Saturday, August 17, 2013


 See prior order:  BARRIONUEVO v. CHASE BANK, NA, Dist. Court, ND California  2012 (Docket No. 41)


JOSE BARRIONUEVO, et al., Plaintiffs,
CHASE BANK, N.A., et. al., Defendants.

No. C-12-0572 EMC.
United States District Court, N.D. California.
August 12, 2013.


(Docket No. 63)

EDWARD M. CHEN, District Judge.
Despite plenary discovery, however, Plaintiffs have failed to produce competent evidence that Chase lacked the authority to foreclose. Plaintiffs cannot rely on allegations in their complaint to create a genuine issue. Gasaway v. N.W. Mut. Life Ins. Co., 26 F.3d 957, 959-60 (9th Cir. 1994) (Nonmoving party must "go beyond the pleadings and show `by her own affidavits, or by the depositions, answers to interrogatories, or admissions on file,' that a genuine issue of material fact exists." 885 (quoting Celotex, 477 U.S. at 324, 106 S.Ct. at 2553). "[A]n adverse party may not rest upon the mere allegations or denials of [her] pleadings." Fed. R. Civ. P. 56[e].)

Instead, Plaintiffs rely heavily on an audit report prepared by Michael Carrigan ("Carrigan Audit"), an initially disclosed but later withdrawn expert witness. However, the Carrigan Audit does not raise a genuine issue because it cannot be relied upon.See Walton v. U.S. Marshals Serv., 492 F.3d 998, 1008 (9th Cir. 2007) ("[e]xpert opinion is admissible and may defeat summary judgment if it appears the affiant is competent to give an expert opinion and the factual basis for the opinion is stated in the affidavit"; finding expert opinion did not create a genuine issue of material fact because expert identified no facts supporting his opinion). Here, Carrigan's opinion — that the Loan was securitized and the Property sold to the Trust — is based on insufficient facts and amounts to speculation.
 . . .
See id. (bold emphasis in original; italics emphasis added). This quote only indicates Mr. Carrigan performed a search on the United States Securities and Exchange Commission (SEC) website and located a possible trust into which the Loan and Property may have been securitized. Once Mr. Carrigan identified a potential trust, he was able to locate this trust using the Bloomberg database. Significantly, however, Mr. Carrigan admits in deposition he was not able to locate the Loan and Property using "loan-level detail." This deficiency is significant because Certified Forensic Loan Auditors, LLC advertises the fact that loan-level detail is how a real property loan is identified to have been securitized into a trust.[3] Accordingly, Mr. Carrigan admitted in deposition that he "lacked hard evidence of securitization." See id. (Ex. F to Hedger Decl.) (Carrigan Depo., at pp. 19-20). His assertion that the loan in question was securitized in 2006 is thus speculative. Plaintiffs fail to raise a genuine issue as to whether the loan was securitized. This alone would warrant granting summary judgment in favor of Chase.
.  .  .
Chase has produced evidence to support an inference that the Property was not securitized before 2008, when Chase purportedly obtained a beneficial interest in the Property. It has provided sworn testimony that it possesses signed originals of the note and deed of trust to the Property. See Docket No. 75-1 (Supplemental Waller Decl., ¶ 5 and Ex. A thereto). Chase also produced electronic database records which indicates it had a beneficial interest in the Property at the time of foreclosure. These records consist of recent screen captures of Chase's business records found in a collateral loan file that are maintained electronically on Chase's computer systems. First, a screen capture from this electronic database indicates that the "ACQUISITION TYPE" of the Loan in questioin is "bank originated," and not merely a service agreement for a pooled loan. See Docket No. 75-2 (Ex. B to Supplemental Waller Decl.). Second, another screen capture from the same internal electronic database lists Chase as the "investor" or owner of the Loan, and there is no record of any transfer of Chase's interest to another investor. See id. (Ex. C to Supplemental Waller Decl.). See id. (Exs. C and D to Supplemental Waller Decl., ¶¶ 10-11). These documents are corroborated by Carrigan's deposition testimony. See Docket No. 63-1 (Ex. F to Hedger Decl.) (Carrigan Depo., at p. 32) ("Q: Is there any other entity besides JP Morgan Chase, to your knowledge, that has asserted ownership of the loan in question? A: No."). Finally, Plaintiffs' loan number is not listed among the 646 loans originated by Washington Mutual which were securitized into the trust. See id.(Ex. E to Supplemental Waller Decl.).

Accordingly, Chase has produced sufficient evidence upon which a jury could reasonably conclude that the Loan was sold to the Trust in 2006; thus, Chase acquired ownership of the Loan and had sufficient authority to foreclose on the Property.
. . . 
Again, Plaintiffs have produced no evidence to show that the PAA, the 2008 agreement between Chase and WaMu, did not convey the Loan and Property to Chase. By contrast, Chase has offered evidence the Loan and Property had been so conveyed. See Docket No. 63-2 (Waller Decl., ¶ 8); Docket No. 75-1 (Suppl. Waller Decl., ¶ 10) ("The `investor' is the entity that currently owns the loan. The investor name highlighted is [Chase]."); Docket No. 75-2 (Ex. C to Suppl. Waller Decl.). Second, Plaintiffs' contention that Chase acted with a reckless disregard for the truth is contradicted by Waller's sworn affidavit indicating Chase possesses the original promissory note and deed of trust securing the Property. See Docket No. 63-2 (Waller Decl., ¶ 7); Docket No. 75-1 (Suppl. Waller Decl., ¶ 5) (copies of the original note and deed of trust produced as Ex. A to the Suppl. Waller Decl.). Because Plaintiffs have failed to meet their burden that Chase acted with a reckless disregard for the truth, recordation of the foreclosure documents is presumed privileged.

1 comment:

  1. The lesson to be learned is that CFLA is a known scam outfit, and their audits are as well.