                                                          FILED
                                                             1/28/2014
 1                                                     SUSAN M. SPRAUL, CLERK
                                                         U.S. BKCY. APP. PANEL
                                                         OF THE NINTH CIRCUIT
 2
 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
 4                            OF THE NINTH CIRCUIT
 5   In re:                        )      BAP No.      CC-12-1608-KuBaPa
                                   )
 6   BENJAMIN MENJIVAR,            )      Bk. No.      LA 11-61208-NB
                                   )
 7                  Debtor.        )      Adv. No.     LA 12-01125-NB
     ______________________________)
 8                                 )
     BENJAMIN MENJIVAR; SARA       )
 9   MENJIVAR,                     )
                                   )
10                  Appellants,    )
                                   )
11   v.                            )      MEMORANDUM*
                                   )
12   WELLS FARGO BANK, N.A.,       )
                                   )
13                  Appellee.      )
     ______________________________)
14
                          Argued on November 21, 2013
15                          at Pasadena, California
16                       Submitted on January 28, 2014
17                          Filed – January 28, 2014
18               Appeal from the United States Bankruptcy Court
                     for the Central District of California
19
              Honorable Neil W. Bason, Bankruptcy Judge, Presiding
20
21   Appearances:     Philip Eberhard Koebel, Esq. argued for appellants
                      Benjamin and Sara Menjivar; Robert Collings
22                    Little, Esq. of Anglin, Flewelling, Rasmussen,
                      Campbell & Tryttenn LLP argued for appellee Wells
23                    Fargo Bank, N.A.
24
25
26        *
           This disposition is not appropriate for publication.
27   Although it may be cited for whatever persuasive value it may
     have (see Fed. R. App. P. 32.1), it has no precedential value.
28   See 9th Cir. BAP Rule 8013-1.
 1   Before: KURTZ, BALLINGER** and PAPPAS, Bankruptcy Judges.
 2                               INTRODUCTION1
 3        Debtors Benjamin and Sarah Menjivar commenced an adversary
 4   proceeding against Wells Fargo Bank (“WFB”) seeking damages and
 5   seeking to invalidate WFB’s trust deed against their residence.
 6   The bankruptcy court dismissed all of the Menjivars’ claims for
 7   relief without leave to amend, and the Menjivars appealed.
 8        None of the Menjivars’ allegations stated a claim for relief
 9   plausible on its face.    Nor were there any amendments consistent
10   with the Menjivars’ existing allegations that would have cured
11   the fatal deficiencies in their first amended complaint (“FAC”).
12   The bankruptcy court properly dismissed their FAC without leave
13   to amend, so we AFFIRM.
14                                  FACTS2
15        In October 2005, the Menjivars obtained a loan from WFB’s
16   predecessor World Savings Bank in order to refinance the first
17
18        **
           Hon. Eddward P. Ballinger, Jr., United States Bankruptcy
19   Judge for the District of Arizona, sitting by designation.

20        1
           Unless specified otherwise, all chapter and section
     references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532, and
21   all "Rule" references are to the Federal Rules of Bankruptcy
22   Procedure, Rules 1001-9037. All "Civil Rule" references are to
     the Federal Rules of Civil Procedure.
23
          2
           Most of the facts stated herein are drawn from the
24   Menjivars’ FAC. To the extent the Menjivars’ factual allegations
     are well pleaded, we accept them as true. We also draw some of
25   the facts from documents referenced in the FAC or which were
26   submitted by WFB in support of its motion to dismiss and which
     are properly subject to judicial notice. See United States v.
27   Ritchie, 342 F.3d 903, 907–08 (9th Cir. 2003) (discussing
     circumstances under which facts are deemed true for purposes of
28   considering a Civil Rule 12(b)(6) dismissal motion).

                                       2
 1   and second trust deeds on their residence.      In January 2007,
 2   World Savings Bank persuaded the Menjivars to once again
 3   refinance their residence.    The Menjivars admit that $516,147.97
 4   of the loan proceeds from their January 2007 refinancing were
 5   used to pay off their 2005 home loan, that they also received
 6   $13,462.50 in cash from the January 2007 refinancing, that they
 7   signed a promissory note agreeing to repay $538,750.00, and that
 8   the January 2007 note was secured by a deed of trust on their
 9   residence.
10           In July 2007, World Savings Bank persuaded the Menjivars to
11   refinance their residence a third time.      According to the
12   Menjivars, World Savings Bank persuaded the couple to refinance
13   by representing that the Menjivars would receive a home loan with
14   a fixed interest rate.    But the loan documents the Menjivars
15   signed plainly stated otherwise.       The loan documentation also
16   stated that the Menjivars’ combined monthly income was $10,600,
17   which the Menjivars now admit was inaccurately high.      They only
18   noticed this inaccuracy when they reviewed the loan documentation
19   later on, presumably after their dispute with WFB arose.
20           The Menjivars claim that, at closing, they were surprised by
21   the total amount of settlement charges and fees they had to pay,
22   particularly the roughly $4,000 they had to pay in cash in order
23   for the July 2007 refinancing to close.      They further claim that
24   World Savings Bank pressured them to close quickly.
25           According to the FAC, the Menjivars blame the stress of the
26   July 2007 refinancing for a severe stroke Ms. Menjivar suffered
27   in August 2007 and for the death of their mentally-ill son in
28   2008.    But the Menjivars have not alleged any legally-cognizable

                                        3
 1   connection between the July 2007 refinancing and these tragedies.
 2        At some point, WFB became the successor by merger to World
 3   Savings Bank’s rights under the July 2007 note and deed of
 4   trust.3   The Menjivars requested that WFB refinance them into a
 5   fixed rate loan.   But by this time, the national mortgage crisis
 6   already was underway, and WFB told the Menjivars that WFB would
 7   only consider refinancing them if they were in default on the
 8   July 2007 note.    Based on the information from WFB, the Menjivars
 9   defaulted on the 2007 note by not making their mortgage payments.
10   WFB recorded a notice of default in August 2010 and a notice of
11   trustee’s sale in November 2010.
12        In November 2010, with the trustee’s sale looming, the
13   Menjivars sued WFB in the Los Angeles County Superior Court (LASC
14   Case No. GC046375) (“First State Court Lawsuit”) and obtained a
15   temporary restraining order temporarily enjoining the sale
16   pending further proceedings.   But WFB countered by removing the
17   First State Court Lawsuit to the United States District Court for
18   the Central District of California. (USDC Case No. 10-CV-09628).
19   Ultimately, the temporary injunction terminated, and the
20   Menjivars voluntarily dismissed the First State Court Lawsuit.4
21
          3
22         According to the documents attached to WFB’s request for
     judicial notice filed in support of its dismissal motion, World
23   Savings Bank changed its name in 2008 to Wachovia Mortgage, FSB,
     and in 2009 changed it name again to Wells Fargo Bank Southwest,
24   N.A., and merged into WFB. The Menjivars never objected to WFB’s
     judicial notice request and have never disputed WFB’s explanation
25   of how it became the creditor holding the July 2007 note and
26   trust deed. The explanation also is generally consistent with
     the FAC’s allegations regarding World Savings Bank and WFB.
27
          4
           We have reviewed the district court’s case docket, and we
28                                                      (continued...)

                                        4
 1        In January 2011, the Menjivars filed a new state court
 2   lawsuit (LASC Case No. GC046687) (“Second State Court Lawsuit”),
 3   and immediately sought a new temporary restraining order to
 4   prevent WFB’s imminent trustee’s sale.5      When it became apparent
 5   that the Menjivars would not be able to obtain a temporary
 6   restraining order before the date of the trustee’s sale,
 7   Ms. Menjivar filed a chapter 13 bankruptcy case (USBC Case No.
 8   LA 11-012361-EC).    That case was dismissed in March 2011 because
 9   the debtor did not file one of the papers required to support her
10   bankruptcy filing.
11        In February 2011, shortly before WFB’s rescheduled
12   foreclosure sale, Mr. Menjivar filed a chapter 13 bankruptcy case
13   (USBC Case No. LA 11-017774-WB).       In December 2011, at the
14   confirmation hearing held in Mr. Menjivar’s bankruptcy case, the
15   bankruptcy court dismissed the bankruptcy case.      According to the
16   Menjivars, they did not oppose the case dismissal because they
17
          4
           (...continued)
18
     can take judicial notice of that docket and the imaged documents
19   attached thereto. See Estate of Blue v. County of Los Angeles,
     120 F.3d 982, 984 (9th Cir. 1997); Mullis v. Bankr. Ct., 828 F.2d
20   1385, 1388 & n.9 (9th Cir. 1987). Their original state court
     complaint on file therein reflects that the First State Court
21   Lawsuit arose from the same refinancing transactions and loan
22   modification attempts referenced in their subsequent state court
     lawsuit and in the FAC. That original complaint stated seventeen
23   causes of action, including but not limited to violation of the
     Truth In Lending Act, violation of the Real Estate Settlement
24   Procedures Act, fraud, predatory lending and unlawful
     foreclosure.
25
          5
26         The complaint in the Second State Court Lawsuit was
     similar but not identical to the Menjivars’ complaint in the
27   First State Court Lawsuit. It was based on essentially the same
     predicate facts, but the stated causes of action were slightly
28   different.

                                        5
 1   believed that WFB would not offer them a loan modification unless
 2   the bankruptcy case was dismissed.
 3        Also in December 2011, WFB offered to refinance the
 4   Menjivars.   This refinance offer consisted of a three-month trial
 5   loan modification program, which provided in relevant part for
 6   three months of mortgage payments at roughly $2,000 per month,
 7   with a modified interest rate of 2%.
 8        In May 2012, WFB sent the Menjivars documentation for a
 9   permanent loan modification.   The Menjivars wanted to accept the
10   permanent loan modification offer, but they also wanted to
11   continue to litigate over the validity of the July 2007 note and
12   trust deed, so they attempted to amend the permanent loan
13   modification documents by striking out the paragraph reaffirming
14   the July 2007 note and trust deed but otherwise accepting the
15   permanent loan modification documents as drafted.   WFB rejected
16   the permanent loan modification documents as amended by the
17   Menjivars.
18        Mr. Menjivar filed in December 2011 a new chapter 13
19   bankruptcy case, the case in which the underlying adversary
20   proceeding was commenced.   According to the Menjivars, this
21   latest case was necessitated by the wrongful repossession of
22   their automobile by a creditor not associated with the underlying
23   adversary proceeding.   Up until January 2012, their Second State
24   Court Lawsuit remained dormant while the Menjivars’ serial
25   bankruptcy cases proceeded.    But the Menjivars then removed the
26   Second State Court Lawsuit to the bankruptcy court, on
27   January 30, 2012, thereby commencing the adversary proceeding.
28        On July 31, 2012, the Menjivars filed the FAC.    The FAC

                                       6
 1   relied on essentially the same facts as their two state court
 2   complaints, but many of the claims for relief set forth in the
 3   FAC were new.   The FAC claims for relief generally fall into one
 4   of several categories: (1) they allege that the 2007 notes and
 5   trust deeds were constructive fraudulent transfers under
 6   California law; (2) they allege that the 2007 notes and trust
 7   deeds were actual fraudulent transfers under California law;
 8   (3) they allege that World Savings Bank fraudulently induced them
 9   to enter into the July 2007 refinancing by misrepresenting that
10   the refinancing would be for a fixed rate loan when in reality it
11   was for an adjustable rate loan; (4) they allege that World
12   Savings Bank did not give them any consideration whatsoever in
13   exchange for the 2007 notes and trust deeds; (5) they allege that
14   World Savings Bank violated the Truth in Lending Act (“TILA”);
15   and (6) they allege that World Savings Bank violated the Fair
16   Housing Act (“FHA”) and the Equal Credit Opportunity Act
17   (“ECOA”).   Based on all of these claims, the Menjivars sought to
18   invalidate the 2007 notes and trust deeds, and sought actual
19   damages, statutory damages, punitive damages, injunctive relief,
20   to quiet title, and costs and attorney’s fees.
21        WFB filed a Civil Rule 12(b)(6) motion to dismiss, and the
22   Menjivars opposed the motion.   The bankruptcy court heard the
23   dismissal motion on October 25, 2012, and entered an order
24   granting the motion with prejudice on November 7, 2012.6   The
25
          6
26         The bankruptcy court’s initial dismissal order stated that
     the dismissal was without prejudice but, upon limited remand from
27   this Panel, the bankruptcy court corrected the dismissal order to
     clarify that the dismissal was with prejudice and without leave
28                                                      (continued...)

                                      7
 1   hearing transcript and the tentative ruling incorporated into the
 2   court’s dismissal order reflect that the court essentially
 3   adopted the grounds for dismissal presented by WFB.   In
 4   particular, the bankruptcy court held that some of the claims for
 5   relief were barred by the applicable statutes of limitation and
 6   others could not be reconciled with the contents of the loan
 7   documentation underlying the claims.   The bankruptcy court
 8   further opined that the Menjivar’s claims based on state law
 9   appeared to be preempted by the Home Owners' Loan Act of 1933
10   (“HOLA”).   The Menjivars timely filed their notice of appeal on
11   November 21, 2012.7
12                              JURISDICTION
13        The bankruptcy court had jurisdiction pursuant to 28 U.S.C.
14
15
16
17        6
           (...continued)
     to amend.
18
          7
19         Shortly before oral argument in this appeal, Mr. Menjivar’s
     current bankruptcy case was converted from chapter 13 to
20   chapter 7. The Menjivars’ claims for relief at least in part
     were property of Mr. Menjivar’s bankruptcy estate and, hence, the
21   chapter 7 trustee had a direct interest in the outcome of this
     appeal. See McGuire v. United States, 550 F.3d 903, 914 (9th
22
     Cir. 2008); Estate of Spirtos v. One San Bernardino County
23   Superior Court Case, 443 F.3d 1172, 1175-76 (9th Cir. 2006).
     Accordingly, we issued an order deferring submission of this
24   appeal and directing the chapter 7 trustee to advise us whether
     he desired to appear in this appeal. The trustee then filed a
25   response indicating that he had no intention of participating in
26   this appeal. He subsequently filed a supplemental response
     indicating that he has abandoned the estate’s interest in the
27   Menjivars’ real property and in the associated claims for relief.
     As a result, this appeal has been taken under submission and is
28   now ready for decision.

                                      8
 1   §§ 1334 and 157(b)(2)(K).8   We have jurisdiction under 28 U.S.C.
 2   § 158.
 3                                  ISSUE
 4        Did the bankruptcy court commit reversible error when it
 5   dismissed the Menjivars’ FAC with prejudice and without leave to
 6   amend?
 7                           STANDARDS OF REVIEW
 8        We review de novo a dismissal under Civil Rule 12(b)(6).
 9   See Movsesian v. Victoria Versicherung AG, 670 F.3d 1067, 1071
10   (9th Cir. 2012) (en banc).   When we review a matter de novo, we
11   consider it anew, “as if no decision previously had been
12   rendered, giving no deference to the bankruptcy court's prior
13   determinations.”   Nordeen v. Bank of America, N.A.
14   (In re Nordeen), 495 B.R. 468, 475 (9th Cir. BAP 2013).
15        Generally speaking, we review the bankruptcy court’s
16   decision to dismiss without leave to amend for an abuse of
17   discretion.   See, e.g., Zadrozny v. Bank of N.Y. Mellon,
18   720 F.3d 1163, 1167 (9th Cir. 2013); Reddy v. Litton Indus.,
19   Inc., 912 F.2d 291, 296 (9th Cir. 1990).   It also has been said
20   that appellate courts should “review strictly a . . . court's
21
          8
           The Menjivars effectively consented to the bankruptcy court
22
     entering a final disposition by pursuing their litigation against
23   WFB in the bankruptcy court, with full knowledge of the decision
     in Stern v. Marshall, 131 S.Ct. 2594 (2011), as that decision is
24   cited in the second paragraph of the Menjivars’ FAC. WFB
     similarly consented to the bankruptcy court entering a final
25   disposition. See Res. Funding, Inc. v. Pac. Cont’l Bank
26   (In re Wash. Coast I, L.L.C.), 485 B.R. 393, 407-11, (9th Cir.
     BAP 2012). Alternately, the parties have forfeited any argument
27   challenging the bankruptcy court’s entry of a final disposition
     by not raising the issue either in the bankruptcy court or on
28   appeal. See id.

                                      9
 1   exercise of discretion denying leave to amend.”     Albrecht v.
 2   Lund, 845 F.2d 193, 195 (9th Cir. 1988).
 3         On the other hand, the strictness of this review apparently
 4   diminishes when the plaintiff has amended its complaint, as the
 5   Ninth Circuit has held a number of times that “‘[t]he district
 6   court's discretion to deny leave to amend is particularly broad
 7   where plaintiff has previously amended the complaint.’”     See
 8   Zadrozny, 720 F.3d at 1173 (quoting United States ex rel. Cafasso
 9   v. Gen. Dynamics C4 Sys., Inc., 637 F.3d 1047, 1058 (9th Cir.
10   2011)) (emphasis added).   Accord, Mir v. Fosburg, 646 F.2d 342,
11   347 (9th Cir. 1980).
12         In any event, the Ninth Circuit also has held that
13   “‘[d]ismissal without leave to amend is improper, unless it is
14   clear, upon de novo review, that the complaint could not be saved
15   by any amendment.’”    Intri–Plex Techs., Inc. v. Crest Group,
16   Inc., 499 F.3d 1048, 1056 (9th Cir. 2007).     This is the key
17   standard of review for purposes of our analysis and disposition
18   of the instant appeal.
19         We may affirm on any ground supported by the record.       Diener
20   v. McBeth (In re Diener), 483 B.R. 196, 202 (9th Cir. BAP 2012).
21                                DISCUSSION
22   A.   Overview of Applicable Legal Standards
23         A defendant may obtain dismissal of a complaint under Civil
24   Rule 12(b)(6) if the complaint lacks a cognizable legal theory or
25   lacks sufficient facts to support a cognizable legal theory.       See
26   Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir.
27   1988), partially abrogated on other grounds by, Bell Atl. Corp.
28   v. Twombly, 550 U.S. 544, 562-63 (2007).      The complaint can

                                      10
 1   survive the dismissal motion “only if, taking all well-pleaded
 2   factual allegations as true, it contains enough facts to ‘state a
 3   claim to relief that is plausible on its face.’”    Hebbe v.
 4   Pliler, 627 F.3d 338, 341–42 (9th Cir. 2010) (quoting Ashcroft v.
 5   Iqbal, 556 U.S. 662, 678 (2009), and Twombly, 550 U.S. at 570).
 6        This plausibility standard requires more than the mere
 7   possibility that the defendant is liable to the plaintiff.
 8   Iqbal, 556 U.S. at 678.     “Where a complaint pleads facts that are
 9   merely consistent with a defendant's liability, it stops short of
10   the line between possibility and plausibility of entitlement to
11   relief.”    Id. (quoting Twombly, 550 U.S. at 557) (internal
12   quotation marks omitted).    Formulaic recitations of the elements
13   of a claim for relief are insufficient by themselves to meet the
14   plausibility standard.    Iqbal, 556 U.S. at 678.
15        In reviewing the dismissal, while we must accept as true all
16   well-pleaded facts, we do not need to accept as true conclusory
17   statements, statements of law, and unwarranted inferences cast as
18   factual allegations.   Twombly, 550 U.S. at 555–57; Clegg v. Cult
19   Awareness Network, 18 F.3d 752, 754–55 (9th Cir. 1994).     We also
20   may reject factual allegations contradicted by judicially noticed
21   material.   See Shwarz v. United States, 234 F.3d 428, 435 (9th
22   Cir. 2000).   Indeed, we can use judicially noticed facts and
23   documents to establish that the complaint fails to state a viable
24   claim for relief.   Often, we similarly can use documents attached
25   to or referenced in the complaint.     See Ritchie, 342 F.3d at
26   907–08; Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th
27   Cir. 2001); Durning v. First Boston Corp., 815 F.2d 1265, 1267
28   (9th Cir. 1987).

                                       11
 1        In short, the allegations of the complaint, along with other
 2   materials properly before the court, may demonstrate that the
 3   plaintiff is not entitled to relief as a matter of law.     See
 4   Weisbuch v. County of L.A., 119 F.3d 778, 783 n.1 (9th Cir. 1997)
 5   (“If the pleadings establish facts compelling a decision one way,
 6   that is as good as if depositions and other expensively obtained
 7   evidence on summary judgment establishes the identical facts.”).
 8        The Menjivars dispute whether the bankruptcy court properly
 9   dismissed their FAC with prejudice and without leave to amend.
10   They assert that the bankruptcy court should have explicitly set
11   forth its reasoning explaining why it was not granting leave to
12   amend and that the absence of such explicit reasoning mandates
13   reversal.   We disagree.   The Ninth Circuit expressly rejected
14   this argument in Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d
15   1149, 1160 (9th Cir. 1989), partially abrogated on other grounds
16   by, Leatherman v. Tarrant County Narcotics Intelligence and
17   Coordination Unit, 507 U.S. 163 (1993).      In Ascon Props., even
18   though the trial court there did not state any explicit reasoning
19   in support of its decision to dismiss without leave to amend, the
20   Ninth Circuit held that it still could affirm because adequate
21   and proper grounds for the trial court’s decision were apparent
22   from the entire record.    Id. at 1160-61.
23        When it is apparent from our de novo review that amendment
24   would have been futile, we may affirm the bankruptcy court’s
25   dismissal without leave to amend.      See Intri–Plex Techs., Inc.,
26   499 F.3d at 1056.     Amendment is futile when it is clear that
27   amendment would not have remedied the complaint’s fatal
28   deficiencies.   Id.

                                       12
 1        While the Menjivars stated in their opposition to the
 2   dismissal motion that they desired to amend their FAC in the
 3   event the bankruptcy court determined that their FAC was
 4   deficient, the Menjivars never filed a formal motion to amend
 5   their FAC, never submitted to the court a proposed second amended
 6   complaint,9 and never even indicated in any of their papers how
 7   they would amend the FAC to overcome any deficiencies.     The
 8   Menjivars assert on appeal that there is no rule requiring them
 9   to offer a proposed amended complaint in advance of dismissal and
10   that their failure to indicate how they would amend the complaint
11   is not grounds, by itself, for dismissal without leave to amend.
12   This much is true.   But the Menjivars overlook the real
13   significance of the absence of proposed amendments.   Whereas the
14   Menjivars were entitled to propose amendments inconsistent with
15   their existing allegations, see PAE Gov’t Servs., Inc. v. MPRI,
16   Inc., 514 F.3d 856, 859-60 (9th Cir. 2007), in deciding whether
17   amendment was futile, the bankruptcy court and this Panel only
18   are required to take into account hypothetical amended pleadings
19   containing facts consistent with those already alleged.    See
20   Swartz v. KPMG LLP, 476 F.3d 756, 761 (9th Cir. 2007) (citing
21   Albrecht, 845 F .2d at 195, and holding that dismissal without
22   leave to amend is proper when “allegation of other facts
23   consistent with the challenged pleading could not possibly cure
24   the deficiency”) (emphasis added); Schreiber Distrib. Co. v.
25
26        9
           If the Menjivars had filed a motion to amend, the
27   bankruptcy court’s local rules would have required the Menjivars
     to submit the proposed amended pleading in conjunction with that
28   motion. See Bankr. C.D. Cal. R. 7016-1(a)(1).

                                     13
 1   Serv–Well Furniture Co., Inc., 806 F.2d 1393, 1401 (9th Cir.
 2   1986) (same); see also Knox v. Davis, 260 F.3d 1009, 1013 (9th
 3   Cir. 2001) (in ruling on Civil Rule 12(b)(6) motion, court may
 4   rely on concessions made by plaintiff); Weisbuch, 119 F.3d at 781
 5   (same).
 6   B.   California Fraudulent Transfer Claims
 7         With this legal framework in mind, we turn our attention to
 8   the Menjivars’ claims for relief.      Most of the Menjivars’ claims
 9   explicitly rely on California’s version of the Uniform
10   Fraudulent Transfer Act (“UFTA”), Cal. Civ. Code. §§ 3439, et
11   seq., or implicitly rely on the UFTA by referencing the
12   Menjivars’ fraudulent transfer allegations.
13         The principal ground for dismissal of the Menjivars’ UFTA
14   claims was HOLA preemption.   See Silvas v. E*Trade Mortg. Corp.,
15   514 F.3d 1001, (9th Cir. 2008).    Silvas held that, pursuant to
16   12 C.F.R. § 560.2, claims for relief based on Cal. Bus. and Prof.
17   Code §§ 17200 and 17500 were preempted as applied by the
18   plaintiffs therein “because [their] state law claims provide
19   state remedies for violations of federal law in a field preempted
20   entirely by federal law.”   In conducting its HOLA preemption
21   analysis, Silvas focused on the specific factual allegations
22   contained in the complaint and whether these allegations
23   referenced activities and conduct subject to the exclusive
24   regulation of the Office of Thrift Supervision (“OTS”), as
25   specified in 12 C.F.R. § 560.2(b).     Because all of the specific
26   misconduct alleged fell within the ambit of 12 C.F.R. § 560.2(b),
27   Silvas concluded that the California statutes at issue were
28   preempted as applied there by the plaintiffs.

                                       14
 1        Here, the specific factual allegations underlying the
 2   Menjivars’ UFTA claims are that World Savings Bank10
 3   misrepresented the terms of the 2007 loans, overcharged for
 4   settlement fees, and ultimately extended credit to the Menjivars
 5   under terms that the Menjivars considered unfavorable and
 6   incapable of helping them meet their personal financial goals.
 7   These allegations deal with conduct and activities exclusively
 8   regulated by the OTS.   See 12 CFR § 560.2(b)(4), (5) and (9).11
 9
10        10
           WFB’s judicial notice request contains documents
11   identifying World Savings Bank as a federal savings bank that was
     subject to OTS oversight at the time of the 2007 refinancing
12   transactions.
          11
13         The above-referenced subparagraphs of 12 CFR § 560.2(b)
     provide for field preemption of:
14
15        (b) . . . state laws purporting to impose requirements
          regarding:
16
          *    *   *
17
          (4) The terms of credit, including amortization of
18        loans and the deferral and capitalization of interest
19        and adjustments to the interest rate, balance, payments
          due, or term to maturity of the loan, including the
20        circumstances under which a loan may be called due and
          payable upon the passage of time or a specified event
21        external to the loan;
22
          (5) Loan-related fees, including without limitation,
23        initial charges, late charges, prepayment penalties,
          servicing fees, and overlimit fees;
24
          *    *   *
25
26        (9) Disclosure and advertising, including laws
          requiring specific statements, information, or other
27        content to be included in credit application forms,
          credit solicitations, billing statements, credit
28                                                       (continued...)

                                     15
 1   Accordingly, based on Silvas and 12 CFR § 560.2(b), the
 2   bankruptcy court here correctly concluded that the Menjivars’
 3   UFTA claims should be dismissed based on HOLA preemption.      Nor
 4   were there any amendments consistent with the Menjivars’ existing
 5   allegations that would have saved their UFTA claims from
 6   preemption.    Thus, dismissal without leave to amend was
 7   appropriate.
 8        As a separate and independent ground for affirmance, we note
 9   that the Menjivars’ actual fraudulent transfer allegations are
10   fatally inconsistent with the UFTA, which requires the plaintiff
11   to plead and prove that the transferor actually intended to
12   hinder, delay or defraud his creditors.   That the focus is on the
13   transferor’s intent is plain on the face of the statute.       See
14   Cal. Civ. Code § 3934.04(a)(1).    This has been the rule in
15   California for a long time, well before California enacted the
16   UFTA:12   "It is well settled that it is the motive of the
17   grantor, and not the knowledge of the grantee, that determines
18   the validity of the transfer."    Bush & Mallett Co. v. Helbing,
19   134 Cal. 676, 679 (1901).   Here, the Menjivars have not alleged
20   that they as the transferors of the 2007 notes and trust deeds
21   entered into the 2007 refinancing transactions with the intent to
22   hinder, delay or defraud their creditors.    Instead, they in
23   essence alleged that World Savings Bank duped them into entering
24
          11
           (...continued)
25        contracts, or other credit-related documents and laws
26        requiring creditors to supply copies of credit reports
          to borrowers or applicants[.]
27
          12
           California enacted the UFTA in 1986.    See Mejia v. Reed,
28   31 Cal.4th 657, 664 (Cal. 2003).

                                       16
 1   into refinancing transactions that were not in their financial
 2   best interests.   No amendments consistent with these existing
 3   allegations were going to meet the requirement to allege
 4   intentional misconduct by the Menjivars, which would be necessary
 5   to state a viable claim to invalidate the 2007 notes and trust
 6   deeds as actual fraudulent transfers.
 7        Similarly, the Menjivars’ constructive fraudulent transfer
 8   allegations are fatally inconsistent with the UFTA, which
 9   requires an absence of reasonably equivalent value.     See Cal.
10   Civ. Code §§ 3439.04(a)(1)(2), 3439.05.      Reasonably equivalent
11   value under the UFTA is measured objectively, from the
12   perspective of the transferor’s creditors.     See Decker v. Tramiel
13   (In re JTS Corp.), 617 F.3d 1102, 1109 (9th Cir. 2010); Maddox v.
14   Robertson (In re Prejean), 994 F.2d 706, 708 (9th Cir. 1993).
15   This focus on the creditors’ perspective is consistent with the
16   underlying purpose of the UFTA, which seeks to protect the
17   creditors from “transfers that impede them in the collection of
18   their claims.”    Mejia 31 Cal.4th at 664.    Here, the Menjivars’
19   specific factual allegations admit that, in July 2007, the
20   Menjivars executed a note for roughly $550,000 in order to payoff
21   the $539,000 note they executed in January 2007.     In turn, the
22   Menjivars executed the January 2007 note in exchange for $13,000
23   in cash and the payoff of their October 2005 note in the amount
24   of $516,000.   All three notes were secured by the Menjivars’
25   residence.
26        The FAC’s allegations make clear that, from the Menjivars’
27   subjective viewpoint, the 2007 refinancing transactions did not
28   meet their personal, subjective financial needs and goals.     But

                                      17
 1   for purposes of the UFTA, when we consider the transactions as we
 2   must from the creditors’ objective viewpoint, it simply is not
 3   plausible that the satisfaction of antecedent debt accomplished
 4   by the 2007 refinancing transactions did not constitute
 5   reasonably equivalent value.    As a matter of law, a note and
 6   trust deed given on account of antecedent debt does not qualify
 7   as a constructive fraudulent transfer.   See In re Prejean,
 8   994 F.2d at 709.   Nor would any amendment of the FAC consistent
 9   with its existing allegations cure this deficiency.
10         In sum, the bankuptcy court did not err by dismissing the
11   Menjivars’ UFTA claims without leave to amend.
12   C.   Claims Based on Fraud and Lack of Consideration
13         In a single claim for relief, the Menjivars state both fraud
14   and lack of consideration as grounds to invalidate the 2007 notes
15   and trust deeds.
16         The Menjivars lack of consideration contention is based on a
17   false premise: that the agreed-upon satisfaction of their
18   antecedent debts was invalid or insufficient consideration to
19   bind them to the terms of 2007 notes and trust deeds.   To the
20   contrary, the satisfaction of their antecedent debt conferred a
21   substantial and valid legal benefit on the Menjivars, a benefit
22   that they were not otherwise entitled to but for the 2007
23   refinancing transactions.   Thus, the 2007 notes and trust deeds
24   were supported by sufficient and valid consideration.   See Cal.
25   Civ. Code § 1605; Raedeke v. Gibraltar Sav. & Loan Assn.,
26   10 Cal.3d 665, 673-74 (1974).
27         As for their fraud contentions, they are barred by
28   California’s three-year statute of limitations on fraud claims.

                                      18
 1   See Cal. Civ. Proc. Code § 338(d).    The limitations period began
 2   to run when the Menjivars entered into the 2007 refinancing
 3   transactions, and they did not commence the current litigation
 4   until more than three years had elapsed thereafter.
 5        The Menjivars made only one argument in their opening appeal
 6   brief regarding the fraud statute of limitations.   They claim
 7   that their fraud contentions are governed by California’s
 8   four-year limitations period covering claims based on contract,
 9   see Cal. Civ. Code § 337(1), and not based on California’s
10   three-year limitations period covering claims based on fraud.
11   See Cal. Civ. Code § 338(d).    This claim is specious.   The
12   Menjivars’ allegations that they were fraudulently induced to
13   execute the 2007 notes and trust deeds sound in fraud and not in
14   contract.   Under similar circumstances, the Ninth Circuit did not
15   hesitate to apply a three-year limitations period applicable to
16   fraud claims.    See Zadrozny, 720 F.3d at 1173; see also Rosenfeld
17   v. JPMorgan Chase Bank, N.A., 732 F.Supp.2d 952, 971 (N.D. Cal.
18   2010) (same).
19        For the first time in their reply brief, the Menjivars argue
20   that the fraud statute of limitations did not begin to run until
21   they were presented with sufficient facts from which a reasonable
22   person would have been suspicious that some sort of wrong had
23   been committed.   See Norgart v. Upjohn Co., 21 Cal.4th 383,
24   397-98 (1999).    The Menjivars forfeited this argument by not
25   raising it either in the bankruptcy court or in their opening
26   appeal brief.    See Zadrozny, 720 F.3d at 1173.
27        Even if we were to consider this argument, the July 2007
28   loan terms the Menjivars now complain of are clear on the face of

                                      19
 1   the July 2007 loan documents the Menjivars signed.     Accordingly,
 2   California’s discovery rule would not have delayed the
 3   commencement of the limitations period, as the Menjivars had
 4   sufficient information from the outset regarding the true terms
 5   of the July 2007 refinancing transaction.     See id. (alleged
 6   problems with loan transaction evident on the face of loan
 7   documents, so fraud limitations period not tolled);     Rosenfeld,
 8   732 F.Supp.2d at 970-71 (same).
 9         The defects associated with the Menjivars’ fraud and lack of
10   consideration allegations are not the type the Menjivars could
11   have cured with amendments consistent with their existing
12   allegations.   Thus, the bankruptcy court properly dismissed these
13   claims without leave to amend.
14   D.   Claims Based on TILA, FHA and ECOA.
15         The Menjivars had up to three years to demand rescission of
16   the 2007 refinancing transactions based on alleged TILA
17   violations.    15 U.S.C. § 1635(f).    Meanwhile, most TILA damages
18   claims need to be filed within one year, but a handful of TILA
19   violations will support a damages claim for up to three years.
20   See 15 U.S.C. § 1640(e).    As for the alleged violations of the
21   FHA and the ECOA, the Menjivars only had two years from the
22   occurrence of the alleged violations to bring suit.     See
23   42 U.S.C. § 3613(a)(1)(A); 15 U.S.C. § 1691e(f).13     Because the
24
25         13
           In 2010, Congress enlarged the ECOA limitations period
26   from two years to five years. See Cottrell v. Vilsack,
     915 F.Supp.2d 81, 90 & n.7 (D. D.C. 2013). But the ECOA
27   limitations period in effect at the time of the 2007 refinancing
     transactions was two years, and the time for the Menjivars to
28                                                      (continued...)

                                       20
 1   Menjivars did not commence their litigation against WFB, and did
 2   not demand rescission of the 2007 refinancing transactions, until
 3   after all of these limitations periods had expired, their TILA,
 4   FHA and ECOA claims are time-barred.
 5        The Menjivars argue for the first time in their appeal reply
 6   brief that one or more of these limitations periods did not run
 7   because they did not discover sufficient facts regarding World
 8   Savings Bank’s TILA, FHA and ECOA violations until sometime in
 9   2010, well after the 2007 refinancing transactions were
10   consummated.
11        We reject this argument as to the Menjivars’ TILA claims for
12   the same reasons we rejected the Menjivars’ similar argument
13   regarding their discovery of the facts underlying their fraud
14   claim.    First, the Menjivars forfeited these arguments by not
15   asserting them in the bankruptcy court or in their opening appeal
16   brief.    And second, the facts alleged in the FAC and the contents
17   of the July 2007 loan documents demonstrate that the Menjivars
18   had sufficient information from the outset regarding the true
19   terms of the July 2007 refinancing transaction so as to fatally
20   undermine their discovery argument.    Cf. Meyer v. Ameriquest
21   Mortg. Co., 342 F.3d 899, 902 (9th Cir. 2003) (borrowers had all
22   the information they needed to discover their TILA claim at the
23
          13
24         (...continued)
     file their ECOA claim expired in 2009, before the ECOA
25   limitations period was amended. The new larger limitations
26   period cannot be applied to the Menjivars’ ECOA claim because
     that claim already was time barred before the 2010 amendment of
27   the ECOA was enacted. See Chenault v. U.S. Postal Serv., 37 F.3d
     535, 539 (9th Cir. 1994), cited with approval in, Hughes Aircraft
28   Co. v. United States ex rel. Schumer, 520 U.S. 939, 950 (1997).

                                      21
 1   time the loan was consummated, so TILA limitations period was not
 2   tolled); Rosenfeld, 732 F.Supp.2d at 964 (same); Rosal v. First
 3   Fed. Bank of Cal., 671 F.Supp.2d 1111, 1122-24 (N.D. Cal. 2009)
 4   (same).
 5         As for the Menjivars’ FHA and ECOA claims, once again, the
 6   Menjivars did not timely offer any argument countering WFB’s
 7   contention that these claims were time-barred, and thus they have
 8   forfeited any such argument.   Moreover, the discovery rule simply
 9   does not apply to these claims.    See Garcia v. Brockway,
10   526 F.3d 456, 465 (9th Cir. 2008) (en banc); Thiel v. Veneman,
11   859 F.Supp.2d 1182, 1199 (D. Mont. 2012); see also Grimes v.
12   Fremont Gen. Corp., 785 F.Supp.2d 269, 291-94 (S.D.N.Y. 2011).
13         Because no amendments consistent with the Menjivars’
14   existing allegations would have cured the limitations defects in
15   their TILA, FHA and ECOA claims, the bankruptcy court properly
16   dismissed these claims without leave to amend.
17   E.   Other Claims
18         The FAC sets forth several so-called claims for relief that
19   in reality are remedies or are entirely derivative of their
20   other, substantive claims.   Because we have determined that none
21   of their substantive claims are viable, none of their derivative
22   claims or remedies-based claims are viable either.14
23
           14
24         The Menjivars’ fourteenth claim for relief, seeking to
     disallow as untimely WFB’s proof of claim filed in Mr. Menjivar’s
25   latest chapter 13 bankruptcy case is derivative because it
26   assumes that WFB’s claim is unsecured based on the allegations
     contained in the Menjivars’ other claims for relief. In any
27   event, Rule 3002(c)(3) gives a secured creditor whose security
     interest is avoided by a judgment of the bankruptcy court an
28                                                      (continued...)

                                       22
 1                              CONCLUSION
 2        For the reasons set forth above, we AFFIRM the bankruptcy
 3   court’s order dismissing the FAC without leave to amend.
 4
 5
 6
 7
 8
 9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25        14
           (...continued)
26   extended deadline to file a proof of claim, until thirty days
     after all appeals from the subject judgment have been exhausted.
27   Since no judgment has been entered against WFB avoiding its July
     2007 trust deed, the deadline for WFB to file a proof of claim
28   has not run.

                                    23
