Chamberlain v. Specialized Loan Servicing, LLC

Background

William Chamberlain filed an emergency, one-sided request for a temporary restraining order under Federal Rule of Civil Procedure 65. He asked the court to stop a foreclosure sale of the property at 2201 Melvin Road, Oakland, California 94602, scheduled for June 14, 2021. Chamberlain acknowledged that Specialized Loan Servicing, LLC (SLS) was the current servicer of the loan for the property.

Chamberlain asserted five claims against SLS. The first four alleged violations of the Real Estate Settlement Procedures Act (RESPA), based on allegations that SLS failed to provide accurate loss-mitigation options and failed to respond in writing to appeals of loan-modification decisions. The fifth claim alleged a related violation of California’s Unfair Competition Law.

Legal standard

The court explained that the standard for a temporary restraining order is substantially the same as the standard for a preliminary injunction. A plaintiff seeking this extraordinary relief must make a threshold showing that he is likely to succeed on the merits, likely to suffer harm that cannot be repaired without immediate relief, that the balance of hardships favors him, and that an injunction would serve the public interest. In some circumstances, a strong showing on the merits can support relief when the hardship balance sharply favors the plaintiff, but the plaintiff must still show likely irreparable harm and that the relief serves the public interest.

Court’s analysis

SLS argued that the RESPA provisions Chamberlain relied on did not apply to his loan. The court noted that the cited RESPA regulations apply to certain federally related mortgage loans but exclude open-end lines of credit, including home equity plans. Chamberlain’s complaint specifically described his loan as a home equity line of credit, and his declaration likewise stated that he had obtained a home equity line of credit.

The court took judicial notice of two deeds of trust because they were public records and were not generally subject to dispute. The court also found that the documents could be considered because they formed the basis of Chamberlain’s claims. One deed of trust, recorded in Alameda County on November 23, 2005, referred to a revolving credit agreement secured by the property, confirming SLS’s argument that the loan was an open-end home equity line of credit.

Based on Chamberlain’s own allegations and the documents properly considered by the court, the court found that he had not made a clear showing that the loan was covered by the RESPA provisions underlying his federal claims and related state-law claim. The court therefore found that he had not shown a likelihood of success on the merits or raised serious questions about the merits. Because that showing was missing, the court did not analyze the other requirements for a temporary restraining order.

Disposition

Judge Haywood S. Gilliam, Jr. denied Chamberlain’s ex parte application for a temporary restraining order. The order addressed only the request for temporary emergency relief; the opinion text does not state a final disposition of the underlying claims.