Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_06-cv-07444/USCOURTS-cand-4_06-cv-07444-0/pdf.json

Parties Involved:
Alphonso Jackson
Defendant
San Francisco Care Center
Plaintiff

Document Text:

United States District Court

For the Northern District of California

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On December 6, 2006, HUD accepted sealed bids for the note on

SFCC's property. Pursuant to an agreement between the parties, HUD

will not award the sale of the note to the highest bidder until

Tuesday, December 12, 2006. 

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO CARE CENTER, a

California Limited Partnership,

Plaintiff,

v.

ALPHONSO JACKSON, in his capacity as

Secretary of the United States

Department of Housing and Urban

Development,

Defendant.

 /

No. C 06-7444 CW

ORDER DENYING

PLAINTIFF'S

MOTION FOR A

TEMPORARY

RESTRAINING ORDER

Plaintiff San Francisco Care Center (SFCC), a California

Limited Partnership that owns and operates an assisted living

facility, has filed an ex parte application for a temporary

restraining order, seeking to prevent Defendant the Department of

Housing and Urban Development (HUD) from selling the mortgage on

Plaintiff's property.1 Defendant opposes the application. Having

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 1 of 20
United States District Court

For the Northern District of California

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considered the parties' papers, the Court DENIES Plaintiff's

application for a temporary restraining order. 

BACKGROUND

In June, 2002, SFCC borrowed money from a private lender to

purchase the property and to build an assisted living facility. 

HUD insured the loan pursuant to its Nursing Home Program, Title 

12 U.S.C. § 1715w. Construction of the facility began in July,

2002. Plaintiff alleges that HUD "actively interfered with and

negatively impacted the construction process." Complaint at 1. 

Construction was completed and the facility is now occupied by

senior citizens. However, Plaintiff alleges that only two-thirds

of the facility is habitable because of construction defects. Its

action against the construction company for those defects is set

for trial in San Francisco Superior Court on May, 2007. 

Beginning in 2005, the lender began increasing the amount

Plaintiff needed to deposit into escrow to cover increased taxes,

which Plaintiff disputed. The amount varied from month to month,

and Plaintiff disputed the amount several times. Plaintiff refused

to pay one amount in November, 2005 and another in April, 2006. 

Although Plaintiff did not pay the additional amount, it paid the

remainder of its obligation on the loan. After Plaintiff refused

to pay the April, 2006, $25,000 amount into escrow and HUD refused

to waive Plaintiff's obligation, the lender informed Plaintiff that

the loan was in default and would be assigned to HUD. HUD accepted

the assignment of the loan on May 24, 2006. 

SFCC alleges that at the time the loan was assigned to HUD, it

"had paid all amounts actually assessed by the City and County of

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 2 of 20
United States District Court

For the Northern District of California

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San Francisco for the property, so there was no delinquency in the

actual tax assessment." Reply at 3-4. Rather, the delinquency was

based on the lender's valuation of the newly constructed building

and estimated tax increase. Plaintiff alleges that the lender

never communicated the increased valuation to it. Since the loan

has been assigned to HUD, Plaintiff has not made any payments. 

However, payments have been taken from Plaintiff's Reserve for

Replacement account. 

Plaintiff alleges that "the assessment of an[] additional

$25,000 for taxes was improper and was not a legitimate basis on

which to declare a default in the Note and Deed of Trust and

trigger an assignment of the Note and Deed of Trust to HUD." Reply

at 5. Therefore, Plaintiff argues that HUD's decision to accept

the assignment of the loan "was arbitrary and capricious because it

was not based on any legitimate 'default' but rather on a default

which had been fabricated by the Lender." Id. 

HUD accepted sealed bids on the note and deed of trust on

Friday, December 6, 2006, and will accept the highest bid on

Tuesday, December 11, 2006, absent a TRO. Plaintiff argues that it

will suffer irreparable harm if Defendant is allowed to sell the

loan, based in part on its allegation that several of those who

have visited the facility in anticipation of bidding on the loan

have stated that they intend to foreclose the loan and take over

operation of the facility. 

LEGAL STANDARD

A temporary restraining order may be issued only if 

"immediate and irreparable injury, loss, or damage will result to

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 3 of 20
United States District Court

For the Northern District of California

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the applicant" if the order does not issue. Fed. R. Civ. P. 65(b). 

To obtain a temporary retraining order, Plaintiff must establish

either: (1) a combination of probable success on the merits and the

possibility of irreparable harm, or (2) that serious questions

regarding the merits exist and the balance of hardships tips

sharply in its favor. See Baby Tam & Co. v. City of Las Vegas, 154

F.3d 1097, 1100 (9th Cir. 1998); Rodeo Collection, Ltd. v. West

Seventh, 812 F.2d 1215, 1217 (9th Cir. 1987).

DISCUSSION

Putting aside the question of Plaintiff's likelihood of

success on the merits, Plaintiff has not demonstrated any

irreparable harm that will come from the assignment of the loan. 

Plaintiff argues that if the loan is sold and if the party that

purchases the loan acts to foreclose the loan and to take over

operation of the facility, it "will result in a major monetary loss

for SFCC and the loss of a project which has taken years to develop

and which now serves San Francisco's senior citizens in need of

assisted living facilities." Reply at 9. However, the Ninth

Circuit has held that "[m]ere financial injury . . . will not

constitute irreparable harm if adequate compensatory relief will be

available in the course of litigation." Goldie's Bookstore, Inc.

v. Superior Court, 239 F.2d 466, 471 (9th Cir. 1984) (citations

omitted). 

Plaintiff's interest in the property is commercial. Further,

Plaintiff has itself described the result of a sale as a "major

monetary loss." The Court finds that adequate compensatory relief

will be available to Plaintiff if it proceeds against HUD in

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 4 of 20
United States District Court

For the Northern District of California

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litigation and ultimately prevails. Further, Plaintiff's alleged

injury is based on its unsubstantiated belief that the entity that

purchases the loan will indeed foreclose on the loan and attempt to

take over the property. If this does happen, Plaintiff will have

an opportunity to attempt to recover compensatory damage for its

losses, and the residents of the facility will be able to continue

to live there under the new management. 

CONCLUSION

For the foregoing reasons, the Court DENIES Plaintiff's motion

for a temporary restraining order, without prejudice to Plaintiff

filing a noticed motion for a preliminary injunction if

appropriate. 

IT IS SO ORDERED.

Dated: 12/11/06 

CLAUDIA WILKEN

United States District Judge

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 5 of 20
United States District Court

For the Northern District of California

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On December 6, 2006, HUD accepted sealed bids for the note on

SFCC's property. Pursuant to an agreement between the parties, HUD

will not award the sale of the note to the highest bidder until

Tuesday, December 12, 2006. 

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO CARE CENTER, a

California Limited Partnership,

Plaintiff,

v.

ALPHONSO JACKSON, in his capacity as

Secretary of the United States

Department of Housing and Urban

Development,

Defendant.

 /

No. C 06-7444 CW

ORDER DENYING

PLAINTIFF'S

MOTION FOR A

TEMPORARY

RESTRAINING ORDER

Plaintiff San Francisco Care Center (SFCC), a California

Limited Partnership that owns and operates an assisted living

facility, has filed an ex parte application for a temporary

restraining order, seeking to prevent Defendant the Department of

Housing and Urban Development (HUD) from selling the mortgage on

Plaintiff's property.1 Defendant opposes the application. Having

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 6 of 20
United States District Court

For the Northern District of California

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considered the parties' papers, the Court DENIES Plaintiff's

application for a temporary restraining order. 

BACKGROUND

In June, 2002, SFCC borrowed money from a private lender to

purchase the property and to build an assisted living facility. 

HUD insured the loan pursuant to its Nursing Home Program, Title 

12 U.S.C. § 1715w. Construction of the facility began in July,

2002. Plaintiff alleges that HUD "actively interfered with and

negatively impacted the construction process." Complaint at 1. 

Construction was completed and the facility is now occupied by

senior citizens. However, Plaintiff alleges that only two-thirds

of the facility is habitable because of construction defects. Its

action against the construction company for those defects is set

for trial in San Francisco Superior Court on May, 2007. 

Beginning in 2005, the lender began increasing the amount

Plaintiff needed to deposit into escrow to cover increased taxes,

which Plaintiff disputed. The amount varied from month to month,

and Plaintiff disputed the amount several times. Plaintiff refused

to pay one amount in November, 2005 and another in April, 2006. 

Although Plaintiff did not pay the additional amount, it paid the

remainder of its obligation on the loan. After Plaintiff refused

to pay the April, 2006, $25,000 amount into escrow and HUD refused

to waive Plaintiff's obligation, the lender informed Plaintiff that

the loan was in default and would be assigned to HUD. HUD accepted

the assignment of the loan on May 24, 2006. 

SFCC alleges that at the time the loan was assigned to HUD, it

"had paid all amounts actually assessed by the City and County of

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 7 of 20
United States District Court

For the Northern District of California

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San Francisco for the property, so there was no delinquency in the

actual tax assessment." Reply at 3-4. Rather, the delinquency was

based on the lender's valuation of the newly constructed building

and estimated tax increase. Plaintiff alleges that the lender

never communicated the increased valuation to it. Since the loan

has been assigned to HUD, Plaintiff has not made any payments. 

However, payments have been taken from Plaintiff's Reserve for

Replacement account. 

Plaintiff alleges that "the assessment of an[] additional

$25,000 for taxes was improper and was not a legitimate basis on

which to declare a default in the Note and Deed of Trust and

trigger an assignment of the Note and Deed of Trust to HUD." Reply

at 5. Therefore, Plaintiff argues that HUD's decision to accept

the assignment of the loan "was arbitrary and capricious because it

was not based on any legitimate 'default' but rather on a default

which had been fabricated by the Lender." Id. 

HUD accepted sealed bids on the note and deed of trust on

Friday, December 6, 2006, and will accept the highest bid on

Tuesday, December 11, 2006, absent a TRO. Plaintiff argues that it

will suffer irreparable harm if Defendant is allowed to sell the

loan, based in part on its allegation that several of those who

have visited the facility in anticipation of bidding on the loan

have stated that they intend to foreclose the loan and take over

operation of the facility. 

LEGAL STANDARD

A temporary restraining order may be issued only if 

"immediate and irreparable injury, loss, or damage will result to

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 8 of 20
United States District Court

For the Northern District of California

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the applicant" if the order does not issue. Fed. R. Civ. P. 65(b). 

To obtain a temporary retraining order, Plaintiff must establish

either: (1) a combination of probable success on the merits and the

possibility of irreparable harm, or (2) that serious questions

regarding the merits exist and the balance of hardships tips

sharply in its favor. See Baby Tam & Co. v. City of Las Vegas, 154

F.3d 1097, 1100 (9th Cir. 1998); Rodeo Collection, Ltd. v. West

Seventh, 812 F.2d 1215, 1217 (9th Cir. 1987).

DISCUSSION

Putting aside the question of Plaintiff's likelihood of

success on the merits, Plaintiff has not demonstrated any

irreparable harm that will come from the assignment of the loan. 

Plaintiff argues that if the loan is sold and if the party that

purchases the loan acts to foreclose the loan and to take over

operation of the facility, it "will result in a major monetary loss

for SFCC and the loss of a project which has taken years to develop

and which now serves San Francisco's senior citizens in need of

assisted living facilities." Reply at 9. However, the Ninth

Circuit has held that "[m]ere financial injury . . . will not

constitute irreparable harm if adequate compensatory relief will be

available in the course of litigation." Goldie's Bookstore, Inc.

v. Superior Court, 239 F.2d 466, 471 (9th Cir. 1984) (citations

omitted). 

Plaintiff's interest in the property is commercial. Further,

Plaintiff has itself described the result of a sale as a "major

monetary loss." The Court finds that adequate compensatory relief

will be available to Plaintiff if it proceeds against HUD in

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 9 of 20
United States District Court

For the Northern District of California

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litigation and ultimately prevails. Further, Plaintiff's alleged

injury is based on its unsubstantiated belief that the entity that

purchases the loan will indeed foreclose on the loan and attempt to

take over the property. If this does happen, Plaintiff will have

an opportunity to attempt to recover compensatory damage for its

losses, and the residents of the facility will be able to continue

to live there under the new management. 

CONCLUSION

For the foregoing reasons, the Court DENIES Plaintiff's motion

for a temporary restraining order, without prejudice to Plaintiff

filing a noticed motion for a preliminary injunction if

appropriate. 

IT IS SO ORDERED.

Dated: 12/11/06 

CLAUDIA WILKEN

United States District Judge

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 10 of 20
United States District Court

For the Northern District of California

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On December 6, 2006, HUD accepted sealed bids for the note on

SFCC's property. Pursuant to an agreement between the parties, HUD

will not award the sale of the note to the highest bidder until

Tuesday, December 12, 2006. 

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO CARE CENTER, a

California Limited Partnership,

Plaintiff,

v.

ALPHONSO JACKSON, in his capacity as

Secretary of the United States

Department of Housing and Urban

Development,

Defendant.

 /

No. C 06-7444 CW

ORDER DENYING

PLAINTIFF'S

MOTION FOR A

TEMPORARY

RESTRAINING ORDER

Plaintiff San Francisco Care Center (SFCC), a California

Limited Partnership that owns and operates an assisted living

facility, has filed an ex parte application for a temporary

restraining order, seeking to prevent Defendant the Department of

Housing and Urban Development (HUD) from selling the mortgage on

Plaintiff's property.1 Defendant opposes the application. Having

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 11 of 20
United States District Court

For the Northern District of California

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considered the parties' papers, the Court DENIES Plaintiff's

application for a temporary restraining order. 

BACKGROUND

In June, 2002, SFCC borrowed money from a private lender to

purchase the property and to build an assisted living facility. 

HUD insured the loan pursuant to its Nursing Home Program, Title 

12 U.S.C. § 1715w. Construction of the facility began in July,

2002. Plaintiff alleges that HUD "actively interfered with and

negatively impacted the construction process." Complaint at 1. 

Construction was completed and the facility is now occupied by

senior citizens. However, Plaintiff alleges that only two-thirds

of the facility is habitable because of construction defects. Its

action against the construction company for those defects is set

for trial in San Francisco Superior Court on May, 2007. 

Beginning in 2005, the lender began increasing the amount

Plaintiff needed to deposit into escrow to cover increased taxes,

which Plaintiff disputed. The amount varied from month to month,

and Plaintiff disputed the amount several times. Plaintiff refused

to pay one amount in November, 2005 and another in April, 2006. 

Although Plaintiff did not pay the additional amount, it paid the

remainder of its obligation on the loan. After Plaintiff refused

to pay the April, 2006, $25,000 amount into escrow and HUD refused

to waive Plaintiff's obligation, the lender informed Plaintiff that

the loan was in default and would be assigned to HUD. HUD accepted

the assignment of the loan on May 24, 2006. 

SFCC alleges that at the time the loan was assigned to HUD, it

"had paid all amounts actually assessed by the City and County of

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 12 of 20
United States District Court

For the Northern District of California

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San Francisco for the property, so there was no delinquency in the

actual tax assessment." Reply at 3-4. Rather, the delinquency was

based on the lender's valuation of the newly constructed building

and estimated tax increase. Plaintiff alleges that the lender

never communicated the increased valuation to it. Since the loan

has been assigned to HUD, Plaintiff has not made any payments. 

However, payments have been taken from Plaintiff's Reserve for

Replacement account. 

Plaintiff alleges that "the assessment of an[] additional

$25,000 for taxes was improper and was not a legitimate basis on

which to declare a default in the Note and Deed of Trust and

trigger an assignment of the Note and Deed of Trust to HUD." Reply

at 5. Therefore, Plaintiff argues that HUD's decision to accept

the assignment of the loan "was arbitrary and capricious because it

was not based on any legitimate 'default' but rather on a default

which had been fabricated by the Lender." Id. 

HUD accepted sealed bids on the note and deed of trust on

Friday, December 6, 2006, and will accept the highest bid on

Tuesday, December 11, 2006, absent a TRO. Plaintiff argues that it

will suffer irreparable harm if Defendant is allowed to sell the

loan, based in part on its allegation that several of those who

have visited the facility in anticipation of bidding on the loan

have stated that they intend to foreclose the loan and take over

operation of the facility. 

LEGAL STANDARD

A temporary restraining order may be issued only if 

"immediate and irreparable injury, loss, or damage will result to

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 13 of 20
United States District Court

For the Northern District of California

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the applicant" if the order does not issue. Fed. R. Civ. P. 65(b). 

To obtain a temporary retraining order, Plaintiff must establish

either: (1) a combination of probable success on the merits and the

possibility of irreparable harm, or (2) that serious questions

regarding the merits exist and the balance of hardships tips

sharply in its favor. See Baby Tam & Co. v. City of Las Vegas, 154

F.3d 1097, 1100 (9th Cir. 1998); Rodeo Collection, Ltd. v. West

Seventh, 812 F.2d 1215, 1217 (9th Cir. 1987).

DISCUSSION

Putting aside the question of Plaintiff's likelihood of

success on the merits, Plaintiff has not demonstrated any

irreparable harm that will come from the assignment of the loan. 

Plaintiff argues that if the loan is sold and if the party that

purchases the loan acts to foreclose the loan and to take over

operation of the facility, it "will result in a major monetary loss

for SFCC and the loss of a project which has taken years to develop

and which now serves San Francisco's senior citizens in need of

assisted living facilities." Reply at 9. However, the Ninth

Circuit has held that "[m]ere financial injury . . . will not

constitute irreparable harm if adequate compensatory relief will be

available in the course of litigation." Goldie's Bookstore, Inc.

v. Superior Court, 239 F.2d 466, 471 (9th Cir. 1984) (citations

omitted). 

Plaintiff's interest in the property is commercial. Further,

Plaintiff has itself described the result of a sale as a "major

monetary loss." The Court finds that adequate compensatory relief

will be available to Plaintiff if it proceeds against HUD in

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 14 of 20
United States District Court

For the Northern District of California

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litigation and ultimately prevails. Further, Plaintiff's alleged

injury is based on its unsubstantiated belief that the entity that

purchases the loan will indeed foreclose on the loan and attempt to

take over the property. If this does happen, Plaintiff will have

an opportunity to attempt to recover compensatory damage for its

losses, and the residents of the facility will be able to continue

to live there under the new management. 

CONCLUSION

For the foregoing reasons, the Court DENIES Plaintiff's motion

for a temporary restraining order, without prejudice to Plaintiff

filing a noticed motion for a preliminary injunction if

appropriate. 

IT IS SO ORDERED.

Dated: 12/11/06 

CLAUDIA WILKEN

United States District Judge

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 15 of 20
United States District Court

For the Northern District of California

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On December 6, 2006, HUD accepted sealed bids for the note on

SFCC's property. Pursuant to an agreement between the parties, HUD

will not award the sale of the note to the highest bidder until

Tuesday, December 12, 2006. 

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO CARE CENTER, a

California Limited Partnership,

Plaintiff,

v.

ALPHONSO JACKSON, in his capacity as

Secretary of the United States

Department of Housing and Urban

Development,

Defendant.

 /

No. C 06-7444 CW

ORDER DENYING

PLAINTIFF'S

MOTION FOR A

TEMPORARY

RESTRAINING ORDER

Plaintiff San Francisco Care Center (SFCC), a California

Limited Partnership that owns and operates an assisted living

facility, has filed an ex parte application for a temporary

restraining order, seeking to prevent Defendant the Department of

Housing and Urban Development (HUD) from selling the mortgage on

Plaintiff's property.1 Defendant opposes the application. Having

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 16 of 20
United States District Court

For the Northern District of California

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considered the parties' papers, the Court DENIES Plaintiff's

application for a temporary restraining order. 

BACKGROUND

In June, 2002, SFCC borrowed money from a private lender to

purchase the property and to build an assisted living facility. 

HUD insured the loan pursuant to its Nursing Home Program, Title 

12 U.S.C. § 1715w. Construction of the facility began in July,

2002. Plaintiff alleges that HUD "actively interfered with and

negatively impacted the construction process." Complaint at 1. 

Construction was completed and the facility is now occupied by

senior citizens. However, Plaintiff alleges that only two-thirds

of the facility is habitable because of construction defects. Its

action against the construction company for those defects is set

for trial in San Francisco Superior Court on May, 2007. 

Beginning in 2005, the lender began increasing the amount

Plaintiff needed to deposit into escrow to cover increased taxes,

which Plaintiff disputed. The amount varied from month to month,

and Plaintiff disputed the amount several times. Plaintiff refused

to pay one amount in November, 2005 and another in April, 2006. 

Although Plaintiff did not pay the additional amount, it paid the

remainder of its obligation on the loan. After Plaintiff refused

to pay the April, 2006, $25,000 amount into escrow and HUD refused

to waive Plaintiff's obligation, the lender informed Plaintiff that

the loan was in default and would be assigned to HUD. HUD accepted

the assignment of the loan on May 24, 2006. 

SFCC alleges that at the time the loan was assigned to HUD, it

"had paid all amounts actually assessed by the City and County of

Case 4:06-cv-07444-CW Document 13 Filed 12/11/06 Page 17 of 20
United States District Court

For the Northern District of California

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San Francisco for the property, so there was no delinquency in the

actual tax assessment." Reply at 3-4. Rather, the delinquency was

based on the lender's valuation of the newly constructed building

and estimated tax increase. Plaintiff alleges that the lender

never communicated the increased valuation to it. Since the loan

has been assigned to HUD, Plaintiff has not made any payments. 

However, payments have been taken from Plaintiff's Reserve for

Replacement account. 

Plaintiff alleges that "the assessment of an[] additional

$25,000 for taxes was improper and was not a legitimate basis on

which to declare a default in the Note and Deed of Trust and

trigger an assignment of the Note and Deed of Trust to HUD." Reply

at 5. Therefore, Plaintiff argues that HUD's decision to accept

the assignment of the loan "was arbitrary and capricious because it

was not based on any legitimate 'default' but rather on a default

which had been fabricated by the Lender." Id. 

HUD accepted sealed bids on the note and deed of trust on

Friday, December 6, 2006, and will accept the highest bid on

Tuesday, December 11, 2006, absent a TRO. Plaintiff argues that it

will suffer irreparable harm if Defendant is allowed to sell the

loan, based in part on its allegation that several of those who

have visited the facility in anticipation of bidding on the loan

have stated that they intend to foreclose the loan and take over

operation of the facility. 

LEGAL STANDARD

A temporary restraining order may be issued only if 

"immediate and irreparable injury, loss, or damage will result to

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the applicant" if the order does not issue. Fed. R. Civ. P. 65(b). 

To obtain a temporary retraining order, Plaintiff must establish

either: (1) a combination of probable success on the merits and the

possibility of irreparable harm, or (2) that serious questions

regarding the merits exist and the balance of hardships tips

sharply in its favor. See Baby Tam & Co. v. City of Las Vegas, 154

F.3d 1097, 1100 (9th Cir. 1998); Rodeo Collection, Ltd. v. West

Seventh, 812 F.2d 1215, 1217 (9th Cir. 1987).

DISCUSSION

Putting aside the question of Plaintiff's likelihood of

success on the merits, Plaintiff has not demonstrated any

irreparable harm that will come from the assignment of the loan. 

Plaintiff argues that if the loan is sold and if the party that

purchases the loan acts to foreclose the loan and to take over

operation of the facility, it "will result in a major monetary loss

for SFCC and the loss of a project which has taken years to develop

and which now serves San Francisco's senior citizens in need of

assisted living facilities." Reply at 9. However, the Ninth

Circuit has held that "[m]ere financial injury . . . will not

constitute irreparable harm if adequate compensatory relief will be

available in the course of litigation." Goldie's Bookstore, Inc.

v. Superior Court, 239 F.2d 466, 471 (9th Cir. 1984) (citations

omitted). 

Plaintiff's interest in the property is commercial. Further,

Plaintiff has itself described the result of a sale as a "major

monetary loss." The Court finds that adequate compensatory relief

will be available to Plaintiff if it proceeds against HUD in

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litigation and ultimately prevails. Further, Plaintiff's alleged

injury is based on its unsubstantiated belief that the entity that

purchases the loan will indeed foreclose on the loan and attempt to

take over the property. If this does happen, Plaintiff will have

an opportunity to attempt to recover compensatory damage for its

losses, and the residents of the facility will be able to continue

to live there under the new management. 

CONCLUSION

For the foregoing reasons, the Court DENIES Plaintiff's motion

for a temporary restraining order, without prejudice to Plaintiff

filing a noticed motion for a preliminary injunction if

appropriate. 

IT IS SO ORDERED.

Dated: 12/11/06 

CLAUDIA WILKEN

United States District Judge

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