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Cotrell v. Central Mortgage Co.

United States District Court, D. Oregon

July 30, 2015

KATHERINE COTRELL, Plaintiff,
v.
CENTRAL MORTGAGE COMPANY, NORTHWEST TRUSTEE SERVICES, INC., Defendants.

Benjamin D. Knaupp, Garland Griffiths Knaupp, Hillsboro, OR, Attorney for plaintiff.

Lukasz I. Wozniak, Wright, Finlay & Zak, LLP, Newport Beach, CA, Attorney for defendant Central Mortgage Company.

John M. Thomas, RCO Legal, P.C., Portland, OR, Attorney for defendant Northwest Trustee Services, Inc.

OPINION AND ORDER

ANN AIKEN, Chief District Judge.

Defendants Central Mortgage Company (Central) and Northwest Trustee Services, Inc. (NWTS) move to dismiss plaintiff Katherine Cotrell's complaint pursuant to Fed.R.Civ.P. 12(b) (6).[1] Defendants also move for judicial notice of certain publicly-filed documents. For the reasons set forth below, defendants' motions are granted.

BACKGROUND

In November 2005, plaintiff took out a loan in the amount of $560, 000 to purchase a residential property in Portland, Oregon (Property). Pursuant to this transaction, plaintiff executed a Promissory Note (Note), which was secured by a Deed of Trust (DOT). The DOT identified plaintiff as the borrower, Barrington Capital Corporation (Barrington) as the lender, Mortgage Electronic Registration Systems, Inc. (MERS) as the beneficiary and nominee, and Fidelity National Title Company of Oregon as the trustee. Under the DOT, plaintiff agreed to make monthly mortgage payments as required under the Note. Plaintiff also agreed that she would be in default, and subject to foreclosure, if she failed to make such payments.

"Sometime during the fall of 2008, " plaintiff stopped making loan repayments as required by the Note and DOT. Compl. ΒΆ 5. On December 31, 2008, MERS assigned the DOT, as nominee for Barrington, to Central. Also on December 31, 2008, Central appointed NWTS as successor trustee under the DOT; NWTS, in turn, issued and recorded a Notice of Default. Plaintiff failed to cure her default and, on April 20, 2009, NWTS issued and recorded Trustee's Notice of Sale.

On May 6, 2009, Central purchased the Property at the foreclosure sale. A Trustee's Deed was recorded on May 11, 2009. Plaintiff vacated the Property in July 2009.

On April 24, 2015, plaintiff filed a complaint in Multnomah County Circuit Court, alleging claims for wrongful foreclosure under the Oregon Trust Deed Act (OTDA) and trespass. On May 15, 2015, Central removed plaintiff's case to this Court. On May 20, 2015, Central moved to dismiss plaintiff's complaint. On July 3, 2015, NWTS filed a separate motion to dismiss.

STANDARD OF REVIEW

Where the plaintiff fails to state a claim upon which relief can be granted, the court must dismiss the action. Fed.R.Civ.P. 12 (b) (6). To survive a motion to dismiss, the complaint must allege enough facts to state a claim for relief that is plausible on its face. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). For purposes of a motion to dismiss, the complaint is liberally construed in favor of the plaintiff and its allegations are taken as true. Rosen v. Walters, 719 F.2d 1422, 1424 (9th Cir. 1983). Bare assertions, however, that amount to nothing more than a formulaic recitation of the elements of a claim are conclusory and not entitled to be assumed true. Ashcroft v. Iqbal, 556 U.S. 662, 681 (2009). Rather, to state a plausible claim for relief, the complaint must contain sufficient allegations of underlying facts to support its legal conclusions. Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011), cert. denied, 132 S.Ct. 2101 (2012).

DISCUSSION

Defendants argue that plaintiff's complaint should be dismissed because she is statutorily barred from challenging the underlying non-judicial foreclosure, which was completed nearly six years before this lawsuit was commenced. In addition, defendants contend that MERS' status as beneficiary did not invalidate the foreclosure. According to defendants, plaintiff's trespass claim fails because the DOT expressly ...


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