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Saepoff v. North Cascade Trustee Services, Inc.

United States District Court, W.D. Washington, Seattle

September 23, 2019

JESSICA SAEPOFF, Plaintiff,
v.
NORTH CASCADE TRUSTEE SERVICES, INC., et al., Defendants. HSBC BANK USA N.A. AS TRUSTEE ON BEHALF OF ACE SECURITIES CORP. HOME EQUITY LOAN TRUST AND FOR THE REGISTERED HOLDERS OF ACE SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2007-WM2, ASSET BACKED PASS-THROUGH CERTIFICATES, Counterclaimant,
v.
JESSICA SAEPOFF, et al., Counterdefendants.

          ORDER GRANTING DEFENDANTS HSBC, MERS, AND OCWEN'S MOTION FOR JUDGMENT ON THE PLEADINGS

          Robert S. Lasnik, United States District Judge.

         This matter comes before the Court on a motion for judgment on the pleadings filed by defendants HSBC Bank USA, N.A. as trustee on behalf of Ace Securities Corp. Home Equity Loan Trust and for the Registered Holders of Ace Securities Corp. Home Equity Loan Trust, Series 2007-WM2, Asset Backed Pass-Through Certificates (“HSBC”), MERSCORP Holdings, Inc. (“MERCORPS”), Mortgage Electronic Registration Systems, Inc. (“MERS”), and Ocwen Mortgage Service, LLC (“Ocwen”) (collectively, “defendants”), see Dkt. #63, and plaintiff's “Motion to Strike Defendants ‘Reply' Re: Defendants' Motion for Judgment on the Pleadings.” See Dkt. #72.

         For the reasons that follow, defendants' motion is GRANTED. Plaintiff's motion to strike, Dkt. #72, is DENIED.

         BACKGROUND

         On November 2, 2006, plaintiff Jessica Saepoff executed and delivered to WMC Mortgage Corporation (“WMC”) an Adjustable Rate Note in the amount of $490, 000 (“the Note”). Ex. A, Dkt. #1-2 at 51-57. On the same date, to secure payment on the Note, plaintiff executed a Deed of Trust pertaining to property located at 4003 92nd Avenue SE, Mercer Island, Washington (“the Property”). Ex. B, Dkt. #1-2 at 59-76; see Dkt. #1-2 (Compl.) at ¶¶ 4.1-4.7. This named MERS as the nominee for WMC and the beneficiary under the Deed of Trust. Ex. B, Dkt. #1-2 at 59-60. The Deed of Trust was recorded on November 6, 2006 in King County, Washington. Ex. 1, Dkt. #63-1 at 4-21.[1] On April 7, 2011, MERS assigned its interest in the Deed of Trust to HSBC (“the Assignment”). Ex. 2, Dkt. #63-1 at 22. The assignment was prepared by Ocwen. Id.; see Compl. at ¶ 4.37. On May 21, 2015, HSBC appointed North Cascade Trustee Services, Inc. (“North Cascade”) as Successor Trustee under the Deed of Trust. Ex. 3, Dkt. #63-1 at 23-24; see Compl. at ¶ 4.39. On January 19, 2016, North Cascade recorded a Notice of Trustee's Sale. Ex. 9, Dkt. #63-1 at 35-38; see Compl. at ¶ 4.40. The sale was canceled by a Notice of Discontinuance of Trustee's Sale recorded by North Cascade on October 27, 2016. Ex. 11, Dkt. #63-1 at 42; see Compl. at ¶ 4.41.

         Plaintiff filed her first complaint in the King County Superior Court on April 25, 2016, and a Second Amended Complaint on February 10, 2017. She argues that the Note was not properly transferred to any of the defendants, and that defendants lacked the authority to enforce, transfer, assign or foreclose on the Note. She brought six causes of action. First, she requests that the Court make various declarations regarding the Note, the Deed of Trust, the Assignment, the Appointment of Successor Trustee, the Notice of Trustee's Sale, and her right to prepay her loan. Compl. at ¶¶ 5.1-5.13. Second, she asserts that the Deed of Trust, the Assignment, the Appointment of Successor Trustee and Notice of Trustee's Sale all contain material misrepresentations and constitute mortgage fraud and/or fraudulent misrepresentation. Id. at ¶¶ 5.14-5.18; see RCW 19.144.080. Third, she alleges that Ocwen violated Washington's Consumer Loan Act (“CLA”). Compl. at ¶¶ 5.19-5.21; see RCW 31.04.015 et seq. Fourth, she asserts that North Cascade violated the Deed of Trust Act (“DTA”). Compl. at ¶¶ 5.22-5.23. Fifth, she alleges violations of Washington's Consumer Protection Act (“CPA”). Id. at ¶¶ 5.24- 5.30; see RCW 19.86.010 et seq. Sixth, she brings a quiet title claim. Compl. at ¶ 5.31.

         On April 11, 2017, defendants filed their answer and counterclaimed for judicial foreclosure of the subject Deed of Trust, joining, among others, the United States of America. Dkt. #1-2 at 7-20. The United States removed the case to this Court on June 22, 2017. Dkt. #1 at 1-5; see 28 U.S.C. §§ 1442(a)(1), 1444, 2410.

         A. Parties' Motions to Strike

         Plaintiff was recently compelled to substitute her local Washington counsel. Dkt. #72 at 2. On January 16, 2019, plaintiff's counsel sent an email to defense counsel indicating that Lucy Gilbert, Esq., plaintiff's new local counsel, would be involved in the case going forward. Ex. A, Dkt. #75-1 at 3. Ms. Gilbert entered her Notice of Appearance on February 20, 2019. Dkt. #64. Defendants' motion for judgment on the pleadings was initially noted for March 8, 2019. Dkt. #63. On March 5, 2019, plaintiff's counsel and defense counsel exchanged emails agreeing to continue the noting date to March 15, 2019. Ex. B, Dkt. #75-1 at 4-7. The deadline for plaintiff's response, therefore, was March 11, 2019. See LCR 7(d). Plaintiff did not file a response by that deadline. On March 15, 2019, defendants filed a reply, arguing that their motion should be granted. Dkt. #70; see LCR 7(b)(2) (“if a party fails to file papers in opposition to a motion, such failure may be considered by the court as an admission that the motion has merit.”). Plaintiff eventually filed a response on March 18, 2019, see Dkt. #71, and filed a motion to strike defendants' reply. Dkt. #72. Defendants filed a response to plaintiff's motion to strike, see Dkt. #75, and a supplemental reply in support of their motion for judgment on the pleadings requesting that plaintiff's response be stricken. Dkt. #76.

         Plaintiff did not request relief from the court deadlines as required by the local rules. See LCR 7(j). Nor did plaintiff abide by the local rules in requesting that defendants' reply be stricken. See LCR 7(g). For the sake of completeness, the Court will consider plaintiff's response in its ruling. However, this is the second time that plaintiff has failed to adhere to court deadlines. See Dkt. #77.

         For all the foregoing reasons, the Court DENIES plaintiff's motion to strike defendants' reply, Dkt. #72, and DENIES defendants' request to strike plaintiff's response. Dkt. #76.

         DISCUSSION

         A. Legal Standard

         A party may move for judgment on the pleadings after the pleadings are closed. Fed.R.Civ.P. 12(c). “The same legal standard applies to a motion for judgment on the pleadings as to a motion to dismiss for failure to state a claim.” Dacumos v. Toyota Motor Credit Corp., 287 F.Supp.3d 1152, 1154 (W.D. Wash. 2017) (citing Cafasso v. Gen. Dynamics C4 Sys., Inc., 637 F.3d 1047, 1055 n.4 (9th Cir. 2011)). The Court accepts “as true all material facts alleged in the pleadings and draw[s] all reasonable inferences in favor of the nonmoving party.” Id. (citing Fleming v. Pickard, 581 F.3d 922, 925 (9th Cir. 2009)). “Judgment on the pleadings is proper when the moving party clearly establishes on the face of the pleadings that no ...


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