United States District Court, D. Hawaii
ORDER: (1) GRANTING DEFENDANT'S MOTION TO
DISMISS; AND (2) GRANTING PLAINTIFF LEAVE TO AMEND
MICHAEL SEABRIGHT CHIEF UNITED STATES DISTRICT JUDGE.
29, 2016, Plaintiff Margot Maria Sluka
(“Plaintiff”) filed a Complaint for Declaratory
Relief against Defendant Rushmore Loan Management Services,
LLC (“Defendant”), seeking an order declaring
that Plaintiff's mortgage loan is rescinded, and
requiring Defendant to return all payments made on the
mortgage loan, cease further collection actions including
foreclosure, remove all reports of Plaintiff's debt
obligation on the mortgage from collection agencies, and
return the original promissory note.
before the court are (1) Defendant's Motion to Dismiss
With Prejudice Plaintiff's Complaint, or Alternatively,
For a More Definite Statement (“Motion to
Dismiss”), and (2) Plaintiff's Request for Leave to
Amend Complaint. For the reasons discussed below, the court
GRANTS the Motion to Dismiss, and GRANTS Plaintiff's
Request for Leave to Amend Complaint.
alleged in the Complaint, on March 23, 2007, Plaintiff
executed a promissory note for $224, 000 in favor of Taylor,
Bean & Whitaker Mortgage (“TBWM”), which is
secured by a mortgage on her home located at 75-5873 Walua
Road #B-218, Kailua-Kona, Hawaii (the “subject
property”). ECF No. 1, Compl. at 2. Sometime
thereafter, Plaintiff allegedly learned that the
“mortgage loan was an undisclosed securities
transaction” in which TBWM purchased the note and
mortgage for resale into a real estate mortgage backed
security trust offered by Federal Home Loan Mortgage
Corporation (“Freddie Mac”). Id. Upon
learning of this alleged “fraud, ” Plaintiff
requested the return of certain documents, “revoked all
signatures on the Mortgage document, ” and in December
2009, stopped making payments on the mortgage loan.
Id. at 3.
3, 2016, Plaintiff sent Defendant notice of her intent to
rescind the mortgage loan immediately, requested the return
of all monies Plaintiff paid on the loan and tendered the
subject property, pursuant to 15 U.S.C. § 1635. ECF No.
1-1, Pl.'s Ex. 1. Defendant allegedly failed to
“return all monies [Plaintiff] paid to [the mortgage
loan] account . . . and take possession of the property
within . . . 20 days from receipt [of the notice of intent to
rescind] as required by [15 U.S.C. ] § 1635(b).”
ECF No. 1-3, Pl.'s Ex. 3.
29, 2016, Plaintiff filed her Complaint for Declaratory
Relief. ECF No. 1. Defendant filed the instant Motion to
Dismiss on September 7, 2016. ECF No. 15. Plaintiff filed a
Response on October 3, 2016,  ECF No. 20, and on October 11,
2016, Defendant filed a Reply, ECF No. 22. On October 12,
2016, Plaintiff filed a Motion for Continuance to Amend
Complaint. ECF No. 23. Defendant filed a response in
opposition to a continuance on October 13, 2016, ECF No. 25,
and Plaintiff filed a reply to that opposition on October 21,
2016, ECF No. 31. On October 17, 2016, the court denied a
continuance, but indicated that it would address
Plaintiff's request for leave to file an amended
complaint at the hearing on Defendant's Motion to
Dismiss. ECF No. 26. These matters were heard on October 24,
STANDARDS OF REVIEW
Rule of Civil Procedure 12(b)(6) permits a motion to dismiss
for “failure to state a claim upon which relief can be
granted[.]” “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.'” Ashcroft v. Iqbal, 556 U.S.
662, 678 (2009) (quoting Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007)); see also Weber
v. Dep't of Veterans Affairs, 521 F.3d 1061, 1065
(9th Cir. 2008). This tenet -- that the court must accept as
true all of the allegations contained in the complaint --
“is inapplicable to legal conclusions.”
Iqbal, 556 U.S. at 678. Accordingly,
“[t]hreadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not
suffice.” Id. (citing Twombly, 550
U.S. at 555); see also Starr v. Baca, 652 F.3d 1202,
1216 (9th Cir. 2011) (“[A]llegations in a complaint or
counterclaim may not simply recite the elements of a cause of
action, but must contain sufficient allegations of underlying
facts to give fair notice and to enable the opposing party to
defend itself effectively.”).
“[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.” Iqbal, 556 U.S. at 678
(citing Twombly, 550 U.S. at 556). Factual
allegations that only permit the court to infer “the
mere possibility of misconduct” do not show that the
pleader is entitled to relief as required by Rule 8.
Iqbal, 556 U.S. at 679.
Pro Se Pleadings
Plaintiff is proceeding pro se, the court liberally construes
her Complaint. See Erickson v. Pardus, 551 U.S. 89,
94 (2007); Eldridge v. Block, 832 F.2d 1132, 1137
(9th Cir. 1987) (per curiam). The court also recognizes that
“[u]nless it is absolutely clear that no amendment can
cure the defect . . . a pro se litigant is entitled to notice
of the complaint's deficiencies and an opportunity to
amend prior to dismissal of the action.” Lucas v.
Dep't of Corr., 66 F.3d 245, 248 (9th Cir. 1995);
see also Crowley v. Bannister, 734 F.3d 967, 977-78
(9th Cir. 2013). A court may, however, deny leave to amend
where further amendment would be futile. See, e.g.,
Leadsinger, Inc. v. BMG Music Pub., 512 F.3d 522,
532 (9th Cir. 2008) ...