27/15 Page 1 of 6
United States District Court

For the Northern District of California

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dismissed Plaintiff’s claims under these statutory provisions because Plaintiff failed to allege

that she submitted an application for a loan modification or requested a foreclosure preventative

alternative. The Court also dismissed with leave to amend Plaintiff’s derivative claims under

California Civil Code section 2924.12 and California Business and Professions Code section

17200. The second time, the Court dismissed Plaintiff’s claim under Section 2923.6 because

she failed to allege that she submitted a complete loan modification application before the

notice of trustee’s sale was recorded on May 9, 2013. Plaintiff had only alleged that she filed a

filed a complete loan modification application sometime around May 2013. The Court

dismissed Plaintiff’s claim under Section 2923.7 on the grounds that she failed to adequately

plead that she ever actually applied for a foreclosure prevention alternative specifically – as

opposed to a loan modification – or that she ever requested that her mortgage servicer provide

her with a single point of contact. The Court also dismissed Plaintiff’s derivative claims under

California Civil Code section 2924.12 and California Business and Professions Code section

17200 based on her failure to plead substantive violations of Sections 2923.6 or 2923.7. The

Court provided Plaintiff with leave to amend. 

Defendant now moves to dismiss Plaintiff’s SAC. The Court shall address additional

facts as necessary in the remainder of this Order.

ANALYSIS

A. Legal Standard for Motion to Dismiss.

A motion to dismiss is proper under Federal Rule of Civil Procedure 12(b)(6) where the

complaint fails to state a claim upon which relief can be granted. The Court’s “inquiry is

limited to the allegations in the complaint, which are accepted as true and construed in the light

most favorable to the plaintiff.” Lazy Y Ranch LTD v. Behrens, 546 F.3d 580, 588 (9th Cir.

2008). Even under the liberal pleadings standard of Federal Rule of Civil Procedure 8(a)(2), “a

plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than

labels and conclusions, and a formulaic recitation of the elements of a cause of action will not

do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citing Papasan v. Allain, 478 U.S.

265, 286 (1986)).

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United States District Court

For the Northern District of California

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Pursuant to Twombly, a plaintiff must not merely allege conduct that is conceivable but

must allege “enough facts to state a claim to relief that is plausible on its face.” Id. 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, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556). If the allegations are

insufficient to state a claim, a court should grant leave to amend, unless amendment would be

futile. See, e.g., Reddy v. Litton Indus., Inc., 912 F.2d 291, 296 (9th Cir. 1990); Cook, Perkiss

& Lieche, Inc. v. N. Cal. Collection Serv., Inc., 911 F.2d 242, 246-47 (9th Cir. 1990).

As a general rule, “a district court may not consider material beyond the pleadings in

ruling on a Rule 12(b)(6) motion.” Branch v. Tunnell, 14 F.3d 449, 453 (9th Cir. 1994),

overruled on other grounds, Galbraith v. Cnty. of Santa Clara, 307 F.3d 1119 (9th Cir. 2002)

(citation omitted). However, documents subject to judicial notice may be considered on a

motion to dismiss. In doing so, the Court does not convert a motion to dismiss to one for

summary judgment. See Mack v. S. Bay Beer Distrib., 798 F.2d 1279, 1282 (9th Cir. 1986),

overruled on other grounds by Astoria Fed. Sav. & Loan Ass’n v. Solimino, 501 U.S. 104

(1991).

B. Defendant’s Motion to Dismiss.

As noted above, Plaintiff previously alleged that she submitted a complete loan

modification sometime around May 2013. She failed to allege that she had submitted the

complete application for a loan modification before the notice of trustee’s sale was recorded on

May 9, 2013. In her SAC, Plaintiff alleges that she “submitted a loan modification” to

Defendant on May 2, 2013, but fails to allege she submitted an application for a loan

modification that was complete on this date. (SAC, ¶ 26.) Plaintiff then alleges that she

“submitted a loan modification application on May 2nd, [sic] 2013 prior to the Trustee Sale

Notification on May 9, 2014. Thereafter Plaintiff a [sic] requested a first lien loan modification

or foreclosure prevention alternative on or about May, 2013, and again in July, 2014.” (SAC, ¶

31) (emphasis added.) 

Case 4:14-cv-03850-JSW Document 59 Filed 05/27/15 Page 3 of 6
United States District Court

For the Northern District of California

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The Court notes that the drafting of the various versions of the complaint have been

quite sloppy, at best. Perhaps Plaintiff merely inadvertently omitted the words “complete” and

“application” from paragraph 26, but without these words, Plaintiff’s allegations are insufficient

to state a claim under Section 2923.6. The allegations in paragraph 31 do not assist her. She

still fails to clearly allege that she submitted a complete application for a loan modification

before a notice of trustee’s sale was recorded. Plaintiff had already been told by the Court that

she needed to allege that she had provided a complete application for a loan modification in

order to state a claim under Section 2923.6. She was then given leave to amend to clarify that

she had actually submitted a complete application for a loan modification to Defendant before

the notice of trustee’s sale had been recorded. Because leave to amend should be granted with

extreme liberality and it is not clear that granting such leave would be futile, the Court will,

once again, provide Plaintiff with leave to amend. However, the Court admonishes Plaintiff to

carefully proof read the allegations in her complaint before filing another amended complaint. 

Moreover, to the extent the complaint states that exhibits are attached, Plaintiff shall actually

attach the exhibits.

With respect to Plaintiff’s claim under Section 2923.7, Plaintiff’s claim had been

dismissed based on her failure to adequately plead that she ever actually applied for a

foreclosure prevention alternative specifically – as opposed to a loan modification – or that she

ever requested that her mortgage servicer provide her with a single point of contact. However,

upon further review, the Court notes that allegations stating that an application for a loan

modification had been submitted are sufficient to trigger the requirement under Section 2923.7

to assign a single point of contact (“SPOC”). See Penermon v. Wells Fargo Bank, N.A., 47 F.

Supp. 3d 982, 1000 (N.D. Cal. 2014) (noting that “[a] plain reading of the statute requires Wells

Fargo to assign a SPOC when a borrower requests a foreclosure prevention alternative. It does

not require a borrower to specifically request a SPOC.”); see also McFarland v. JP Morgan

Chase Bank, 2014 WL 4119399, *11-12 (C.D. Cal. Aug. 21, 2014); Mungai v. Wells Fargo

Bank, 2014 WL 250890, *10 (N.D. Cal. June 3, 2014). Moreover, courts have found that a

request for a loan modification constitutes a request for “a foreclosure prevention alternative.” 

Case 4:14-cv-03850-JSW Document 59 Filed 05/27/15 Page 4 of 6
United States District Court

For the Northern District of California

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Penermon, 47 F. Supp. 3d at 1000; also McFarland, 2014 WL 4119399 at *12; Mungai, 2014

WL 250890 at *10. Therefore, the Court denies Defendant’s motion to dismiss as to Plaintiff’s

claim under Section 2923.7. 

Moreover, Defendant moves to dismiss Plaintiff’s derivative claims under California

Civil Code section 2924.12 and California Business and Professions Code section 17200 based

on her failure to plead substantive violations of Sections 2923.6 or 2923.7. Because the Court

is not dismissing Plaintiff’s claim under Section 2923.7, the Court denies Defendant’s motion to

dismiss as to Plaintiff’s derivative claims as well.

CONCLUSION

For the foregoing reasons, the Court GRANTS IN PART and DENIES IN PART

Defendant’s motion to dismiss. The Court GRANTS Defendant’s motion as to Plaintiff’s claim

under California Civil Code section 2923.6, but DENIES Defendant’s motion as to the

remainder of Plaintiff’s claims. The Court is providing Plaintiff with leave to amend. If

Plaintiff elects to amend her claim under Section 2923.6, she shall file a third amended

complaint by no later than June 17, 2015. Defendant shall answer or otherwise respond by no

later than July 8, 2015. 

IT IS SO ORDERED.

Dated: May 27, 2015 

JEFFREY S. WHITE

UNITED STATES DISTRICT JUDGE

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