1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court 

For the Northern District of California 

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA 

EUEL ALLEN, 

Plaintiff, 

v. 

UNITED FINANCIAL MORTGAGE CORP.; 

ALLIANCE BANKCORP; MORTGAGE 

ELECTRONIC REGISTRATION SYSTEMS, 

INC.; CALIFORNIA RECONVEYANCE CO.; 

GMAC MORTGAGE; JP MORGAN CHASE 

BANK; INVESTORS MORTGAGE AND 

REALTY; DOES 1 to 25, inclusive, 

Defendants. 

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

Case No. 09-2507 SC 

ORDER GRANTING IN PART AND 

DENYING IN PART MOTION TO 

DISMISS

I. INTRODUCTION

 Now before the Court is a single Motion to Dismiss ("Motion") 

filed on behalf of Defendants JPMorgan Chase Bank, N.A. 

("JPMorgan") and California Reconveyance Co. ("CRC") (collectively, 

"Defendants").1

 Docket No. 31. Defendants seek to dismiss 

Plaintiff Euel Allen's ("Plaintiff's") First Amended Complaint 

("FAC"), Docket No. 29, which Plaintiff submitted after this Court 

dismissed portions of his original Complaint, see Docket No. 25 

("Sept. 15, 2009 Order"). The Motion is fully briefed. Docket 

Nos. 38 ("Opp'n"), 39 ("Reply"). The Court has concluded that this 

matter is appropriate for determination without oral argument. For 

 

1

 No other Defendant participated in this Motion. 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 1 of 15
2 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

the reasons stated below, Defendants' Motion is GRANTED IN PART and 

DENIED IN PART. 

II. DISCUSSION

 The parties are familiar with the factual background for this 

dispute as well as the applicable legal standards, which this Court 

outlined in its previous Order. See Sept. 15, 2009 Order at 2-4. 

The FAC adds a number of allegations to Plaintiff's case, some of 

which are relevant to the claims that Defendants now seek to 

dismiss. The Court will address these new claims in the context of 

each cause of action below. 

A. TILA and HOEPA

 Plaintiff's first cause of action alleges that JPMorgan, as 

well as a number of other Defendants, violated the Truth In Lending 

Act ("TILA"), 15 U.S.C. §§ 1601 et seq., as well as the Home 

Ownership and Equity Protection Act of 1994("HOEPA"), id. §§ 1639 

et seq. The only basis for dismissal that JPMorgan advances for 

this cause of action is the one-year statute of limitations placed 

upon actions to recover damages under either statute.2

 15 U.S.C. 

§ 1640(e); Mot. at 4-5. As this Court previously noted, Allen 

entered into the loans in October of 2006, and did not file suit 

until May of 2009, well after the statute of limitations had 

expired. Sept. 15, 2009 Order at 6. The Court previously 

dismissed Plaintiff's claim for damages, with leave to amend, and 

invited Plaintiff to allege a factual basis for equitable tolling. 

Id. In his FAC, Plaintiff has attempted to provide such 

 

2

 Defendants do not seek to dismiss Plaintiff's claim for 

rescission, which he asserts through the same cause of action. 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 2 of 15
3 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

allegations. See FAC ¶ 32. 

 A TILA suit for damages must generally be brought "within one 

year from the date of the occurrence of the violation," which 

courts have interpreted as meaning "within a year from consummation 

of the transaction."3

 King v. California, 784 F.2d 910, 915 (9th 

Cir. 1986). Nevertheless, "equitable tolling might be appropriate 

in certain circumstances," and courts may deem the statute tolled 

"until the borrower discovers or had reasonable opportunity to 

discover the fraud or nondisclosures that form the basis of the 

TILA action." Id. "[P]laintiffs seeking to toll the statute of 

limitations on various grounds must have included the allegation in 

their pleadings." Wasco Prods. v. Southwall Techs., Inc., 435 F.3d 

989, 991 (9th Cir. 2006); see also Pace v. DiGuglielmo, 544 U.S. 

408, 418 (2005) (recognizing that plaintiff bears burden of 

establishing basis for tolling). Where equitable tolling may be 

applicable to a federal claim, the "claim accrues . . . upon 

awareness of the actual injury, not upon awareness that this injury 

constitutes a legal wrong." Lukovsky v. San Francisco, 535 F.3d 

1044, 1049 (9th Cir. 2008) (quoting Amini v. Oberlin College, 259 

F.3d 493, 500 (6th Cir. 2001)); accord Norgart v. Upjohn Co., 21 

Cal. 4th 383, 397-98 (1999) ("[T]he plaintiff discovers the cause 

of action when he at least suspects a factual basis, as opposed to 

a legal theory, for its elements, even if he lacks knowledge 

thereof -- when, simply put, he at least suspects that someone has 

done something wrong to him, wrong being used, not in any technical 

 

3

 This time limit does not apply to claims for rescission under 

TILA, which "shall expire three years after the date of 

consummation of the transaction or upon the sale of the property, 

whichever occurs first." 15 U.S.C. § 1635(f). 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 3 of 15
4 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

sense, but rather in accordance with its lay understanding." 

(internal citations and quotation marks omitted)). 

 Plaintiff claims that he did not receive the Federal Truth in 

Lending Disclosure Statement ("TILA Statement") "until after escrow 

closed." FAC ¶ 13. He claims that the document only summarized a 

portion of the loan that he received, while ignoring a portion 

secured by a second deed of trust for which no statement was ever 

received. Id. The document also omitted certain required 

disclosures and falsely stated the amount of payments under the 

loan. Id. On April 30, 2009, only after he received a copy of the 

Notice of Trustee's Sale and sought the advice of an attorney, did 

Plaintiff "learn[] for the first time that he was entitled to TILA 

documents immediately after he applied for the loan, and that the 

disclosures on their face were apparent violations of TILA and 

HOEPA." Id. ¶ 41. 

 The FAC does not present a plausible case for equitable 

tolling. Plaintiff would have had a reason to suspect wrongdoing 

once he received lending documents that contained amounts that 

differed significantly from the amounts that he had previously 

agreed to. His cause of action accrued whenever he received the 

TILA Statement, because the violations were, according to 

Plaintiff, apparent on the face of the documents. Id. The FAC 

does not clearly indicate when Plaintiff received the TILA 

Statement -- only that he received it sometime "after escrow 

closed." Id. ¶ 13. If he received it any time before May of 2008 

-- and no allegation suggests otherwise -- then his cause of action 

accrued more than one year before he filed this action. At best, 

the FAC suggests around April 30, 2009, Plaintiff finally realized 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 4 of 15
5 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

the extent of his injury (by receiving the Notice of Trustee's 

Sale), and the fact that the omissions and misstatements in his 

loan documents constituted violations of particular federal 

statutes (i.e., he discovered an applicable legal theory). 

Plaintiff's prior ignorance of these facts does not toll the 

statute of limitations. 

 This Court has already granted Plaintiff leave to amend this 

cause of action, with specific instructions to allege tolling. 

Plaintiff's claim for damages under TILA and HOEPA is therefore 

DISMISSED WITH PREJUDICE. However, Defendants have not sought to 

disturb Plaintiff's rescission claim, which is governed by TILA's 

three-year statute of limitations. Plaintiff's rescission claim 

therefore remains undisturbed by this Order. 

B. Fraud

 Plaintiff's second cause of action alleges fraud against 

JPMorgan and a number of other defendants, based around 

misrepresentations contained in the loan origination documents. 

FAC ¶ 50. Plaintiff also alleges that he was "lulled" into a false 

sense of security by employees of Washington Mutual, and later 

JPMorgan, who instructed him not to make payments in order to avoid 

forfeiture of his right to modify his loans. Id. ¶¶ 23-28, Ex. D 

("Allen Letter"). 

 As to Plaintiff's first fraud claim, which alleges fraud in 

connection with the origination of the loan, JPMorgan contends that 

it cannot be held liable for its role as successor to the lender of 

this mortgage. Mot. at 6-7. According to the Deeds of Trust for 

Plaintiff's loans, Plaintiff received one loan from Defendant 

United Financial Mortgage Corp, and another loan from Alliance 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 5 of 15
6 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

Bankcorp. See Request for Judicial Notice ("RJN"), Docket No. 32, 

Exs. 3 ("First DoT") at 1, 4 ("Second DoT") at 1.4 Plaintiff 

alleges that Washington Mutual acquired both of these loans from 

the original lenders, and that JPMorgan later succeeded Washington 

Mutual in its role. FAC ¶¶ 17, 19. However, JPMorgan did not 

acquire these loans in full, directly from Washington Mutual. 

According to JPMorgan, the Office of Thrift Supervision appointed 

the Federal Deposit Insurance Corporation ("FDIC") as the receiver 

for Washington Mutual, and the FDIC thereby "took over the assets 

of" Washington Mutual and assumed the power to transfer its assets 

and liabilities. 12 U.S.C. §§ 1821(d)(2)(A)(i), 1821 (d)(2)(B)(i), 

1821(d)(2)(G)(i). The FDIC thereafter entered into a Purchase and 

Assumption Agreement with JPMorgan, wherein JPMorgan assumed 

assets, but not associated liabilities, that had belonged to 

Washington Mutual. RJN Ex. 8 ("PAA"). 

 Part of the PAA states: 

[A]ny liability associated with borrower claims 

for payment of or liability to any borrower for 

monetary relief, or that provide for any form of 

relief to any borrower . . . related in any way 

to . . . any loan made by a third party in 

connection with a loan which is or was held by 

the Failed Bank, or otherwise arising in 

connection with the Failed Bank's lending or loan 

purchase activities are specifically not assumed 

by the Assuming Bank. 

Id. § 2.5. Other Courts that have interpreted this provision have 

concluded that "JPMorgan Chase expressly disclaimed assumption of 

liability arising from borrower claims," thereby leaving "the FDIC 

as the responsible party with respect to those claims." Hilton v. 

 

4

 The Court GRANTS Defendants' Request for Judicial Notice for the 

same reasons stated in its previous Order. See Sept. 15, 2009 

Order at 4-5. 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 6 of 15
7 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

Wash. Mut. Bank, No. 09-1191, 2009 U.S. Dist. LEXIS 100441, *6-9 

(N.D. Cal. Oct. 28, 2009) (quoting Cassese v. Washington Mutual 

Bank, 05-2724, slip op. at 6 (E.D.N.Y. Dec. 22, 2008)); see also

Payne v. Security Sav. & Loan Ass'n, 924 F.2d 109, 111 (7th Cir. 

1991) ("Absent an express transfer of liability by the [Receiver] 

and an express assumption of liability by Security Federal, FIRREA 

directs that [the Receiver] is the proper successor to the 

liability at issue here."). This Court may consider this evidence, 

which is subject to judicial notice, without converting the Motion 

to Dismiss into a motion for summary judgment. See Lee v. City of 

Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001). Based on this 

evidence, the Court concludes that JPMorgan is not a proper 

defendant to this particular "borrower claim." 

 The PAA explicitly does not relieve JPMorgan from any 

liability that it has incurred in its role as a loan servicer. PAA 

§ 2.1; see also Punzalan v. Federal Deposit Insurance Co., No. 09-

0087, 2009 U.S. Dist. LEXIS 57829, *3 (W.D. Tex. July 9, 2009) 

("Chase Bank purchased Washington Mutual on the condition that FDIC 

remain responsible for any 'Borrower Claims' . . . 'in connection 

with Washington Mutual's lending or loan purchase activities.' In 

exchange . . . Chase Bank promised to assume responsibility for all 

other liabilities, specifically including 'all mortgage servicing 

rights and obligations of Washington Mutual.'" (citations 

omitted)). JPMorgan therefore may still be held liable for 

fraudulent representations made in the course of its provision of 

loan services to Plaintiff. 

 Plaintiff also alleges that since purchasing his loan from 

Washington Mutual, JPMorgan has acted as the servicer for his 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 7 of 15
8 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

loan.5 FAC ¶¶ 19. In particular, he alleges that he was working 

with Washington Mutual to modify his loan when it was purchased by 

JPMorgan in late 2008, and that JPMorgan represented to him that it 

was continuing to process his modification package after the 

purchase. Id. ¶¶ 23-26. The FAC references and attaches a letter 

from Plaintiff to Washington Mutual and JPMorgan, which refers to a 

"March 2, 2009 phone conversation with Mr. Jason" as well as "your 

letter dated January 8, 2009," which "stated that during this time 

if I make any kind of payment or agree to a repayment plan then I 

will forfeit my modification." Allen Letter at 1.6

 The FAC 

therefore includes a plausible allegation that JPMorgan may have 

committed wrongdoing while acting as Plaintiff's loan servicer. 

 JPMorgan's Reply includes a token recitation of the 

requirements of Rule 9(b) of the Federal Rules of Civil Procedure, 

which requires fraud claims to be pled with specificity. Reply at 

5-6. JPMorgan faults Plaintiff for failing to allege who, 

specifically, made the representations, as well as "when and where, 

and exactly what was said." Id. However, the FAC identifies a 

particular letter, dated January 8, 2009, in which JPMorgan made at 

least one potentially misleading statement. Plaintiff's claim for 

fraud is therefore sufficiently detailed to put JPMorgan on notice 

as to the claims against it. See Bly-Magee v. California, 236 F.3d 

 

5

 It is not clear whether JPMorgan has acted in this capacity with 

respect to one or both of Plaintiff's loans. It appears that one 

loan was transferred to Defendant GMAC Mortgage at some point. FAC 

¶¶ 21-22. 

6

 Although it is not clear from the FAC whether Plaintiff's letter 

was referring to a letter sent by JPMorgan or Washington Mutual, 

the Court notes that by January 8, 2009, JPMorgan had already 

entered into the PAA to acquire Washington Mutual's assets. See

PAA at 1. 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 8 of 15
9 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

1014, 1019 (9th Cir. 2001) (allegations must be "specific enough to 

give defendants notice of the particular misconduct which is 

alleged to constitute the fraud charged so that they can defend 

against the charge and not just deny that they have done anything 

wrong" (citations and quotation marks omitted)). 

 Plaintiff's second cause of action for fraud is DISMISSED WITH 

PREJUDICE as to JPMorgan only, to the extent that it alleges fraud 

in the origination of the loans. This cause of action is 

undisturbed to the extent that it alleges fraud in the provision of 

loan services. 

C. RESPA

 Plaintiff alleges that Defendants violated RESPA by failing to 

notify him of certain assignments of the loan and its servicing 

rights, and failed "to provide meaningful toll-free access for 

Plaintiff to secure information regarding the status of the 

obligations." FAC ¶ 55. The Court previously dismissed this cause 

of action because Plaintiff failed to allege that he suffered any 

pecuniary loss as a result of these alleged violations. Sept. 15, 

2009 Order at 11-13. Plaintiff has since added the following 

allegation: 

As a proximate result of Defendants', and each of 

them [sic], breach, Plaintiff has been damaged in 

that he at the time of the loan was not 

financially able to pay a monthly mortgage 

payment of more than $2,000.00 and that as a 

result he fell behind in his payments on the 

mortgage, his credit was impacted negatively, he 

suffered many sleepless nights and much emotional 

distress knowing that he was no longer able to 

pay the mortgage. 

FAC ¶ 58. 

 Plaintiff does not describe why Defendants' failure to provide 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 9 of 15
10 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

proper notices of assignment of servicing rights and ownership of 

the security instruments for the loans resulted in his inability 

"to pay a monthly mortgage payment of more than $2,000.00 . . . ." 

See id. He does not allege, in more than a conclusory manner, any 

pecuniary loss that resulted from a failure to provide the 

requisite notices. "Threadbare recitals of the elements of a cause 

of action, supported by mere conclusory statements, do not suffice" 

to defeat a motion for dismissal. Ashcroft v. Iqbal, 129 S. Ct. 

1937, 1949 (2009). As this Court previously noted, the requirement 

that plaintiffs plead pecuniary damage is not a mere pleading 

formality; it is a requirement that "has the effect of limiting the 

cause of action to circumstances in which plaintiffs can show that 

a failure of notice has caused them actual harm." Sept. 15, 2009 

Order at 12. Even if Plaintiff is correct in claiming that 

Defendants' other conduct resulted in his inability to pay his 

mortgage, this does not constitute a RESPA claim unless Plaintiff 

can point to some colorable relationship between his injury and the 

actions or omissions that allegedly violated RESPA. 

 Plaintiff also alleges that "[b]y virtue of said [RESPA] 

failures, [CRC] is not the lawful Trustee and lacked jurisdiction 

to record a Notice of Default, a Notice of Sale, or to conduct a 

Trustee Sale or to record any Trust Deed." FAC ¶ 56. Regardless 

of whether the FAC states a separate basis for voiding any of the 

instruments related to Plaintiff's mortgage or the foreclosure 

proceedings, this Court is not aware of (and Plaintiff has not 

drawn this Court's attention to) any law or regulation that may 

render an instrument void or voidable based solely on a failure to 

follow the notice requirements of RESPA. Instead, RESPA allows for 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 10 of 15
11 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

"any actual damages to the borrower as a result of [a] failure" to 

follow its provisions. See 12 U.S.C. § 2605(f); see also 12 U.S.C. 

§ 2615 ("Nothing in this Act shall affect the validity or 

enforceability of any sale or contract for the sale of real 

property or any loan, loan agreement, mortgage, or lien made or 

arising in connection with a federally related mortgage loan."). 

Plaintiff's third cause of action for violation of RESPA is 

DISMISSED WITH PREJUDICE as to all Defendants. 

D. Fair Debt Collection Practices Act ("FDCPA")

 Plaintiff claims that CRC violated the FDCPA, 15 U.S.C. 

§§ 1692, et seq. FAC ¶ 60. This Court previously dismissed this 

claim because Plaintiff failed to allege that any particular 

Defendant was a "debt collector" as defined by the Act. Sept. 15, 

2009 Order at 13-14. The FDCPA defines a "debt collector" as "any 

person who uses any instrumentality of interstate commerce or the 

mails in any business the principal purpose of which is the 

collection of any debts, or who regularly collects or attempts to 

collect, directly or indirectly, debts owed or due or asserted to 

be owed or due another." 15 U.S.C. § 1692a(6). 

 The FAC now includes the strained allegation that "Defendants 

all are debt collectors," but also includes more specific 

allegations referencing CRC. FAC ¶ 60. According to Plaintiff, 

CRC was neither an originator of the loans nor a servicer. In 

particular, Plaintiff notes that "CRC acquired its interest in 

these transactions after Plaintiff defaulted on the obligations."7 

 

7

 Because of this allegation, this case is distinguishable from 

numerous decisions among this circuit's district courts, which have 

held that "the FDCPA does not apply to non-judicial foreclosure 

proceedings since a debt collector for purposes of the Act does not 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 11 of 15
12 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

Id. At this stage of the litigation, this Court may infer that CRC 

acquired its interest in the loan or loans in order to foreclose on 

Plaintiff's property, or to collect upon Plaintiff's debt. 

Plaintiff's allegations are consistent with his claim that CRC is a 

debt collector, and he has satisfied his low burden at the pleading 

stage for establishing that CRC is a "debt collector" under the 

FDCPA. 

 Defendants also claim that the act of foreclosure cannot serve 

as the basis for an FDCPA claim. Mot. at 9. Defendants cite a 

number of cases on this point, including Hulse v. Ocwen Fed. bank, 

FSB, which held that "[f]oreclosing on a trust deed is distinct 

from the collection of the obligation to pay money. . . . Payment 

of funds is not the object of the foreclosure action. Rather, the 

lender is foreclosing its interest in the property." 195 F. Supp. 

2d 1188, 1204 (D. Or. 2002); see also Mansour v. Cal-Western 

Reconveyance Corp., 618 F. Supp. 2d 1178, 1182 (D. Ariz. 2009) 

("[A] non-judicial foreclosure proceeding is not the collection of 

a 'debt' for purposes of the FDCPA."); Izenberg v. ETS Servs., LLC, 

589 F. Supp. 2d 1193, 1999 (C.D. Cal. 2008) (same); Heinemann v. 

Jim Walter Homes, Inc., 47 F. Supp. 2d 716, 722 (D.W.Va.1998), 

aff'd, 173 F.3d 850 (4th Cir.1999) (same). 

 Among the district courts of the Ninth Circuit, Hulse is 

perhaps the most widely cited for the proposition that "the 

activity of foreclosing on the property pursuant to a deed of trust 

 

include the consumer's creditors, a mortgage servicing company, or 

an assignee of a debt, as long as the debt was not in default at 

the time it was assigned." Suetos v. Bank of Am. Nat'l Ass'n, No. 

09-727, 2010 U.S. Dist. LEXIS 20538, *11-12 (E.D. Cal. Mar. 8, 

2010) (quoting Perry v. Stewart Title Co., 756 F.2d 1197, 1208 (5th 

Cir.). 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 12 of 15
13 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

is not the collection of a debt within the meaning of the FDCPA." 

195 F. Supp. 2d at 1204. This rule has become widely adopted among 

the district courts of this circuit. However, Plaintiff points out 

that the conclusions of Hulse have been called into question. 

Indeed, the Fourth Circuit has explicitly disagreed with the 

reasoning in Hulse, and has concluded that a "'debt' remain[s] a 

'debt' even after foreclosure proceedings commenced," and that 

actions "surrounding foreclosure proceedings -- including "an 

eviction notice required by statute" -- can be considered attempts 

to collect such debts. Wilson v. Draper & Goldberg, P.L.L.C., 443 

F.3d 373, 376 (4th Cir. 2006) (citing Romea v. Heiberger & Assocs., 

163 F.3d 111, 116 (2d Cir. 1998); Shapiro & Meinhold v. Zartman, 

823 P.2d 120, 124 (Colo. 1992)). Similarly, the Fifth Circuit has 

concluded that "a party who satisfies § 1692a(6)'s general 

definition of a 'debt collector' is a debt collector for the 

purposes of the entire FDCPA even when enforcing security 

interests." Kaltenback v. Richards, 464 F.3d 524, 528-29 (5th Cir. 

2006); but see Brown v. Morris, 243 Fed. Appx. 31, 35-36 (5th Cir. 

2008) (finding that "a foreclosure is not per se FDCPA debt 

collection," and finding no error in jury instruction that 

"[o]rdinarily, the mere activity of foreclosing . . . under a deed 

of trust is not the collection of a debt within the meaning of the 

[FDCPA] unless other actions are taken beyond those necessary to 

foreclose under the deed of trust, and were taken in an effort to 

collect a debt" (brackets in appellate order)). 

 As far as this Court is aware, neither Wilson nor Kaltenback

have been addressed by district courts in the Ninth Circuit. In 

their Reply, Defendants do not even attempt to discuss the 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 13 of 15
14 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

countervailing authority presented by Plaintiff. Instead, 

Defendants completely ignore Plaintiff's arguments in support of 

his FDCPA claim, and simply repeat their citation to Hulse and 

Heinemann. Reply at 5. This Court finds the reasoning in Wilson

compelling, but it is not yet willing to conclude whether it 

applies fully to this case,8

 or that it undercuts the recent trends 

among district courts within the Ninth Circuit. In the absence of 

any responsive briefing the topic, Defendants have failed to 

persuade this Court that Plaintiff may not pursue his FDCPA claim 

against CRC on the basis of CRC's conduct in relation to the nonjudicial foreclosure process. The Court may revisit the 

applicability of the FDCPA at a later time, if and when Defendants 

are willing to address the matter fully. 

III. CONCLUSION

Defendants' Motion to Dismiss is GRANTED IN PART and DENIED IN 

PART. 

Plaintiff's first cause of action is DISMISSED WITH PREJUDICE, 

as to all Defendants, only with respect to his claim for damages. 

Plaintiff's claim for rescission in his first cause of action 

remains intact as to all Defendants. 

Plaintiff's second cause of action for fraud is DISMISSED WITH 

PREJUDICE only with regard to his claims arising out of the 

origination of the loans, and only as to Defendant JPMorgan. 

Plaintiff's allegations of fraud based on JPMorgan's alleged 

 

8

 Unlike in Wilson, Plaintiff does not base his allegations of 

unfair debt collection on any activity or communication outside of 

those required by the relevant foreclosure statutes. However, such 

allegations do not appear to be central to the reasoning in Wilson. See 443 F.3d at 376. 

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 14 of 15
15 

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California 

provision of loan services is not dismissed. Plaintiff's second 

cause of action remains intact in all other regards and with 

respect to all other Defendants. 

Plaintiff's third cause of action is DISMISSED WITH PREJUDICE. 

Plaintiff's fourth, fifth, and sixth causes of action are not 

disturbed by this Order. 

The parties are ordered to appear for a case management 

conference that will take place on Friday, April 9, 2010, at 10:00 

a.m. in Courtroom 1, on the 17th floor, U.S. Courthouse, 450 

Golden Gate Avenue, San Francisco, CA 94102. 

IT IS SO ORDERED. 

Dated: March 22, 2010 

UNITED STATES DISTRICT JUDGE

Case 3:09-cv-02507-SC Document 41 Filed 03/22/10 Page 15 of 15