McBride v. PHH Mortgage Corp. ( 2024 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 ROBERT MCBRIDE, an individual, No. 2:23-cv-02242 WBS DB 13 Plaintiff, 14 v. TEMPORARY RESTRAINING ORDER 15 PHH MORTGAGE CORPORATION, a limited liability company, and 16 DOES 1 through 20, inclusive, 17 Defendant. 18 19 ----oo0oo---- 20 Plaintiff Robert McBride moves for a temporary 21 restraining order to enjoin a trustee’s sale of his home, 22 currently scheduled for Tuesday, February 13, 2024. (Docket No. 23 14). The court heard oral arguments on the motion on February 24 12, 2024. Brooke Brewer, Esq., appeared on behalf of plaintiff; 25 and Neil Cooper, Esq., appeared on behalf of defendant. 26 “The purpose of a temporary restraining order is to 27 preserve the status quo pending the complete briefing and 28 thorough consideration contemplated by full proceedings pursuant 1 to a preliminary injunction.” Occupy Sacramento v. City of 2 Sacramento, No. 2:11-CV-02873-MCE, 2011 WL 5374748, at *3 (E.D. 3 Cal. Nov. 4, 2011) (citing Granny Goose Foods, Inc. v. Teamsters, 4 415 U.S. 423, 438–39 (1974) (temporary restraining orders “should 5 be restricted to serving their underlying purpose of preserving 6 the status quo and preventing irreparable harm just so long as is 7 necessary to hold a hearing, and no longer”); Reno Air Racing 8 Ass’n. v. McCord, 452 F.3d 1126, 1131 (9th Cir. 2006); Dunn v. 9 Cate, No. CIV 08-873-NVW, 2010 WL 1558562, at *1 (E.D. Cal. Apr. 10 19, 2010). 11 In order to obtain a temporary restraining order or 12 preliminary injunction, the moving party must establish (1) it is 13 likely to succeed on the merits, (2) it is likely to suffer 14 irreparable harm in the absence of preliminary relief, (3) the 15 balance of equities tips in its favor, and (4) an injunction is 16 in the public interest. Winter v. Nat. Res. Def. Council, Inc., 17 555 U.S. 7, 20-21 (2008); Humane Society of the U.S. v. 18 Gutierrez, 558 F.3d 896, 896 (9th Cir. 2009); Credit Bureau 19 Connection, Inc. v. Pardini, 726 F. Supp. 2d 1107, 1132 (E.D. 20 Cal. 2010) (standards for temporary restraining orders and 21 preliminary injunctions are the same). 22 I. Likelihood of Success on the Merits 23 Here, plaintiff alleges violations of the Homeowner 24 Bill of Rights (“HBOR”), California Civil Code §§ 2923.6 and 25 2923.7, and the Unfair Competition Law (“UCL”). 26 Section 2923.6 prohibits “dual tracking,” in which a 27 lender proceeds with the foreclosure process while reviewing a 28 loan modification application. See Cal. Civ. Code § 2923.6(c). 1 “If a borrower submits a complete application for a first lien 2 loan modification offered by, or through, the borrower's mortgage 3 servicer, a mortgage servicer . . . shall not record a notice of 4 default, or conduct a trustee's sale, while the complete first 5 lien loan modification application is pending.” Id. Section 6 2923.6(d) further provides that the “borrower shall have at least 7 30 days from the date of the written denial to appeal the denial 8 and to provide evidence that the mortgage servicer's 9 determination was in error.” Id. § 2923.6(d). 10 Section 2923.6(c)-(d) thus “prohibits recording a 11 notice of default or sale and conducting that sale” while a loan 12 modification application is pending. Marquez v. U.S. Bank, N.A., 13 Case No. CV16-06658 JAK (Ex), 2016 WL 2885857, at *7 (N.D. Cal. 14 May 16, 2016); see Shupe v. Nationstar Mortg. LLC, Civ. 231 15 F.Supp.3d 597, 602, (E.D. Cal. Jan. 31, 2017) (England, J.) 16 (“California Civil Code § 2923.6 places restrictions on the 17 recording of Notices of Default or Notices of Trustee's Sale 18 while a loan modification application is pending.”) 19 The parties dispute whether plaintiff’s several past 20 applications for a loan modification checked all the boxes as to 21 be actually “complete.” However, neither party disputes that 22 plaintiff submitted a completed application on October 13, 2023. 23 (Schwiner Decl. (Docket No. 18) ¶ 31.) On December 6, 2023, 24 defendant alleges that it approved this application and sent 25 plaintiff a Trial Period Plan (“TPP”) offer letter. (Id. Ex. 26 32.) However, this offer appears to be contingent on plaintiff 27 accepting a settlement offer and permanently releasing their 28 1 claims in this lawsuit.1 Because of the conditional nature of 2 the TPP offer and the fact that the TPP offer letter itself does 3 not reference plaintiff’s October 13, 2023 application, the court 4 cannot conclude that the offer defendant extended on December 6, 5 2023 is a final, written decision based strictly on the merits of 6 plaintiff’s October 13, 2023 application. 7 Accordingly, the court concludes that plaintiff shows a 8 likelihood of success at least as to his Section 2923.6 claim. 9 This is sufficient to satisfy the first Winter prong. 10 II. Irreparable Harm 11 The foreclosure of plaintiff’s home conclusively 12 constitutes irreparable harm. See Park Village Apt. Tenants 13 Ass’n v. Mortimer Howard Trust, 636 F.3d 1150, 1159 (9th Cir. 14 2011) (“loss of an interest in real property constitutes an 15 irreparable injury”); Sundance Land Corp. v. Community First 16 Fed’l Sav. & Loan Ass’n, 840 F.2d 653, 661 (9th Cir. 1988). 17 Plaintiff therefore satisfies the second Winter factor. 18 III. Balance of Equities 19 The balance of equities also favors plaintiffs. While 20 plaintiff will lose his home if the court were to deny the 21 request, if the court is to grant the request defendants will 22 need to postpone the foreclosure, which they have already done at 23 24 1 Defendant only included the TPP offer in their moving papers, which they described as “the relevant pages of the TPP.” 25 (Schwiner Decl. ¶ 31.) However, at oral argument, defendant’s counsel provided the court with a copy of a proposed settlement 26 agreement that includes the TPP offer as an exhibit. It 27 therefore appears that plaintiff was never presented with a standalone TPP offer that did not also require them to settle 28 nee nnn nnn en nn nnn nn nnn OI I ED EE 1 least once in the past. There is injury and inconvenience on 2 both sides, but the balance of it lies with plaintiff, and 3 therefore cuts in favor of a temporary injunction. See Andrews 4 v. City of San Bernardino, 346 P.2d 457, 463 (Cal. App. 4th Dist. 5 1959) (trial court’s discretion to grant or deny a preliminary 6 injunction should be exercised in favor of the party most likely 7 to be injured). 8 IV. Public Interest 9 The public has a strong interest in foreclosure sales 10 being conducted according to the letter and the spirit of the 11 law. The public also has an interest in meritorious claims being 12 fully tested by argument and evidence. Accordingly, the court 13 concludes that the public interest also militates towards 14 granting plaintiff’s request. 15 IT IS THEREFORE ORDERED that plaintiff’s ex parte 16 application for a temporary restraining order (Docket No. 14) be, 17 and the same hereby is, GRANTED. Defendant is hereby temporarily 18 enjoined from conducting a trustee’s sale on the property located 19 at 3650 Coyote Road, West Sacramento California, pending further 20 Order of this court. 21 Dated: February 12, 2024 he theo tH, fh bee— WILLIAM B. SHUBB 23 UNITED STATES DISTRICT JUDGE 24 25 26 27 28