Min v. Selene Finance, LP

Background

Cho Ung Min, through counsel, applied for a temporary restraining order under Federal Rule of Civil Procedure 65. The application sought to prevent a trustee’s sale of the property at 7229 Shannon Park Court, South San Francisco, California, which was scheduled for December 27, 2023. Min notified Selene Finance, LP and Rushmore Loan Management, LLC of his intent to seek emergency relief. The court ordered the defendants to respond before a December 20 hearing, but neither defendant responded or appeared through counsel.

Court’s Analysis

A temporary restraining order uses the same standard as a preliminary injunction. The plaintiff must show a likelihood of success on the merits, a likelihood of irreparable harm without an injunction, that the balance of hardships favors the plaintiff, and that an injunction serves the public interest. The court also noted that serious questions on the merits may support an injunction when the other requirements are met.

The court found that the possible foreclosure of Min’s home created a high likelihood of irreparable harm. It also found serious questions concerning several claims, including whether the defendants failed to provide a single point of contact for foreclosure-prevention efforts in violation of California Civil Code section 2923.7; whether Rushmore failed to advise Min properly about options after COVID-19-related loan forbearance, in violation of section 3273.11; whether the defendants breached the implied promise of good faith and fair dealing; whether Min detrimentally relied on representations about his loan status; whether Selene Finance failed to follow a foreclosure alternative presented by Rushmore, in violation of section 2924.11(g); and whether both defendants violated California’s Unfair Competition Law by violating those statutes.

The court concluded that these serious questions and the risk of foreclosure shifted the balance toward Min. It also found that the public interest favored temporarily preventing a potentially wrongful foreclosure.

Order and Effect

The court granted the ex parte application for a temporary restraining order. Pending the preliminary-injunction hearing and further court order, Selene Finance, Rushmore Loan Management, their employees, agents, and other persons or entities acting with or for them were restrained and enjoined from conducting the trustee’s sale of the property.

The court also issued an order requiring the defendants to appear by Zoom on February 28, 2024, to show cause why a preliminary injunction should not issue. Min could file a revised preliminary-injunction motion by January 24, 2024; the defendants could oppose by February 7; and Min could reply by February 14. The order required service on the defendants by December 22 and proof of service by December 29. The case was also referred to early mediation through the court’s alternative-dispute-resolution program.

The order addressed temporary emergency relief and whether a preliminary injunction should be considered; it did not finally decide the underlying claims.