Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_18-cv-01297/USCOURTS-casd-3_18-cv-01297-1/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 28:1343 Violation of Civil Rights

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3:18-cv-1297-WQH-AGS

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

DASHA RILEY,

Plaintiff,

v.

QUALITY LOAN SERVICE CORP.;

SPECIALIZED LOAN SERVICING, 

LLC; and MORTGAGE INVESTORS 

GROUP, INC.

Defendants.

No. 3:18-cv-1297-WQH-AGS

ORDER 

HAYES, Judge: 

The matters before the Court are the Motions to Dismiss filed by Defendant

Quality Loan Service Corporation (Quality) (ECF No. 7) and Specialized Loan 

Servicing, LLC (Specialized) (ECF No. 19).

I. Background

On June 15, 2018, Plaintiff initiated an action against Defendants in this Court 

by filing a Complaint. (ECF No. 1). On July 23, 2018, Defendant Quality filed a 

Motion to Dismiss Plaintiff’s Complaint for lack of subject matter jurisdiction and 

failure to state a cause of action. (ECF No. 7). On August 13, 2018, Plaintiff filed 

Opposition. (ECF No. 9). On August 17, 2018, Defendant filed a Reply. (ECF No. 

10). On November 23, 2018, Defendant Specialized filed a Motion to Dismiss 

Complaint for Lack of Standing. (ECF No. 19). Plaintiff did not file opposition or 

notice of non-opposition. 

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II. Allegations of the Complaint 

On May 8, 2018, Jeff and Barbara Lubin were served a notice of trustee sale 

by Defendant Quality. (ECF No. 1 ¶ 14). On May 30, 2018, a trustee sale was held 

for the residential property located at 2643 Hidden Valley Rd., La Jolla, California, 

92037 (“Hidden Valley Rd. Property”). Id. ¶¶ 2, 16. The property was sold at a

May 30, 2018 public auction. Id. ¶ 16. Defendants Quality Loan Service 

Corporation, Specialized Loan Servicing, LLC, and Mortgage Investors Group, Inc. 

were involved in conducting the sale. Id. ¶ 9–11. 

Plaintiff Dasha Riley, proceeding pro se, “operates a private business and is 

involved in real estate transactions as a consultant and also as an investor.” Id. ¶ 13. 

Plaintiff “learned of the concerns of Jeff and Barbara Lubin regarding their home” 

and on June 11, 2018 “acquired the interests of the subject real property through an 

assignment of rights.” Id. 

Plaintiff alleges Defendants conducted an “illegal sale of property” because 

Defendants “did not have a license or permit authorizing them to conduct a sale of 

real property at the date and time of the sale [of the Hidden Valley Rd. Property] . . 

. .” Id. ¶ 24–27. Plaintiff brings claims against all Defendants for: (1) civil 

conspiracy to commit wire fraud in violation of 18 U.S.C. § 1343; (2) to set aside 

trustee sale; and (3) constructive fraud. 

III. Motions to Dismiss1

Defendant Specialized contends that “Plaintiff's jurisdictional analysis is 

fatally flawed. Plaintiff relies upon a federal criminal statute (18 U.S.C. §1343, 

“Fraud by wire, radio, or television”) to establish federal question jurisdiction. This 

statute does not create a private right of action and therefore cannot support the 

exercise of federal question jurisdiction under 28 U.S.C. §1331. Dismissal is 

therefore appropriate under FRCP 12(b)(1).” (ECF No. 19-1 at 6). 

 

1 The Court finds that Defendant Specialized’s jurisdictional argument is dispositive of this action. For this reason, 

the Court declines to address the remainder of Specialized’s contentions or any of the contentions in favor of 

dismissal made by Defendant Quality in ECF No. 7. 

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Plaintiff’s opposition to Defendant Specialized’s Motion to Dismiss was due 

by December 17, 2018. (ECF No. 20). As of December 28, 2018, Plaintiff has not 

filed opposition or a notice of non-opposition.

IV. Legal Standard

“Federal courts are courts of limited jurisdiction. They possess only that 

power authorized by Constitution and statute, which is not to be expanded by 

judicial decree. It is to be presumed that a cause lies outside this limited jurisdiction, 

and the burden of establishing the contrary rests upon the party asserting 

jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994) 

(citations omitted). Federal Rule of Civil Procedure 12(b)(1) permits a court to 

dismiss a claim for “lack of subject-matter jurisdiction.” Fed. R. Civ. P. 12(b)(1). 

Federal Rule of Civil Procedure 12(b)(6) permits dismissal for “failure to state a 

claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). “A district court’s 

dismissal for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) 

is proper if there is a ‘lack of a cognizable legal theory or the absence of sufficient 

facts alleged under a cognizable legal theory.’” Conservation Force v. Salazar, 646 

F.3d 1240, 1242 (9th Cir. 2011) (quoting Balistreri v. Pacifica Police Dep’t, 901 

F.2d 696, 699 (9th Cir. 1988)).

V. Discussion

a. Plaintiff’s Federal Claim 

Plaintiff’s complaint states, “This Court has federal jurisdiction because this 

case arises out of a violation of federal law. 18 U.S.C. § 1343.” (ECF No. 1 at 2). 

Defendant contends that Plaintiff has failed to state a claim for civil conspiracy to 

commit wire fraud in violation of 18 U.S.C. § 1343. This Court’s jurisdiction to 

hear this matter rests entirely on the existence of a federal question, so the Court 

addresses this question first.

In order for Plaintiff to allege a claim under a federal statute, the statute must 

provide for a private right of action. See Touche Ross & Co. v. Redington, 442 U.S. 

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560, 568 (1979) (“As we recently have emphasized, ‘the fact that a federal statute 

has been violated and some person harmed does not automatically give rise to a 

private cause of action in favor of that person.’”) (citing Cannon v. Univ. of Chicago, 

441 U.S. 677, 688 (1979)). 18 U.S.C. § 1343 is the federal criminal wire fraud 

statute. The Court must determine whether Congress intended to create a private 

right of action under 18 U.S.C. § 1343.

2 The statute states:

Whoever, having devised or intending to devise any scheme or 

artifice to defraud, or for obtaining money or property by means of

false or fraudulent pretenses, representations, or promises, transmits 

or causes to be transmitted by means of wire, radio, or television 

communication in interstate or foreign commerce, any writings, signs, 

signals, pictures, or sounds for the purpose of executing such scheme 

or artifice, shall be fined under this title or imprisoned not more than 

20 years, or both. If the violation occurs in relation to, or involving 

any benefit authorized, transported, transmitted, transferred, 

disbursed, or paid in connection with, a presidentially declared major 

disaster or emergency (as those terms are defined in section 102 of the 

Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 

U.S.C. 5122)), or affects a financial institution, such person shall be 

fined not more than $1,000,000 or imprisoned not more than 30 years, 

or both.

§ 1343. The Court finds that the statute does not evince an intent by Congress to 

create a private right of action. This finding is consistent with numerous courts in 

this circuit, as well as other circuits who have addressed this issue. See Chen v. T.T. 

Group, 2014 WL 12613519 (C.D. Cal. May 29, 2014) (“18 U.S.C. §§ 1341 and 1343 

are criminal wire fraud statutes. They do not create civil causes of action, nor do 

they give this Court permission to hear state contract claims”); Soliven v. Yamashiro, 

2014 WL 2938401 (D. Haw. June 30, 2014) (same); Small v. Mortgage Elec. 

 

2 Wire fraud in violation of 18 U.S.C. § 1343 can serve as a predicate offense in a civil RICO 

action under 18 U.S.C. §§ 1962 and 1964. To maintain a RICO claim under 18 U.S.C. § 

1962(c), however, a plaintiff must allege (1) conduct (2) of an enterprise (3) through a pattern 

(4) of racketeering activity. See Rezner v. Bayerische Hypo–Und Vereinsbank AG, 630 F.3d 

866, 873 (9th Cir. 2010). In this case, Plaintiff has neither alleged a violation of 18 U.S.C. §§ 

1962 or 1964, nor alleged facts sufficient to state a RICO claim. 

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Registration Sys., Inc., 2010 WL 3719314 (E.D. Cal. Sept. 16, 2010) (same); Napper 

v. Anderson, 500 F.2d 634, 636 (5th Cir. 1974) (same); Wisdom v. First Midwest 

Bank, 167 F.3d 402, 408 (8th Cir. 1999) (same). Accordingly, Plaintiff has failed 

to state a claim under 18 U.S.C. § 1343 upon which relief can be granted. Plaintiff’s 

civil conspiracy to commit wire fraud claim is dismissed with prejudice.3

b. Jurisdiction Over Remaining Claims

Once all claims over which a federal court has original jurisdiction have been 

dismissed, the court in its discretion may decline to exercise supplemental 

jurisdiction over any remaining state law claims. 28 U.S.C. § 1367(c)(3). Plaintiff’s 

remaining claims arise out of alleged irregularities in a foreclosure conducted 

pursuant to California’s nonjudicial foreclosure scheme, codified at California Civil 

Code section 2920 et seq. This Court finds Plaintiff’s remaining claims better suited 

for a state court, and declines to exercise its supplemental jurisdiction over 

Plaintiff’s remaining claims. See United Mine Workers of Am. v. Gibbs, 383 U.S. 

715, 726 (1966) (“Needless decisions of state law should be avoided both as a matter 

of comity and to promote justice between the parties, by procuring for them a surerfooted reading of applicable law.”). Plaintiff’s remaining claims are dismissed 

without prejudice.

VI. Conclusion

IT IS HEREBY ORDERED that the Motion to Dismiss filed by Defendant 

Specialized (ECF No. 19) is GRANTED. Plaintiff’s civil conspiracy claim under 

18 U.S.C. § 1343 is dismissed with prejudice. The Court declines to exercise 

supplemental jurisdiction over Plaintiff’s remaining state law claims, and dismisses 

those claims without prejudice. IT IS FURTHER ORDERED that the Motion to 

 

3 The Court has considered Plaintiff’s pro se status. Haines v. Kerner, 404 U.S. 519, 520–21 

(1972) (Pro se pleadings are held to a less stringent standard than those drafted by lawyers). 

Although a pro se plaintiff is normally entitled to notice and an opportunity to amend before 

dismissal, it is clear in this instance that no amendment can cure the defects of a claim stated 

under a statute that does not provide a private right of action. See Lopez v. Smith, 203 F.3d 

1122, 1129 (9th Cir. 2000) (“Under Ninth Circuit case law, district courts are only required to 

grant leave to amend if a complaint can possibly be saved.”).

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Dismiss filed by Defendant Quality (ECF No. 7) is DENIED as moot. The Clerk of 

Court shall close the case. 

Dated: January 10, 2019

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