Opinion
Case No. EDCV 15-00267-VAP (KKx)
06-01-2015
LAURA COLEMAN BIGGS v. BANK OF AMERICA CORPORATION, ET AL.
PRIORITY SEND
CIVIL MINUTES -- GENERAL
PRESENT: HONORABLE VIRGINIA A. PHILLIPS, U.S. DISTRICT JUDGE Marva Dillard
Courtroom Deputy None Present
Court Reporter ATTORNEYS PRESENT FOR
PLAINTIFFS: None ATTORNEYS PRESENT FOR
DEFENDANTS: None PROCEEDINGS: MINUTE ORDER GRANTING MOTIONS TO DISMISS (DOC. NOS. 19, 21) (IN CHAMBERS)
George Mitchell obtained a residential real estate loan to purchase a house in 2000. Unbeknownst to his wife at the time, he had also secured a life insurance policy that would pay off most of that loan in the event of his death. The loan and insurance policy payments were combined into a single monthly payment that Mr. Mitchell made until he died in 2003. After Mr. Mitchell's death, his widow, Plaintiff Laura Coleman Biggs, continued making the combined payments for the residential loan and life insurance policy, unaware of the latter component of the payment.
Plaintiff alleges she told Defendant Bank of America Corporation ("BAC") and Defendant SPS about Mr. Mitchell's death, but they continued to accept her payments, and then attempted to foreclose on her house when she defaulted on the loan nearly a decade later. Eventually, the life insurance was paid to Plaintiff, and she now has clear title to the house - but not before she suffered a decade's worth of financial struggle and emotional distress. She therefore filed this lawsuit. (See Doc. No. 1 ("Complaint").)
References to "SPS" in this Order include both Defendants Select Portfolio Servicing, Inc. and SPS Holding Company.
This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1332. (See Complaint ¶ 4.)
On April 14, 2015, BAC filed a Motion to Dismiss (see Doc. No. 19 ("BAC Mot.")), as did Defendant American Bankers Life Insurance Company of Florida ("American Bankers") (see Doc. No. 21 ("Am. Bankers Mot.")). Both Motions were set for hearing on May 18, 2015. Plaintiff filed Oppositions (see Doc. No. 24 ("Am. Bankers Opp."); Doc. No. 25 ("BAC Opp.")), and Defendants replied (see Doc. No. 28 ("BAC Reply"); Doc. No. 29 ("Am. Bankers Reply")). The Court vacated the May 18, 2015 hearing, finding the Motions appropriate for resolution without a hearing. See Fed. R. Civ. P. 78; L.R. 7-15.
Defendant SPS has not yet responded to the Complaint.
After considering the papers filed in support of, and in opposition to, the Motions, the Court GRANTS the Motions, and GRANTS Plaintiff leave to amend IN PART.
I. BACKGROUND
A. Allegations in the Complaint
Plaintiff Laura Coleman Biggs married George Mitchell (a.k.a. Kenneth Walter Biggs) in 1971. (Complaint ¶ 21.) Mr. Mitchell financed the purchase of a house on West Valencia Street in Rialto, California ("the Property") on February 29, 2000, with a $134,446.70 loan from Countrywide Financial Corporation ("Countrywide"). (Id. ¶¶ 22-23.) He secured that loan with a deed of trust on the Property. (Id. ¶ 23.) Defendant BAC later acquired Countrywide, and at some point after, Defendant SPS became the loan servicer. (Id. ¶¶ 40, 44.) Plaintiff alleges BAC is responsible for all of SPS's "wrongful and improper conduct" because it acted as BAC's agent. (Id. ¶¶ 51, 56.)
BAC states in its Motion that it is an improper party because it is not the successor in interest to Countrywide or Nationscredit, the original loan servicer. (BAC Mot. at 2 n.2, n.3.) BAC "reserves the right to raise the defense of improper party at a later time." (Id.)
At the same time he obtained the loan, Mr. Mitchell also obtained a $100,000 life insurance policy from Defendant American Bankers. (Id. ¶ 27.) The insurance certificate lists NationsCredit "and/or It's [sic] Affiliates" as the "First Credit Beneficiary." (Id.) NationsCredit was the original loan servicer. (Id. ¶ 44.)
The policy was structured this way so that its proceeds would pay off the loan secured by the Property in the event of Mr. Mitchell's death. (Id. ¶ 29.) Plaintiff was not aware that Mr. Mitchell had obtained this life insurance policy. (Id. ¶ 30.)
Both the loan and life insurance payments had been combined into a single monthly payment. (Id. ¶ 32.) Mr. Mitchell always made these payments on time until his death in 2003. (Id. ¶¶ 24, 28.) At that point, the principal balance on the loan was approximately $122,000, and the proceeds of the life insurance policy would have been $100,000. (Id. ¶ 38.)
Plaintiff contacted either BAC or the mortgage servicer shortly after Mr. Mitchell's death. (Id. ¶ 65.) She advised the representative with whom she spoke that her husband had died and that she wanted to transfer the account associated with the loan into her name. (Id.) The representative advised Plaintiff to continue making the same payments her husband had been making. (Id. ¶ 66.) The representative did not advise Plaintiff to take any other action and did not transfer the account into her name. (Id.)
When Plaintiff began making monthly payments, she did not realize they included payments for a life insurance policy on her now-deceased husband. (Id. ¶ 25.)
In 2005, Plaintiff contacted SPS, the loan servicer, because she was behind on her property tax payments. (Id. ¶ 70.) She told an SPS representative that she had been making the payments ever since her husband died. (Id. ¶ 71.) The representative told Plaintiff to continue making the monthly payments. (Id. ¶ 72.) On May 10, 2006, SPS added an escrow account to the loan so Plaintiff could pay her delinquent property taxes. (Id. ¶ 73.) Plaintiff borrowed money from her relatives to make the additional payments. (Id.) Plaintiff fell into more tax trouble in 2011, and again contacted SPS, but this time was told SPS would not speak with her about the loan because the account was not in her name. (Id. ¶¶ 76, 79-80.)
Plaintiff had continued making payments on the loan, but in 2012, SPS started to refuse her payments. (Id. ¶ 84.) She also had trouble making payments but received no assistance from BAC or SPS. (Id. ¶ 85.)
Plaintiff soon defaulted on the loan payments. (Id. ¶ 86.) BAC and SPS noticed a trustee's sale of the Property for October 1, 2013. (Id. ¶ 87.) Plaintiff tried to sell the Property to avoid foreclosure. (Id. ¶ 88.) She was unsuccessful, however, because no one from BAC or SPS would speak with her or assist her because her name was not on the loan account. (Id. ¶¶ 88-89.) Ultimately, Plaintiff retained an attorney and filed a petition for bankruptcy protection to prevent the trustee's sale. (Id. ¶¶ 91, 94.)
On March 25, 2014, Plaintiff filed an Affidavit of Surviving Spouse, which placed her name on the title to the Property and on the loan account. (Id. ¶ 98.) Through her attorney's efforts, BAC and SPS eventually acknowledged that Plaintiff was Mr. Mitchell's surviving spouse and that Mr. Mitchell had died. (Id. ¶ 97.)
Plaintiff provided BAC and SPS with information necessary to apply for a loan modification under the HAMP Program. (Id. ¶ 99.) BAC and SPS notified her that she would have to dismiss her bankruptcy case to proceed with a HAMP modification. (Id. ¶ 103.) Plaintiff therefore dismissed her bankruptcy case, thus dissolving the automatic stay and making it possible for the foreclosure to proceed. (Id.)
"The Home Affordable Mortgage Program ('HAMP'), 12 U.S.C. § 5219a, is a federal program whereby the United States government privately contracts with banks to provide incentives to enter into residential mortgage modifications." Nevada v. Bank of Am. Corp., 672 F.3d 661, 672 n. 1 (9th Cir. 2012).
On November 12, 2013, Plaintiff learned she was not entitled to a HAMP modification because the Property was not Mr. Mitchell's primary residence. (Id. ¶ 104.) Plaintiff alleges this reason for denying her a HAMP modification was "pretextual, as [Mr.] Mitchell had no primary residence at that time" because he had died. (Id.) The stay on the foreclosure proceedings removed, and Plaintiff's HAMP modification application denied, BAC and SPS set a new date for a trustee's sale. (Id. ¶ 107.)
On December 9, 2013, a news story ran detailing Plaintiff's saga. (Id. ¶ 109.) Within hours of that story, BAC and SPS contacted Plaintiff to inform her that a loan modification had been approved. (Id. ¶ 110.)
When Plaintiff received the loan documents, however, she learned it was not a HAMP modification as she had thought but a loan modification with a limited amount of time for acceptance, requiring her to pay over $30,000 in fees and other charges, and a "much higher" interest rate than a HAMP modification. (Id. ¶¶ 112-13.) Plaintiff declined the offer. (Id. ¶ 114.)
Now, for the first time, BAC and SPS asked Plaintiff for evidence to establish that Mr. Mitchell and Kenneth Biggs were the same person. (Id. ¶ 115.) On December 18, 2013, Plaintiff provided this evidence. (Id. ¶ 116.) Plaintiff also requested and received a breakdown of her monthly payments from the last decade. (Id. ¶ 117.) This breakdown showed that she had been making monthly payments on both the loan and on the life insurance policy since Mr. Mitchell's death. (Id. ¶ 118.) She requested that the proceeds of that insurance policy be paid. (Id. ¶ 124.)
In early 2014, Defendant American Bankers was advised for the first time of the death of Mr. Mitchell and that a demand was being made for payment of the insurance proceeds. (Id. ¶ 126.) American Bankers did not pay the insurance proceeds in a timely and reasonable manner. (Id. ¶ 127.) Its first payment to Plaintiff was short; it only paid the full amount after being contacted by Plaintiff's attorney. (Id. ¶ 128.)
Also in January 2014, Plaintiff alleges the Property's roof was damaged, and that BAC did not release insurance proceeds to her so she could fix the roof until April 2014. (Complaint ¶¶ 120-23.)
Plaintiff now has clear title to the Property. (Id. ¶ 130.)
B. Request for Judicial Notice
Both BAC and American Bankers filed requests for judicial notice. (See Doc. No. 20; Exhibits attached to Am. Bankers Mot.). The Court GRANTS BAC's request, but DENIES American Bankers' request as MOOT.
1. BAC's Request
BAC requests that the Court take judicial notice of two documents. (See Doc. No. 20.) One is the Deed of Trust related to the subject property, dated February 29, 2000, and recorded in the San Bernardino County Recorder's Office. (See id., Exh. A ("DOT").) The Court GRANTS BAC's request for judicial notice of the DOT because it is a matter of public record. See Fed. R. Evid. 201; Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir. 2001) ("[U]nder Fed. R. Evid. 201, a court may take judicial notice of matters of public record.").
The other document is a Promissory Note for a loan dated February 29, 2000. (See Doc. No. 20, Exh. B ("Promissory Note").) Plaintiff's claims "necessarily rel[y]" on this document since she alleges wrongdoing in connection with the loan, and Plaintiff does not challenge its authenticity. See Lee, 250 F.3d at 688 ("If the documents are not physically attached to the complaint, they may be considered if the documents' authenticity is not contested and the plaintiff's complaint necessarily relies on them."). The Court, therefore, GRANTS BAC's request for judicial notice of the Promissory Note.
2. American Bankers' Request
American Bankers requests judicial notice of several documents. The Court, however, resolves its Motion in its favor without considering these documents. It therefore DENIES American Bankers' request for judicial notice as MOOT.
II. LEGAL STANDARD
Federal Rule of Civil Procedure 12(b)(6) allows a party to bring a motion to dismiss for failure to state a claim upon which relief can be granted. Rule 12(b)(6) is read in conjunction with Rule 8(a), which requires only a short and plain statement of the claim showing that the pleader is entitled to relief. Fed. R. Civ. P. 8(a)(2); Conley v. Gibson, 355 U.S. 41, 47 (1957) (holding that the Federal Rules require that a plaintiff provide "'a short and plain statement of the claim' that will give the defendant fair notice of what the plaintiff's claim is and the grounds upon which it rests" (quoting Fed. R. Civ. P. 8(a)(2))); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). When evaluating a Rule 12(b)(6) motion, a court must accept all material allegations in the complaint — as well as any reasonable inferences to be drawn from them — as true and construe them in the light most favorable to the non-moving party. See Doe v. United States, 419 F.3d 1058, 1062 (9th Cir. 2005); ARC Ecology v. U.S. Dep't of Air Force, 411 F.3d 1092, 1096 (9th Cir. 2005); Moyo v. Gomez, 32 F.3d 1382, 1384 (9th Cir. 1994).
"While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitlement to relief' requires 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 (citations omitted). Rather, the allegations in the complaint "must be enough to raise a right to relief above the speculative level." Id.
To survive a motion to dismiss, a plaintiff must allege "enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570; Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009). "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. 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.'" Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 556). The Ninth Circuit has clarified that (1) a complaint must "contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively," and (2) "the factual allegations that are taken as true 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." Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011).
III. DISCUSSION
Plaintiff asserts the following nine claims against Defendants: (1) Violation of California Business & Professions Code, § 17200, et seq.; (2) Violation of California's Consumer Legal Remedies Act, Cal. Civ. Code § 1750, et seq.; (3) Intentional Misrepresentation; (4) Negligent Misrepresentation; (5) Negligence; (6) Concealment; (7) Breach of the Implied Covenant of Good Faith and Fair Dealing; (8) Negligent Infliction of Emotional Distress; and (9) Intentional Infliction of Emotional Distress.
A. Plaintiff's Complaint Fails to Allege a Claim Against American Bankers
Plaintiff alleges that American Bankers "was advised of the death of Mr. Mitchell, and that a demand was being made for payment under the policy in early 2014." (Complaint ¶ 126.) American Bankers did not, however, "pay the proceeds of the policy in a timely and reasonable manner." (Id. ¶ 127.) Once American Bankers did agree to pay, "it failed to pay the entire face amount and only paid the full balance after being contacted by [Plaintiff's attorney]." (Id. ¶ 128; see also Am. Bankers Opp. at 8.)
"[T]he pleading standard Rule 8 announces does not require 'detailed factual allegations,' but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Iqbal, 556 U.S. 678 (quoting Twombly, 550 U.S. at 555)). Plaintiff's allegation that American Bankers did not pay her in a "timely or reasonable manner" is the sort of conclusory and unadorned allegation that Rule 8 guards against. (See Complaint ¶¶ 126-27.) Without factual allegations - i.e., the dates that a demand for payment was made to American Bankers, and the date it paid Plaintiff - Plaintiff's Complaint as to American Bankers fails.
Moreover, Plaintiff alleges that American Bankers "paid the full balance" - albeit, after some wrangling from her attorney. (Complaint ¶ 128.) It is not clear, therefore, upon what wrongdoing she bases her claims.
As Plaintiff's Complaint fails to comply with Rule 8's requirements, the Court GRANTS American Bankers' Motion.
B. Plaintiff's Claims Against BAC
In its Motion, BAC does not seek to dismiss all of Plaintiff's claims against it. It only seeks to dismiss her California's Consumer Legal Remedies Act, negligence, negligent infliction of emotional distress, and breach of the implied covenant of good faith and fair dealing claims.
1. Plaintiff Cannot Allege a Claim Under California's Consumer Legal Remedies Act ("CLRA")
BAC argues the Court should dismiss Plaintiff's CLRA claim because the CLRA does not apply to loan transactions.
The CLRA prohibits certain "unfair methods of competition and unfair or deceptive acts or practices undertaken by any person in a transaction intended to result or which results in the sale or lease of goods or services to any consumer." Cal. Civ. Code § 1770(a). It defines "goods" as "tangible chattels bought or leased for use primarily for personal, family, or household purposes." Cal. Civ. Code § 1761(a). It defines "services" as "work, labor, and services for other than a commercial or business use, including services furnished in connection with the sale or repair of goods." Cal. Civ. Code § 1761(b).
"There can be no dispute that a mortgage loan is not a 'good,' i.e., a tangible chattel." Sonoda v. Amerisave Mortg. Corp., No. 11-1803, 2011 WL 2690451, at *2 (N.D. Cal. July 8, 2011) (citing Fairbanks v. Superior Court, 46 Cal. 4th 56, 65 (2009)). The only question, therefore, is whether a loan transaction is a "service."
In Fairbanks, the California Supreme Court held that a life insurance policy is not a "service" under the CLRA because "[a]n insurer's contractual obligation to pay money under a life insurance policy is not work or labor, nor is it related to the sale or repair of any tangible chattel." 46 Cal. 4th at 61, 92. Courts have extended this reasoning to loan transactions: "If a contractual obligation to pay money (under an insurance contract) is not a service, then neither is a contractual obligation to lend money." Sonoda, 2011 WL 2690451, at *2; see also, e.g., Young v. Wells Fargo & Co., 671 F. Supp. 2d 1006, 1025-26 (S.D. Iowa 2009); Alborzian v. JPMorgan Chase Bank, N.A., 235 Cal. App. 4th 29, 40 (2015) (noting that Fairbanks seems to have resolved any doubt about whether lenders provide a "service" as defined by the CLRA in the negative); cf. Benedict v. Wells Fargo Bank, N.A., No. 14-770, 2014 WL 2957753, at *3 (C.D. Cal. June 30, 2014) ("[T]he Court cannot reconcile Plaintiff's arguments concerning loan modification with Fairbanks' reasoning, and other courts haven't been able to either."); Justo v. Indymac Bancorp., No. 9-116, 2010 WL 623715, at *3 (C.D. Cal. Feb. 19, 2010) (same).
Plaintiff concedes this point but contends that, even after Fairbanks, courts continue to distinguish between transactions involving just a loan, and transactions "where additional services are provided." (BAC Opp. at 9.) Plaintiff's argument relies on Rex v. Chase Home Fin. LLC, 905 F. Supp. 2d 1111 (C.D. Cal. 2012). In Rex the court dismissed a CLRA claim but noted the CLRA may apply to a real estate transaction "where the lenders' interaction with the borrower goes beyond a contract to exten[d] credit." 905 F. Supp. 2d at 1156-57. Plaintiff alleges various additional services beyond the loan transaction here, "includ[ing] the financial services of managing th[e] loan, issuing a life insurance policy, [and] accepting payments of the mortgage and life insurance policy." (Complaint ¶ 183.) She argues these additional services render the loan transaction a "service" under the CLRA.
Although Rex analyzed Fairbanks, courts have found Rex's analysis unpersuasive because it relies on pre-Fairbanks cases. See Gerbitz v. ING Bank, FSB, 967 F. Supp. 2d 1072, 1079 (D. Del. 2013) ("While Rex cites to Fairbanks in its analysis, it ultimately relies on cases that predate Fairbanks."); Alborzian, 235 Cal. App. 4th at 40. This Court, too, finds Rex unpersuasive in light of Fairbanks.
Fairbanks makes clear that "ancillary services, including maintenance or other customer services," do not transform a loan transaction into a "service." Gerbitz, 967 F. Supp. 2d at 1080; see Fairbanks, 46 Cal. 4th at 65 (holding "the work or labor of insurance agents and other insurance company employees in helping consumers select policies that meet their needs, in assisting policyholders to keep their policies in force, and in processing claims are [not] services . . . sufficient to bring life insurance within the reach of the [CLRA]."). The Fairbanks Court broadly noted that "the sellers of virtually all intangible goods - investment securities, bank deposit accounts and loans, and so forth [-] . . . often provide additional customer services related to the maintenance, value, use, redemption, resale, or repayment of the intangible item." Id. Including as "services" all intangible goods that provide ancillary services would "defeat the apparent legislative intent" of limiting the CLRA's application. Id.
The California Supreme Court in Fairbanks addressed and foreclosed Plaintiff's argument that the CLRA applies to BAC's ancillary services in connection with the loan. The Court, therefore, GRANTS BAC's Motion to dismiss Plaintiff's CLRA claim.
2. The Court Dismisses Plaintiff's Negligence Claim
Plaintiff alleges BAC acted negligently in its dealings "with regard to the servicing of the mortgage at issue, the payment of the proceeds of the life insurance policy at issue[,] and in other ways." (Complaint ¶ 218.) To state a negligence claim, Plaintiff must allege (1) that BAC owed her a duty of care, (2) it breached that duty, and (3) the breach proximately caused her damages or injuries. Thomas v. Stenberg, 206 Cal. App. 4th 654, 662 (2012).
The threshold requirement - and the requirement BAC argues Plaintiff fails to establish - is whether BAC owed Plaintiff a duty of care. (See BAC Mot. at 7-8.) As BAC points out, California's courts have tended to follow the general rule that "a financial institution owes no duty of care to a borrower when the institution's involvement in the loan transaction does not exceed the scope of its conventional role as a mere lender of money." Nymark v. Heart Fed. Savings & Loan Ass'n, 231 Cal. App. 3d 1089, 1096 (1991). That rule applies in this case.
It is true that "[e]ven when the lender is acting as a conventional lender, the no-duty rule is only a general rule." Jolley v. Chase Home Fin., LLC, 213 Cal. App. 4th 872, 901 (2013); see also Yau v. Deutsche Bank Nat'l Trust Co. Americas, 525 F. App'x 606, 608-09 (9th Cir. 2013); Golden v. Bank of Am., N.A., No. 13-8411, 2015 WL 476281, at *4 (C.D. Cal. Feb. 5, 2015) ("The Nymark rule, however, is not absolute."). Therefore, California courts often "employ a six factor test to determine whether a financial institution owes a duty of care to a borrower." Id.
The six factors courts apply are (1) the extent to which the transaction was intended to affect the plaintiff, (2) the foreseeability of harm to the plaintiff, (3) the degree of certainty that the plaintiff suffered injury, (4) the closeness of the connection between the defendant's conduct and the injury suffered, (5) the moral blame attached to the defendant's conduct, and (6) the policy of preventing future harm. See Jolley, 213 Cal. App. 4th at 899 (citing Biakanja v. Irving, 49 Cal.2d 647, 650 (1958)).
Applying these factors, the Court finds Plaintiff fails to allege that BAC owed her a duty of care. BAC did not issue the life insurance policy. It entered into the loan transaction with Mr. Mitchell - not Plaintiff. Although Plaintiff was Mr. Mitchell's wife, her name did not appear on the loan account or on the life insurance policy, so any harm to her was not foreseeable. In its capacity as a conventional lender, BAC offered Plaintiff a loan modification even though her name did not appear on the loan account. She declined. Under these facts, Plaintiff cannot allege that BAC owed her a duty of care. Her negligence claim against BAC is futile, and the Court therefore GRANTS BAC's Motion to dismiss Plaintiff's negligence claim.
3. The Court Dismisses Plaintiff's Negligent Infliction of Emotional Distress ("NIED") Claim As Well
BAC correctly points out that an NIED claim "is not an independent tort but the tort of negligence to which the traditional elements of duty, breach of duty, causation, and damages apply." Wong v. Tai Jing, 189 Cal. App. 4th 1354, 1377 (2010). As discussed above, Plaintiff has failed to allege a negligence claim. Accordingly, Plaintiff has not alleged the elements of an NIED claim either.
The Court GRANTS BAC's Motion to dismiss Plaintiff's NIED claim.
4. Breach of Implied Covenant of Good Faith and Fair Dealing
Under California law, a breach of the implied covenant of good faith and fair dealing arises where one party unfairly frustrates another's right to receive the benefits of a contract. See Guz v. Bechtel Nat'l, Inc., 24 Cal. 4th 317, 326-27 (2000). "Therefore, in order for a breach of implied covenant of good faith and fair dealing claim to survive, there must be an underlying contract." Hibu Inc. v. Lawrence, No. 13-333, 2013 WL 6190538, at *4 (C.D. Cal. Nov. 25, 2013).
To state a claim, "the specific contractual obligation from which the implied covenant of good faith and fair dealing arose must be alleged" in the Complaint. Id. Plaintiff fails to allege, however, on what specific contractual obligation she bases her breach of the implied covenant claim.
Morever, Plaintiff fails to allege the existence of an explicit or implicit contract with BAC or SPS. She merely alleges that "[a] contract existed between [her] and B[AC] and SPS." (Complaint ¶ 233.) The allegation is wholly conclusory, however, and does not meet Rule 8's requirements.
Plaintiff has therefore failed to allege a breach of the implied covenant of good faith and fair dealing. Whatever Plaintiff's arguments in her Opposition, they do not fix the shortcomings in her Complaint.
Accordingly, the Court GRANTS BAC's Motion to dismiss Plaintiff's breach of the implied covenant of good faith and fair dealing claim.
C. Leave to Amend
If the Court determines that a claim should be dismissed, it must then decide whether to grant leave to amend. Under Rule 15(a) of the Federal Rules of Civil Procedure, leave to amend "shall be freely given when justice so requires," bearing in mind "the underlying purpose of Rule 15 to facilitate decisions on the merits, rather than on the pleadings or technicalities." Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (en banc) (internal quotation marks and alterations omitted). When dismissing a claim, "a district court should grant leave to amend even if no request to amend the pleading was made, unless it determines that the pleading could not possibly be cured by the allegation of other facts." Id. at 1130 (quoting Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995) (internal quotation marks omitted)). Accordingly, leave to amend should be denied only when allowing amendment would unduly prejudice the opposing party, cause undue delay, be futile, or if the moving party has acted in bad faith. Leadsinger, Inc. v. BMG Music Publ'g, 512 F.3d 522, 532 (9th Cir. 2008).
Granting Plaintiff leave to amend her CLRA claim would be futile. The Court therefore DENIES leave to amend the CLRA claim as to both Defendants BAC and American Bankers.
Although the Court focused on BAC when discussing the CLRA claim above, that discussion applies with even greater force to American Bankers because it is an insurer. In any event, "Plaintiff does not oppose dismissal of [her CLRA claim] as to American Bankers." (Am. Bankers Opp. at 14.)
Granting Plaintiff leave to amend her negligence and NIED claims would also be futile as to BAC. The Court therefore DENIES leave to amend these claims as to Defendant BAC.
The Court GRANTS Plaintiff leave to amend her remaining claims.
IV. CONCLUSION
The Court DISMISSES Plaintiff's CLRA claim as to BAC and American Bankers WITH PREJUDICE. It also DISMISSES her negligence and NIED claims as to BAC WITH PREJUDICE.
As to her remaining claims, the Court GRANTS the Motions and GRANTS Plaintiff leave to amend. Plaintiff shall file an amended complaint by June 22, 2015.
IT IS SO ORDERED.