     16-4187
     Horton v. Wells Fargo Bank, N.A.

                                        UNITED STATES COURT OF APPEALS
                                           FOR THE SECOND CIRCUIT

                                              SUMMARY ORDER

     RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
     SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007 IS PERMITTED AND IS GOVERNED BY
     FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1.
     WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST
     CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE
     NOTATION “SUMMARY ORDER”). A PARTY CITING TO A SUMMARY ORDER MUST SERVE A
     COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

 1          At a stated term of the United States Court of Appeals for the Second Circuit, held at
 2   the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York,
 3   on the 1st day of August, two thousand seventeen.
 4
 5   PRESENT:
 6              ROBERT D. SACK,
 7              SUSAN L. CARNEY,
 8              CHRISTOPHER F. DRONEY,
 9                         Circuit Judges.
10   _____________________________________
11
12   LOVELLA HORTON,
13
14                     Plaintiff-Appellant,
15
16                               v.                                          No. 16-4187
17
18   WELLS FARGO BANK, N.A., THE BANK OF NEW
19   YORK, as trustee for WORLD SAVINGS BANK
20   MORTGAGE PASS THROUGH CERTIFICATES
21   REMIC 29 TRUST, DOES 1 through 100, inclusive,
22
23              Defendants-Appellees.
24   _____________________________________
25
26
27   FOR PLAINTIFF-APPELLANT:                            Steven Bruce Rabitz, Esq., Massapequa,
28                                                       New York.
29
 1   FOR DEFENDANTS-APPELLEES:                            Zalika T. Pierre, Reed Smith LLP, New
 2                                                        York, New York.

 3          Appeal from a judgment of the United States District Court for the Southern District
 4   of New York (Forrest, J.).
 5          UPON DUE CONSIDERATION WHEREOF, IT IS HEREBY ORDERED,
 6   ADJUDGED, AND DECREED that the December 15, 2016 judgment entered by the
 7   District Court is AFFIRMED.
 8          Appellant Lovella Horton appeals from the District Court’s judgment dismissing her
 9   amended complaint. The complaint alleged causes of action arising from the nonjudicial
10   foreclosure on a residential property in California that she once owned, and focusing on
11   Horton’s efforts to secure a loan modification during the foreclosure process. The District
12   Court dismissed Horton’s claims for “Declaratory Relief,” “Constructive Fraud,” “TILA” (the
13   federal Truth in Lending Act), “Slander of Title,” and “California’s HBOR” (the California
14   Homeowner Bill of Rights). Joint Appendix (“J.A.”) 46-47. It also denied further leave to
15   amend the already once-amended complaint. We assume the parties’ familiarity with the
16   underlying facts and the procedural history of this case, to which we refer only as necessary to
17   explain our decision to affirm.
18          On appeal, Horton challenges the dismissal of her claims for declaratory relief,
19   constructive fraud, and HBOR relief, and the District Court’s denial of further leave to
20   amend.1 We conclude that the District Court properly dismissed these claims, and affirm for
21   substantially the reasons stated by the District Court in its thorough and well-reasoned
22   November 2016 opinion.2

     1 Horton does not argue on appeal that the District Court erred in dismissing her TILA and
     slander of title claims. We treat these as abandoned. See LoSacco v. City of Middletown, 71 F.3d 88,
     92 (2d Cir. 1995) (holding issues not raised in appellate brief are abandoned).

     2 Given the litigation’s early stage and the particularities of Horton’s claim under California’s
     HBOR, it may have been advisable for the district court to decline to exercise supplemental
     jurisdiction over her state-law claims and dismiss them without prejudice. See, e.g., TPTCC NY,
     Inc. v. Radiation Therapy Servs., Inc., 453 F. App’x 105, 107 (2d Cir. 2011) (“Based on the

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 1          On de novo review, see Stevelman v. Alias Research Inc., 174 F.3d 79, 83 (2d Cir. 1999), we
 2   agree with the District Court that Horton failed to state a cognizable claim. We first conclude
 3   that the complaint did not state a claim for declaratory relief because California law, which
 4   undisputedly controls here, fatally undermines her theory that her note was improperly
 5   assigned unaccompanied by her deed of trust. See Yvanova v. New Century Mortg. Corp., 365 P.3d
 6   845, 850 (Cal. 2016) (“The deed of trust, moreover, is inseparable from the note it secures, and
 7   follows it even without a separate assignment.”). Second, because the complaint neither
 8   identified particular misstatements or omissions of any defendant nor explained how Horton
 9   relied on any, the District Court correctly ruled that Horton failed to plead with sufficient
10   particularity facts supporting her claim for “constructive fraud.” J.A. 42; see also Fed. R. Civ. P.
11   9(b); Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1102 (9th Cir. 2003) (applying Rule 9(b)’s
12   pleading requirements to federal and California claims). Third, we agree with the District
13   Court that Horton has failed to state a claim under HBOR’s provisions prohibiting “dual
14   tracking.” J.A. 45. That law prohibits lenders from pursuing foreclosure while a “complete first
15   lien loan modification application is pending.” Cal. Civ. Code § 2923.6(c) (emphasis added)).
16   Horton’s complaint, however, does not adequately allege that she ever submitted a complete
17   loan modification application, let alone the date on which her application became complete, or
18   that she was in fact qualified for relief. This failure to allege “factual allegations sufficient ‘to
19   raise a right to relief above the speculative level’” is fatal to Horton’s dual tracking claim. ATSI
20   Commc’ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87, 98 (2d Cir. 2007) (quoting Bell Atl. Corp. v.


     preliminary stage of the litigation and the substantial divergence between the federal and state
     law claims at issue, we are persuaded that this case is the usual case in which all federal-law
     claims are eliminated before trial such that the balance of factors to be considered judicial
     economy, convenience, fairness, and comity will point toward declining to exercise jurisdiction
     over the remaining state-law claims.” (internal quotation marks and alterations omitted)); see
     also Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 (1988). Nevertheless, we review a district
     court’s exercise of supplemental jurisdiction over state-law claims for abuse of discretion,
     Kroshnyi v. US. Pack Courier Servs., Inc., 771 F.3d 93, 102 (2d Cir. 2014), and Horton has not
     argued that any such abuse occurred here.


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 1   Twombly, 550 U.S. 544, 555 (2007)); see also Galindo v. BSI Fin. Servs., Inc., No. 17-cv-21 (LHK),
 2   2017 WL 1036735, at *9 (N.D. Cal. Mar. 17, 2017) (dismissing “dual tracking” claim for failure
 3   to allege loan modification application was “complete”); Villacis v. Ocwen Loan Servicing, LLC,
 4   No. 14-cv-3279 (JD), 2015 WL 2227913, at *2 (N.D. Cal. May 12, 2015) (dismissing HBOR
 5   claim for failure to “allege the date on which [the plaintiff] submitted a complete first lien loan
 6   modification”).3
 7          Finally, Horton challenges the District Court’s refusal, because of futility, to grant her
 8   leave to amend her amended complaint once again. When the “denial of leave to file a revised
 9   pleading is based on a legal interpretation, such as futility, [we] conduct[] a de novo review.”
10   Balintulo v. Ford Motor Co., 796 F.3d 160, 164 (2d Cir. 2015). Having done so, we conclude that
11   the District Court’s determination was sound. Even on appeal, Horton “has still given no clue
12   as to how the complaint’s defects would be cured through an amendment.” F5 Capital v.
13   Pappas, 856 F.3d 61, 89 (2d Cir. 2017) (internal quotation marks and alteration omitted). We
14   thus identify no error in the District Court’s denial of a second opportunity to amend.
15          We have considered all of Horton’s remaining arguments and find them to be without
16   merit. Accordingly, we AFFIRM the December 15, 2016 judgment of the District Court.
17
18                                                FOR THE COURT:
19                                                Catherine O’Hagan Wolfe, Clerk of Court




     3For the first time on appeal, Horton argues that defendants also violated California Business
     and Professional Code § 17203 and Regulation X of the Real Estate Settlement Procedures
     Act, 12 C.F.R. § 1024.41. Having failed to raise these claims in her amended complaint or
     before the District Court, however, Horton has forfeited them. See Greene v. United States, 13
     F.3d 577, 586 (2d Cir. 1994).

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