Buchanan v. Gandhi

• Court: District Court, D. Arizona
• Decided: November 18, 2022
• Docket: 2:22-cv-01482
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 John Clark Buchanan, II, No. CV-22-01482-PHX-SMB

10 Plaintiff, ORDER

11 v.

12 Randhir Gandhi, et al.,

13 Defendants. 14 15 Before the Court are two motions by Plaintiff regarding the same foreclosure and 16 eviction. The first is Plaintiff’s Motion for Non-Judicial Temporary Restraining Order to 17 Permanent Injunction & Demand for Emergency Hearing to Stop or Stay Proposed Sale of 18 730 North Cedar Ridge Drive, Oracle, Arizona, 85623 Due to Pending Title Dispute & 19 Wrongful Foreclosure Lawsuit Stay Until Trial. (Doc. 2). Defendants filed a Response 20 (Doc. 9), and Plaintiff filed a Reply (Doc. 20). Plaintiff filed a second, nearly identical 21 Motion putting forth the same arguments and requesting the same relief. (See Doc. 17.) 22 Plaintiff requested oral argument, but because the Motion is fully briefed, the Court denies 23 the request as it would be unnecessary. See LRCiv 7.2(f) (“The Court may decide motions 24 without oral argument.”). The Court denies both Motions for the reasons discussed below. 25 As such, Defendants’ Motion to Strike Plaintiff’s second Motion (see Doc. 28) is denied 26 as moot, and Defendants’ need not file a Response to (Doc. 17). 27 I. BACKGROUND 28 On July 26, 2005, Plaintiff and Bank of America, N.A. (“BANA”) executed a 1 Promissory Note titled “Bank of America Equity Maximizer Agreement and Disclosure 2 Statement” (“Loan Agreement”), which detailed Plaintiff’s $150,000 credit line to 3 purchase the property in question. (See Docs. 9 at 3; 9-1 at 2–3, 9.) Plaintiff agreed to pay 4 the total of all credit advances and the costs and expenses that secured his credit line. 5 (Docs. 9 at 3; 9-1 at 2.) The Promissory Note was secured by a Deed of Trust. (Docs. 9 at 6 3; 9-2 at 7.) The Deed of Trust was signed by Plaintiff and Theresa Buchanan. (Docs. 9 7 at 3; 9-2 at 2.) On August 15, 2005, the Deed was recorded in the Pinal County Recorder’s 8 Office as Instrument No. 2005-104177. (Docs. 9 at 3; 9-2 at 2.) 9 BANA executed a Notice of Substitution of Trustee on August 10, 2016, naming 10 Quality Loan Service Corporation as the Substitute Trustee under the Deed of Trust. 11 (Docs. 9 at 3; 9-3 at 2.) BANA recorded the Notice of Substitution of Trustee with the 12 Pinal County Recorder’s office. (Docs. 9 at 3; 9-3 at 2.) On December 27, 2019, BANA 13 assigned all interests in the property to the beneficiary through its servicing agent, 14 Defendant Select Portfolio Servicing, Inc. (“SPS”). (Docs. 9 at 3–4; 9-4 at 2.) 15 Plaintiff’s two Motions do not provide any factual background on his Loan 16 Agreement payment history. (See Docs. 2; 17.) Therefore, Defendants cite to Plaintiff’s 17 Complaint (Doc. 1 at 13 ¶ 15.2) to assert that Plaintiff made timely payments under the 18 Loan Agreement for eleven years, ceased making regular and timely payments in 2016, 19 and stopped making payments entirely in 2017. (See Doc. 9 at 4.) But specifically, 20 Plaintiff’s Complaint asserts that: Beginning in 2005 and continuing until June, 2016 the plaintiff made timely 21 payments to Bank of America; on time and never missing a payment; until 22 Bank of America several times on a recorded line said, (via their Bank of America Agents) “Stop making payments”. On a recorded line. In January 23 of 2017 it was agreed by Bank of America Agents and I to pay $300 per 24 month during bankruptcy direct to them for purported mortgage; this lasted until approximately October of 2017, then BANK OF AMERICA agents said 25 approximately 7 times in multiple recorded conversations to stop making 26 payments. So I, John-Clark: Buchanan II stopped making payments. 27 (Doc. 1 at 13 ¶ 15.2.) 28 Next, Defendants assert that between 2016 and 2021, either BANA or SPS offered 1 loan assistance to Plaintiff. (See Docs. 9 at 4; 9-5; 9-6.) Defendants claim that Plaintiff 2 either failed to provide the necessary documents or rejected the offers for loan assistance. 3 (Doc. 9 at 4.) Defendants further claim that BANA and SPS provided notices to Plaintiff 4 regarding potential foreclosure due to missed payments. (Id.) Defendants allege that on 5 November 12, 2019, SPS delivered a letter to Plaintiff, informing Plaintiff that a 6 foreclosure sale for his property was scheduled for December 4, 2019. (Doc. 9-6.) 7 Ultimately, the foreclosure sale was continued for nearly three years, and the property was 8 eventually sold on September 6, 2022. (See Docs. 9-7; 9-8.) 9 II. LEGAL STANDARD 10 Plaintiff’s Motions appear to seek Temporary Restraining Orders (“TRO”) and 11 permanent injunctions of the sale of his property and any eviction efforts. A party seeking 12 preliminary injunctive relief under Federal Rule of Civil Procedure 65 must show that: (1) 13 he is likely to succeed on the merits; (2) he is likely to suffer irreparable harm in the absence 14 of injunctive relief; (3) the balance of equities tips in his favor; and (4) an injunction is in 15 the public interest.1 Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 20 (2008). “A 16 preliminary injunction is ‘an extraordinary and drastic remedy, one that should not be 17 granted unless the movant, by a clear showing, carries the burden of persuasion.’” Lopez, 18 680 F.3d at 1072 (quoting Mazurek v. Armstrong, 520 U.S. 968, 972 (1997) (emphasis 19 omitted)); see also Winter, 555 U.S. at 24 (“A preliminary injunction is an extraordinary 20 remedy never awarded as of right.”). A party seeking a permanent injunction must 21 establish the same factors, but also demonstrate actual success on the merits. Indep. 22 Training & Apprenticeship Program v. Cal. Dep’t of Indus. Rels., 730 F.3d 1024, 1032 23 (9th Cir. 2013). 24 The analysis for granting a TRO is “substantially identical” to that for a preliminary

25 1 Where a party “can only show that there are serious questions going to the merits—a lesser showing than likelihood of success on the merits—then a preliminary 26 injunction may still issue if the balance of hardships tips sharply in the [party]’s favor, and the other two Winter factors are satisfied.” Shell Offshore, Inc. v. Greenpeace, Inc., 709 27 F.3d 1281, 1291 (9th Cir. 2013) (cleaned up). Under this Ninth Circuit “serious questions” test, “[t]he elements . . . must be balanced, so that a stronger showing of one element may 28 offset a weaker showing of another.” Lopez v. Brewer, 680 F.3d 1068, 1072 (9th Cir. 2012). 1 injunction. Stuhlbarg Int’l Sales Co., Inc. v. John D. Brush & Co., Inc., 240 F.3d 832, 839 2 n.7 (9th Cir. 2001). Unlike a preliminary injunction, see Fed. R. Civ. P. 65(a), a temporary 3 restraining order (“TRO”) may be entered “without written or oral notice to the adverse 4 party.” Fed. R. Civ. P. 65(b). A TRO may issue, ex parte, if: (A) specific facts in an affidavit or a verified complaint clearly show that 5 immediate and irreparable injury, loss, or damage will result to the movant 6 before the adverse party can be heard in opposition; and (B) the movant’s attorney certifies in writing any efforts made to give notice and the reasons 7 why it should not be required. 8 Fed. R. Civ. P. 65(b) (emphasis added); see also LRCiv 65.1. 9 III. DISCUSSION 10 A. Motions for TRO and Permanent Injunction to Stop or Stay the Sale of 11 Plaintiff’s Property 12 Plaintiff’s Motions, which in part invites the Court to stop or stay the sale of his 13 property by TRO or permanent injunction, is moot. The property was sold by non-judicial 14 foreclosure on September 6, 2022, and is now owned by the beneficiary, MEB Loan Trust 15 IV. (See Doc. 9-8.) “A claim is moot ‘when the issues presented are no longer live or the 16 parties lack a legally cognizable interest in the outcome.’” Alvarez v. Hill, 667 F.3d 1061, 17 1064 (9th Cir. 2012) (quoting U.S. Parole Comm’n v. Geraghty, 445 U.S 388, 396 (1980)). 18 Because the foreclosure sale occurred, Plaintiff lacks a live or legally cognizable interest 19 for this Court to temporarily or permanently enjoin the property’s transfer. For these 20 reasons, Plaintiff’s Motions to stop or stay the foreclosure are denied. 21 B. Motions for TRO and Permanent Injunction to Stop Any Eviction 22 Efforts 23 Plaintiff’s Motions also request the Court to stop or stay Plaintiff’s impending 24 eviction. However, the Court finds that Plaintiff’s claims fail to establish any of the four 25 Winter factors for granting a TRO or permanent injunction. 26 1. Plaintiff is unlikely to succeed on the merits of this action. 27 For the Court to grant a TRO, Plaintiff must demonstrate a likelihood of success on 28 the merits. Winter, 555 U.S. at 20. And for a permanent injunction, Plaintiff must establish 1 actual success on the merits. Indep. Training & Apprenticeship Program, 730 F.3d at 1032. 2 Plaintiff asserts numerous claims, many of which are completely without citation to legal 3 authority. These include claims that: (1) Defendants failed to prove there was any debt 4 because the promissory note was not included in the “notice of default and election to sell 5 document”; (2) that Defendants’ cannot admit the Deed of Trust, Notice of Default, or 6 election to sell documents into evidence because the promissory note was not admitted; (3) 7 Defendant’s did not have the legal authority to exercise the power of sale clause or 8 foreclose upon the home; (4) a question of lawful consideration exists; and (5) there is no 9 fact witness to testify. (See Docs. 2; 17.) Because Plaintiff failed to present any legal 10 authority supporting these assertions, it is unlikely Plaintiff would succeed on the merits 11 of this claim. It follows that Plaintiff has not established actual success on the merits, 12 either. As such, these claims fail factor one. 13 Plaintiff raises other claims with citation to legal authority, which the Court 14 addresses separately. First, Plaintiff states in a heading that “[t]he Attorneys violated 15 Arizona Lien Laws.” (Docs. 2 at 3; 17 at 3.) Plaintiff proceeds to cite and describe the 16 crime of forgery under Arizona state law but makes no factual assertions as to how A.R.S. 17 § 13-2002 was violated here. (Docs. 2 at 3–4; 17 at 3–4.) Because Plaintiff asserts no 18 factual argument for a statutory violation, this claim fails under factor one. 19 Plaintiff also alleges Defendants violated federal wire fraud laws, citing 18 U.S.C. 20 § 1343. However, Plaintiff merely states that Defendants used wire communications such 21 as “facsimile’s, emails and the internet to accomplish this scheme to defraud the 22 homeowner, and the courts by causing to be sent, filed, and record mortgage documents 23 which they knew or should have known to be fraudulent.” (Docs. 2 at 7; 17 at 7.) Beyond 24 this sweeping allegation, Plaintiff provides no supporting facts, evidence, or legal authority 25 to support his claim. Therefore, this claim fails factor one. 26 Next, Plaintiff alleges that Defendants violated the Fair Debt Collection Practice 27 Act, citing 15 U.S.C. § 1692, et seq., because Defendants misrepresented themselves as 28 having legal authority to collect debts secured by the Deed of Trust. But Plaintiff fails to 1 cite legal authority supporting this proposition, or how Defendants unlawfully exercised 2 their rights under the applicable agreements. (See Docs. 9-1–9-4; 9-7–9-8.) At most, 3 Plaintiff cites to various Uniform Commercial Code (“UCC”) provisions, all of which are 4 irrelevant to his asserted claim of fraud and misrepresentation. This claim fails factor one. 5 Plaintiff subsequently raises arguments that Defendants had a scheme to defraud 6 because “the creditor does not provide full disclosure, and the contract is extremely 7 deceptive and unconscionable.” (Docs. 2 at 8; 17 at 8.) To support this claim, Plaintiff 8 generally cites to In re Pearl Maxwell, 281 B.R. 101 (Bankr. D. Mass. 2002) but fails to 9 provide any facts for an analysis to be conducted under the caselaw. Plaintiff also asserts 10 that his “original debt was actually zero because the borrower’s financial asset was 11 exchanged for FED’s promissory notes in an even exchange.” (Docs. 2 at 8; 17 at 8.) 12 Furthermore, Plaintiff cites irrelevant provisions of the UCC, and proceeds to assert that 13 security agreements signed with a lender can be rescinded without proper disclosures under 14 12 C.F.R. § 226.23, and that 15 U.S.C. §§ 1601, 1692, and 1693 provide remedies for 15 Defendants’ deceptive and unconscionable contract. (Docs. 2 at 8–10; 17 at 8–10.) Again, 16 Plaintiff makes broad assertions without any supporting, articulable facts. Without facts 17 to apply the law to, the Court cannot find that Plaintiff has a likelihood of success on the 18 merits. Factor one is not satisfied. 19 Plaintiff’s remaining arguments that there was fraud and deception on the court, a 20 void ultra vires contract, and that federal racketeering laws have been broken, all generally 21 cite to caselaw without factual support. (See Docs. 2 at 10–13; 17 at 10–13.) For the same 22 reasons as stated above, the Court finds these claims fail factor one. 23 2. Plaintiff has not demonstrated irreparable harm would occur absent a 24 TRO or permanent injunction. 25 Factor two is similarly not met. “Irreparable harm is traditionally defined as harm 26 for which there is no adequate legal remedy, such as an award of damages.” Ariz. Dream 27 Act Coal. v. Brewer, 757 F.3d 1053, 1068 (9th Cir. 2014). Likewise, harms that can later 28 be remedied by an award of damages does not traditionally constitute an irreparable harm. 1 United States v. Gear Box Z Inc., 526 F.Supp.3d 522, 529 (D. Ariz. 2021). Here, Plaintiff 2 has a heading dedicated to irreparable injury. (See Docs. 2 at 7; 17 at 7.) Yet, Plaintiff 3 fails to assert any irreparable harm at all, and merely repeats arguments regarding the 4 legality of the foreclosure. Moreover, Plaintiff’s Motions demand $25.5 million in 5 damages, further indicating that Plaintiff has failed to allege irreparable harm if a TRO or 6 permanent injunction is not granted. (See Docs. 2 at 2; 17 at 2); see also Gear Box Z Inc., 7 526 F.Supp.3d at 529. Factor two therefore fails. 8 3. The balance of equities does not tip in Plaintiff’s favor. 9 To satisfy factor three of the Winter test, the balance of hardships must tip sharply 10 in plaintiff’s favor. All. for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1133 (9th Cir. 11 2011). Plaintiff fails to demonstrate this. As Defendants point out, between 2016 and 12 2021, Plaintiff was repeatedly contacted with offers for loan payment assistance by both 13 BANA and SPS. (Doc. 9 at 11.) It was not until 2022 that Plaintiff faced a foreclosure 14 sale and eviction. As discussed above, Plaintiff fails to cite legal authority or articulable 15 facts demonstrating any viable claim for unlawfulness on behalf of the Defendants or the 16 property’s foreclosure. Plaintiff also does not state any irreparable harm or injury because 17 of the foreclosure and pending eviction. Plaintiff thus does not satisfy factor three. 18 4. Public interest does not favor injunctive relief. 19 “The public interest inquiry primarily addresses impact on non-parties rather than 20 parties, and takes into consideration the public consequences in employing the 21 extraordinary remedy of injunction.” hiQ Labs, Inc. v. LinkedIn Corp., 31 F.4th 1180, 22 1202 (9th Cir. 2022) (cleaned up). Here, Plaintiff has failed to articulate facts or legal 23 authority that supports a likelihood that Defendants acted under an invalid Loan 24 Agreement, Deed of Trust, or secured interest in the property. In contrast, Defendants have 25 provided documents, factual allegations, and legal authority to support the lawfulness of 26 the foreclosure sale—as well as nearly five years of collective efforts to provide Plaintiff 27 with loan repayment assistance opportunities. Courts will not find that a TRO is in the 28 public interest when “it would shield debtors from the agreed-upon repercussions of a || failure to repay debt.” Karam y. Specialized Loan Servicing LLC, No. CV-22-00029-TUC- RCC, 2022 WL 2439220, at *2 (D. Ariz. July 5, 2022). For these reasons, Plaintiff has not || satisfied factor four. IV. CONCLUSION 5 Accordingly, 6 IT IS ORDERED denying Plaintiff's Motions for a TRO and permanent injunction. (Docs. 2; 17.) 8 IT IS FURTHER ORDERED denying Defendants’ Motion to Strike as moot. (Doc. 28.) 10 Dated this 18th day of November, 2022. 11 12 Se . ~P 13 SO 14 A Snited States District hades. 15 16 17 18 19 20 21 22 23 24 25 26 27 28

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