Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_09-cv-04025/USCOURTS-cand-5_09-cv-04025-4/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1442 Petition for Removal

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The Monroys’ pleading against the banking entities is technically a Third Party

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Complaint. However, to avoid confusion the court will refer to it as a “Cross-Complaint,” as that is the

designation used by the parties.

The holding of this court is limited to the facts and the particular circumstances

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underlying the present motion.

ORDER, page 1

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

MARIO FEDERICI, et al.,

Plaintiffs,

v.

JESSE MONROY, et al.,

Defendants.

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AND RELATED THIRD PARTY CLAIMS

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Case No.: C 09-4025 PVT

ORDER SETTING DEADLINE FOR CROSSCOMPLAINANTS JESSE AND LUPITA

MONROY TO RESPOND TO FDIC’S

SUPPLEMENTAL BRIEFING; AND

SCHEDULING FURTHER HEARING

On January 12, 2010, the parties appeared before Magistrate Judge Patricia V. Trumbull for

hearing on the motion to dismiss brought by the Cross-Defendant Federal Deposit Insurance

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Corporation (“FDIC”). After the hearing, the court twice solicited supplemental briefing to address 2

the complex issues raised by this case. In its most recent supplemental brief, the FDIC notes that

California’s “special benefit” doctrine requires the Monroys to show they have been damaged in an

Case 5:09-cv-04025-PVT Document 63 Filed 02/22/10 Page 1 of 3
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The Monroys have submitted both the “Borrower’s Estimated Settlement Statement” and 3

the “Final Statement” for the escrow for the WaMu/Federici Loan, but they submitted only the

“Borrower’s Estimated Settlement Statement” for the Federici/Benavides Loan. Thus, the Monroys have

shown that $475,000 was actually disbursed from the WaMu/Federici Loan escrow to “Fund Loan for

657 Stanford Avenue, RWC” (see Exh. B to the Lupita Monroy Decl.). But they have only shown that

it was anticipated that $457,000 would be disbursed from the Federici/Benavides Loan to New Century

Mortgage to pay off an unidentified loan (see Exh. C to the Lupita Monroy Decl.). Of note, the

Borrower’s Estimated Settlement Statement for the WaMu/Federici Loan escrow originally indicated

that $457,000 would be disbursed to New Century Mortgage to payoff a loan for the Redwood City

Property, rather than the higher amount being transferred to a new escrow for the Federici/Benavides

Loan. This significant change between the estimate and the final statement for the first loan shows that

the estimate for the second loan is not necessarily a reliable showing with regard to how the money was

ultimately distributed.

Ms. Monroy’s declaration testimony on this point is equivocal at best, and conflicts at 4

least in part with the indication in the “Borrower’s Estimated Settlement Statement” that $14,494.90 of

the loan proceeds from the Federici/Benavides Loan would be disbursed directly to her in cash. A

stronger showing of how the money was actually distributed is necessary for the court’s consideration

of whether the Monroys financially benefitted more than they were damaged by the banks’ alleged

mishandling of the transaction. Particularly in light of the fact that the Federici/Benavides Loan

occurred five months after Ms. Monroy obtained the grant deed to the Redwood City Property, and in

light of Plaintiff’s allegation (at ¶ 54.b. of his complaint), incorporated by the Monroys into their crosscomplaint (at ¶ 17), that the Monroys needed money from the loan to retain title to real property in

Menlo Park. 

ORDER, page 2

amount exceeding the $475,000 from the Washington Mutual loan to Plaintiff Federici (the

“WaMu/Federici Loan”) that was used for their benefit and/or paid out to Lupita Monroy, before any

claims they otherwise have against the banks and/or the FDIC are sufficiently “ripe” to confer

subject matter jurisdiction on this court. The court finds it appropriate to solicit a response to this

argument from the Monroys. Therefore,

IT IS HEREBY ORDERED that, no later than March 2, 2010, the Monroys shall file a

response to the FDIC’s most recent supplemental briefing (docket no. 57), along with a declaration

attaching a copy of the “Final Statement” from the escrow for the loan from Federici to Lupita Leal

Benavides (aka Lupita Monroy) (the “Federici/Benavides Loan”), which corresponds to “Borrower’s

Estimated Settlement Statement” bearing File No. 4101-2423622 (see Exh. C to the Declaration of

Lupita Monroy re Supplemental Briefing re Damages (the “Lupita Monroy Decl.”), filed herein on

February 16, 2010 at docket no. 59). Further, if that Final Statement shows the payoff of an existing 3

loan, but does not clearly identify what loan was actually paid off, the Monroys shall also submit

documentation that provides such information. 

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IT IS FURTHER ORDERED that a further hearing on this motion will be held at 10:00 a.m.

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ORDER, page 3

on March 9, 2010. 

Dated: 2/22/10

 

PATRICIA V. TRUMBULL

United States Magistrate Judge

Case 5:09-cv-04025-PVT Document 63 Filed 02/22/10 Page 3 of 3