416 F.3d 940, 946 (9th Cir. 2005). Under de novo
Barney, Inc.,
review, we look at the matter anew, as if it had not been heard
before, and as if no decision had been rendered previously,
giving no deference to the bankruptcy court's determinations.
457 F.3d l00l,
Freeman v. DirecTv, Inc., 1004 (9th Cir. 2006).
when reviewing a Civil Rule l2(b}(6) dismissal, we generally
limit our consideration to the complaint. Livid Holdings Ltd.,
416 F.3d at 946. we view the complaint in the light most
favorable to the plaintiff, accepting all well-pleaded factual
allegations as true, as well as any reasonable inferences drawn
from them. Johnson v. Riverside Healthcare Svs.,
534 F.3d 1116,
1122 (9th Cir. 2008).
we review for abuse of discretion the bankruptcy court's
decision to dismiss with prejudice. Stearns v. Ticketmaster
CO§Q.,
655 F.3d 1013, 1018 (9th Cir. 2011). But see Livid
8
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Holdings Ltd., 416 F.3d at 946 (“The district court's dismissal
of a complaint without leave to amend is reviewed de novo and is
improper unless it is clear that the complaint could not be saved
by any amendment.”)(citation omitted). we apply a two-part test
to determine objectively whether the bankruptcy court abused its
discretion. 1261-62
United States v. Hinkson,
585 F.3d 1247,
(9th Cir. 2G09)(en banc). First, we “determine de novo whether
the bankruptcy court identified the correct legal rule to apply
to the relief requested.” ;dg Second, we examine the bankruptcy
court's factual findings under the clearly erroneous standard.
;§g at 1262 & n.20. we must affirm the bankruptcy court's
factual findings unless those findings are “(1}
(2)
be drawn from the facts in the record.'"
‘illogical,’
‘implausible,' or (3) without ‘support in inferences that may
lsi
we may affirm on any ground supported by the record. Shanks
v. Dresse1,
540 F.3d 1082, 1086 (9th Cir. 2008).
DISCUSSION
A. Dismissal of the debtor’s adversary proceeding
1. Standards for Civil Rule 12(b)(6) Dismissal
Under Civil Rule l2(b)(6), applicable through Rule 70l2, a
court must dismiss a complaint if it fails to state a claim upon
which relief can be granted. The court may base its dismissal
either “on a lack of a cognizable legal theory or the absence of
sufficient facts alleged under a cognizable legal theory.”
Johnson, 534 Ft3d at 1121-22
(quoting Balistreri v. Pacifica
Police Dept.,
901 F.2d 596, 699 (9th Cir.
omitted)).
1990)(quotation marks
Although the court must accept a plaintiff's
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
25
26
27
28
allegations as true and construe them in a light most favorable
to him, it need not accept as true allegations that are merely
conclusory, or unreasonable inferences. In re Gilead sciences
Sec. Litig., 536 F.3d lO49, 1055 (9th Cir. 200B)(citing Sprewell
v. Golden State warriors,
266 F.3d 979, 958 (9th Cir. 2001)).
A plaintiff must provide more than “unadorned,
the-defendant-unlawfully-harmed-me accusation[s]” in his
complaint. Ashcroft v. Igbal,
556 U.S. 662, 67B (2009}(citing
Be11 At1antiC COLQ. v. TWOmb1¥,
550 U.S. 544, 555 (2007)). HE
cannot offer “labels and conclusions" or “a formulaic recitation
of the elements of a cause of action.” 1gbal, 556 U.S. at 678
{citing Twombly, 550 U.S. at 555). Nor can he simply offer
“naked assertions devoid of further factual enhancement." Igbal,
556 U.S. at 673 550 U.S. at 557)(quotation
(quoting L~s,.m,b.lr,
marks omitted)).
Therefore, to avoid dismissal under Civil Rule 12(b)(6), the
plaintiff must allege in his complaint “sufficient factual
matter, accepted as true, to state a claim for relief that is
plausible on its face.” Igbal, 556 U.S. at 67B (quoting Twombly,
550 U.S. at 570}(quotation marks omitted)). A claim is facially
plausible “when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” 556 U.S. at 67B. The
Igbal,
plausibility standard seeks more than “a sheer possibility that a
defendant has acted unlawfully.” Igbal, 556 U.S. at 678 (quoting
Twombly, 550 U.S. at 557)(quotation marks omitted)). “In sum,
for a complaint to survive a motion to dismiss, the
non-conclusory ‘factual content' and reasonable inferences from
10
10
ll
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
that content, must be plausibly suggestive of a claim entitling
the plaintiff to relief.” Moss v. U.s. secret Srvc., 572 F.3d
962, 989 {9th Cir. 2009)(Citing Igba1, 556 U.S. at 677-78).
Two principles run through a court's consideration of a
motion to dismiss. Igbal, 556 U.S. at 67B. First, the axiom
that a court must accept as true all of the complaint's
allegations does not apply to legal conclusions. lQ;
“Threadbare recitals of the elements of a cause of action,
supported by mere conclusory statements, do not suffice." ldg
Second, “only a complaint that states a plausible claim for
relief survives a motion to dismiss.” Id. at 679. Such a
determination is a “context-specific task” that requires the
court “to draw on its judicial experience and common sense.” Id.
But dismissal is appropriate where the “well-pleaded facts”
prevent the court from inferring “more than the mere possibility
of misconduct, the complaint has alleged - but it has not
‘shown'” ~ that the plaintiff is entitled to relief. ldg
In keeping with these principles, a court considering a
motion to dismiss therefore may choose to identify first
pleadings “that, because they are not more than conclusions, are
not entitled to the assumption of truth.” Id. Though legal
conclusions provide the framework of a complaint, they must be
supported by factual allegations. Id. when well~pleaded factual
allegations are present, a court “should assume their veracity
and then determine whether they plausibly give rise to an
entitlement to relief.” ldg
“[The} court may ppg look beyond the complaint to a
plaintiff‘s moving papers, such as a memorandum in opposition to
11
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
a defendant's motion to dismiss.” Schneider v. Cal. Dep‘t. of
Corr., 151 F.3d 1l94, 1197 n.1 (9th Cir. l998)(emphasis in
original). “The complaint cannot be amended by the briefs filed
by the plaintiff in opposition to the motion to dismiss.” Gomez
v. I1l. State Bd. Of Educ., 811 F.2d 1030, 1039 (7th Cir. 1987)
(citation omitted). Thus, the focus of any Civil Rule 12(b}(6)
dismissal - both in the trial court and on appeal - is the
complaint. Marder v. Lopez,
450 F.3d 445, 448 (9th Cir. 2006).
2. The debtor's claims for relief in the third amended
complaint
On appeal, the debtor argues that the bankruptcy court's
dismissal of his third amended complaint under Civil
Rule 12(b)(6) was neither “statutorily [nor] equitably fair.” He
does not explain how or why the dismissal was unfair. Rather, he
simply contends that, by dismissing the adversary proceeding
“[so] abruptly,” the bankruptcy court allowed JPMorgan to “steal”
the venice property from him. As JPMorgan notes, the debtor
provides no other argument and cites no legal authority in
support of his one contention on appeal.
The debtor did not provide a copy of the transcript of the
hearing on the third motion to dismiss (or any other hearing
transcripts, for that matter). The motions panel earlier entered
an order waiving the requirement that he submit an appendix,
including copies of transcripts of relevant hearings. Sti1l,
without a copy of the transcript of the hearing on the third
motion to dismiss, we have no access to the bankruptcy court's
reasoning, which hampers our review.
The debtor advances three claims in the third amended
12
r|>L-J[\JI-‘
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
complaint, all of which the bankruptcy court dismissed without
leave to amend. we look at each of the claims, as stated in the
third amended complaint, in turn.
411
The debtor contended in the third amended complaint that
JPMorgan defrauded him of the venice property by inducing him to
believe that it would accept from him a payoff of the debt owed
to it. As additional “factual allegations” in support of his
v
claim for relief, he described the source of a new loan. He also
offered, as a witness, the loan officer who was helping to
facilitate the new loan and who agreed to testify that the
“payoff to the [mortgagor] was already at hand."
Generally, a complaint need only plead facts sufficient to
give notice of the claim being asserted and the grounds on which
it rests. see Dominguez v. Miller §In re Dominguez§,
51 F.3d
1502, 1506 (9th Cir. l995)(explaining that within the context of
bankruptcy, courts construe deficient pleadings liberally, if the
pleading substantially complies with requirements of a complaint
under Civil Rule 9(b) by providing “fair notice of what the
plaintiff's claim is and the grounds upon which it rests.”). But
a claim for relief for fraud requires that the circumstances
constituting the fraud be pled with particularity to give the
defendant notice of the specific misconduct so that he can defend
Ciba-Geiqv Corp. USA, 317 F.3d
against the charge. See vess v.
1097, 1105-06 (9th Cir. 2003)(comparing Civil Rules 9(b) and
12(b)(6)). “Averments of fraud must be accompanied by the ‘who,
what, when, where, and how’ of the misconduct charged." Id.
(citation omitted).
13
[\.J
--..``:D\U'|)¥>L¢J
10
11
12
13
14
15
16
17
18
19
20
21
``22
23
24
25
26
27
28
Here, the debtor alleges that, though JPMorgan knew of the
new loan, it “secretly conspired with [the other defendants],
[sic] to undercut this transaction with this bogus and illegal
interference of this transaction to deny [him] his right [to
proceed with the new loan] and to steal his property.” The
debtor does not provide the “when, where and how” of this alleged
“illegal interference” carried out by JPMorgan. He simply makes
broad accusations with no specific facts to support them.
Because the debtor failed to provide the specific
circumstances giving rise to the alleged fraud, we determine that
the bankruptcy court did not err in dismissing the fraud claim
for relief.
b. wrongful foreclosure
The debtor also alleged that the foreclosure sale was
invalid because JPMorgan failed to comply with the notice
procedures set forth under Cal. Civ. Code § 2924. In California,
before a secured creditor may sell collateral after a debtor
defaults, it must satisfy certain statutory requirements.
Shahani v. United Commercial Bank,
457 B.R. 775, 788 (N.D. Cal.
2011). These statutory requirements include sending the debtor a
notice of default that alerts the debtor to the nature of the
default. Id. (citing Cal. Civ. Code § 2924). The statutory
requirements must be complied with strictly. Accordingly, a sale
based on a statutorily deficient notice of default is invalid and
voidable. Id. (quoting Miller v. Cote, 127 Cal. App. 3d 8B8, B94
(l982)). Here, according to the debtor, JPMorgan failed to serve
him properly with the default notice and the trustee's sale
notice.
14
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Yet, the debtor does not explain in the third amended
complaint hgg JPMorgan failed to serve him properly with the
default notice and the trustee's sale notice. It is only in the
third opposition and the accompanying declaration that the debtor
describes alleged defect(s) in the notice(s). The debtor claimed
that JPMorgan improperly served him with the default notice by
placing it on the ground near the front gate of the venice
property.
Yet, this specific allegation is not stated in the
third amended complaint. Because the debtor did not mention any
specific failures to satisfy the notice requirements of
California foreclosure procedures in any of the iterations of his
complaint, the bankruptcy court did not err in not mining
allegations from the third opposition to graft to the debtor's
151 F.3d at 1197 n-1.
wrongful foreclosure claim. See Schneider,
In addition, as discussed more fully infra, the debtor did
not allege tender of performance. “California courts have held
that a defaulted borrower is required to allege tender of the
amount of the lender‘s secured indebtedness in order to maintain
a cause of action for irregularity in the sale procedure."
Cedano v. Aurora Loan Srvcs., LLC §In re Cedano[,
529 (9th Cir. BAP 2012).
470 s.R. 522,
The debtor failed to assert a facially plausible claim
showing that he was entitled to relief under his wrongful
foreclosure claim. He did not allege facts sufficient to allow
the bankruptcy court to infer that JPMorgan was liable for
wrongful foreclosure or that he could comply with the tender
requirement. To quote Twombly, the debtor simply made “naked
assertion[s]” of wrongful foreclosure with no facts supporting
15
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
them. Accordingly, we conclude that the bankruptcy court
properly dismissed the debtor's wrongful foreclosure claim.
c. Set aside order
The debtor also sought to set aside the foreclosure sale on
was invalid as WAMU
the ground that it lacked the authority
and/or standing to transfer/assign its rights with respect to the
Venioe property to JPMorgan. JPMorgan contends on appeal that
the debtor's claim for set aside order necessarily fails because
he did not allege that he made tender - a factual allegation
necessary to maintain a claim for relief for irregularities in
foreclosure sale procedures.“
“A tender is an offer of performance made with the intent to
Saldate v.
extinguish the obligation.” wilshire Credit CorD.,
686 F. Supp. 2d 1051, 1059 (E.D. Cal. 2010)(quoting Arnolds Mgmt.
Corp. v. Eschen,
158 Cal. App. 3d 575, 580 (1984)(quotation marks
omitted)). The rules governing tenders are strictly applied.
Saldate, 686 F. Supp. 2d at 1060 (quoting Nguyen v. Calhoun,
105 Cal. App. 4th 428, 439 (2003)).
An action to set aside a foreclosure sale for irregularities
in the sale notice or procedure should be accompanied by an offer
to pay the full amount of the lender‘s secured indebtedness. Id.
at 1059-60 (quoting FPcI ies-sas 01 v. sec Inv., Ltd., 207 Cal.
3d 1018, 1021 (1989)). A valid and viable tender of payment
App.
of the owed indebtedness is essential to an action to set aside a
voidable sale under a trust deed. Saldate, 686 F. 2d at
Supp.
“ JPMorgan extends this argument to the debtor's wrongful
foreclosure claim, as we noted supra.
16
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1059 (quoting sec Inv. Ltci., 207 Cal. App. 3d at 1021). A
tender has no legal force or effect if the tenderer lacks the
funds necessary to make the offer good and knows it. Saldate,
606 F. supp. 2a at 1060
(quoting Karlsen v. Am. Sav. 0 Loan
Ass'n,
15 Cal. App. 3d 112, 118 (1971)). “The tenderer must do
and offer everything that is necessary on his part to complete
the transaction, and must fairly make known his purpose without
ambiguity, and the act of tender must be such that it needs only
acceptance by the one to whom it is made to complete the
transaction.” 2d at 160
Saldate, 686 F. Supp.
(quoting §affner
200 Cal. App. 3d 1154, 1165 {1988)).
v. Downey Sav. a Loan Ass‘n,
The debtor alleged in his third amended complaint that he
had obtained a new loan which he intended to use to pay off
JPMorgan.
He averred that he had the payoff amount “already at
hand.” (He even offered testimony of the loan officer who
handled the loan as a witness to substantiate this allegation.)
The debtor claimed that JPMorgan had agreed to accept a payoff
from him, but then used his reliance on this agreement to
“defraud” him of the venice property.
Although the debtor alleged that he had managed to secure a
new loan to pay off JPMorgan, he said nothing about whether he
actually could make good on the payoff. He merely said that he
could provide a witness who would testify that the payoff “was
already at hand.” Without a sufficient allegation of meaningful
tender, the debtor failed to state a viable claim for a set aside
order. The bankruptcy court therefore properly dismissed his
claim for a set aside order.
17
10
11
l2
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
B. Dismissal of the third amended complaint without leave to
afraid
The bankruptcy court's orders granting the debtor leave to
amend his complaint are basic. The bankruptcy court neither
provided the reasoning behind its determinations nor any
explanations as to the nature of the deficiencies in the debtor's
complaint. Still, the bankruptcy court gave the debtor three
opportunities to cure the deficiencies in his complaint, and they
were not cured through four versions of the complaint. It also
held several hearings on the motions to dismiss, which the debtor
apparently attended. In the absence of any hearing transcripts,
we cannot determine what instructions or guidance the bankruptcy
court provided to the debtor regarding curing the deficiencies in
his complaint.
Under these circumstances, we conclude that the bankruptcy
court did not err in dismissing the third amended complaint
without leave to amend.
C ONCLUS I ON
Having determined that the debtor failed to set forth
sufficient grounds for reversal of the dismissal of his adversary
proceeding, we AFFIRM.
18
