Opinion
C/A No.: 6:19-cv-02161-BHH-KFM
09-19-2019
Stephen A. Clements, Plaintiff, v. The Bank of New York Mellon, Defendant.
REPORT OF MAGISTRATE JUDGE
The plaintiff, proceeding pro se, filed the instant action alleging violations of federal law due to a foreclosure action filed by the defendant against him. Pursuant to the provisions of 28 U.S.C. § 636(b) and Local Civil Rule 73.02(B)(2)(e) (D.S.C.), this magistrate judge is authorized to review all pretrial matters in this case and submit findings and recommendations to the district court.
The plaintiff filed this case against the defendant on August 2, 2019 (doc. 1). By Order filed on August 7, 2019, the plaintiff was informed that his complaint was subject to summary dismissal because it fails to state a claim upon which relief may be granted (doc. 8). In the same Order, the plaintiff was informed that he could attempt to cure the defects in his complaint by filing an amended complaint within fourteen days (doc. 8 at 7-8). The plaintiff was informed that if he failed to file an amended complaint or cure the deficiencies outlined in the Order, the undersigned would recommend that his claims be dismissed (id.). The plaintiff has failed to file an amended complaint within the time provided; accordingly, the undersigned recommends that the instant matter be dismissed.
BACKGROUND
This case arises from a state foreclosure action (2018-CP-23-04940) filed against the plaintiff by the defendant, The Bank of New York Mellon ("state foreclosure action"). The court takes judicial notice of the state foreclosure action filed in the Greenville County Court of Common Pleas. See The Bank of New York Mellon, et al. v. Clements, et al., C/A No. 2018-CP-23-04940, Greenville County Public Index, https://www2.greenvillecounty.org/SCJD/ PublicIndex/PISearch.aspx (enter the plaintiff's name and 2018-CP-23-04940) (last visited September 9, 2019). In the instant action, the plaintiff, dissatisfied with the way the state foreclosure action proceeded, seeks damages from the defendant for its alleged violation of several federal laws, including: Federal Protection Act, Federal Debt Collections Practices Act, Federal Consumer Financial Law, Protecting Tenant from Foreclosure Act, Truth in Lending Act ("TILA"), Regulation Z (12 C.F.R. § 1026), Home Ownership & Equity Protection Act, Mortgage Disclosure Improvement Act, and the Electronic Signatures in Global and National Commerce Act (doc. 1 at 1-2).
Phillips v. Pitt Cty. Mem. Hosp., 572 F.3d 176, 180 (4th Cir. 2009) (courts "may properly take judicial notice of matters of public record."); Colonial Penn Ins. Co. v. Coil, 887 F.2d 1236, 1239 (4th Cir. 1989) ("We note that '[t]he most frequent use of judicial notice . . . is in noticing the content of court records.'").
In essence, the plaintiff alleges that the defendant (who is not the original mortgage holder) did not have standing to pursue the state foreclosure action against the plaintiff (id.). The plaintiff contends that there was another foreclosure action filed by this defendant in 2015 that was dismissed, and the plaintiff asserts that due to that prior action, the defendant was barred from filing the state foreclosure action by res judicata (id. at 3-4). The plaintiff also asserts that he has been defrauded by the collusion and civil conspiracy the defendant engaged in and that he was not well-represented in the state foreclosure action because of malpractice by Attorney Alan Stewart (although Mr. Stewart is not identified in the state court filings/docket) (id. at 4). The plaintiff contends that the loan is predatory and charges an interest rate in excess of that allowed for by law, violates TILA by its own terms/vagueness, that he was never given documentation required by Regulation Z, and that he was never given a notice of right to cure (id. at 4-5).
Review of the judicially noticed documents in the state foreclosure action indicates that the case was disposed by non-jury on June 21, 2019, with a judgment of foreclosure entered on July 24, 2019, and the docket reflects that the defendant purchased the property on August 5, 2019, with an order on sale of real estate entered by the Master in Equity on August 22, 2019. See The Bank of New York Mellon, et al. v. Clements, et al., C/A No. 2018-CP-23-04940, Greenville County Public Index.
For relief, the plaintiff seeks a temporary restraining order and preliminary injunction (presumably to prevent the execution of the foreclosure and sale of the property) (id. at 6). The plaintiff also seeks rescission of the foreclosure, money damages, the right to ownership of the property, a termination of the defendant's interest in the plaintiff's property, and a return of funds that were in his escrow account (id.).
STANDARD OF REVIEW
The plaintiff is a pro se litigant and his pleadings are accorded liberal construction and held to a less stringent standard than formal pleadings drafted by attorneys. See Erickson v. Pardus, 551 U.S. 89 (2007) (per curiam). The requirement of liberal construction, however, does not mean that the Court can ignore a clear failure in the pleading to allege facts which set forth a claim cognizable in a federal district court. See Weller v. Dep't of Soc. Servs., 901 F.2d 387, 391 (4th Cir. 1990).
"The Federal Rules of Civil Procedure recognize that courts must have the authority to control litigation before them." Ballard v. Carlson, 882 F.2d 93, 95 (4th Cir. 1989) (citing Fed. R. Civ. P. 41(b)). Federal courts are courts of limited jurisdiction, "constrained to exercise only the authority conferred by Article III of the Constitution and affirmatively granted by federal statute." In re Bulldog Trucking, Inc., 147 F.3d 347, 352 (4th Cir. 1998). Since federal courts have limited subject matter jurisdiction, there is no presumption that the court has jurisdiction. Pinkley, Inc. v. City of Frederick, 191 F.3d 394, 399 (4th Cir. 1999) (citing Lehigh Mining & Mfg. Co. v. Kelly, 160 U.S. 337 (1895)). Accordingly, a federal court is required, sua sponte, to determine if a valid basis for its jurisdiction exists, "and to dismiss the action if no such ground appears." Bulldog Trucking, 147 F.3d at 352; see also Fed. R. Civ. P. 12(h)(3) ("If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action.").
DISCUSSION
As noted above, the plaintiff filed this action seeking damages from the defendant as a result of the state foreclosure action (doc. 1). For the reasons that follow, the instant matter is subject to summary dismissal.
State Foreclosure Action
The plaintiff filed this action seeking damages from the defendant as a result of the state foreclosure action (doc. 1). The plaintiff's complaint, however, is subject to summary dismissal because, under the Rooker-Feldman doctrine, this Court is without jurisdiction over this action. Weathers v. Pou, No. 2:09-cv-270-JFA-RSC, 2009 WL 1139984, at *2 (D.S.C. Apr. 27, 2009).
The Rooker-Feldman Doctrine gets its name from two cases decided by the United States Supreme Court finding that the district court lacks subject matter jurisdiction over cases brought by state-court losers complaining of injuries caused by state-court judgments where the district court is requested to review and reject those judgments. See District of Columbia Court of Appeals v. Feldman, 460 U.S. 462 (1983); Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923).
The Rooker-Feldman doctrine is jurisdictional and may be raised by the Court sua sponte. Am. Reliable Ins. Co. v. Stillwell, 336 F.3d 311, 316 (4th Cir. 2003). "[T]he Rooker-Feldman doctrine applies . . . when the loser in state court files suit in federal district court seeking redress for an injury allegedly caused by the state court's decision itself." Davani v. Virginia Dep't of Transp., 434 F.3d 712, 713 (4th Cir. 2006). Here, the plaintiff asserts his claims with this Court because he is dissatisfied with the proceedings in the state foreclosure action and seeks, in essence, an order from this court overturning the final order/judgment of foreclosure in the state foreclosure action (see generally doc. 1). It is well-settled, however, that the Rooker-Feldman doctrine applies to bar the exercise of federal jurisdiction even when a challenge to state court decisions or rulings concerns federal constitutional issues; instead, only the United States Supreme Court may review those state-court decisions. See D.C. Ct. of Appeals v. Feldman, 460 U.S. 462, 476-82 (1983) (a federal district court lacks authority to review final determinations of state or local courts because such review can be conducted only by the Supreme Court of the United States under 28 U.S.C. § 1257); Davani, 434 F.3d at 719 (explaining how the expansive interpretation of the Rooker-Feldman doctrine was limited by Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280 (2005)); see also Dukes v. Stone, C.A. No. 3:08-cv-505-PMD-JRM, 2009 WL 398079, at *4 (D.S.C. Feb. 17, 2009) (explaining that only the United States Supreme Court is empowered with appellate authority to reverse or modify a state court judgment).
The doctrine applies even if the state court litigation has not reached a state's highest court. See Worldwide Church of God v. McNair, 805 F.2d 888, 892-93 & nn.3-4 (9th Cir. 1986); see also 28 U.S.C. § 1738 (providing that a federal court must accord full faith and credit to a state court judgment); Robart Wood & Wire Prods. Corp. v. Namaco Indus., 797 F.2d 176, 178 (4th Cir. 1986); Anderson v. Colorado, 793 F.2d 262, 263 (10th Cir. 1986) ("It is well settled that federal district courts are without authority to review state court judgments where the relief sought is in the nature of appellate review."); Hagerty v. Succession of Clement, 749 F.2d 217, 219-20 (5th Cir. 1984) (collecting cases).
Even liberally construing the complaint, to rule in favor of the plaintiff in the present action would necessarily require this court to overrule, or otherwise find invalid, the state foreclosure action order/judgment. Cf. In re Genesys Data Tech., Inc., 204 F.3d 124, 127 (4th Cir. 2000) (noting that pursuant to 28 U.S.C. § 1738 all federal courts must give full faith and credit to valid state court judgments). Further, the plaintiff's request that the court terminate the defendant's interest in his property and rescind the state foreclosure action is prohibited under the Rooker-Feldman doctrine. See Auto-Owners Ins. Co. v. Tuggle, 289 F. Supp. 2d 1061, 1067 (W.D. Ark. 2003) (finding that Rooker-Feldman barred suit because "any such findings would be in direct conflict with and undermine one of the state court judgments"). As such, the instant action is subject to summary dismissal for lack of subject matter jurisdiction because of the Rooker-Feldman doctrine.
Violations of Federal Statutes
To the extent the plaintiff's claims can be construed as independent from and not inextricably intertwined with the state court's judgment in the foreclosure proceedings, his complaint fails to state a claim for relief. In his complaint, the plaintiff alleges various irregularities in the Note and foreclosure proceedings, as well as that the defendant lacked standing to foreclose on his property (see generally doc. 1). The plaintiff also alleges violations of assorted federal statutes and regulations, including (1) the Federal Protection Act, (2) the Federal Debt Collections Practices Act, (3) the Federal Consumer Financial Law, (4) the Protecting Tenant from Foreclosure Act, (5) TILA, (6) Regulation Z (12 C.F.R. § 1026), (7) the Home Ownership & Equity Protection Act, (8) the Mortgage Disclosure Improvement Act, and (9) the Electronic Signatures in Global and National Commerce Act (doc. 1). These alleged violations, however, could have been presented in the state foreclosure action, and the plaintiff presents nothing to suggest otherwise. Further, although the plaintiff contends that the loan "itself" violates TILA and Regulation Z, he has provided no plausible factual allegations to support his conclusory assertion. Moreover, with respect to the remaining federal statutes identified in the plaintiff's complaint, the complaint's allegations are vague and conclusory in nature. As such, they fail to state a claim for relief as plead and are subject to summary dismissal.
Indeed, a review of judicially noticed documents in the state foreclosure action indicate that the plaintiff never answered or participated in the state foreclosure action and was held in default. See The Bank of New York Mellon, et al. v. Clements, et al., C/A No. 2018-CP-23-04940, Greenville County Public Index.
RECOMMENDATION
By order issued August 7, 2019, the undersigned gave the plaintiff an opportunity to correct the defects identified in his complaint and further warned the plaintiff that if he failed to file an amended complaint or failed to cure the identified deficiencies, the undersigned would recommend to the district court that the action be dismissed with prejudice and without leave for further amendment. The plaintiff failed to file an amended complaint within the time provided. Accordingly, in addition to the reasons discussed herein, this action should be dismissed pursuant to Federal Rule of Civil Procedure 41(b) for failure to comply with a court order. Therefore, the undersigned recommends that the district court dismiss this action with prejudice and without issuance and service of process. See Workman v. Morrison Healthcare, 724 F. App'x 280, 281 (4th Cir. 2018) (in a case where the district court had already afforded the plaintiff an opportunity to amend, directing the district court on remand to "in its discretion, either afford [the plaintiff] another opportunity to file an amended complaint or dismiss the complaint with prejudice, thereby rendering the dismissal order a final, appealable order") (citing Goode v. Cent. Va. Legal Aid Soc'y, Inc., 807 F.3d 619, 630 (4th Cir. 2015)). The plaintiff's attention is directed to the important notice on the next page.
IT IS SO RECOMMENDED.
s/ Kevin F. McDonald
United States Magistrate Judge September 19, 2019
Greenville, South Carolina
Notice of Right to File Objections to Report and Recommendation
The parties are advised that they may file specific written objections to this Report and Recommendation with the District Judge. Objections must specifically identify the portions of the Report and Recommendation to which objections are made and the basis for such objections. "[I]n the absence of a timely filed objection, a district court need not conduct a de novo review, but instead must 'only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.'" Diamond v. Colonial Life & Acc. Ins. Co., 416 F.3d 310 (4th Cir. 2005) (quoting Fed. R. Civ. P. 72 advisory committee's note).
Specific written objections must be filed within fourteen (14) days of the date of service of this Report and Recommendation. 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b); see Fed. R. Civ. P. 6(a), (d). Filing by mail pursuant to Federal Rule of Civil Procedure 5 may be accomplished by mailing objections to:
Robin L. Blume, Clerk
United States District Court
300 East Washington Street, Room 239
Greenville, South Carolina 29601
Failure to timely file specific written objections to this Report and Recommendation will result in waiver of the right to appeal from a judgment of the District Court based upon such Recommendation. 28 U.S.C. § 636(b)(1); Thomas v. Arn, 474 U.S. 140 (1985); Wright v. Collins, 766 F.2d 841 (4th Cir. 1985); United States v. Schronce, 727 F.2d 91 (4th Cir. 1984).