1.DEFENDANTS BANK OF AMERICA N.A., BANK OF AMERICA CORPORATION; COUNTRYWIDE FINANCIAL CORPORATION; COUNTRYWIDE HOME LOANS INC; RECONTRUST COMPANY N.A.; CTC REAL ESTATE SERVICES AND LANDSAFE INC. DEMURRER TO FIFTH AMENDED COMPLAINT

2.PLAINTIFF MARTHA DIAZ AND FADI DIAZ MOTION TO VACATE DISMISSAL

3.PLAINTIFF YOLANDA SOLORIO MOTION TO VACATE DISMISSAL

Yolanda Solario?s, Martha Diaz? and Fadi Diaz? requests to vacate are?granted.

Defendants?s Request for Judicial Notice is granted as to Exhibits 3-26.? The request is superfluous as to Exhibits 1, 2 and 27?all of which are documents on file in this case?and may be considered by the Court without a request.

Defendants? demurrer on the ground of misjoinder is?overruled.

Defendants? demurrers on ground of lack of standing are?sustained?with leave to amend?as to Plaintiffs Coye Decuir, Martha Diaz, Raivie Galura, Ruffel Galura, Michael Gauthier and Barbara Gauthier.? Those Plaintiffs may amend their claims, by filing an ?Appendix to the Fifth Amended Complaint? within twenty days.? Each appendix should be identified by the individual plaintiff?s name.? For example, if Martha Diaz elects to amend by appendix, she should file a document entitled ?Martha Diaz? Appendix to the Fifth Amended Complaint.?? Defendants? demurrers on the ground of lack of standing are?overruled?as to Plaintiffs Alfred Ayala, Jose Guitron and Margaret Velez.

Defendants? demurrers on statute of limitations grounds are?overruled.?

Defendants? demurrers to the 1st and 2nd causes of action (fraud not plead with sufficient specificity) are?overruled.?

Defendants’ demurrer to the 3rd cause of action for violation of the UCL is?overruled.

Defendants? demurrer to the 4th cause of action for Wrongful Foreclosure is?overruled.

Misjoinder.? Defendants first argue that the Plaintiffs have been misjoined.? In its ruling in this matter, the Appellate Court ?identified the two core aspects of the common plan alleged in the third amended complaint that ?necessarily will entail common evidence (1) whether Countywide deliberately encouraged dishonest appraisals and (2) whether Countrywide encouraged its loan officers to conceal loan terms.???Opinion at pp.15-16.? Those two ?core aspects? are alleged in the Fifth Amended Complaint?and, so, the joinder is proper.??Defendants?argue, however,?that there is misjoinder because the Appellate Court?s opinion required a pleading which organizes the case ?appropriate and manageable?subclaims?and?subclasses.?? The opinion did not require such a pleading.? Rather, it states: ?we emphasize that on remand the?trial court?will have to consider a variety of procedural tools with which to organize this case into appropriate and manageable?subclaims?and?subclasses.?[Citation]?While the irony of requiring the case to be divided into tranches has not escaped as [sic], we are confident the?trial court?can handle the task.?? [Emphasis added.]? The appellate court placed the burden of organizing the case into practical bites squarely on this Court and not on the pleading.

Lack of Standing.? Defendants next argue that certain Plaintiffs lack standing because they failed to identify these claims as assets in?Chapter 7 bankruptcies.? Once a bankruptcy petition has been filed, only the trustee has standing to prosecute causes of action belonging to the estate.??M & M Foods, Inc. v. Pacific American Fish Co., Inc.(2011) 196 Cal.App.4th 554, 562.? Once a bankruptcy has been closed, a Chapter 7 debtor cannot pursue any cause of action or claim which was not listed on the bankruptcy schedules.??See In re JZ L.L.C.(9th Cr. BAP 2007) 371 B.R. 412, 418 (noting that after chapter 7 bankruptcy case closes, nobody controls unscheduled property; the debtor lacks standing).

According to the allegations of the complaint and the bankruptcy filings submitted pursuant to the Request for Judicial Notice, the?following Plaintiffs do not have standing to pursue the claims alleged?in this action because they were aware of the claims at the time they filed bankruptcy, they did not include those claims as assets in the bankruptcy and the bankruptcies have been closed:??Coye Decuir, Martha Diaz, Ravie Galura, Ruffel Galura, Michael Gauthier and Barbara Gauthier.? However, Defendants??demurrer on the grounds of lack of standing fails as to three of the Plaintiffs identified in the demurrer:? Alfred Ayala, Jose Guitron and Margaret Velez.? As for Mr.?Ayala and Ms. Velez, the allegations of the complaint do not identify a specific date for alleged discovery of the claims (see?? 76,?Appendix?B and ? 115, Appendix A).? With regard to Mr.?Guitron,?the allegations of the complaint assert that he first discovered the claim on 3/9/12 (? 51, Appendix B)?almost two years after he filed for bankruptcy.

Statutes of Limitation.? Defendants demur to the claims of Plaintiffs?Barrera, Casas, Cervantes, Dandamudi, De La Cruz, Hernandez, Koohpareh, Marino, Marouf, Martinez, Nava, Padilla, Shreckengost, Springer, Summers, Velasco and Wright and the Bankruptcy Plaintiffs?(identified above) on the ground that they are barred by the 3-year statute of limitations for fraud.? All the plaintiffs allege that the fraudulent conduct occurred between 2005 and 2007?more than three years before the action was filed in February 2011 and none plead facts establishing a tolling.

The statute of limitations on a fraud claim runs from the date the fraud was or should have been discovered.? CCP ? 338(d) (an action for relief on the ground of fraud or mistake ?is not deemed to have accrued until the discovery, by the aggrieved party, of the facts constituting the fraud or mistake.?);?Cleveland v. Internet Specialties West, Inc.?(2009) 171 Cal.App.4th 24, 31 (?the statute of limitations in a cause of action for fraud ?commences to run after one has knowledge of facts sufficient to make a reasonably prudent person suspicious of fraud, thus putting him on inquiry….??).??See also Fox v. Ethicon Endo-Surgery, Inc.?(2005) 35 Cal.4th 797, 808 (?under the delayed discovery rule, a cause of action accrues and the statute of limitations begins to run when the plaintiff has reason to suspect an injury and some wrongful cause …?).

Negligent misrepresentation claims are typically subject to a two-year statute of limitations unless the gravamen of the claim is fraud in which case they are subject to a three-year statute of limitations.??E-Fab, Inc. v. Accountants, Inc. Services?(2007) 153 Cal.App.4th 1308, 1316. The UCL claim is governed by a 4-year statute of limitations.? Bus. & Prof. Code ? 17208.

In order to rely on the discovery rule for delayed accrual of a cause of action, a plaintiff must specifically plead facts to show (1) the time and manner of discovery and (2) the inability to have made earlier discovery despite reasonable diligence. In determining the sufficiency of the allegations of delayed discovery, the court places the burden on the plaintiff to show diligence.??Fox, 35 Cal.4th at 808-809.? Here, each of the identified Plaintiffs alleges that he/she did not discover the wrongdoing until they met with counsel and thoroughly investigated their loan documents.? Although Plaintiffs do not specifically allege why they could not make the discovery earlier, it can reasonably be inferred from their allegations that they could not discover the claims earlier due to their inexperience and the complexity of the loans so that legal assistance was necessary.

1st and 2nd causes of action (based on lack of specificity of fraud claims).??Defendants argue that the fraud claims are not pled with the requisite specificity. ??In California, fraud must be pled specifically; general and conclusory allegations do not suffice. Thus the policy of liberal construction of the pleadings … will not ordinarily be invoked to sustain a pleading defective in any material respect.? This particularity requirement necessitates pleading facts which show how, when, where, to whom, and by what means the representations were tendered.”?Lazar v. Superior Court?(1996) 12 Cal. 4th 631, 645 (citations and internal quotation marks omitted).? However, the rule requiring specificity is ?relaxed when it is apparent from the allegations that the defendant necessarily possesses knowledge of the facts.???Quelimane Co., Inc. v. Stewart Title Guar. Co.?(1998) 19 Cal.4th 26, 47, citing?Committee on Children?s Television, Inc. v. General Foods Corp.?(1983) 35 Cal. 3d 197, 217.?? Under these allegations, Defendants would necessarily have knowledge of the facts.? Further, Defendants make this argument generally and generically and do not provide citations to the allegedly defective pleadings of the individual Plaintiffs.? Therefore, they do not meet their burden on demurrer.

Defendants argue (again, generically) that certain of the allegedly fraudulent statements are not actionable.? A demurrer presents an issue of law regarding the sufficiency of the allegations set forth in the complaint.??Lambert v. Carneghi?(2008) 158 Cal.App.4th 1120, 1126.? The complaint is read as a whole: material facts properly pleaded are assumed true; contentions, deductions or conclusions of fact/law are not.??Blank v. Kirwan?(1985) 39 Cal.3d 311, 318.? In general, a pleading is adequate if it contains a reasonably precise statement of the ultimate facts, in ordinary and concise language, and with sufficient detail to acquaint a defendant with the nature, source and extent of the claim.? ?If the complaint states a cause of action under any theory, regardless of the title under which the factual basis for relief is stated, that aspect of the complaint is good against a demurrer. [W]e are not limited to plaintiffs’ theory of recovery in testing the sufficiency of their complaint against a demurrer, but instead must determine if the factual allegations of the complaint are adequate to state a cause of action under any legal theory. The courts of this state have… long since departed from holding a plaintiff strictly to the `form of action’ he has pleaded and instead have adopted the more flexible approach of examining the facts alleged to determine if a demurrer should be sustained.”??Quelimane v. Stewart Title Guaranty Co.?(1998) 19 Cal.4th 26, 38. The question on demurrer is whether the allegations, as a whole, state a cause of action.? Because Defendants do not meet their burden (they argue generically and do not provide any citation to where the alleged deficiencies can be found) and because the argument addresses specific allegations and not the claim as a whole, the demurrer cannot succeed.

Defendants argue that Plaintiffs? allegations of damaged credit and decreased property values cannot support a claim of fraud.? Even if Defendants? argument is correct, Plaintiffs? claimed damages are not limited to decreased property values and bad credit.? Plaintiffs also claim they were damaged by the ?additional fees, points and interests paid as a result of the higher/inflated loan amounts? (? 101) and being required to ?pay a substantially higher price for their home than they would have otherwise and much more than their home was truly worth at the time,? including payment of increased principal and interest (? 110).? Defendants do not make any argument concerning those additional claimed damages.

Defendants argue that Plaintiffs Barrera, Casa, Cervantes, Dandamudi, Decuir, Gauthier, Marinov, Marouf, Martinez, Nava, Padilla, Springer, Summers, Velasco and Wright claim that Countrywide misrepresented they could obtain loan modifications but fail to specify who told them they would qualify for a modification or provide any other details regarding the alleged misrepresentations.? Defendants do not provide citations to support this argument as to each of the identified Plaintiffs.? Further, the loan modification claim is only part of Plaintiffs? causes of action.? A demurrer does not address individual allegations but, rather, the entire claim.

3rd Cause of Action for Violation of UCL.? Defendants argue that the UCL claims fail because it is based on failed fraud claims.? However, as set forth above, Defendants? demurrer to the fraud claims is not successful.? In addition, Defendants argue that Plaintiffs do not seek restitution or allege injunctive relief and invoke inapplicable statutes.? As set forth above, Plaintiffs claim payment of additional principal, interest and fees based on allegedly fraudulently inflated appraisals.? Such claimed damages could support an award of restitution.? Defendants also allege that the UCL claims fail because certain of the statutes identified by Plaintiffs in their complaint cannot support a UCL claim.? Again, a demurrer addresses the entire cause of action and not individual allegations.? As the identified statutes are only part of the UCL cause of action, even if Defendants? arguments are correct, the demurrer cannot be sustained on those grounds.

4th Cause of Action for Wrongful Foreclosure. Defendants claim that the wrongful foreclosure claim has been abandoned because none of the wrongful foreclosure plaintiffs remain active in the case.? Defendants fail to identify the alleged wrongful foreclosure plaintiffs and do not indicate where those plaintiffs are identified in the Fifth Amended Complaint.? The Court?s review of the Complaint on this point revealed that the ?wrongful foreclosure plaintiffs? were to be ?fully listed after discovery.?? Footnote 7 (page 15), Footnote 15 (p. 129) and Footnote 16 (p. 145).? Because the wrongful foreclosure plaintiffs have not yet been identified and Defendants did not present evidence that none of the Plaintiffs remaining in this action were subject to foreclosure, the demurrer cannot be sustained on this ground.

Those Bankruptcy Plaintiffs who have been granted leave to amend shall do so by amending allegations in the Appendix pertaining to each of them. The Amended Appendices shall be deemed to be part of the 5th?Amended Complaint. To ensure that the filings of the amended appendices are not rejected by the court at the “filing window”, plaintiffs must indicate that they are filing the Amended Appendices as part of the 5th?Amended Complaint in this matter pursuant to this Court’s order.