United States District Court, D. Hawaii
ORDER GRANTING DEFENDANTS' MOTION TO DISMISS WITH
LEAVE TO AMEND
DEIRICK K. WATSON UNITED STATES DISTRICT JUDGE
effort to invalidate a mortgage that is currently the subject
of a pending foreclosure action, the Aminas, proceeding pro
se, bring claims against several creditors and/or servicing
entities alleging violations of federal and state law. This
is the Aminas' third action filed in this district court
concerning this mortgage transaction. Defendants seek
dismissal of the Aminas' claims under the doctrines of
claim and issue preclusion or, alternatively, for failure to
state a claim. Because the requirements of claim and issue
preclusion have been met, and because Plaintiffs' claims
are additionally time-barred or fail to state a claim, the
Court GRANTS Defendants' Motions. Plaintiffs are granted
limited leave to amend claims that are not precluded or
time-barred, with instructions below.
Aminas bring claims against JPMorgan Chase Bank, N.A.
(“Chase”), Mortgage Electronic Registration
Systems, Inc. and MERSCORP Holdings, Inc. (collectively,
“MERS”), Nationwide Title Clearing, Inc.
(“NTC”), and WMC Finance Co.,  asserting eight
causes of action: a quiet title claim; a Fair Debt Collection
Practices Act claim (“FDCPA”); a Real Estate
Settlement Procedures Act claim (“RESPA”); an
accounting claim; an Unfair and Deceptive Trade Practices
claim under HRS Chapter 480 (“UDAP”); a Relief
From Judgment claim under FRCP 60; a Truth In Lending Act
claim (“TILA”); and a Declaratory Judgment claim.
Chase and MERS filed a Motion to Dismiss, Dkt. No. 14, and
NTC filed a substantive joinder in that Motion, Dkt. No. 26.
light of the substantial record of litigation involving the
Aminas' property and subject loans, the Court first
recounts the earlier lawsuits between the parties, before
addressing the present claims.
Aminas' claims relate to the same Mortgage on their real
property, located at 2304 Metcalf Street #2, Honolulu, Hawaii
96822 (“Property”) that is at issue in a pending
foreclosure proceeding and in two prior matters in this district
court that were decided in defendants'
favor. See Compl. ¶ 203, Dkt. No.
1-1. On March 20, 2010, the Aminas filed the first lawsuit,
Melvin Keakaku Amina, et al. v. WMC Mortgage, Corp. et
al., Civil No. 10-00165 JMS-KSC (the “First
Lawsuit”). The second case, entitled Melvin Keakaku
Amina, et al. v. The Bank of New York Mellon, fka The Bank of
New York, et al., Civil No. 11-00714 JMS-BMK (the
“Second Lawsuit”), was filed on November 28,
2011. Those cases challenged the validity of their Mortgage
and sought to quiet title.
The First Lawsuit
First Lawsuit, the Aminas alleged claims against Defendants
WMC Mortgage LLC, General Electric Company
(“GE”), MERS, Chase Home Finance LLC and Chase
Home Finance, Inc., and LCS Financial Services Corporation
for seeking to quiet title and for violations of TILA, RESPA,
the FDCPA, the Fair Credit Reporting Act
(“FCRA”), and state law. The Aminas' claims
arose from a mortgage transaction backing two loans from
WMC-one for $880, 000, and another for $220, 000-and a
threatened foreclosure of the Property located at 2304
Metcalf Street # 2, Honolulu, Hawaii 96822. See
Amina, 2011 WL 1869835, at *1 (D. Haw. May 16, 2011).
The district court, in the Second Lawsuit, summarized the
proceedings in the First Lawsuit as follows:
The court addressed two rounds of dispositive motions,
including (1) granting WMC and GE's Motion for Judgment
on the Pleadings and granting LCS's Motion for Summary
Judgment, 2011 WL 1869835 (D. Haw. May 16, 2011); and (2)
granting WMC and GE's Motion to Dismiss Second Amended
Complaint, 2011 WL 3841001 (D. Haw. Aug. 26, 2011).
After this motions practice, several of Plaintiffs'
claims in their May 31, 2011 Second Amended Complaint still
stood, including a claim for quiet title against MERS
entities, Chase entities, and “Unknown Owners.”
Civ. No. 1000165 JMS-KSC, Doc. No. 87, SAC Count II. This
claim asserted that MERS entities and Chase entities have all
falsely claimed a right to the subject property, and that
Plaintiffs are entitled to ownership of the subject property
without interference by Defendants. Id. ¶¶
In the meantime, motions for summary judgment were filed by
the remaining Defendants. Doc. Nos. 118, 121. While these
Motions were pending, Plaintiffs stopped participating in
this action, resulting in its dismissal with prejudice.
See 2012 WL 612463, at *3 (D. Haw. Feb. 24, 2012).
This dismissal was affirmed on appeal, and the mandate issued
on June 16, 2014. Doc. No. 175.
84760, at *3 (D. Haw. Jan. 7, 2015), aff'd, 694
Fed.Appx. 492 (9th Cir. 2017). The Ninth Circuit affirmed the
district court's dismissal with prejudice of the First
Lawsuit. 554 Fed.Appx. 555 (9th Cir. 2014).
The Second Lawsuit
Second Lawsuit, the Aminas filed their original complaint
against Bank of New York Mellon (“BONY”) on
November 28, 2011, their First Amended Complaint on June 5,
2012, and their Second Amended Complaint adding U.S. Bank
N.A. as a defendant on October 19, 2012. After motions
practice, the issue on summary judgment in the Second Lawsuit
was narrowed to “whether Plaintiffs entered into the
mortgage loan at issue, ” and its validity. 2015 WL
84760, at *4 (D. Haw. Jan. 7, 2015). The district court's
order granting defendants' motion for summary judgment
found both that the Mortgage was validly transferred to U.S.
Bank and also that the Aminas were not entitled to quiet
title. The district court explained the Mortgage transactions
at issue in the litigation:
Throughout the pendency of both the First Action and this
action, there was no dispute that Plaintiff entered into two
mortgage loans on the subject property with WMC in 2006. (The
mortgage loan for $220, 000 has been released, leaving the
one for $880, 000 at issue.) Indeed, the Complaint in the
First Action (which included WMC as a Defendant) recited that
Plaintiffs entered into these two mortgage loans with WMC,
and asserted claims based upon alleged improprieties by WMC
and WMC's loan documents. See Civ. No. 10-00165
JMS-KSC, Doc. No. 1, Compl. ¶¶ 38-81. And in this
action, the parties have focused not on whether Plaintiffs
ever entered into mortgage loans on the subject property, but
rather whether these mortgage loans were transferred to U.S.
Bank. See, e.g., 2012 WL 3283513, at *5 (explaining
that Plaintiffs assert “that Defendant is not a
mortgagee and that there is no record evidence of any
assignment of the mortgage loan to Defendant”); 2013 WL
1385377, at *3 (same).
84760, at *4. Turning to the merits of the claims, the
district court determined that “U.S. Bank is the
mortgagee on the mortgage loan on the subject property,
” based upon the following evidence in the summary
Defendants have presented evidence that in June 2006,
Plaintiffs' mortgage loan was transferred to JP Morgan
Trust pursuant to the PSA, as is shown in the Mortgage Loan
Schedule for the JP Morgan Trust listing Plaintiffs'
mortgage loan. See Doc. No. 141-1, Alegria Decl.
¶¶ 5-6; Doc. No. 142-2, Defs.' Ex. D (PSA);
Doc. No. 158, Defs.' Ex. E at 1, 43 (loan schedule).
Plaintiffs' $880, 000 mortgage loan is identified in the
Loan Schedule by the Loan ID number ****1019, which also
appears on the upper left-hand corner of the note and
mortgage. Doc. No. 141-1, Alegria Decl. ¶ 6; see
also Doc. No. 158, Defs.' Ex. E at 1, 43; Doc. No.
142-1, Defs.' Ex. C (Balloon Note for $880, 000); Doc.
No. 141-5, Defs.' Ex. B (mortgage on subject property
referring to Balloon Note for $880, 000). Further, on April
4, 2012, an assignment of mortgage from MERS, as nominee for
WMC, its successors, and assigns, to U.S. Bank (again, as
trustee for the JP Morgan Trust), was recorded in the Hawaii
Bureau of Conveyances. See Doc. No. 142-4,
Defs.' Ex. F. Finally, Defendants present a copy of the
Note, endorsed in blank, and Alegria asserts that JP Morgan
Chase has possession of it. Doc. No. 141-1, Alegria Decl.
¶ 4; Doc. No. 142-1, Defs.' Ex. C. This evidence
supports the conclusion that U.S. Bank is the mortgagee on
the mortgage loan on the subject property.
84760, at *6. The court rejected the Aminas' challenge to
the validity of the transfer based upon the various
assignments of the Mortgage and the Pooling and Servicing
it is well-established that a borrower, who is a third party
to the PSA and assignment, lacks standing to challenge their
validity. . . . Plaintiffs are not parties to either of them,
and therefore do not have standing to challenge them. See
also Abubo v. New York Mellon, 2011 WL 6011787, at *8
(D. Haw. Nov. 30, 2011) (rejecting argument that assignment
is invalid on two bases “(1) because a third party
lacks standing to raise a violation of a PSA, or (2) because
noncompliance with terms of a PSA is irrelevant to the
validity of the assignment (or both)”); Nottage v.
Bank of New York Mellon, 2012 WL 5305506, at *5 (D. Haw.
Oct. 25, 2012) (same); Benoist v. U.S. Bank Nat'l
Ass'n, 2012 WL 3202180, at *5 (D. Haw. Aug. 3, 2012)
84760, at *8-9. Upon granting defendants' motion for
summary judgment, the court entered judgment and closed the
case. The Ninth Circuit affirmed the district court's
rulings on the motions to dismiss and for summary judgment.
694 Fed.Appx. 492, 494 (9th Cir. 2017).
Plaintiffs' Current Action
March 15, 2018, the Aminas initiated this civil action
against the Chase Defendants, MERS, and WMC, attacking the
same Mortgage as the prior lawsuits: “On 3/6/2006,
[the] Mortgage was recorded with the State of Hawaii Bureau
of Conveyances as Document No. 2006-042511. Plaintiffs never
applied for the loan described in the Note which was filed as
Document No. 142-1 and as Document 144-4 in Case No.
1:11-cv-00714 JMS-BMK.” Compl. ¶¶ 225-226.
They again challenge the Assignment of Mortgage:
244. Taking the Alegria Declaration to be true, after June,
2006, and specifically on 3/22/2012, the Loan no longer
belonged to any successor or assign of WMC Mortgage Corp.
245. Therefore, the ASSIGNMENT OF MORTGAGE is invalid and
void for lack of authority. You can't sell something you
246. The Assignment was created and recorded during
litigation - specifically, Case No. 11-00714 JMS-BMK in the
USDC Hawaii, which was filed on 11/28/2011.
Aminas allege eight causes of action in their 479-paragraph
Complaint, each directed at voiding their loan on the
Property or invalidating Defendants' rights under the
Mortgage and Note. The Complaint also seeks to distinguish
this case from the prior litigation, despite referring
extensively to the facts and documents underlying the First
and Second Lawsuits:
1. New facts exist since the date of filing of the most
recent lawsuit. . . .
2. This lawsuit is against different parties than the most
3. None of the Defendants is the (or a) mortgagee [sic]. ****
7. The Mortgage recorded as Document No. 2006-042511 and the
Note which was filed as Document No. 142-1 (and also as
Document 144-4) in Case No. 1:11-cv-00714 JMS-BMK will be
collectively referred to as “the disputed loan”
or “the loan in dispute.”
8. Plaintiffs are interested in the Pooling and Servicing
Agreement (PSA), not because of any attempt to
“challenge” it or to hold parties to account for
breaking its terms, but for the purpose of identifying the
true owner of the disputed loan.
9. Plaintiffs seek declaratory judgment that none of the
Defendants may foreclose, because only the original
beneficiary of a deed of trust or its assignee or agent may
direct the trustee to sell the property.
10. Plaintiffs made payments to CHASE that were not credited
to Plaintiffs' account and were not forwarded to the
11. Unlike in most cases, Plaintiffs have standing to
challenge the validity of the Assignment because, if the
Assignment is not valid, then the proper party has fully been
paid off, and Plaintiffs are not in default.
other relief, the Complaint asks that the Court declare that
“Plaintiffs have clear title to the property, free from
any encumbrances by Defendants, and that Defendants have no
valid security interest in Plaintiffs' property.”
Compl. ¶ 475. Plaintiffs also seek to enjoin all
Defendants from “selling, assigning or transferring
mortgages or obligations relating to the [Property]; from
instituting, prosecuting or maintaining nonjudicial or
judicial foreclosure proceedings against the [Property],
” Compl. ¶ 475, or “otherwise taking any
steps to deprive Plaintiffs of ownership and/or enjoyment of
their home.” Id.
Defendants and MERS seek dismissal of the Complaint based
upon claim and issue preclusion principles or, alternatively,
because the Aminas' claims are both time-barred and fail
to state plausible claims for relief. NTC filed a substantive
joinder asking that the Complaint be dismissed with
Motion To Dismiss Under Rule 12(b)(6)
Rule of Civil Procedure 12(b)(6) authorizes the Court to
dismiss a complaint that fails “to state a claim upon
which relief can be granted.” Rule 12(b)(6) is read in
conjunction with Rule 8(a), which requires “a short and
plain statement of the claim showing that the pleader is
entitled to relief.” Fed.R.Civ.P. 8(a)(2). The Court
may dismiss a complaint either because it lacks a cognizable
legal theory or because it lacks sufficient factual
allegations to support a cognizable legal theory.
Balistreri v. Pacifica Police Dep't., 901 F.2d
696, 699 (9th Cir. 1988). Pursuant to Ashcroft v.
Iqbal, “[t]o 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.'” 555 U.S. 662, 678 (2009) (quoting
Bell Atlantic Corp. v. Twombly, 550 U.S. 554, 570
(2007)). “[T]he tenet that a court must accept as true
all of the allegations contained in a complaint is
inapplicable to legal conclusions.” Id.
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). Rather, “[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).
Factual allegations that only permit the court to infer
“the mere possibility of misconduct” do not
constitute a short and plain statement of the claim showing
that the pleader is entitled to relief as required by Rule
8(a)(2). Id. at 679.
district court may consider the affirmative defenses of claim
or issue preclusion on a Rule 12(b)(6) motion to
dismiss.” Fairbank v. Underwood, 986 F.Supp.2d
1222, 1231 n.5 (D. Or. 2013); Thompson v. Cty. of
Franklin, 15 F.3d 245, 253 (2d Cir. 2004) (noting that
res judicata challenges may be considered in a
motion to dismiss for failure to state a claim under Rule
12(b)(6)); Scott v. Kuhlmann, 746 F.2d 1377, 1378
(9th Cir. 1984) (res judicata properly raised in
motion to dismiss when there are no disputed issues of fact);
Day v. Moscow, 955 F.2d 807, 811 (2d Cir. 1992)
(res judicata may be sustained on a Rule 12(b)(6)
motion when relevant facts are shown by court records);
see also Rainwater v. Banales, 2008 WL 5233138, at
*9 n.6 (C.D. Cal. 2008) (leave to amend may be denied as
futile when the claims would be barred by res
judicata or collateral estoppel).
may consider certain documents attached to a complaint, as
well as documents incorporated by reference in the complaint,
or matters of judicial notice, without converting a Rule
12(b)(6) motion to dismiss into a motion for summary
judgment. United States v. Ritchie, 342 F.3d 903,
908-09 (9th Cir. 2003). As noted above, the Court takes
judicial notice of the pleadings, court orders, and other
public records attached ...