Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_07-cv-01571/USCOURTS-cand-5_07-cv-01571-2/pdf.json

Nature of Suit Code: 443
Nature of Suit: Civil Rights Accommodations
Cause of Action: 42:405 Fair Housing Act

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United States District Court

For the Northern District of California

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*E-FILED 10/2/07*

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

MARIA GARVIN, et al., 

Plaintiffs,

 v.

LINDA TRAN, et al.,

Defendants. /

NO. C 07-01571 RS

ORDER GRANTING MOTION

TO DISMISS, WITH LEAVE TO

AMEND

I. INTRODUCTION

Plaintiffs in this action are persons of Hispanic heritage who allege that defendants engaged

in predatory lending practices to saddle plaintiffs with home mortgages they cannot afford. 

Defendants Paul Curiel and Paul Curiel Insurance Agency (collectively “Curiel”) move to dismiss,

on the grounds that the complaint fails to allege sufficient facts reflecting wrongdoing by them. The

Court finds this matter suitable for disposition without oral argument, pursuant to Civil Local Rule

7-1 (b). For the reasons set forth below, the motion will be granted, with leave to amend.

 II. BACKGROUND

The 55 page complaint in this action sets forth in great detail the factual circumstances under

which each of the plaintiffs purchased a home with financing arranged by certain of the defendants,

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For the Northern District of California

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 Indeed the level of evidentiary detail goes beyond what Rule 8 of the Federal Rules of

Civil Procedure requires, as the rule calls only for a “a short and plain statement of the claim

showing that the pleader is entitled to relief.” Because the complaint includes a claim for fraud, a

higher level of specificity is appropriate, but the complaint appears to include detail not required by

Rule 9 either.

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 Despite the high level of detail pleaded regarding the various loan transactions, it does not

appear that the complaint specifies which of the plaintiffs may have purchased insurance from

Curiel.

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and why plaintiffs believe those defendants acted improperly.1

 The allegations regarding Curiel

however, are limited to the following:

• “[M]any” of the plaintiffs unknowingly purchased insurance from Curiel as part of their

loan transactions, with no opportunity to negotiate the terms of the policies.2 Complaint ¶ 5.

• Curiel received “unearned business, commissions, and kickbacks” Complaint ¶ 7.

• Paul Curiel is “the son or other relative” of defendant Pablo Curiel, who is alleged to have

been central in the challenged transactions. Complaint ¶ 40.

• “On information and belief, Defendants Paul Curiel and Paul Curiel Insurance Agency

targeted their inferior services and products to homeowners who were Hispanic and had a national

origin from Mexico.” Complaint ¶ 377.

• “Defendants . . . have violated the Fair Housing Amendments Act by inducing Plaintiffs to

enter . . . homeowners insurance with inferior terms.” Complaint ¶ 402.

III. STANDARDS

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the legal

sufficiency of the claims alleged in the complaint. See Parks Sch. of Business v. Symington, 51 F.3d

1480, 1484 (9th Cir. 1995). Dismissal under FRCP 12(b)(6) may be based either on the “lack of a

cognizable legal theory” or on “the absence of sufficient facts alleged under a cognizable legal

theory.” Balistreri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1988). Hence, the issue on a

motion to dismiss for failure to state a claim is not whether the claimant will ultimately prevail but

whether the claimant is entitled to offer evidence to support the claims asserted. Gilligan v. Jamco

Development Corp., 108 F.3d 246, 249 (9th Cir. 1997). When evaluating such a motion, the court

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must accept all material allegations in the complaint as true and construe them in the light most

favorable to the non-moving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 340 (9th Cir. 1996). 

“[C]onclusory allegations of law and unwarranted inferences,” however, “are insufficient to defeat a

motion to dismiss for failure to state a claim.” Epstein v. Washington Energy Co., 83 F.3d 1136,

1140 (9th Cir. 1996). Additionally, the Supreme Court has recently rejected the oft-quoted

formulation of Conley v. Gibson, 355 U.S. 41, 47, (1957) that “a complaint should not be dismissed

for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts

in support of his claim which would entitle him to relief.” See Bell Atlantic Corp. v. Twombly, 127

S.Ct. 1955, 1968 (2007).

IV. DISCUSSION

Plaintiffs do not oppose the motion to dismiss with respect to the Seventh Claim for Relief

(Fraud), the Twelfth (Conspiracy), or the Fourteenth (Negligence), but request leave to amend. The

remaining claims against Curiel assert liability under various federal and state statutes. Each of the

claims assert that defendants collectively violated those statutes in numerous ways, many of which

are clearly inapplicable to Curiel. Nevertheless, the gravamen of plaintiffs’ complaint against Curiel

is clear: at least some of the plaintiffs had a portion of their loan proceeds applied to the purchase of

insurance policies from Curiel, and those arrangements were not fully and fairly disclosed to them,

as required by the various statutes. Although the lack of specific facts regarding Curiel stands out

given the detailed allegations regarding other defendants, that does not mean plaintiffs have failed to

state a claim against Curiel. Under notice pleading standards, the allegations are sufficient with the

exception that it is not possible to determine from the complaint which plaintiffs have claims against

Curiel. While Curiel presumably could determine from its own records the plaintiffs to whom it sold

insurance policies, it nonetheless is entitled to learn from the pleadings specifically who is making

claims against it. Accordingly, the motion to dismiss will be granted as to all claims for relief

alleged against Curiel, with leave to amend.

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ORDER GRANTING MOTION TO DISMISS, WITH LEAVE TO AMEND

C 07-01571 RS

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V. CONCLUSION

 The motion is granted. Plaintiffs shall file any amended complaint within 20 days of the

date of this order.

IT IS SO ORDERED.

Dated: 

RICHARD SEEBORG

United States Magistrate Judge

October 2, 2007

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ORDER GRANTING MOTION TO DISMISS, WITH LEAVE TO AMEND

C 07-01571 RS

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THIS IS TO CERTIFY THAT NOTICE OF THIS ORDER HAS BEEN GIVEN TO:

Kerstin Arusha kerstina@lawfoundation.org

Mikela Babayan mbabayan@wadesilverstein.com

William J. Goines goinesw@gtlaw.com, sandiferc@gtlaw.com

William Cornelius Last , Jr wclast@lastlawfirm.com

Mona Motwani monam@lawfoundation.org

Shawn Robert Parr shawn@parrlawgroup.com, kathy@parrlawgroup.com,

natalia@parrlawgroup.com, sujata@parrlawgroup.com

Karen Rosenthal rosenthalk@gtlaw.com, sandiferc@gtlaw.com

Leo B. Siegel k9esq@flash.net

Judi Leilani Silverstein judi@wadesilverstein.com

Michael E. Stone mikeestone@yahoo.com

Amiel Lee Wade awade@wadesilverstein.com, ccurtis@wadesilverstein.com

Counsel are responsible for distributing copies of this document to co-counsel who have not

registered for e-filing under the Court's CM/ECF program. 

Dated: 10/2/07 Chambers of Judge Richard Seeborg

By: /s/ BAK 

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