Cummings v. Tucker

1 WO [5] 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA [8] 9 Pamela Lynn Cummings, No. CV-21-01409-PHX-JJT 10 Plaintiff, ORDER 11 v. 12 Mark A. Tucker, et al., 13 Defendants. [14] 15 At issue is Defendant Greg Sir’s (“Mr. Sir”) Motion to Dismiss (Doc. 12) to which 16 pro se Plaintiff Pamela Lynn Cummings (“Ms. Cummings”) filed a Response (Doc. 26) 17 and Defendant Mr. Sir filed a Reply (Doc. 30).1 Also at issue is Defendants Catamount 18 Properties 2018, LLC (“Catamount”), Mark A. Tucker (“Mr. Tucker”), and Mark A. 19 Tucker P.C. d/b/a The Law Office of Mark A. Tucker’s (the “Tucker Law Office”)2 Joinder 20 and Motion to Dismiss (Doc. 21) to which Plaintiff filed a Response (Doc. 33) and 21 Catamount and the Tucker Defendants filed a Reply (Doc. 35). Defendant Evergreen 22 Escrow, Inc. d/b/a Evergreen Note Servicing (“Evergreen”) also filed a Notice of Joinder 23 and Motion to Dismiss (Doc. 22), to which Plaintiff filed a Response (Doc. 33), and 24 Defendant Evergreen filed a Reply (Doc. 36). The Court has reviewed the parties’ briefs [25] 26 1 Plaintiff also filed a Sur-Reply (Doc. 32, “Response and Objection Defendants Reply In Support of Motion to Dismis” [sic]). Leave of Court is required to file a Sur27 Reply. Plaintiff did not seek leave of Court, so the Court does not consider this filing. 28 2 Hereinafter, the Court refers to Mark A. Tucker and Mark A. Tucker P.C. d/b/a The Law Office of Mark A. Tucker collectively as the “Tucker Defendants.” 1 and finds this matter appropriate for decision without oral argument. See LRCiv 7.2(f). For 2 the reasons set forth below, the Court grants Defendants’ Motions. 3 I. BACKGROUND 4 Plaintiff alleges that on or about August 10, 2010, she took out a mortgage loan for 5 approximately $400,000 from Sir Mortgage Wholesale Corporation. (Doc. 1, Compl. 6 ¶ 13.1.) However, as Defendant Sir observes in his Motion to Dismiss, Plaintiff’s lender 7 was actually Sir Mortgage and Finance of Arizona Profit Sharing Plan. (Doc. 12 at 3.) 8 Plaintiff repeatedly references a Deed of Trust3 in her Complaint, which, contrary to 9 Plaintiff’s allegations cited above, was executed on May 10, 2017. (Doc. 12, Ex. 1 at 12.) 10 According to the Deed of Trust, Plaintiff took out a loan in the amount of $190,000, which 11 was secured by the Deed of Trust recorded against the real property commonly known as 12 1550 S. Chaparral Blvd., Gilbert, Arizona 85296 (“Subject Property”). The Deed of Trust 13 identifies Plaintiff as “Borrower,” Defendant Evergreen as “Trustee,” and “Sir Mortgage 14 & Finance Of Arizona, Inc. Profit Sharing Plan,” as “Lender.” (Doc. 12, Ex. 1 at 1.) 15 Plaintiff agreed to make monthly payments towards the principal and interest in the amount 16 of $2,223.80. (Doc. 12, Ex. 2 at 1, Promissory Note Principal and Interest Payments.) On 17 October 7, 2019, non-party Empire West Title Agency, LLC (“Empire”) was substituted 18 for Evergreen as “Trustee” of the Deed of Trust. (Doc. 12, Ex. 3, Notice of Substitution of 19 Trustee.) That same day, Empire issued a Notice of Trustee’s Sale under the Deed of Trust. 20 (Doc. 12, Ex. 4.) 21 Plaintiff claims that from May 2017 through May 2021 she made timely payments 22 to Defendant Evergreen, the note servicing company for Sir Mortgage and Finance-AZ Inc. 23 (Compl. ¶ 15.2.) Plaintiff further alleges that in spite of her timely payments, Defendant 24 Sir claimed that she was behind on her payments and hired the Tucker Defendants to 25 commence foreclosure proceedings. (Compl. ¶ 15.3.) According to the Trustee’s Deed [26] 27 3 The Court may consider a Deed of Trust at the Motion to Dismiss stage because it is a matter of public record. See Lee v. City of L.A., 250 F.3d 668, 688 (9th Cir. 2001) 28 (holding that a court may take judicial notice of, and properly consider, matters of public record). 1 dated July 28, 20214, which Plaintiff includes with her Complaint, the Subject Property 2 was sold at public auction on July 27, 2021, to Defendant Catamount Properties 2018, LLC. 3 (Compl. at 26.) The July 28, 2021 Trustee’s Deed names Empire as the Trustee. (Compl. 4 at 26.) 5 On August 16, 2021, Plaintiff filed the present action, alleging wrongful foreclosure, 6 violation of the Fair Debt Collection Practices Act (FDCPA), violation of the Truth in 7 Lending Act, breach of contract, violation of federal trust and lien laws, slander of title, 8 slander of credit, and infliction of emotional distress. (Compl. at 16-17.) Defendant Mr. Sir 9 filed a Motion to Dismiss, contending that Plaintiff’s Complaint fails to comply with Rule 10 8 of the Federal Rules of Civil Procedure because her claims are “so lacking in factual 11 support and detail, and are so unintelligible, that they are simply not plausible legal claims.” 12 (Doc. 12 at 4.) Defendants Catamount and the Tucker Defendants joined in Defendant 13 Mr. Sir’s Motion, and also filed their own Motion to Dismiss pursuant to Rule 12(b)(6), 14 asserting that Plaintiff has failed to state a claim upon which relief can be granted. (Doc. 21 15 at 3-5.) Likewise, Defendant Evergreen joined in Defendant Mr. Sir’s Motion, and also 16 filed its own Motion to Dismiss pursuant to Rules 8(a)(2) and 9(b) of the Federal Rules of 17 Civil Procedure. 18 II. LEGAL STANDARD 19 Federal Rule of Civil Procedure 12(b)(6) is designed to “test[] the legal sufficiency 20 of a claim.” Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). A dismissal under Rule 21 12(b)(6) for failure to state a claim can be based on either (1) the lack of a cognizable legal 22 theory or (2) insufficient facts to support a cognizable legal claim. Balistreri v. Pacifica 23 Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990). When analyzing a complaint under Rule 24 12(b)(6), the well-pled factual allegations are taken as true and construed in the light most 25 4 Typically courts cannot rely on extrinsic evidence without converting a motion to dismiss into a motion for summary judgment. Lee, 250 F.3d at 688 ; Fed R. Civ. P. 12(d). 26 However, courts “may consider evidence on which the complaint ‘necessarily relies’ if: (1) the complaint refers to the document; (2) the document is central to the plaintiff's claim; 27 and (3) no party questions the authenticity of the copy attached to the 12(b)(6) motion.” Marder v. Lopez, 450 F.3d 445, 448 (9th Cir. 2006). The court may treat such a document 28 as “part of the complaint, and thus may assume that its contents are true for purposes of a motion to dismiss under Rule 12(b)(6).” 1 favorable to the nonmoving party. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). 2 Legal conclusions couched as factual allegations are not entitled to the assumption of truth, 3 Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009), and therefore are insufficient to defeat a 4 motion to dismiss for failure to state a claim, In re Cutera Sec. Litig., 610 F.3d 1103 , 1108 5 (9th Cir. 2010). On a Rule 12(b)(6) motion, Rule 8(a) governs and requires that, to avoid 6 dismissal of a claim, Plaintiffs must allege “enough facts to state a claim to relief that is 7 plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). 8 III. ANALYSIS 9 Plaintiff asserts eight causes of action, each of which the Defendants move to 10 dismiss. The Court discusses each of Plaintiff’s claims in turn. 11 A. Claim 1: Wrongful Foreclosure 12 Plaintiff alleges that “[t]he foreclosing party did not have standing to execute the 13 power of sale clause in the deed of trust, and therefore the non-judicial foreclosure is void.” 14 (Compl. at 16.) She asserts that the lawyer who was involved in the Trustee’s sale of the 15 Subject Property was not authorized to exercise the power of sale. (Compl. ¶ 1.1.) She also 16 claims that Defendant Mr. Tucker “does not have a license to practice law.”5 (Compl. 17 ¶ 3.1-3.5.) 18 Defendant Mr. Sir argues that Plaintiff’s wrongful foreclosure claim should be 19 dismissed for several reasons, with which the other Defendants join. The Court agrees. 20 First, Mr. Sir correctly observes that the Deed of Trust, which Plaintiff signed, allows a 21 trustee to take the steps necessary for a trustee’s sale, as happened here. (Doc. 12 at 4-5, 22 Ex. 1 at 10.) Mr. Sir also notes that Arizona does not recognize “wrongful foreclosure” 23 claims. (Doc. 12 at 5.) In fact, under A.R.S. § 33-811(C), Arizona law makes clear that 24 borrowers waive all objections to a trustee’s sale not raised in an action that results in an 25 injunction or other relief under Rule 65 of the Arizona Rules of Civil Procedure, prior to 26 the day before the scheduled trustee’s sale. Put simply, “a person who has defenses or [27] 5 The Court does not consider this claim, as it is a matter of public record that 28 Mr. Tucker is an “Active” member of the State Bar of Arizona. See https://www.azbar.org/for-lawyers/practice-tools-management/member-directory/. 1 objections to a properly noticed trustee’s sale has one avenue for challenging the sale: filing 2 for injunctive relief.” Zubia v. Shapiro, 408 P.3d 1248 , 1251 (Ariz. 2018) (quoting BT 3 Capital, LLC v. TD Serv. Co. of Ariz., 275 P.3d 598, 599 (Ariz. 2012)). It is undisputed 4 that Plaintiff failed to bring an action for injunctive relief as required by A.R.S. 5 § 33-811(C). For these reasons, the Court dismisses Plaintiff’s first claim with prejudice as 6 to all Defendants. 7 B. Claim 2: Violation of the FDCPA 8 Plaintiff also alleges that “[t]he law firm, or the attorney, did not meet the 9 requirements mandated in the [FDCPA], necessary to be a legal debt collector.” (Compl. 10 ¶ 2.1.) Additionally, Plaintiff asserts that “[t]he debt collector in this case is in violation of 11 the FDCPA, as they do not meet the legal requirements to be considered a debt collector 12 and therefore have no standing before the court.” (Compl. ¶ 2.3.) 13 Defendant Mr. Sir argues that these allegations are frivolous, and do not pertain to 14 him, so should be dismissed. (Doc. 12 at 6.) Defendant Evergreen raises a similar argument, 15 and contends Plaintiff alleges no facts to support her claim that Evergreen violated the 16 FDCPA, noting that Evergreen did not participate in the nonjudicial foreclosure sale that 17 is the subject of the Complaint. (Doc. 22 at 7.) Defendant Catamount and the Tucker 18 Defendants point out that Plaintiff’s Complaint fails to allege any specific wrongdoing or 19 misconduct on their part, and reiterate that Plaintiff waived her ability to file this suit by 20 not obtaining injunctive relief prior to the Trustee’s Sale under A.R.S. § 33-811(C). 21 (Doc. 21 at 4-5.) 22 The Court agrees with all Defendants. The Court also finds it impossible to discern 23 from the Complaint how Plaintiff believes Defendants violated the FDCPA because the 24 allegations are anything but the “plain statement of the claim showing that the pleader is 25 entitled to relief” required by Rule 8. The Complaint fails to identify which of the several 26 Defendants undertook which actions, when, and most importantly, how those actions relate 27 at all to the elements of Section 1692(k) of the FDCPA. [28] 1 Even if Plaintiff were able to cure this deficiency in an amended complaint, 2 however, the claim cannot stand. “As a threshold matter, the FDCPA applies only to a debt 3 collector who engages in practices prohibited by the Act in an attempt to collect a consumer 4 debt.” Mansour v. Cal–Western Reconveyance Corp., 618 F. Supp. 2d 1178, 1182 (D. Ariz. 5 2009). This Court has held that “mortgagees and their beneficiaries, including mortgage 6 servicing companies, are not debt collectors subject to the FDCPA.” Id. The Court will 7 dismiss Plaintiff’s FDCPA claim with prejudice. 8 C. Claim 3: Violation of the Truth in Lending Act 9 Plaintiff’s third claim is that unspecified defendants violated the “Truth in Lending 10 Act, Regulation Z, 12 CFR §226.23 .” (Compl. at 16.) Earlier in her Complaint, Plaintiff 11 asserts that the Regulation was violated because “[t]he original debt was actually zero 12 because the Plaintiff’s financial asset was exchanged for FED’s promissory notes in an 13 even exchange.” (Compl. ¶ 12.1.) She argues that the “failure to disclose the true nature of 14 the exchange is clearly misrepresentation, fraud, harassment, unfair means, and deception 15 to collect a debt.” (Compl. ¶ 12.1.) 16 Like Plaintiff’s first and second claims, discussed above, this claim must fail as to 17 all Defendants. Plaintiff alleges no specific facts to support that any Defendant did anything 18 that could violate the Truth in Lending Act. See Fed. R. Civ. P. 8(a). Further, as Defendant 19 Evergreen correctly argues, the Deed of Trust securing Plaintiff’s loan was foreclosed, and 20 a foreclosure sale extinguishes any right to rescission under the Truth in Lending Act. 21 (Doc. 22 at 8, citing 15 U.S.C. § 1635 (f).) Under 15 U.S.C. § 1635 (f), “[a]n obligor’s right 22 of rescission shall expire three years after the date of consummation of the transaction or 23 upon the sale of the property, whichever occurs first.” Courts in the Ninth Circuit have 24 interpreted Section 1635(f) in cases with fact patterns similar to the present matter. For 25 example, in Mondragon v. Bank of America N.A., the Central District of California held 26 that a party’s right to rescind a loan transaction was extinguished when the property was 27 sold at a non-judicial foreclosure sale, reasoning that rescission is no longer available under 28 the Truth in Lending Act once a property is sold. No. ED CV 16-2462-R, 2019 1 WL 1751834 (C.D. Cal. Mar. 21, 2019) aff’d 831 Fed. App’x 357 (9th Cir. 2020). 2 Therefore, Plaintiff has no plausible claim under the Truth in Lending Act, so the Court 3 must dismiss Plaintiff’s third claim with prejudice. 4 D. Claim 4: Breach of Contract 5 Plaintiff’s fourth claim is that an unspecified Defendant, presumably Mr. Sir6, is 6 liable for breach of contract for the same reason on which she grounds her third claim— 7 “the original debt was actually zero because the Plaintiff’s financial asset was exchanged 8 for FED’s promissory notes in an even exchange.” (Compl. at 17.) 9 Defendant Mr. Sir points out that there is no allegation that Plaintiff has ever had a 10 contract with him as an individual, so the claim must be dismissed as to him. (Doc. 12 at 7.) 11 Defendant Catamount and the Tucker Defendants join in Mr. Sir’s argument. Defendant 12 Evergreen raises the same argument—Evergreen is not a party to any contract with 13 Plaintiff, and therefore could not have breached a contract with Plaintiff. (Doc. 22 at 9.) 14 Defendant Evergreen also argues that Plaintiff’s claim is based on the “vapor theory” of 15 money, which has been “universally discredited.” (Doc. 22 at 9.) 16 The Court agrees with all the Defendants’ arguments. The contract at issue was not 17 between Plaintiff and any of the named Defendants. (See Doc. 12, Ex. 1.) It follows that 18 Plaintiff fails to state a claim in accordance with the standards articulated in Twombly and 19 Iqbal. Additionally, Defendant Evergreen is correct that Plaintiff’s claim is based on the 20 meritless “vapor money theory.” In short, proponents of the vapor money theory argue that 21 mortgages are not enforceable because banks do not actually provide cash to the borrower. 22 See, e.g., Vollmer v. Present, CV 10-1182-PHX-MHM, 2011 WL 11415 at *6 (D. Ariz. 23 Jan. 4, 2011). Numerous courts throughout the Ninth Circuit have rejected claims based on 24 the vapor money theory as frivolous. See id. at *7. Thus, Plaintiff’s fourth claim is not 25 plausible and is therefore dismissed with prejudice. [27] 6 Mr. Sir is not explicitly named in this portion of Plaintiff’s Complaint, but in her 28 Response, she states that Mr. Sir is “liable for the Breach of Contract.” (Compl. at 17; Doc. 26 at 6.) 1 E. Claim 5: Violation of Federal Trust and Lien Laws 2 Plaintiff also asserts that an unspecified “defendant violated Federal Trust and Lien 3 Laws when he signed on behalf of the trustee without legal authorization.” (Compl. at 17.) 4 As Defendant Evergreen points out, there is no such thing as “Federal Trust and Lien 5 Laws,” and Plaintiff fails to cite any specific federal statutes other than those discussed 6 supra. (See, e.g., Doc. 22 at 9.) In her Response, Plaintiff does little to clarify this point, 7 arguing that “[d]efense provided no factual evidence the other Defendants are not in 8 violation and agree with the Plaintiff by acquiescence and tacit agreement.” (Doc. 26 at 7.) 9 The Court is unable to discern a plausible claim against any Defendant. Accordingly, 10 Plaintiff’s fifth claim is also dismissed with prejudice. 11 F. Claim 6: Slander of Title 12 Plaintiff’s sixth claim is that “[t]he defendants have caused to be recorded various 13 documents including a Notice of Trustee Sale and Deed of Trust which has impaired the 14 plaintiff's title which constitutes slander of title.” (Compl. at 17.) 15 Under Arizona law, “[t]he elements of slander of title . . . are the uttering and 16 publication of the slanderous words by the defendant, the falsity of the words, malice and 17 special damages.” City of Tempe v. Pilot Properties, Inc., 527 P.2d 515, 522 (Ariz. Ct. 18 App. 1974 ). Plaintiff has failed to identify any false statements, made with malice, which 19 caused her damage. 20 Defendant Mr. Sir acknowledges that a Notice of Trustee Sale was “duly recorded 21 with the Maricopa County Recorder,” but argues that Plaintiff’s sixth claim is essentially 22 the same as her first claim for “wrongful foreclosure,” which the Court addressed supra. 23 (Doc. 12 at 7; see also Doc. 12, Ex. 4, Notice of Trustee Sale.) The Court also agrees with 24 Defendant Mr. Sir’s argument. First, the Deed of Trust permitted the trustee to take the 25 steps necessary for a trustee’s sale, as happened here. (Doc. 12 at 4-5, Ex. 1 at 10.) Second, 26 as already discussed, Plaintiff waived her ability to file this suit by not obtaining injunctive 27 relief prior to the Trustee’s Sale under A.R.S. § 33-811(C). [28] 1 It follows that Plaintiff has failed to state a plausible claim for relief, so her sixth 2 claim is dismissed with prejudice as to all Defendants. 3 G. Claim 7: Slander of Credit 4 Plaintiff’s seventh claim for relief is that “the actions and inactions of the defendants 5 have impaired her credit.” (Compl. at 17.) 6 Plaintiff does not reference any authority to show that Arizona recognizes a cause 7 of action entitled “slander of credit,” nor was the Court able to find such a cause of action 8 in its own research. Additionally, Plaintiff’s claims are too vague to raise the right to relief 9 above the speculative level, as required by Twombly and Iqbal. Thus, Plaintiff’s seventh 10 claim is dismissed with prejudice as to all Defendants because it fails to state a plausible 11 claim under Rule 8(a) of the Federal Rules of Civil Procedure. 12 H. Claim 8: Intentional and Negligent Infliction of Emotional Distress 13 Plaintiff’s final claim is that “[t]he defendants have intentionally and negligently 14 taken actions which have caused the plaintiffs severe and immeasurable emotional 15 distress.” (Compl. at 17.) 16 Conduct supporting a claim for intentional infliction of emotional distress must be 17 “extreme” and “outrageous.” Ford v. Revlon, Inc., 734 P.2d 580, 585 (Ariz. 1987) (internal 18 citations omitted). 19 The trial court must determine whether the acts complained of are sufficiently extreme and outrageous to state a claim for relief. A plaintiff [20] must show that the defendant's acts were so outrageous in character and so 21 extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious and utterly intolerable in a civilized community. [22] 23 Mintz v. Bell Atl. Sys. Leasing Int'l, 905 P.2d 559, 563 (Ariz. Ct. App. 1995) (internal 24 quotations and citations omitted). To state a claim for negligent infliction of emotional 25 distress under Arizona law, a plaintiff must show bodily harm. Id. at *6. The showing of 26 bodily harm may be satisfied by a physical injury, a long-term physical illness or a mental 27 disturbance, but will not be satisfied by “transitory physical phenomena.” Id. (quoting 28 Monaco v. Health Partners of S. Ariz., 995 P.2d 735, 738-39 (Ariz. Ct. App. 1999)). Arizona Courts have also rejected negligent infliction of emotional distress claims arising 2|| from facts similar to those of the present matter. See Deno v. Transamerica Title Ins. Co., 3|| 126 Ariz. 527, 527 , 617 P.2d 35, 37 (Ariz. Ct. App. 1980) (holding that negligent 4|| performance of a fiduciary duty does not give rise to a claim for emotional distress without 5 || physical harm in the absence of bad faith or other intentionally tortious conduct). 6 Plaintiff alleges no facts to support a claim for either negligent or intentional infliction of emotional distress. Nor could Plaintiff plead any facts to show that 8 || Defendants’ conduct was extreme and outrageous, or even negligent. As the Court has 9|| reiterated throughout this Order, the Deed of Trust, which Plaintiff signed, allows a trustee 10 || to take the steps necessary for a trustee’s sale, as happened here. (Doc. 12 at 4-5, Ex. 1 11 || at 10.) There is no evidence that any Defendant or unnamed party behaved in an extreme 12 || and outrageous or negligent manner in proceeding with a trustee’s sale. Thus, □□□□□□□□□□□ 13 || final claim does not meet the plausibility standard as outlined by Twombly and Igbal and is dismissed with prejudice. 15 IT IS THEREFORE ORDERED granting Defendants’ Motions to Dismiss (Docs. 12, 21, 22). 17 IT IS FURTHER ORDERED dismissing with prejudice all claims against 18 || Defendant Mr. Sir, Defendant Catamount, the Tucker Defendants, and Defendant || Evergreen. 20 IT IS FURTHER ORDERED directing the Clerk of Court to enter judgment accordingly and close this case. 22 Dated this 10th day of June, 2022. CN 23 “wok: 24 wefehlee— Unig StatesDistrict Judge [28] -10-