Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_09-cv-01982/USCOURTS-caed-1_09-cv-01982-1/pdf.json

Nature of Suit Code: 371
Nature of Suit: Truth in Lending
Cause of Action: 15:1601 Truth in Lending

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IN THE UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

DEBORAH CURTIS, an individual, )

)

Plaintiff, )

)

v. )

)

)

OPTION ONE MORTGAGE CORP., a )

suspended California corporation, and )

DOES 1 though 50 inclusive, )

)

Defendant. )

____________________________________)

1:09-CV-1982 AWI SMS

ORDER GRANTING

DEFENDANT’S MOTIONS TO

DISMISS

(Documents #8, #12, & #14)

BACKGROUND

On July 22, 2009, Plaintiff filed a complaint in the Superior Court of the State of

California, County of Stanislaus. On November 10, 2009, Defendant removed the complaint to

the Eastern District of California, Fresno Division, because this court has federal question

jurisdiction over the complaint pursuant to 28 U.S.C. § 1331. 

The July 22, 2009 complaint (“complaint”) contains four causes of action: (1) A

violation of the Truth in Lending Act (“TILA”) for Defendant’s alleged understatement of

Plaintiff’s Annual Percentage Rate and Plaintiff’s Finance Charges. Plaintiff seeks rescission

and damages. (2) Breach of Fiduciary Duty for Defendant’s failure to make full and accurate

disclosures of the loans and failure to act in Plaintiff’s best interest. (3) A violation of

California Civil Code § 2923.5 for Defendant’s failure to explore Plaintiff’s options to avoid

foreclosure. (4) An Injunction to enjoin Defendant from commencing with a trustee’s sale on

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Plaintiff’s property.

On November 19, 2009, Defendant Sand Canyon Corporation, sued as Option One

Mortgage Corporation, filed a motion to dismiss the complaint. On December 7, 2009,

American Home Mortgage Servicing Inc. filed a motion to dismiss. 

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LEGAL STANDARD

Under Rule 12(b)(6) of the Federal Rules of Civil Procedure a claim may be dismissed

because of the plaintiff’s “failure to state a claim upon which relief can be granted.” Fed. R. Civ.

P. 12(b)(6). A dismissal under Rule 12(b)(6) may be based on the lack of a cognizable legal

theory or on the absence of sufficient facts alleged under a cognizable legal theory. Johnson v.

Riverside Healthcare Sys., 534 F.3d 1116, 1121 (9 Cir. 2008); Navarro v. Block, 250 F.3d 729, th

732 (9 Cir. 2001). In reviewing a complaint under Rule 12(b)(6), all of the complaint’s material th

allegations of fact are taken as true, and the facts are construed in the light most favorable to the

non-moving party. Marceau v. Balckfeet Hous. Auth., 540 F.3d 916, 919 (9 Cir. 2008); Vignolo th

v. Miller, 120 F.3d 1075, 1077 (9 Cir. 1999). The court must also assume that general th

allegations embrace the necessary, specific facts to support the claim. Smith v. Pacific Prop. and

Dev. Corp., 358 F.3d 1097, 1106 (9 Cir. 2004). However, the court is not required “to accept as

th

true allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable

inferences.” In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1056-57 (9 Cir. 2008); Sprewell v. th

Golden State Warriors, 266 F.3d 979, 988 (9 Cir. 2001). Although legal conclusions may th

provide the framework of a complaint, they are not accepted as true and “[t]hreadbare recitals of

elements of a cause of action, supported by mere conclusory statements, do not suffice.” Ashcroft

v. Iqbal, 129 S.Ct. 1937, 1949-50 (2009); see also Warren v. Fox Family Worldwide, Inc., 328

F.3d 1136, 1139 (9th Cir. 2003). As the Supreme Court has explained: 

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

 This motion appears to be unnecessary as American Home Mortgage Servicing, Inc. is 1

not named as a Defendant in the July 22, 2009 complaint.

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‘entitlement to relief’ requires more than labels and conclusions, and a formulaic

recitation of the elements of a cause of action will not do. Factual allegations must

be enough to raise a right to relief above the speculative level, on the assumption

that all the allegations in the complaint are true (even if doubtful in fact).

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). Thus, “a complaint must contain

sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” 

Iqbal, 129 S.Ct. at 1949. “A claim has facial plausibility when the plaintiff pleads factual content

that allows the court draw the reasonable inference that the defendant is liable for the misconduct

alleged.” Iqbal, 129 S.Ct. at 1949. 

The plausibility standard is not akin to a ‘probability requirement,’ but it asks more

than a sheer possibility that a defendant has acted unlawfully. Where a complaint

pleads facts that are ‘merely consistent with’ a defendant’s liability, it stops short

of the line between possibility and plausibility of ‘entitlement to relief.’

. . . 

Determining whether a complaint states a plausible claim for relief will . . . be a

context specific task that requires the reviewing court to draw on its judicial

experience and common sense. But where the well-pleaded facts do not permit the

court to infer more than the mere possibility of misconduct, the complaint has

alleged – but it has not shown – that the pleader is entitled to relief.

Iqbal, 129 S.Ct. at 1949-50. “In sum, for a complaint to survive a motion to dismiss, the nonconclusory ‘factual content,’ and reasonable inferences from that content, must be plausibly

suggestive of a claim entitling the plaintiff to relief.” Moss v. United States Secret Service, 572

F.3d 962, 969 (9 Cir. 2009). th

If a Rule 12(b)(6) motion to dismiss is granted, “[the] district court should grant leave to

amend even if no request to amend the pleading was made, unless it determines that the pleading

could not possibly be cured by the allegation of other facts.” Lopez v. Smith, 203 F.3d 1122,

1127 (9th Cir. 2000) (en banc). In other words, leave to amend need not be granted when

amendment would be futile. Gompper v. VISX, Inc., 298 F.3d 893, 898 (9th Cir. 2002).

JUDICIAL NOTICE

In deciding whether to dismiss a claim under Rule 12(b)(6), the court is generally limited

to reviewing only the complaint, but the court may review materials which are properly submitted

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as part of the complaint and may take judicial notice of public records outside the pleadings. See

Lee v. City of Los Angeles, 250 F.3d 668, 688-89 (9 Cir. 2001); Campanelli v. Bockrath, 100 th

F.3d 1476, 1479 (9 Cir. 1996); MGIC Indem. Corp. v. Weisman, 803 F.2d 500, 504 (9 Cir. th th

1986). Further, under the “incorporation by reference” doctrine, courts may review documents

“whose contents are alleged in a complaint and whose authenticity no party questions, but which

are not physically attached to the plaintiff’s pleading.” Knievel v. ESPN, 393 F.3d 1068, 1076

(9 Cir. 2005); Lapidus v. Hecht, 232 F.3d 679, 682 (9 Cir. 2000). The “incorporation by th th

reference” doctrine also applies “to situations in which the plaintiff's claim depends on the

contents of a document, the defendant attaches the document to its motion to dismiss, and the

parties do not dispute the authenticity of the document, even though the plaintiff does not

explicitly allege the contents of that document in the complaint.” Knievel, 393 F.3d at 1076

(citing Parrino v. FHP, Inc., 146 F.3d 699, 706 (9 Cir. 1998)). th

“In deciding whether to dismiss a claim under Fed.R.Civ.P. 12(b)(6), a court may look

beyond plaintiff's complaint to matters of public record.” Shaw v. Hahn, 56 F.3d 1128, 1129 n. 1

(9 Cir. 1995). Thus, the court will take judicial notice of the deed of trust concerning the th

property at issue in this action and other records concerning the deed of trust and the property’s

title. 

ALLEGED FACTS

This action concerns properties located at 2585 Carriage Court, Turlock, and 1634

Arlington Court, Turlock, both of which are located in the County of Stanislaus, State of

California. 

The complaint alleges that on or about November 2006, Plaintiff approached Defendant in

regards to refinancing the property at 1634 Arlington Court, Turlock. Defendant represented it 2

could provide a fixed rate loan with low monthly payments based upon Plaintiff’s income. 

 The complaint contains in consistent allegations on whether Plaintiff was purchasing 2

the property or refinancing the property.

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Plaintiff agreed to purchase the property at 1634 Arlington Court, Turlock.

The complaint alleges that during the loan process, Defendant deceptively and fraudulently

understated the Annual Percentage Rate (APR) by 2.358%, the finance charge and total payments

by $315,633.03 and the payments schedule listed three payment changes instead of six payment

changes. The complaint alleges that Plaintiff’s income was falsified and the property value

grossly overstated. The complaint alleges that “on or about December 20, 2009 [sic.], unaware of

Defendant’s deceptive and fraudulent actions, Plaintiff executed the refinance.”

The complaint alleges that, less than a month later, Defendant approached Plaintiff about

purchasing a second property, 2585 Carriage Court, Turlock, CA 95382, to be used as Plaintiff’s 3

primary residence. The complaint alleges since Plaintiff was unaware of Defendant’s deception

and fraudulent actions regarding the first refinance, Plaintiff agreed to purchase 2585 Carriage

Court, Turlock, CA 95382.

The complaint alleges that Defendant deceptively and fraudulently understated the Annual

Percentage Rate by .252%, the finance charge and total payments by $147,309.67, and the

payments schedule misstated Plaintiff’s payment amounts. In addition, the complaint Plaintiff’s

income was falsified, and the property value grossly overstated.

The complaint alleges on or about February 1, 2007, unaware of Defendant’s deceptive

and fraudulent actions, Plaintiff executed the refinance.

The complaint alleges that on or about October 2008, in attempting to modify the

refinance loans, Plaintiff discovered that Defendant had under disclosed Plaintiff’s APR and

financed an amount in a blatant violation of the Federal Truth in Lending Act (TILA).

The complaint alleges that Plaintiff brought this discrepancy to Defendant’s attention in an

attempt to modify the loans instead of having to institute her right to rescission. The complaint

alleges Defendant refused to modify the loans with more favorable terms.

 The complaint contains inconsistent allegations regarding whether the property was 3

purchased or refinanced.

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DISCUSSION

I. VIOLATION OF 15 U.S.C. § 1601 – TILA

Plaintiff contends that Defendant violated TILA by understating Plaintiff’s APR and by

understating Plaintiff’s finance charges on the loan. Plaintiff contends that she now exercises her

right to rescission pursuant to 15 U.S.C.§ 1635(b) due to Defendant’ breach. Plaintiff also

contends that she has been damaged by Defendant’s wrongful actions and seeks costs and

reasonable attorney’s fees.

“The purpose of the TILA is to ensure that users of consumer credit are informed as to the

terms on which credit is offered them.” Jones v. E*Trade Mortg. Corp., 397 F.3d 810, 812 (9

th

Cir. 2005); see also 15 U.S.C. § 1601. “TILA was enacted in 1968 ‘to assure a meaningful

disclosure of credit terms so that the consumer will be able to compare more readily the various

credit terms available to him and avoid the uninformed use of credit.” Yamamoto v. Bank of New

York, 329 F.3d 1167, 1170 (9 Cir. 2003). The TILA requires creditors to “clearly and th

conspicuously disclose” borrowers’ rights to rescind a home mortgage loan in accordance with

regulations of the Federal Reserve Board. Jones, 397 F.3d at 812. TILA “requires creditors to

provide borrowers with clear and accurate disclosures of terms dealing with things like finance

charges, annual percentage rates of interest, and the borrower’s rights.” Beach v. Ocwen Fed.

Bank, 523 U.S. 410, 412 (1998). The failure to satisfy TILA’s requirements subjects a lender to

“statutory and actual damages [that are] traceable to a lender’s failure to make the requisite

disclosures.” Id. (citing 15 U.S.C. §1640). 

A. Rescission - Ability to Tender

Plaintiff alleges that she is entitled to rescission of her loan because Defendant failed to

provide accurate material disclosures. Defendant contends this claim must be dismissed because

Plaintiff has failed to allege her ability to tender the amount of the loan. 

The purpose of rescission under TILA is to return both parties to the status quo.

Yamamoto, 329 F.3d at 1172. Title 15 U.S.C. § 1635(b) provides that:

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When an obligor exercises his right to rescind . . . .under subsection (a) of this

section, he is not liable for any finance or other charge, and any security interest

given by the obligor, including any such interest arising by operation of law,

becomes void upon such a rescission. Within 20 days after receipt of a notice of

rescission, the creditor shall return to the obligor any money or property given as

earnest money, downpayment, or otherwise, and shall take any action necessary or

appropriate to reflect the termination of any security interest created under the

transaction. If the creditor has delivered any property to the obligor, the obligor

may retain possession of it. Upon the performance of the creditor's obligations

under this section, the obligor shall tender the property to the creditor, except

that if return of the property in kind would be impracticable or inequitable, the

obligor shall tender its reasonable value. Tender shall be made at the location of

the property or at the residence of the obligor, at the option of the obligor. If the

creditor does not take possession of the property within 20 days after tender by the

obligor, ownership of the property vests in the obligor without obligation on his

part to pay for it. The procedures prescribed by this subsection shall apply except

when otherwise ordered by a court.

15 U.S.C. 15 U.S.C. § 1635(b) (emphasis added).

Defendant contends that before ordering rescission, Plaintiff must allege Plaintiff’s ability

to repay the loan proceeds. See Yamamoto, 329 F.3d 1167 at 1171. The court agrees. Plaintiff

cannot state a claim for rescission under TILA without at least alleging that she is financially

capable of tendering the loan proceeds. See, e.g,, Gonzalez v. First Franklin Loan Services, 2010

WL 144862, *5 (E.D.Cal. 2010) (dismissing without leave to amend plaintiff's claim for

rescission under TILA because Plaintiff conceded she did not have ability to tender); Avina v.

BNC Mortg., 2009 WL 5215751, *2 (N.D.Cal. 2009) (claim for rescission under TILA is subject

to dismissal at the pleading stage if the borrower fails to allege a present ability to tender the loan

proceeds); Farmer v. Countrywide Financial Corp., 2009 WL 1530973, at *5 (C.D. Cal. 2009)

(granting defendant’s motion to dismiss because plaintiffs did not allege that they had tendered or

were financially capable of tendering the loan’s principal balance); Pagtalunan v. Reunion

Mortgage Inc., 2009 WL 961995, at *3 (N.D. Cal. 2009) (dismissing TILA claim because

plaintiffs did not allege that they would be willing to repay what they borrowed); Garza v.

American Home Mortg., 2009 WL 188604, at *5 (E.D. Cal. 2009) (granting defendant’s motion

to dismiss TILA rescission claim in light of complaint’s failure to allege ability to tender, since

“[r]escission is an empty remedy without [plaintiff]’s ability to pay back what she has received.”). 

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Thus, Plaintiff must be able to allege that she has tendered or is financially capable of tendering

the principle of the loan minus the appropriate interest and fees or the rescission claim fails. 

The complaint fails to sufficiently allege that Plaintiff is able to fulfill her obligations

under 15 U.S.C. § 1635(b) and 12 C.F.R. § 226.23(d). The court finds Plaintiff’s allegation

insufficient to have alleged tender in this case. A complete ability to tender has not been adressed

in the complaint. Without such tender, Plaintiff may not seek to rescind the loan. Rescission is an

empty remedy without Plaintiff’s ability to pay back what she has received. As such, the

complaint lacks a necessary element of Plaintiff’s TILA rescission claim. The court dismisses the

TILA rescission claim with leave to amend to allege, subject to Rule 11(b) of the Federal Rules of

Civil Procedure’s requirements, that Plaintiff has the ability to tender and pay back what she has

received.

B. Relief under TILA- Statutory Damages

Plaintiff requests statutory damages for Defendant’s alleged failure to comply with all 

necessary TILA disclosures provisions. Defendant contends that Plaintiff’s request for damages

arising out of the original loan transaction is time-barred by 15 U.S.C. §1640(e) because Plaintiff

did not file this action within one year. 

There is a one-year statute of limitations period in which to file an action for damages

under TILA. See 15 U.S.C. § 1640(e); Beach, 523 U.S. at 412. The one-year limitations period

of 15 U.S.C. § 1640(e) runs from the date of consummation of the transaction. “Consummation”

is defined as “the time that a consumer becomes contractually obligated on a credit transaction.” 

12 C.F.R. § 226.2(a)(13); Grimes v. New Century Mortg. Corp., 340 F.3d 1007, 1009 (9 Cir. th

2003). 

Plaintiff did not file this TILA action within one-year of the loan’s closing. The loans at

issue were executed in late 2006 and early 2007. This action was not filed until July 22, 2009. 

Thus, Plaintiff filed this action beyond the one-year limitations period. Dismissal is appropriate. 

See 15 U.S.C. § 164(e); Beach, 523 U.S. at 412; King, 784 F.2d at 915.

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II. BREACH OF FIDUCIARY DUTY

The second cause of action alleges breach of fiduciary duty. The complaint alleges that

Defendant was engaged in a fiduciary relationship to Plaintiff and breached the fiduciary duties it

owed Plaintiff. The complaint alleges a special relationship was created when Defendant

accepted the trust and confidence Plaintiff placed in Defendant to advise her regarding the loan

and its terms. The complaint alleges Defendant solicited and accepted Plaintiff’s trust and

confidence when it represented it would act in her best interest and was trustworthy and honest. 

The complaint alleges that Defendant breached its duty to Plaintiff by falsifying Plaintiff’s

income, failing to accurately disclose the APR, failing to accurately disclose the finance charges,

failing to accurately disclose the payment amounts, falsifying the subject properties’ appraisal

value, and failing to provide Plaintiff with a good faith estimate.

Plaintiff’s cause of action for breach of fiduciary duty fails because she cannot plausibly

plead the existence of any fiduciary duty between herself and Defendant. A loan transaction is an

arms-length transaction and there is no fiduciary relationship between the borrower and lender. 

Oaks Management Corp. v. Superior Court,145 Cal.App.4th 453, 466 (2006); Union Bank v.

Superior Court, 31 Cal.App.4th 573, 579 n. 2 (1995); Kim v. Sumitomo Bank, 17 Cal.App.4th

974, 979 (1993). In addition, a trustee under a deed of trust owe fiduciary duties to the borrower. 

Justo v. Indymac Bancorp, 2010 WL 623715, *6 (C.D.Cal. 2010); Abdallah v. United Savings

Bank, 43 Cal.App.4th 1101, 1109 (1996); Miller and Starr CALIFORNIA REAL ESTATE § 10:4

(2010). Thus, the breach of fiduciary duty claim is subject to dismissal without leave to amend.

III. VIOLATION OF CALIFORNIA CIVIL CODE § 2923

The third cause of action contends that Defendant has violated California Civil Code §

2923 because Defendant has failed to negotiate a loan modification with Plaintiff. The complaint

alleges that Defendant did not provide Plaintiff with a good faith valuation regarding Plaintiff’s

options or offer a loan modification or workout plan in order to assist Plaintiff avoiding

foreclosure.

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A. Section 2923.5

It is possible that California Civil Code Section 2923.5 provides a borrower with a private

cause of action. See Molina v. Washington Mut. Bank, 2010 WL 431439 at *10 n.4 (S.D.Cal.

2010); Sharma v. Provident Funding Associates, LP, 2010 WL 143473 at *2 (N.D.Cal. 2010). 

But see Yulaeva v. Greenpoint Mortg. Funding, Inc., 2009 WL 2880393, * 11 (E.D.Cal. 2009)

(assuming without deciding that Section 2923.5 does not provide a private right of action). 

Regardless of whether a private right of action is available under Section 2923.5, the complaint

fails to allege sufficient to state a cause of action for a violation of Section 2923.5. 

Section 2923.5 requires the mortgagee, beneficiary, or authorized agent to contact the

borrower in person or by telephone “in order to assess the borrower's financial situation and

explore options for the borrower to avoid foreclosure.” Cal. Civ.Code § 2923.5(a)(2). In addition,

the statute requires the Notice of Default to “include a declaration from the mortgagee,

beneficiary, or authorized agent that it has contacted the borrower, tried with due diligence to

contact the borrower as required by this section, or the borrower has surrendered the property to

the mortgagee, trustee, beneficiary, or authorized agent.” Cal.Civ.Code § 2923.5(b). 

The statute only requires Defendant to have contacted or attempted to contact Plaintiff in a

good faith effort to avoid foreclosure. The statute does not require Defendant to have negotiated

with Plaintiff or explore other options with Plaintiff. Plaintiff does not allege in the complaint

that Defendant failed to contact her or attempt to contact her before filing the Notice of Default. 

Such contact is all that is required by Section 2923.5. 

Copes of the Notices of Default over which the court takes judicial notice provide

evidence that attempts to contact Plaintiff were made as required by Section 2923.5. See Exhibit

2; Exhibit 7; Exhibit 12. The court has been given no reason to question the accuracy of the

statements in the Notices of Default. In light of the statements in the Notices of Default and

Plaintiff’s lack of allegations to the contrary, Plaintiff cannot state a cause of action for violations

of Section 2923.5. Thus, Plaintiff’s claim under Section 2923.5 is dismissed with leave to

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amend.

B. Section 2923.6

It is possible that the third cause of action also alleges that Defendant’s failure to provide

Plaintiff with a good faith valuations regarding Plaintiff’s options, offer loan modifications, or

work out a plan in order to assist Plaintiff violated California Civil Code § Section 2923.6. 

Defendant contends that Section 2923.6 does not provide Plaintiff with a private cause of action. 

Section 2923.6 provides in relevant part: 

(a) The Legislature finds and declares that any duty servicers may have to

maximize net present value under the pooling and servicing agreements is owed to

all parties in a loan pool, not to any particular parties, and that a servicer acts in the

best interests of all parties if it agrees to or implements a loan modification or

workout plan for which both of the following apply: 

(1) The loan is in payment default, or payment default is reasonably foreseeable. 

(2) Anticipated recovery under the loan modification or workout plan exceeds the

anticipated recovery through foreclosure on a net present value basis. 

(b) It is the intent of the Legislature that the mortgagee, beneficiary, or authorized

agent offer the borrower a loan modification or workout plan if such a modification

is consistent with its contractual or other authority. 

Under California law, the adoption of a regulatory statute does not automatically create a

private right to sue for damages resulting from violations of the statute. Moradi-Shalal v.

Fireman's Fund Ins. Companies, 46 Cal.3d 287, 294-95 (1988). “A statute creates a private right

of action only if the enacting body so intended.” Grodensky v. Artichoke Joe's Casino, 171

Cal.App.4th 1399, 1420 (2009). If the Legislature intends to create a private cause of action it

will do so directly, in clear, understandable, unmistakable terms. Moradi-Shalal, 46 Cal.3d at

294-95 Plaintiff has not proffered any authority, and the court has found none, conclusively

holding that Section 2923.6 creates a private right of action for borrowers such as Plaintiff. 

The courts that have examined this issue have found that from its plain language, Section

2923.6 does not grant any right to a loan modification. Kuoha v. Equifirst Corp., 2009 WL

3248105 at *5 (S.D.Cal. 2009); Lopez v. Equifirst Corp., N 2009 WL 3233912 at *3 (E.D.Cal.

2009); Tapia v. Aurora Loan Servs., 2009 WL 2705853 at *2 (E.D.Cal. 2009); Anaya v. Advisors

Lending Group, 2009 WL 2424037 at * 8 (E.D.Cal. 2009); Farner v. Countrywide Home Loans,

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2009 WL 189025 at *2 (S.D.Cal. 2009). In addition, as numerous other district courts have

recognized, there is nothing in the language of Section 2923.6 suggesting that it creates a private

right of action for purported violations of its provisions. See, e.g., Owens v. Wells Fargo Bank,

N.A. 2010 WL 424473 at *2 (N.D.Cal. 2010); Collins v. Power Default Services, Inc., 2010 WL

234902 at *2 (N.D.Cal. 2010); Glover v. Fremont Inv. and Loan, 2009 WL 5114001 at *7 (N.D.

Cal. 2009); Reynoso v. Chase Home Finance, 2009 WL 5069140 at *4 -5 (N.D.Cal. 2009);

Fimbres v. Chapel Mortg. Corp., 2009 WL 4163332, *14 (S.D. Cal. 2009); Gaitan v. Mortgage

Elec. Registration Sys., 2009 WL 3244729 at *7 (C.D.Cal. 2009); Lopez, 2009 WL 3233912 at

*3; Tapia, 2009 WL 2705853 at *2 (E.D.Cal. 2009); Anaya, 2009 WL 2424037 at *8; Farner,

2009 WL 189025 at *2 (S.D.Cal. 2009); Paek v. Plaza Home Mortg., Inc., 2009 WL 1668576 at

*3 (C.D.Cal. 2009); Alford v. Wachovia Bank/World Savings Bank, L 2009 WL 1615989 at *8

(S.D.Cal. 2009). Because Section 2923.6 neither requires Defendant to offer or accept a

modification to Plaintiff's loan nor authorizes a cause of action for borrowers who are not given

loan modifications, Plaintiff’s claim against Defendant under Section 2923.6 fails as a matter of

law. Because this defect cannot be cured, the claim is dismissed without leave to amend.

IV. INJUNCTION

Plaintiff’s fourth cause of action seeks to enjoin the trustee’s sale of the subject property. 

Defendant seeks to dismiss the fourth cause of action as an improper cause of action.

Under Federal law, an injunction is a remedy to another claim or cause of action and not a

claim or cause of action in and of itself. Lima v. American Home Mortg. Servicing, Inc., 2010

WL 144810 at *2 (N.D.Cal. 2010); see also Washington Toxics Coalition v. Environmental

Protection Agency, 413 F.3d 1024, 1034 (9 Cir. 2005) (holding injunction is remedy for th

violation of the Endangered Species Act); Catholic Social Services, Inc. v. I.N.S., 182 F.3d 1053,

1062 (9 Cir. 1999) (stating injunction is remedy for claims against INS). Similarly, under th

California law, a claim or cause of action for an injunction is improper because an injunction is a

remedy, not a cause of action. Shamsian v. Atlantic Richfield Co., 107 Cal.App.4th 967, 985

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(2003); Roberts v. Los Angeles County Bar Ass'n, 105 Cal.App.4th 604, 618 (2003). Because an

injunction is merely a remedy and it is not a cause of action, a cause of action must exist before

injunctive relief may be granted. Tapia v. Aurora Loan Services, LLC, 2009 WL 2705853 at *3

(E.D.Cal. 2009). Thus, Plaintiff’s purported cause of action for injunctive relief must be

dismissed. However, the court will permit Plaintiff to amend the complaint to request injunctive

relief as a remedy.

ORDER

For the reasons stated in the above memorandum opinion, the court ORDERS that:

1. Defendant Sand Canyon Corporation’s, sued as Option One Mortgage Corporation,

motion to dismiss is GRANTED;

2. The complaint is DISMISSED with leave to amend the complaint’s TILA

rescission claim, leave to amend the complaint’s Section 2923.5 claim, and leave

to seek an injunction as a remedy;

3. The complaint is DISMISSED without leave to amend the complaint’s TILA

damages claim, breach of fiduciary duty claim, and Section 2923.6 claim;

4. Any amended complaint SHALL be filed and served no later than May 25, 2010;

5. Plaintiff is advised that any amended complaint must be based upon a wellfounded belief that a cognizable or arguable legal theory exists that would support

the complaint’s theory. See Fed.R.Civ.P. 11; and

6. Plaintiff is forewarned that failure to file an amended complaint will result in

dismissal of this action.

IT IS SO ORDERED.

Dated: April 27, 2010 /s/ Anthony W. Ishii 

0m8i78 CHIEF UNITED STATES DISTRICT JUDGE

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