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Richard W. Breinholt and Susan L. Breinholt v. Aegis Wholesale Corporation

July 11, 2012

RICHARD W. BREINHOLT AND SUSAN L. BREINHOLT,
PLAINTIFFS,
v.
AEGIS WHOLESALE CORPORATION, A CORPORATION, ONEWEST BANK, FORMERLY INDYMAC FEDERAL BANK, FSB, A BANK, TRI-COUNTY PROCESS SERVING, LLC, A LIMITED LIABILITY CORPORATION, A CORPORATION, PIONEER LENDER TRUSTEE SERVICES, LLC, A LIMITED LIABILITY CORPORATION, MORTGAGE ELECTRONIC REGISTRATION SERVICES (MERS); TITLE ONE CORPORATION, JENNIFER TAIT, ROBINSON TAIT, P.S. (LAW FIRM) JOHN AND JANE DOES IV, CORPORATIONS VI-X, AND ABC PARTNERSHIPS XI-XV, DEFENDANTS.



The opinion of the court was delivered by: Honorable Edward J. Lodge U. S. District Judge

MEMORANDUM DECISION AND ORDER

INTRODUCTION

The Court has before it defendant Mortgage Electronic Registration Systems' (MERS) Motion to Dismiss or, in the Alternative, for a More Definite Statement (Dkt. 64). Having fully reviewed the record, the Court finds that the facts and legal arguments are adequately presented in the briefs and record. Accordingly, in the interest of avoiding further delay, and because the Court conclusively finds that the decisional process would not be significantly aided by oral argument, this matter shall be decided without oral argument. For the reasons explained below, the Court will grant the motion.

BACKGROUND

In September 2005, plaintiffs Richard and Susan Breinholt refinanced their home with a loan from Aegis Wholesale Corporation. Compl., Dkt. 1, at 20, 25, 38. The loan was secured by a deed of trust. See id. Defendant MERS was named as the beneficiary under the deed of trust, acting as the "nominee" for Aegis. Sept. 1, 2005 Deed of Trust, Ex. 1 to Plaintiff's Response,*fn1 Dkt. 67-1, at 1, 2; see also Compl. at 25 (referencing the deed of trust). Plaintiffs allege that in May 2009, the property was "unlawful[ly]" foreclosed upon. Compl. at 25.

Within a few weeks of the foreclosure, the Breinholts sued various defendants in state court. Id. at 20 (referring to the state court complaint at Dkt. 19-6). There, the Breinholts alleged that "the Bank" (defined to include IndyMac and its successor, OneWest) foreclosed, despite having verbally assuring the Breinholts that a loan modification was in place. See State Court Compl., Dkt. 19-6, ¶¶ 20, 25, 35. Further, the Breinholts said they showed up on the courthouse steps at the time stated in the notice of trustee's sale because they had a third party lined up to buy the home out of foreclosure. They waited around for an hour and a half and then left when no one showed up to sell the property. Id. ¶¶ 27-32.

Based on these facts, the Breinholts sought a declaration that the foreclosure sale had either not occurred or, alternatively, was a sham. They also sought damages for breach of trustee's duties, forgery, fraud, theft, and conspiracy.

On September 10, 2010, the Breinholts brought this action in federal court. Three days later, on September 13, 2010, the Breinholts stipulated to a dismissal with prejudice of their state court action.

THE LEGAL STANDARD

A motion to dismiss based on Federal Rule of Civil Procedure 12(b)(6) "tests the legal sufficiency of a claim." Navarro v. Block, 250 F.3d 729, 731 (9th Cir. 2001). A complaint generally must satisfy "only the minimal notice pleading requirements" of Federal Rule of Civil Procedure 8(a)(2) to avoid a 12(b)(6) dismissal. Porter v. Jones, 319 F.3d 483, 494 (9th Cir. 2003). Rule 8(a)(2) "requires only 'a short and plain statement of the claim showing that the pleader is entitled to relief,' in order to 'give the defendant fair notice of what the . . . claim is and the grounds upon which it rests . . . . " Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)).

In considering a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), "all well-pleaded allegations of material fact are taken as true and construed in a light most favorable to the non-moving party." Wyler Summit Partnership v. Turner Broadcast Sys., Inc., 135 F.3d 658, 661 (9th Cir.1998) (citation omitted). While a complaint attacked by a Rule 12(b)(6) motion to dismiss "does not need detailed factual allegations," it must set forth "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555. To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face." Id. at 570. A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Id. at 556.

Finally, under Rule 12(b)(6), the Court may consider matters that are subject to judicial notice. Mullis v. United States Bank, 828 F.2d 1385, 1388 (9th Cir. 1987). The Court may take judicial notice "of the records of state agencies and other undisputed matters of public record" without transforming the motions to dismiss into motions for summary judgment. Disabled Rights Action Comm. v. Las Vegas Events, Inc., 375 F.3d 861, 866 (9th Cir. 2004). The Court may also examine documents referred to in the complaint, although not attached thereto, without transforming the motion to dismiss into a motion for summary judgment. See Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005).

ANALYSIS

MERS argues that the complaint should be dismissed because (1) it is barred by res judicata principles, and (2) it fails to state any claim upon which relief can ...


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