(PS) Espinoza v. Mroczek

CourtDistrict Court, E.D. California
DecidedJanuary 17, 2024
Docket2:23-cv-00228
StatusUnknown

This text of (PS) Espinoza v. Mroczek ((PS) Espinoza v. Mroczek) is published on Counsel Stack Legal Research, covering District Court, E.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
(PS) Espinoza v. Mroczek, (E.D. Cal. 2024).

Opinion

1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 FOR THE EASTERN DISTRICT OF CALIFORNIA 9 10 RAMON L. ESPINOZA, Case No. 2:23-cv-00228-TLN-JDP (PS) 11 Plaintiff, ORDER 12 v. DENYING PLAINTIFF’S MOTION TO STRIKE 13 RICK MROCZECK, et al., ECF No. 11 14 Defendants. FINDINGS AND RECOMMENDATIONS 15 THAT DEFENDANTS’ MOTION TO 16 DISMISS BE GRANTED AND THE FIRST AMENDED COMPLAINT BE DISMISSED 17 WITH LEAVE TO AMEND 18 ECF No. 13 19 OBJECTIONS DUE WITHIN FOURTEEN DAYS 20

21 22 In this wrongful foreclosure action, defendants Rick Mroczek; ZBS Law, LLP; and 23 LoanCare, LLC, move to dismiss plaintiff’s first amended complaint (“FAC”) under Federal Rule 24 of Civil Procedure 12(b)(6) for failure to state a claim.1 ECF No. 13. Defendant Geoffrey Neal 25 joins the other defendants’ motion. ECF No. 18. Because plaintiff fails to state any plausible 26 27 1 Defendant ZBS Law, LLP, was erroneously sued as ZBS Law LLP. Defendant 28 LoanCare, LLC, was erroneously sued as LoanCare LLC. See ECF No. 13 at 2. 1 claim for relief, I recommend that the motion to dismiss be granted.2 2 Plaintiff’s Allegations in the FAC 3 While the FAC contains mostly disjointed and conclusory contentions that lack factual 4 support, the court discerns the following allegations that appear to challenge the legitimacy of the 5 non-judicial foreclosure sale of plaintiff’s former property: in November 2012, plaintiff 6 purchased a home in Stockton, California, and obtained a mortgage loan. ECF No. 7 at 1, 10. He 7 asserts that “the original debt was actually zero because [his] financial asset was exchanged” for a 8 promissory note “in an even exchange.” Id. at 10. The promissory note “never became a 9 registered security.” Id. at 11. From January 2013 until November 2015, plaintiff made timely 10 mortgage payments. Id. at 13. In May 2016, July 2018, and September 2019, defendant 11 LoanCare, LLC, initiated foreclosure proceedings when plaintiff fell behind on his mortgage 12 payments. On each occasion, plaintiff avoided foreclosure by paying for reinstatement. Id. On 13 August 19, 2022, a notice of default was issued and signed by defendant Rick Mroczek, an 14 attorney who works for defendant ZBS Law, LLP. On January 9, 2023, plaintiff received a notice 15 of trustee sale. Also on January 9, 2023, plaintiff’s property was sold at a foreclosure sale. Id. at 16 14. The foreclosure sale, however, is void because defendant Mroczek did not have legal 17 authority to sign the notice of default letter on behalf of the trustee, or to execute the sale. Id. at 18 1-2. After the foreclosure sale, defendants LoanCare, LLC, and ZBS Law, LLP, along with an 19 attorney who “operat[ed] the Foreclosure Services,” sent false information about plaintiff to 20 various credit reporting agencies, causing his credit to be “impaired.” Id. at 14. 21 Legal Standard 22 A complaint may be dismissed for “failure to state a claim upon which relief may be 23 granted.” Fed. R. Civ. P. 12(b)(6). Dismissal under Rule 12(b)(6) may be based on either: 24 25 26 27 2 Pursuant to Local Rule 230(g), the hearing date, originally set for June 8, 2023, was 28 vacated and the motion was ordered submitted without oral argument. See ECF No. 19. 1 (1) lack of a cognizable legal theory, or (2) insufficient facts under a cognizable legal theory. 2 Chubb Custom Ins. Co. v. Space Sys./Loral, Inc., 710 F.3d 946, 956 (9th Cir. 2013). 3 To survive a Rule 12(b)(6) motion, a plaintiff must allege “enough facts to state a claim to 4 relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A 5 claim has “facial plausibility when the plaintiff pleads factual content that allows the court to 6 draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. 7 Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556). The plausibility standard is 8 not akin to a “probability requirement,” but it requires more than a sheer possibility that a 9 defendant has acted unlawfully. Iqbal, 556 U.S. at 678. 10 When determining a Rule 12(b)(6) motion, the court must accept all well-pleaded material 11 factual allegations as true, but not legal conclusions. Iqbal, 556 U.S. at 678. The Supreme Court 12 has explained that complaints consisting only of “labels and conclusions” or “formulaic 13 recitation[s] of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555. 14 Likewise, a complaint is deficient if it presents nothing more than “naked assertion[s]” without 15 “further factual enhancement.” Id. at 557. 16 The court construes a pro se litigant’s complaint liberally. See Haines v. Kerner, 404 U.S. 17 519, 520 (1972) (per curiam). The court may dismiss a pro se litigant’s complaint “if it appears 18 beyond doubt that the plaintiff can prove no set of facts in support of his claim which would 19 entitle him to relief.” Hayes v. Idaho Corr. Ctr., 849 F.3d 1204, 1208 (9th Cir. 2017). However, 20 “‘a liberal interpretation of a civil rights complaint may not supply essential elements of the claim 21 that were not initially pled.’” Bruns v. Nat’l Credit Union Admin., 122 F.3d 1251, 1257 (9th Cir. 22 1997) (quoting Ivey v. Bd. of Regents, 673 F.2d 266, 268 (9th Cir. 1982)). 23 Discussion 24 The FAC contains conclusory assertions and statements referencing legal terms and 25 authorities that, even when liberally construed, fail to establish a plausible claim for relief against 26 any defendant. As shown in the following excerpts from the FAC, plaintiff repeatedly alleges 27 legal conclusions without any factual support: “The deed of trust, and the promissory note must 28 always be together, and without the note and the loan accounting entries, the attorney has failed to 1 prove there was any debt, a second fatal flaw to the wrongful foreclosure,” ECF No. 7 at 8; 2 “[T]he defendant is guilty of violating Federal Laws when he signed the default letter on behalf of 3 the trustee without legal documentation to verify legal authority,” id. at 5; “The defendants 4 further complicated the fraudulent process by selling their payables to another entity to remove it 5 from their balance sheet,” id. at 11; and “The contract should be rescinded because the defendant 6 LoanCare LLC, did not provide full disclosure, the contract is extremely deceptive and 7 unconscionable,” id. at 12. 8 Other allegations in the FAC are nonsensical, such as: “The Supreme Court ruled lawyers 9 and attorneys are NOT licensed to practice law, the nature of lawyer-craft in America as per the 10 United States Supreme Court,” ECF No. 7 at 4; and “[C]ontracts requiring lawful money are 11 illegal,” id. at 11. Additionally, the FAC contains contradictory allegations concerning plaintiff’s 12 mortgage: plaintiff alleges that he obtained a mortgage loan in 2012, but subsequently claims that 13 he “was never provided a loan.” Id. at 10.

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Bluebook (online)
(PS) Espinoza v. Mroczek, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ps-espinoza-v-mroczek-caed-2024.