Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_16-cv-02228/USCOURTS-caed-2_16-cv-02228-0/pdf.json

Parties Involved:
Lewis Clinton, Jr.
Plaintiff
National Default Servicing Corporation
Defendant
Select Portfolio Servicing, Inc.
Defendant

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

LEWIS CLINTON, JR.

Plaintiff,

v.

SELECT PORTFOLIO SERVICING, INC.,

NATIONAL DEFAULT SERVICING 

CORP.

Defendants.

Case No. 2:16-cv-02228-WHO

ORDER DENYING MOTION TO 

DISMISS

INTRODUCTION

Defendants Select Portfolio Servicing, Inc. (“SPS”) and National Default Servicing 

Corporation (“NDS”) (collectively, “defendants”) move to dismiss plaintiff Lewis Clinton, Jr.’s

(“Clinton”) first cause of action for negligence, second cause of action for violation of California 

Civil Code section 2923.6(c), and fourth cause of action for violation of California Civil Code 

section 2924.10, all based on defendants’ handling of Clinton’s application for a loan modification 

for Clinton’s residence at 1169 Songwood Road, Vallejo, California, 94591 (the “Property”). The 

central issue I must decide is whether a lender has a duty of reasonable care when it processes a 

loan application. Under the facts alleged here, defendants did have such a duty and Clinton has 

plausibly pleaded his claims. Defendants’ motion to dismiss is DENIED. They shall answer 

within ten days.

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BACKGROUND

On February 15, 2005, Clinton borrowed $655,000 from lender Town and Country Credit 

Corporation and secured the transaction with a first-lien Deed of Trust (“DOT”) against the 

Property. Compl. ¶ 39 (Dkt. No. 1). In 2012, he began experiencing financial difficulties derived 

from the care and passing of his father, legal issues unrelated to this action, and his loss of 

employment. Id. ¶¶ 41, 42. He fell into default on his mortgage payments. Seeking help, he

contacted SPS, his loan servicer, for foreclosure avoidance assistance. Id. ¶ 43. 

SPS invited Clinton to apply for a loan modification and instructed him to submit several 

forms and financial records. Id. ¶ 44. It informed him that once he submitted his complete 

application, it would evaluate it and determine his eligibility for a loan modification. Id. ¶ 44. 

Clinton alleges that he submitted a complete application, with all the requested documents, in 

December of 2014. Id. ¶¶ 45, 46. 

SPS did not acknowledge that his application was complete until April 22, 2016. Id. ¶¶ 56, 

57. Between December 2014 and April 22, 2016, Clinton responded to SPS’s requests to update 

his application to cure “expired” documents when requested by SPS, but it refused to acknowledge 

his application as complete. Id. ¶ 49. Clinton continued to inquire regarding the status of his 

complete application without success. Id. ¶ 53.

On January 14, 2016, thirteen months following his initial submission, SPS and NDS, the 

trustee under the DOT, recorded a Notice of Default (“NOD”) on Clinton’s interest in the 

Property. Id. ¶ 52. SPS and NDS then recorded a Notice of Trustee’s Sale (“NOTS”) on April 

15, 2016, setting a date of sale for May 11, 2016. Id. ¶ 55. On April 22, 2016—seven days 

following the recording of the NOTS—SPS notified Clinton that his application was complete and 

he would receive a determination within thirty days. Id. ¶¶ 56, 57. SPS did not return a written 

determination of Clinton’s application for loan modification. Id. ¶ 58. A trustee’s sale was

postponed to August 15, 2016, but has not yet occurred. Id.

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LEGAL STANDARD

I. MOTION TO DISMISS

Federal Rule of Civil Procedure 8(a)(2) requires a complaint to contain “a short and plain 

statement of the claim showing that the pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2), 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) (internal quotation marks and alterations 

omitted). A motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure 

12(b)(6) tests the legal sufficiency of a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 

2001). 

“Dismissal under Rule 12(b)(6) is appropriate only where the complaint lacks a cognizable 

legal theory or sufficient facts to support a cognizable legal theory.” Mendiondo v. Centinela 

Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). While a complaint “need not contain 

detailed factual allegations” to survive a Rule 12(b)(6) motion, “it must plead enough facts to state 

a claim to relief that is plausible on its face.” Cousins v. Lockyer, 568 F.3d 1063, 1067-68 (9th 

Cir. 2009) (internal quotation marks and citations omitted). A claim is facially plausible when it 

“allows the court to draw the reasonable inference that the defendant is liable for the misconduct 

alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks omitted). 

In considering whether a claim satisfies this standard, the court must “accept factual 

allegations in the complaint as true and construe the pleadings in the light most favorable to the 

nonmoving party.” Manzarek v. St. Paul Fire & Marines Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 

2008). However, “conclusory allegations of law and unwarranted inferences are insufficient to 

avoid a Rule 12(b)(6) dismissal.” Cousins, 568 F.3d at 1067 (internal quotation marks omitted). 

“[I]t is within [the court's] wheelhouse to reject, as implausible, allegations that are too speculative 

to warrant further factual development.” Dahlia v. Rodriguez, 735 F.3d 1060, 1076 (9th Cir. 

2013).

DISCUSSION

I. NEGLIGENCE

“To state a cause of action for negligence, a plaintiff must allege (1) the defendant owed 

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the plaintiff a duty of care, (2) the defendant breached that duty, and (3) the breach proximately 

caused the plaintiff’s damages or injuries. Lueras v. BAC Home Loans Servicing, LP, 221 Cal. 

App. 4th 49, 62 (2013). Clinton argues that SPS had a duty to exercise reasonable care in the 

processing and handling of his loan modification application and that SPS breached that duty 

when it refused to properly file, organize, and account for each submitted document, causing 

damage. Compl. ¶¶ 61, 62. I agree.

A. Duty of Care

Defendants assert that Clinton’s negligence cause of action must fail because banks do not 

owe a duty of care to borrowers when acting within the scope of lending money and that SPS was 

acting in this capacity in the processing and handling of Clinton’s application for a loan 

modification. Clinton responds that a lender who invites a borrower to apply for a loan 

modification steps outside of its conventional role as a lender and owes a borrower a duty of care 

when handling and processing a submitted loan modification application. 

A bank does not owe a duty of care to a borrower “when the institution’s involvement in 

the loan transaction does not exceed the scope of its conventional role as a mere lender of money.” 

Nymark v. Heart Fed. Savings & Loan Ass’n., 231 Cal. App. 3d 1089, 1096 (1991). However, 

“[w]hether a duty of care exists is a question of law to be determined on a case-by-case basis.” 

Lueras, 221 Cal. App. 4th at 62. This depends on consideration of the six factors outlined in 

Biakanja v. Irving, 49 Cal. 2d 647 (1958)): “(1) the extent to which the transaction was intended to 

affect the plaintiff, (2) the foreseeability of harm to the plaintiff, (3) the degree of certainty that the 

plaintiff suffered injury, (4) the closeness of the connection between the defendant’s conduct and 

the injury suffered, (5) the moral blame attached to the defendant’s conduct, and (6) the policy of 

preventing future harm.” Id. (citing Biakanja v. Irving, 49 Cal. 2d 647 (1958)). 

The California Supreme Court has yet to decide whether a loan servicer owes a duty of 

care when handling an application for a loan modification; lower courts that have considered the

issue are split. See Martinez v. Flagstar Bank, 2016 WL 3906810, No. 15-cv-01934-KJM, at *7 

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(E.D. Cal. July 18, 2015).

1

 SPS relies on Lueras v. BAC Home Loans Servicing, LP to argue that 

there is no duty here. Mot. 4. In Lueras, the California Court of Appeal for the Fourth District 

found no duty where the plaintiff alleged that the lender breached its duty of care by “failing to 

timely and accurately respond to customer’s requests and inquiries, by failing to comply with state 

consumer protection laws, properly service the loan, and use consistent methods to determine 

modification approvals and by failing to ... record proper land records ... and ensure chain of title 

prior to foreclosing and to stop all foreclosure sales that are unlawful.” 221 Cal. App. 4th at 63 

(internal quotation marks omitted). The Lueras court relied on the general rule that a financial 

institution does not owe a duty of care unless the involvement exceeds the scope of a traditional 

lender. Id. at 67. It reasoned that a loan modification is the “renegotiation of loan terms, which 

falls squarely within the scope of a lending institution’s conventional role as a lender of money.” 

Id. In other words, the court found that there was no duty owed because the bank was simply 

acting in its routine business of lending money. 

The court found that there was no common law duty to offer or approve a loan 

modification under the Biakanja factors because the harm suffered by the borrower was not due to 

the denial of a loan modification but was due to the situation that placed the borrower into a 

position where the borrower could not repay the loan. Id. Thus, “no moral blame would be 

attached to the lender’s conduct.” Id. Defendants contend that since no common law duty exists 

as held in Lueras, Clinton’s negligence cause of action must fail. Mot. 5. 

In response, Clinton relies on Alvarez v. BAC Home Loans Servicing, L.P., 228 Cal. App. 

4th 941 (2014), where the California Court of Appeal for the First District concluded that a lender 

had a duty of care when processing and handling an application for a loan modification. Opp’n 5; 

see Alvarez, 228 Cal. App. 4th at 948. The Alvarez court acknowledged the general rule that the 

lender owes no duty, but concluded that a duty of care existed when the lender was reviewing a 

borrower’s application for a loan modification under the Biakanja factors. See id. at 946-51. The 

 1 The Martinez court noted,“[i]n a recent unpublished decision, the Ninth Circuit declined to 

certify the question to the California Supreme Court.” 2016 WL 3906810, at *7 n.4 (citing

Anderson v. Deutshe Bank Nat. Trust Co. Americas, 649 Fed. App’x 550 (9th Cir. May 4, 2016). 

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Honorable Kimberly Mueller recently described the reasoning of the Alvarez court when weighing 

the Biakanja factors:

[B]ecause (1) a loan modification is intended to benefit the 

borrower, (2) it is foreseeable that failures in the timeliness or 

accuracy will harm the borrower, (3) “the bank holds all the cards” 

in a loan modification process, and (4) imposing a duty of care on 

the lender would reign in ‘dual tracking,’ mitigate the lender’s 

incentives to mis- or under-inform borrowers, and further the 

California’s Legislature’s object in passing the California 

Homeowner Bill of Rights (HBOR), a residential mortgage 

borrower can state a negligence claim against a lender for breaches 

of its duty of care in processing and considering an application for a 

loan modification. 

Martinez, 2016 WL 3906810, at *7 (citing Alvarez, 228 Cal. App. 4th at 948-52). 

In Martinez, Judge Mueller followed Alvarez. I will as well.2 

Due to the particular nature of the relationship between Clinton and SPS in the loan 

modification, I find that the Biakanja factors weigh in favor of finding that SPS owed Clinton a 

common law duty to exercise reasonable care in processing Clinton’s application. The loan 

modification was intended to benefit Clinton, as he would maintain his interest in the property. 

Due to the privity of the relationship between Clinton and his loan servicer, Clinton was unable to 

seek a loan modification in other settings, so the bank here “holds all the cards.” See Alvarez, 228 

Cal. App. 4th at 949. It was foreseeable that he would be harmed as a result of a misrepresentation 

or inaccurate determination of his complete application by the loan servicer. And, imposing a 

duty upon SPS would help deter dual tracking, a practice targeted by the California Homeowners’ 

Bill of Rights as discussed later in this Order.

3

 

 2 In finding a duty here, I apply the Biakanja factors, taking into account the lender’s alleged 

conduct in refusing to admit that Clinton had submitted a complete application or to answer his 

questions whether further or different documentation was needed despite repeated telephone calls, 

and then failing to deliver its evaluation of the admittedly complete application within 30 days, as 

promised. Compl. ¶¶ 49-56. These facts distinguish this case from the unpublished Ninth Circuit 

decision in Anderson (see supra note 1), and decisions that rely on Anderson, such as Ivey v. JP 

Morgan Chase Bank, N.A., No. 16-CV-00610-HSG, 2016 WL 4502587, at *5 (N.D. Cal. Aug. 29, 

2016), and Coury v. Caliber Home Loans, Inc., No. 16-CV-05583-RS, 2016 WL 6962882, at *6 

(N.D. Cal. Nov. 29, 2016). Those cases merely determine that lenders do not owe a duty of care 

to process a borrower’s loan application within a particular time frame. See, e.g., Anderson, 649 

F. App'x at 552.

3 Dual tracking “occurs when a financial institution continues to pursue foreclosures even while 

evaluating a borrower’s loan modification application.” Foronda v. Wells Fargo Home Mortgage, 

Inc., No. 14-cv-03513-LHK, 2014 WL 6706815, at *6 (N.D. Cal. Nov. 26, 2014). 

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As in Martinez and Alvarez, I find that “a lender does owe a duty of care to a borrower not 

to make material misrepresentations about the status of an application for a loan modification and 

that a borrower would foreseeably be harmed by an inaccurate or untimely communication ... 

about the status of a loan modification application.” Martinez, 2016 WL 3906810, at *8 (citing 

Alvarez, 228 Cal App. 4th at 946-47) (internal quotation marks omitted). SPS owes Clinton a duty 

to exercise reasonable care in the handling and processing of his application. 

B. Breach of duty

Defendants further argue that even if a duty of care existed, SPS did not breach that duty. 

Mot. 5. Defendants argue that there was no breach as the “Plaintiff admits in the Complaint that 

SPS did not indicate it received a complete application until April 2016.” Id. Defendants 

overlook the heart of Clinton’s negligence cause of action—SPS refused to acknowledge a 

complete application for sixteen months. Clinton asserts:

As a direct and a proximate result of SPS’s failure to properly and 

timely file, organize, update, upload into their system, and account 

for each of Plaintiff’s submitted documents, forms and records 

submiteed [sic] pursuant to Plaintiff’s invited application for a loan 

modification, Defendant SPS was able to maintain and perpetuate 

their “back and forth games” of “missing documents” or 

“incomplete application” notices for approximately 17 [sic] months.

Compl. ¶ 63.

Weighing the allegations in the light most favorable to the nonmoving party, Clinton’s complaint 

alleges adequate facts that support a breach of the duty he was owed. 

C. Cause of alleged damages

SPS also argues that its conduct was “neither the proximate nor direct cause of any alleged 

damages.” Mot. 5. I disagree. It is foreseeable that the borrower would be harmed by a

misrepresentation or inaccurate statement regarding the application for loan modification. As the 

Alvarez court concluded, “There is a close connection between [d]efendant’s conduct and any 

injury suffered, because, to the extent [p]laintiff otherwise qualified and would have been granted 

a modification, [d]efendant’s conduct in misdirecting the papers submitted by [p]laintiff directly 

precluded the loan modification application from being timely processed.” 228 Cal. App. 4th at 

 

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948. Here, Clinton asserts that he has been harmed by being “unfairly preclude[d] the promised 

opportunity to be considered for a loan modification at a time where Plaintiff could have 

prevented further arrearage... .” Compl. ¶ 65. He claims that his credit standing lost an avoidable 

60-100 points during the 16 months he was waiting for processing of his loan modification 

application. Id. ¶ 66. He asserts that he incurred substantial avoidable costs by repeatedly faxing 

and mailing documents for his application, as well as lost time away from work. Id. ¶ 67. Clinton 

adequately alleges harm resulting from defendants’ alleged conduct. 

In sum, I conclude that Clinton has adequately pleaded (i) that SPS had a duty to exercise 

reasonable care in the processing and reviewing of Clinton’s application for a loan modification, 

(ii) that SPS breached that duty, and (iii) that Clinton’s damages were caused by SPS’s failure to 

reasonably handle and process the application. Defendants’ motion to dismiss Clinton’s 

negligence cause of action is DENIED.

II. CALIFORNIA CIVIL CODE SECTION 2923.6(c)

Clinton also asserts statutory claims under the California Homeowners’ Bill of Rights

(“HBOR”). Pursuant to California Civil Code section 2923.6(c), he alleges that SPS recorded a 

NOD and NOTS while the first loan modification application was pending. Defendants argue that 

this claim must fail because Clinton’s completed application was not pending until April 22, 2016, 

and, therefore, SPS’s recordings of the NOD on January 14, 2016 and the NOTS on April 15, 

2016 were not violations of section 2923.6(c). Mot. 6. 

Section 2923.6(c) provides:

If a borrower submits a complete application for a first lien loan 

modification offered by, or through, the borrower's mortgage 

servicer, a mortgage servicer, mortgagee, trustee, beneficiary, or 

authorized agent shall not record a notice of default or notice of 

sale, or conduct a trustee's sale, while the complete first lien loan 

modification application is pending. 

Cal. Civil Code § 2923.6(c) (emphasis added). It seeks to “prohibit deceptive and abusive home 

foreclosure practices,” such as dual tracking. Foronda v. Wells Fargo Home Mortgage, Inc., No. 

14-cv-03513-LHK, 2014 WL 6706815, at *6 (N.D. Cal. Nov. 26, 2014). Dual tracking, which 

Clinton contends happened here, “occurs when a financial institution continues to pursue 

foreclosures even while evaluating a borrower’s loan modification application.” Id. (internal 

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quotation marks and citation omitted). 

Clinton alleges that he submitted a “complete application” in December 2014. Compl. ¶ 

72. He also alleges that a NOD was recorded on January 14, 2016, id. ¶ 52, and the NOTS was 

recorded on April 22, 2016. Id. ¶ 55. Both of those dates follow Clinton’s submission of his 

allegedly complete application in December 2014.4 For purposes of pleading, I must accept 

Clinton’s allegations as true. While defendants contend there was no violation because the 

complete application was not pending until April 22, 2016, according to its records, it is 

immaterial whether SPS’s records recorded his application as complete. What matters is if the 

application was in fact complete. See Hestrin v. CitiMortgage, Inc., No. 14-cv-9836, 2015 WL 

847132, at *3 (C.D. Cal. Feb. 25, 2015) (concluding plaintiff submitted a complete application 

despite the fact that the loan servicer later informed plaintiff that his application was incomplete). 

Given Clinton’s allegations that his application was pending in December 2014 and that SPS 

“would not admit to having received a ‘complete application’ from Plaintiff,” Compl. ¶ 49, and 

its lack of responsiveness over a sixteen-month period, during which he repeatedly responded to 

requests for updated materials and requested acknowledgment of the completeness of his 

application, Clinton has plausibly alleged that SPS recorded a Notice of Default while he had a 

pending complete application for a loan modification.

Defendants’ motion to dismiss Clinton’s cause of action under section 2923.6(c) is 

DENIED. 

III.CALIFORNIA CIVIL CODE SECTION 2924.10

California Civil Code section 2924.10(a) provides:

When a borrower submits a complete first lien modification 

application or any document in connection with a first lien 

modification application, the mortgage servicer shall provide written 

acknowledgment of the receipt of the documentation within five 

business days of receipt.

Defendants move to dismiss Clinton’s cause of action under section 2924.10 because Clinton 

 4 Both parties agree that SPS recorded plaintiff’s application as complete on April 22, 2016. 

Plaintiff contends that is not an accurate date to reflect the submission of his complete application 

as the application was allegedly submitted as complete in December 2014. Opp’n 10. SPS 

contends that it was not complete until April 22, 2016. Mot. 6.

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failed to specify which documents SPS failed to acknowledge receipt of or deficiency of the 

submission. Mot. 6. Clinton maintains that because he alleged a submission date in December 

2014 and an acknowledgment of receipt by SPS on April 22, 2016, it is reasonable to infer that 

SPS failed to acknowledge receipt within five days. Opp’n 12. I agree.

In Hestrin v. CitiMortgage, Inc., the plaintiff alleged that he sent his modification 

application on July 5 but did not receive acknowledgement from defendant until 25 days later. 

2015 WL 847132, at *4. The court found that it was reasonable to assume that the defendants 

received the application more than five days prior to the date of acknowledgment. Id. Here, it is 

also reasonable to infer that SPS received Clinton’s application more than five days before April 

22, 2016, given that Clinton submitted it in December of 2014, sixteen months earlier. Compl. ¶¶ 

46, 49, 62, 65. Further, he alleges he received SPS’s notice of a complete application “without 

being required to submit any further additional or missing documents.” Compl. ¶ 56. Clinton has 

plausibly alleged a violation of section 2924.10(a). 

Defendants argue that plaintiff’s allegations are insufficient because Clinton did not 

identify the specific documents to which SPS failed to respond in a timely manner, citing Jerviss 

v. Select Portfolio Servicing, Inc., No. 15-cv-01904-MCE-KJN, 2015 WL 7572130 (E.D. Cal. 

Nov. 25, 2015). In Jerviss, the court found the plaintiff failed to state a cause of action under 

section 2924.10 because the plaintiff failed to identify to which submission the defendants failed 

to respond. Id. at *7. I find Jerviss, and the defendants’ focus on individual documentation, 

unnecessarily narrow. Here, Clinton alleges that he submitted his complete application in 

December 2014, but did not receive “written acknowledgement of the receipt of the 

documentation” until April 2016. Section 2924.10(a) requires defendants to acknowledge receipt 

of a complete application or any document in connection with a first lien modification application. 

Cal. Civ. Code § 2924.10(a); see also Penermon v. Wells Fargo Bank, N.A., 47 F. Supp. 3d 982, 

1000 (N.D. Cal. 2014). Because SPS failed to provide receipt of the alleged complete application, 

or any document, within five days of receipt following Clinton’s December 2014 submission, I 

conclude Clinton has plausibly alleged a violation. See Estrada v. Caliber Home Loans, Inc., 172 

F. Supp. 3d 1108, 1116 (C.D. Cal. 2016) (“The failure to provide receipts also constitutes a 

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violation of the statute.”)

Defendants argue that even if SPS failed to deliver acknowledgement or deficiency of the 

submission, it cured that failure as allowed under section 2924.12(c) by providing Clinton with 

written acknowledgement of a “completed application” on April 22, 2016. Mot. 7; Reply 5. 

Section 2924.12(c) provides:

(c) A mortgage servicer, mortgagee, trustee, beneficiary, or 

authorized agent shall not be liable for any violation that it has 

corrected and remedied prior to the recordation of a trustee's deed 

upon sale, or that has been corrected and remedied by third parties 

working on its behalf prior to the recordation of a trustee's deed 

upon sale.

Cal. Civil Code § 2924.12(c) (emphasis added). Defendants again rely on Jerviss to argue that 

they cured any alleged violation of 2924.10. But the defendants in Jerviss “contend[ed] that they 

ha[d] corrected and remedied any purported violation of section 2924.10 by postponing the 

trustee's sale and denying Plaintiffs’ complete application for a loan modification.” 2015 WL 

7572130, at *7 (emphasis added). In addition to dismissing the section 2924.10 claim for failing 

to identify the specific submissions to which the defendant allegedly did not respond, the Jerviss

court found that the defendant had sufficiently cured the violation of section 2924.10 when it 

postponed the trustee’s sale, acknowledged receipt of the complete application, and denied the 

application. 2015 WL 7572130, at *7. 

I already found the Jerviss court’s interpretation of section 2924.10 overly narrow. Also, it 

is not clear to me why the acts of (1) postponing the trustee’s sale, (2) acknowledging receipt of 

the complete application, and (3) denying the application, necessarily amount to “correct[ing] and 

remed[ying]” a statutory requirement to provide written acknowledgement of receipt within five 

days of receipt. Id. I am not persuaded that SPS’s written notification of receiving a complete 

application as of April 22, 2016 sufficiently cures any violation of section 2924.10. 

Regardless of whether defendants “corrected and remedied” the violation as defendants 

contend they have, I take the allegations in Clinton’s complaint as true when determining whether 

Clinton has plausibly alleged a violation of section 2924.10. In Jones v. Aegis Wholesale Corp., 

the court found that plaintiffs alleged a violation of section 2924.10 where the plaintiffs alleged 

simply the submission of a completed application to defendant and defendant “did not provide 

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written acknowledgment within five business days of receipt of [the application.]” No. 15-cv01134-JAM-CKD, 2015 WL 9260837, at *4 (E.D. Cal. Dec. 18, 2015). Here, the Complaint 

states that Clinton submitted a complete application in December 2014 and did not receive 

acknowledgment until April 22, 2016. Compl. ¶¶ 46, 56. At the pleading stage, Clinton has 

plausibly alleged a violation of section 2924.10. Defendants’ motion to dismiss is DENIED. 

CONCLUSION

Clinton has sufficiently pleaded causes of action for negligence, violation of Cal. Civil 

Code section 2923.6(c), and violation Cal. Civil Code section 2924.10. Defendants’ motion to 

dismiss is DENIED. They shall answer on or before December 12, 2016.

IT IS SO ORDERED.

Dated: December 1, 2016

______________________________________

WILLIAM H. ORRICK

United States District Judge

Case 2:16-cv-02228-WHO Document 12 Filed 12/02/16 Page 12 of 12