1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 EASTERN DISTRICT OF CALIFORNIA 8
9 ROBERT ROW SMITH et al., No. 1:25-cv-01397-KES-SKO 10 Plaintiff, ORDER GRANTING TEMPORARY 11 v. RESTRAINING ORDER 12 AMERICAN AGCREDIT, FLCA, et al., (Doc. 4) 13 Defendants. 14 15 16 17 Plaintiffs Robert Row Smith and Diana Veronica Smith move ex parte for a temporary 18 restraining order seeking injunctive relief to enjoin defendants American AgCredit, FLCA 19 (“AgCredit”) and Total Lender Solutions (“TLS”) from selling, transferring, encumbering, or 20 otherwise taking any action to disturb plaintiffs possession or title of the property located at 21 14625 Le Grand Road, Le Grand Area, CA 95333 (“Property”). 22 October 20, 2025, plaintiffs filed a complaint in this Court, alleging causes of action for 23 (1) violation of California Civil Code § 2924 et seq; (2) wrongful foreclosure; (3) breach of the 24 covenant of good faith and fair dealing; (4) violation of 12 U.S.C. § 2605; (5) violation of the 25 Business & Professions Code § 17200; (6) cancellation of instruments; and (7) declaratory relief. 26 Doc. 1. The same day, plaintiffs filed an ex parte application for temporary restraining order, 27 arguing that they were entitled to injunctive relief to prevent the trustee’s sale of their Property set 28 1 for October 22, 2025, because defendants failed to comply with various statutory obligations. 2 Doc. 4. 3 The Court finds that the requirements for issuing a temporary restraining order without 4 notice are met. See Fed. R. Civ. P. 65(b). Plaintiffs notified defendants on October 20, 2025, by 5 email to various email addresses for AgCredit and TLS, that they would seek ex parte relief to 6 enjoin the trustee’s sale. See Doc. 4-1. While defendants have not appeared or filed a response, 7 plaintiffs have set out specific facts demonstrating that immediate and irreparable injury, loss, or 8 damage may result before defendants can be heard in opposition. 9 I. Background 10 On August 18, 2022, plaintiffs obtained a loan against the Property and executed a Deed 11 of Trust that listed AgCredit as trustee and beneficiary. Doc. 4-2; see also Smith Decl. ¶ 3. 12 AgCredit substituted TLS as trustee of the deed of trust and recorded that document with the 13 Merced County recorder’s office. Smith Decl. ¶ 4. On June 5, 2025, a notice of default and 14 election to sell was recorded, which plaintiffs allege contains an inaccurate default amount of 15 $216,991.57. Id. ¶ 5. Plaintiffs further contend that TLS did not mail the notice of default to 16 plaintiffs until July 3, 2025, and that plaintiffs received the notice of default only on or around 17 August 22, 2025. Id. Additionally, a review of the documents reveals that the assessor’s parcel 18 number (“APN”) listed on the notice of default is different from the APN listed on the deed of 19 trust. Id. A notice of trustee’s sale was recorded on September 12, 2025, setting a sale date of 20 October 22, 2025, at 12:30 p.m. Id. ¶ 6. The APN listed in the notice of trustee’s sale is also 21 different than the APN listed in the deed of trust. Id. 22 Plaintiffs also represent that, prior to the government shutdown on October 1, 2025, they 23 were coordinating with the Farm Service Agency (“FSA”) at the U.S. Department of Agriculture 24 for new financing to avoid foreclosure. Id. ¶ 7. Plaintiffs represent that they informed AgCredit 25 that they had established a feasible plan to resolve the matter and were actively working with the 26 FSA to finalize the process, and they requested that the scheduled foreclosure sale be postponed 27 due to the federal government shutdown. Id. ¶ 9. On September 29, 2025, plaintiffs requested 28 various documents from AgCredit, but they did not receive the requested documents from 1 AgCredit. Id. ¶ 8. AgCredit declined to postpone the foreclosure sale, which is scheduled for 2 October 22, 2025, at 12:30 p.m. Id. 3 II. Legal Standard 4 The standards for issuing a temporary restraining order and a preliminary injunction are 5 “substantially identical.” See Stuhlbarg Int’l Sales Co. v. John D. Bush & Co., 240 F.3d 832, 839 6 n.7 (9th Cir. 2001). “A preliminary injunction is an extraordinary remedy never awarded as of 7 right.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 24 (2008) (citing Munaf v. Geren, 553 8 U.S. 674, 689–90 (2008)). “A plaintiff seeking a preliminary injunction must establish that he is 9 likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of 10 preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the 11 public interest.” Id. at 20 (citing Munaf, 553 U.S. at 689–90; Amoco Prod. Co. v. Vill. of 12 Gambell, AK, 480 U.S. 531, 542 (1987); Weinberger v. Romero-Barcelo, 456 U.S. 305, 311–12 13 (1982)). “Likelihood of success on the merits is a threshold inquiry and is the most important 14 factor.” Simon v. City & Cnty. of San Francisco, 135 F.4th 784, 797 (9th Cir. 2025) (quoting 15 Env’t Prot. Info. Ctr. v. Carlson, 968 F.3d 985, 989 (9th Cir. 2020)). “[I]f a plaintiff can only 16 show that there are serious questions going to the merits—a lesser showing than likelihood of 17 success on the merits—then a preliminary injunction may still issue if the balance of hardships 18 tips sharply in the plaintiff's favor, and the other two Winter factors are satisfied.” Friends of the 19 Wild Swan v. Weber, 767 F.3d 936, 942 (9th Cir. 2014) (internal quotation marks and citations 20 omitted). 21 III. Discussion 22 a. Plaintiffs are Likely to Succeed on the Merits 23 Plaintiffs allege that defendants violated various statutory provisions and that such 24 violations entitle them to injunctive relief. For example, plaintiffs argue that defendants failed to 25 timely mail the notice of default as required by California Civil Code Section 2924b. California 26 Civil Code Section 2924b(b) provides, in part, that a mortgagee, trustee or other person 27 authorized to record the notice of default must:
28 1 Within 10 business days following recordation of the notice of default, deposit or cause to be deposited in the United States mail an envelope, sent by registered or 2 certified mail with postage prepaid, containing a copy of the notice with the recording date shown thereon, addressed to each person whose name and address 3 are set forth in a duly recorded request therefor, directed to the address designated 4 in the request and to each trustor or mortgagor at his or her last known address if different than the address specified in the deed of trust or mortgage with power of 5 sale. 6 Cal. Civ. Code § 2924b(b)(1). 7 Plaintiffs assert that, although the notice of default was recorded on June 5, 2025, 8 defendants did not mail the notice of default until July 3, 2025, well past the required 10 business 9 days to mail the notice to the plaintiffs.
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1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 EASTERN DISTRICT OF CALIFORNIA 8
9 ROBERT ROW SMITH et al., No. 1:25-cv-01397-KES-SKO 10 Plaintiff, ORDER GRANTING TEMPORARY 11 v. RESTRAINING ORDER 12 AMERICAN AGCREDIT, FLCA, et al., (Doc. 4) 13 Defendants. 14 15 16 17 Plaintiffs Robert Row Smith and Diana Veronica Smith move ex parte for a temporary 18 restraining order seeking injunctive relief to enjoin defendants American AgCredit, FLCA 19 (“AgCredit”) and Total Lender Solutions (“TLS”) from selling, transferring, encumbering, or 20 otherwise taking any action to disturb plaintiffs possession or title of the property located at 21 14625 Le Grand Road, Le Grand Area, CA 95333 (“Property”). 22 October 20, 2025, plaintiffs filed a complaint in this Court, alleging causes of action for 23 (1) violation of California Civil Code § 2924 et seq; (2) wrongful foreclosure; (3) breach of the 24 covenant of good faith and fair dealing; (4) violation of 12 U.S.C. § 2605; (5) violation of the 25 Business & Professions Code § 17200; (6) cancellation of instruments; and (7) declaratory relief. 26 Doc. 1. The same day, plaintiffs filed an ex parte application for temporary restraining order, 27 arguing that they were entitled to injunctive relief to prevent the trustee’s sale of their Property set 28 1 for October 22, 2025, because defendants failed to comply with various statutory obligations. 2 Doc. 4. 3 The Court finds that the requirements for issuing a temporary restraining order without 4 notice are met. See Fed. R. Civ. P. 65(b). Plaintiffs notified defendants on October 20, 2025, by 5 email to various email addresses for AgCredit and TLS, that they would seek ex parte relief to 6 enjoin the trustee’s sale. See Doc. 4-1. While defendants have not appeared or filed a response, 7 plaintiffs have set out specific facts demonstrating that immediate and irreparable injury, loss, or 8 damage may result before defendants can be heard in opposition. 9 I. Background 10 On August 18, 2022, plaintiffs obtained a loan against the Property and executed a Deed 11 of Trust that listed AgCredit as trustee and beneficiary. Doc. 4-2; see also Smith Decl. ¶ 3. 12 AgCredit substituted TLS as trustee of the deed of trust and recorded that document with the 13 Merced County recorder’s office. Smith Decl. ¶ 4. On June 5, 2025, a notice of default and 14 election to sell was recorded, which plaintiffs allege contains an inaccurate default amount of 15 $216,991.57. Id. ¶ 5. Plaintiffs further contend that TLS did not mail the notice of default to 16 plaintiffs until July 3, 2025, and that plaintiffs received the notice of default only on or around 17 August 22, 2025. Id. Additionally, a review of the documents reveals that the assessor’s parcel 18 number (“APN”) listed on the notice of default is different from the APN listed on the deed of 19 trust. Id. A notice of trustee’s sale was recorded on September 12, 2025, setting a sale date of 20 October 22, 2025, at 12:30 p.m. Id. ¶ 6. The APN listed in the notice of trustee’s sale is also 21 different than the APN listed in the deed of trust. Id. 22 Plaintiffs also represent that, prior to the government shutdown on October 1, 2025, they 23 were coordinating with the Farm Service Agency (“FSA”) at the U.S. Department of Agriculture 24 for new financing to avoid foreclosure. Id. ¶ 7. Plaintiffs represent that they informed AgCredit 25 that they had established a feasible plan to resolve the matter and were actively working with the 26 FSA to finalize the process, and they requested that the scheduled foreclosure sale be postponed 27 due to the federal government shutdown. Id. ¶ 9. On September 29, 2025, plaintiffs requested 28 various documents from AgCredit, but they did not receive the requested documents from 1 AgCredit. Id. ¶ 8. AgCredit declined to postpone the foreclosure sale, which is scheduled for 2 October 22, 2025, at 12:30 p.m. Id. 3 II. Legal Standard 4 The standards for issuing a temporary restraining order and a preliminary injunction are 5 “substantially identical.” See Stuhlbarg Int’l Sales Co. v. John D. Bush & Co., 240 F.3d 832, 839 6 n.7 (9th Cir. 2001). “A preliminary injunction is an extraordinary remedy never awarded as of 7 right.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 24 (2008) (citing Munaf v. Geren, 553 8 U.S. 674, 689–90 (2008)). “A plaintiff seeking a preliminary injunction must establish that he is 9 likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of 10 preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the 11 public interest.” Id. at 20 (citing Munaf, 553 U.S. at 689–90; Amoco Prod. Co. v. Vill. of 12 Gambell, AK, 480 U.S. 531, 542 (1987); Weinberger v. Romero-Barcelo, 456 U.S. 305, 311–12 13 (1982)). “Likelihood of success on the merits is a threshold inquiry and is the most important 14 factor.” Simon v. City & Cnty. of San Francisco, 135 F.4th 784, 797 (9th Cir. 2025) (quoting 15 Env’t Prot. Info. Ctr. v. Carlson, 968 F.3d 985, 989 (9th Cir. 2020)). “[I]f a plaintiff can only 16 show that there are serious questions going to the merits—a lesser showing than likelihood of 17 success on the merits—then a preliminary injunction may still issue if the balance of hardships 18 tips sharply in the plaintiff's favor, and the other two Winter factors are satisfied.” Friends of the 19 Wild Swan v. Weber, 767 F.3d 936, 942 (9th Cir. 2014) (internal quotation marks and citations 20 omitted). 21 III. Discussion 22 a. Plaintiffs are Likely to Succeed on the Merits 23 Plaintiffs allege that defendants violated various statutory provisions and that such 24 violations entitle them to injunctive relief. For example, plaintiffs argue that defendants failed to 25 timely mail the notice of default as required by California Civil Code Section 2924b. California 26 Civil Code Section 2924b(b) provides, in part, that a mortgagee, trustee or other person 27 authorized to record the notice of default must:
28 1 Within 10 business days following recordation of the notice of default, deposit or cause to be deposited in the United States mail an envelope, sent by registered or 2 certified mail with postage prepaid, containing a copy of the notice with the recording date shown thereon, addressed to each person whose name and address 3 are set forth in a duly recorded request therefor, directed to the address designated 4 in the request and to each trustor or mortgagor at his or her last known address if different than the address specified in the deed of trust or mortgage with power of 5 sale. 6 Cal. Civ. Code § 2924b(b)(1). 7 Plaintiffs assert that, although the notice of default was recorded on June 5, 2025, 8 defendants did not mail the notice of default until July 3, 2025, well past the required 10 business 9 days to mail the notice to the plaintiffs. Plaintiffs’ declaration shows that they were not provided 10 with notice of the recordation of the notice of default within the prescribed statutory period. On 11 this record, the plaintiffs are likely to succeed on their claim that defendants violated California 12 Civil Code Section 2924b(b)(1). 13 b. Plaintiffs Will Face Irreparable Harm Without Injunctive Relief 14 The loss of the plaintiffs’ Property via a foreclosure sale constitutes an immediate and 15 irreparable harm. See Kilgore v. Wells Fargo Home Mortg., No. 1:12-CV-00899 AWI, 2012 WL 16 2195656, at *1 (E.D. Cal. June 13, 2012) (finding that the loss of plaintiff’s residence was 17 sufficient to satisfy the irreparable harm Winters factor). 18 c. Balance of Equities 19 The balance of equities favors the plaintiffs. Defendants’ interests are secured by the deed 20 of trust and further briefing will allow defendants to provide evidence before any preliminary 21 injunction is issued in this action. Allowing the foreclosure sale to take place would change the 22 remedies available to plaintiffs, see Morris v. JPMorgan Chase Bank, N.A., 78 Cal. App. 5th 279, 23 315, 293 (2022), and maintaining the status quo by a short postponement of the trustee’s sale until 24 the Court can fully hear the parties is appropriate. 25 d. Public Interest 26 The public interest also weighs in plaintiffs’ favor. The public has an interest in 27 regulating foreclosure proceedings. Moreover, allowing a foreclosure sale to proceed could harm 28 third parties, including a bona fide purchaser who risks having the purchase of the sale set aside 1 | or incurring expense to protect their interest in the Property. 2 IV. Conclusion and Order 3 The Court finds that the requirements for issuing a temporary restraining order are met. 4 | Plaintiffs’ ex parte application for temporary restraining order, Doc. 4, is GRANTED. 5 | Defendants are restrained and enjoined until November 4, 2025 from selling, transferring, 6 | encumbering, or otherwise taking any action to disturb plaintiffs’ possession or title to the 7 | Property. 8 Defendants are ORDERED TO SHOW CAUSE before this Court why a preliminary 9 | injunction should not issue pending a final disposition of this matter. The hearing on the order to 10 | show cause will be held on November 3, 2025, at 11:30 a.m. in Courtroom 6.! Defendants shall 11 | file any response to plaintiffs’ motion by October 28, 2025. Plaintiffs may file a reply by 12 | October 31, 2025. The parties may stipulate to extend the briefing schedule and hearing date, 13 || provided that this temporary restraining order will remain in effect pending any such continuance. 14 Plaintiffs’ counsel is ordered to serve a copy of this order promptly on defendants and to 15 | file a proof of service on the docket by October 22, 2025. 16 Dated and signed: October 21, 2025, at 6:13 p.m. 17 '8 IT IS SO ORDERED. _ 19 4h Dated: _ October 21, 2025 20 UNITED STATES DISTRICT □ 21 22 23 24 25 26 27 ' Counsel requesting to appear at the hearing by video appearance shall contact the courtroom 28 | deputy at least 24 hours prior to the hearing.