Richard Bell v. Recontrust Company

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS FILED
FOR THE NINTH CIRCUIT OCT 23 2014
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
RICHARD BELL, et al., No. 12-16907
Plaintiffs - Appellants, D.C. No.
3:10-cv-00444-RCJ-WGC,
v.
RECONTRUST COMPANY, N.A., et al.,
MEMORANDUM*
Defendants - Appellees
Appeal from the United States District Court
for the District of Nevada
Robert C. Jones, District Judge, Presiding
Submitted October 9, 2014**
San Francisco, California
Before: W. FLETCHER and WATFORD, Circuit Judges, and DUFFY, District
Judge.***
Plaintiffs-Appellants Robert and Sally Kelley, Michael F. McKeon, Nigel
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable Kevin Thomas Duffy, District Judge for the U.S.
District Court for the Southern District of New York, sitting by designation.
Rudlin, and Shane Snyder (“Plaintiffs”) filed suit against Defendants-Appellees
ReconTrust Company, N.A., Bank of America, N.A., and Countrywide Home
Loans, Inc. (“Defendants”) regarding foreclosure proceedings against Plaintiffs’
properties. This action is the second such lawsuit brought by Plaintiffs in
connection with the properties and the procedural history of Plaintiffs’ original
lawsuits is somewhat convoluted. While certain of Plaintiffs’ claims in the original
suits were joined in a multi-district case (“MDL”) in the District of Arizona, some
of the claims at issue, to the extent that they involved conduct related to loan
origination and were not strictly MERS-related, remained in Nevada federal
district court. See In Re: Mortgage Electronic Registration Systems (MERS)
Litigation, No. 2:09-md-02119-JAT (D. Ariz, filed December 7, 2009). We
affirmed the judgment of the district court on the issues relevant to this appeal in In
Re: Mortgage Electronic Registration Systems (MERS) Litigation, 754 F.3d 772
(9th Cir. 2014), though we reversed the district court’s judgment and remanded the
case to the district court regarding a claim under Arizona law irrelevant to the
instant Plaintiffs’ claims.
I. Procedural History of Plaintiffs’ Claims
Each Plaintiff in this case, filed on July 16, 2010, was party to an earlier case
involving the same properties and defendants. On April 5, 2010, in Nevada federal
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district court, Plaintiffs Robert and Sally Kelly filed suit against Defendants in
Kelley et al. v. Genuine Title et al., No. 3:10–cv–00192–RCJ–VPC. The case was
consolidated-in-whole with In Re: Mortgage Electronic Registration Systems
(MERS) Litigation, and dismissed with prejudice on October 3, 2011, and we
affirmed the dismissal. Plaintiffs Robert and Sally Kelley failed to join the
consolidated amended complaint in the multi-district case, so their claims were
dismissed for that reason, in addition to the reasons that the district court found to
dismiss the consolidated amended complaint.
On November 6, 2009, in Nevada federal district court, Plaintiff Shane
Snyder filed suit against Defendants in Dalby v. Citimortgage, Inc., No.
3:09–cv–00659–RCJ–VPC. Dalby was consolidated-in-part with In Re: Mortgage
Electronic Registration Systems (MERS) Litigation. Though Plaintiff Shane
Snyder withdrew his original claims not consolidated in the MDL on July 2, 2010,
shortly before filing this subsequent lawsuit, he continued to litigate his MERS-
related claims in the MDL court. Those MDL claims were dismissed with
prejudice on October 3, 2011, and we affirmed the dismissal.
On September 14, 2009, in Nevada federal district court, Plaintiffs Michael
McKeon and Nigel Rudlin filed suit against Defendants in Dalton v. Citimortgage,
Inc., No. 3:09–cv–00534–LDG-VPC. Dalton was consolidated-in-part with In Re:
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Mortgage Electronic Registration Systems (MERS) Litigation. Though Plaintiffs
McKeon and Rudlin withdrew their original claims not consolidated in the MDL
on July 2, 2010, shortly before filing this subsequent lawsuit, they continued to
litigate MERS-related claims in the MDL court. Those MDL claims were
dismissed with prejudice on October 3, 2011, and we affirmed the dismissal.
Plaintiffs’ claims in the original lawsuits involved the same properties, defendants,
and causes of action at issue in this case, and were brought with the same counsel.
This appeal involves two issues: (i) the district court’s decision on March 30,
2011, to dismiss Plaintiffs’ suit as duplicative of previously filed actions,1 while
permitting Plaintiffs to amend the complaint to plead a promissory estoppel claim;
and (ii) the district court’s decision on August 3, 2012, granting Defendants’
1
Plaintiffs mischaracterize the issue on appeal as “whether [Plaintiffs] had
claims for breach of the covenant of good faith and fair dealing.” The district court
determined that most of the claims alleged by Plaintiffs in this suit were
duplicative of the causes of action in previously filed suits, and dismissed those
claims (including a claim for “Breach of the Covenant of Good Faith and Fair
Dealing in Contracts and/or Interference in Contractual Relations”) on that ground.
As for the “breach of the covenant of good faith and fair dealing,” the district court
determined at the March 7, 2011, hearing on Defendants’ motion to dismiss, that
the facts that Plaintiffs pled may have supported a promissory estoppel theory
based on Defendants’ conduct that occurred after the original suits were filed, and
allowed Plaintiffs to amend accordingly. Plaintiffs did amend to plead a
promissory estoppel claim. Properly put, the first issue on appeal is whether the
district court abused its discretion in determining that the claims dismissed,
including the claim for “breach of the covenant of good faith and fair dealing,”
were duplicative of a previous suit.
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motion to dismiss a promissory estoppel claim under Nevada law.2 This Court has
jurisdiction under 28 U.S.C. § 1291, and we affirm the district court’s judgment.
II. The District Court’s Decision to Dismiss the Suit
We review the district court’s decision to dismiss a duplicative claim for an
abuse of discretion. M.M. v. Lafayette Sch. Dist., 681 F.3d 1082, 1086 (9th Cir.
2012). The “abuse of discretion” test requires us to consider (i) whether the district
court identified the correct legal standard for decision on the issue before it and, to
determine (ii) “whether the district court’s findings of fact, and its application of
those findings of fact to the correct legal standard, were illogical, implausible, or
without support in inferences that may be drawn from facts in the record.” U.S. v.
Hinkson, 585 F.3d 1247, 1251 (9th Cir. 2009) (en banc).
“[I]n assessing whether the second action is duplicative of the first, we
examine whether the causes of action and relief sought, as well as the parties or
2
Plaintiffs’ also identified the district court’s July 21, 2011, order in the
notice of appeal. In that order, the district court rejected Plaintiffs’ first attempt to
plead the promissory estoppel claim in lieu of the “breach of the covenant of good
faith and fair dealing” claim. Because Plaintiffs’ opening brief does not argue that
the district court’s decision was issued in error or in an abuse of discretion, we
conclude that any appeal of the July 21, 2011, order is waived. See Fed. R. App. P.
28(a)(8); Christian Legal Soc’y Chapter of Univ. of Cal. v. Wu, 626 F.3d 483, 487
(9th Cir. 2010). In any event, the district court did not abuse its discretion in
dismissing the third amended complaint because Plaintiffs continued to plead
claims that dealt with the original loans and were therefore duplicative of earlier
litigation.
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privies to the action, are the same.” Adams v. Cal. Dep’t of Health Servs., 487 F.3d
684, 689 (9th Cir. 2007). The district court found that Plaintiffs had separately
filed actions in 2009 and 2010 naming the Defendants that concerned the same
foreclosed properties at issue in this case and dismissed the claims in this case that
were duplicative of the claims litigated in the previously filed cases. Plaintiffs do
not make any argument or cite any case law to explain how, if at all, the district
court abused its discretion in determining that their claims were duplicative of
claims in previously filed actions. That failure is grounds enough to affirm the
district court’s judgment. See Weston v. Lockheed Missiles & Space Co., 881 F.2d
814, 816 (9th Cir. 1989). There is nothing in the record that demonstrates that the
district court abused its discretion. We conclude that the district court did not
abuse its discretion when it dismissed the claims as duplicative of previously filed
actions.
III. The District Court’s Decision to Dismiss the Promissory Estoppel Claim
When the district court dismissed Plaintiffs’ claims as duplicative of a
previously filed lawsuit, it provided Plaintiffs the opportunity to amend their
complaint to include a claim for promissory estoppel for conduct that occurred
after the original suits were filed. Plaintiffs so amended the complaint and the
district court granted Defendants’ motion to dismiss the amended complaint for
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failure to state a claim. We review de novo the district court’s decision to grant a
motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure
12(b)(6). Lacey v. Maricopa Cnty., 693 F.3d 896, 911 (9th Cir. 2012)
(en banc). A complaint need not state “detailed factual allegations,” but it must
contain sufficient factual matter to “state a claim to relief that is plausible on its
face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007). “A claim has
facial plausibility when the plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable for the misconduct
alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). We review de novo the
district court’s interpretation of state law. Coughlin v. Tailhook Ass’n, 112 F.3d
1052, 1055 (9th Cir. 1997).
“Broadly speaking, Nevada follows the doctrine of promissory estoppel
articulated in the Restatement (Second) of Contracts.” Dynalectric Co. of Nev. v.
Clark & Sullivan Constructors, Inc., 255 P.3d 286, 288 (Nev. 2011). Under
Nevada law, the elements of promissory estoppel are:
(1) the party to be estopped must be apprised of the true facts; (2) he
must intend that his conduct shall be acted upon, or must so act that the
party asserting estoppel has the right to believe it was so intended; (3)
the party asserting the estoppel must be ignorant of the true state of facts;
(4) he must have relied to his detriment on the conduct of the party to be
estopped.
Pink v. Busch, 691 P.2d 456, 459 (Nev. 1984) (quoting Cheqer, Inc. v. Painters &
7
Decorators Joint Comm., Inc., 655 P.2d 996, 998–99 (Nev. 1982)).
In Nevada, a plaintiff must establish that the defendant made a definitive
promise to the plaintiff in order to establish a primary element of promissory
estoppel. See Vancheri v. GNLV Corp., 777 P.2d 366, 369 (Nev. 1989) (“The
doctrine of promissory estoppel, which embraces the concept of detrimental
reliance, is intended as a substitute for consideration, not as a substitute for an
agreement between the parties. Accordingly, the first prerequisite of the agreement
is a promise.” (citations omitted)). The amended complaint does not allege any
definitive promise to any of the Plaintiffs from any Defendants. Plaintiffs allege
that Defendant Bank of America, N.A.’s representatives–whom they do not
identify–told Plaintiffs that they could not be considered for a mortgage
modification unless Plaintiffs were late on their mortgage payments. Plaintiffs do
not allege that Bank of America promised to modify their mortgages or delay
foreclosure. Informing Plaintiffs of Bank of America’s policies regarding
mortgage modifications does not amount to a definitive promise to modify the loan
or a definitive promise not to foreclose on Plaintiffs’ properties. See Restatement
(Second) of Contracts § 2 cmt. e (1981).
Moreover, the complaint failed to set forth any facts with regard to
ReconTrust Company, N.A. and Countrywide Home Loans, Inc. Plaintiffs make
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no specific allegations against these defendants. ReconTrust Company, N.A. and
Countrywide Home Loans, Inc. are merely named as defendants. As a result, any
claims for promissory estoppel against ReconTrust Company, N.A. and
Countrywide Home Loans, Inc. must fail. See Iqbal, 556 U.S. at 678.
For these reasons we affirm the district court’s decision dismissing the
fourth amended complaint for failure to state a claim.
The judgment of the district court is AFFIRMED.
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