F OR P UBLICATION



### UNIT E D ST AT E S CO URT O F APPE AL S FO R T H E NINT H CIRCUIT

M O H A M M A D A L I T A L

A I E , an individual on behalf of himself and all others similarly

situated; R O S A W

. T A L A I E , an individual on behalf of herself and all others similarly situated, Plaintiffs-Appellants
,

v

.

W E L L S F A

R G O B A N K , NA; US B A

N K NA, National Association as Trustee,

Defendants-Appellees

. N o. 13-56314

D.C. No. 2:12-cv-04959- D MG-AGR

OPI NI ON

A ppeal from the United States District Court for the Central District of California Dolly M. Gee, District J udg e, Presiding

Arg ued and Submitted November 2, 2015—Pasadena, California

F iled December 14, 2015

B efore: W illiam A. F letcher and Ronald M. Gould, Circuit J udg es, and Dana L

. Christensen, * Chief District J udg e.

O pinion by

J udg e Gould

* T h e Ho n o rab le Dan a L

. C h risten sen , Ch ief District J u d g e f o r th e U .S. District Co u

rt f o r th e District o f

Mo n tan a, sittin g b y

d esig n atio n

.T A L A I E V

. W E L L S F A R

G O B A N K 2

SUMMARY * *

Truth in Lending Act

The panel affirmed the district court, a n d h e ld that 15 U.S.C § 1641(g ), a 2 009 a m e n dment to the 1968 Truth in L ending Act which requires a creditor wh o o b t ains a mortg ag e loan by sal e or transfer to n otify the b orrower on th e t r a nsfer in writing
, does not apply retroactively because Cong r ess did ex press a clear intent that it do so.

COUNSEL

L enore L

. Albert (arg

u ed), Hunting ton B each, California, for Plaintiffs-Appellants.

Pa u l W

. Sweeney (arg

ued), Kevin S. Asfour, and Nancy C. Hag an, K& L Gates L L P, L os Ang eles, California, for Defendants-Appellees.

OP INION

GOUL D, Circuit J udg e :

W e c onsider the retroactivity o f 15 U.S.C. § 1641(g ), a 2009 amendment to the 1968 Truth in L ending Act (TI L A). Section 1641(g ) requires a creditor who obtains a m o r t gag e

** T h is su m m ary co n stitu

t es n o p ar t o f t h e o p in io n o f th e co u rt. It h as b een p rep ared b y

co u rt staf

f f o r th e co n v en i en ce o f

th e read er.T A L A I E V

. W E L L S F A R

G O B A N K 3

loan by sale or transfer to notify the borrower of the transfer in writing

. Althoug h s e v e ral district courts have issued decisions on this statute’s retroactive effect, this is an issue o f first impression in our circuit.

Plaintiffs Mohammad and Rosa T alaie broug ht a p utative class action ag ainst W e lls F arg o B ank and U.S. B ank, alleg ing v arious federal and state law claims a rising o ut o f the modification of the deed of trust for the Talaies’ home. One of Plaintiffs’ claims is that De f e ndants did not comply with § 1641(g ). 1 J udicially noticed securitiz atio n c ontracts establish that W e lls F arg o transferred Plaintiffs’ deed of trust to U.S. B ank in 2006, three y ear s b e f o re Cong ress enacted § 1641(g )

. The reportin g r equirement of § 1641(g ) would apply to this loan tr ansfer only if § 1641(g ) had retroactive ef f e c t

. Fo r the reasons that follow, we hold that 15 U .S.C. § 1641(g ) does not apply

retroactively

.

Section 1641(g ) requires that “not later than 30 day s a fter
t he d ate on which a mortg ag e loan is sold or otherwise transferred or assig ned to a third party , the creditor that is the

new owner or assig nee of the debt s h al l notify the borrower in writing of such transfer,” and must include the date of the transfer, contact i n fo r m a tion f or the new creditor, and other relevant information. 1 5 U.S.C. § 1641(g ). I f the new creditor does not comply with this d uty , Cong ress authoriz ed the borrower to sue the c reditor to recover actual damag es, a statutory p enalty of up to $4,000 in individual claims or up to $1 million in a class action, plus costs and a t torney ’s fees. 15 U.S.C. § 1640(a).

1 W e reso lv e all oth er i ss u e s a n d af f irm th e d istrict co u rt in a

m em o ran d u m

d isp o s itio n

f iled co n cu rren tly

w ith th is o p in io n

.T A L A I E V

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G O B A N K 4

I n g eneral, retro a c t ive application of statutes is disfavored. T he Supreme Court has h eld that the presumption
ag ainst retroactive leg islation is “deeply root e d in our jurisprudence,” and ca n o n l y b e overcome w here Cong ress

ex p resses a clear and unambig u ous intent to do so. Landgraf v. USI Film Prods. , 511 U.S. 244, 265 (1994). I n Landgraf
, the Court considere d § 102 o f the Civil Rig hts Act of 1991, which created a rig ht to recover compensatory and punitive damag es for certain violations of Title VI I of the Civil Rig hts Act of 1964. Landgraf
, 51 1 U

. S

. a t 247. Section 102 si gn i f icantly e x panded the monetary relief available to plaintiffs entitled to back pay under prior law, and also g ave monetary relief for “some f o rms of workplace discrimination that would not previously have justified any relief under Title VI I .” Id. at 254. The issue w as w hether § 1 0 2 a p p l ied to conduct predating its enact ment. T h e Supreme Court, in declini n g to make the statute retroactive, f irst observed the principle that “the leg al effect of c onduct should ordinarily be assessed under the law that ex isted wh e n t h e conduct took place,” to avoid the “unfairness of imposing new burdens on persons after the fact.” Id. at 265, 270. I f a new statute would “ impair rig hts a party possessed when h e acted, increase a party ’s liabilit y for past conduct, or impose new duties with respect to t ransactions already completed,” then
courts should not g ive retroactive effect to the statute without “clear cong r essional intent f avoring such a result.” Id. at 280.

Here, § 1641(g ) was introduced b y Senator B o x er o n May 1, 2 009 as an amendment to Senate B ill 896. 155 Cong

. Rec. S5027-03 ( 2009). Senator B o x er stated that while ex isting law required that borro wers be informed of a chang e in servicer of their mortg ag e loan, there was n o such notice

re q uirement f

or a c h ang e in loan owner. 155 Cong

. Rec. S5098–99 (2009). Th e a mendment was meant to provideT A L A I E V

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G O B A N K 5

“borrowers w ith the b asic rig ht to know who owns their loan by requ iring that any time a mortg ag e loan is sold o r transferred, the new n o t e owner shall notify the borrower within 30 day s

. . . .” Id. Senator B o x er noted that “[ t] h is is

a very narrowly targ eted amendment with little cost t o the industry .” Id.

Retroactive application of § 1641(g ) would implicate the

concerns hig hlig hted in Landgraf
, 511 U.S. at 2 8 0. F irst, retroactive application would impair r i ghts Defendants possessed when they acted, b ecause, consistent with the loan documents and the law at the time t h e y w ere sig ned, D e f e n d ants had a rig ht to sell o r transfer the loan without notice to the borrower. Second, retroactive application of the
statute would incre a se Defendants’ “liability for past conduct,” because the 2009 TI L A amendments provide new private rig hts of action including damag es, attorney ’s fees, and statutory p enalties, for failure to g ive notice of a loan transfer. Id. ; see 15 U .S.C. § 1 640(a). Third, retroactive applicatio n w o uld impose “new d uties” on transactions already completed; the very purpose of t h e statute was to

re q uire a loan transferee to g ive notice where none was p r e viously required. See 16 U.S.C. § 1641(g ); 155 C o n g. Rec. S5098–99. Given that all three of the retroactivity

concerns in Landgraf are present, w e nex t determine whether Cong r ess ex pressed a clear a nd unambig uous intent that § 1641(g ) apply r etroactively

. Landgraf , 511 U.S. at 280.

There is no cl ear indication, in § 1 641(g )’s tex t o r in its leg islative history
, that C o n g r e s s intended for it to apply to loans that had been transfe r r e d before its enactment. The
sta t ute requires notice within 30 day s of loan transfer a nd authoriz es damag es and statutory penalties for failu r e t o comply

. 15 U.S.C. § § 1641(g ) (1), 1640(a). I f the statuteT A L A I E V

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were g iven retroactive effect, this 3 0

- d ay r eporting period would have already lapsed for all loan transfers that occurred

more than a month before enactment, and it would h ave been impossible for those credito r s to comply with the reporting requirement. I t is unlikely that Cong ress would have broadly subjected c reditors to c ivil liability and statutory p en a l t ies without at least g iving them a way to comply with § 1641(g ) for loan transfers that p redated its enact m e n t. W e conclude that Cong ress did not make any such intention clear o r unambig uous. See Landgraf , 511 U.S. at 268.

Cong r ess has demonstrated, moreover, that it knows h ow to specify the effective date of statutory provisions. Fi r s t,

a n o t h er provision of TI L A, 15 U.S.C. § 1641(f), states th at “[ t] his subsection shall apply to all consumer credit transactions in ex istence o r consummated on o r a fter September 30, 1 995.” This effect i v e date for a parallel statutory p rovision strong ly sug g e sts that § 1 6 4 1 ( g ), which does n ot specify an e x press date, applies prospectively but does n ot ex tend to loan transfers pred a t ing its enactment. Second, Public L aw 111-22, which implemented § 1641(g ) along with several other T I L A amendments, pr o v i d ed a “retroactive effective dat e ” for a d ifferent component of the

same bill. Section 10 5
, which addressed the distribution o f f u nds under the Neig hborhood Stabiliz a tion Prog ram , incl u des a “retroactive e ffective date” stating that the amendment “shall take effect as if enacted on the date o f
enactment of the F oreclosure Prevention Act of 2008 (Public L aw 110-289).” P.L . 111-22, 123 Stat. 1632, 1638 (2009).

W e hold that § 1641(g ) doe s not apply retroactively because Cong ress did not ex press a clear intent that it do so. Landgraf
, 511 U.S. at 280

. Our holding is consistent with

numerous district court decisions interpreting § 1641(g ). See,T A L A I E V

. W E L L S F A R

G O B A N K 7

e.g. , Bradford v. HS

BC M o r t g. Corp.
, 829 F

. Supp. 2d 340, 353 ( E.D. Va. 2011); Diunugala v. JP Morgan Chase Bank, N.A. , No. 12-2106, 2015 W L 3966119, at *4 (S.D. Cal. J un. 30, 2015); Zinzuwadia v. M ortg. Elec. Registr., Inc.
, No. 12- 2281, 2013 W L 6 7 8 2 856, a t *11–12 (E.D. Cal. Dec. 19, 2013).

AF F IRMED.