Galope v. Deutsche Bank National Trust Co.

FILED
NOT FOR PUBLICATION
DEC 14 2016
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
HELEN GALOPE, an individual, No. 15-55246
Plaintiff-Appellant, D.C. No.
8:12-cv-00323-CJC-RNB
v.
DEUTSCHE BANK NATIONAL TRUST MEMORANDUM*
COMPANY, as Trustee under Pooling and
Servicing Agreement dated as of May 1,
2007 Securitized Asset Backed
Receivables LLC Trust 2007-BR4;
WESTERN PROGRESSIVE, LLC;
BARCLAYS BANK PLC; BARCLAYS
CAPITAL REAL ESTATE, INC., DBA
Homeq Servicing; OCWEN LOAN
SERVICING, LLC; DEUTSCHE BANK
AG,
Defendants-Appellees.
Appeal from the United States District Court
for the Central District of California
Cormac J. Carney, District Judge, Presiding
Argued and Submitted November 7, 2016
Pasadena, California
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Before: WARDLAW and BYBEE, Circuit Judges, and BELL,** District Judge.
Helen Galope appeals the district court’s partial dismissal and partial
summary judgment of her action under the Sherman Antitrust Act and California
state law against Appellees Deutsche Bank National Trust Co. (“DBNTC”),
Western Progressive and Ocwen Loan Servicing (collectively the “DBNTC
Defendants”); Barclays Bank (“Barclays”), Barclays Capital Real Estate Inc.
(“BCREI”) (collectively the “Barclays Defendants”), and Deutsche Bank AG
(“Deutsche Bank”).
1. The district court did not err in holding that the DBNTC Defendants’
alleged violation of California Business and Professions Code § 17200 et seq
(“UCL”) and alleged breach of the implied covenant of good faith and fair dealing
were preempted under the Bankruptcy Code. These state-law claims are based on
alleged violations of the automatic stay, and are therefore preempted. See MSR
Exploration Ltd. v. Meridian Oil, Inc., 74 F.3d 910, 913–14 (9th Cir. 1996). As to
Galope’s federal claim under 11 U.S.C. § 362(k), the district court properly
dismissed it because it could only have been brought before the bankruptcy court.
See C.D. Cal. G.O. 13-05 (July 1, 2013); 28 U.S.C. § 157(a).
**
The Honorable Robert Holmes Bell, United States District Judge for
the Western District of Michigan, sitting by designation.
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2. The district court did not err in granting summary judgment on Galope’s
antitrust claims against the Barclays Defendants, because Galope lacked antitrust
standing. Galope alleges that Barclays’ manipulation of the LIBOR rate injured
her by causing her to purchase a loan product that she otherwise would not have.
However, she failed to establish that she made any payments on her loan that were
linked to LIBOR. Any injury that she may have suffered was therefore too indirect
and speculative to confer antitrust standing. See Amarel v. Connell, 102 F.3d 1494,
1507 (9th Cir. 1996).
3. Nor did the district court err in granting summary judgment on Galope’s
state-law claims against the Barclays Defendants. Claims under California’s UCL
and False Advertising Law (“FAL”), Cal. Bus. & Prof. Code § 17500 et seq.,
cannot be predicated on vicarious liability. Perfect 10, Inc. v. Visa Int’l Serv.
Ass’n, 494 F.3d 788, 808 (9th Cir. 2007). Rather, “[a] defendant’s liability must be
based on his personal participation in the unlawful practices and unbridled control
over the practices that are found to violate [these statutes].” Id. (quoting Emery v.
Visa Int’l Serv. Ass’n 95 Cal. App. 4th 952, 960 (2002)).
Galope purchased her loan from New Century, and dealt exclusively with
New Century during the loan-origination process. Barclays had no involvement
until at least four months later, when the loan was sold into the trust, and BCREI
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became the designated servicer. Because liability can be based on only personal
participation in unlawful activity, the Barclays Defendants were entitled to
summary judgment on these claims.
4. Similarly, Galope cannot attribute any deceptive statements to the
Barclays Defendants during the loan origination process to maintain a cause of
action for fraud. See Minn. Mut. Life Ins. Co. v. Ensley, 174 F.3d 977, 982 (9th
Cir. 1999). Thus, summary judgment was also appropriate for this claim.
5. The district court did not err in ruling in favor of the Barclays Defendants
on Galope’s claim for breach of California’s implied covenant of good faith and
fair dealing. The parties must have a contractual relationship as a prerequisite for
this claim. Jenkins v. JP Morgan Chase Bank, N.A. 216 Cal. App. 4th 497, 525
(2013). Galope argues that she was obligated to make monthly mortgage payments
to a subsidiary of Barclays, which established a contractual relationship between
Galope and Barclays. But there is no contractual relationship between a mortgagor
and a loan servicer. See, e.g., Reed v. US Bank N.A., No. 14-cv-05437-VC, 2015
WL 5042244, at *3 (N.D. Cal. Aug. 25, 2015) (“[A]s the loan servicer, [defendant]
was never a party to the deed of trust.”); Howard v. First Horizon Home Loan
Corp., No. 12-cv-05735-JST, 2013 WL 3146792, at *3 (N.D. Cal. June 18, 2013)
(dismissing plaintiff’s implied covenant claim because a contractual “relationship
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does not exist[] on the basis that [defendant] acted as a loan servicer or as an agent
for [lender] in connection with the deed of trust”). Therefore, there was no
contractual relationship between the two parties, and summary judgment was
appropriate.
6. Lastly, the district court did not err in finding that it lacked personal
jurisdiction as to Deutsche Bank. Galope argues that, because she raised antitrust
claims in her complaint, the district court should have applied a nationwide-
contacts analysis under 15 U.S.C. § 22. See Go-Video Inc. v. Akai Elec. Co., Ltd.,
885 F.2d 1406, 1415 (9th Cir. 1988). But Galope lacks standing to bring her
antitrust claims against Deutsche Bank for the same reason she lacks standing
against Barclays: any injury she suffered was too indirect and speculative to confer
antitrust standing. See Amarel, 102 F.3d at 1507. Therefore, the nationwide-
contacts test under § 22 does not apply. Moreover, the district court did not abuse
its discretion in denying leave to amend the complaint, because it was “clear that
the complaint could not be saved by any amendment.” See Harris v. Amgen, 573
F.3d 728, 737 (9th Cir. 2009).
AFFIRMED.
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