Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_08-cv-01911/USCOURTS-casd-3_08-cv-01911-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1441 Petition for Removal- Breach of Contract

---

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

1 08cv1911 BTM(WMc)

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

ROBERTO HERNANDEZ AND

YOLANDA HERNANDEZ,

Plaintiffs,

CASE NO. 08cv1911 BTM(WMc)

ORDER GRANTING MOTION TO

DISMISS AND DENYING MOTION

FOR A MORE DEFINITE

STATEMENT AS MOOT

vs.

DSL SERVICE COMPANY, DOE 1 and

DOES 2-50, inclusive, 

Defendants.

Defendant DSL Service Company (“Defendant” or “DSL”) has filed a motion to dismiss

for failure to state a claim upon which relief may be granted or, in the alternative, for a more

definite statement. For the reasons discussed below, Defendant’s motion to dismiss is

GRANTED, and Defendant’s motion for a more definite statement is DENIED AS MOOT.

I. BACKGROUND

On August 20, 2008, Plaintiffs commenced this action in the Superior Court of

California, County of San Diego. On October 17, 2008, Defendant removed the action to

federal court.

Plaintiffs are the owners of the real property located at 540 Drew View Lane, San

Diego, California 92113 (“Property”). (Compl. ¶ 6.) Plaintiffs allege that DSL and the Doe

defendants are proceeding toward a Trustee’s sale of the Property (Compl. ¶ 5.) Plaintiffs

Case 3:08-cv-01911-BTM-WMC Document 8 Filed 02/02/09 Page 1 of 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

2 08cv1911 BTM(WMc)

allege, “Upon information and belief, DOE 1 is not the holder of the note identified in the

security instrument, is not in possession of the note properly endorsed to it, nor is it otherwise

entitled by law in this State to initiate foreclosure under the security instrument identified in

Exhibit 1.” (Compl. ¶ 7.) Plaintiffs claim that DOE 1 has no right to initiate foreclosure or

direct DSL to foreclose or sell the Property. (Compl. ¶ 8.)

Plaintiffs allege that although their attorney demanded proof of Defendants’ right to

proceed in foreclosure, Defendants have not offered any proof. (Compl. ¶ 10.) Plaintiffs

further allege that their attorney demanded a detailed accounting of the amount Defendants

stated must be paid to redeem the Property from foreclosure. (Compl. ¶ 11.) According to

Plaintiffs, any response by Defendants has been so inadequate that Plaintiffs have been

prevented from determining whether any or all of the charges included in the payoff demand

were justified. (Id.) Plaintiffs also allege that Defendants have added costs and charges to

the payoff amount that are not justified or proper under the terms of the note or the law.

(Compl. ¶ 17.) 

The Complaint sets forth the following causes of action: (1) unfair debt collection

practices; (2) predatory lending practices; and (3) RICO violations.

II. STANDARD

Under Fed. R. Civ. P. 8(a)(2), the plaintiff is required only to set forth a “short and plain

statement” of the claim showing that plaintiff is entitled to relief and giving the defendant fair

notice of what the claim is and the grounds upon which it rests. Conley v. Gibson, 355 U.S.

41, 47 (1957). A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) should

be granted only where a plaintiff's complaint lacks a "cognizable legal theory" or sufficient

facts to support a cognizable legal theory. Balistreri v. Pacifica Police Dept., 901 F.2d 696,

699 (9th Cir. 1988). When reviewing a motion to dismiss, the allegations of material fact in

plaintiff’s complaint are taken as true and construed in the light most favorable to the plaintiff.

See Parks Sch. of Bus., Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). Although

detailed factual allegations are not required, factual allegations ”must be enough to raise a

Case 3:08-cv-01911-BTM-WMC Document 8 Filed 02/02/09 Page 2 of 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

3 08cv1911 BTM(WMc)

right to relief above the speculative level.” Bell Atlantic v. Twombly, 550 U.S. 544, 127 S.Ct.

1955, 1965 (2007). “A plaintiff’s obligation to prove 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.” Id.

III. DISCUSSION

DSL moves to dismiss Plaintiffs’ Complaint for failure to state a claim, or, in the

alternative, for a more definite statement. The Court grants DSL’s motion to dismiss for

failure to state a claim. As discussed below, although Plaintiffs generally allege violations

of certain statutes, Plaintiffs fail to allege how DSL violated the statutes or plead sufficient

facts establishing a violation.

A. Unfair Debt Collection Practices

Plaintiffs allege that Defendants have violated “provisions of California’s Rosenthal

Fair Debt Collection Practices Act (“RFDCPA”), including but not limited to Civil Code § 1788

(e) and (f), and the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C., Title 41,

Subchap. V. §§ 1692 et seq. and the Real Estate Settlement Procedures Act (“RESPA”), 12

U.S.C. §§ 2601-2617.” (Compl. ¶ 20.) 

With respect to the FDCPA and the RESPA, Plaintiffs do not specify what provision(s)

of these acts DSL violated or what DSL in particular did to violate the acts. It appears that

Plaintiff may intend to assert a claim that DSL violated the RESPA, 12 U.S.C. § 2605(e), by

failing to take adequate action with respect to Plaintiffs’ inquiry regarding the pay-off amount.

Under § 2605(e), after a servicer of a federally related mortgage loan receives a qualified

written request from the borrower for information relating to the servicing of such loan, the

servicer shall provide a written response acknowledging receipt of the correspondence within

20 days and must take action on the request within 60 days. However, it is unclear whether

Plaintiffs are the “borrower.” The Complaint does not state that they are, and Exhibit 1 to the

Complaint shows that the Deed of Trust securing the note was executed by Luis M. Flores,

Case 3:08-cv-01911-BTM-WMC Document 8 Filed 02/02/09 Page 3 of 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

4 08cv1911 BTM(WMc)

not Plaintiffs. 

As for Plaintiffs’ claim under the RFDCPA, Plaintiffs cite to Cal. Civ. Code § 1788 (e)

and (f). The Court assumes that Plaintiffs intended to cite to Cal. Civ. Code § 1788.10(e) and

(f) (there is no § 1788(e) or (f)). Subsection (e) provides that no debt collector shall collect

or attempt to collect a consumer debt by “the threat to any person that nonpayment of the

consumer debt may result in . . . the seizure, garnishment, attachment or sale of any property

. . . unless such action is in fact contemplated by the debt collector and permitted by the law.”

Subsection (f) prohibits the collection or attempted collection of debts by “[t]he threat to take

any action against the debtor which is prohibited by this title.” 

The Complaint does not allege facts establishing a violation of subsections (e) and/or

(f). Plaintiffs contend that the foreclosure of their home is not permitted by law because DOE

1 is not the holder of the note identified in the security instrument. (Compl. ¶¶ 7-8.)

However, it appears that Plaintiffs are just speculating that DOE 1 has initiated the

foreclosure proceedings and is not in a legal position to do so due to an invalid assignment

of rights or otherwise. Plaintiffs do not provide any facts in support of their allegations and,

instead, rely upon mere “information and belief.” (Compl. ¶ 7.) These allegations do not

raise Plaintiffs’ right to relief above a speculative level. To the extent that Plaintiffs contend

that DOE 1 must possess the original note to initiate foreclosure proceedings, Plaintiffs have

not cited legal authority supporting such a dubious proposition.

Plaintiffs have not stated a claim against DSL under the FDCPA, RESPA, or the

RFDCPA. Therefore, the Court grants DSL’s motion as to Plaintiffs’ Unfair Debt Collection

Practices Act cause of action.

B. Predatory Lending Practices

Plaintiffs allege that Downey Savings, the original lender, engaged in deceptive

practices ”in violation of the Home Ownership and Equity Protection Act (“HOEPA”), 15

U.S.C. § 1637, the Truth in Lending Act (“TILA”), 15 U.S.C. § 1601, Regulation Z, 12 C.F.R.

226, and the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. §§ 41-58, the specifics

Case 3:08-cv-01911-BTM-WMC Document 8 Filed 02/02/09 Page 4 of 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

5 08cv1911 BTM(WMc)

of which are unknown, but which are subject to discovery and with respect to which the

specifics will be alleged by amendment to this complaint when ascertained.” (Compl. ¶ 23.)

Plaintiffs further allege that DOE 1 is “subject to defenses that would have been available

against Equifirst.” (Compl. ¶ 22.) It is unclear whether Plaintiffs intend to allege this cause

of action against DSL. To the extent that they do, Plaintiffs do not state how DSL, a trustee,

violated the various statutes or can be held liable for any violations by Downey Savings or

DOE 1. Accordingly, the Court dismisses this cause of action for failure to state a claim. 

C. RICO 

Plaintiffs allege that Defendants violated the RICO statute, 18 U.S.C. §§ 1961, et seq.,

by participating in a scheme of racketeering. (Comp. ¶ 26.) Again, Plaintiffs do not specify

what provision of the RICO statute Defendants allegedly violated, nor do they allege the

elements of a civil RICO claim – i.e., (1) conduct (2) of an enterprise (3) through a pattern

(4) of racketeering activity (5) causing injury to plaintiff’s business or property. Living

Designs, Inc. v. E.I. Dupont de Nemours & Co., 431 F.3d 353, 361 (9th Cir. 2005). Although

Plaintiffs make the conclusory claim that Defendants “have participated in a scheme of

racketeering,” Plaintiffs fail to identify the predicate acts that form the basis of the alleged

“scheme of racketeering.” See Izenberg v. ETS Services, LLC, __ F. Supp. 2d __, 2008 WL

5179088 at *7 (C.D. Cal. Dec. 8, 2008). Therefore, this cause of action is dismissed for

failure to state a claim. 

IV. CONCLUSION

For the reasons discussed above, Defendant DSL’s motion to dismiss is GRANTED,

and DSL’s motion for a more definite statement is DENIED AS MOOT. Plaintiffs’ Complaint

is DISMISSED WITHOUT PREJUDICE. The Court grants Plaintiffs leave to file an amended

complaint addressing the deficiencies identified above. Any amended complaint must be

filed within 30 days of the filing of this order. If Plaintiffs do not file an amended complaint

within the prescribed time, the Court shall order the Clerk to enter judgment dismissing this

Case 3:08-cv-01911-BTM-WMC Document 8 Filed 02/02/09 Page 5 of 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

6 08cv1911 BTM(WMc)

case without prejudice, and the case shall be closed.

IT IS SO ORDERED.

DATED: February 2, 2009

Honorable Barry Ted Moskowitz

United States District Judge

Case 3:08-cv-01911-BTM-WMC Document 8 Filed 02/02/09 Page 6 of 6