Opinion
CASE NO. C11-362RAJ
07-01-2011
RICK RISPOLI, Plaintiff, v. BANK OF AMERICA, Defendant.
ORDER
I. INTRODUCTION
This matter comes before the court on Defendant Bank of America's motion to dismiss (or, in the alternative, motion for a more definite statement) (Dkt. # 8). The Defendant requested oral argument, and the Plaintiff did not. The court finds this matter suitable for disposition on the basis of the parties' briefing and supporting evidence. For the reasons explained below, the court GRANTS the motion to dismiss (Dkt. # 8).
II. BACKGROUND
Plaintiff Rick Rispoli purchased property in Redmond, Washington, in July 2006. See Complaint ¶¶ 1-3. On approximately October 30, 2009, Mr. Rispoli refinanced his mortgage loan regarding the Redmond property through Defendant Bank of America. ¶ 12. The $250,215 refinance loan ("the Loan") was secured by a deed of trust on the Redmond property. ¶ 13. Mr. Rispoli has been in default since December 1, 2009. ¶ 15.
Hereinafter, this order refers to paragraphs in the Complaint (Dkt. # 1) using bare "¶" marks.
In November 2010, Mr. Rispoli sought a forensic loan analysis of his loans, and at that time discovered that Bank of America had, at the time of signing, failed to make certain disclosures required under the Truth in Lending Act ("TILA"). ¶¶20-26. On November 4, 2010, Mr. Rispoli wrote to Bank of America to request copies of his loan documentation. ¶ 28. Bank of America responded with a description of the loan payment history, but told Mr. Rispoli that it did not have the requested documents and suggested he obtain those documents from his closing agent or title company. ¶¶ 28-30.
In January and February 2011, Mr. Rispoli informed Bank of America that he was willing to "rescind" the loan and "tender" the property back to Bank of America. ¶¶ 31-35. Bank of America did not respond to Mr. Rispoli's offers of rescission and tender. ¶ 36.
Mr. Rispoli filed this lawsuit in March 2011, alleging claims against Bank of America for TILA violations, violations of the Real Estate Settlement Procedure Act ("RESPA"), breach of contract, slander of title, violations of the Fair Debt Collection Practices Act ("FDCPA"), violations of the Equal Credit Opportunity Act ("ECOA"), fraudulent inducement, and violations of the Washington Consumer Protection Act ("CPA"). Mr. Rispoli also requested a declaratory judgment and quiet title.
Bank of America has now filed a motion to dismiss or, in the alternative, a motion for a more definite statement.
III. ANALYSIS
A. Legal Standards.
When considering a motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6), "the court is to take all well-pleaded factual allegations as true and to draw all reasonable inferences therefrom in favor of the plaintiff." Wyler Summit P'ship v. Turner Broadcasting Sys., Inc., 135 F.3d 658, 663 (9th Cir. 1998). Facts alleged in the complaint are assumed to be true. See Lipton v. Pathogenesis Corp., 284 F.3d 1027, 1030 n.1 (9th Cir. 2002). The issue to be resolved on a motion to dismiss is whether the plaintiff is entitled to continue the lawsuit to establish the facts alleged, not whether the plaintiff is likely to succeed on the merits. See Marksman Partners L.P. v. Chantal Pharm. Corp., 927 F. Supp. 1297, 1304 (C.D. Cal. 1996).
A complaint must provide more than a formulaic recitation of the elements of a cause of action, and must assert facts that "raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 127 S. Ct. 1955, 1965 (2007). The Ninth Circuit has summarized Twombly's plausibility standard to require that a complaint's "non-conclusory 'factual content,' and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. Secret Service, 572 F.3d 962, 969 (9th Cir. 2009) (citing Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009)). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 129 S. Ct. at 1949.
B. The Plaintiff Agrees That Multiple Claims Should be Dismissed.
Mr. Rispoli argues that Bank of America breached a contract "when [it] took no action" regarding Mr. Rispoli's offer of rescission, but he does not identify any contract provision that required Bank of America to take any particular action. In fact, Mr. Rispoli's breach-of-contract allegations reference TILA, rather than any contract. See ¶¶ 43-46. Mr. Rispoli agrees that the cause of action for these contract-related claims should be dismissed. See Pltf.'s Opp'n at 7:1-2.
Mr. Rispoli also appears to acknowledge that his RESPA claim should be dismissed. In his Opposition, Mr. Rispoli addressed his RESPA claim in one sentence: "Mr. Rispoli will dismiss this claim after reviewing his claims he has." Pltf.'s Opp'n (Dkt. # 10) at 7. The court construes that convoluted sentence as an admission that his cause of action for RESPA violations is not viable, and thus finds that dismissal of that cause of action is appropriate.
Mr. Rispoli also agrees that his claims for slander of title and ECOA should be dismissed. See Pltf.'s Opp'n at 14:3.
C. The Plaintiff has Failed to State a Valid TILA Claim.
Mr. Rispoli contends that Bank of America violated TILA by failing to provide him with two original signed notices of right to cancel containing a correct rescission date and other information. ¶ 70. Bank of America contends that the TILA claim must be dismissed because, inter alia, TILA does not apply to Mr. Rispoli's Bank of America loan.
As support for its argument, Bank of America cites 15 U.S.C. § 1635(e)(2), which states that the TILA rescission statute does not apply to "a transaction which constitutes a refinancing or consolidation (with no new advances) of the principal balance then due and any accrued and unpaid finance charges of an existing extension of credit by the same creditor secured by an interest in the same property." Mr. Rispoli acknowledges that Bank of America was the identified as the lender in the October 23, 2009 deed of trust on his property, and describes the October 30, 2009 loan as a "refinance." See ¶¶ 4, 12.
Mr. Rispoli nonetheless argues that 15 U.S.C. § 1635(e)(2) does not bar his TILA claims because the loan was "originally with Countrywide." Even assuming this is true, Mr. Rispoli does not acknowledge that at the time he refinanced his loan, Bank of America was the existing lender. See ¶¶ 4, 12. Furthermore, Mr. Rispoli does not actually dispute the applicability of 15 U.S.C. § 1635(e)(2), but only contends that he could not locate this statute upon review of the United States Code. See Pltf.'s Opp'n at 8:5-9. The court's review of the United States Code does reveal such a provision, and the court finds that it bars Mr. Rispoli's rescission-related claims under TILA.
D. The Plaintiff has Failed to State a Claim for Quiet Title.
A quiet title claim against a mortgagee requires that a mortgagor requires an allegation that the mortgagor is the rightful owner to the property, i.e. that the mortgagor has paid an outstanding debt secured by the mortgage. See Kelley v. MERS, Inc., 642 F. Supp. 2d 1048, 1057 (N.D. Cal. 2009). Mr. Rispoli does not contend that he has paid his outstanding debt; instead, he acknowledges he has been in default since December 1, 2009. See ¶ 15. Thus, Mr. Rispoli cannot bring a claim for quiet title.
E. The Plaintiff has Failed to State a Claim for FDCPA Violations.
Though Mr. Rispoli contends that Bank of America "was acting as a debt collector" under the circumstances of this case (see Pltf.'s Opp'n at 14:5-7), as a matter of law a "debt collector" under the FDCPA cannot be a consumer's creditor. See Chapel v. MERS, Inc., 2010 WL 4622526 at *5 (W.D. Wash. Nov. 2, 2010) (citing Montgomery v. Huntington Bank, 346 F.3d 693, 698 (6th Cir. 2003)). See also 15 U.S.C. § 1692a(6)(F) (defining "debt collector" for FDCPA purposes). Under the applicable authority, Bank of America cannot be considered a "debt collector" for purposes of the FDCPA, Mr. Rispoli's unfounded contentions notwithstanding. Thus, the FDCPA claim must be dismissed.
F. The Plaintiff has Failed to Plead Fraudulent Inducement with Particularity.
The complaint includes two allegations in the section regarding fraudulent inducement and concealment:
149. The acts of defendant as described above amount to fraudulent inducement and concealment.According to Bank of America, these allegations lack the specificity required under Federal Rule of Civil Procedure 9(b). Rule 9(b)'s heightened pleading standard for claims sounding in fraud requires a plaintiff to plead the "who, what, when, where, and how" of the alleged fraud. See Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 2006 (9th Cir. 2003).
150. Plaintiff prays for rescission of the subject loan, repayment of all monies paid at closing and or related to his loan and as required under TILA.
In his Opposition, Mr. Rispoli argues:
Based on the materials provided in Plaintiff's declaration an argument is definitely made for potential fraud. Basically, [Bank of America] was hounding Mr. Rispoli and continually contacting him and making a variety of claims-most of which were unsustainable in an attempt to get Mr. Rispoli's money.Pltf.'s Opp'n at 14-15. The court construes that argument as a tacit admission that the allegations in the Complaint are insufficient.
If proven this would sustain a claim of fraudulent inducement.
But even if the court were to consider the facts alleged in Mr. Rispoli's declaration as proposed amendments, those allegations still fail to allege the basic elements of fraud. See Rispoli Decl. (Dkt. # 11). Mr. Rispoli has not identified a false statement that he relied upon to his detriment, let alone identify any damages resulting from that reliance. See Baertschi v. Jordan, 68 Wn.2d 478, 482 (1966) (setting out nine elements of a fraud claim, which include a representation of a false material fact and damages resulting from the plaintiff's reliance upon that representation).
Thus, Mr. Rispoli's allegations in the complaint are deficient, and his proposed amendments do not cure the deficiency. Thus, it appears that leave to amend another time (which Mr. Rispoli did not request) would be futile, and thus dismissal with prejudice is appropriate. See Allen v. City of Beverly Hills, 911 F.2d 367, 373-374 (9th Cir. 1990) (stating that a court may consider futility of amendment and whether a plaintiff has previously amended when considering whether to grant leave to amend a complaint).
G. The Plaintiff has Failed to Allege Facts Supporting at Least One Required Element of a CPA Claim.
There are five elements of a private CPA claim: "(1) an unfair or deceptive act or practice; (2) which occurs in trade or commerce; (3) that impacts the public interest; (4) which causes injury to the plaintiff in his or her business or property; and (5) which injury is causally linked to the unfair or deceptive act." Washington State Physicians Ins. Exchange & Ass'n v. Fisons Corp., 122 Wash.2d 299, 312 (1993) (citing Hangman Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 105 Wash.2d 778, 780 (1986)).
According to Bank of America, Mr. Rispoli's CPA claim fails as a matter of law because, inter alia, Mr. Rispoli failed to allege any facts regarding the public interest or injury elements of a CPA claim. See Def.'s Mot. at 8-9.
The court agrees with Bank of America that Mr. Rispoli has entirely failed to allege in his Complaint or in his declaration that he was injured as a result of any unfair or deceptive act made by Bank of America, nor has he alleged any public impact. Particularly in light of Mr. Rispoli's admission that he remains in his property despite the fact that he has been in default since December 2009, it seems that Mr. Rispoli could not allege injury. Thus, Mr. Rispoli has failed to allege any facts to support at least one element of his CPA claim, that claim must be dismissed.
IV. CONCLUSION
For the reasons stated above, the court GRANTS the Defendant's motion (Dkt. # 8).
Dated this 1st day of July, 2011.
/s/_________
The Honorable Richard A. Jones
United States District Judge