Nowaid v. American Capital Group, LLC

Background

Ali Nowaid and Breeze Capital Group LLC sought a temporary restraining order, an emergency order temporarily preserving the situation, against a foreclosure sale scheduled for July 17, 2025. The property is located at 1183 Central Blvd., Hayward, California.

According to Plaintiffs’ allegations, Nowaid obtained a loan from American Capital Group, LLC in August 2022 and executed a deed of trust in the lender’s favor. The loan was scheduled to mature on October 1, 2024. Before maturity, Nowaid allegedly obtained replacement financing through CV3 Financial Services, but American Capital Group allegedly obstructed his attempts to obtain a payoff demand. The alleged obstruction caused CV3’s letter of intent to expire.

Nowaid allegedly made several further attempts to obtain a payoff demand. American Capital Group eventually provided one on December 7, 2024, after the loan’s maturity date, seeking an allegedly inflated amount of $880,374. A notice of default was recorded on March 12, 2025, followed by a notice of trustee’s sale on June 17, 2025, seeking more than $981,000 through foreclosure.

Court’s analysis

The court concluded that Plaintiffs’ allegations raised serious questions about the merits because they alleged that American Capital Group interfered with Nowaid’s ability to obtain replacement financing and pay off the loan. The court noted that American Capital Group presented no evidence contesting that characterization in its opposition brief.

American Capital Group primarily argued that Plaintiffs lacked standing—the legal ability to seek the requested court order—because they were not the property’s current owners. County records showed that Nowaid deeded the property to Pine Country, LLC on February 27, 2024. Plaintiffs submitted evidence that the property was transferred back to Breeze Capital by quitclaim deed on August 11, 2024. The court found that this evidence was sufficient, at this stage, to establish Breeze Capital’s likely ownership.

The court also found likely irreparable harm, meaning harm that cannot be adequately repaired later with money. It reasoned that real property is considered unique and that losing it through foreclosure is generally sufficient to constitute irreparable harm. The equities favored Plaintiffs because reversing a foreclosure sale could create a difficult logistical problem if Plaintiffs ultimately prevailed, while American Capital Group could still foreclose later if it prevailed.

The court granted American Capital Group’s request for judicial notice of the county records because they were matters of public record.

Ruling and next steps

Judge Rita F. Lin granted Plaintiffs’ motion for a temporary restraining order and enjoined American Capital Group from conducting the trustee’s sale. The order remains in effect until July 30, 2025, at 5:00 p.m.

The court ordered American Capital Group to appear in person at a July 30, 2025 hearing at 1:30 p.m. and show cause why a preliminary injunction should not issue. American Capital Group’s opposition brief was due July 21, 2025, and Plaintiffs’ reply was due July 24, 2025. The order did not finally resolve the underlying dispute over the loan, payoff demand, or foreclosure.