James Song v. Mtc Financial, Inc.

• Court: Court of Appeals for the Ninth Circuit
• Decided: July 17, 2020
• Docket: 19-15144
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS JUL 17 2020 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

JAMES S. SONG; ADRIENNE SONG, No. 19-15144

Plaintiffs-Appellants, D.C. No. 2:18-cv-00757-JCM-PAL

v. MEMORANDUM* MTC FINANCIAL, INC., DBA Trustee Corps; et al.,

Defendants-Appellees.

Appeal from the United States District Court for the District of Nevada James C. Mahan, District Judge, Presiding

Submitted July 14, 2020** San Francisco, California

Before: TALLMAN and HUNSAKER, Circuit Judges, and SILVER,*** District Judge.

James and Adrienne Song (“Songs”) appeal district court orders denying the

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). *** The Honorable Roslyn O. Silver, United States District Judge for the District of Arizona, sitting by designation. Songs’ motion to remand; granting MTC Financial, Inc., et al.’s (“Defendants”)

motion to dismiss; and denying the Songs’ motion for reconsideration. We have

jurisdiction under 28 U.S.C. § 1291. Reviewing de novo, we affirm the remand

order in full and the dismissal order in part. See Proctor v. Vishay Intertechnology

Inc., 584 F.3d 1208, 1218 (9th Cir. 2009) (remand order); ASARCO, LLC v. Union

Pac. R.R. Co., 765 F.3d 999, 1004 (9th Cir. 2014) (dismissal order). Because we

remand the dismissal order, we review the district court’s denial of the Songs’

reconsideration motion only for jurisdiction, and we affirm.

On the remand order: The district court properly rejected the Songs’

arguments that Defendants’ removal notice was deficient and that Defendants

waived their ability to remove. Counsel for one of the Defendants, PHH Mortgage

Corporation, “asserted” in the notice that the other Defendants “consent[] to the

removal.” That is “fully sufficient” under controlling precedent. See Proctor, 584

F.3d at 1225. And Defendants did not “clear[ly] and unequivocal[ly]” waive

removal by opposing the Songs’ preliminary injunction motion, which was a

“necessary defensive action.” Kenny v. Wal-Mart Stores, Inc., 881 F.3d 786, 790

(9th Cir. 2018) (quoting Resolution Tr. Corp. v. Bayside Developers, 43 F.3d 1230,

1240 (9th Cir. 1994)). Nor did Defendants waive removal by invoking Nevada’s

ministerial mechanism for automatically removing judges based on a one-time

peremptory challenge, see Nev. Sup. Ct. R. 48.1 ¶¶ 1–2, which falls “short of

2 19-15144 proceeding to an adjudication on the merits,” see Kenny, 881 F.3d at 790 (quoting

Resolution Tr. Corp., 43 F.3d at 1240).

On the dismissal order: The district court concluded that all seven of the

Songs’ claims “sound[ed] in wrongful foreclosure” and erroneously dismissed the

entire case because the Songs failed to allege that they did not default on their

mortgage. It is clear that, in Nevada, “no default” is an element of a wrongful

foreclosure claim. See Collins v. Union Fed. Sav. & Loan Ass’n, 662 P.2d 610,

623 (Nev. 1983). But it is far from clear that a plaintiff must allege “no default”

before bringing discrete claims that relate to foreclosure, where none of those

claims individually require proof of “no default.”

The record does support dismissal of the Songs’ declaratory judgment claim:

contrary to the Songs’ argument, Defendants can nonjudicially foreclose more than

six years after the Songs’ default. See Facklam v. HSBC Bank USA, 401 P.3d

1068, 1071 (Nev. 2017) (en banc). And, in any case, the second notice of default

was rescinded on March 20, 2013, thus “render[ing] moot disputes concerning the

notice of default or its timing.” Holt v. Reg’l Tr. Servs. Corp., 266 P.3d 602, 606

(Nev. 2011). The fourth notice of default was filed on March 16, 2017, meaning

that the foreclosure would have been timely even if the six-year statute of

limitations applied.

The record does not otherwise support dismissal of the Songs’ promissory

3 19-15144 estoppel, intentional misrepresentation, negligent misrepresentation, fraud, civil

conspiracy, and slander of title claims. We remand for the district court to

consider whether those individual claims are plausible. The Songs, on remand, can

move the district court to amend their complaint if they wish.

On the reconsideration order: The district court had jurisdiction to dismiss

the Songs’ case while the interlocutory appeal was pending. See Plotkin v. Pac.

Tel. & Tel. Co., 688 F.2d 1291, 1293 (9th Cir. 1982) (“[I]t is firmly established

that an appeal from an interlocutory order does not divest the trial court of

jurisdiction to continue with other phases of the case.”). Because we remand the

dismissal order, we do not consider the Songs’ other arguments on reconsideration.

The parties shall bear their own costs.

AFFIRMED in part and REMANDED with instructions.

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