United States District Court, D. Hawaii
GRANTING DEFENDANTS OCWEN LOAN SERVICING, LLC AND DEUTSCHE
BANK NATIONAL TRUST COMPANY'S REQUEST FOR THE COURT TO
TAKE JUDICIAL NOTICE (ECF No. 8-2) and GRANTING DEFENDANTS
OCWEN LOAN SERVICING, LLC AND DEUTSCHE BANK NATIONAL TRUST
COMPANY'S MOTION TO DISMISS (ECF No. 8)
Gillmor United States District Judge
Merlita Agbannaoag and Jerry Agbannaoag have filed a
Complaint against Ocwen Loan Servicing, LLC and Deutsche Bank
National Trust Company.
claim that they executed an Adjustable Rate Note in favor of
AmeriFund Financial, Inc. to obtain a Loan to purchase real
property on the island of Maui. The Loan was secured by a
Mortgage, which was recorded against the real property.
Plaintiffs claim that the Note and Mortgage were assigned to
Defendant Deutsche Bank National Trust Company and that
Defendant Ocwen Loan Servicing, LLC is the servicer.
Complaint alleges claims against both Defendants.
is alleged against both Defendants for breach of implied
covenant of good faith and fair dealing.
II is missing from the Complaint. The Complaint skips
paragraphs 68-74. The Prayer for Relief in Plaintiffs'
Complaint states that Count II is alleged against both
Defendants for tortious breach of good faith and fair
III is alleged against both Defendants for unfair and
deceptive acts or practices.
additional Counts are alleged in the Complaint. The Complaint
skips paragraphs 88-99. The Prayer for Relief in
Plaintiffs' Complaint states that Count IV is alleged
against both Defendants for tortious interference with a
business relationship and that Count V is for violations of
the Fair Debt Collection Practices Act.
filed a Motion to Dismiss all claims pursuant to Federal Rule
of Civil Procedure 8, 9, and 12(b)(6).
have also filed a Request for the Court to Take Judicial
Notice in Support of their Motion to Dismiss.
Request for the Court to Take Judicial Notice (ECF No. 8-2)
Motion to Dismiss (ECF No. 8) is GRANTED. Plaintiffs are
permitted LEAVE TO FILE A MOTION TO AMEND their Complaint
consistent with this Order.
24, 2016, Plaintiffs Merlita Agbannaoag and Jerry Agbannaoag
filed a Complaint in the Circuit Court of the Second Circuit,
State of Hawaii. (Complaint attached as Ex. 1 to
Defendants' Notice of Removal, ECF No. 1).
14, 2016, Defendants Ocwen Loan Servicing, LLC and Deutsche
Bank National Trust Company removed the state court action to
the United States District Court for the District of Hawaii.
(ECF No. 1).
20, 2016, Defendants filed a MOTION TO DISMISS and a REQUEST
FOR JUDICIAL NOTICE IN SUPPORT OF MOTION TO DISMISS
PLAINTIFFS' COMPLAINT. (ECF Nos. 8, 8-2).
28, 2016, the Court issued a briefing schedule. (ECF No. 10).
Plaintiffs' Opposition was due on or before August 17,
did not file their Opposition on or before August 17, 2016.
September 2, 2016, Plaintiffs filed PLAINTIFF'S EX PARTE
MOTION FOR LEAVE TO FILE A MEMORANDUM IN OPPOSITION TO
DEFENDANT'S MOTION TO DISMISS PLAINTIFF'S COMPLAINT,
claiming excusable neglect. (ECF No. 12).
September 6, 2016, the Court issued a Minute Order granting
Plaintiffs' Request to file their Opposition. (ECF No.
13). The Court also provided Defendants with additional time
to file their Reply. (Id.)
September 16, 2016, Plaintiffs filed their MEMORANDUM IN
OPPOSITION TO DEFENDANT'S MOTION TO DISMISS
PLAINTIFF'S COMPLAINT. (ECF No. 16). The Opposition
consisted of two and a half pages. The contents were limited
to an argument that Hawaii state procedural law applied
rather than the Federal Rules of Civil Procedure.
September 30, 2016, Defendants filed DEFENDANTS' REPLY IN
SUPPORT OF MOTION TO DISMISS PLAINTIFF'S COMPLAINT. (ECF
October 17, 2016, a hearing was held on Defendants'
Motion to Dismiss.
Complaint states that on February 1, 2005, Plaintiffs Merlita
and Jerry Agbannaoag (“Plaintiffs”) executed an
Adjustable Rate Note in the amount of $395, 000 to AmeriFund
Financial, Inc. to purchase real property on the island of
Maui. (Complaint at ¶ 3, ECF No. 1; see
Adjustable Rate Note dated February 1, 2005, attached as Ex.
B to Defendants' Request for Judicial Notice at pp.
14-18, ECF No. 8-4).
Complaint asserts that repayment of the Note was secured by a
Mortgage, which was recorded against the real property
purchased by Plaintiffs. (Complaint at ¶¶ 3, 42,
ECF No. 1; Mortgage attached to Plaintiff's Complaint,
recorded in the State of Hawaii Bureau of Conveyances on
February 10, 2005, Doc. No. 2005-027341, at pp. 31-44, ECF
allege that the Note and Mortgage were assigned to Defendant
Deutsche Bank National Trust Company (“Defendant
Deutsche Bank”). (Complaint at ¶¶ 4, 43, ECF
No. 1; Assignment of Mortgage, attached as Ex. B to
Defendants' Request for Judicial notice at p. 45, ECF No.
8-4). Plaintiffs assert that Defendant Ocwen Loan Servicing,
LLC (“Defendant Ocwen Loan Servicing”) is the
servicer of their Loan and is responsible for collecting
payments and applying the payments to their debt. (Complaint
at ¶¶ 5, 18, 42, ECF No. 1).
assert that both Defendants engaged in bad faith, unfair and
deceptive practices, interfered with business relationships,
and violated the Fair Debt Collection Practices Act by
failing to fulfill their obligations to the Plaintiffs,
failing to correct errors in their account, failing to
respond to written requests, charging interest off inaccurate
principal balances, charging fraudulent fees, and failing to
properly oversee and manage the servicing of their loan.
(Id. at ¶¶ 53, 56, 59, 62, 86).
allege that Defendants instructed Plaintiffs “to
default in order to qualify for a loan modification and then
failed to mitigate damages and offered an unaffordable loan
modification with payments higher than the original payment
causing them to charge excessive late fees and penalties,
interest on a higher principal amount, inspection fees when
services were never rendered, and legal fees and
costs.” (Id. at ¶¶ 67, 78, 101).
Court must dismiss a complaint as a matter of law pursuant to
Federal Rule of Civil Procedure 12(b)(6) where it fails
“to state a claim upon which relief can be
granted.” Rule (8)(a)(2) of the Federal Rules of Civil
Procedure requires “a short and plain statement of the
claim showing that the pleader is entitled to relief.”
When considering a Rule 12(b)(6) motion to dismiss, the Court
must presume all allegations of material fact to be true and
draw all reasonable inferences in favor of the non-moving
party. Pareto v. F.D.I.C., 139 F.3d 696, 699 (9th
Cir. 1998). Conclusory allegations of law and unwarranted
inferences are insufficient to defeat a motion to dismiss.
Id. at 699. The Court need not accept as true
allegations that contradict matters properly subject to
judicial notice or allegations contradicting the exhibits
attached to the complaint. Sprewell v. Golden State
Warriors, 266 F.3d 979, 988 (9th Cir. 2001).
Bell Atl. Corp. v. Twombly, the United States
Supreme Court addressed the pleading standards under the
Federal Rules of Civil Procedure in the anti-trust context.
550 U.S. 544 (2007). The Supreme Court stated that Rule 8 of
the Federal Rules of Civil Procedure “requires more
than labels and conclusions, and a formulaic recitation of
the elements of a cause of action, ” and that
“[f]actual allegations must be enough to raise a right
to relief above the speculative level.” Id. at
recently, in Ashcroft v. Iqbal, the Supreme Court
clarified that the principles announced in Twombly
are applicable in all civil cases. 129 S.Ct. 1937 (2009). The
Court stated that “the pleading standard Rule 8
announces does not require ‘detailed factual
allegations, ' but it demands more than an unadorned,
Id. at 1949 (citing 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.(quoting Twombly, 550 U.S. 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. (citing Twombly, 550 U.S. at
556). The plausibility standard is not akin to a
“probability requirement, ” but it asks for more
than a sheer possibility that a defendant has acted
unlawfully. Id. (quoting Twombly, 550 U.S.
at 556). Where a complaint pleads facts that are
“merely consistent with” a defendant's
liability, it “stops short of the line between
possibility and plausibility of ‘entitlement to
relief.'” Id. (quoting Twombly,
550 U.S. at 557).
complaint “must contain sufficient allegations of
underlying facts to give fair notice and to enable the
opposing party to defend itself effectively” and
“must plausibly suggest an entitlement to relief, such
that it is not unfair to require the opposing party to be
subjected to the expense of discovery and continued
litigation.” AE ex rel. Hernandez v. Cnty of
Tulare, 666 F.3d 631, 637 (9th Cir. 2012) (internal
DEFENDANTS' REQUEST FOR JUDICIAL NOTICE (ECF No.
Court may consider exhibits attached to the Complaint and
documents whose contents are incorporated by reference in the
Complaint without converting a motion to dismiss to a motion
for summary judgment. Davis v. HSBC Bank Nevada,
N.A., 691 F.3d 1152, 1160 (9th Cir. 2012).
the Court will consider the Mortgage attached as Ex. 1 to
Plaintiffs' Complaint. (ECF No. 1 at pp. 31-46).
Court may also consider matters that are the proper subject
of judicial notice pursuant to Federal Rule of Evidence 201.
Lee v. City of Los Angeles, 250 F.3d 668, 688-89
(9th Cir. 2001); Tellabs, Inc. v. Makor Issues &
Rights, Ltd., 551 U.S. 308, 322 (2007). Federal Rule of
Evidence 201 allows a court to take judicial notice of public
documents. Barber v. Ohana Military Communities,
LLC, 2014 WL 3529766, *4 (D. Haw. July 15, 2014).
Request for Judicial Notice seeks judicial notice of publicly
available Court records from the United States Bankruptcy
Court of Hawaii in Case Nos. 11-02518 and 12-01401 that
involve the Plaintiffs and Defendant Deutsche Bank.
Court grants the Defendants' Motion to consider the
following documents pertaining to Plaintiff Jerry Agbannaoag:
(1) Chapter 7 Voluntary Petition filed by Plaintiff Jerry
Agbannaoag dated September 22, 2011, in the United States
Bankruptcy Court of Hawaii, Case No. 11-02518, attached as
Ex. A (ECF No. 8-3);
(2) Motion for Relief from Stay filed by Defendant Deutsche
Bank National Trust Company dated December 16, 2011, in the
United States Bankruptcy Court of Hawaii, Case No. ...