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[email protected]
322 Culver Blvd., #144
Los Angeles, California 90293
Tel. (310) 944-2055
Fax (310) 760-4181
Legal Document Assistant, In Pro Per
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SUPERIOR COURT OF THE STATE OF CALIFORNIA
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COUNTY OF LOS ANGELES, CENTRAL DISTRICT
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Plaintiffs,
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v.
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HOME LOAN SERVICES, INC., a Delaware )
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corporation, doing business as FIRST
FRANKLIN LOAN SERVICES; MERRILL
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LYNCH BANK and TRUST COMPANY: Bank )
of AMERICA: FIRST FRANKLIN FINANCIAL )
CORPORATION a subsidiary of NATIONAL )
CITY BANK OF INDIANA: THE PNC
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FINANCIAL SERVICES GROUP, INC, a
Pennsylvania corporation; FIRST AMERICAN )
LOANSTAR TRUSTEE SERVICES, a Texas )
corporation; DEUTSCHE BANK NATIONAL )
TRUST COMPANY, AS TRUSTEE FOR
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FFMLT TRUST 2005-FF2, MORTGAGE
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PASS-THROUGH CERTIFICATES, SERIES
2005-FF2, its successors and/or assigns, and )
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all persons claiming by, through, or under
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such persons and all persons unknown,
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claiming any legal or equitable right, title,
estate, lien or interest in the property
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described in the complaint named as DOES 1 )
through 25
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Defendants.
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PARALEGAL LOS ANGELES,
www.LegalNoodle.com
CASE NO: Insert Your Number Here
Complaint filed on January 8, 2010
Assigned for all purposes to Dept 99
Hon. Joe Bama
VERIFIED FIRST AMENDED
COMPLAINT FOR:
1) DECLARATORY RELIEF
2) VIOLATION OF FAIR DEBT
PRACTICES ACT
3) FRAUD AND DECEIT
4) INTENTIONAL INFLICTION OF
EMOTIONAL DISTRESS
5) NEGLIGENT INFLICTION OF
MOTIONAL DISTRESS
6) UNFAIR BUSINESS PRACTICES
7) QUIET TITLE
Unlimited Civil Jurisdiction
Exceeds $25,000
DEMAND FOR JURY TRIAL
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Plaintiff alleges the following on his own personal knowledge, except as to those
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VERFIED FIRST AMENDED COMPLAINT
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matters stated on information and belief, and as to those matters, plaintiff believes them to be
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true.
INTRODUCTION
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1.
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Plaintiff brings this action against Deutsche Bank National Trust Company
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(Deutsche) as Trustee for First Franklin Mortgage Loan Trust 2005-FF2 (FFMLT) and First
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Franklin Financial Corporation, a subsidiary of National City Bank of Indiana (FFFNCBI) First
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Franklin Financial Corp., (FFFC) Home Loan Services, Inc. doing business as First Franklin
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Loan Services (HLS) First American Loanstar Trustee (Trustee) PNC Financial Services
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Group (PNC) Bank of America (B of A) Merrill Lynch Bank and Trust Company (Merrill Lynch)
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and Does 1 through 25 (collectively as defined below Defendants) based in part on
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Defendants failure to comply with section 2932.5 of the Code of Civil Procedure which
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governs the power of sale under an assigned mortgage and Bus. & Prof. Code Section
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17200, et seq. (17200) various other provisions of the California Civil Code, various provisions
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of the Financial Code, and other statutory and common law in effect.
2.
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On or about November 18, 2004, Plaintiff borrowed money from FFFNCBI and
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executed a promissory note in favor of FFFNCBI of the same date (Note) Plaintiff also
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executed a Deed of Trust granting FFFNCBI a security interest in Plaintiff’s property (Deed of
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Trust.)
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3.
On April 1, 2008, FFFNCBI allegedly assigned the Deed of Trust to Deutsche.
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By virtue of this alleged assignment, Deutsche apparently claims that it was the beneficiary of
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the promissory Note and Deed of Trust.
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4.
It is undisputed that FFFNCBI held a security interest in the Plaintiff’s property
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by virtue of the Deed of Trust. Plaintiff maintains the assignment was fraudulently executed by
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a non-officer of a defunct corporation. The sole evidence provided is an assignment from
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FFFNCBI in 2008 when that corporation ceased to function in 2006.
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5.
Section 2932.5 of the California Civil Code requires a valid assignment from a
properly constituted assignor executed by an officer designated to have the power to bind that
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VERFIED FIRST AMENDED COMPLAINT
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operating company.
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Therefore Defendants failed to lawfully comply with California Civil Code Section
2932.5.
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Therefore the Plaintiff seeks Declaratory Relief from this Court to declare the
assignment to Deutsche null and void.
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Defendants must demonstrate to this Court that FFFNCBI had a legal existence
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on the date of the assignment to Deutsche. Further, they must substantiate that the officer of
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FFFNCBI who executed the assignment was in fact authorized to do so by FFFNCBI.
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9.
Because the purported assignment was void, the Notice of Default under Civil
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Code section 2924 and the Notice of Sale under section 2924(f) were not complied with. It
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therefore follows that the foreclosure sale is void.
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10.
In the midst of the post 9/11 American housing market recovery, Wall Street
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firms were buying billions of dollars of subprime loans from non-bank lenders. By the end of
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the bubble in housing and subprime lending, Merrill Lynch was one of the largest firms issuing
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Collateralized Debt Obligations (CDO). After purchasing loans from mortgage originators, they
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would be packaged into Asset Backed Securities (ABS) and sliced up according to risk. The
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riskiest parts of several packages would then be grouped together and further securitized into
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CDOs, and then sold to end investors around the world.
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Merrill Lynch would, of course, generate commissions on every step of the
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process. Warehouse lines of credit were offered to subprime mortgage lenders in order to
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make loans to the public. Once the mortgages had been originated, the investment firm would
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purchase packages of the loans from the originators and securitize them.
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However, Merrill Lynch took the process another step and actually provided
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loans to investors to buy their CDO’s once they had been securitized. Most of the money on
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both ends of the transaction came from the Wall Street firm, increasing their exposure to the
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subprime industry by orders of magnitude. The firm would buy subprime loans from non-bank
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institutions it offered lines of credit to, securitize them into ABS’s, create CDO’s out of the
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VERFIED FIRST AMENDED COMPLAINT
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riskier portions of the ABS’s, then provide more loans to investors to purchase the bonds.
13.
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It is undisputed that Plaintiff’s promissory note found its way to the FFMLT Trust
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2005-FF2. The problem for Defendants was how to get the Deed of Trust to this entity. They
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chose to simply execute an assignment in a fraudulent and illegal manner and assumed the
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act would not be discovered.
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As one of the largest and most prestigious investment firms on Wall Street,
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Merrill Lynch could also aggressively target the subprime market. The banking giant paid
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more for loans than any other Wall Street firm, paying higher premiums for subprime than any
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other investor. As well, it would offer cheap warehouse lines of credit to non-banks to make
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loans as long as they then sold the mortgages to Merrill Lynch for securitization.
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The only piece of the total subprime puzzle that Merrill Lynch was lacking by the
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end of the housing bubble was an origination company. So it purchased FFFC from National
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City Bank (NCB.)
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begun to see the writing on the subprime wall.
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Soon after its ill-fated purchase of FFFC, it was clear that Merrill Lynch had
Merrill Lynch failed and Bank of America took it over with billions of government
funds.
STATEMENT OF FACTS
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This case involves a mortgage foreclosure sale of a residential property in Los
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Angeles that was noticed and conducted by Defendant Deutsche which received an invalid
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assignment of a Deed of Trust in April, 2008 from a discontinued corporation that had no legal
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existence. The Defendant Deutsche then instituted non-judicial foreclosure proceedings on
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Plaintiff’s residential property.
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Here, the Defendant Deutsche was both the foreclosing party and the only
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bidder at the purported sale of Plaintiff’s property. Deutsche allegedly purchased the property
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at a substantial discount from its appraised value wiping out all of Plaintiff’s equity. Plaintiff
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brings this action in part to remove the cloud of title on his property.
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VERFIED FIRST AMENDED COMPLAINT
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20.
The assignor that assigned the Deed of Trust to Deutsche was First Franklin
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Financial Corp, subsidiary of National City Bank of Indiana (FFFNCBI.) The Assignment was
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executed by an alleged officer of this company, Eileen Gonzales. Ms. Gonzales alleges that
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she is a vice president of this corporation that was sold to Defendant Merrill Lynch in 2006.
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21.
National City Bank of Indiana (NCBI) wholly owned and operated FFFC as an
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operating subsidiary in 2004 at the time the loan was made to Plaintiff. Plaintiff owned the
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residential property since 2003.
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22.
NCBI was in turn owned by National City Bank (NCB) which was federally
chartered since 1865 and engaged in the business of banking nationwide, subject to the
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exclusive regulation and oversight of the federal government. NCB’s wholly owned operating
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subsidiary, FFFNCBI serviced and funded mortgages originated by NCB, also on a
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nationwide basis.
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Merrill Lynch acquired FFFC from National City Corporation (NCC) the
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Cleveland, Ohio based holding company of NCB on December 30, 2006. FFFC originated
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primarily subprime mortgage loans for sale in the secondary market. The documents for the
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loan sales and securitization transactions included representations and warranties that, if
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breached, would obligate FFFC to repurchase the loans in certain circumstances. In some
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cases, Merrill Lynch provided guarantees of FFFC’s performance under these transaction
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documents (“Guarantees”).
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24.
Because of the deterioration of the subprime mortgage market, Merrill Lynch
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discontinued mortgage operations at FFFC in March 2008. Merrill Lynch then transferred its
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entire ownership interest in FFFC to Merrill Lynch Mortgage Services Corporation (“MLMSC”),
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an indirect, wholly owned subsidiary of Merrill Lynch.
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25.
Merrill Lynch however, guaranteed the performance of MLMSC with respect to
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certain obligations of FFFC to one or more beneficiaries. The Guarantees were put in place in
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connection with, and in support of, FFFC originated whole loans or securitizations. The
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Guarantees were not subject to the limitations on transactions between a bank and its
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VERFIED FIRST AMENDED COMPLAINT
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affiliates because FFFC was a subsidiary of MLFSB. On consummation of the transaction,
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FFFC was no longer a subsidiary of MLFSB and would become an affiliate of Merrill Lynch.
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PNC agreed to buy Ohio's NCC in a $5.6 billion transaction that would save the
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ailing Cleveland-based bank. The sale was completed on December 30th, 2008 and included
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NCBI which in 2004 owned FFFC.
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NCC has been hit by home loans it held onto after selling its FFFC subprime
mortgage business to Merrill Lynch in 2006.
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PNC 's $5.6 billion agreement to buy ailing regional bank National City Corp.
was the result of pressure applied by NCC’s regulator and billions in capital supplied by the
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Treasury Department,. The deal was a strong statement of the federal government's
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determination to rid the industry of weak banks by pairing them with healthy buyers, which will
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get capital infusions to help absorb the bad loans and other problems they inherit from
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acquired banks.
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B of A reported on January 1, 2009, that it had officially completed the takeover
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of Merrill Lynch for $33 billion in an all stock transaction, ending the 95-year old brokerage
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firm's journey in the wake of worst financial crisis since the Great Depression.
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The merger, which was announced on Sept. 15, 2008, was initially valued at
$50 billion.
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As of December 30, 2008, FFFC operates as a subsidiary of B of A or has
ceased doing business...
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32.
On April 1, 2008, FFFC was owned by MLMSC.
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33.
On the very same date, April 1, 2008, FFFNCBI assigned to Deutsche, the Deed
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of Trust to Plaintiff’s property. A vice president of FFFNCBI, Eileen J. Gonzales signed on
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behalf of the defunct subsidiary of NCBI in front of a Notary Public. That Notary, Eva Gaal,
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stated that Gonzales was an officer of the subsidiary of NCBI. Two individuals, Robert Altman
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and Karen Elizabeth Thorne (both employees of HLS) witnessed the execution.
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34.
In point of time, FFFC ceased to be a subsidiary of NCBI in 2006. Merrill Lynch
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VERFIED FIRST AMENDED COMPLAINT
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owned it in April 2008. Today, NCBI does not exist. It would be impossible for that corporation
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to have assigned anything after December 30th, 2006.
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35.
In March 2008, Merrill Lynch discontinued mortgage operations at FFFC. The
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assignment of the Plaintiff’s Deed of Trust was done in the normal course of Merrill Lynch
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discontinuing its mortgage origination business. The assignment, however, was from a
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defunct corporation and was executed by someone not an officer of that corporation.
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36.
As discussed below, Deutsche was not the valid holder of the Deed of Trust at
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the time of the notice and sale. The loan in question was an adjustable rate, subprime loan for
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plaintiff’s residence in Los Angeles. On November 28, 2004, the Plaintiff signed a promissory
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note and gave an immediately recorded Deed of Trust to the original lender, FFFNCBI. The
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party conducting the sale, Deutsche, must have a valid assignment of the Deed of Trust from
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an entity that validly holds same and is still operational. The party conducting the sale must
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possess valid and relevant paperwork and must have someone with authority to execute the
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relevant paperwork.
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37.
Deutsche and HLS have consistently refused to produce the original Note and
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relevant assignments of the Deed of Trust. The Los Angeles Superior Court unlawful detainer
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action brought in the South District Court in Long Beach (88888888) by Deutsche against
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Plaintiff was dismissed because of this failure. Here, the direction to notice the sale did not
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come from FFFNCBI or Deutsche. It came from HLS in its capacity as the servicer. The
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documents were executed in a fraudulent manner and were void. The Defendant HLS
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prepared fraudulent paperwork at the direction of Merrill Lynch. Without this fraudulent
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paperwork, there could be no assignment of the Deed of Trust on Plaintiff’s property.
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38.
The Plaintiff now resides in a home which Deutsche claims to own by virtue of a
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non-judicial foreclosure proceeding. There are no proceedings to evict the Plaintiff. It is a
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Mexican standoff that requires this action for Declaratory Relief.
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39.
HLS was the Servicer on the Plaintiff’s loan. The loan documents were
supposedly kept by “Custodians.” It is unknown who is the custodian of Plaintiff’s loan
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VERFIED FIRST AMENDED COMPLAINT
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documents. HLS was acquired by Merrill Lynch and then by B of A by virtue of its takeover of
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Merrill Lynch.
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40.
As noted above, the Defendants sold certificates in offerings to investors and
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issued offering documents. These included Private Placement Memorandum and Prospectus
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Supplements. They contained detailed descriptions of the characteristics of the subprime
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residential loans that the trusts were acquiring, the risk factors involved with these loans and
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the documentation that the trusts purportedly would receive in order to obtain and secure their
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interests in the loans and lessen those risks. Despite the requirements for the documentation
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to be in recordable form, it was not done. Plaintiff believes that the collateral file for the loan
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will show that various provisions of the Civil Code were fraudulently adhered to.
41.
Once the securitization process began, generally the Pooling and Servicing
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Agreements required the Depositor to provide to the Deutsche the original mortgage with
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evidence of recording, all original assignments of the Deed of Trust in form and in substance
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acceptable for recording and original copies of any intervening substitutions of trustee
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showing a complete chain of title. The assignments required during this process were from
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the original holder of the Deed of Trust i.e., a subsidiary of NCBI to Merrill Lynch. Without that
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assignment and a subsequent one to Deutsche, there is no clear chain of title and the Deed of
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Trust must stand as originally executed.
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42.
Deutsche has provided no documents to show that Plaintiff’s Note was ever
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assigned to them. Even if the Note were assigned, Deutsche is not the party asserting a
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security interest in the property. Deutsche brought the ill founded foreclosure sale as Trustee
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for FFMLT. There is no record of an assignment to FFMLT.
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43.
Under the pooling and service agreement, the original lender is the responsible
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party and that lender is not in privity with the current trustee because there were no valid
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substitutions recorded. HLS was not receiving instructions from the real beneficiary which has
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changed many times. There are at least three trustees once the securitization process begins.
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The trustee on the Deed of Trust, the trustee of the pooled assets and the trustee for the
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VERFIED FIRST AMENDED COMPLAINT
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owners of certificates of mortgage backed securities. There are also substitutions of trustees
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at all levels. Each of these trustees, in order to be relevant to this case must have acquired
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legally enforceable rights. This can only be done through a document of transfer that identifies
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the Grantor as the party who has the power to appoint a trustee and the attendant powers.
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44.
Plaintiff maintains Deutsche had no legal right in the real property. He further
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maintains there was no valid assignment of the Deed of Trust. It will not be the owner of the
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securities that were issued. The Deed of Trust signed by Plaintiff has been eviscerated by bad
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documentation, cross collateralization, over collateralization, credit default swaps etc. The
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assignment from the subsidiary of NCBI cannot be valid
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45.
At some point, the Plaintiff’s loan became delinquent and a notice of sale was
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received by Plaintiff which listed Deutsche as “the owner (or assignee) and holder of a Trust
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Deed with a statutory power of sale given by Plaintiff to FFFNCBI. This was false. The sale
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was conducted in the name of Deutsche and they were the only bidder.
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46.
Prior to learning all of the above, in good faith, Plaintiff entered into what was
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purported to be a repayment plan and loan modification with HLS. Unbeknownst to Plaintiff
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that "plan" was designed strictly to collect fees prior to foreclosure and nothing more. Plaintiff
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paid to HLS $24,000 over a ninety day period pursuant to oral agreements with many
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representatives of HLS. Once the 90 day repayment period was completed, a loan
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modification agreement was to be entered into between the Plaintiff and Defendants.
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47.
Plaintiff had been working with the Defendant HLS in an attempt to enter into a
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loan modification. The Defendants required (orally) that Plaintiff pay $8,000 per month for a
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three month period commencing in October 2008. Plaintiff’s payments were made through
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Western Union and had to be received by a given date in order to forestall the foreclosure
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sale for thirty days until the next payment was received. After each payment was made,
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Plaintiff phoned Defendants to confirm receipt and the postponement of the sale date.
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48.
Plaintiff successfully completed the 90 day repayment period and began calling
Defendants on a daily basis to confirm that a modification agreement was being prepared. In
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VERFIED FIRST AMENDED COMPLAINT
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addition, Plaintiff made numerous calls to the Defendants to determine how the $24,000 was
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applied to his account. The essential terms of that modification called for all delinquent
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payments to be added to the principal balance of the loan and the new rate would be lower
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than the current rate which taken as a whole would have reduced Plaintiff’s monthly payment
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by approximately $300.00.
49.
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The Defendants required Plaintiff to undergo a grueling process filling out forms,
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compiling bank records and tax returns and faxing them to designated fax numbers.
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Countless times Plaintiff was told that Defendants did not get what was sent or they lost it and
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it needed to be re-sent. Then the representatives of HLS were not available when Plaintiff
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called and he was then transferred to someone else who told him his file is empty, so he was
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required to refax the same documents, forms and information.
50.
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The Defendants represented that once three consecutive payments of $8,000
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were made, the actual modification would be put into place. When asked what the modified
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payments would be, Defendants gave a general figure, but nothing concrete and nothing in
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writing
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51.
Once the loan modification process began many months ago, Plaintiff called
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every other day to see if Defendants needed any further documentation. Plaintiff always
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spoke with a different person and they always seemed to need some other form or some
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information updated.
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52.
Plaintiff finally did receive a modification agreement in mid December, 2008.
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However, it included additional and burdensome terms never discussed with Plaintiff or
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agreed to by him. Upon receipt of same, Plaintiff immediately began calling Defendants.
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Noelle Boehme an employee of Defendant HLS sent the document. Ms. Boehme advised that
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unless Plaintiff signed the document as written, there would be no modification.
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53.
The Defendants were demanding an additional amount of $14,845.15 of which
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$13,929.46 was to be paid immediately by certified funds. Ms. Boehme stated that if the
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payment was not received, the agreement would be terminated. Thereafter Plaintiff phoned
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VERFIED FIRST AMENDED COMPLAINT
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Ms. Boehme daily to discuss the matter. This continued throughout the months of January
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and February 2009. Not one call was returned.
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54.
Without any further notice to Plaintiff, his home was the subject of a non-judicial
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foreclosure proceeding on or about February 20, 2009. Plaintiff became aware of it when a
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stranger knocked on his door to tell him that his home was just sold at a public auction.
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Plaintiff was horrified and in state of shock.
PARTIES
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55.
At all times mentioned herein, Plaintiff was a resident of Los Angeles County,
and the owner of the residence located at 4444 Main Street, Los Angeles, California 90012
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(the "Real Property") pursuant to that certain grant deed vesting title to him. The Real
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Property is legally described as:
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LOT 14 OF TRACT #4444, IN THE CITY OF LOS ANGELES,
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COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER
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MAP RECORDED IN BOOK 200 PAGES 7 TO 14 INCLUSIVE OF
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MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
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COUNTY.
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56.
Defendant HLS is and was a Delaware corporation doing business as First
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Franklin Loan Services. HLS at all times material hereto serviced Plaintiff's loan and has done
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and continues to do business in Los Angeles County, California.
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57.
In or about December 2008, PNC, a Pennsylvania corporation, acquired all
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rights, title, interest and obligations of NCBI, including its subsidiary, FFFC. Plaintiff is
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informed and believes that PNC through its acquisition of NCBI has some financial or other
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interest in the Real Property.
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58.
Defendant Deutsche (a Delaware company doing business in California) as
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Trustee for the First Franklin Mortgage Loan Trust 2005-FF2, Mortgage Pass-Through
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Certificates, Series 2005-FF2 which is the alleged current title owner of the real property.
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59.
Defendant B of A is a Delaware corporation doing business in California.
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VERFIED FIRST AMENDED COMPLAINT
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60.
Defendant Merrill Lynch is a Delaware corporation owned by B of A.
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61.
Defendant First American Loanstar Trustee Services (First American) is and
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was a Texas corporation that purported to foreclose on Plaintiff's home. Plaintiff is informed
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and believes that First American Trustee Services, Inc. has foreclosed and continues to
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foreclose on residences in Los Angeles County without proper documentation. Plaintiff is
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further informed and believes that First American Loanstar Trustee Services, Inc. failed to
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comply with all of California's foreclosure laws in its purported trustee's sale of the Real
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Property. Further, Plaintiff alleges that this Defendant was negligent in the carrying out of its
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obligations.
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62.
Pursuant to section 392 of the Code of Civil Procedure, venue is proper in the
Superior Court of California for the County of Los Angeles.
63.
The Defendants herein named as “all persons unknown claiming any legal or
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equitable right, title, estate, lien or interest in the property described in the complaint named
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as Does 1 through 25” are unknown to Plaintiff. These unknown defendants claim some right,
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title, estate, lien or interest in the Real Property, which are without any right whatsoever and
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therefore these defendants have no right, title, estate, lien or interest in the property or any
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part thereof.
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64.
Plaintiff is informed and believes and thereon alleges that, at all times herein
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mentioned, each of the defendants sued herein was the agent and employee of each of the
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remaining defendants and was at all times acting within the purpose and scope of such
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agency and employment.
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FIRST CAUSE OF ACTION
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(Declaratory Relief Against all Defendants)
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65.
Plaintiff incorporates Paragraphs 1 through 64, inclusive, of this Complaint, as
though fully set forth herein.
66.
That an actual controversy has arisen between Plaintiff and all Defendants, and
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VERFIED FIRST AMENDED COMPLAINT
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Does 1-25, and each of item, relating to the legal rights, duties and obligations of said parties,
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to wit:
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67.
The right of Deutsche to foreclose on the subject property in light of the fact that
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the assignment of the foreclosed Deed of Trust to Deutsche was from a defunct corporation
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and executed by a person having no authority to act for said defunct corporation. At the time
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of the assignment, there was no evidence of the legal capacity of FFFCNCBI to convey the
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Deed of Trust. The party conducting a foreclosure sale must have a valid assignment from the
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holder of the Deed of Trust, i.e., FFFCNCBI.
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68.
The fact that the major entities now revealed as central to the transactions in
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question are presently out of business (NCBI, Merrill Lynch) and their assets sold to PNC or
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Bank of America, both of which sales required billions in government aid.
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69.
The Plaintiff is aware of no case interpreting Section 2932.5 of the Civil Code. A
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mortgage is a contract. It is fundamental and basic that a party seeking to exercise a right
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(here, the power of sale) has the contractual right to do so at the time of its exercise. Only the
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original holder of the Deed of Trust or a valid assignee has that right.
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70.
The Defendants contend there was a valid assignment from a defunct
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corporation executed by an employee of the HLS and not by an authorized officer of
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FFFCNCBI. The Servicer, HLS is owned and controlled by B of A, Merrill Lynch or both.
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71.
Plaintiff desires a judicial determination of the validity of the assignment to
Deutsche and a declaration that the assignment was void.
72.
A judicial declaration is necessary and appropriate at this time under the
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circumstances in order that Plaintiff may ascertain his title to the subject property. The
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unsettled state of affairs has Deutsche claiming title to Plaintiff’s property while Plaintiff is
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residing in said property. Deutsche dismissed the Unlawful Detainer action against Plaintiff in
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November, 2009.
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73.
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That no adequate remedy, other than herein prayed for, exists by which the
rights of the parties hereto may be determined.
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VERFIED FIRST AMENDED COMPLAINT
1
74.
That Plaintiff desires a judicial determination of his and Defendant's rights,
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duties, obligations and interests and a further determination as to the validity of the
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assignment.
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SECOND CAUSE OF ACTION
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(Violation of the Federal Fair Debt Collection Practices Act
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against All Defendants)
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75.
Plaintiff realleges and incorporates by reference all preceding paragraphs.
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76.
The purpose of the Fair Debt Collection Practices Act ("FDCPA") is to eliminate
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abusive debt collection practices. Though limited to debt collectors, creditors are vicariously
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liable for the actions of their debt collectors.
12
77.
Both the HLS and First American are debt collectors under the FDCPA. To the
13
extent the FFFNCBI is not a debt collector, it is vicariously liable for the acts of its Servicer
14
and trustee. Plaintiff is a consumer under the FDCPA. The loan is a consumer loan under the
15
FDCPA. Both the Servicer and trustee have communicated with Plaintiff by mail and
16
telephone to collect on Plaintiff's loan.
17
18
19
20
21
78.
The FDCPA forbids the use of false, deceptive or misleading representation or
means in connection with the collection of a debt.
79.
Under the FDCPA, a debt collector may not use unfair or unconscionable means
to collect or attempt to collect a debt.
80.
In violation of the FDCPA, Defendants made false and deceptive
22
representations to Plaintiff by promising to modify his loan on agreed upon terms if he made
23
three (3) $8,000 payments. After Plaintiff complied, defendants reneged and refused to modify
24
Plaintiff's loan unless he made additional substantial payments which were not part of the
25
original agreement. Such bait and switch tactics are a clear violation of the FDCPA.
26
27
28
81.
Plaintiff alleges that all of the defendants knowingly approved and ratified the
acts of each other defendant.
14
VERFIED FIRST AMENDED COMPLAINT
1
82.
Plaintiff also alleges that the alleged current title owner of the Real Property is
2
not a legal entity and/or not the true holder of the Deed of Trust on Plaintiff’s real property.
3
The statute’s commands are clear and they were violated. Therefore, this alleged title owner
4
cannot legally authorize the HLS or First American to enforce or collect the loan or foreclose
5
upon the security for repayment of such loan.
6
83.
As a direct and proximate result of defendants' violation of California law,
7
Plaintiff has suffered irreparable injury through the loss of title to his home. Therefore, Plaintiff
8
is entitled to, among other things, rescission of the trustee's deed upon sale recorded against
9
the Real Property. Plaintiff is also entitled to statutory damages.
10
11
THIRD CAUSE OF ACTION
12
(Fraud and Deceit against Home Loan Services, Inc.)
13
84.
Plaintiff realleges and incorporates by reference all preceding paragraphs.
14
85.
As alleged above, HLS promised to modify Plaintiff's loan if he made three
15
$8,000 payments, which he timely did. However, HLS did not intend to modify Plaintiff's loan
16
even if Plaintiff made the agreed upon payments and/or failed to disclose to Plaintiff that he
17
would have to pay additional sums on top of the three $8,000 payments before HLS would
18
modify his loan.
19
86.
Plaintiff relied upon the HLS’s misrepresentations and deceit by timely making
20
the three $8,000 payments to HLS. Plaintiff has suffered irreparable injury through the loss of
21
title to his home.
22
87.
HLS has acted as alleged herein with the intent to deprive Plaintiff of property
23
and to injure him such that the actions constitute fraud, oppression, or malice within the
24
meaning of Civil Code § 3294. HLS’s conduct was intended to cause injury to Plaintiff and
25
was carried on by them in willful and conscious disregard of Plaintiff’s rights. HLS’s conduct
26
was despicable, oppressive, and outrageous, justifying the imposition of punitive and
27
exemplary damages against them in amount sufficient to punish and to make an example of
28
15
VERFIED FIRST AMENDED COMPLAINT
1
HLS and to deter such conduct in the future. Plaintiff is informed and believes, and based
2
thereon alleges, that this conduct was authorized, ratified, and otherwise approved of not only
3
by employees of HLS, but also by its managers, supervisors, and agents who speak with
4
authority on their behalf.
5
6
7
88.
The said representations were false, and each time Defendant made them, they
knew they were false.
89.
At the times Defendant made the promises, as well as the time they made said
8
representations, and at the times of the reliance by Plaintiff, he believed that the said
9
representations were true.
10
90.
At all times herein mentioned, Defendant intended to defraud and deceive
11
Plaintiff by causing him to act to his detriment in reliance upon his said belief in the truth of
12
Defendant's said representations.
13
14
15
91.
In reasonable reliance upon Plaintiff's belief in the truth of Defendant's said
representations, Plaintiff paid to Defendant $24,000.
92.
Were it not for Plaintiff's said trust and confidence in Defendant as a fiduciary,
16
and his said reliance upon, and belief in the truth of their said representations, Plaintiff would
17
not have acted as hereinabove alleged.
18
93.
By reason of the said fraud and deceit perpetrated by Defendant in deceiving
19
Plaintiff into acting to his detriment in reliance on promises which Defendant never intended to
20
keep, Defendant acted with malice.
21
94.
By reason of the said malice, Defendant ought to suffer punitive and exemplary
22
damages in an amount in excess of Five Million Dollars ($5,000,000.00) or in a greater
23
amount according to proof of their worth.
24
25
FOURTH CAUSE OF ACTION
26
(For Intentional Infliction of Emotional Distress against Home Loan Services)
27
28
95.
Plaintiff incorporates by reference all previous paragraphs of this complaint as
16
VERFIED FIRST AMENDED COMPLAINT
1
though fully set forth herein.
2
96.
On or about December 1, 2008, HLS repudiated their agreement with Plaintiff.
3
97.
Plaintiff is informed and believes and based thereof alleges that Defendant
4
willfully, maliciously, oppressively and knowingly engaged in the aforementioned acts with a
5
conscious design to deprive Plaintiff of his rights and his home.
6
98.
Defendant's conduct was intentional, malicious, unprivileged, oppressive,
7
outrageous and done for the purpose of causing Plaintiff to suffer humiliation, anguish and
8
emotional and physical distress. Defendant's conduct, as hereinabove set-forth, was done
9
with knowledge that Plaintiff would be caused mental anguish and emotional and physical
10
distress and Defendant's conduct was with a wanton and reckless disregard for the
11
consequences of said actions to Plaintiff.
12
99.
As a direct and proximate result of the aforementioned acts, Plaintiff has
13
suffered humiliation, mental anguish, and emotional and physical injuries, and Plaintiff has
14
suffered loss of energy, loss of sleep, severe tension, profound shock and anxiety, all to
15
plaintiffs’ damages in a sum within the jurisdictional requisites of this Court. Plaintiff will ask
16
leave of Court to amend this Complaint at time of trial to insert the exact amount of said
17
damages.
18
100.
In doing these acts, Defendant acted maliciously and without probably cause
19
and without regard for the rights, health and feelings of Plaintiff, and with intent, design,
20
scheme and purpose to injure Plaintiff.
21
22
101.
Therefore, this Court should award Plaintiff exemplary and punitive damages
against Defendant in a sum in excess of Five Million Dollars ($5,000,000.00).
23
FIFTH CAUSE OF ACTION
24
25
26
27
28
(Negligent Infliction of Emotional Distress against Home Loan Services)
102.
Plaintiff refers to and incorporates herein by this reference each and every
allegation contained in all previous paragraphs of this Complaint as though fully set forth
17
VERFIED FIRST AMENDED COMPLAINT
1
2
3
4
herein.
103.
The aforesaid conduct of Defendant, if not intentional, was negligent on part of
Defendant, was reckless and without due regard for the health and welfare of Plaintiff.
104.
Defendant had a duty to act with due care towards Plaintiff in light of the parties'
5
confidential relationship which existed in that Plaintiff reposed the greatest confidence and
6
trust in Defendant. Said duty was breached as a result of the conduct alleged herein, which
7
has continued through the filing of this Complaint.
8
9
105.
Defendant acted negligently, carelessly, wrongfully and without justification and-
in carrying out their scheme designed to deprive Plaintiff of his rights and property interests.
10
Defendant knew or should have known that Plaintiff would suffer emotional distress as a
11
direct and proximate result of Defendant's conduct.
12
106.
As a direct and proximate result of said negligence and carelessness of
13
Defendant, Plaintiff has suffered humiliation, mental anguish and emotional and physical
14
injuries including loss of sleep, loss of energy, severe tension, profound shock and anxiety, all
15
to Plaintiff's damage within the jurisdictional requisites of this Court. Plaintiff will ask leave of
16
Court to amend this Complaint at time of trial to insert the exact amount of said damages.
17
18
107.
Therefore, this Court should award Plaintiff exemplary and punitive damages
against Defendant in a sum in excess of Five Million Dollars ($5,000,000.00).
SIXTH CAUSE OF ACTION
19
(Unfair Business Practices against All Defendants)
20
21
108.
Plaintiff realleges and incorporates by reference all preceding paragraphs.
22
109.
Plaintiff alleges that by engaging in the above-described acts and practices,
23
Defendants have committed one or more acts of unfair competition within the meaning of
24
California Business and Professions Code §§17200 et seq.
25
110.
Plaintiff alleges that Defendants' unlawful business acts and/or practices as
26
alleged herein have violated numerous laws and/or regulations including, but not limited to,
27
the FDCPA, HOEPA and the California Civil Code.
28
18
VERFIED FIRST AMENDED COMPLAINT
1
111.
Defendants' misconduct, as alleged herein, gave defendants an unfair
2
competitive advantage over their competitors, and in turn constitutes a pattern and practice of
3
conducting unlawful foreclosure practices.
4
112.
Plaintiff alleges that the unlawful acts and practices, as fully described herein,
5
present a continuing threat to members of the public to be misled and/or deceived by
6
Defendants. Plaintiff has no other remedy at law that will prevent Defendants' misconduct, as
7
alleged herein, from occurring and/or recurring in the future.
8
9
10
113.
Plaintiff seeks the imposition of a constructive trust over, and restitution of the
monies collected and realized by defendants as a result of their unlawful acts and practices.
114.
Plaintiff alleges that as a direct and proximate result of defendants' unlawful
11
conduct alleged herein, Plaintiff has lost thousands of dollars in equity in his home. Plaintiff is
12
a direct victim of defendants' unlawful conduct, as alleged herein, and has suffered injury in
13
fact, and has lost money as a result of defendants' unlawful business practices.
14
115.
Plaintiff alleges that he is entitled to equitable relief, including restitution,
15
restitutionary disgorgement of all profits accruing to defendants because of their unlawful and
16
deceptive acts and practices, attorney fees and costs, declaratory relief, rescission of the
17
trustee's deed upon sale, and a permanent injunction enjoining defendants from their unlawful
18
activity.
19
SEVENTH CAUSE OF ACTION
20
(For Quiet Title against All Defendants)
21
116.
Plaintiff realleges and incorporates by reference all preceding paragraphs.
22
117.
Plaintiff is the owner of the Real Property.
23
118.
Plaintiff has superior title over all others, including Defendants, and on the basis
24
25
of Plaintiff's interest is that certain grant deed vesting title in him.
119.
Defendants' claim ownership of the Real Property by virtue of that certain
26
trustee's deed upon sale recorded as a result of the improper foreclosure. Because of
27
defendants' violations of the law as alleged herein, Plaintiff is entitled to an order rescinding,
28
19
VERFIED FIRST AMENDED COMPLAINT
1
2
setting aside, and/or canceling the trustee's deed upon sale.
120.
Plaintiff therefore seeks to quiet title in the Real Property and a declaration that
3
(a) title to the Real Property is vested in Plaintiff and that Defendants be declared to have no
4
estate, right, title or interest in the Real Property other than the original Deed of Trust in which
5
FFFCNCBI is the holder.
6
7
WHEREFORE PLAINTIFF PRAYS FOR JUDGMENT
8
AGAINST DEFENDANTS AS FOLLOWS:
9
1.
For any and all compensatory damages as may be proven at trial;
10
2.
For statutory damages;
11
3.
For punitive damages;
12
4.
For all costs and attorney fees as may be authorized by statute;
13
5.
For an order rescinding, canceling and/or setting aside the trustee's deed upon
14
sale purporting to supersede Plaintiff's title to the Real Property;
15
6.
For injunctive relief;
16
7.
For damages for several emotional distresses and mental damage in the sum of
17
$5,000,000.
18
8.
For costs of suit incurred herein; and
19
9.
For any other relief as the Court may deem just and proper.
20
21
22
REQUEST FOR TRIAL BY JURY
Plaintiff, JOHN Q. PUBLIC, requests that the trial in this case be by jury.
23
24
25
VERIFICATION
I am a party to this action, and I have read the foregoing Verified First
26
Amended Complaint and know its contents. The matters stated in the Verified
27
First Amended Complaint are true based on my own knowledge, except as to
28
20
VERFIED FIRST AMENDED COMPLAINT
1
those matters stated on information and belief, and as to those matters I believe
2
them to be true.
3
4
5
6
I declare under penalty of perjury under the laws of the State of California
that the foregoing is true and correct.
Executed on January __, 2010 at Los Angeles, California.
JOHN Q. PUBLIC
7
8
9
By:
JOHN Q. PUBLIC, Declarant
Plaintiff in Pro Per
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
21
VERFIED FIRST AMENDED COMPLAINT