Castro v. Pascual ( 2020 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 SAN JOSE DIVISION 7 8 JOHN R. CASTRO, Case No. 20-cv-01090-BLF 9 Plaintiff, ORDER GRANTING PLAINTIFF’S 10 v. APPLICATION TO PROCEED IN FORMA PAUPERIS; SCREENING 11 JOHN PASCUAL; CONIE LEGASPI; COMPLAINT PURSUANT TO 28 U.S.C. RONALD ALONZO; LAW OFFICE OF § 1915(E); AND DISMISSING 12 MCCARTHY & HOLTHUS; QUALITY COMPLAINT WITH LEAVE TO LOAN SERVICE CORP.; AND AMEND 13 JPMORGAN CHASE BANK, N.A., [Re: ECF 2] 14 Defendants. 15 16 Plaintiff John R. Castro (“Castro”) filed this action on February 11, 2020, challenging the 17 alleged “non-judicial wrongful foreclosure” of property located at 630 E. Market Street, Salinas, 18 California 93905 (“the Property”). See Compl., ECF 1. On the same date, Castro filed an 19 application to proceed in forma pauperis (“IFP Application”). See IFP Applic., ECF 2. The IFP 20 Application is GRANTED. 21 A federal court must conduct a preliminary screening of any complaint filed by an 22 individual proceeding in forma pauperis. 28 U.S.C. § 1915(e)(2)(B). The screening requirement 23 applies to both prisoners and non-prisoners. Calhoun v. Stahl, 254 F.3d 845, 845 (9th Cir. 2001) 24 (“[T]he provisions of 28 U.S.C. § 1915(e)(2)(B) are not limited to prisoners.”). The court’s 25 screening obligation extends beyond the original complaint, as the court “shall dismiss the case at 26 any time” if it determines that the plaintiff’s pleading is frivolous or malicious, fails to state a 27 claim upon which relief may be granted, or seeks monetary relief from a defendant who is immune 1 The complaint is subject to dismissal because it fails to state a claim upon which relief may 2 be granted. Castro alleges that in October 2006, he obtained a home equity loan in the amount of 3 $150,000 from Washington Mutual Bank. Compl. ¶ 13.1. Although Castro apparently received 4 the loan funds, he asserts that “the original debt was actually zero because the plaintiff’s financial 5 asset was exchanged for FED’s promissory notes in an even exchange.” Compl. ¶ 13.2 Castro 6 alleges that he made timely monthly interest-only payments in the amount of approximately 7 $890.34 from November 2006 through June 2014, initially to WAMU Bank and then to Chase 8 Bank. Compl. ¶¶ 15.1, 15.2. In 2014, Chase Bank stated that Castro was behind on payments, 9 and assigned Quality Loan Service Corp. (“Quality”) to commence foreclosure on the Property. 10 Compl. ¶ 15.3. 11 Quality recorded a Notice of Default and Election to Sell Under Deed of Trust in July 12 2015. Compl. ¶ 15.4 & Exh. A. The Notice of Default, which is attached to the complaint as 13 Exhibit A, indicated that Quality was proceeding under a Deed of Trust dated 10/28/2006 which 14 was executed by John Raymond Castro and Rosary V. Castro to secure a Note in the original sum 15 of $150,000. Notice of Default, Compl. Exh. A. The Notice of Default stated that no payments 16 had been made from June 2014 onward and that the amount of default was $17,777.71 as of July 17 7, 2015. Id. 18 It appears that the foreclosure proceedings were completed, and that Castro is seeking to 19 set the foreclosure sale aside as void. Compl. at 2. He also may be challenging state court 20 eviction proceedings. Id. Castro claims that “[t]he defendant who initiated the non-judicial 21 foreclosure did not have standing to execute the power of sale clause in the deed of trust.” Compl. 22 ¶ 1.1. Castro states that “[t]he lack of authority to execute the power of sale clause and the other 23 claims mentioned herein is the basis for this wrongful foreclosure lawsuit.” Id. 24 The complaint is rambling, and it is difficult to understand Castro’s asserted reasons for 25 challenging Quality’s standing to commence foreclosure proceedings. He asserts that “[t]he law 26 firm, or the attorney, did not meet the requirements mandated in the Fair Debt Collection Practices 27 Act (FDCP A), necessary to be a legal debt collector.” Compl. ¶ 2.1. He also alleges that 1 represent a fictitious corporation in court.” Compl. ¶ 3.2. It is unclear what role McCarthy & 2 Holthus played in the events giving rise to this lawsuit. 3 The complaint makes reference to several individuals and entities whose roles in this case 4 are unclear, and it contains numerous conclusory allegations of wrongdoing, for example: “The 5 contract should be rescinded because the defendant did not provide full disclosure, the contract is 6 extremely deceptive and unconscionable as well as numerous statements,” Compl. ¶ 14.1; “The 7 promissory note is not listed on a maritime lien against the prepaid trust account and filed with the 8 county recorder and put on a UCC-1, Compl. ¶ 14.9; “The plaintiff provides evidence in the notice 9 of default document and the Deed of trust that will prove the power of sale was executed by an 10 agent without standing, and this prejudiced the plaintiff and therefore requests damages both 11 compensatory and punitive as relief for the prejudice suffered,” Compl. ¶ 16.3. 12 The complaint also contains several nonsensical statements of law, such as: “[C]ontracts 13 requiring lawful money are illegal pursuant to Title 31 USC § 5118( d)(2),” Compl. ¶ 13.4; “All 14 debts today are discharged by promises to pay in the future,” id.; “Corporations cannot sign and 15 therefore cannot enter into any contract, with an attorney,” Compl. ¶ 17.3; “Lawyers and attorneys 16 are NOT licensed to practice law, the nature of lawyer-craft in America as per the United States 17 Supreme Court; The practice of Law CAN NOT be licensed by any state/State,” Compl. ¶ 19.6; 18 “The practice of Law is AN OCCUPATION OF COMMON RIGHT!,” Compl. ¶ 19.7. 19 The complaint contains claims for: (1) Wrongful Foreclosure; (2) Violation of the Fair 20 Debt Collection Practices Act (“FDCPA”); (3) Violation of the Truth in Lending Act; (4) Breach 21 of Contract; (5) Violation of Federal Trust and Lien Laws; (6) Slander of Title; (7) Slander of 22 Credit; and (8) Infliction of Emotional Distress. These claims consist of a single sentence each, 23 and are wholly unsupported by the preceding factual allegations. 24 Even measured by the liberal standards accorded pro se litigants, Castro’s complaint is 25 incomprehensible and fails to state a claim upon which relief could be granted. While a complaint 26 need not contain detailed factual allegations, it “must contain sufficient factual matter, accepted as 27 true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 1 While the Court has grave reservations whether Castro will be able to cure the deficiencies 2 || in his complaint to state a viable claim for relief, the Court will grant him an opportunity to try. 3 Accordingly, the complaint is DISMISSED WITH LEAVE TO AMEND. 4 ORDER 5 (1) Plaintiff's application to proceed in forma pauperis is GRANTED; 6 (2) Any amended complaint shall be filed on or before March 6, 2020; 7 (3) Castro is advised that failure to allege facts sufficient to state a claim may result in 8 dismissal of the case with prejudice; and 9 (4) Castro is advised that the U.S. Marshal will not be directed to serve process on 10 Defendants unless and until Castro files a viable complaint. 11 12 Dated: February 13, 2020 kom hair! BETH LABSON FREEMAN 14 United States District Judge 16 18 19 20 21 22 23 24 25 26 27 28