Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_14-cv-01021/USCOURTS-azd-2_14-cv-01021-4/pdf.json

Nature of Suit Code: 360
Nature of Suit: Other Personal Injury
Cause of Action: 15:0045 Federal Trade Commission Act

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WO 

 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Shizue S. White, 

Plaintiff, 

v. 

Aurora Loan Services LLC, et al., 

Defendants. 

No. CV-14-01021-PHX-JAT

ORDER 

 Pending before the Court is Defendants’ Motion for Summary Judgment, 

(Doc. 78), and Plaintiff’s Response/Cross Motion for Summary Judgment to Defendant’s 

[sic] Motion for Summary Judgment, (Doc. 81). The Court now rules on the motions. 

I. Factual Background1

In 1998, Plaintiff and her husband (the “Whites”) obtained a loan from Old Kent 

 

1

 The Local Rules of Civil Procedure for the District of Arizona (“Local Rules”) 

require a party opposing a summary judgment motion to file a controverting statement of 

facts either agreeing with or disputing each of the moving party’s statements of fact. 

LRCiv 56.1(b). If a non-movant disputes a statement of fact, she must point to admissible 

evidence showing that a genuine dispute exists. Id. If a non-movant does not properly 

address a statement of fact, the Court may consider that fact undisputed for purposes of 

the motion. Fed. R. Civ. P. 56(e)(2). Here, Plaintiff did not file a controverting statement 

of facts, nor did she otherwise respond to Defendants’ factual assertions. Although she 

objected to some of the evidence used to support Defendants’ statement of facts, Plaintiff 

did not address the facts themselves. See (Doc. 80 at 12). The Court will therefore deem 

Defendants’ statement of facts undisputed unless the record proves otherwise and will 

grant summary judgment “if the motion and supporting materials—including the facts 

considered undisputed—show that the movant is entitled to it.” Fed. R. Civ. P. 56(e)(3). 

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Mortgage Company to purchase real property located in Sun City, Arizona. (Doc. 79 at 

1). In 2003, Plaintiff refinanced the 1998 loan with First Magnus Financial Corporation. 

(Id. at 2). In 2006, Plaintiff refinanced again, this time with Credit Union West. (Id.) 

Finally, in March 2007, Plaintiff initiated and completed a third refinance with American 

Brokers Conduit (“ABC”), which is evidenced by a Promissory Note and Deed of Trust. 

(Id.) Plaintiff’s third refinance is the subject of this lawsuit. 

 At the time of the March 2007 refinance, Plaintiff was an elderly widow who had 

lived in the United States for over fifty years after emigrating from Japan. (Id. at 3). 

Before moving to Arizona, Plaintiff owned and operated a successful daycare business in 

California for twenty years. (Id. at 1). Plaintiff’s husband spoke no Japanese, and English 

was the “near-exclusive” language spoken in the Whites’ household. (Id.) 

 Sometime in early 2007, Plaintiff called a lender seeking a lower monthly 

payment on her mortgage. (Id. at 2). The lender stated that “we can do something with 

interest only.” (Id.) In March 2007, a lender representative went to Plaintiff’s house to 

conduct the closing. (Doc. 79-1 at 114). The representative was “professional,” spoke 

exclusively English during the closing, and did not rush Plaintiff into signing the 

documents or discourage her from taking the documents to someone else for review. 

(Doc. 79 at 2–3). 

 Included in the closing documents was the Promissory Note describing Plaintiff’s 

obligation to repay the loan. At the heart of this dispute are the Note’s payment options 

and negative amortization features. These terms were disclosed to Plaintiff at closing, 

including the following statement on the first page of the Note, in bold, capital type: 

THIS NOTE CONTAINS PROVISIONS ALLOWING FOR 

CHANGES IN MY INTEREST RATE AND MY MONTHLY 

PAYMENT. DURING THE FIRST 5 YEARS OF THIS NOTE, MY 

MONTHLY PAYMENT MAY NOT FULLY PAY THE INTEREST 

THAT ACCRUES. AS A RESULT, THE PRINCIPAL AMOUNT I 

REPAY MAY BE LARGER THAN THE AMOUNT ORIGINALLY 

BORROWED. 

(Id. at 3). The closing documents also included a four-page “Variable Rate Mortgage 

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Program Disclosure,” which outlined the general aspects of variable rate mortgages. (Id.) 

During her deposition, Plaintiff testified that she understood the concept of an interestonly loan and could comprehend the interest-only disclosures and variable rate mortgage 

documents that she signed at closing. (Id.) However, despite understanding that a 

promissory note creates a binding legal obligation to repay the underlying loan, Plaintiff 

did not read any of the documents before she signed them at closing. (Id. at 3–4). 

 After the March 2007 closing, Plaintiff received monthly statements expressly 

detailing her payment options and their impact on the loan’s principal. (Id. at 4). 

Specifically, the monthly statements explained the differences between an accelerated 

payment, a full monthly payment, an interest-only payment, and a minimum payment that 

did not fully cover the accrued monthly interest. (Id.) For example, the statements 

described “minimum amount due” as “[t]his amount will not be sufficient to pay all the 

accrued interest for the month or to pay the loan in full over the remaining term in equal 

monthly installments. Therefore negative amortization may result and any deferred 

interest will be added to the balance of your loan.” (Doc. 79-2 at 4). Despite the four 

payment options available to her, Plaintiff chose to make minimum payments which, in 

turn, increased the loan’s principal. (Doc. 79 at 4). Plaintiff testified that she first noticed 

the increased principal balance in 2008, but did not take any action until the minimum 

payment period expired in 2011. (Id.) At that point, Plaintiff spoke with her son about the 

principal increase. (Id.) This lawsuit was filed in May 2014. (Doc. 1). 

 Regarding the ownership and property interests in the Note and Deed of Trust, the 

original lender on the Note was ABC. (Doc. 79 at 1). At that time, the Note was secured 

by a Deed of Trust under which the Trustee was Chicago Title Insurance Company and 

the beneficiary was Mortgage Electronic Registrations Systems, Inc. (“MERS”). (Id.; 

Doc. 79-1 at 230–45). In September 2007, ABC hired Aurora Loan Services, L.L.C. 

(“Aurora”) to service the Note. (Doc. 79 at 6). In July 2012, Nationstar Mortgage, L.L.C. 

(“Nationstar”) became the servicer of the Note after it acquired Aurora. (Id.) On 

November 7, 2013, MERS, “as nominee for [ABC], its successors and/or assigns,” 

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assigned the Note and its proceeds to U.S. Bank as Trustee for the Certificate Holders of 

the LXS 2007 7N Trust Fund (“U.S. Bank”). (Doc. 79-2 at 51–52).2

 Currently, U.S. Bank 

is the sole beneficiary of the Deed of Trust and possesses the original Note, endorsed in 

blank, through its agent Nationstar. (Id.)

3

 On February 26, 2014, Nationstar, “as Attorney 

in Fact for U.S. Bank,” appointed Clear Recon Corporation as Trustee of the Deed of 

Trust. (Doc. 13-1 at 48). Subsequently, Clear Recon Corporation noticed a Trustee’s 

Sale, which this Court enjoined. (Doc. 29). 

II. Legal Standard for Summary Judgment 

 Summary judgment is appropriate when “the movant shows that there is no 

genuine issue as to any material fact and that the moving party is entitled to summary 

judgment as a matter of law.” Fed. R. Civ. P. 56(a). A party asserting that a fact cannot be 

or is genuinely disputed must support that assertion by “citing to particular parts of 

materials in the record,” including depositions, affidavits, interrogatory answers or other 

 

2

 To the extent Plaintiff objects to this document on hearsay, authentication, or 

foundational grounds, the Court overrules the objection. See (Doc. 80 at 12) (objecting to 

Nationstar’s Declaration and “any document premised upon it”). Plaintiff’s objection to 

the Declaration appears to be that the declarant did not personally review the information 

attested to in the Declaration. (Id.) However, the Declaration states that (1) the declarant 

“has access to” and “knowledge of” Nationstar’s computer database containing its 

business records, (2) “[t]he information described herein and referenced below is found 

in Nationstar’s computer database,” and (3) “[b]ased upon the records contained in the 

computer database, I have gained knowledge of the facts set forth herein.” (Doc. 79-2 at 

20–22). It is clear from the Declaration that the declarant has personal knowledge of the 

records to which he refers and is authorized to make the Declaration. In any event, 

Plaintiff makes no objection to this particular document, which is a notarized “Corporate 

Assignment of Deed of Trust” from MERS to U.S. Bank. (Id. at 51–52). Thus, Plaintiff’s 

objection is overruled. 

3

 On August 31, 2012, MERS, as nominee for ABC, assigned the beneficial 

interest in the Deed of Trust to Nationstar. (Doc. 79-1 at 51–52). Then, on November 7, 

2013, MERS, again as nominee for ABC, assigned the Deed of Trust, including MERS’ 

“beneficial interest under the Deed of Trust” to U.S. Bank. (Doc. 38-1 at 21). Based on 

Defendants’ filings, the Court has found that MERS’ August 31, 2012 assignment to 

Nationstar is no longer operative and Nationstar relinquished any property or beneficial 

interest it may have had in the Deed of Trust. (Doc. 66 at 4). 

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materials, or by “showing that materials cited do not establish the absence or presence of 

a genuine dispute, or that an adverse party cannot produce admissible evidence to support 

the fact.” Id. at 56(c)(1). Thus, summary judgment is mandated “against a party who fails 

to make a showing sufficient to establish the existence of an element essential to that 

party’s case, and on which that party will bear the burden of proof at trial.” Celotex Corp. 

v. Catrett, 477 U.S. 317, 322 (1986).

 Initially, the movant bears the burden of pointing out to the Court the basis for the 

motion and the elements of the causes of action upon which the non-movant will be 

unable to establish a genuine issue of material fact. Id. at 323. The burden then shifts to 

the non-movant to establish the existence of material fact. Id. The non-movant “must do 

more than simply show that there is some metaphysical doubt as to the material facts” by 

“com[ing] forward with ‘specific facts showing that there is a genuine issue for trial.’” 

Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586–87 (1986) (quoting 

Fed. R. Civ. P. 56(e) (1963) (amended 2010)). A dispute about a fact is “genuine” if the 

evidence is such that a reasonable jury could return a verdict for the nonmoving party. 

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The non-movant’s bare 

assertions, standing alone, are insufficient to create a material issue of fact and defeat a 

motion for summary judgment. Id. at 247–48. Further, because “[c]redibility 

determinations, the weighing of the evidence, and the drawing of legitimate inferences 

from the facts are jury functions, not those of a judge, . . . [t]he evidence of the 

nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor” at 

the summary judgment stage. Id. at 255 (citing Adickes v. S.H. Kress & Co., 398 U.S. 

144, 158–59 (1970)); Harris v. Itzhaki, 183 F.3d 1043, 1051 (9th Cir. 1999) (“Issues of 

credibility, including questions of intent, should be left to the jury.” (citations omitted)). 

 At the summary judgment stage, the trial judge’s function is to determine whether 

there is a genuine issue for trial. There is no issue for trial unless there is sufficient 

evidence favoring the non-moving party for a jury to return a verdict for that party. 

Liberty Lobby, 477 U.S. at 249–50. If the evidence is merely colorable or is not 

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significantly probative, the judge may grant summary judgment. Id. Notably, “[i]t is well 

settled that only admissible evidence may be considered by the trial court in ruling on a 

motion for summary judgment.” Beyene v. Coleman Sec. Servs., Inc., 854 F.2d 1179, 

1181 (9th Cir. 1988). 

III. Defendants’ Motion for Summary Judgment 

Plaintiff asserts five tort claims against Defendants, namely, negligence, common 

law fraud, violations of the Arizona Consumer Fraud Act (“CFA”) and Fair Debt 

Collections Practices Act (“FDCPA”), and misrepresentation. (Doc. 1 at 7–16).4

 Plaintiff 

also seeks injunctive and equitable relief. (Id.) Defendants move for complete summary 

judgment. (Doc. 78). The Court will analyze each of Plaintiff’s claims in turn. 

A. Statutes of Limitation 

To begin, Defendants argue that Plaintiff’s five tort claims are barred by their 

respective statutes of limitation. (Doc. 78 at 5–6). In response, Plaintiff contends that 

“equitable tolling” applies because she has alleged “extraordinary circumstances” that 

warrant tolling of the limitation periods. (Doc. 80 at 13).5

 Specifically, Plaintiff argues 

that “[t]he determination of the genuine issue as to the purchase of America [sic] Brokers 

Conduits [sic] assets while in an active bankruptcy and the further factual determination 

if such transfer was with or without [the Bankruptcy] Court’s consent as well and the 

precipitous ramifications thereof may meet and exceed the standard required to apply 

equitable suspension or tolling.” (Id. at 14). Plaintiff also cites two Arizona statutes that 

allegedly designate a “[s]tatutory exception that may apply to suspend or legally toll the 

limitations period in this matter.” (Id. at 13) (citing Ariz. Rev. Stat. §§ 12-501, 43-722). 

Plaintiff, however, does not explain how statutes involving a person’s absence from a 

 

4

 The operative complaint is Plaintiff’s original Complaint filed at Docket No. 1. 

See (Doc. 68). Despite being granted leave to file an amended complaint, see (Doc. 67), 

Plaintiff did not do so, see (Doc. 68). 

5

 The Court assumes this is Plaintiff’s argument despite Plaintiff stating that “the 

doctrine of equitable tolling, a concept rooted in common law, is not applicable here.” 

(Id.) (citation omitted). 

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state, see Ariz. Rev. Stat. § 12-501, or the assessment of properties in bankruptcy or 

receivership proceedings, see id. § 43-722, apply to this case. Because both statutes are 

inapplicable, the Court will focus its analysis on the doctrine of equitable tolling. 

 1. Legal Standard for Equitable Tolling6

 

 In Arizona, “whether to apply equitable tolling is a question the trial court, not the 

jury, should determine.” McCloud v. State, 170 P.3d 691, 695 (Ariz. Ct. App. 2007). 

Under this doctrine, Plaintiff “may sue after the statutory time period for filing a 

complaint has expired if [she] ha[s] been prevented from filing in a timely manner due to 

sufficiently inequitable circumstances.” Id. (citation omitted). While courts have applied 

equitable tolling in a variety of circumstances, such requests should be granted 

“sparingly.” See id. (collecting cases). Ultimately, to obtain relief via equitable tolling, 

Plaintiff must “establish extraordinary circumstances” that were “beyond [her] control[, 

making] it impossible to file the claims on time.” Id. at 696 (citations omitted); see Porter 

v. Spader, 239 P.3d 743, 747 (Ariz. Ct. App. 2010) (“[A] defendant whose affirmative 

acts of fraud or concealment have misled a person from either recognizing a legal wrong 

or seeking timely legal redress may not be entitled to assert the protection of a statute of 

limitations.”). Plaintiff bears the burden of establishing such extraordinary circumstances 

“with evidence; [s]he cannot rely solely on personal conclusions or assessments.” 

McCloud, 170 P.3d at 695. 

 2. Negligence 

 Plaintiff’s first cause of action, negligence, is premised on her argument that 

Defendants breached a duty to her by “creating and enforcing” the March 2007 Note 

which allegedly included “unconscionable” terms. (Doc. 1 at 7). According to Plaintiff, 

Defendants “deceiv[ed]” her into believing that she could afford the repayment terms by 

“never expressly indicat[ing] that the terms of the NOTE contained negative amortization 

6

 Once again, Defendants did not cite Arizona law in their discussion regarding 

equitable tolling, choosing instead to cite a Ninth Circuit case interpreting California law. 

(Doc. 82 at 3–4). This is not the first time Defendants forewent applying binding Arizona 

precedent, despite a Court Order requiring them to do so. See (Doc. 39 at 10–11). 

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features.” (Id. at 5). In other words, Plaintiff claims that Defendants negligently harmed 

her during the loan’s origination in 2007. 

 The statute of limitations for a negligence claim in Arizona is two years. See Ariz. 

Rev. Stat. § 12-542(1); Bridges v. Safeway, Inc., 2012 WL 3193530, at *3 (Ariz. Ct. App. 

Aug. 7, 2012) (“When an action ‘sounds in negligence or tort,’ the applicable statute of 

limitations is A.R.S. § 12-542.”). Because Defendants’ alleged misconduct occurred 

during the loan’s origination in 2007 and this lawsuit was not filed until May 2014, 

Plaintiff’s negligence claim is time-barred unless “extraordinary circumstances” made it 

“impossible” for Plaintiff to file her claim on time. McCloud, 170 P.3d at 695.7

 

 In this regard, Plaintiff failed to support her argument that equitable tolling 

applies. Plaintiff avers “there is a contention that the actions of Defendant [sic], or agents 

or representatives, served to conceal the cause of action, misled Plaintiff in any fashion 

[sic], or caused Plaintiff to delay filing her complaint in a timely manner.” (Doc. 80 at 

13–14). The Court has reviewed the record in its entirety and finds that no such 

contentions have ever been alleged. Rather, the Complaint simply claims that Defendants 

“deceiv[ed]” Plaintiff into signing a note containing unconscionable terms, not that 

Defendants concealed the underlying cause of action. There is nothing in the record to 

suggest that this is a case where Defendants “induced” Plaintiff to forego litigation. See 

Certainteed Corp. v. United Pac. Ins. Co., 762 P.2d 560, 564 (Ariz. Ct. App. 1988). In 

fact, Plaintiff admitted that Defendants did not tell her anything untrue about the March 

2007 loan before she signed the closing documents, (Doc. 79-1 at 113), and has failed to 

point to any misleading statements made by Defendants thereafter. 

 Furthermore, Plaintiff did not present any evidence to support her concealment 

argument, and the record evidence proves to the contrary. Particularly, the allegedly 

unconscionable terms were disclosed in bold, all capital letters to Plaintiff at the March 

7

 Even if the Court were to find that Plaintiff’s negligence claim accrued when 

Defendants attempted to “enforce” the Note when the minimum payment period expired 

in 2011, the claim would still be time-barred by the two-year statute of limitations absent 

extraordinary circumstances. 

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2007 closing. (Doc. 79 at 3).8 The terms were also provided to Plaintiff every month 

thereafter via monthly statements that explained the four payment options and their 

impact on the loan’s principal. (Id. at 4). To be sure, the monthly statements expressly 

alerted Plaintiff that the minimum payment option “will not be sufficient to pay all of the 

accrued interest for the month or to pay the loan in full over the remaining term in equal 

monthly installments. Therefore, negative amortization may result and any deferred 

interest will be added to the balance of your loan.” (Doc. 79-2 at 4). Such intelligible9

 and 

perpetual disclosure critically belies Plaintiff’s argument that Defendants “concealed” 

their wrongdoings. Indeed, a cursory review of these documents would have informed 

Plaintiff all she needed to know about the effects of paying the minimum amount. 

 Finally, Plaintiff was certainly aware of the consequences of paying the minimum 

amount in 2008 when she claims to have first noticed the increased loan balance. 

(Doc. 79 at 4). Similarly, Plaintiff understood the impact of paying the minimum amount 

when she discussed the principal increase with her son in 2011 after the minimum 

payment period expired. (Id.) Accordingly, Plaintiff’s argument that Defendants 

concealed their purported misconduct is unpersuasive. 

 For these reasons, the two-year statute of limitations for Plaintiff’s negligence 

claim expired well before she filed this lawsuit in May 2014. The Court will therefore 

grant Defendants’ motion for summary judgment on Plaintiff’s negligence claim.

 3. Common Law Fraud 

 As her second cause of action, Plaintiff asserts a claim for common law fraud. 

(Doc. 1 at 7–9). In her Complaint, Plaintiff contends that Defendants “[d]eceptively [led] 

Plaintiff to believe she could afford the terms of the NOTE,” “to believe her payments 

 

8

 The Court notes that this is not a case where the purportedly unconscionable 

terms were buried in a small-print, boilerplate sentence at the end of an eye-glazing 

contract. The Note itself is less than four full pages, and the disputed terms are disclosed 

in bold, all capital font on the top of the first page. See (Doc. 79-1 at 225–28). 

9

 Plaintiff’s son testified that the monthly statements “gave [Plaintiff] a menu of 

options that she could pay if that is what she wanted to do.” (Doc. 79-1 at 34). 

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would remain affordable throughout the duration of the loan,” and “to be unaware of the 

negative amortization features of the NOTE[.]” (Id. at 8–9). 

 In Arizona, common law fraud claims are subject to a three-year statute of 

limitations. Ariz. Rev. Stat. § 12-543(3). This period “begins to run when the plaintiff by 

reasonable diligence could have learned of the fraud, whether or not he actually learned 

of it.” Coronado Dev. Corp. v. Super. Ct. of Ariz., 678 P.2d 535, 537 (Ariz. Ct. App. 

1984) (citing Guerin v. Am. Smelting & Refining Co., 236 P. 684 (Ariz. 1925)). 

 For the reasons detailed in the preceding section, Plaintiff “by reasonable diligence 

could have learned” of the purported fraud either (1) by actually reading the loan 

documents in 2007, (2) after realizing the principal’s balance had increased in 2008, or 

(3) by simply reviewing the monthly statements. The fact that Plaintiff did not actually 

know of the alleged fraud at these times is irrelevant—Plaintiff, “by reasonable 

diligence,” could easily have done so. See Anderson v. City Van & Storage Co., 340 P.2d 

566, 568 (Ariz. 1959) (“Plaintiff claims she did not read the contract which, of course, is 

no defense to an action on contract.”). The Court will therefore grant Defendants’ motion 

for summary judgment on Plaintiff’s common law fraud claim.

 4. Arizona CFA 

To the extent Plaintiff’s Complaint alleges that Defendants committed consumer 

fraud during the origination of the loan in March 2007, (Doc. 1 at 11–12), any such claim 

is once again barred by the statute of limitations. “A consumer fraud claim must be filed 

within one year after the cause of action accrues.” Steinberger v. McVey, 318 P.3d 419, 

436 (Ariz. Ct. App. 2014); see Alaface v. Nat’l Inv. Co., 892 P.2d 1375, 1380 (Ariz. Ct. 

App. 1994) (“[A] consumer fraud action must be initiated within one year after the cause 

of action accrues.”); Murry v. W. Am. Mortg. Co., 604 P.2d 651, 654 (Ariz. Ct. App. 

1979) (“Since the Consumer Fraud Act creates a cause of action separate from common 

law fraud, an action commenced thereunder must be brought within one year as [it] 

requires.”); see also Ariz. Rev. Stat. § 12-541(5). Plaintiff did not file her consumer fraud 

claim—which is grounded in the same alleged misconduct as her common law fraud 

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claim—until May 2014. As a result, her consumer fraud claim is time-barred. 

 5. FDCPA 

 Plaintiff also asserts that Defendants violated the FDCPA due to the same 

allegedly misleading statements as her common law fraud and Arizona CFA claims. 

(Doc. 1 at 10–11). For the reasons set forth above, an FDCPA claim based on those 

statements is barred by the one-year statute of limitations, see 15 U.S.C. § 1692k(d), and 

the Court will grant Defendants’ motion for summary judgment on this count.10

 6. Misrepresentation 

Plaintiff’s seventh count, titled simply “misrepresentation,” alleges that 

Defendants “falsely assert[ed]” that Plaintiff could afford the terms of the loan and made 

“implied misrepresentations by approving” her for the loan. (Doc. 1 at 13). Again, this 

allegedly unlawful conduct occurred during loan origination in 2007. Thus, for the 

reasons outlined above, Plaintiff’s attempt to avail herself of equitable tolling fails, and 

her “misrepresentation” claim is time-barred by the statute of limitations. See Ariz. Rev. 

Stat. § 12-543(3) (three-year statute of limitations for fraudulent misrepresentation 

claims); Hullett v. Cousin, 63 P.3d 1029, 1034 (Ariz. 2003) (“The statute of limitations 

for a negligent misrepresentation claim is two years.” (citing Ariz. Rev. Stat. § 12-542)). 

 10 While immaterial to the Court’s holding, the Court notes that Plaintiff does not 

dispute Defendants’ contention that they are “loan servicers” and “not ‘debt collectors’ 

under the FDCPA.” See (Docs. 78 at 9–10; 79 at 5). Typically, the Court would consider 

the fact undisputed; yet, it would be asinine for the Court to stick its head in the sand 

when presented with a falsehood. The monthly statements that outlined Plaintiff’s 

payment options also disclosed: 

Important information regarding the Fair Debt Collection Practices 

Act and Bankruptcy Law 

Aurora Loan Services is a debt collector. Aurora Loan Services is 

attempting to collect a debt and any information obtained will be used for 

that purpose. 

(Doc. 79-2 at 4). Comparing Defendants’ statements that “Defendants are not ‘debt 

collectors’ under the FDCPA” and “Aurora is not a ‘debt collector,’” (Doc. 78 at 10), 

with the disclosure in the monthly statements that “Aurora Loan Services is a debt 

collector,” (Doc. 79-2 at 4), is troubling. In the future, it would behoove Defendants to 

double—if not triple—check the integrity of their arguments. 

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The Court will therefore grant Defendants’ motion for summary judgment on this claim. 

 7. Conclusion for Statutes of Limitation 

 For the foregoing reasons, the Court concludes that Plaintiff’s claims for 

negligence, common law fraud, violations of the Arizona CFA and FDCPA, and 

misrepresentation are barred by their respective statutes of limitation. Thus, summary 

judgment in favor of Defendants on these counts is appropriate. 

B. Remaining Claims11

Plaintiff’s Complaint also seeks injunctive and equitable relief. Particularly, 

Plaintiff’s sixth count is titled “Unlawful and Attempted Foreclosure,” while her eighth 

claim is termed “Equitable Estoppel.” (Doc. 1 at 12–13). Defendants move for summary 

judgment on both counts. (Doc. 78 at 10–13). The Court will address each in turn. 

 1. “Unlawful and Attempted Foreclosure”12

 As her sixth cause of action, Plaintiff asserts a claim for “unlawful and attempted 

foreclosure.” (Doc. 1 at 12). To support this count, Plaintiff complains that Defendants 

engaged in “predatory lending” and committed several violations of the FDCPA. (Id.) 

Plaintiff also contends that “Defendants do not have any legal right to foreclose on 

Plaintiff’ [sic] property.” (Id.) In her summary judgment brief, Plaintiff attempted to 

clarify this claim by arguing that Defendants lack “standing” to foreclose on the property. 

(Doc. 80 at 8–11, 16). Specifically, Plaintiff—after “numerous hours of research”—

believes that the original lender, ABC, improperly assigned the Deed of Trust to 

Defendants’ principal, U.S. Bank, because ABC did not have any interest to assign after 

 

11 Plaintiff makes several discovery-related arguments in her summary judgment 

briefing. See (Doc. 80 at 8–12). The time for discovery disputes has long since passed 

and asserting same at summary judgment directly violates the Court’s Rule 16 

Scheduling Order. See (Doc. 56 at 2) (“[T]he Court will not entertain discovery disputes 

after the close of discovery barring extraordinary circumstances.”). Plaintiff makes no 

attempt to explain what “extraordinary circumstances” apply here, and the Court finds 

that none exist. 

12 In a prior Order, the Court interpreted this count as “a claim for the cause of 

action to avoid a Trustee sale recognized in Steinberger.” (Doc. 39 at 9). 

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bankruptcy proceedings eliminated its interest in the Deed of Trust. (Id. at 9). In 

Plaintiff’s view, a disputed issue of material fact exists as to the validity of the 

assignment. (Id.) 

 In response, Defendants contend that the Court should disregard Plaintiff’s 

standing argument because it was not disclosed in the Complaint or at any point 

thereafter. (Doc. 82 at 7). In any event, Defendants explain that the assignment in 

question was not an assignment of any interest of ABC, but of the original Deed of Trust 

beneficiary, MERS, “as nominee for [ABC], its successors and/or assigns.” (Id.) Thus, 

according to Defendants, whether ABC had any interest to assign is irrelevant because 

the MERS’ assignment effectuated the transfer for ABC and its “successors and assigns.” 

(Id.) Defendants state that “regardless of who (if anyone) may have acquired [ABC]’s 

interest in the Deed of Trust (if any) through the bankruptcy proceeding, MERS was 

acting for that person as a matter of law.” (Id.) (citation omitted). Finally, Defendants 

insist that regardless of the assignment’s validity, “it is black-letter law in Arizona that an 

assignment of a deed of trust is not necessary to transfer an interest in the deed of trust.” 

(Id. at 8) (citing Ariz. Rev. Stat. § 33-817). Thus, because Defendants have shown that 

U.S. Bank is the holder of the Note, U.S. Bank “by definition” is the beneficiary of the 

Deed of Trust. (Id.) 

 To begin, Plaintiff provides no evidentiary support to buttress her argument that an 

alleged bankruptcy proceeding generates a disputed issue of material fact as to the 

assignment of the Deed of Trust. There is nothing in the record evidencing the alleged 

bankruptcy and mere attorney argument is not enough to create a disputed issue of 

material fact. See Liberty Lobby, 477 U.S. at 248. As the non-movant, Plaintiff bears the 

burden of showing that a disputed issue of material fact exists by pointing to actual 

evidence for the factfinder to consider. See Matsushita Elec. Indus., 475 U.S. at 586–87;

Steinberger, 318 P.3d at 430 (stating that a mortgagor “bears the burden of proving her 

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claim that [the mortgagee] lack[s] the authority to conduct a trustee’s sale”).13 Here, the 

only evidence in the record shows that U.S. Bank is the holder of the Note and 

beneficiary to the Deed of Trust, and that Nationstar, as “Attorney in Fact” for U.S. Bank, 

is the servicer of the Note. See (Docs. 79 at 6; 79-2 at 22–24, 34–37). As Attorney in 

Fact, Nationstar substituted the Trustee under the Deed of Trust, who subsequently 

noticed the Trustee’s Sale. (Docs. 79 at 6; 79-2 at 54–55, 57–58). Both actions are 

permitted under Arizona law. See Ariz. Rev. Stat. §§ 33-804, 33-807. Consequently, 

because it is undisputed that Plaintiff defaulted on her loan, Nationstar acted pursuant to 

its legal and statutory authority when it attempted to foreclose on the property. See 

Steinberger, 318 P.3d at 430 (explaining that a mortgagee can prove it is the “true” 

beneficiary or trustee of a deed of trust by providing “documents in the chain of title 

tracing [the mortgagee’s] beneficial interest from the original beneficiary, such as 

assignments, substitutions or a power of attorney”). 

 Plaintiff also appears to contend that unconscionability plays a role in this case 

beyond her negligence claim—though she does not explain in what context. See (Doc. 80 

 

13 Plaintiff objects to several sections in Defendants’ motion for summary 

judgment because she believes the sections are “conclusory in natural [sic]. Defendant 

[sic] simply states that no evidence exists rather than demonstrate to the [sic] how the 

facts of the [sic] leave no genuine issue of material fact.” (Doc. 80 at 12). Plaintiff fails to 

grasp rudimentary summary judgment procedure. As the movant, Defendants bore the 

burden of either pointing to evidence in the record showing that they are entitled to 

judgment as a matter of law or showing “that an adverse party cannot produce admissible 

evidence” sufficient to create a genuine dispute of material fact. Fed. R. Civ. P. 56(c)(1); 

see Celotex, 477 U.S. at 323 (explaining that summary judgment is mandated “against a 

party who fails to make a showing sufficient to establish the existence of an element 

essential to that party’s case, and on which that party will bear the burden of proof at 

trial”). The burden then shifted to Plaintiff as the non-movant to establish the existence of 

a disputed issue of material fact. See Celotex, 477 U.S. at 323. Thus, it was Plaintiff’s 

responsibility as the non-movant to point to a genuine dispute of material fact after 

Defendants established that no evidence supporting Plaintiff’s claims existed. In this 

regard, Plaintiff cited numerous exhibits that are not in the record and did not even file a 

separate controverting statement of facts or otherwise respond to each of Defendants’ 

factual assertions. 

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at 19–20). To the extent Plaintiff believes that the Note contained unconscionable terms 

thereby making foreclosure of the property unlawful, Plaintiff does not explain which 

terms are unconscionable, see (id.),14 nor did she respond to Defendants’ interrogatory 

asking her to “Identify all terms of the Note that You allege to be unconscionable, and 

describe in detail why each term is unconscionable,” (Doc. 79 at 5). In fact, Defendants 

even asked Plaintiff to admit “that an interest-only payment term is not unconscionable . . 

. [and] that a negative amortization term is not unconscionable” via Federal Rule of Civil 

Procedure (“Rule”) 36 requests for admissions. (Id.) Plaintiff did not respond, see (id.), 

and thus, the Court deems the requests admitted, see Fed. R. Civ. P. 36(a)(3).15

Accordingly, nothing in the record creates a disputed issue of material fact as to 

unconscionability of the Note.16

 

14 Insofar as Plaintiff believes that there was a “100% applicability of negative 

amortization to the balance” of the loan’s principal, (id.), her belief is misguided. As 

expressed above, it is undisputed that four payment options—including three that did not 

incorporate negative amortization—were regularly given to Plaintiff during the relevant 

time period. (Doc. 79 at 4). Plaintiff, in her discretion, chose to pay the minimum 

amount, which was clearly described as “not . . . sufficient to pay all the accrued interest 

for the month or to pay the loan in full over the remaining term in equal monthly 

installments. Therefore negative amortization may result and any deferred interest will be 

added to the balance of your loan.” (Doc. 79-2 at 4). In short, there was not a “100% 

applicability of negative amortization to the balance” of the loan’s principal. 

15 The Court notes that at the time Defendants served Plaintiff with these Rule 36 

requests for admission, Plaintiff was represented by counsel. See (Doc. 79-2 at 9–15). 

16 In any event, there is no evidence in the record that Defendants own a beneficial 

or property interest in the Deed of Trust or hold the Note in their individual capacity. See 

(Doc. 66 at 4). Consequently, challenging the conscionability of the Note’s terms as a 

basis for preventing Defendants from foreclosing on the property is improper as such a 

claim should have been brought against the holder of the Note, U.S. Bank, or Nationstar 

as Attorney in Fact for U.S. Bank. The Court explained this concept multiple times 

during this litigation and even suggested that Plaintiff could move to amend her 

complaint to add these parties. See (id. at 3–7; Doc. 39 at 3–6). As it stands, however, to 

the extent Plaintiff predicates her “unlawful and attempted foreclosure” count on the 

unconscionability of the Note, such a claim is improper against a party other than the 

holder of the Note. 

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 For the foregoing reasons, the Court will grant Defendants’ motion for summary 

judgment on Plaintiff’s “unlawful and attempted foreclosure” claim. 

 2. Equitable Estoppel 

As her eighth cause of action, Plaintiff asserts a claim for equitable estoppel. 

(Doc. 1 at 13). Equitable estoppel, however, is not a valid cause of action under Arizona 

law. See Sch. Dist. No. 69 v. Altherr, 458 P.2d 537, 544 (Ariz. Ct. App. 1969) 

(“[E]quitable estoppel is a shield, not a sword, hence it forms no basis for a cause of 

action for damages[.]”). To the extent Plaintiff contends that equitable estoppel should 

prevent Defendants from raising statutes of limitation defenses, see (Doc. 80 at 16–17), 

her argument fails. To establish equitable estoppel, Plaintiff must show: “(1) affirmative 

acts inconsistent with a claim afterwards relied upon; (2) action by a party relying on 

such conduct; and (3) injury to the party resulting from a repudiation of such conduct.” 

McBride v. Kieckhefer Assocs., Inc., 265 P.3d 1061, 1066 (Ariz. Ct. App. 2011) (citation 

omitted). Here, Plaintiff did not establish any of these elements, nor does she even argue 

that the elements are met. The Court will therefore grant Defendants’ motion for 

summary judgment on this issue. 

IV. Plaintiff’s Cross-Motion for Summary Judgment 

Plaintiff’s cross-motion for summary judgment is not actually a motion. See 

(Doc. 81). Beyond requesting that Defendants’ motion for summary judgment be denied, 

the motion does not seek further relief and appears to have been inadvertently filed as a 

cross-motion for summary judgment as it is identical to Plaintiff’s response to 

Defendants’ motion for summary judgment. Compare (Doc. 80) with (Doc. 81). In any 

event, because the Court has granted Defendants’ motion for summary judgment in its 

entirety,17 Plaintiff’s cross-motion for summary judgment will be denied. 

V. Conclusion 

For the foregoing reasons, 

 

17 Count 3 of Plaintiff’s Complaint was dismissed by a prior Order, see (Doc. 39 at 

11), and thus, all claims asserted in the Complaint have been adjudicated. 

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IT IS ORDERED that Defendants’ Motion for Summary Judgment (Doc. 78) is 

GRANTED. 

IT IS FURTHER ORDERED that Plaintiff’s Response/Cross Motion for 

Summary Judgment to Defendant’s [sic] Motion for Summary Judgment (Doc. 81) is 

DENIED. 

 IT IS FURTHER ORDERED that the June 12, 2014 Preliminary Injunction 

(Doc. 29) is hereby DISSOLVED. Defendants are no longer enjoined from conducting a 

Trustee’s Sale of the residence at 11126 Nocturne Court, Sun City, Arizona 85351. The 

bond is exonerated. 

IT IS FINALLY ORDERED that the Clerk of Court shall terminate this case and 

enter judgment in favor of Defendants and against Plaintiff accordingly. 

 Dated this 5th day of July, 2016. 

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