Preview
1 Jana Logan (SBN 171152) Electronically Filed
Matthew H. Aguirre (SBN 270388) 9/18/2020 12:20 PM
2 KIRBY & McGUINN, A P.C. Superior Court of California
707 Broadway, Suite 1750 County of Stanislaus
3 San Diego, California 92101 Clerk of the Court
Telephone: (619) 398-3354
4 Facsimile: (619) 398-3355 By: Joshua Teixeira, Deputy
E-mail: jlogan@kirbymac.com
5 E-mail: maguirre@kirbymac.com
6 Attorneys for Defendants
Fay Servicing, LLC
7 U.S. Bank, National Association, as Legal Title Trustee for Truman 2016 SC6 Title Trust
8
IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA
9
FOR THE COUNTY OF STANISLAUS
10
MAIN COURTHOUSE
11
12
LINDA ROSE EXPOSE CASE NO. CV19005329
13
Plaintiff, FAY SERVICING, LLC AND U.S. BANK,
14 NATIONAL ASSOCIATION, AS LEGAL
v. TITLE TRUSTEE FOR TRUMAN 2016
15 SC6 TITLE TRUST'S REPLY
FAY SERVICING, U.S. BANK NATIONAL MEMORANDUM OF POINTS AND
16 ASSOCIATION, ATTORNEY LENDER AUTHOPRITIES IN SUPPORT OF
SERVICE, INC and DOES 1-5, inclusive THEIR DEMURRER TO THE FIRST
17 AMENDED COMPLAINT
Defendants.
18 [TELEPHONIC APPEARANCE]
19 Date: September 25, 2020
Time: 8:30 a.m.
20 Dept.: 22
Judge: Hon. Stacy P. Speiller
21
Date Action Filed: September 5, 2019
22
23 COMES NOW, Defendants Fay Servicing, LLC and U.S. Bank, National Association, as
24 Legal Title Trustee for Truman 2016 SC6 Title Trust (together “Defendants”) to reply to Plaintiff’s
25 Opposition to their demurrer to the First Amended Complaint
26
27
28
1
FAY SERVICING, LLC AND U.S. BANK, NATIONAL ASSOCIATION, AS LEGAL TITLE TRUSTEE FOR
TRUMAN 2016 SC6 TITLE TRUST’S REPLY MPA ISO DEMURRER TO FAC
1 MEMORANDUM OF POINTS AND AUTHORITIES
2 I. ARGUMENT
3 Plaintiff opposes the demurrer by claiming that Defendants do not have standing and no legal
4 authority to sign a notice of default, which allegations were also set forth in her First Amended
5 Complaint (“FAC”). The sole issue addressed in the Opposition is a Fair Debt Collections Practices
6 Act (“FDCPA”) cause of action that is not alleged in the FAC. Plaintiff has failed to oppose or
7 otherwise respond to Defendants’ arguments to the causes of action alleged in the FAC The Court
8 should sustain Defendants’ demurrer without leave to amend.
9 II. ALLEGED VIOLATION OF FDCPA DOES NOT RESUSCITATE THE FAC
10 In her Opposition, Plaintiff attempts to allege a FDCPA cause of action but that, too fails. To
11 be liable for a violation of the FDCPA, a defendant must be a “debt collector” within the meaning of
12 the statute. (See 15 U.S.C. §§ 1692f(1), 1692e(2)(A), 1692a(6).) Pursuant to 15 U.S.C. § 1692a(6),
13 a “debt collector” is “any person who uses any instrumentality of interstate commerce or the mails in
14 any business the principal purpose of which is the collection of any debts, or who regularly collects
15 or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due
16 another.” The term “debt collector” under the FDCPA “does not include the consumer’s creditors, a
17 mortgage servicing company, or any assignee of the debt, so long as the debt was not in default at
18 the time it was assigned.” (Monreal v. GMAC Mortg., LLC, 948 F. Supp. 2d 1069, 1085 (S.D. Cal.
19 2013) (internal quotations, citation, and italics omitted); see also Perry v. Stewart Title Co., 756 F.2d
20 1197, 1208 (5th Cir. 1985) (“The legislative history of section 1692a(6) indicates conclusively that a
21 debt collector does not include the consumer’s creditors, a mortgage servicing company, or an
22 assignee of a debt, as long as the debt was not in default at the time it was assigned.”).
23 There are no allegations in the FAC to support a FDCPA cause of action. Plaintiff’s FAC
24 centers around her arguments that the foreclosure sale was invalid. The Ninth Circuit Court of
25 Appeals has found that the FDCPA does not apply to the enforcement of a security interest such as a
26 non-judicial foreclosure proceeding. In Ho v. ReconTrust Company, NA, the Ninth Circuit explained
27 that the FDCPA imposes liability only when an entity attempts to collect a money debt. (Ho v.
28 ReconTrust Company, NA, 858 F.3d 568, 571 (9th Cir. 2016). The objective of a nonjudicial
1
REPLY MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FAC
1 foreclosure, in contrast, is to “retake and resell the security, not to collect money from the
2 borrower.” (Id.) Thus, the Ninth Circuit held that an entity does not become a debt collector ifits
3 “only role in the debt collection process is the enforcement of a security interest.” (Id. at 573
4 (quoting Wilson v. Draper & Goldberg, P.L.L.C., 443 F.3d 373, 378 (4th Cir. 2006).) Even though
5 the enforcement of a security interest may create an incentive to pay the underlying debt, the Ninth
6 Circuit rejected the notion that this incentive was sufficient to transform security interest
7 enforcement into debt collection, because this would “render meaningless the FDCPA's carefully
8 drawn distinction between debt collectors and enforcers of security interests, and expand the scope
9 of the FDCPA well past the boundary of clear congressional intent and common sense.” (Id. at 574.)
10 Plaintiff alleges that defendants engaged in debt collection by doing the foreclosure. But the
11 Ninth Circuit found that the enforcement of a security interest necessarily includes the right to send
12 required notices and other communications to the debtor, and “[w]hen these communications are
13 limited to the foreclosure process, they do not transform foreclosure into debt collection.” (Ho, 858
14 F.3d at 574.) Plaintiff has not alleged that defendants have done more than what was required to
15 enforce the deed of trust. The FAC gives no reason to believe that defendants engaged in conduct
16 outside the scope of what was statutorily required to foreclose.
17 III. CONCLUSION
18 For the foregoing reasons, Defendants respectfully request that the Court sustain the
19 demurrer without leave to amend. The demurrer should be sustained without leave to amend
20 because granting such leave would be futile in light of the noted deficiencies in the FAC and the
21 Opposition.
22 DATED: September 18, 2020 KIRBY & McGUINN, A P.C.
23
BY:
24
JANA LOGAN
25 MATTHEW H. AGUIRRE
Attorneys for Defendants
26 Fay Servicing, LLC
U.S. Bank, National Association, as Legal
27 Title Trustee for Truman 2016 SC6 Title Trust
28
2
REPLY MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FAC
Preview
1 Jana Logan (SBN 171152) Electronically Filed Matthew H. Aguirre (SBN 270388) 9/18/2020 12:20 PM 2 KIRBY & McGUINN, A P.C. Superior Court of California 707 Broadway, Suite 1750 County of Stanislaus 3 San Diego, California 92101 Clerk of the Court Telephone: (619) 398-3354 4 Facsimile: (619) 398-3355 By: Joshua Teixeira, Deputy E-mail: jlogan@kirbymac.com 5 E-mail: maguirre@kirbymac.com 6 Attorneys for Defendants Fay Servicing, LLC 7 U.S. Bank, National Association, as Legal Title Trustee for Truman 2016 SC6 Title Trust 8 IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 FOR THE COUNTY OF STANISLAUS 10 MAIN COURTHOUSE 11 12 LINDA ROSE EXPOSE CASE NO. CV19005329 13 Plaintiff, FAY SERVICING, LLC AND U.S. BANK, 14 NATIONAL ASSOCIATION, AS LEGAL v. TITLE TRUSTEE FOR TRUMAN 2016 15 SC6 TITLE TRUST'S REPLY FAY SERVICING, U.S. BANK NATIONAL MEMORANDUM OF POINTS AND 16 ASSOCIATION, ATTORNEY LENDER AUTHOPRITIES IN SUPPORT OF SERVICE, INC and DOES 1-5, inclusive THEIR DEMURRER TO THE FIRST 17 AMENDED COMPLAINT Defendants. 18 [TELEPHONIC APPEARANCE] 19 Date: September 25, 2020 Time: 8:30 a.m. 20 Dept.: 22 Judge: Hon. Stacy P. Speiller 21 Date Action Filed: September 5, 2019 22 23 COMES NOW, Defendants Fay Servicing, LLC and U.S. Bank, National Association, as 24 Legal Title Trustee for Truman 2016 SC6 Title Trust (together “Defendants”) to reply to Plaintiff’s 25 Opposition to their demurrer to the First Amended Complaint 26 27 28 1 FAY SERVICING, LLC AND U.S. BANK, NATIONAL ASSOCIATION, AS LEGAL TITLE TRUSTEE FOR TRUMAN 2016 SC6 TITLE TRUST’S REPLY MPA ISO DEMURRER TO FAC 1 MEMORANDUM OF POINTS AND AUTHORITIES 2 I. ARGUMENT 3 Plaintiff opposes the demurrer by claiming that Defendants do not have standing and no legal 4 authority to sign a notice of default, which allegations were also set forth in her First Amended 5 Complaint (“FAC”). The sole issue addressed in the Opposition is a Fair Debt Collections Practices 6 Act (“FDCPA”) cause of action that is not alleged in the FAC. Plaintiff has failed to oppose or 7 otherwise respond to Defendants’ arguments to the causes of action alleged in the FAC The Court 8 should sustain Defendants’ demurrer without leave to amend. 9 II. ALLEGED VIOLATION OF FDCPA DOES NOT RESUSCITATE THE FAC 10 In her Opposition, Plaintiff attempts to allege a FDCPA cause of action but that, too fails. To 11 be liable for a violation of the FDCPA, a defendant must be a “debt collector” within the meaning of 12 the statute. (See 15 U.S.C. §§ 1692f(1), 1692e(2)(A), 1692a(6).) Pursuant to 15 U.S.C. § 1692a(6), 13 a “debt collector” is “any person who uses any instrumentality of interstate commerce or the mails in 14 any business the principal purpose of which is the collection of any debts, or who regularly collects 15 or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due 16 another.” The term “debt collector” under the FDCPA “does not include the consumer’s creditors, a 17 mortgage servicing company, or any assignee of the debt, so long as the debt was not in default at 18 the time it was assigned.” (Monreal v. GMAC Mortg., LLC, 948 F. Supp. 2d 1069, 1085 (S.D. Cal. 19 2013) (internal quotations, citation, and italics omitted); see also Perry v. Stewart Title Co., 756 F.2d 20 1197, 1208 (5th Cir. 1985) (“The legislative history of section 1692a(6) indicates conclusively that a 21 debt collector does not include the consumer’s creditors, a mortgage servicing company, or an 22 assignee of a debt, as long as the debt was not in default at the time it was assigned.”). 23 There are no allegations in the FAC to support a FDCPA cause of action. Plaintiff’s FAC 24 centers around her arguments that the foreclosure sale was invalid. The Ninth Circuit Court of 25 Appeals has found that the FDCPA does not apply to the enforcement of a security interest such as a 26 non-judicial foreclosure proceeding. In Ho v. ReconTrust Company, NA, the Ninth Circuit explained 27 that the FDCPA imposes liability only when an entity attempts to collect a money debt. (Ho v. 28 ReconTrust Company, NA, 858 F.3d 568, 571 (9th Cir. 2016). The objective of a nonjudicial 1 REPLY MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FAC 1 foreclosure, in contrast, is to “retake and resell the security, not to collect money from the 2 borrower.” (Id.) Thus, the Ninth Circuit held that an entity does not become a debt collector ifits 3 “only role in the debt collection process is the enforcement of a security interest.” (Id. at 573 4 (quoting Wilson v. Draper & Goldberg, P.L.L.C., 443 F.3d 373, 378 (4th Cir. 2006).) Even though 5 the enforcement of a security interest may create an incentive to pay the underlying debt, the Ninth 6 Circuit rejected the notion that this incentive was sufficient to transform security interest 7 enforcement into debt collection, because this would “render meaningless the FDCPA's carefully 8 drawn distinction between debt collectors and enforcers of security interests, and expand the scope 9 of the FDCPA well past the boundary of clear congressional intent and common sense.” (Id. at 574.) 10 Plaintiff alleges that defendants engaged in debt collection by doing the foreclosure. But the 11 Ninth Circuit found that the enforcement of a security interest necessarily includes the right to send 12 required notices and other communications to the debtor, and “[w]hen these communications are 13 limited to the foreclosure process, they do not transform foreclosure into debt collection.” (Ho, 858 14 F.3d at 574.) Plaintiff has not alleged that defendants have done more than what was required to 15 enforce the deed of trust. The FAC gives no reason to believe that defendants engaged in conduct 16 outside the scope of what was statutorily required to foreclose. 17 III. CONCLUSION 18 For the foregoing reasons, Defendants respectfully request that the Court sustain the 19 demurrer without leave to amend. The demurrer should be sustained without leave to amend 20 because granting such leave would be futile in light of the noted deficiencies in the FAC and the 21 Opposition. 22 DATED: September 18, 2020 KIRBY & McGUINN, A P.C. 23 BY: 24 JANA LOGAN 25 MATTHEW H. AGUIRRE Attorneys for Defendants 26 Fay Servicing, LLC U.S. Bank, National Association, as Legal 27 Title Trustee for Truman 2016 SC6 Title Trust 28 2 REPLY MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FAC