Judge: John J. Kralik, Case: 21BBCV00979, Date: 2022-08-05 Tentative Ruling

Case Number: 21BBCV00979    Hearing Date: August 5, 2022    Dept: NCB

Superior Court of California

County of Los Angeles

North Central District

Department B

BACKGROUND

A.    Allegations

Plaintiff Eduardo Vallejo (“Plaintiff”) commenced this action against Defendant Select Portfolio Servicing, Inc. (“Defendant”) on November 15, 2021.  Plaintiff filed the first amended complaint (“FAC”) on April 4, 2022, alleging a single cause of action for violation of the Rosenthal Fair Debt Collection Practices Act (“the Act”). 

Plaintiff alleges that he incurred a consumer credit transaction debt and that Defendant has made efforts to collection the debt from Plaintiff.  Plaintiff alleges that he retained an attorney, informed Defendant via email, and Defendant acknowledged that Plaintiff was represented by counsel.  Nevertheless, Plaintiff alleges that Defendant mailed Plaintiff a letter to collect on the debt.  Plaintiff seeks damages for Defendant’s violation of the Act.

B.     Demurrer on Calendar

On May 26, 2022, Defendant filed a demurrer to the FAC.

On July 5, 2022, Plaintiff filed a “Request for Judicial Notice” of Omnibus demurrer to the FAC and Appeal Case No. 22-55624.

On July 28, 2022, Defendant filed a reply brief.

REQUEST FOR JUDICIAL NOTICE

            Defendant requests judicial notice of: (1) the order granting the motion to declare Plaintiff a vexatious litigant filed on March 3, 2021 in U.S. Bankruptcy Court, Central District of California, Case No. 2:20-ap-01648-SK in Eduardo Vallejo v. US Bank Trust et al.; (2) the Court’s memorandum of decision on the “Motion to Declare Plaintiff a Vexatious Litigant”, Docket #87 filed by U.S. Bank Trust, N.A. filed on March 2, 2021 in the U.S. Bankruptcy Court, Central District of California, Case No. 2:20-ap-01648-SK in the aforementioned case; and (3) the notice of ruling on demurrer to the FAC and motion to deem Plaintiff a vexatious litigant filed on April 21, 2022 in LASC Case No. 20STCV45290.  The request is granted.  (Evid. Code, § 452(d).) 

DISCUSSION

A.    Appeal and Request for Continuance

            In his opposition, Plaintiff states that the U.S. Court of Appeal for the Ninth Circuit “admitted Plaintiff’s Appeal with Number: 22-55624, of the Order of Remand to this Court.”  (Opp. at p.1.)  He argues that while he has attached his omnibus opposition to the demurrer, this case is now removed to the Ninth Circuit.  He asks for a continuance of all activities in this action until further notice from the Ninth Circuit. 

In reply, Defendant argues that Plaintiff is seeking to delay this action and the demurrer hearing by appealing the District Court’s order remanding this action back to State Court.  Defendant argues that the remand order is not reviewable such that the appeal is frivolous.  (See 28 U.S.C. § 1447(d) [“An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1442 or 1443 of this title shall be reviewable by appeal or otherwise.”].)  Defendant argues that the matter was not remanded pursuant to sections 1442 or 1443.  Defendant relies on Seedman v. U.S. Dist. Court for Cent. Dist. of California (9th Cir. 1988) 837 F.2d 413, 414: 

28 U.S.C. § 1447(c) requires a district court to remand a case to state court when it determines the case was improvidently removed. Remand orders based on section 1447(c) are unreviewable on “appeal or otherwise.”  28 U.S.C. § 1447(d).

This language has been universally construed to preclude not only appellate review but also reconsideration by the district court. Once a district court certifies a remand order to state court it is divested of jurisdiction and can take no further action on the case. [Citations.]

Contrary to respondent's position, a second removal petition based on the same grounds does not “reinvest” the court's jurisdiction. See Federal Deposit Insurance Corp., 598 F.2d at 636. A remand order returns the case to the state courts and the federal court has no power to retrieve it. As the statute makes clear, if the remand order is based on section 1447(c), a district court has no power to correct or vacate it. Id.

(Seedman, supra, 837 F.2d at 414 [citations omitted].)  Based on these authorities, Defendant argues that the Court should deny Plaintiff’s improper motion to continue the hearing on the demurrer.

            Although Plaintiff has filed an appeal on the remand order, as noted by the legal authorities above, such a remand order is not reviewable on appeal.  Further, Plaintiff is not prejudiced by the Court ruling on this demurrer as Plaintiff has included his substantive opposition arguments to the demurrer with his request for continuance.  Thus, the Court denies Plaintiff’s request to continue the demurrer hearing and will address the substantive merits of the demurrer. 

B.     Discussion

Defendant demurs to the FAC on the ground that the sole cause of action for violation of the Act fails to state sufficient facts to constitute a cause of action against it.

First, Defendant argues that it cannot be liable under the Act for communicating with Plaintiff because Defendant is not a “debt collector” as defined by the Act. 

In the complaint, Plaintiff alleges that Defendant engaged in debt collection and is a “debt collector” as defined by Civil Code, § 1788.2(c).  (FAC, ¶11.)  Plaintiff alleges that Defendant’s communications with Plaintiff after being notified in writing that he was represented by counsel is a violation of section 1788.14(c).  (Id., ¶12.) 

Section 1788.2(c) defines “debt collector” as: “any person who, in the ordinary course of business, regularly, on behalf of that person or others, engages in debt collection. The term includes any person who composes and sells, or offers to compose and sell, forms, letters, and other collection media used or intended to be used for debt collection.” 

Defendant argues that the Act’s definition of debt collector “does not include the consumer's creditors, a mortgage servicing company, or any assignee of the debt.” (Lal v. American Home Servicing, Inc. (E.D. Cal. 2010) 680 F.Supp.2d 1218, 1224.)  Defendant raised this argument before and the Court previously noted that the initial complaint did not allege what kind of business Defendant was engaged in or the nature of the debt other than to allege that Defendant is a business corporation and that Plaintiff allegedly incurred a “consumer credit transaction” pursuant to Civil Code, § 1788.2(e).  (Compl., ¶¶3-4.)  The FAC makes the same allegations and does not explain the nature of Defendant’s business operation.  (FAC, ¶¶2-3.)  In the demurrer papers, Defendant attempts to explain what type of work it is engaged in.  However, at this time, such arguments in the demurrer constitute extrinsic facts that cannot be considered on demurrer as they are outside the scope of what is alleged in the FAC. 

The Court previously ruled on the demurrer to the initial complaint, finding that the complaint lacked facts regarding what kind of business Defendant engaged in and the nature of the consumer debt alleged.  The Court previously sustained the demurrer with leave to amend to give Plaintiff the opportunity to allege such facts.  In opposition, Plaintiff provides a history of the chain of title to the property located at 508 N. California St. in Burbank and the loan history; however, none of these are facts alleged in the complaint.  Further, upon amendment, Plaintiff has failed to allege such facts regarding the type of business Defendant is engaged in to ascertain whether Defendant is in fact a debt collector and what the nature of the debt is. 

Second, Defendant argues that the first cause of action is without merit because Plaintiff has not included the purported communications as an exhibit to his complaint so as to know whether the Act was triggered and, if so, whether SPS violated it.  Defendant argues that pursuant to the code, it is allowed to communicate with Plaintiff to provide statements of his account. 

Section 1788.14(c) states: “No debt collector shall collect or attempt to collect a consumer debt by means of the following practices: … (c) Initiating communications, other than statements of account, with the debtor with regard to the consumer debt, when the debt collector has been previously notified in writing by the debtor's attorney that the debtor is represented by the attorney with respect to the consumer debt and the notice includes the attorney's name and address and a request by the attorney that all communications regarding the consumer debt be addressed to the attorney, unless the attorney fails to answer correspondence, return telephone calls, or discuss the obligation in question. This subdivision shall not apply if prior approval has been obtained from the debtor's attorney, or if the communication is a response in the ordinary course of business to a debtor's inquiry.”  (Civ. Code, § 1788.14(c) [emphasis added].)

The Court previously sustained the demurrer to the initial complaint on this basis as well, finding that it was unclear what the nature of communications that Defendant allegedly initiated after Plaintiff had informed Defendant that he was represented by counsel.  (See Compl., ¶14.)  The same ambiguity persists in the FAC.  (See FAC, ¶12.)  The FAC is only 3 pages in length and does not include any supporting facts for its allegations and does not include any exhibits.  Thus, the Court will sustain the demurrer on this basis as well.

            In opposition, Plaintiff brings in many different facts and arguments about a loan for real property, his payment history, etc. None of these were facts alleged in the complaint.  While certain documents regarding chain of title may be judicially noticeable, as discussed above, Plaintiff has not even alleged the nature of the debt or the nature of the parties’ relationship in the FAC.  Next, Plaintiff argues that he has stated claims for declaratory relief and breach of contract; however, no such causes of action were alleged in the FAC, nor will the Court provide leave for Plaintiff to allege such causes of action upon amendment by way of this demurrer order.  Rather, Plaintiff’s sole cause of action alleged in the FAC is for violation of the Rosenthal Fair Debt Collection Practices Act. 

            The extensive history of this and other litigation filed by Plaintiff establishes a sufficient record to conclude that the Plaintiff cannot successfully amend this complaint. Therefore, leave to amend is denied.

CONCLUSION AND ORDER

Defendant Select Portfolio Servicing, Inc. demurrer to the First Amended Complaint is sustained without leave to amend.  Therefore, this case is dismissed with prejudice.

Defendant shall provide notice of this order.