Nordeen v. Bank of America, N.A. (In Re Nordeen)
495 B.R. 468
9th Cir. BAP2013Background
- Nordeens signed a $140,000 note in 2005 secured by a Nevada/Arizona real property deed of trust with ReconTrust as trustee and MERS as nominee for Countrywide.
- Note transfer and securitization occurred to CWALT in 2005; servicing changes were anticipated with notices to borrowers.
- Nordeens defaulted in 2008; bankruptcy filed June 2009; BAC filed a secured claim August 2009.
- Nordeens filed an adversary proceeding in 2011 asserting securitization-based theories and other claims under RESPA, TILA, FDCPA, and related theories.
- Bankruptcy court dismissed the Second Amended Complaint with prejudice after briefing and hearings; Nordeens appealed to the Ninth Circuit.
- Court affirmed dismissal, holding securitization theory nonviable and claims inadequately pleaded under applicable standards.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Pleadings Judgment Motion was evaluated under correct standards | Nordeen argues improper legal standard was used | Appellees contend standard was correctly applied | No error; correct standard applied |
| Timing of consideration of the Pleadings Judgment Motion | Argues trial-ready stage; dismissal premature | Rule 12(c) permits post-answer judgment on pleadings when raised | Proper timing; dismissal not an undue delay |
| Whether Securitization Theory was viably pleadable | Theory destroys enforceability of Note/Trust Deed | Theory rejected by courts; note/loan contract remains enforceable | Securitization theory not viable; claims dismissed |
| Whether declaratory relief based on alleged Note fabrication is viable | Note fabrication allegations support declaratory relief | Allegations insufficient to state a cognizable claim | Declaratory relief claim lacking substance and properly dismissed |
| Whether fraud claims were properly dismissed | Raised multiple fraud theories against appellees | Fraud elements not pled with particularity or causation under Nevada/federal standards | Fraud claims properly dismissed |
Key Cases Cited
- Balistreri v. Pacifica Police Dept., 901 F.2d 696 (9th Cir. 1990) (liberal pleading standards for pro se plaintiffs; notice must be provided)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (facial plausibility required; mere conclusory statements insufficient)
- Estelle v. Gamble, 429 U.S. 97 (U.S. 1976) (liberal pleading standards for pro se plaintiffs; excessive formality rejected)
- Papasan v. Allain, 478 U.S. 265 (U.S. 1986) (court may consider non-conclusory factual allegations as true)
- McGlinchy v. Shell Chemical Co., 845 F.2d 802 (9th Cir. 1988) (application of Rule 12(b)(6) standards to motions for judgment on the pleadings)
- Hernandez v. Hogan (Hogan v. Washington Mut. Bank), 277 P.3d 781 (Ariz. 2012) (Arizona foreclosures not governed by UCC before trustees’ actions)
- Schlegel v. Wells Fargo Bank, NA, F.3d (2013) (FDCPA claims not applicable to foreclosure entities; proper dismissal consistent with circuit)
- Yamamoto v. Bank of N.Y., 329 F.3d 1167 (9th Cir. 2003) (rescission under TILA; limitations and repayment conditions)