United States District Court, D. Oregon, Medford Division
OPINION & ORDER
MICHAEL McSHANE United States District Judge.
matter comes before the Court on a Motion to Dismiss filed by
Defendants imortgage.com, Inc. and LoanDepot. ECF No. 7. The
Motion to Dismiss is GRANTED and the Complaint is DISMISSED
with leave to amend. Plaintiff shall have thirty (30) days
from the date of this Order in which to file an amended
April 2011, Defendant imortgage.com, Inc., entered into a
lease agreement with the Charles and Dudee Rembert Trust (the
“Trust”) for the rental of a commercial office
building in Medford, Oregon. At some point, Defendant
LoanDepot became the successor in interest, assignee, and
tenant along with imortgage.com. At some further point,
Plaintiff North Phoenix Road, LLC, “acquired the
landlord's interest and thus attorned to the
landlord's interest under the lease.”
current term of the lease runs through March 2020. Plaintiff
alleges that Defendants have repudiated their obligations
under the lease and ceased to pay rent in January 2019.
Defendants vacated the leased premises in February 2019,
although Plaintiff alleges that Defendants did not leave the
premises in the condition required by the lease.
March 2019, Plaintiff brought this action in Jackson County
Circuit Court seeking the value of the rent, plus late fees,
and the cost of returning the property to the condition
required by the lease, offset by the security deposit held by
Plaintiff. In May 2019, Defendants removed this case to
federal court and thereafter filed the present motion to
courts are courts of limited jurisdiction, and generally have
jurisdiction as authorized by the Constitution or statute.
Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S.
375, 377 (1994). Courts presume that a case “lies
outside this limited jurisdiction, and the burden of
establishing the contrary rests upon the party asserting
jurisdiction.” Id. (internal citation
omitted). Federal Rule of Civil Procedure 12(b)(1) allows for
a defendant to challenge subject matter jurisdiction.
motion to dismiss for lack of subject matter jurisdiction
under Rule 12(b)(1) may be either “facial” or
“factual.” Safe Air for Everyone v.
Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). In a facial
attack on subject matter jurisdiction, as alleged by
Defendants in the present case, the court resolves the motion
as it would a motion to dismiss under Rule 12(b)(6).
Leite v. Crane Co., 749 F.3d 1117, 1121 (9th Cir.
2014); Savage v. Glendale Union High Sch., 343 F.3d
1036, 1039 n.1 (9th Cir. 2003). In a facial challenge, the
Court accepts the factual allegations of the complaint as
true and draws all reasonable inferences in the
plaintiff's favor, and “the court determines
whether the allegations are sufficient as a legal matter to
invoke the court's jurisdiction.” Leite,
749 F.3d at 1121. In pleading his or her claims, however, a
plaintiff “must allege facts, not mere legal
conclusions.” Id.; see also Maya v.
Cenetex Corp., 658 F.3d 1060, 1068 (9th Cir. 2011)
(distinguishing the standards for considering motions under
12(b)(1) and 12(b)(6), but reaffirming that plaintiffs may
not rely on “bare legal conclusion” to assert
standing). If the court determines that it lacks subject
matter jurisdiction, it must dismiss the action. Fed.R.Civ.P.
Incorporation by Reference
courts are not generally permitted to look beyond the
allegations of the complaint when resolving a motion to
dismiss, the doctrine of incorporation by reference allows
courts to consider documents whose contents are alleged in a
complaint and whose authenticity no party questions, but
which are not physically attached to the plaintiff's
pleadings. Knievel v. ESPN, 393 F.3d 1068, 1076 (9th
Cir. 2005). This doctrine extends “to situations in
which the plaintiff's claim depends on the contents of a
document, the defendant attaches the document to its motion
to dismiss, and the parties do not dispute the authenticity
of the document, even though the plaintiff does not
explicitly allege the contents of the document in the
complaint.” Id. Because these documents have
essentially been adopted as part of the complaint, the Court
may consider them without converting the motion to dismiss
into a motion for summary judgment. United States v.
Ritchie, 342 F.3d 903, 908 (9th Cir. 2003) (“Even
if a document is not attached to a complaint, it may be
incorporated by reference into a complaint if the plaintiff
refers extensively to the document or the document forms the
basis of the plaintiff's claim.”).
present case, the lease agreement is not attached to
Plaintiff's complaint, but clearly forms the basis of
Plaintiff's claims against Defendants. The Court
concludes that the lease agreement is a proper subject for
incorporation by reference. By contrast, Plaintiff has
submitted a declaration and supporting exhibits (including a
copy of the lease agreement) with their Response. ECF No. 10.
Although these materials put good deal of flesh on the bare
bones of Plaintiff's Complaint, they are beyond the scope
of a facial attack under Rule 12(b)(1) and so may not be
considered in addressing the substance of Defendants'
motion. As the Court has determined that consideration of the
lease agreement is appropriate under the doctrine of
incorporation by reference, there is no need to consider
Defendants' request in the alternative for judicial
notice of the lease agreement. ECF No. 8.