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Amina v. WMC Finance Co.

United States District Court, D. Hawaii

January 4, 2019

MELVIN KEAKAKU AMINA and DONNA MAE AMINA, Plaintiffs,
v.
WMC FINANCE CO., et al., Defendants.

          ORDER GRANTING THE CHASE DEFENDANTS' MOTION TO DISMISS THE FIRST AMENDED COMPLAINT WITH PREJUDICE

          DERRICK K. WATSON UNITED STATES DISTRICT JUDGE.

         On July 5, 2018, this Court entered an Order dismissing Plaintiffs' Complaint with limited leave to amend (“the July 5, 2018 Order”). Specifically, the Court granted Plaintiffs, Melvin Keakaku Amina and Donna Mae Amina (collectively, “the Aminas”), limited leave to amend three of their eight causes of action. The Court also told the Aminas that no new parties, claims, or legal theories would be permitted in any amended complaint. On August 20, 2018, the Aminas filed a First Amended Complaint (FAC). Therein, the Aminas amended the three causes of action that they were granted leave to amend. Because the Aminas have still failed to state a claim with respect to these three causes of action, they are DISMISSED. In addition, in the FAC, the Aminas re-pled three of the causes of action that they were not granted leave to amend and added a new party. Because the Aminas were not authorized to do this, those causes of action remain dismissed, and the new party is dismissed as well. Finally, because the Aminas have been provided with an opportunity to amend their claims in this case, and have failed to do so in a manner that states a claim and/or is consistent with the July 5, 2018 Order, this case is DISMISSED WITH PREJUDICE.

         BACKGROUND

         In the July 5, 2018 Order, the Court set forth a thorough factual and procedural background of the Aminas' allegations and claims in this action, as well as two other actions the Aminas have brought related to a Mortgage on their real property, located at 2304 Metcalf Street #2, Honolulu, Hawaii 96822 (“the Property”). See Dkt. No. 32 at 2-10. The Court need not re-state that which is already on the record, and assumes familiarity with the same. For present purposes, the Court picks up the background with the rulings in the July 5, 2018 Order.

         In their original Complaint, the Aminas brought claims against JPMorgan Chase Bank, N.A. (“the Chase Defendants” or “Chase”), [1] Mortgage Electronic Registration Systems, Inc. and MERSCORP Holdings, Inc. (collectively, “MERS”), Nationwide Title Clearing, Inc. (“NTC”), and WMC Finance Co.[2] (“WMC, ” and, collectively with Chase, MERS, and NTC, “Original Defendants”), asserting the following eight causes of action: (1) quiet title against all Original Defendants (Claim One); (2) violation of the Fair Debt Collection Practices Act (FDCPA) against Chase (Claim Two); (3) violation of the Real Estate Settlement Procedures Act (RESPA) against Chase; (4) an accounting against certain Chase Defendants (Claim Four); (5) violation of the Unfair and Deceptive Trade Practices Act under Hawaii Revised Statute Chapter 480 (UDAP) against Chase (Claim Five); (6) relief from judgment under Rule 60 of the Federal Rules of Civil Procedure against Chase (Claim Six); (7) violation of the Truth In Lending Act (TILA) against Chase (Claim Seven); and (8) declaratory judgment against all Original Defendants (Claim Eight).

         On motion from Chase, MERS, and NTC, the Court dismissed each of the Aminas' eight claims with limited leave to amend. Dkt. No. 32. Specifically, the Court ruled as follows. First, the Court dismissed Claim One with prejudice and without leave to amend because it was barred by res judicata, failed to state a claim, and, with respect to NTC, was barred by issue preclusion. Second, the Court dismissed Claims Two, Three, and Five with prejudice in part and without prejudice in part. The Court dismissed Claims Two, Three, and Five with prejudice and without leave to amend to the extent they related to the validity of the Mortgage on the Property or the assignment of the same. The Court dismissed Claims Two, Three, and Five without prejudice and with leave to amend to the extent they relied upon communications between the Aminas and Chase in 2017 because, although the Aminas failed to state a claim in any of those respects, amendment may have been possible. Third, the Court dismissed Claim Four because (i) to the extent it related to the validity of the Mortgage on the Property or the assignment of the same, it was barred by res judicata, and (ii) the Aminas request for an accounting sought only a remedy, without providing an independent cause of action supporting such relief. The Court explained that the Aminas could “seek this relief in connection with an appropriate claim in an amended pleading.” Fourth, the Court dismissed Claim Six with prejudice and without leave to amend because it was barred by res judicata and/or issue preclusion. Fifth, the Court dismissed Claim Seven with prejudice and without leave to amend because it was time-barred and any attempt to amend the claim would be futile. And sixth, the Court dismissed Claim Eight because the Aminas' request for declaratory or injunctive relief was not an independent cause of action.

         The Court then explained the limited leave to which amendment was granted. The Court explained that all claims barred by res judicata, issue preclusion, and/or a statute of limitations could not be re-alleged in any amended complaint. The Court further explained that the Aminas could attempt to amend only the specific deficiencies noted in the July 5, 2018 Order. The Court continued that no new or additional parties, claims, or legal theories would be permitted in any amended complaint.

         As such, the Aminas were granted leave to amend only Claims Two, Three and Five to the extent they relied upon communications with Chase in 2017. In addition, the Aminas could seek an accounting or declaratory or injunctive relief only to the extent such relief would be justified by an appropriate independent cause of action.

         On August 20, 2018, the Aminas filed the FAC. Dkt. No. 40. Therein, they bring claims against Chase, WMC, and Larry Schneider (Schneider, collectively with Chase and WMC, “Defendants”), [3] asserting the following six causes of action: (1) quiet title against all Defendants (Cause One);[4] (2) violations of the FDCPA against Chase (Cause Two); (3) a violation of RESPA against Chase (Cause Three); (4) an accounting against certain Chase Defendants (Cause Four); (5) a violation of UDAP against Chase (Cause Five); and (6) a violation of TILA against Schneider (Cause Six).

         On September 11, 2018, the Chase Defendants filed a motion to dismiss the FAC. Dkt. No. 43. Thereafter, the Aminas filed a response to the motion to dismiss, Dkt. No. 53, and the Chase Defendants filed a reply in support of their motion to dismiss, Dkt. No. 54. As of the date of this Order, Schneider has not appeared in this case, and the record does not reflect that the FAC has been served upon him.

         STANDARD OF REVIEW

         I. Motion To Dismiss Under Rule 12(b)(6)

         Federal 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). 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.'” 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). In addition, “the 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 show that the pleader is entitled to relief as required by Rule 8(a)(2). Id. at 679.

         A court 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 in the July 5, 2018 Order, the Court takes judicial notice of the pleadings, court orders, and other public records that have been submitted in this case. See Fed.R.Evid. 201(b); Lee v. City of Los Angeles, 250 F.3d 668, 688-89 (9th Cir. 2001).[5]

         II. Pro Se Status

         Because the Aminas are proceeding pro se, the Court liberally construes their filings. Eldridge v. Block, 832 F.2d 1132, 1137 (9th Cir. 1987). With that in mind, “[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).

         A court may, however, deny leave to amend due to undue delay or failure to cure deficiencies by amendments previously allowed or where further amendment would be futile. E.g., Gardner v. Martino, 563 F.3d 981, 990 (9th Cir. 2009); Leadsinger, Inc. v. BMG Music Publ'g, 512 F.3d 522, 532 (9th Cir. 2008).

         DISCUSSION

         The Chase Defendants move for dismissal of all causes of action asserted in the FAC with prejudice. The Court, first, addresses those causes of action that the Aminas were given limited leave to amend. The Court, then, addresses those matters in the FAC for which leave to amend was not granted.

         I. Cause Two - the FDCPA

         In their original Complaint, the Aminas alleged that the Chase Defendants violated the FDCPA by failing to respond within 30 days of a November 7, 2017 letter the Aminas sent requesting verification of a debt. In doing so, the Aminas did not identify the specific FDCPA provision that this conduct allegedly violated. For this and numerous other reasons, including that the Aminas contradicted their own assertions, the Court found that the allegations in the original Complaint failed to state a FDCPA claim.

         In the FAC, the Aminas allege nine different violations of the FDCPA. These nine alleged violations can be placed into three distinct groups, as three different communications the Aminas allegedly received between 2017 and 2018 are alleged to have violated the FDCPA in the same three ways. The three distinct groups involve: (1) alleged violations of Section 1692g[6] in that one or more of the Chase Defendants continued debt collection activities after the Aminas made a written request to verify a debt; (2) alleged violations of Section 1692e(14)[7] in that one or more of the Chase Defendants used a business, company, or organization name other than its or their true name when communicating with the Aminas; and (3) alleged violations of Section 1692e(8)[8] in that one or more of the Chase Defendants failed to communicate to credit bureaus that a debt was disputed.

         As the Court explained in the July 5, 2018 Order, “‘[t]here are four elements to an FDCPA cause of action: (1) the plaintiff is a ‘consumer' under 15 U.S.C. § 1692a(3); (2) the debt arises out of a transaction entered into for personal purposes; (3) the defendant is a ‘debt collector' under 15 U.S.C. § 1692a(6); and (4) the defendant violated one of the provisions contained in 15 U.S.C. §§ 1692a-1692o.' Wheeler v. Premiere Credit of North America, LLC, 80 F.Supp.3d 1108, 1112 (S.D. Cal. 2015) (citing Turner v. Cook, 362 F.3d 1219, 1226-27 (9th Cir. 2004)).”

         The Aminas have failed to allege that any of the Chase Defendants is a debt collector for purposes of the FDCPA.[9] Under the FDCPA, a “debt collector” is any person engaged “in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another.” 15 U.S.C. § 1692a(6). The FAC is devoid of any attempt to allege that any one of the Chase Defendants is a debt collector under the FDCPA. The FAC does not even make a conclusory assertion that one of the Chase Defendants is a debt collector, [10] let alone allege facts plausibly suggesting that one of the Chase Defendants engages in a business the principal purpose of which is debt collection or regularly collects debts owed to another. This is reason alone to find that the Aminas fail to allege any claim under the FDCPA. See id. § 1692e (prohibiting a debt collector from using false or misleading representations); id. § 1692g (requiring a debt collector to send a consumer written notice). Moreover, because the Aminas have been provided with an opportunity to correct the deficiencies with their FDCPA claims, and have failed to correct this basic part of a FDCPA claim, despite guidance provided by the Court, the Court DISMISSES WITH PREJUDICE the Aminas' FDCPA claims without leave to amend.

         So the record is more complete, the Court also addresses whether the Aminas have properly alleged a violation of any of the three ...


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