United States v. 2020-08-04 | 19-15251 | DENNIS TOBLER V. SABLES, LLC | precedential | opinion |

FOR PUBLICATION

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

DENNIS TOBLER; CINDI F. TOBLER,
Plaintiffs-Appellants,

v.

SABLES, LLC; BAYVIEW LOAN
SERVICING, LLC; THE BANK OF NEW
YORK MELLON,
Defendants-Appellees.
No. 19-15251

D.C. No.
2:18-cv-2220-
JCM-CWH

OPINION

Appeal from the United States District Court
for the District of Nevada
James C. Mahan, District Judge, Presiding

Submitted June 2, 2020
*

Portland, Oregon

Filed August 4, 2020

Before: Marsha S. Berzon, Daniel P. Collins, and
Lawrence VanDyke, Circuit Judges.

Opinion by Judge Collins

*
The panel unanimously concludes that this case is suitable for
decision without oral argument. See F
ED. R. APP. P. 34(a)(2)(C).

2 TOBLER V. SABLES

SUMMARY
**

Nevada Law / Foreclosure Mediation
The panel affirmed the district court’s dismissal of a
complaint alleging contractual and tortious breaches of the
implied covenant of good faith and fair dealing in the
mediation process.
The panel held that a request for judicial relief under
Nevada’s Foreclosure Mediation Rules is the exclusive
remedy under Nevada law for challenging a lender’s conduct
in the foreclosure mediation process. The panel held further
that all of plaintiffs’ claims rested on defendants’ asserted
failure to comply with the various requirements of the
foreclosure mediation program, and these claims could have
been raised in a timely request for review under Nevada’s
Foreclosure Mediation Rules. Accordingly, plaintiffs’
exclusive remedy under Nevada law for addressing these
deficiencies was a timely request for judicial review filed
within the applicable 10-day period set forth in Nevada
F.M.R. 20(2). The panel concluded that the district court
correctly held that the plaintiffs’ state common-law claims
and related requests for declaratory and injunctive relief
failed to state a claim upon which relief could be granted.

**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.

TOBLER V. SABLES 3

COUNSEL

Harold P. Gewerter, Harolder P. Gewerter Esq. Ltd., Las
Vegas, Nevada, for Plaintiffs-Appellants.

Natalie L. Winslow and Jamie K. Combs, Akerman LLP,
Las Vegas, Nevada, for Defendants-Appellees.

OPINION
COLLINS, Circuit Judge:
Dennis and Cindi Tobler appeal from the district court’s
dismissal of their complaint alleging contractual and tortious
breaches of the implied covenant of good faith and fair
dealing against Bank of New York Mellon (“BNYM”) and
its agents, Sables, LLC and Bayview Loan Servicing, LLC
(collectively, “Defendants”). We review de novo the district
court’s dismissal of the complaint for failure to state a claim,
see Zimmerman v. City of Oakland, 255 F.3d 734, 737 (9th
Cir. 2001), and finding no error, we affirm.
I
In October 2011, BNYM acquired all beneficial interest
in the deed of trust that secured the mortgage on the Toblers’
Las Vegas residence. After the Toblers fell behind on their
mortgage payments, they sought to avoid foreclosure by
invoking Nevada’s foreclosure mediation program. As we
explain in further detail below, that program allows a
delinquent Nevada mortgagor to seek a loan modification by
requesting mediation with the lender in accordance with the
applicable Nevada statute and the “Foreclosure Mediation
Rules” promulgated under it. See infra at 6–7. Since 2017,
the manner in which a homeowner triggers the mediation

4 TOBLER V. SABLES

program is by the filing of a mediation “petition” in the state
court. See Nev. Rev. Stat. § 107.086(3). The lender may not
proceed with foreclosure while that petition remains
pending. Id.
Under the auspices of this mediation program, the
Toblers attempted on three occasions between September
2014 and July 2018 to mediate with BNYM’s agents over
the loan delinquency, but these efforts were unsuccessful.
1

On July 24, 2018, after the third mediation had failed, the
mediator filed a report with the state court recommending
that the Toblers’ mediation petition be dismissed. Under the
applicable rules, the Toblers then had 10 days in which to
request relief to avoid dismissal, but they did not do so.
Noting that “[n]o timely objections ha[d] been filed” to the
mediator’s report, the state court dismissed the Toblers’
mediation petition on August 22, 2018. The Toblers did not
appeal that dismissal.
Having completed the mediation process, on October 18,
2018, Sables, LLC served the Toblers with a Notice of
Trustee’s Sale. In response, the Toblers on November 1,
2018 belatedly filed in state court a petition for judicial
review of the July 2018 mediation. However, because that
petition had not been filed within the 10-day period, it was
stricken as untimely.
On the same day that they filed their belated petition for
judicial review, the Toblers also filed this civil action against
Defendants in Nevada state court. The Toblers’ complaint
asserted that Defendants had acted in bad faith in the

1
At the time of the third and final mediation in 2018, Bayview Loan
Servicing, LLC was acting as the loan servicer on behalf of BNYM, and
Sables, LLC was the appointed Trustee on the deed of trust.

TOBLER V. SABLES 5

mediation process, thereby breaching their contractual and
tort-based duties arising from the implied covenant of good
faith and fair dealing. The Toblers sought compensatory and
punitive damages, as well as declaratory and injunctive
relief. Defendants removed the case to the district court
based on diversity jurisdiction under 28 U.S.C. § 1332.
Defendants thereafter moved to dismiss the complaint for
failure to state a claim, and the district court granted that
motion. This appeal followed.
II
The question before the district court was whether a
request for judicial relief under Nevada’s Foreclosure
Mediation Rules is the exclusive remedy under Nevada law
for challenging a lender’s conduct in the foreclosure
mediation process. It appears that this recurring issue
2
has
yet to be addressed by the Nevada Supreme Court in a
precedential decision, and we are thus tasked with deciding
that “issue[] of state law as we believe the state’s highest
court would decide [it].” HS Servs., Inc. v. Nationwide Mut.
Ins. Co., 109 F.3d 642, 644 (9th Cir. 1997). We agree with
the district court that, under Nevada law, the Toblers’
exclusive remedy for seeking to challenge Defendants’

2
See, e.g., Martin v. Bank of N.Y. Mellon, 2018 WL 387398, at *4
(D. Nev. Jan. 11, 2018) (timely petition for judicial review is exclusive
remedy for challenging mediation); Mesi v. Nevada Foreclosure
Mediation Program, 2014 WL 4929516, at *2 (D. Nev. Aug. 25, 2014)
(similar); Hine v. Bank of Am., N.A., 2012 WL 273385, at *4 (D. Nev.
Jan. 30, 2012) (similar); Lalwani v. Wells Fargo Bank, N.A., 2011 WL
4574338, at *4 (D. Nev. Sept. 30, 2011) (plaintiff complaining of
mediation deficiencies must first raise those claims in a petition for
review); but cf. Addington v. Bank of Am., N.A., 2013 WL 4040735, at *3
(D. Nev. Aug. 6, 2013) (petition for judicial review is not the exclusive
remedy, at least for claims of breach of a settlement contract allegedly
agreed to at the mediation).

6 TOBLER V. SABLES

mediation-related conduct was a timely request for judicial
review. As a result, the Toblers’ various causes of action
based on Nevada common-law duties failed to state a claim
upon which relief could be granted.
The relevant terms of the Nevada foreclosure mediation
program are set forth in § 107.086 of the Nevada Revised
Statutes and in the “Foreclosure Mediation Rules” issued by
the Nevada Supreme Court under § 107.086(12).
3
Subject
to certain exceptions, the program allows any Nevada
homeowner facing nonjudicial foreclosure to petition the
state court for mediation before a designated mediator. See
Nev. Rev. Stat. § 107.086(3). Both sides must participate in
the mediation in good faith, and each must provide specified
documents to the other. See id. § 107.086(5)–(6); Nev.
Foreclosure Mediation Rule (“F.M.R.”) 13. While the
mediation is ongoing, “no further action may be taken to
exercise the power of sale.” Nev. Rev. Stat. § 107.086(3).
If the mediation results in an agreement, the mediator
notifies the state court, which then enters an order reflecting
the agreed-upon loan modification. See Nev. Rev. Stat.
§ 107.086(9). If the mediation fails, then the mediator must
make an initial determination whether the parties complied
with their obligations under the program. Id. § 107.086(6),
(8). If the mediator determines that the lender failed to
participate in good faith or did not provide the required
documents, then the mediator must submit a
recommendation to the state court proposing sanctions
against the lender, which may include requiring a specified
loan modification. Id. § 107.086(6). But if the mediator
determines that the parties acted in good faith, the mediator

3
We rely on the versions of the statute and rules that governed the
final and dispositive 2018 mediation.

TOBLER V. SABLES 7

must then submit a recommendation that the mediation
petition “be dismissed,” and the state court may thereafter
issue an order dismissing the petition. Id. § 107.086(8).
Although the statute plainly contemplates that the parties
will be afforded an opportunity to respond to the mediator’s
recommendation before the state court issues its order, the
statute leaves the details of that procedure to the rules
promulgated by the Nevada Supreme Court. Those rules
provide that, “[f]ollowing submission of the mediator’s
statement, within 10 days, either party may submit a request
for appropriate relief” to the state court. Nev. F.M.R. 20(2).
The state court must then issue an appropriate order either
granting an agreed-upon loan modification, dismissing the
petition, or sanctioning the lender. Id. 20(3). If the
mediation petition is dismissed, a certificate is subsequently
issued that (if there is no other legal obstacle) allows the
lender to proceed with the foreclosure. Nev. Rev. Stat.
§ 107.086(8).
Because “[t]he goal of foreclosure mediation is to
produce an agreed-upon loan modification,” the applicable
judicial review provisions establish an “expedited”
proceeding to promptly address any failure to participate in
the mediation in good faith or to otherwise abide by the
mediation rules. Holt v. Regional Trustee Servs. Corp.,
266 P.3d 602, 606–07 (Nev. 2011) (en banc). Specifically,
the ability to request judicial relief in response to the
mediator’s report “affords a way to challenge compliance
with the statutory attendance, production, and good faith
requirements” of the mediation program. Id. at 606. Given
that the success of the mediation program requires prompt
enforcement of its requirements, the Nevada Supreme Court
has stated that an immediate request “for judicial review is
the exclusive remedy for a homeowner seeking to enforce an
agreement reached in the mediation program,” Surgeoner-

8 TOBLER V. SABLES

Jernigan v. CitiMortgage, Inc., 2012 WL 5857293, at *1
(Nev. Nov. 16, 2012) (unpublished “order of affirmance”)
(emphasis added), and that the Foreclosure Mediation Rules
“‘necessitate strict compliance’” with the applicable
deadline for seeking such judicial review, Nationstar
Mortg., LLC v. Rodriguez, 375 P.3d 1027, 1028 (Nev. 2016)
(en banc) (quoting Leyva v. National Default Servicing
Corp., 255 P.3d 1275, 1279 (Nev. 2011) (en banc)). The
Nevada Supreme Court has further underscored the
exclusive nature of that judicial-review remedy by holding
that objections to the mediation process must be resolved
through that process of judicial review and not “by bringing
a second proceeding before a different district court judge.”
Holt, 266 P.3d at 608.
Against this backdrop, we have little difficulty
concluding that Nevada law does not permit parties to evade
the mediation program’s exclusive judicial review
mechanism by repackaging their complaints about the
adequacy of the mediation process as state common-law
claims. Where, as here, the Nevada Legislature has created
a carefully reticulated statutory scheme that contemplates an
exclusive judicial-review mechanism, Nevada law generally
disfavors judicial recognition of additional remedies for
alleged violations of the statutory requirements. Republican
Attorneys Gen. Ass’n v. Las Vegas Metro. Police Dep’t,
458 P.3d 328, 332 (Nev. 2020) (“‘Where a statute gives a
new right and prescribes a particular remedy, such remedy
must be strictly pursued, and is exclusive of any other.’”
(citation omitted)); accord Richardson Constr., Inc. v. Clark
County Sch. Dist., 156 P.3d 21, 23 (Nev. 2007) (“[W]hen a
statute provides an express remedy, courts should be
cautious about reading additional remedies into the
statute.”).

TOBLER V. SABLES 9

Here, all of the Toblers’ claims rest on Defendants’
asserted failure to comply with the various requirements of
the foreclosure mediation program, and these claims could
have been raised in a timely request for review under the
Foreclosure Mediation Rules. Accordingly, the Toblers’
exclusive remedy under Nevada law for addressing these
deficiencies was a timely request for judicial review filed
within the applicable 10-day period set forth in Nevada
F.M.R. 20(2).
4
As a result, the district court correctly held
that the Toblers’ state common-law claims and related
requests for declaratory and injunctive relief failed to state a
claim upon which relief could be granted. See Fed. R. Civ.
P. 12(b)(6). We therefore affirm the district court’s
dismissal of the Toblers’ action.
AFFIRMED.

4
Because the Toblers do not contend that Defendants engaged in
fraud during the mediation process, we have no occasion to address
whether Nevada law would permit a separate action asserting a common-
law claim for fraud in that distinct context. Cf. Nationstar Mortg.,
375 P.3d at 1029 n.2 (suggesting in dicta that such an action might be
appropriate). Here, the Toblers’ claims rest on precisely the sorts of
issues that the mediation program requires a party to raise during the
mediation process itself.