MORRISON C. ENGLAND, Jr., District Judge.
This action proceeds on Plaintiff James Kouretas' ("Plaintiff") Second Amended Complaint ("SAC") seeking to recover from Defendants Bank of America ("BANA") and Nationstar Mortgage Holdings, Inc. ("Nationstar") (collectively "Defendants"). On April 7, 2014, Plaintiff filed a First Amended Complaint ("FAC"), asserting causes of action for breach of the implied covenant of good faith and fair dealing, wrongful foreclosure, and financial elder abuse in violation of state law. ECF No. 32. On Defendants' motions, the Court dismissed all but one of the claims with prejudice. ECF No. 49. Plaintiff was given twenty days to amend the implied covenant claim to cure deficiencies noted by the Court.
Plaintiff holds title to the property known as 3324 S Street, Sacramento, California, 95816 ("the Property"). The Property was secured by a first deed of trust in favor of BANA. In November 2013, Nationstar became the loan servicer.
In May 2013, Plaintiff wrote to BANA to request a loan modification. Plaintiff was told in several letters from BANA staff that his loan modification application had been received and was being forwarded to the appropriate department. While the loan modification was pending, BANA served Plaintiff with a notice of default on his home loan. In October 2013, BANA notified Plaintiff that they were denying his loan modification. Then, in November 2013, Nationstar wrote to Plaintiff that BANA had transferred the mortgage note to them. Plaintiff claims that Nationstar made the following statements in its letter: "[B]ased on the information we have received from your previous mortgage servicer, we believe you may be experiencing a financial hardship. We want to help you stay in your home." However, in December 2013, Plaintiff was notified that his home would be sold in a trustee's sale approximately a week later. That sale never took place, and Plaintiff continues to hold title to the Property.
On a motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6),
Furthermore, "Rule 8(a)(2) . . . requires a showing, rather than a blanket assertion, of entitlement to relief."
A court granting a motion to dismiss a complaint must then decide whether to grant leave to amend. Leave to amend should be "freely given" where there is no "undue delay, bad faith or dilatory motive on the part of the movant, . . . undue prejudice to the opposing party by virtue of allowance of the amendment, [or] futility of the amendment. . ."
In the order that dismissed Plaintiff's FAC, the Court granted Plaintiff leave to amend his claim for breach of the implied covenant of good faith and fair dealing. ECF No. 49 at 10. However, in his operative SAC, Plaintiff does not allege liability under a theory of breach of the implied covenant of good faith and fair dealing. Instead, he brings two new claims—promissory estoppel and violation of the unfair competition law—and attempts to revive his RICO violation claim that was dismissed from his original complaint.
Procedurally, all of Plaintiff's claims are impermissible because Plaintiff failed to obtain leave of the Court to add these three claims against Defendants. "When the language of an order clearly states that a plaintiff may only amend to address certain deficiencies identified in the order, courts [in this circuit] have held that a plaintiff is barred from adding new claims or parties."
In addition to this procedural defect, Plaintiff's claims also fail substantively, as described below.
In Plaintiff's first cause of action, he claims that Defendants were required to consider his loan modification under the doctrine of promissory estoppel. Defendants argue that Plaintiff's claim fails because he has not alleged a promise. The Court agrees.
Under California law, a cause of action for promissory estoppel requires that plaintiff show "(1) a clear promise, (2) reliance, (3) substantial detriment, and (4) damages `measured by the extent of the obligation assumed and not performed.'"
Here, Plaintiff's promissory estoppel claim alleges that both Defendants "promised to consider [Plaintiff]—in good faith—for a modification of the loan on his property." SAC, ECF No. 51, at ¶ 20. Despite this assertion, Defendants' letters do not plausibly show that a "clear and unambiguous" promise was made to Plaintiff. First, BANA's statement that it would forward, and eventually did forward, Plaintiff's loan modification application to the appropriate department does not constitute a promise that the loan would be modified or even that the loan modification application would indeed be reviewed. The letters simply indicate that the loan modification application was being transferred. Second, Nationstar's statements that it wanted to help Plaintiff stay in his home are even less clear than those of BANA's. There are no words that specify how they would "help" him, or even a suggestion that they wanted to do anything other than be paid for the mortgage that they had just taken over. Even when viewed in the light most favorable to Plaintiff, the BANA and Nationstar letters do not provide any of the essential terms of a promise to consider Plaintiff's loan modification.
Without a clear promise, Plaintiff fails to adequately allege promissory estoppel. Furthermore, although this is the first time Plaintiff has alleged this particular cause of action, he has now had three opportunities to state a cognizable claim and, with each complaint, he has alleged almost identical facts. ECF No. 1 at ¶¶ 1-17; ECF No. 32 at ¶¶ 1-17; ECF No. 27 at ¶¶ 1-17. Leave to amend is properly denied "where the movant presents no new facts but only new theories and provides no satisfactory explanation for his failure to fully develop his contentions originally."
Next, Plaintiff's second cause of action is for violation of the California Unfair Competition Law ("UCL"). Defendants argue that Plaintiff's claim fails for lack of standing. The Court agrees.
Section 17204 of the California Business and Professions Code limits standing to bring a UCL claim to specified public officials and a private person "who has suffered injury in fact and has lost money or property as a result of the unfair competition." As such, to have standing, Plaintiff must allege facts that he suffered an economic injury from loss of money or property sufficient to constitute an "injury in fact."
Finally, Plaintiff alleges that Defendants violated RICO, 18 U.S.C. § 1962, in connection with the loan modification process and the transfer of his loan to Nationstar. Plaintiff also alleged this claim in his original complaint, but the Court dismissed it for failing to allege acts that constitute racketeering activity, failing to plead fraudulent actions with particularity, and failing to allege a concrete financial loss to his business or property. ECF No. 27 at 8-9. The Court granted Plaintiff leave to amend the claim within twenty days, but he failed to re-assert the RICO allegations in his FAC. Because Plaintiff declined to file an amended RICO claim within the appropriate time frame, Plaintiff's RICO claim was dismissed with prejudice "without further notice to the parties."
Regardless, Plaintiff's RICO claim is substantively defective because he alleges no new facts in the SAC to support his claim. For example, to state a RICO claim, Plaintiff must allege that Defendants engaged in a pattern of racketeering activity.
For the reasons set forth above, Defendants' Motions to Dismiss (ECF Nos. 64, 66) are GRANTED without leave to amend. The Clerk of the Court is directed to close this case.