Editor: David Reiss
Brooklyn Law School

March 7, 2013

Hawaii District Court Dismisses Plaintiff Homeowners’ Complaint with Prejudice for Various Failures to Plead with Particularity

By Jeffrey Lederman

In Gambing v. OneWest Bank, 2011 U.S. Dist. LEXIS 77924 (D. Haw. July 18, 2011), Plaintiffs Lorenzo and Lorie Gambing’s filed a twelve-count motion against OneWest Bank, MERS, and other parties to prevent the foreclosure of their property. OneWest and MERS’s motion to dismiss the complaint was granted with prejudice when the Plaintiffs failed to file opposition documentation and failed to appear at their hearing. The court granted Plaintiffs leave to file a request to reopen the case within 15 days.

The court noted that to survive a motion to dismiss, per Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955 (U.S. 2007), the Plaintiffs needed to do more than provide a laundry list of different causes of action. Rather, Plaintiffs should supply facts to support their claims with “plausible grounds for relief.” The court further noted that for allegations of fraud or mistake, the Plaintiffs are required to “state with particularity the circumstances constituting fraud and mistake.” Fed. R. Civ. P. 9(b). The court considered and ruled upon the myriad claims of the plaintiffs using these criteria as its starting point for analysis.

The court dismissed Plaintiffs’ claims for declaratory relief and injunctive relief to prevent foreclosure of their property because they failed to provide factual support for their conclusions relating to Defendant’s compliance with RESPA procedures or violations of relevant State and Federal laws.

The court similarly dismissed Plaintiffs’ claims for contractual breach of implied covenant of good faith and fair dealings, as they failed to allege any facts demonstrating defendants charged excessive fees or withheld disclosures and notices.

Plaintiffs’ TILA violation claims for both rescission, under 15 U.S.C. § 1635, and for damages under 5 U.S.C. § 1640  were both time barred. Claims for equitable tolling do not apply for rescission and plaintiffs never alleged any facts to support a claim that they could not have found TILA violations with reasonable diligence justifying equitable tolling.

Plaintiffs’ unfair and deceptive business practices claims were also dismissed because they only included conclusory statements and no factual support.

Plaintiffs’ claim for beach of fiduciary duty by the defendants was dismissed, as no fiduciary duty was owed to Plaintiffs beyond the “arms-length” lender-borrower relationship.

The Plaintiffs’ claim under UCC-2302 that the loan agreement was unconscionable, was dismissed, because the plaintiffs did not provide any evidence of contractual terms or behavior that support such a claim,

The Plaintiffs also alleged that the defendants engaged in a variety of predatory lending practices, but did not point to any state or federal law which these practices violate, The court dismissed these claims, as it noted that the court is not required to speculate as to which laws these would be.

Furthermore, Plaintiffs sought to quiet title against all the defendants, but the court dismissed these claims as well. The Plaintiffs in their filing did not recognize or isolate which defendant they were making claims against and the court was unable to determine the specific claims against each named party, and as such, Plaintiffs failed to property state a claim to quiet title.

Plaintiffs also made the bold claim that the assignment of mortgage to MERS was illegal and thereby gave MERS no standing to foreclose, a claim the court found confusing given that standing is required only for plaintiffs, not defendants and because no facts were supplied to support this claim.

Lastly, Plaintiffs alleged the defendants’ conduct constituted fraud, but much like all the other claims, these failed to meet the burden of Fed. R. Civ. P. 8 or the heightened requirements for fraud under Fed. R. Civ. P. 9(b).

Nonetheless, the court granted Plaintiffs’ leave to file a request to reopen the case within 15 days of the filing.

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