21SMCV01658

Assigned for all purposes to: Santa Monica Courthouse, Judicial Officer: Mark Epstein
Electronically FILED by Superior Court of California, County of Los Angeles on 10/15/2021 10:14 AM Sherri R. Carter, Executive Officer/Clerk of Court, by M. Mohammadi,Deputy Clerk

Sarah Shapero (Bar No. 281748)

1 SHAPERO LAW FIRM
2 100 Pine St., Ste. 530
San Francisco, CA 94111
3 Telephone: (415) 273-3504
Facsimile: (415) 358-4116
4
Attorney for Plaintiff,
5 GUY HART
6

7
SUPERIOR COURT OF THE STATE OF CALIFORNIA
8
COUNTY OF LOS ANGELES
9

10
GUY HART, an individual, Case No.:
11

12 Plaintiffs, COMPLAINT FOR DAMAGES AND

EQUITABLE RELIEF:
13 v.
1. Violation of Cal. Civ. Code § 2924c
14 RUSHMORE LOAN MANAGEMENT
SERVICES LLC; ZBS LAW, LLP; AND 2. Violation of Cal. Civ. Code § 2923.6
15
DOES 1 TO 50
16 3. Violation of Cal. Civ. Code § 3273,
Defendant et seq.
17
4. Violation of 12 USC § 2605
18
5. Unfair Business Practices
19

20
21 DEMAND FOR JURY TRIAL
22

23

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PRELIMINARY ALLEGATIONS
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1. In the case at hand, Plaintiff was current on his loan until the COVID-19 pandemic began
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and, due to a COVID-19 hardship, he was placed into a forbearance agreement. Since the
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forbearance ended, Defendants have pushed to foreclose on Plaintiff without reviewing Plaintiff
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COMPLAINT FOR DAMAGES AND EQUITABLE RELIEF
 1 for any loss mitigation options and without providing Plaintiff with a reinstatement quote, per

2 Plaintiff’s many requests. In short, Defendants are attempting to capitalize on Plaintiff’s COVID-

3 19 hardship by stealing Plaintiff’s property at foreclosure. This lawsuit follows.

4 JURISDICTION AND VENUE

5 2. This is an action asserting violations of California State Law. These claims arise out of

6 the same controversy or sequence of events. Plaintiff is a property owner who brings this action

7 based on Defendants pursuit of foreclosure on Plaintiff’s property located at 2930 Neilsen Way

8 #306, Santa Monica, CA 90405 (hereinafter the “Property”). Venue is proper in this Court

9 because a substantial part of the events giving rise to the claims herein occurred in the County of

10 Los Angeles.

11 3. The court has personal jurisdiction over the parties as all Defendants engage in business

12 within the State of California. Defendants’ business involves providing mortgage loans and

13 related services to consumers in the State of California.

14 PARTIES

15 4. At all times mentioned herein, Plaintiff is the owner of the Property located at 2930

16 Neilsen Way #306, Santa Monica, CA 90405.

17 5. At all times mentioned herein, Plaintiff is informed and believes and therefore alleges that

18 RUSHMORE LOAN MANAGEMENT SERVICES LLC (hereinafter “RUSHMORE”) is a

19 diversified financial marketing and/or corporation engaged primarily in residential mortgage

20 banking and/or related business and was the servicer of the loan secured by Plaintiff’s property

21 during the time periods alleged herein. Plaintiff is informed and believes and thereon alleges that

22 RUSHMORE regularly conducts business in the State of California.

23 6. At all times mentioned herein, Plaintiff is informed and believes and therefore alleges that

24 ZBS LAW, LLP (hereinafter “ZBS”) is a law firm that is acting as the trustee of the loan secured

25 by Plaintiff’s property during the time periods alleged herein. Plaintiff is informed and believes

26 and thereon alleges that ZBS regularly conducts business in the State of California.

27

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COMPLAINT FOR DAMAGES AND EQUITABLE RELIEF
 1 AGENCY ALLEGATIONS

2 7. Plaintiff is informed and believes and thereon alleges that at all times herein mentioned,

3 each Defendant was acting as the agent, servant, employee, partner, co-conspirator, and/or joint

4 venture of each remaining Defendant. Each Defendant was acting in concert with each remaining

5 Defendant in all matters alleged, and each Defendant has inherited any and all violations or

6 liability of their predecessors-in-interest. Additionally, each Defendant has passed any and all

7 liability to their successors-in-interest, and at all times were acting within the course and scope of

8 such agency, employment, partnership, and/or concert of action.

9 STATEMENT OF FACTS

10 8. Plaintiff is the current owner of the property located at 2930 Neilsen Way #306, Santa

11 Monica, CA 90405.

12 9. Plaintiff purchased the property in 1998 and has resided there as his primary residence

13 since that time.

14 10. In 2004, Plaintiff obtained a first lien loan secured by the property in the amount of

15 $367,700 through Bank of America.

16 11. In 2019, servicing of the loan transferred to Defendant Rushmore. At that time, Plaintiff

17 was current on his loan.

18 12. In March 2020, the COVID-19 pandemic began and the state of California was forced into

19 a shelter in place, which negatively impacted Plaintiff’s income. As a result, he applied for, and

20 received, a three month COVID-19 forbearance from Defendant RUSHMORE for the March,

21 April and May 2020 payments. Thereafter, Defendants refused to continue the forbearance and,

22 instead, began foreclosure proceedings against Plaintiff by recording a Notice of Default in April

23 2021.

24 13. Thereafter, in July 2021, Defendants caused a Notice of Trustee’s Sale to be recorded

25 against Plaintiff’s property.

26 14. Thereafter, Plaintiff continued to try to work with Plaintiff for a modification or

27 forbearance, as he had been doing for some time. However, there was a sale date scheduled for

28 Plaintiff’s property on October 19, 2021 and he was growing concerned about the run around that
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COMPLAINT FOR DAMAGES AND EQUITABLE RELIEF
 1 he was getting from Defendants. As a result, on or around October 1, 2021, Plaintiff sent

2 Defendants a Qualified Written Request and a request for reinstatement. Thereafter, he began to

3 secure the funds necessary to reinstate the loan, which he intended to do once he received the

4 reinstatement amount from Defendants. Furthermore, he continued to submit the documents in

5 support of his loan modification application that Defendants had been requesting over and over

6 again.

7 15. Finally, on October 12, 2021, Defendants confirmed receipt of a complete loan

8 modification application. However, they have yet to confirm postponement of the sale scheduled

9 for October 19, 2021. Furthermore, they have failed to respond to Plaintiff’s Qualified Written

10 Request or to provide Plaintiff with a reinstatement quote, despite his being ready, willing and

11 able to reinstate the loan.

12 FIRST CAUSE OF ACTION

Violation of Cal. Civ. Code § 2924c
13 (AGAINST ALL DEFENDANTS)
14 16. Plaintiff incorporates all allegations of this complaint and re-alleges them as though they
15 were fully set forth herein.
16 17. Defendant’s conduct, as alleged above, has interfered with Plaintiff’s right of
17 reinstatement under California law.
18 18. Pursuant to California Civil Code § 2924c, whenever an obligation secured by a deed of
19 trust or mortgage on real property has become due or been declared due by reason of default, the
20 trustor or mortgagor or his or her successor in interest in the mortgaged or trust property or any
21 part thereof may pay to the beneficiary or the mortgagee the entire amount due and thereby cure
22 the default existing and thereby foreclosure proceedings initiated under the deed of trust or
23 mortgage as if the acceleration had not occurred. See Cal. Civ. Code 2924c(a)(1)
24 19. California Civil Code § 2924c(a)(2) delineates the categories of charges a beneficiary can
25 impose as a condition of loan reinstatement. Specifically, a beneficiary or its agent may only
26 charge the following as a condition of reinstatement:
27 (A) all amounts under the deed of trust then due under the deed of trust
28 (B) all amounts in default on recurring obligations not shown in the notice of default, and
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COMPLAINT FOR DAMAGES AND EQUITABLE RELIEF
 1 (C) all reasonable costs and expenses which are actually incurred in enforcing the terms of

2 the obligation, deed of trust, or mortgage, and

3 (D) trustee's or attorney's fees, subject to subdivision (d),

4 other than the portion of principal as would not then be due had no default occurred.

5 20. Pursuant to California Civil Code § 2924d(a), a beneficiary or its agent may demand as a

6 condition of reinstatement, to the extent allowed by subdivision (c) of Section 2924c, costs which

7 are actually incurred in enforcing the terms of the obligation and trustee's or attorney's fees as set

8 forth therein.

9 21. In the case at hand, Defendants violated Civil Codes § 2924c-d by frustrating Plaintiff’s

10 attempts to reinstate the loan and by not providing Plaintiff with a reinstatement quote, despite his

11 request for the same since October 1, 2021.

12 22. Despite these facts and with full knowledge of Plaintiff’s endeavors and attempt to

13 reinstate the loan, Defendant is still attempting to foreclose on the loan on October 19, 2021 in

14 interference with Plaintiff’s right to reinstate.

15 23. Defendant’s conduct has resulted in various harms including, but not limited to, the

16 ongoing default which accumulated on the loan after its right to reinstate the loan was interfered

17 with, credit damage, the fees charged to the loan and attorney’s fees. Furthermore, Plaintiff is

18 entitled to injunctive relief to enjoin the sale of the property that is scheduled to take place after

19 Plaintiff has reinstated the loan.

SECOND CAUSE OF ACTION
20 Violation of Cal. Civ. Code § 2923.6
21 (AGAINST ALL DEFENDANTS)
24. Plaintiff incorporates all allegations of this complaint and re-alleges them as though they
22
were fully set forth herein.
23
25. Defendant violated § 2923.6(c) of the California Civil Code which provides that “[i]f a
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borrower submits a complete application for a first lien loan modification offered by, or through,
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the borrower’s mortgage servicer, a mortgage servicer, mortgagee, trustee, beneficiary, or
26
authorized agent shall not record a notice of default or notice of sale or conduct a trustee’s sale,
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while the complete first lien loan modification application is pending.”
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COMPLAINT FOR DAMAGES AND EQUITABLE RELIEF
 1 26. At all times relevant, Plaintiff was the owner of the Property and resided therein as his

2 primary and principal residence.

3 27. On October 12, 2021, Plaintiff submitted a complete loan modification application to

4 Defendant. Despite this fact, a Trustee’s Sale is scheduled to occur on October 19, 2021.

5 28. Defendant violated Cal. Civ. Code § 2923.6. Pursuant to Civil Code § 2924.12, Plaintiff is

6 entitled to injunctive relief for the material violation and attorney’s fees.
THIRD CAUSE OF ACTION
7 Violation of Cal. Civ. Code § 3273, et seq.
8 (AGAINST ALL DEFENDANTS)
29. Plaintiff incorporates all allegations of this complaint and re-alleges them as though they
9
were fully set forth herein.
10
30. Defendants violated § 3273.10 of the California Civil Code, which provides that “[i]f a
11
mortgage servicer denies a forbearance request made during the effective time period, the
12
mortgage servicer shall provide written notice to the borrower that sets forth the specific reason or
13
reasons that forbearance was not provided.”
14
31. In the present case, Plaintiff was current on payments as of February 1, 2020.
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32. Plaintiff made all of the payments under the loan. However, Plaintiff was provided with a
16
forbearance in March – May 2020 as a result of a COVID hardship. Plaintiff requested that the
17
forbearance be extended, but Defendant denied the request without providing notice to Plaintiff of
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the reason for the denial.
19
33. Furthermore, pursuant to Cal. Civ. Code § 3273.11, “[a] mortgage servicer shall comply
20
with applicable federal guidance regarding borrower options following a COVID-19 related
21
forbearance.” Furthermore, this section applies regardless of whether the loan is federally backed
22
or non-federally backed. (Cal. Civ. Code § 3273.11(b) and (c)).
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34. In the present case, Defendants did not comply with federal guidelines regarding the
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forbearance agreement requested by Plaintiff. In fact, Defendants did not review Plaintiff’s
25
forbearance request whatsoever.
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35. Pursuant to Cal. Civ. Code § 3723.15, Plaintiff is entitled to injunctive relief to prevent the
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unlawful sale of the Property while forbearance options are available.
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COMPLAINT FOR DAMAGES AND EQUITABLE RELIEF
 FOURTH CAUSE OF ACTION
1 Violation of 12 USC § 2605
2 36. Plaintiff incorporates all allegations of this complaint and re-allege them as though they

3 were fully set forth herein.

4 37. Defendant’s conduct constitutes violations of 12 USC § 2605(e) which provides that a

5 servicer must respond to any qualified written request by a borrower for information relating to the

6 servicing of the loan within a certain time frame and with certain information. Defendant entirely

7 failed to do so. On October 1, 2021, Plaintiff sent a Qualified Written Request to Defendant but

8 Defendant has failed to respond to the letter and, instead, is proceeding with foreclosure of the

9 property.

10 38. As a result of Defendant’s violations of this statute, Plaintiffs have suffered actual

11 damages including, but not limited to, loss of money and property, losses through overcharges,

12 incurred attorneys' fees and costs to save his home, a loss of reputation and goodwill, destruction

13 of credit, severe emotional distress, frustration, fear, anger, helplessness, nervousness, anxiety,

14 sleeplessness, sadness, and depression, according to proof at trial but within the jurisdiction of

15 this Court. Defendant consciously disregarded Plaintiffs’ rights, deliberately breaching their

16 respective duties, showing willful misconduct, malice, fraud, wantonness, oppression, and entire

17 want of care, thus authorizing the imposition of punitive damages.

18 FIFTH CAUSE OF ACTION

Unfair Competition
19
Violation of Business and Professions Code Section 17200 et seq.
20
21 39. Plaintiff incorporates all allegations of this complaint and re-alleges them as though they

22 were fully set forth herein.

23 40. Defendant’s conduct, as alleged above, constitutes unlawful, unfair, and/or fraudulent

24 business practices, as defined in the California Business and Professions Code § 17200 et seq.

25 California Business and Professions Code § 17200 et seq. incorporates and provides a basis for

26 enforcement of violations of other statutes and laws and those violations as a business practice.

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COMPLAINT FOR DAMAGES AND EQUITABLE RELIEF
 1 41. Specifically, Defendant’s violations of California Civil Code §§ 2943 and 2924c, et seq.

2 constitute unfair business practices in violation of California Business and Professions Code §

3 17200 et seq.

4 42. As a result of Defendant’s wrongful conduct, Plaintiff has suffered various injuries

5 according to proof at trial, including but not limited to the imminent loss of property.

6 43. Plaintiff seeks injunctive relief enjoining Defendant from engaging in the unfair business

7 practices described herein.

8 44. Plaintiff further seeks restitution, disgorgement of sums wrongfully obtained, costs of suit,

9 reasonable attorney’s fees, and such other and further relief as the Court may deem just and proper.

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DEMAND FOR JURY TRIAL AND PRAYER FOR DAMAGES
11

12 WHEREFORE, Plaintiff GUY HART demands a trial by jury. Plaintiff prays for
judgment and order against Defendants, as follows:
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1. That judgment is entered in Plaintiff’s favor and against Defendants, and each of them;
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2. For damages, disgorgement, and injunctive relief;
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3. For attorneys fees;
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4. For such other and further relief as the Court may deem just and proper.
17

18 DATED: October 15, 2021 Respectfully submitted,

19
SHAPERO LAW FIRM
20
21 Sarah Shapero, Esq.
Attorney for Plaintiff
22
GUY HART
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COMPLAINT FOR DAMAGES AND EQUITABLE RELIEF