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Brophy v. JPMorgan Chase Bank, N.A.

United States District Court, E.D. Washington

March 27, 2015

MARK W. BROPHY, and SUSAN A. BROPHY, Plaintiffs,
JPMORGAN CHASE BANK, N.A.; WASHINGTON MUTUAL BANK; BANK OF AMERICA N.A.; LASALLE BANK N.A., as Trustee for Securitized Trust WAMU Mortgage Pass-Through Certificates, Series 2006-AR11; WAMU ASSET ACCPETANCE CORP.; NORTHWEST TRUSTEE SERVICES, INC., and DOES 1-100, inclusive. Defendants.


THOMAS O. RICE, District Judge.

BEFORE THE COURT is Defendant Northwest Trustee Services, Inc.'s Motion to Dismiss for Failure to State a Claim. ECF No. 5. Defendant Northwest Trustee Services, Inc. ("NWTS"), is represented by Joseph H. Marshall. Plaintiffs are represented by Jill J. Smith. This matter was submitted for consideration without oral argument. The Court has reviewed the briefing and the record and files herein, and is fully informed.


Plaintiffs filed a complaint in Spokane County Superior Court on October 27, 2014, seeking damages and declaratory and injunctive relief. ECF Nos. 1 at ¶ 1; 12-2. That case was removed to this Court on December 22, 2014. ECF No. 1. On January 26, 2015, Plaintiffs filed a motion for a temporary restraining order to prevent a trustee's sale of the real property that is the subject of this lawsuit. ECF No. 10. The Court denied that motion on February 13, 2015. ECF No. 15.

On January 23, 2015, prior to Plaintiffs' motion for a temporary restraining order, Defendant NWTS filed the current motion to dismiss this matter for failure to state a claim upon which relief can be granted. ECF No. 5. No other Defendants joined the motion. Plaintiffs did not initially respond to the motion within the timeframe established by the local rules. On March 10, 2015, the Court granted in part Plaintiffs' motion for extension of time to file a response pursuant to Federal Rule of Civil Procedure 6(b)(1)(B). ECF No. 20. Plaintiffs filed a late response on March 18, 2015. ECF No. 22.


The following facts are drawn from Plaintiffs' complaint and are accepted as true for the purposes of the instant motion. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007). In July 2006, Plaintiffs obtained a $745, 800 loan from Defendant Washington Mutual Bank, N.A. ECF No. 12-2 at ¶¶ 13, 16. The promissory note for this loan was secured by a deed of trust encumbering the subject real property. Id. at ¶¶ 13, 16. The promissory note was transferred into the Washington Mutual Pass-Through Certificates Series 2006-ARI for which Defendant LaSalle Bank, N.A., served as trustee. Id. at ¶¶ 4, 14.

At some point thereafter the note was transferred to Defendant JPMorgan Chase Bank, N.A. ("JPMorgan Chase"), whom Plaintiffs contacted in 2007 in order to refinance or obtain a loan modification. Id. at ¶ 37. Defendant JPMorgan Chase, would not consider a modification at that time. Id. In 2011, Plaintiffs spoke with a loan officer at a local branch of Defendant JPMorgan Chase. Id. at ¶ 39. They were advised to stop making payments on their mortgage in order for a modification to be granted. Id. Following the cessation of payments, Plaintiffs were contacted about a modification. Id. at ¶ 40. However, Defendant JPMorgan Chase again denied Plaintiffs' requests for modification. Id. at ¶¶ 41, 44.

On November 29, 2012, Defendant JPMorgan Chase appointed Defendant NWTS as successor trustee for the deed of trust. ECF Nos. 12-2 at ¶ 51; 6-3. Plaintiffs allege that the signature on that document of Michelle M. Gill, a vicepresident of Defendant JPMorgan Chase, is a forgery. ECF No. 12-2 at ¶ 52. Plaintiffs allege further that Gill did not have authority to appoint a successor trustee, that she was not a vice-president at Defendant JPMorgan Chase, and that Defendant JPMorgan Chase's corporate resolution does not authorize Gill to act on its behalf. Id. Plaintiffs further allege that the signature of the notary public, Bonnie L. Hobbs, is also a forgery and that Hobbs is not a notary public in the state of Ohio. Id. at ¶ 54. This document was recorded in Spokane County on December 12, 2012. ECF No. 6-3.[1] On December 10, 2012, a Beneficiary Declaration was executed by Salwa Ahmad on behalf of Defendant JPMorgan Chase averring that "JPMorgan Chase Bank, National Association, is the holder of the promissory note or other obligation evidencing the above-referenced loan. The trustee may rely upon the truth and accuracy of the averments made in this declaration." ECF No. 6-2. For the purpose of this motion, the Court will construe Plaintiffs' complaint to allege this document was also fraudulently executed by Defendant JPMorgan Chase.[2]

On October 24, 2014, Defendant NWTS executed a Notice of Trustee's Sale to foreclose on the subject property. ECF No. 22 at 5. While the Court denied Plaintiffs a temporary restraining order, the scheduled trustee sale was nevertheless cancelled by Defendant NWTS. Id.


A motion to dismiss for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6) tests the legal sufficiency of the Plaintiffs' claims. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). A complaint must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). This standard "does not require detailed factual allegations, but it demands more than an unadorned, the defendant-unlawfullyharmed-me accusation." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 555). To withstand dismissal, a complaint must contain "enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570. "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." Iqbal, 556 U.S. at 678. "Naked assertion[s], " "labels and conclusions, " or "formulaic recitation[s] of the elements of a cause of action will not do." Twombly, 550 U.S. at 555, 557. While a plaintiff need not establish a probability of success on the merits, he or she must demonstrate "more than a sheer possibility that a defendant has acted unlawfully." Iqbal, 556 U.S. at 678; see also Johnson v. City of Shelby, 135 S.Ct. 346, 347 (2014) (per curiam) ("A plaintiff... must plead facts sufficient to show that her claim has substantive plausibility.").

In assessing whether Rule 8(a)(2) has been satisfied, a court must first identify the elements of the plaintiff's claim(s) and then determine whether those elements could be proven on the facts pled. See Iqbal, 556 U.S. at 675. A complaint fails to state a claim upon which relief may be granted only if it fails to inform the defendants of facts sufficient to show the claims have substantive plausibility. See Johnson, 135 S.Ct. at 347 ("Having informed the city of the factual basis for their complaint, they were required to do no more to stave off threshold dismissal for want of an adequate statement of their claim.").

In this evaluation, the court should draw all reasonable inferences in the plaintiff's favor, see Sheppard v. David Evans & Assocs., 694 F.3d 1045, 1051 (9th Cir. 2012), but it need not accept "naked assertions devoid of further factual enhancement." Iqbal, 556 U.S. at 678 (internal quotations and citation omitted). Generally, in ruling upon a motion to dismiss, a court must accept all factual allegations in the complaint as true and construe the pleadings in the ...

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