Opinion
2:23-cv-02242 WBS DB
02-12-2024
ROBERT MCBRIDE, an individual, Plaintiff, v. PHH MORTGAGE CORPORATION, a limited liability company, and DOES 1 through 20, inclusive, Defendant.
TEMPORARY RESTRAINING ORDER
William B. Shubb, United States District Judge
Plaintiff Robert McBride moves for a temporary restraining order to enjoin a trustee's sale of his home, currently scheduled for Tuesday, February 13, 2024. (Docket No. 14). The court heard oral arguments on the motion on February 12, 2024. Brooke Brewer, Esq., appeared on behalf of plaintiff; and Neil Cooper, Esq., appeared on behalf of defendant.
“The purpose of a temporary restraining order is to preserve the status quo pending the complete briefing and thorough consideration contemplated by full proceedings pursuant to a preliminary injunction.” Occupy Sacramento v. City of Sacramento, No. 2:11-CV-02873-MCE, 2011 WL 5374748, at *3 (E.D. Cal. Nov. 4, 2011) (citing Granny Goose Foods, Inc. v. Teamsters, 415 U.S. 423, 438-39 (1974) (temporary restraining orders “should be restricted to serving their underlying purpose of preserving the status quo and preventing irreparable harm just so long as is necessary to hold a hearing, and no longer”); Reno Air Racing Ass'n. v. McCord, 452 F.3d 1126, 1131 (9th Cir. 2006); Dunn v. Cate, No. CIV 08-873-NVW, 2010 WL 1558562, at *1 (E.D. Cal. Apr. 19, 2010).
In order to obtain a temporary restraining order or preliminary injunction, the moving party must establish (1) it is likely to succeed on the merits, (2) it is likely to suffer irreparable harm in the absence of preliminary relief, (3) the balance of equities tips in its favor, and (4) an injunction is in the public interest. Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 20-21 (2008); Humane Society of the U.S. v. Gutierrez, 558 F.3d 896, 896 (9th Cir. 2009); Credit Bureau Connection, Inc. v. Pardini, 726 F.Supp.2d 1107, 1132 (E.D. Cal. 2010) (standards for temporary restraining orders and preliminary injunctions are the same).
I. Likelihood of Success on the Merits
Here, plaintiff alleges violations of the Homeowner Bill of Rights (“HBOR”), California Civil Code §§ 2923.6 and 2923.7, and the Unfair Competition Law (“UCL”).
Section 2923.6 prohibits “dual tracking,” in which a lender proceeds with the foreclosure process while reviewing a loan modification application. See Cal. Civ. Code § 2923.6(c). “If a borrower submits a complete application for a first lien loan modification offered by, or through, the borrower's mortgage servicer, a mortgage servicer . . . shall not record a notice of default, or conduct a trustee's sale, while the complete first lien loan modification application is pending.” Id. Section 2923.6(d) further provides that the “borrower shall have at least 30 days from the date of the written denial to appeal the denial and to provide evidence that the mortgage servicer's determination was in error.” Id. § 2923.6(d).
Section 2923.6(c)-(d) thus “prohibits recording a notice of default or sale and conducting that sale” while a loan modification application is pending. Marquez v. U.S. Bank, N.A., Case No. CV16-06658 JAK (Ex), 2016 WL 2885857, at *7 (N.D. Cal. May 16, 2016); see Shupe v. Nationstar Mortg. LLC, Civ. 231 F.Supp.3d 597, 602, (E.D. Cal. Jan. 31, 2017) (England, J.) (“California Civil Code § 2923.6 places restrictions on the recording of Notices of Default or Notices of Trustee's Sale while a loan modification application is pending.”)
The parties dispute whether plaintiff's several past applications for a loan modification checked all the boxes as to be actually “complete.” However, neither party disputes that plaintiff submitted a completed application on October 13, 2023. (Schwiner Decl. (Docket No. 18) ¶ 31.) On December 6, 2023, defendant alleges that it approved this application and sent plaintiff a Trial Period Plan (“TPP”) offer letter. (Id. Ex. 32.) However, this offer appears to be contingent on plaintiff accepting a settlement offer and permanently releasing their claims in this lawsuit.Because of the conditional nature of the TPP offer and the fact that the TPP offer letter itself does not reference plaintiff's October 13, 2023 application, the court cannot conclude that the offer defendant extended on December 6, 2023 is a final, written decision based strictly on the merits of plaintiff's October 13, 2023 application.
Defendant only included the TPP offer in their moving papers, which they described as “the relevant pages of the TPP.” (Schwiner Decl. ¶ 31.) However, at oral argument, defendant's counsel provided the court with a copy of a proposed settlement agreement that includes the TPP offer as an exhibit. It therefore appears that plaintiff was never presented with a standalone TPP offer that did not also require them to settle this case.
Accordingly, the court concludes that plaintiff shows a likelihood of success at least as to his Section 2923.6 claim. This is sufficient to satisfy the first Winter prong.
II. Irreparable Harm
The foreclosure of plaintiff's home conclusively constitutes irreparable harm. See Park Village Apt. Tenants Ass'n v. Mortimer Howard Trust, 636 F.3d 1150, 1159 (9th Cir. 2011) (“loss of an interest in real property constitutes an irreparable injury”); Sundance Land Corp. v. Community First Fed'l Sav. & Loan Ass'n, 840 F.2d 653, 661 (9th Cir. 1988). Plaintiff therefore satisfies the second Winter factor.
III. Balance of Equities
The balance of equities also favors plaintiffs. While plaintiff will lose his home if the court were to deny the request, if the court is to grant the request defendants will need to postpone the foreclosure, which they have already done at least once in the past. There is injury and inconvenience on both sides, but the balance of it lies with plaintiff, and therefore cuts in favor of a temporary injunction. See Andrews v. City of San Bernardino, 346 P.2d 457, 463 (Cal.App. 4th Dist. 1959) (trial court's discretion to grant or deny a preliminary injunction should be exercised in favor of the party most likely to be injured).
IV. Public Interest
The public has a strong interest in foreclosure sales being conducted according to the letter and the spirit of the law. The public also has an interest in meritorious claims being fully tested by argument and evidence. Accordingly, the court concludes that the public interest also militates towards granting plaintiff's request.
IT IS THEREFORE ORDERED that plaintiff's ex parte application for a temporary restraining order (Docket No. 14) be, and the same hereby is, GRANTED. Defendant is hereby temporarily enjoined from conducting a trustee's sale on the property located at 3650 Coyote Road, West Sacramento California, pending further Order of this court.