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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

KARIM ALLAN,

Plaintiff,

 v.

GREENPOINT MORTGAGE FUNDING, et

al.

Defendants. /

No. C 08-01534 MHP

MEMORANDUM & ORDER

Re: Plaintiff Allan’s and Defendant

GreenPoint Mortgage Funding’s CrossMotions for Summary Judgment

Plaintiff Karim Allan (“Allan”) brought this suit against GreenPoint Mortgage Funding

(“GreenPoint”), a mortgage lender, and other defendants in March 2008, alleging various claims

arising from the refinancing of Allan’s home in late-2006. Allan’s complaint asserted six causes of

action against GreenPoint: (1) for violating the Real Estate Settlement Procedures Act (“RESPA”)

and related regulations, 12 U.S.C. §§ 2603, 2607, 24 C.F.R. §§ 3500.7, 3500.14; (2) for violating the

Truth-in Lending Act (“TILA”) and related regulations, 15 U.S.C. § 1601 et seq., 12 C.F.R. §§

226.17-226.19; (3) for violating the Racketeer Influenced Corrupt Organizations Act (“RICO”), 18

U.S.C. §§ 1961-62; (4) for violating the Fair Housing Act (“FHA”), 42 U.S.C. § 3604; (5) for deceit,

Cal. Civ. Code §§ 1709-10; and (6) for breach of fiduciary duty. Before the court are cross motions

for summary judgment from Allan and GreenPoint. Allan moves for summary judgment in his favor

on his first and second causes of action, arising under RESPA and TILA respectively. GreenPoint 

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moves for summary judgment in its favor on all six causes of action. Having considered the parties’

submissions, and for the reasons discussed below, the court enters the following memorandum and 

order.

BACKGROUND

In the spring and summer of 2006, mortgage broker and co-defendant Ameriwest Funding &

Realty Group (“Ameriwest”) convinced Allan to refinance his home using Ameriwest’s brokering

services. Docket No. 38 (First Amended Complaint (“FAC”)) at 19. Ameriwest submitted a loan

application on Allan’s behalf to GreenPoint, which GreenPoint received on November 9, 2006. 

Docket No. 75 (Stewart Dec.) ¶ 3; id., Exh. A (“Major Events Log”). 

In response to this application, GreenPoint sent Allan a set of disclosures on November 9,

2006. Stewart Dec. ¶ 4; Major Events Log. Among these disclosures were the following

documents:

• A “Truth-in-Lending Disclosure Statement,” stating that the annual

percentage rate of the proposed loan was 7.612%, and that the proposed loan

would have a variable rate feature. Stewart Dec., Exh. C. 

• A “Truth-in-Lending Summary Statement,” which contained an entry stating

“Term: 360”, and on the line immediately below, “Interest Rate: 3.000.” 

Toward the bottom of the page, this document stated “Index (if ARM

[Adjustable Rate Mortgage]): 4.827,” followed by “Fully Indexed Rate:

7.077.” A space for indicating the “Index Date” was left blank. Id.

• A “Good Faith Estimate” (“GFE”) of settlement costs. This GFE did not

indicate that Allan’s proposed loan would include any yield spread premium

(“YSP”).1 Id., Exh. D.

GreenPoint sent a second set of disclosures to Allan on November 13, 2006, including

essentially the same documents but with different terms. Among this second set of disclosures were

the following:

• A second “Truth-in-Lending Disclosure Statement,” stating that the annual

percentage rate of the proposed loan was 8.214%, and that the proposed loan would

have a variable rate feature. Id., Exh. G.2

• A second GFE, which also did not indicate that Allan’s proposed loan would include

any YSP. Id., Exh. H.

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GreenPoint has also submitted a second “Truth-in-Lending Summary Statement,” which it claims it

sent to Allan in the second set of disclosures on November 13. See Stewart Dec., ¶ 5; id., Exh. G. 

However, this Truth-in-Lending Summary Statement is dated November 30, 2006, which (as is

discussed below) is the date that Allan received a third set of disclosures. This document contains

entries stating “Term: 360” and, on the following line, “Interest Rate: 1.000.” At the bottom of the

page, it also states “Index (if ARM): 4.827,” followed by “Fully Indexed Rate: 7.827”; it indicates a

“Index Date” of November 1, 2006. 

Allan locked in his loan rate on November 29, 2006, and GreenPoint printed a third set of

disclosures on the same day. Major Events Log. Allan received these disclosures along with the

loan documents which he signed on November 30, 2006. This third set of disclosures included, inter

alia, the following documents:

• A third “Truth-in-Lending Disclosure Statement,” stating that the annual percentage

rate of the loan was 7.933%, and that the loan had a variable rate feature. Stewart

Dec., Exh. J.

• A second “Truth-in-Lending Summary Statement,” whose terms are discussed above.

• A “New Loan Payment Form,” which contained an entry stating “Interest Rate:

1.000” and a second entry indicating “Loan Type: Adjustable.” Allan Mot., Exh. 5.

• An estimate of closing costs (known as a HUD-1) prepared by the closing agent,

North American Title Company. Allan Mot., Exh. 14. This HUD-1 did not indicate

that Allan’s loan included a YSP.

• A document entitled “Lender’s Closing Instructions.” This document disclosed that

Allan’s loan included a YSP. Stewart Dec., Exh. O at 3.

 This third set of disclosures did not include any GFE. 

The loan closed on December 13, 2006. Major Events Log. As noted in the final loan

documents, GreenPoint paid Ameriwest a YSP of $19,200. Stewart Dec., Exhs. O-P. On December

14, the closing agent prepared a second HUD-1 disclosing the YSP. Stewart Dec., Exh. P at 3.

After the loan closed, Allan received monthly statements indicating how much he owed on

his loan. Allan Dep. at 247:10-247:16; 254:19-255:6. Allan stopped making payments on his loan

in early-2008. Id. at 247:1-247:9. He then filed the complaint in this action on March 20, 2008. 

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Docket No. 1 (Compl.). In August 2009, Allan sold the property securing his loan, in a short sale. 

Docket No. 66 (Allan Dec.) ¶ 2. 

 LEGAL STANDARD

Summary judgment is proper when the pleadings, discovery and affidavits show that there is

“no genuine issue as to any material fact and that the moving party is entitled to judgment as a

matter of law.” Fed. R. Civ. P. 56(c). Material facts are those which may affect the outcome of the

case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The party moving for summary

judgment bears the burden of identifying those portions of the pleadings, discovery and affidavits

that demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S.

317, 323 (1986). On an issue for which the opposing party will have the burden of proof at trial, the

moving party need only point out “that there is an absence of evidence to support the nonmoving

party's case.” Celotex, 477 U.S. at 325. Once the moving party meets its initial burden, the

nonmoving party must go beyond the pleadings and, by its own affidavits or discovery, “set forth

specific facts showing that there is a genuine issue for trial.” Fed. R. Civ. P. 56(e)(2). Mere

allegations or denials do not defeat a moving party's allegations. Id.; Gasaway v. Northwestern Mut.

Life Ins. Co., 26 F.3d 957, 960 (9th Cir. 1994). Instead, the party opposing summary judgment must

present “significant probative evidence” supporting its allegations. Bias v. Moynihan, 508 F.3d

1212, 1218 (9th Cir. 2007). The court may not make credibility determinations. Anderson, 477 U.S.

at 255. When there are cross-motions for summary judgment, the court must determine the merits of

each motion and resolve all reasonable inferences against the moving party. Baldwin v. Trailer Inns,

Inc., 266 F.3d 1104, 1117 (9th Cir. 2001).

DISCUSSION

Allan has moved for summary judgment on two of his claims: the RESPA claim, based on

GreenPoint’s alleged failure to disclose in advance that GreenPoint would pay a YSP to Ameriwest,

and the TILA claim, based on allegedly false and misleading information in the disclosures

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GreenPoint sent to Allan. GreenPoint in turn moves for summary judgment on all six of Allan’s

claims. With respect to Allan’s RESPA and TILA claims, GreenPoint argues that they are timebarred, and that in any case, GreenPoint complied with the statutes’ requirements. With respect to

Allan’s claims under RICO and the FHA, and Allan’s claims for fraud and breach of fiduciary duty,

GreenPoint argues that Allan has failed to present sufficient evidence to create a triable issue of fact

on all the elements for which he will carry the burden of proof at trial.

As explained in more detail below, GreenPoint is entitled to summary judgment on all of

Allan’s claims, given Allan’s failure to present any significant probative evidence to support the

causes of action in his complaint. See Bias, 508 F.3d at 1218. The deficiencies in the record

presented by Allan are conspicuous. Firstly, Allan’s own declaration is only three paragraphs long,

and contains nothing from which wrongful conduct by GreenPoint could be inferred. Allan Dec. 

Secondly, despite repeated objections to the documents submitted by GreenPoint, Allan has

submitted no evidence of his own as to what disclosures he received from GreenPoint or what

documents he signed at the loan closing. Instead, his exhibits contain only documents provided to

him by GreenPoint in discovery, along with several questionably relevant pages printed from various

public websites. Allan has not himself authenticated any of the documents submitted to this court,

including those on which he relies for his claims, as having been actually received or signed by him. 

These evidentiary deficiencies are not rectified by the excessive length of Allan’s moving papers.3

In summary, Allan has presented no comprehensible story, supported by probative evidence,

showing that he is entitled to relief from GreenPoint on any of his claims. 

I. RESPA claim

Allan argues that he is entitled to summary judgment on his RESPA claim because he did not

receive either a GFE or a HUD-1 form disclosing the YSP that would be received by Ameriwest

until after he had signed the final loan documents. However, even viewing the evidence in the light

most favorable to Allan, his RESPA cause of action is time-barred. GreenPoint is therefore entitled

to summary judgment on this claim.

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Allan does not make clear what section of RESPA he relies upon in bringing his claim. The

most directly applicable sections of RESPA are 12 U.S.C. section 2604(c), which requires the lender

to provide a GFE, and 12 U.S.C. section 2603(a), which requires the lender to provide the HUD-1. 

However, neither of those sections provides for a private right of action. See, e.g., Collins v. FMHAUSDA, 105 F.3d 1366, 1367-68 (11th Cir. 1997); Urbina v. Homeview Lending Inc., 681 F. Supp. 2d

1254, 1259 (D. Nev. 2009); Bloom v. Martin, 865 F. Supp. 1377, 1384-85 (N.D. Cal. 1994)

(Armstrong, J.), aff’d on other grounds, 77 F.3d 318 (9th Cir. 1996). Given that he is foreclosed

from pursuing a claim under either section 2603 or 2604, Allan’s claim might rest upon 12 U.S.C.

section 2607, which creates liability on the part of lenders who provide kickbacks (which may

include YSPs) to brokers who refer business to them. However, a private action for violation of

section 2607 must be brought within one year of the date of occurrence of the violation. 12 U.S.C. §

2614. The violation in the instant case, if any, occurred in late-2006 when the YSP was paid by

GreenPoint to Ameriwest. Allan’s complaint was not filed until March 2008, fifteen months later,

and after the statute of limitations would have expired.

Allan argues that the statutory period should be equitably tolled, on the ground that a

reasonable person in his position would not have known that he had a claim against GreenPoint. In

so arguing, Allan betrays his misunderstanding of the test for equitable tolling. Equitable tolling is

appropriate only when “despite all due diligence, a plaintiff is unable to obtain vital information

bearing on the existence of his claim.” Santa Maria v. Pac. Bell, 202 F.3d 1170, 1178 (9th Cir.

2000). “If a reasonable plaintiff would not have known of the existence of a possible claim within

the limitations period, then equitable tolling will serve to extend the statute of limitations for filing

suit until the plaintiff can gather what information he needs.” Id. (emphasis added). In this case,

Allan has not presented evidence that he was unable to obtain any vital information bearing on his

claim. On the contrary, the evidence shows that Allan was provided at the loan signing on

November 30, 2006, and at the loan closing on December 14, 2006, with documents disclosing the

YSP. Stewart Dec., Exhs. O-P. Once Allan received documentation that Ameriwest had received a

YSP, he would have known (1) that Ameriwest had received a YSP and (2) that the earlier GFE or

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HUD-1 forms he had been provided with did not indicate that a YSP would be part of the

transaction. At that point, Allan had constructive notice that earlier GFE and HUD-1s failed to

disclose a YSP, as required by law. 

Furthermore, the evidence also shows that Allan received monthly statements showing the

amount he owed on his mortgage and the interest rate. Allan Dep. at 247:10-247:16, 253:21-256:7. 

This information was all that was required for Allan to know that he had a possible claim against

GreenPoint. Allan’s failure to realize that he had that information, and to act upon it, is not

sufficient reason to extend the statute of limitations. Furthermore, Allan failed to take due diligence

in scrutinizing the information he had in order to seek out a possible claim. See Allan Dep. at

254:19-255:12 (indicating that Allan did not look at his monthly statements every month). Allan

presents no evidence that he acted with due diligence to uncover his claim. He rests instead on

conclusory assertions about how long a reasonable person would take to realize that a claim existed. 

Such assertions are insufficient to justify equitable tolling. See Brown v. Option One Mortg. Corp.,

No. C 09-5705 MHP, 2010 WL 1267774, at *4 (N.D. Cal. Apr. 1, 2010) (Patel, J.). The court

therefore declines to toll the statute of limitations on Allan’s RESPA claim. 

Furthermore, the court notes that even if Allan’s complaint had been timely filed, Allan has

presented no evidence that the YSP constituted an illegal kickback in violation of RESPA. In order

to decide whether a YSP is an illegal kickback, the court must consider first whether the broker

actually performed any services for the compensation paid, and second whether the payments are

reasonably related to the services performed. Bjustrom v. Trust One Mortgage Corp., 322 F.3d

1201, 1207 (9th Cir. 2003). Here, Allan has presented no evidence relevant to either part of this test;

instead, he has rested his entire RESPA claim on the failure of GreenPoint to disclose the YSP in

advance. Allan’s failure to provide significant probative evidence supporting this claim provides an

independent ground for granting summary judgment to GreenPoint.

Accordingly, GreenPoint’s motion for summary judgment on Allan’s RESPA claim is

GRANTED.

II. TILA claim

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Allan argues that he is entitled to summary judgment on his TILA claim because the

disclosures he received, in particular the Truth-in-Lending Summary Statements, were false and

misleading. However, this claim is also time-barred.

Claims under TILA are also subject to a one-year statute of limitations. 15 U.S.C. § 1640(e). 

That statute of limitations begins to run on the date of the consummation of the loan transaction. 

King v. California, 784 F.2d 910, 915 (9th Cir. 1986). Since the loan transaction was consummated

in late-2006, and Allan did not file his complaint until March 2008, his suit is time-barred. 

As with his RESPA claim, Allan argues that the statute of limitations on his TILA claim

should be equitably tolled, because a reasonable person in Allan’s position would not have realized

for some time that the actual terms of Allan’s loan were different from the terms stated on the Truthin-Lending Summary statements. Equitable tolling “may, in the appropriate circumstances, suspend

the limitations period until the borrower discovers or had reasonable opportunity to discover the

fraud or nondisclosures that form the basis of the TILA action.” Id. However, Allan has again

presented no evidence sufficient to justify equitable tolling. Specifically, Allan has not presented

any evidence that he was lacking vital information necessary to bring his claim, or that he used due

diligence to try to obtain such information. On the contrary, the evidence shows that Allan was

presented with the Truth-in-Lending Summary Statements and the Truth-in-Lending Disclosure

Statements before the loan signing and at the loan signing; furthermore, he was provided with

monthly loan statements beginning immediately thereafter, indicating what amount he owed on the

loan and what his interest rate was. Any inconsistency among these documents would have raised

questions in the mind of a reasonable borrower, and provided a reasonable opportunity to discover

the existence of a potential TILA claim. Therefore, equitable tolling is inappropriate. GreenPoint’s

motion for summary judgment on Allan’s TILA claim is GRANTED.

In his opposition to GreenPoint’s motion for summary judgment, Allan also asserts that

GreenPoint is liable for violations of TILA committed by Ameriwest, because GreenPoint was

aware of those violations. Even if this theory of liability were valid, the violations Allan alleges are

based on documents he received in November 2006, and those documents provided Allan with all

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the information he would need to be aware of any potential claim. As such, these putative claims are

also time-barred, and are not subject to equitable tolling.

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III. RICO claim

Allan’s third claim asserts that GreenPoint violated RICO by engaging in an unlawful

enterprise to defraud homeowners who were refinancing their properties. However, Allan has again

failed to present evidence to support this claim. Allan’s evidence for his RICO claim consists of the

loan disclosures that GreenPoint sent to Allan, GreenPoint’s admission that it re-sold Allan’s loans

and servicing rights and several news reports on the existence of a loan processing infrastructure to

which mortgage brokers had access. This evidence is not sufficient to permit any reasonable finder

of fact to conclude that GreenPoint was part of an “enterprise” whose common purpose was to

defraud homeowners. Since Allan has failed to present a genuine issue of material fact on this issue,

GreenPoint’s motion for summary judgment on Allan’s RICO claims is GRANTED.

IV. Fair Housing Act claim

Allan’s fourth claim asserts that GreenPoint violated the Fair Housing Act by discriminating

against Allan on the basis of his Palestinian origin. Allan has presented no evidence in support of

this claim, and no argument in opposition to GreenPoint’s motion for summary judgment on this

claim. Therefore, GreenPoint’s motion for summary judgment on Allan’s FHA claim is

GRANTED.

V. Deceit

Allan’s fifth claim is for deceit, in violation of California Civil Code sections 1709 and 1710. 

Allan bases this claim on the written disclosures which Allan received from GreenPoint, which

Allan contends contain identifiable misrepresentations—specifically, the entry “Interest Rate: 3.000”

on the November 9 Truth-in-Lending Summary Statement, the entry “Interest Rate: 1.000” on the

November 30 Truth-in-Lending Summary Statement, and the entry “Interest Rate: 1.000” on the

New Loan Payment Form. However, these documents fall short of constituting the significant

probative evidence required for Allan’s deceit claim to survive GreenPoint’s motion for summary

judgment. Firstly, each of these documents also indicates that the rate on Allan’s loan is adjustable,

and provides the adjustment index and the fully indexed rate. Secondly, these documents were each

given to Allan in conjunction with other documents which more fully and completely explained the

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loan that Allan was receiving. Allan has presented no evidence showing that GreenPoint falsely

represented to him that these “3.000” and “1.000” entries indicated a fixed interest rate that he would

pay throughout the life of his loan. Indeed, Allan has presented no evidence that he even spoke with

a GreenPoint employee before signing his loans; Allan thus cannot claim that GreenPoint orally

misrepresented the meaning of the loan disclosures. Allan Dep. at 216:7-216:24. Thirdly, Allan has

presented no evidence that GreenPoint’s alleged misrepresentations were made knowingly or

negligently, as required by California Civil Code section 1710. Fourthly, Allan has not even

presented evidence showing the actual interest rate of his mortgage on any given month. That is, the

record does not provide any grounds for concluding that Allan’s interest rate was actually different

from the rates disclosed in the Summary Statements and New Loan Payment Form. Finally, Allan

has not presented evidence showing that he relied on these documents in entering the loan, or

suffered any damage based on the purported misrepresentations. Allan’s failure to provide

significant probative evidence requires summary judgment in favor of GreenPoint on Allan’s claim

for deceit. Accordingly, GreenPoint’s motion for summary judgment on Allan’s claim of deceit is

GRANTED.

VI. Breach of fiduciary duty

Allan’s final claim is for breach of fiduciary duty. GreenPoint has moved for summary

judgment on this claim on the ground that GreenPoint had no fiduciary duty to Allan. 

The relationship between a lender and a borrower is not a fiduciary one, and so does not give

rise to fiduciary duties. Nymark v. Heart Fed. Sav. & Loan Ass’n, 231 Cal. App. 3d 1089, 1093 n.1

(1991). Allan appears not to dispute this point, but argues that GreenPoint assumed a fiduciary duty

to Allan because GreenPoint was aware that Ameriwest, the mortgage broker, had breached its

fiduciary duty to Allan. Allan does not (and could not) cite to any law, decisional or otherwise, to

support this proposition. In the alternative, Allan argues that Ameriwest was not a real corporation,

but rather a branch of GreenPoint, and therefore GreenPoint owed Allan a fiduciary duty. To

support this contention, Allan points to several apparent irregularities in Ameriwest’s articles of

incorporation, and in the broker profile that GreenPoint maintained on Ameriwest. This evidence is

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not sufficient to raise a genuine issue of material fact as to whether GreenPoint and Ameriwest were

intertwined such that GreenPoint owed a fiduciary duty to Allan. Likewise, Allan’s assertions that

GreenPoint forged his signature on certain documents are irrelevant to his claim that Ameriwest was

a branch of GreenPoint, and are themselves not supported by significant evidence. As Allan has

presented no evidence that GreenPoint owed a fiduciary duty to him, GreenPoint’s motion for

summary judgment on Allan’s breach of fiduciary duty claims is GRANTED.

CONCLUSION

The court cannot emphasize enough the need for counsel to support their arguments with

sound, relevant and admissible evidence. Argument is not a substitute for evidence. In this case

there is no declaration from the plaintiff that supports the claims being made, that provides the

authentication and foundation for exhibits and ties them together, that supports the necessary

elements of each claim, and that provides facts to establish a basis for equitable tolling. These

matters are all within the knowledge of the plaintiff and, to the extent plaintiff lacks knowledge, he

needs to explain the absence of knowledge. Plaintiff has done none of this and has utterly failed to

support his claims with probative evidence, let alone “significant probative evidence.”

Therefore, plaintiff’s motion for summary judgment is DENIED and defendant GreenPoint’s

motion for summary judgment is GRANTED. 

IT IS SO ORDERED.

Dated: July 27, 2010 

MARILYN HALL PATEL

United States District Court Judge

Northern District of California

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1. A YSP is a payment by a mortgage lender to a mortgage broker, made when the mortgage broker’s

client (the borrower) takes out a loan from the mortgage lender at a higher interest rate. This device

allows borrowers to spread out their brokerage fees over the entire life of the loan, via a higher interest

rate, rather than paying their brokers the entire fee at the time of closing. On the other hand, it can also

permit unscrupulous brokers to make money at their clients’ expense. See Lane v. Residential Funding

Corp., 323 F.3d 739, 743 (9th Cir. 2003).

2. Allan objects to GreenPoint’s exhibits G and O attached to the declaration of Mia Stewart. Allan

attached the documents included in exhibit G to his own evidentiary submissions, and therefore his

objection carries no force. As for exhibit O, its contents have not proved dispositive for either parties’

claims. Accordingly, Allan’s objection is moot. 

3. The court notes with disapproval that Allan’s opposition to GreenPoint’s motion for summary

judgment exceeded the applicable page limit by three pages, and that Allan’s reply brief in support of

his own motion for summary judgment exceeded the applicable page limit by ten pages. See Civil Local

Rule 7-4(b).

ENDNOTES

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