# Opinion

> District Court, S.D. California · May 28, 2026

URL: https://www.frixlaw.com/law-library/cases/11372809

## Case

- **Full name:** Dale Sundby and Edith Littlefield Sundby v. Fidelity National Title Insurance Company, Scot Fine, Marquee Funding Group, Inc., Platinum Loan Servicing, Inc., Ryan Joe (R.J.) Solovy, Troy H. Slome, Jeffrey Myers, Kathleen Myers, Andres Salsido, Trustee, Benning Management
- **Court:** District Court, S.D. California
- **Decided:** May 28, 2026
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

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8 UNITED STATES DISTRICT COURT
9 SOUTHERN DISTRICT OF CALIFORNIA
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11 Dale Sundby and Edith Littlefield Sundby, Case No.: 23-CV-01239-GPC-AHG

12 Plaintiffs,
ORDER GRANTING DEFENDANTS
13 v. FIDELITY NATIONAL TITLE
INSURANCE COMPANY, SCOT
14 Fidelity National Title Insurance
FINE, MARQUEE FUNDING
Company; Marquee Funding Group, Inc.;
15 GROUP, INC., PLATINUM
Platinum Loan Servicing, Inc.; Scot Fine;
SEVICING, INC., AND RYAN JOE
16 Ryan Joe (R.J.) Solovy; Troy H. Slome;
SOLOVY’S MOTION TO DISMISS;
Jeffrey Myers; Kathleen Myers; Andres
17 DISMISSING ACTION AS TO ALL
Salsido, Trustee; Benning Management
DEFENDANTS
18 Group 401(k) Profit Sharing Plan;

Christopher Myers; Vickie McCarty;
19 [ECF No. 130]
Dolores Thompson; Kimberly Gill
20 Rabinoff; Equity Trust Company,
Custodian FBO Steven M. Cobin
21
Traditional IRA; Todd B. Cobin, Trustee;
22 Barbara A. Cobin, Trustee; Fasack
Investments LLC; Steven M. Cobin,
23
Trustee; Susan L. Cobin, Trustee; and
24 Does 1-X, Inclusive,,
25 Defendants.

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1 Before the Court is Defendant Fidelity National Title Insurance Company’s
2 (“Fidelity”) motion to dismiss Plaintiffs’ complaint. ECF No. 130. Defendants Scot Fine,
3 Ryan Joe Solovy, Marquee Funding Group, Inc., and Platinum Loan Servicing, Inc., have
4 joined Fidelity’s motion. See ECF Nos. 154, 157. For the reasons outlined below, the Court
5 GRANTS the motion with prejudice and without leave to amend, and DISMISSES the
6 action as to all Defendants.
7 BACKGROUND
8 I. Original Complaint
9 On November 1, 2022, Plaintiffs Dale Sundby and Edith Littlefield Sundby,
10 appearing pro se as individuals and in their capacity as trustees of Declaration of Trust,
11 Trust No. 1989-1 Dated: January 26, 1989 (“the Trust”), filed their initial complaint against
12 Defendant Fidelity National Title Company (“Fidelity”) and Doe Defendants I-X in the
13 Central District of California. ECF No. 1. The facts giving rise to the complaint concerned
14 allegedly altered mortgage loan documents as to the Sundbys’ residence in La Jolla,
15 California. See generally ECF No. 1.
16 The original complaint alleged that in 2019, Dale Sundby, appearing pro se on behalf
17 of the Trust, initiated litigation against the lenders concerning the altered loan documents.
18 Id. ¶¶ 50–55; see Case No. 19-cv-390 (“Case 390”), ECF No. 1. The Sundbys initially
19 alleged that Fidelity, as the policy insurer, had effective control over the litigation in Case
20 390, including selecting and directing counsel and the defendants to defend against the
21 claims. ECF No. 1, at ¶¶ 58–69. The Sundbys further alleged that Fidelity improperly
22 caused a revoked deed of trust to be recorded, caused the initiation of default proceedings,
23 and caused the foreclosure of Sundbys’ property (“the Property”). Id. ¶¶ 82–116. The
24 Sundbys alleged four causes of action concerning the purported wrongful foreclosure of
25 their Property. Id. ¶¶ 117–96.
26 In 2023, the Court stayed this case pending the outcome of Mr. Sundby’s appeal to
27 the Ninth Circuit Court of Appeals in Case 390. ECF No. 96. The Court did so in
1 consideration of interconnected questions of law and fact between the two cases. ECF No.
2 96, at 6–7. Specifically, the Court noted the relevance of questions relating to the Sundbys’
3 capacity to represent the Trust pro se and Dale and Edith Sundby’s standing to bring the
4 alleged causes of action as individuals. Id.
5 II. Motion for Leave to File First Amended Complaint
6 Given the Ninth Circuit’s decision in Case 390, on November 12, 2025, the Sundbys
7 re-filed a motion for leave to file a first amended complaint in this case. ECF No. 114. On
8 November 18, 2025, Fidelity re-filed a motion to dismiss. ECF No. 118.
9 The Sundbys’ motion for leave to file a first amended complaint was premised on
10 an alleged “Assignment of Claims and Ratification” from the Trust to Dale and Edith
11 Sundby as individuals, wherein the Trust “assign[ed] to the Assignees all Trust claims
12 relating to the Events” regarding the Property at issue in this case (“the Assignment”).1
13 ECF No. 114, at 2, 8, 11. The Sundbys argued that the Assignment of claims from the Trust
14 to the Sundbys “forclose[s] any capacity objections” that Defendants may raise. ECF No.
15 114, at 4.
16 Though the Assignment was the Sundbys’ primary justification for amendment,
17 Fidelity failed to address the Assignment—or how it might impact the Sundbys’ standing
18 to bring their claims—in opposing the Sundbys’ motion. Thus, the Court found that Fidelity
19 failed to overcome the presumption in favor of granting leave to amend. ECF 127, at 5.
20 III. First Amended Complaint
21 On February 13, 2026, the Sundbys filed their first amended complaint (“FAC”).
22 ECF 128. The FAC lists only Dale Sundby and Edith Littlefield Sundby as plaintiffs in
23 their individual capacities. ECF No. 128, at 1. The Sundbys also added several additional
24
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26 1 The Assignment of Claims and Ratification is attached to the Sundbys’ motion for leave
27 to file a first amended complaint as Exhibit 2. ECF No. 114, at 8.
1 Defendants, which the Sundbys deemed “related participants already identified in the
2 record.” ECF No. 122, at 2. The changes to the body of the FAC function primarily to add
3 the new Defendants’ names into Plaintiffs’ claims. The factual allegations remain largely
4 unedited and unchanged. Compare ECF No. 1, with ECF No. 128.
5 The FAC includes no mention of the Assignment from the Trust to the Plaintiffs,
6 and the Assignment is not attached to the FAC. See generally ECF No. 128.
7 Fidelity moved to dismiss the Sundbys’ first amended complaint. ECF No. 130. That
8 motion is fully briefed. ECF Nos. 134, 155. Defendants Scot Fine, Ryan Joe Solovy,
9 Marquee Funding Group, Inc., and Platinum Loan Servicing, Inc. (“the Marquee
10 Defendants”)—Defendants who were added to this case via the FAC—have joined
11 Fidelity’s motion dismiss, except as to those arguments unique to Fidelity as an insurer.
12 See ECF Nos. 154, 157. The Marquee Defendants have also filed their own motion to
13 dismiss, ECF No. 154, which Plaintiffs have opposed, ECF No. 164.
14 A final group of Defendants—Benning Management Group 401(k) Profit Sharing
15 Plan, Barbara A. Cobin, Steven M. Cobin, Susan L. Cobin, Todd B. Cobin, Equity Trust
16 Company FBO Steven M. Cobin Traditional IRA, Fasack Investments LLC, Vickie
17 McCarty, Christopher Myers, Jeffrey Myers, Kathleen Myers, Kimberly Gill Rabinoff,
18 Andres Salsido, Troy H. Slome (together, the “Investor Defendants”)—have also filed a
19 separate motion to dismiss. ECF No. 163. Plaintiffs have opposed that motion. ECF No.
20 175.
21 IV. The Sundbys’ Other Litigation
22 The Sundbys have litigated several other cases relating to the same facts giving rise
23 to this litigation. Multiple federal courts have dismissed the Sundbys’ various claims on
24 the grounds that (1) the Sundbys require counsel to litigate any claims on behalf of the
25 Trust, and (2) the Sundbys lack standing to advance the claims in their individual capacity.
26 In Sundby v. Landau, Judge Scarsi in the Central District of California considered
27 various claims “relat[ing] to the foreclosure” of the Property at issue here, including claims
1 for fraud, abuse of process, conversion, tortious interference with contractual relations, and
2 violations of RICO and § 1983. Sundby v. Landau, No. 2:24-CV-07276-MCS-BFM, 2025
3 WL 1090165, at *1, *4 (C.D. Cal. Mar. 14, 2025), reconsideration denied, No. 2:24-CV-
4 07276-MCS-BFM, 2025 WL 2374824 (C.D. Cal. May 19, 2025), and reconsideration
5 denied, No. 2:24-CV-07276-MCS-BFM, 2025 WL 2374825 (C.D. Cal. July 2, 2025),
6 and aff’d, No. 25-4180, 2026 WL 473936 (9th Cir. Feb. 19, 2026), and aff'd, No. 25-4180,
7 2026 WL 473936 (9th Cir. Feb. 19, 2026), and reconsideration denied, No. 2:24-CV-
8 07276-MCS-BFM, 2025 WL 2374825 (C.D. Cal. July 2, 2025), and aff’d, No. 25-4180,
9 2026 WL 473936 (9th Cir. Feb. 19, 2026), and aff'd, No. 25-4180, 2026 WL 473936 (9th
10 Cir. Feb. 19, 2026). Judge Scarsi determined that Dale and Edith Sundby, in their individual
11 capacities, were not the real parties in interest and lacked standing to assert claims related
12 to the foreclosure of the Property. Id. at *3-*4. The court further noted that the Sundbys
13 could not represent the Trust pro se: “Absent argument from counsel representing the trust,
14 the Court cannot confirm the trust may be represented in federal court by a nonattorney
15 trustee.” Id.
16 Similarly, in Sundby v. San Diego Sherriff’s Department, Judge Hayes in the
17 Southern District of California considered claims “related to the execution of a writ of
18 possession” of the same Property at issue in this case. Sundby v. San Diego Cnty. Sheriff's
19 Dep't, No. 3:24-CV-1535-WQH-BJW, 2026 WL 673819, at *1 (S.D. Cal. Mar. 10, 2026)
20 (internal quotation marks and citation omitted). Judge Hayes found that Mr. Sundby, in his
21 individual capacity, had not shown that he, rather than the Trust, was the real party in
22 interest in the case. Id. at *5. The court further found that it could not consider any claims
23 asserted on behalf of the Trust unless the Trust obtained legal counsel. Id. at *6.
24 In another case before Judge Hayes, Sundby v. Landau, the court considered a claim
25 for “restitution of ownership value for wrongful dispossession” that sought relief due to
26 Sundby’s alleged wrongful exclusion from the Property. See Sundby v. Landau, No. 3:25-
27 cv-00668-WQH-BJW, Dkt. No. 27, at 11. Judge Hayes assessed whether Mr. Sundby, “in
1 his individual capacity, has an ownership claim over the Property such that he qualifies as
2 a real party in interest. In the absence of an ownership interest, [Mr. Sundby] lacks standing
3 to bring his cause of action against Defendants.” Id. at 12. The court determined that Mr.
4 Sundby had failed to show any such property interest, and therefore had not demonstrated
5 that he was the real party in interest with the necessary standing to bring his claim. Id. at
6 12-13. The Court also reiterated Plaintiff’s inability to bring causes of action on behalf of
7 the Trust without counsel. Id. at 9.
8 In Case 390, wherein this Court considered Mr. Sundby’s claims relating to
9 violations of the Truth in Lending Act, the Court held that Mr. Sundby cannot litigate
10 claims on behalf of the trust—or questions related to Trust ownership—without counsel.
11 Sundby v. Marquee Funding Grp. Inc., No. 19-CV-0390-GPC-AHG, 2023 WL 2565168,
12 at *3-*4 (S.D. Cal. Mar. 17, 2023). The Court further found that Mr. Sundby, in his
13 individual capacity, lacked standing to assert the TILA claims because he was not a party
14 to the mortgage loan. See Sundby v. Marquee Funding Grp., Inc., No. 19-CV-00390-GPC-
15 AHG, 2026 WL 559772, at *3 (S.D. Cal. Feb. 27, 2026), reconsideration denied, No. 19-
16 CV-00390-GPC-AHG, 2026 WL 1398781, at *4 (S.D. Cal. Apr. 22, 2026); see also
17 Sundby v. Marquee Funding Grp., Inc., No. 19-CV-0390-GPC-AHG, 2023 WL 4686445,
18 at *2-*3 (S.D. Cal. July 21, 2023), aff'd sub nom. In re Sundby, No. 23-55659, 2025 WL
19 1794429 (9th Cir. June 30, 2025).
20 LEGAL STANDARD
21 The Moving Defendants2 move to dismiss the Sundbys’ complaint under both
22 Federal Rules of Civil Procedure (“Rules”) 12(b)(1) and 12(b)(6).3
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2 “Moving Defendants” refers to the Defendants that filed and joined this motion to dismiss.
26 This includes Fidelity National Title Insurance Company and the Marquee Defendants.
27 3 “Rule” or “Rules” refer to the Federal Rule of Civil Procedure unless otherwise noted.
1 I. Rule 12(b)(1)
2 Federal Rule of Procedure 12(b)(1) allows defendants to seek dismissal of a claim
3 or action for a lack of subject matter jurisdiction. A “lack of Article III standing requires
4 dismissal for lack of subject matter jurisdiction under Federal Rule of Civil Procedure
5 12(b)(1).” Maya v. Centex Corp., 658 F.3d 1060, 1067 (9th Cir.2011). Dismissal under
6 Rule 12(b)(1) is appropriate if the complaint, considered in its entirety, fails to allege facts
7 on its face that are sufficient to establish subject matter jurisdiction. In re Dynamic
8 Random Access Memory (DRAM) Antitrust Litigation, 546 F.3d 981, 984–85 (9th Cir.
9 2008). Although the defendant is the moving party in a motion to dismiss brought under
10 Rule 12(b)(1), the plaintiff is the party invoking the court's jurisdiction. As a result, the
11 plaintiff bears the burden of proving that the case is properly in federal court. McCauley
12 v. Ford Motor Co., 264 F.3d 952, 957 (9th Cir. 2001) (citing McNutt v. General Motors
13 Acceptance Corp., 298 U.S. 178, 189 (1936)).
14 Attacks on jurisdiction pursuant to Rule 12(b)(1) can be either facial, confining the
15 inquiry to the allegations in the complaint, or factual, permitting the court to look beyond
16 the complaint. See Savage v. Glendale Union High Sch., 343 F.3d 1036, 1039 n.2 (9th Cir.
17 2003). “In a facial attack, the challenger asserts that the allegations contained in a
18 complaint are insufficient on their face to invoke federal jurisdiction. By contrast, in a
19 factual attack, the challenger disputes the truth of the allegations that, by themselves,
20 would otherwise invoke federal jurisdiction.” Safe Air for Everyone v. Meyer, 373 F.3d
21 1035, 1039 (9th Cir. 2004).
22 Here, Defendant raises a facial attack on jurisdiction. See generally ECF No.
23 130. The Court “resolves a facial attack as it would a motion to dismiss under Rule
24 12(b)(6): Accepting the plaintiff's allegations as true and drawing all reasonable inferences
25

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1 in the plaintiff's favor, the court determines whether the allegations are sufficient as a legal
2 matter to invoke the court's jurisdiction.” Leite v. Crane Co., 749 F.3d 1117, 1121 (9th
3 Cir. 2014) (citing Pride v. Correa, 719 F.3d 1130, 1133 (9th Cir. 2013)).
4 II. Rule 12(b)(6)
5 Federal Rule of Civil Procedure 12(b)(6) permits dismissal for “failure to state a
6 claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). Dismissal under Rule
7 12(b)(6) is appropriate where the complaint fails to state or allege sufficient facts to
8 support a cognizable legal theory. Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699
9 (9th Cir. 1990).
10 “To survive a motion to dismiss, a complaint must contain sufficient factual matter,
11 accepted as true, ‘to state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal,
12 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
13 “A claim has facial plausibility when the plaintiff pleads factual content that allows the
14 court to draw the reasonable inference that the defendant is liable for the misconduct
15 alleged.” Id. “Threadbare recitals of the elements of a cause of action, supported by mere
16 conclusory statements, do not suffice.” Id.
17 When reviewing a Rule 12(b)(6) motion, the court accepts all facts alleged in the
18 complaint as true and draws all reasonable inferences in favor of the non-moving party.
19 Chubb Custom Inc. v. Space Sys./Loral, Inc., 710 F.3d 946, 956 (9th Cir. 2013).
20 “Where a motion to dismiss is granted, ‘leave to amend should be granted unless
21 the court determines that the allegation of other facts consistent with the challenged
22 pleading could not possibly cure the deficiency.’” Corbett v. Pharmacare U.S., Inc., 544
23 F. Supp. 3d 996, 1003 (S.D. Cal. 2021) (quoting DeSoto v. Yellow Freight Sys., Inc., 957
24 F.2d 655, 658 (9th Cir. 1992)).
25 //
26 //
27 //
1 DISCUSSION
2 I. The Sundbys Lack Standing To Bring Their Claims
3 The Moving Defendants argue that the Sundbys lack standing to assert any of their
4 wrongful foreclosure claims because they lacked any ownership interest in the foreclosed-
5 upon Property. ECF No. 130, at 12.
6 Plaintiffs argue that they have standing because (1) they have pled personal injuries;
7 (2) a wrongful foreclosure action does not require ownership interest; (3) the Trust
8 quitclaimed ownership interest from the Trust to Dale and Edith Sundby; (4) the Trust
9 Assigned all claims from the Trust to Dale and Edith Sundby; (5) Federal Rule of Civil
10 Procedure 17(a)(3) permits the Sundbys to proceed as the real party in interest; and (6) the
11 harm the Sundbys’ experienced is traceable to Defendants’ conduct. ECF No. 134, at 13-
12 15.
13 A. Rule 12(b)(1)
14 To establish Article III standing, a “plaintiff must have (1) suffered an injury in fact,
15 (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely
16 to be redressed by a favorable judicial decision.” Spokeo, Inc. v. Robins, 578 U.S. 330, 338,
17 136 S. Ct. 1540, 1547, 194 L. Ed. 2d 635 (2016), as revised (May 24, 2016). This case
18 primarily concerns injury in fact, the “‘[f]irst and foremost’ of standing's three elements.”
19 Id. (quoting Steel Co. v. Citizens for Better Environment, 523 U.S. 83, 103 (1998)). “To
20 establish injury in fact, a plaintiff must show that he or she suffered ‘an invasion of a legally
21 protected interest’ that is ‘concrete and particularized’ and ‘actual or imminent, not
22 conjectural or hypothetical.’” Id. at 339 (quoting Lujan v. Defenders of Wildlife, 504 U.S.
23 555, 560 (1992)).
24 The California Court of Appeals has noted that a post-foreclosure wrongful
25 foreclosure plaintiff must plead an ownership interest in the property to confer standing.
26 See Hacker v. Homeward Residential, Inc., 26 Cal. App. 5th 270, 278-79 (2018) (“Hacker
27 failed there to plead an ownership interest in the property sufficient to confer standing.”).
1 Federal courts in this Circuit have interpreted California wrongful foreclosure law
2 similarly: “The party attacking the foreclosure sale must have had some interest in the
3 foreclosed property.” Shetty v. JPMorgan Chase Bank, No. CV-16-8986-MWF-JPRX,
4 2017 WL 4685547, at *4 (C.D. Cal. June 23, 2017), aff'd sub nom. Shetty v. JPMorgan
5 Chase Bank, N.A., 735 F. App'x 398 (9th Cir. 2018) (finding that, where plaintiff lacked
6 ownership interest and was not borrower on the loan, “Plaintiff did not have any interest in
7 the Property and did not suffer any injury from the foreclosure.”); see also Sundby v.
8 Landau, 2025 WL 1090165, at *3 (finding that the Sundbys lacked ownership in the
9 Property and therefore lacked standing to assert claims relating to the foreclosure of the
10 Property).
11 Here, the FAC alleges that the Trust was the borrower on the relevant loan
12 documents, see ECF No. 128, ¶¶ 33-61, and does not allege that the Sundbys, as
13 individuals, had any ownership interest in the Property at the time of the foreclosure.
14 Exhibits attached to the FAC demonstrate that Dale and Edith Sundby signed the relevant
15 loan documents in their capacity as Trustees, see, e.g., ECF No. 128, at 30-31, and that the
16 Property’s title was vested in the Trust, ECF No. 128, at 69. Thus, taking the allegations in
17 the FAC as true, FAC demonstrates that the Sundbys, in their individual capacities, did not
18 have any ownership interest in the Property at the time of the foreclosure. As a result, FAC
19 has not shown that the alleged wrongful foreclosure violated the Sundbys’ legally protected
20 interests where the harm alleged is the loss of the Property, see ECF No. 128, ¶¶ 153, 174,
21 195, 215. In sum, the Sundbys have not established that they suffered an injury in fact
22 necessary to convey Article III standing as related to their wrongful foreclosure claims. See
23 Shetty, 2017 WL 4685547, at *4; Hacker, 26 Cal. App. 5th at 278-79; Lundy v. Selene Fin.,
24 LP, No. 15-CV-05676-JST, 2017 WL 2652048, at *4 (N.D. Cal. June 20, 2017) (“Plaintiff
25 cannot demonstrate standing [for wrongful foreclosure claim] through the loss of the
26 subject property,” because “he gave up his ownership interest in that property.”); Bianchi
27 v. Bank of Am., N.A., No. 12CV750-MMA MDD, 2012 WL 11946982, at *2 (S.D. Cal.
1 May 17, 2012) (finding plaintiff lacked standing to bring wrongful foreclosure claim where
2 she lacked any ownership interest in the property). C.f. Johnson v. Ocwen Loan Servicing,
3 374 F. App'x 868, 873 (11th Cir. 2010) (dismissing plaintiff's complaint alleging TILA
4 violations because plaintiff “fail[ed] to establish Article III standing, because [plaintiff]
5 was not a borrower or otherwise obligated on the . . . loan and, therefore, did not suffer an
6 injury-in-fact.”).
7 The Sundbys’ arguments to the contrary are unsuccessful. As an initial matter, it is
8 not enough that the Sundbys have generally alleged that they were “harmed by the
9 wrongful foreclosure.” ECF No. 128, ¶¶ 152, 173, 194, 214. This is not the type of “injury”
10 that may convey Article III standing. Rather, “[t]o establish injury in fact, a plaintiff must
11 show that he or she suffered ‘an invasion of a legally protected interest’ that is ‘concrete
12 and particularized[.]’” Spokeo, Inc., 578 U.S. at 339 (quoting Lujan, 504 U.S. at 560).
13 Because the FAC demonstrates that the Sundbys were not the borrowers on the loan nor
14 the owners of the Property, they lacked a “legally protected interest” in the Property as
15 related to the wrongful foreclosure claims they now seek to raise. See Shetty, 2017 WL
16 4685547, at *4; Hacker, 26 Cal. App. 5th at 278-79. The Sundbys have also not established
17 standing by alleging that “[t]he harm included the loss of Plaintiffs’ . . . property.” ECF
18 No. 128, ¶¶ 153, 174, 195, 215. Indeed, the Sundbys “cannot demonstrate standing through
19 the loss of the subject property,” when they had no ownership interest in that Property. See
20 Lundy, 2017 WL 2652048, at *4. Thus, the Sundbys’ general allegation of “harm” is not
21 enough to demonstrate the Sundbys’ Article III standing in their individual capacities. This
22 remains true even though the Sundbys allege that the “harm” they experienced is
23 “traceable” to Defendant Fidelity. ECF No. 134, at 15.
24 The Sundbys’ reliance on a quitclaim deed from the Trust to the Sundbys also fails.
25 As an initial matter, the Sundbys do not refer to the quitclaim deed in their FAC. See
26 generally ECF No. 128. Though the declaration regarding the quitclaim deed is on the
27 docket, ECF No. 50, the Court generally does not consider documents located elsewhere
1 on the docket when assessing the sufficiency of an operative pleading. Khoja v. Orexigen
2 Therapeutics, Inc., 899 F.3d 988, 998 (9th Cir. 2018) (“Generally, district courts may not
3 consider material outside the pleadings when assessing the sufficiency of a complaint under
4 Rule 12(b)(6) of the Federal Rules of Civil Procedure.”). While this rule has some
5 exceptions, none apply here. United States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003)
6 (“A court may, however, consider certain materials—documents attached to the complaint,
7 documents incorporated by reference in the complaint, or matters of judicial notice—
8 without converting the motion to dismiss into a motion for summary judgment.”).
9 Regardless of this pleading deficiency, multiple courts, including this one, have rejected
10 the Sundbys’ argument that the quitclaim deed of the Trust’s interest in the Property from
11 the Trust to the Sundbys conveyed an ownership interest sufficient to establish standing
12 for the Sundbys’ foreclosure-related claims. See Sundby v. Marquee Funding Grp., Inc.,
13 2026 WL 559772, at *4; Sundby v. Landau, 2025 WL 1090165, at *3-*4; Sundby v. San
14 Diego County Sherriff’s Department, 2026 WL 673819, at *5. The quitclaim deed from
15 the Trust to the Sundbys was executed after the completion of the foreclosure sale. See
16 ECF No. 50, at 2. “[S]ubsequent attempts to transfer property previously conveyed are
17 ineffective because the grantor no longer owns the property.” Shetty, 2017 WL 4685547,
18 at *4 (citation omitted). Thus, the quitclaim deed did not transfer any ownership interest to
19 the Sundbys. The Court again concludes that the quitclaim deed fails to establish that the
20 Sundbys have standing. See Sundby v. Marquee Funding Group, 2026 WL 559772, at *4.
21 The Sundbys’ arguments regarding the Assignment also fall short. Though the
22 Sundbys premised their motion for leave to file a first amended complaint on the purported
23 Assignment from the Trust to the Sundbys, the Sundbys failed to plead any facts relating
24 to the Assignment or attach the Assignment to their amended complaint. See generally ECF
25 No. 128. “In an action involving an assignment, a court must ensure that the plaintiff-
26 assignee is the real party in interest with regard to the particular claim involved by
27 determining: (1) what has been assigned; and (2) whether a valid assignment has been
1 made.” In re Brooms, 447 B.R. 258, 265 (9th Cir. 2011). Thus, a plaintiff must plead
2 sufficient allegations in his complaint that an assignment has been made and that it is valid.
3 Id.; see also MAO-MSO Recovery II, LLC v. Mercury Gen., No. CV 17-02525-AB-AJW,
4 2017 WL 5086293, at *4 (C.D. Cal. Nov. 2, 2017); Thomas Land & Dev., LLC v. Vratsinas
5 Constr. Co., No. 18-CV-1896-AJB-NLS, 2020 WL 3791676, at *6 (S.D. Cal. July 7, 2020).
6 Here, the Sundbys have pleaded no facts to support the assignment. See generally ECF No.
7 128. “Rather, it is only offered as an argument in [the Sundbys’] [o]pposition” to
8 Defendant’s motion to dismiss. See MAO-MSO, 2017 WL 5086293, at *4. “Therefore, the
9 Court cannot assume as true that the assignment was made.” Id. Additionally, as with the
10 quitclaim deed, the fact that the Assignment lives elsewhere on the docket—ECF No. 114,
11 at 8—is generally not relevant to a court’s assessment of the sufficiency of an operative
12 pleading. See Khoja, 899 F.3d at 998.
13 Finally, the Sundbys’ Rule 17(a)(3) arguments are also unsuccessful. Rule 17(a)(3)
14 counsels that a court “may not dismiss an action for failure to prosecute in the name of the
15 real party in interest” until the court provides an opportunity for the real party in interest to
16 join. Fed. R. Civ. P. 17(a)(3). The Rule exists to “prevent forfeiture of a claim when an
17 honest mistake was made” as to the real party in interest. Jones v. Las Vegas Metro. Police
18 Dep't, 873 F.3d 1123, 1128 (9th Cir. 2017) (quoting Goodman v. United States, 298 F.3d
19 1048, 1054 (9th Cir. 2002)). As an initial matter, the moving Defendants have challenged
20 the Sundbys’ Article III standing, not just the Sundbys’ prudential standing under Rule
21 17(a). See Kent v. N. California Reg'l Off. of Am. Friends Serv. Comm., 497 F.2d 1325,
22 1329 (9th Cir. 1974) (“Rule 17(a) does not give them standing; ‘real party in interest’ is
23 very different from [constitutional] standing.”). However, even if the Court was compelled
24 to dismiss the action under Rule 17(a), Rule 17(a)(3) would not save the Sundbys’ claims.
25 No “honest mistake” regarding the real party in interest was made here. Jones, 873 F.3d at
26 1128 (quoting Goodman, 298 F.3d at 1054). The Sundbys initially brought this action in
27 their individual capacities and in their capacities as trustees. The Sundbys then (1)
1 attempted to assign the Trust’s claims to the Sundbys and (2) amended the complaint to
2 remove the Trust from the action. Thus, the initial plaintiffs—the Sundbys in their
3 capacities as trustees—were the real parties in interest and there was no “understandable”
4 error at play. See Jones, 873 F.3d at 1128. The situation here is not the type contemplated
5 by Rule 17(a)(3), and relief under Rule 17 is unavailable.
6 The Court concludes that the FAC fails to demonstrate that the Sundbys suffered an
7 injury in fact necessary to establish Article III standing for their wrongful foreclosure
8 claims where the foreclosed-upon Property belonged to the Trust. Thus, the Court
9 GRANTS the Moving Defendants’ Rule 12(b)(1) motion to dismiss for lack of subject
10 matter jurisdiction.
11 B. Rule 12(b)(6)
12 Even if the Sundbys established Article III standing—which the Court determines
13 they have not—dismissal is appropriate under Rule 12(b)(6) because the Sundbys have
14 failed to satisfy the narrower prudential standing requirements of Federal Rule of Civil
15 Procedure 17(a). Doe v. Hamburg, No. C-12-3412, 2013 WL 3783749, at *5 (N.D. Cal.
16 July 16, 2013) (“While constitutional standing is evaluated under [Rule] 12(b)(1),
17 prudential standing is evaluated under Rule 12(b)(6).”); see also Arias v. Select Portfolio
18 Servicing, Inc., No. 1:17-CV-01130-DAD-SAB, 2018 WL 1518676, at *3 (E.D. Cal. Mar.
19 28, 2018). In addition to Article III standing, courts also “require as a prudential matter that
20 [a plaintiff] assert his own legal interests as the real party in interest.” Dunmore v. United
21 States, 358 F.3d 1107, 1112 (9th Cir. 2004). Notably, “not every party who meets the
22 standing requirements is a real party in interest.” In re Veal, 450 B.R. 897, 907 (B.A.P. 9th
23 Cir. 2011) (quoting 4 Moore's Federal Practice § 17.10[1], at p. 17–15 (3d ed. 2010)).
24 “Most real party in interest inquiries focus on whether the plaintiff or movant holds the
25 rights he or she seeks to redress.” Id. at 908.
26 Based on the allegations and exhibits in the FAC, the Court joins others in finding
27 that the Sundbys have failed to establish that they, in their individual capacities, rather than
1 the Trust, are the real parties in interest for claims relating to the foreclosure of the Property.
2 See Sundby v. San Diego Cnty. Sheriff's Dep't, 2026 WL 673819, at *5; Sundby v. Landau,
3 2025 WL 1090165, at *3-*4; See Sundby v. Landau, No. 3:25-cv-00668-WQH-BJW, Dkt.
4 No. 27, at 11-12. This Court agrees with Judge Scarsi in the Central District of California
5 in finding that “the [T]rust is only party with interest to bring claims related to the
6 foreclosure of the [P]roperty” where the asserted injury is the loss of the Property. Sundby
7 v. Landau, 2025 WL 1090165, at *4.
8 Further, Rule 17(a)(3) does not require that the Court provide the Sundbys with the
9 opportunity to substitute or join the Trust as the real party in interest, as the Sundbys have
10 already had the opportunity to pursue this action on behalf of the Trust and have declined
11 to do so by amending their complaint.
12 II. The Dismissal Is With Prejudice And Without Leave To Amend
13 The Court granted the Sundbys leave to file a first amended complaint on the
14 grounds that (1) the Sundbys had alleged a novel theory to cure their standing deficiencies
15 (the Assignment), and (2) Fidelity failed to address that theory. ECF No. 127. Given the
16 Sundbys’ pro se status and Fidelity’s failure to challenge the validity of the Assignment,
17 the Court declined to sua sponte assess the futility of the Assignment at the leave to amend
18 stage.
19 However, the Court has now provided the Sundbys an opportunity to amend their
20 complaint to introduce the Assignment as a mechanism to cure the standing and capacity
21 issues identified by this and other Courts. The Sundbys have failed to do so. Thus, before
22 the Court considers providing the Sundbys with another chance to amend, the Court will
23 assess whether the Assignment could fix the Sundbys’ standing defects, or whether a
24 subsequent opportunity to amend to plead facts relating to the Assignment would be futile.
25 See Corbett v. Pharmacare U.S., Inc., 544 F. Supp. 3d 996, 1013 (S.D. Cal. 2021)
26 (“[W]here leave to amend would be futile, the Court may deny leave to amend.”).
27
1 The Court finds that any subsequent amendment would be futile. The Sundbys’ only
2 standing argument that has yet to be considered and rejected by this Court or others is that
3 regarding the Assignment. The Court now finds that, even if the Sundbys’ complaint
4 included allegations regarding the Assignment, it would not cure the jurisdictional defects.
5 A party cannot use an Assignment as a means to circumvent a representation
6 requirement. This rule is regularly applied when a corporation assigns its claims to an
7 individual to avoid legal representation. See In re Heal, 442 B.R. 137 (Bankr. N.D. Cal.
8 2010) (“[A] non-lawyer may not appear nominally on his own behalf if the outcome might
9 benefit third parties. . . . The statute may not be circumvented through a purported
10 assignment of claims.” (internal citations omitted)); Kraft v. Chevron Corp., No. CV-21-
11 00575-PHX-DJH, 2021 WL 5882626, at *3 (D. Ariz. Dec. 10, 2021) (“Plaintiff may not
12 circumvent the longstanding rule requiring corporations to appear through counsel by a
13 purported assignment of the corporations’ claims.”); Kraft v. Tulare Cnty., No.
14 121CV00768JLTSKO, 2023 WL 2655851, at *2 (E.D. Cal. Mar. 27, 2023) (“[A]ssigning
15 claims does not permit circumvention of the long-standing rule that a corporation may not
16 be represented by a pro se individual.”); ISA Plus, LLC v. Prehired, LLC, No. 3:22-CV-
17 01211-JAH-JLB, 2025 WL 2677392, at *2 (S.D. Cal. Sept. 18, 2025) (“Jordan's attempt to
18 perform the role of an attorney and circumvent this requirement is neither original nor
19 persuasive. Other district courts within the Ninth Circuit have rejected this form of legal
20 gamesmanship.”); In re Kermit Douglas Brooms, No. ADV. 09-4584 AJ, 2010 WL
21 785930, at *1 (Bankr. N.D. Cal. Mar. 5, 2010), subsequently aff'd sub nom. In re Brooms,
22 447 B.R. 258 (B.A.P. 9th Cir. 2011), aff'd, 520 F. App'x 569 (9th Cir. 2013) (“And
23 significantly for present purposes, litigants may not circumvent the foregoing
24 [representation] rules through a purported assignment of claims.”). The Ninth Circuit has
25 also discouraged assignment as a means of circumventing a court order. See United States
26 v. Two Cessna 210 Aircraft, 933 F.2d 1018 (9th Cir. 1991) (unpublished table decision).
27
1 Other Circuits have found similarly. See, e.g., Pridgen v. Anderson, 113 F.3d 391,
2 393 (2d Cir. 1997) (a pro se litigant “may not assert pro se a claim that has been assigned
3 to the litigant by a corporation”); Palazzo v. Gulf Oil Corp., 764 F.2d 1381, 1385 (11th Cir.
4 1985) (“[w]e see no reason to permit any evasion of the general rule [requiring entities to
5 have licensed counsel] by the simple expedient of the assignment of corporate claims to
6 the pro se plaintiff”). The Seventh Circuit invalidated an assignment that was against
7 Illinois public policy where a plaintiff was using assignment “to attempt to engage in the
8 unauthorized practice of law.” Todd v. Franklin Collection Serv., Inc., 694 F.3d 849, 851
9 (7th Cir. 2012).
10 The Ninth Circuit has made clear that “[a] trustee may not represent a trust pro se in
11 federal court.” Sundby v. Marquee Funding Grp., Inc., No. 21-55504, 2022 WL 4826445,
12 at *1 (9th Cir. Oct. 3, 2022). California courts have held the same: “A non-attorney trustee
13 who represents the trust in court is representing and affecting the interests of the beneficiary
14 and is thus engaged in the unauthorized practice of law.” Ziegler v. Nickel, 64 Cal. App.
15 4th 545, 549 (1998).4
16 The Sundbys are familiar with this rule. It has been applied to them by this Court
17 and others across multiple lawsuits pertaining to the foreclosure at issue here. See supra
18 Background—IV: The Sundbys’ Other Litigation. Thus, the Court finds that the Sundbys’
19 purported Assignment is a “veiled attempt to avoid the rule from being applied to [them].”
20 Kraft, 2023 WL 2655851, at *2 (internal quotation marks omitted). Allowing the Sundbys
21

22
23 4 Courts have noted the potential exception to this rule if the plaintiff demonstrates that he
is the “beneficial owner” of the trust’s claims. See Sundby v. San Diego Sherriff’s Dep’t,
24
2025 WL 1557323, at *4 (citing cases). However, as applied to the Sundbys’ claims, this
25 Court—and others—have found that the Trust must obtain legal counsel “before the Court
may consider any arguments on behalf of the Trust, including arguments regarding
26
Plaintiff's ability to represent the Trust pro se.” Id.; Sundby v. Marquee Funding Grp., 2023
27 WL 256168, at *4; Sundby v. Landau, 2025 WL 1090165, at *4.
1 to acquire standing through the purported Assignment would simply allow them to utilize
2 assignment as a tool to circumvent a representation requirement enshrined in both state and
3 federal law. The Court declines to do so. Accordingly, any amendment to the Sundbys’
4 complaint which may seek to rectify standing deficiencies through the purported
5 Assignment would be futile.
6 Further, the FAC and the materials attached thereto clearly demonstrate that the
7 Trust, not the Sundbys, was the borrower on the relevant loan documents and had the
8 ownership interest in the Property at the time of the foreclosure. Aside from allegations
9 regarding the quitclaim deed and Assignment—both of which have been considered and
10 rejected by the Court—the Sundbys have provided no indication as to what additional facts
11 they could add to cure the Article III or prudential standing deficiencies of the FAC.
12 Considering the information before it, the Court finds that there are none.
13 The Sundbys’ claims are therefore DISMISSED WITH PREJUDICE and without
14 leave to amend.
15 III. The Dismissal Extends To The Non-Joined Defendants
16 The Court has determined that the Sundbys, in their individual capacities, lack
17 Article III standing to assert their wrongful foreclosure claims. Specifically, the Sundbys
18 cannot establish an injury in fact: Because the Sundbys have never possessed an ownership
19 interest in the Property, they cannot establish any invasion of a legally protected interest
20 related to their wrongful foreclosure claims where the harm alleged is the loss of the
21 Property. Shetty, 2017 WL 4685547, at *4 (where plaintiff lacked ownership interest and
22 was not borrower on the loan, “Plaintiff did not have any interest in the Property and did
23 not suffer any injury from the foreclosure.”); Lundy, 2017 WL 2652048, at *4 (“Plaintiff
24 cannot demonstrate standing [for wrongful foreclosure claim] through the loss of the
25 subject property,” because “he gave up his ownership interest in that property.”). This lack
26 of Article III standing “requires dismissal for lack of subject matter jurisdiction.” Maya,
27 658 F.3d at 1067.
1 The Sundbys’ lack of Article III standing applies to all their wrongful foreclosure
2 claims against all Defendants. The Federal Rules of Civil Procedure provide that “[i]f the
3 court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss
4 the action.” Fed. R. Civ. P. 12(h)(3). Such a dismissal must occur, whether it is upon a
5 party’s motion or sua sponte. Pac. Surgical Inst. of Pain Mgmt., Inc. v. Kennedy, 779 F.
6 Supp. 3d 1148, 1155 (S.D. Cal. 2025). (“When a court lacks subject matter jurisdiction, it
7 must dismiss the action, either upon a party's motion or sua sponte.”). Thus, although only
8 a portion of all Defendants are a party to the fully briefed motion to dismiss now before
9 the Court, ECF No. 130, the Court DISMISSES the Sundbys’ claims against all
10 Defendants. See Silverton v. Dep't of Treasury, 644 F.2d 1341, 1345 (9th Cir. 1981) (the
11 court may “dismiss an action as to defendants who have not moved to dismiss where such
12 defendants are in a position similar to that of moving defendants or where claims against
13 such defendants are integrally related”).5
14 CONCLUSION
15 For the foregoing reasons, the Court ORDERS as follows:
16 • The Moving Defendants’ motion to dismiss the Sundbys’ claims pursuant to
17 Federal Rule of Civil Procedure 12(b)(1), ECF No. 130, is GRANTED WITH
18 PREJUDICE and without leave to amend.
19 • Because the reasons for dismissal are not specific to the Moving Defendants, the
20 Court DISMISSES the action as to ALL DEFENDANTS.
21

22
23 5 The Court notes that this course of action—dismissing the Sundbys’ claims as to both the
Moving Defendants and those Defendants not party to the motion—would be appropriate
24
whether the Court dismissed the claim for lack of subject matter jurisdiction under Rule
25 12(b)(1) or failure to state a claim under Rule 12(b)(6). See See Silverton v. Dep't of
Treasury, 644 F.2d 1341, 1345 (9th Cir. 1981); Omar v. Sea-Land Serv., Inc., 813 F.2d
26
986, 991 (9th Cir. 1987) (“A trial court may dismiss a claim sua sponte under Fed. R. Civ.
27 P. 12(b)(6).”).
e The Court VACATES the hearing set for May 29, 2026, see ECF No. 131. The
2 Sundbys’ motion to continue the hearing, ECF No. 181, is DENIED as moot. All
3 pending motions to appear remotely at the hearing—ECF Nos. 179, 180—are
4 also DENIED as moot.
5 e All other pending motions to dismiss—ECF Nos. 154, 163—are DENIED as
6 moot.
7 IT IS SO ORDERED.
8 Dated: May 28, 2026 72
? Hon. athe Cae
10 United States District Judge
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28 92 717 01920 □□□ AUIS

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11372809. Public record. Not legal advice.