Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_13-cv-02632/USCOURTS-caed-2_13-cv-02632-12/pdf.json

Parties Involved:
Bank of America, N.A.
Defendant
James Kouretas
Plaintiff
Nationstar Mortgage Holdings, Inc.
Defendant

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

JAMES KOURETAS,

Plaintiff,

v.

NATIONSTAR MORTGAGE 

HOLDINGS, INC., and BANK OF 

AMERICA, N.A.,

Defendants.

No. 2:13-CV-02632-MCE-KJN

MEMORANDUM AND ORDER

This action proceeds on Plaintiff James Kouretas’ (“Plaintiff”) Second Amended 

Complaint (“SAC”) seeking to recover from Defendants Bank of America (“BANA”) and 

Nationstar Mortgage Holdings, Inc. (“Nationstar”) (collectively “Defendants”). On April 7, 

2014, Plaintiff filed a First Amended Complaint (“FAC”), asserting causes of action for 

breach of the implied covenant of good faith and fair dealing, wrongful foreclosure, and 

financial elder abuse in violation of state law. ECF No. 32. On Defendants’ motions, the 

Court dismissed all but one of the claims with prejudice. ECF No. 49. Plaintiff was given 

twenty days to amend the implied covenant claim to cure deficiencies noted by the 

Court. Id. at 5-7, 10. In his operative SAC, Plaintiff now asserts claims for promissory 

estoppel, violation of the unfair competition law, and Racketeer Influenced and Corrupt 

Organizations (“RICO”) violations. ECF No. 51. Presently before the Court are 

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Defendants’ Motions to Dismiss Plaintiff’s SAC pursuant to Rule 12(b)(6) (ECF Nos. 64, 

66).1 For the following reasons, Defendants’ motions are GRANTED without leave to 

amend.

2

BACKGROUND3

Plaintiff holds title to the property known as 3324 S Street, Sacramento, 

California, 95816 (“the Property”). The Property was secured by a first deed of trust in 

favor of BANA. In November 2013, Nationstar became the loan servicer. 

In May 2013, Plaintiff wrote to BANA to request a loan modification. Plaintiff was 

told in several letters from BANA staff that his loan modification application had been 

received and was being forwarded to the appropriate department. While the loan 

modification was pending, BANA served Plaintiff with a notice of default on his home 

loan. In October 2013, BANA notified Plaintiff that they were denying his loan 

modification. Then, in November 2013, Nationstar wrote to Plaintiff that BANA had 

transferred the mortgage note to them. Plaintiff claims that Nationstar made the 

following statements in its letter: “[B]ased on the information we have received from your 

previous mortgage servicer, we believe you may be experiencing a financial hardship. 

We want to help you stay in your home.” However, in December 2013, Plaintiff was 

notified that his home would be sold in a trustee’s sale approximately a week later. That

sale never took place, and Plaintiff continues to hold title to the Property. 

///

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 1 Defendants also requested that the Court take judicial notice of various documents. ECF Nos. 

65, 67. Because the Court does not rely on any of these documents in its ruling, the request is DENIED

as moot.

2 Because oral argument would not have been of material assistance, the Court ordered this 

matter submitted on the briefs. E.D. Cal. Local Rule 230(g). 

3 The following recitation of facts is taken, at times verbatim, from Plaintiff’s SAC. ECF No. 51.

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STANDARD

On a motion to dismiss for failure to state a claim under Federal Rule of Civil 

Procedure 12(b)(6),4 all allegations of material fact must be accepted as true and

construed in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. Ins.

Co., 80 F.3d 336, 337-38 (9th Cir. 1996). Rule 8(a)(2) requires only “a short and plain

statement of the claim showing that the pleader is entitled to relief” in order to “give the

defendant fair notice of what the . . . claim is and the grounds upon which it rests.” Bell

Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41,

47 (1957)). A complaint attacked by a Rule 12(b)(6) motion to dismiss does not require

detailed factual allegations. However, “a plaintiff’s obligation to provide the grounds of

his entitlement to relief requires more than labels and conclusions, and a formulaic

recitation of the elements of a cause of action will not do.” Id. (internal citations and

quotations omitted). A court is not required to accept as true a “legal conclusion

couched as a factual allegation.” Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009) 

(quoting Twombly, 550 U.S. at 555). “Factual allegations must be enough to raise a 

right to relief above the speculative level.” Twombly, 550 U.S. at 555 (citing 5 Charles 

Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1216 (3d ed. 2004) 

(stating that the pleading must contain something more than “a statement of facts that 

merely creates a suspicion [of] a legally cognizable right of action.”)).

Furthermore, “Rule 8(a)(2) . . . requires a showing, rather than a blanket

assertion, of entitlement to relief.” Twombly, 550 U.S. at 556 n.3 (internal citations and

quotations omitted). Thus, “[w]ithout some factual allegation in the complaint, it is hard

to see how a claimant could satisfy the requirements of providing not only ‘fair notice’ of

the nature of the claim, but also ‘grounds’ on which the claim rests.” Id. (citing 5 Charles

Alan Wright & Arthur R. Miller, supra, at § 1202). A pleading must contain “only enough

 4 All further references to “Rule” or “Rules” are to the Federal Rules of Civil Procedure unless 

otherwise noted.

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facts to state a claim to relief that is plausible on its face.” Id. at 570. If the “plaintiffs . . .

have not nudged their claims across the line from conceivable to plausible, their 

complaint must be dismissed.” Id. However, “[a] well-pleaded complaint may proceed

even if it strikes a savvy judge that actual proof of those facts is improbable, and ‘that a

recovery is very remote and unlikely.’” Id. at 556 (quoting Scheuer v. Rhodes, 416 U.S.

232, 236 (1974)).

A court granting a motion to dismiss a complaint must then decide whether to

grant leave to amend. Leave to amend should be “freely given” where there is no “undue 

delay, bad faith or dilatory motive on the part of the movant, . . . undue prejudice to the 

opposing party by virtue of allowance of the amendment, [or] futility of the amendment 

. . .” Foman v. Davis, 371 U.S. 178, 182 (1962); Eminence Capital, LLC v. Aspeon, Inc., 

316 F.3d 1048, 1052 (9th Cir. 2003) (listing the Foman factors as those to be considered 

when deciding whether to grant leave to amend). Not all of these factors merit equal 

weight. Rather, “the consideration of prejudice to the opposing party . . . carries the 

greatest weight.” Id. (citing DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 185 (9th Cir. 

1987)). Dismissal without leave to amend is proper only if it is clear that “the complaint 

could not be saved by any amendment.” Intri-Plex Techs. v. Crest Group, Inc., 499 F.3d 

1048, 1056 (9th Cir. 2007) (citing In re Daou Sys., Inc., 411 F.3d 1006, 1013 (9th Cir. 

2005); Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir. 1989) (“Leave 

need not be granted where the amendment of the complaint . . .

constitutes an exercise in futility . . . .”)).

ANALYSIS

A. Plaintiff Failed to Obtain Leave of the Court to Assert His New Claims

In the order that dismissed Plaintiff’s FAC, the Court granted Plaintiff leave to 

amend his claim for breach of the implied covenant of good faith and fair dealing. ECF 

No. 49 at 10. However, in his operative SAC, Plaintiff does not allege liability under a 

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theory of breach of the implied covenant of good faith and fair dealing. Instead, he 

brings two new claims—promissory estoppel and violation of the unfair competition 

law—and attempts to revive his RICO violation claim that was dismissed from his original 

complaint. 

Procedurally, all of Plaintiff’s claims are impermissible because Plaintiff failed to 

obtain leave of the Court to add these three claims against Defendants. “When the 

language of an order clearly states that a plaintiff may only amend to address certain 

deficiencies identified in the order, courts [in this circuit] have held that a plaintiff is 

barred from adding new claims or parties.” See Jameson Beach Prop. Owners Ass’n v. 

United States, No. 2:13-CV-01025-MCE-AC, 2014 WL 4925253, at *4 (E.D. Cal. 

Sept. 29, 2014) (citing Benton v. Baker Hughes, No. CV-12-07735-MMM, 2013 WL 

3353636, at *3 (C.D. Cal. June 30, 2013); DeLeon v. Wells Fargo Bank, N.A., 

No. 10-CV-01390-LHK, 2010 WL 4285006, *3 (N.D. Cal. Oct. 22, 2010)). Here, the 

Court granted Defendants’ prior motion to dismiss “with leave to amend as to Plaintiff’s 

claim for breach of the implied covenant” but “without leave to amend” as to Plaintiff’s 

other claims. ECF No. 49 at 10. Because the Court was “specific about the purpose of 

the limited leave granted,” Plaintiff’s new claims are improperly before the Court and 

should be dismissed on those procedural grounds. Id.; see also Coppola v. Smith, 

19 F. Supp. 3d 960, 971-72 (E.D. Cal. 2014) (dismissing plaintiff’s new claim because it 

exceeded the scope permitted by the prior dismissal order and because the complaint 

failed to plausibly allege the elements for the claim). 

In addition to this procedural defect, Plaintiff’s claims also fail substantively, as 

described below. 

B. First Claim: Promissory Estoppel 

In Plaintiff’s first cause of action, he claims that Defendants were required to 

consider his loan modification under the doctrine of promissory estoppel. Defendants 

argue that Plaintiff’s claim fails because he has not alleged a promise. The Court agrees.

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Under California law, a cause of action for promissory estoppel requires that 

plaintiff show “(1) a clear promise, (2) reliance, (3) substantial detriment, and 

(4) damages ‘measured by the extent of the obligation assumed and not performed.’” 

Poway Royal Mobilehome Owners Ass'n v. City of Poway, 149 Cal. App. 4th 1460, 1471, 

(2007) (quoting Toscano v. Greene Music, 124 Cal. App. 4th 685, 692 (2004)). A 

promise that is “clear and unambiguous in its terms” is an essential element of a 

promissory estoppel claim. Laks v. Coast Fed. Sav. & Loan Ass’n, 60 Cal. App. 3d 885, 

890 (1976). “[A] promise that is vague, general or of indeterminate application is not 

enforceable.” Aguilar v. Int’l Longshoremen’s Union Local No. 10, 966 F.2d 443, 446 

(9th Cir. 1992) (internal quotation marks and citation omitted).

Here, Plaintiff’s promissory estoppel claim alleges that both Defendants “promised 

to consider [Plaintiff]—in good faith—for a modification of the loan on his property.” 

SAC, ECF No. 51, at ¶ 20. Despite this assertion, Defendants’ letters do not plausibly 

show that a “clear and unambiguous” promise was made to Plaintiff. First, BANA’s

statement that it would forward, and eventually did forward, Plaintiff’s loan modification 

application to the appropriate department does not constitute a promise that the loan 

would be modified or even that the loan modification application would indeed be 

reviewed. The letters simply indicate that the loan modification application was being 

transferred. Second, Nationstar’s statements that it wanted to help Plaintiff stay in his 

home are even less clear than those of BANA’s. There are no words that specify how 

they would “help” him, or even a suggestion that they wanted to do anything other than 

be paid for the mortgage that they had just taken over. Even when viewed in the light 

most favorable to Plaintiff, the BANA and Nationstar letters do not provide any of the 

essential terms of a promise to consider Plaintiff’s loan modification. See Dooms v. 

Federal Home Loan Mortg. Corp., No. CV F 11–0352-LJO-DLB, 2011 WL 1232989, at 

*10 (E.D. Cal. Mar. 31, 2011) (dismissing a promissory estoppel claim where the

complaint lacked “facts of a clear and unambiguous promise and reasonable reliance to 

support a promissory estoppel claim”). 

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Without a clear promise, Plaintiff fails to adequately allege promissory estoppel. 

Furthermore, although this is the first time Plaintiff has alleged this particular cause of 

action, he has now had three opportunities to state a cognizable claim and, with each 

complaint, he has alleged almost identical facts. ECF No. 1 at ¶¶ 1-17; ECF No. 32 at 

¶¶ 1-17; ECF No. 27 at ¶¶ 1-17. Leave to amend is properly denied “where the movant 

presents no new facts but only new theories and provides no satisfactory explanation for 

his failure to fully develop his contentions originally.” Bonin v. Calderon, 59 F.3d 815, 

845 (9th Cir. 1995). The Court therefore finds that amendment would be futile, and 

Plaintiff’s promissory estoppel claim is DISMISSED with prejudice. 

C. Second Claim: Violation of the Unfair Competition Law

Next, Plaintiff’s second cause of action is for violation of the California Unfair 

Competition Law (“UCL”). Defendants argue that Plaintiff’s claim fails for lack of 

standing. The Court agrees. 

Section 17204 of the California Business and Professions Code limits standing to 

bring a UCL claim to specified public officials and a private person “who has suffered 

injury in fact and has lost money or property as a result of the unfair competition.” As 

such, to have standing, Plaintiff must allege facts that he suffered an economic injury 

from loss of money or property sufficient to constitute an “injury in fact.” See Perez v. 

Wells Fargo Bank, N.A., 929 F. Supp. 2d 988, 1003 (N.D. Cal. 2013); Jurewitz v. Bank of 

America, N.A., 938 F. Supp. 2d 994, 999 (S.D. Cal. 2013). In his SAC, as with his prior 

complaints, Plaintiff does not plead any facts that the foreclosure has taken place, or that 

he has incurred any additional costs created by the pending foreclosure proceedings. 

Without a financial loss of money or property, Plaintiff lacks standing to bring a UCL

claim. See id. Moreover, Plaintiff’s current and prior complaints all contain the defect of 

failing to allege a concrete economic injury. Based on this persistent failure to correct 

the original defect, the Court finds that amendment would be futile. Bonin, 59 F.3d at

845. Accordingly, Plaintiff’s UCL claim is DISMISSED with prejudice.

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D. Third Claim: Civil RICO Violations

Finally, Plaintiff alleges that Defendants violated RICO, 18 U.S.C. § 1962, in 

connection with the loan modification process and the transfer of his loan to Nationstar. 

Plaintiff also alleged this claim in his original complaint, but the Court dismissed it for 

failing to allege acts that constitute racketeering activity, failing to plead fraudulent 

actions with particularity, and failing to allege a concrete financial loss to his business or 

property. ECF No. 27 at 8-9. The Court granted Plaintiff leave to amend the claim within 

twenty days, but he failed to re-assert the RICO allegations in his FAC. Because Plaintiff 

declined to file an amended RICO claim within the appropriate time frame, Plaintiff’s 

RICO claim was dismissed with prejudice “without further notice to the parties.” Id. at 11.

Regardless, Plaintiff’s RICO claim is substantively defective because he alleges 

no new facts in the SAC to support his claim. For example, to state a RICO claim, 

Plaintiff must allege that Defendants engaged in a pattern of racketeering activity. See

18 U.S.C. § 1962; Forsyth v. Humana, Inc., 114 F.3d 1467, 1481 (9th Cir. 1997). Similar 

to his original complaint, Plaintiff fails to allege that Defendants engaged in any of the 

acts that constitute racketeering activity and merely rewords his allegations that 

Defendants engaged in activity to undermine the Homeowner Bill of Rights in California. 

SAC, ECF No. 51, at ¶ 28. The Court previously put Plaintiff on notice that “[v]iolations 

of the Homeowner Bill of Rights are not predicate offenses under RICO.” ECF No. 27 at 

8 (citing 18 U.S.C. § 1961). Because Plaintiff has failed for the second time to correct 

this defect, the Court finds that amendment of this claim would be futile. Intri-Plex 

Techs., 499 F.3d at 1160. Accordingly, Plaintiff’s RICO claim is DISMISSED with 

prejudice.

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CONCLUSION

For the reasons set forth above, Defendants’ Motions to Dismiss (ECF Nos. 64, 

66) are GRANTED without leave to amend. The Clerk of the Court is directed to close 

this case. 

IT IS SO ORDERED.

Dated: April 13, 2015

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