McNair v. Maxwell & Morgan PC et al

Filing 37

ORDER denying 12 Defendant's Motion to Dismiss and granting 16 Defendant's Motion to Strike 14 Friend of Court Notice. Mr. Ticktin is barred from submitting any further filings in this proceeding. Signed by Judge David G Campbell on 8/26/14.(LSP)

Download PDF
1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Martha A. McNair, No. CV-14-00869-PHX-DGC Plaintiff, 10 11 v. 12 ORDER Maxwell & Morgan PC, et al., 13 Defendants. 14 15 Defendant W. William Nikolaus has filed a motion to dismiss pursuant to Federal 16 Rules of Civil Procedure 12(b)(1) and 12(b)(6). Doc. 12. For the reasons set forth 17 below, the Court will deny the motion.1 18 Defendant has also filed a motion to strike Phillip Ticktin’s “friend of the court” 19 brief. Doc. 16. The motion is fully briefed and no party has requested oral argument. 20 The Court will deny the motion. 21 I. Defendant’s Motion to Dismiss. 22 A. 23 Plaintiff alleges that on August 3, 2004 she acquired real property located at 1144 24 East Temple Court in Gilbert, Arizona (the “Property”). Doc. 1, ¶ 9. The Property is part 25 of the Neely Commons Phase 1 subdivision and is subject to a declaration of covenants, Background. 26 27 1 28 The request for oral argument is denied because the issues have been fully briefed and oral argument will not aid the Court’s decision. See Fed. R. Civ. P. 78(b); Partridge v. Reich, 141 F.3d 920, 926 (9th Cir. 1998). 1 conditions, and restrictions, which includes an obligation on the Property owner to pay 2 assessments to the Neely Commons HOA (the “HOA”), which total about $450.00 3 annually. Id., ¶ 10. 4 Defendants named in Plaintiff’s complaint represented the HOA in its efforts to 5 collect HOA fees from Plaintiff. 6 represented the HOA. On December 21, 2009, Defendants filed suit in Maricopa County 7 Highland Justice Court on behalf of the HOA seeking to recover $697 in unpaid HOA 8 fees (the “First Lawsuit”). Id., ¶ 12. Plaintiff was not represented by counsel. Id., ¶ 13. 9 In November 2010, Defendants obtained a judgment in the First Lawsuit for $1,466.80, 10 Defendant Nikolaus is one of the lawyers who which included costs, attorney’s fees, and unpaid HOA fees. Id., ¶ 14. 11 On April 30, 2012, Defendants filed a second suit in Maricopa County Superior 12 Court on behalf of the HOA seeking to foreclose Plaintiff’s interest in the Property and to 13 recover $4,027.24 of allegedly unpaid HOA fees. Id., ¶ 15. On June 27, 2012, Plaintiff 14 and Defendants signed a document entitled “Stipulation for Judgment on Foreclosure” 15 (the “Stipulation”) and lodged a proposed order approving the stipulation. Id., ¶ 17. The 16 Stipulation provided that the HOA would not execute on any judgment if Plaintiff made 17 an initial payment of $2,500 by July 5, 2012 and if she made 12 monthly payments of 18 $250 thereafter until the Judgment was paid in full. Id., ¶ 20. On July 12, 2012, the 19 Superior Court accepted the Stipulation. Id., ¶ 18. Plaintiff alleges that the Stipulation 20 included numerous provisions that are contrary to Arizona law, including a reduction of 21 Plaintiff’s statutory redemption period from six months to 30 days, a waiver of Plaintiff’s 22 personal property exemptions under A.R.S. § 33-1121 et seq., which is statutorily 23 prohibited by A.R.S. § 33-1132, an authorization to evict Plaintiff without adherence to 24 Arizona law, and an award of future assessments, attorneys’ fees, and costs. Id., ¶ 32. 25 Plaintiff alleges that she made the first 11 payments totaling $5,000. Id., ¶ 22. In 26 May 2013, after making her eleventh payment, Plaintiff submitted a letter requesting a 27 written statement of the balance owed under the Stipulation. Id., ¶ 23. Defendants did 28 not respond to Plaintiff’s letter until August 2013, and even then did not tell Plaintiff the -2- 1 balance that remained to be paid. Id., ¶ 26. Instead, they mailed her a copy of the 2 Stipulation and asked her what she planned to do going forward. Id. In September 2013, 3 Plaintiff again requested a statement of her account. Id., ¶ 27. Defendants again refused 4 to provide a statement of the account. Id., ¶ 28. As a result, Plaintiff tendered payment 5 of $275.74, which she believed was more than what was required under the Stipulation. 6 Id. Notwithstanding Plaintiff’s payment, Defendants treated the Stipulation as if it had 7 been breached and sought to execute on Plaintiff’s property. Id., ¶ 29. 8 On November 6, 2013, Defendants obtained a writ of special execution relating to 9 the Stipulation to have the Property sold at a sheriff’s sale. Id., ¶ 30. The writ of special 10 execution was exclusively drafted by Defendants, included amounts not owed under the 11 Stipulation, and did not credit all previous payments made by Plaintiff under the 12 Stipulation. Id., ¶¶ 34-36. On January 9, 2014, the Maricopa County Sheriff conducted a 13 sheriff’s sale and sold the property. Id., ¶ 37. 14 15 16 17 Plaintiff instituted this action on April 24, 2014, alleging that Defendants’ actions violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq. (“FDCPA”). B. Legal Standard. 1. Rule 12(b)(1): Subject Matter Jurisdiction. 18 The defense of lack of subject matter jurisdiction may be raised at any time by the 19 parties or the Court. See Fed. R. Civ. P. 12(h)(3); Augustine v. United States, 704 F.2d 20 1074, 1077 (9th Cir. 1983). “A Rule 12(b)(1) jurisdictional attack may be facial or 21 factual.” Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004); see 22 Thornhill Publ’g Co. v. Gen. Tel. & Elecs., 594 F.2d 730, 733 (9th Cir. 1979). “In a 23 facial attack, the challenger asserts that the allegations contained in the complaint are 24 insufficient on their face to invoke federal jurisdiction. By contrast, in a factual attack, 25 the challenger disputes the truth of the allegations that, by themselves, would otherwise 26 invoke federal jurisdiction.” Safe Air for Everyone, 373 F.3d at 1039. In resolving a 27 factual attack on jurisdiction, the Court “may review evidence beyond the complaint 28 without converting the motion to dismiss to a motion for summary judgment.” Id.; see -3- 1 Augustine, 704 F.2d at 1077. 2 2. Rule 12(b)(6): Failure to State a Claim. 3 When analyzing a complaint for failure to state a claim under Rule 12(b)(6), the 4 well-pled factual allegations are taken as true and construed in the light most favorable to 5 the nonmoving party. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). Legal 6 conclusions couched as factual allegations are not entitled to the assumption of truth, 7 Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009), and therefore are insufficient to defeat a 8 motion to dismiss for failure to state a claim, In re Cutera Sec. Litig., 610 F.3d 1103, 9 1108 (9th Cir. 2010). To avoid a Rule 12(b)(6) dismissal, the complaint must plead 10 enough facts to state a claim to relief that is plausible on its face. Bell Atl. Corp. v. 11 Twombly, 550 U.S. 544, 570 (2007). 12 ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant 13 has acted unlawfully.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 556). 14 “[W]here the well-pleaded facts do not permit the court to infer more than the mere 15 possibility of misconduct, the complaint has alleged – but it has not ‘show[n]’ – ‘that the 16 pleader is entitled to relief.’” Id. at 679 (quoting Fed. R. Civ. P. 8(a)(2)). 17 18 C. This plausibility standard “is not akin to a Analysis. 1. Subject Matter Jurisdiction. 19 Defendant Nikolaus argues that Plaintiff’s claims were previously argued and 20 adjudicated in state court. Doc. 12 at 15. Defendant asserts that this Court therefore 21 lacks subject matter jurisdiction pursuant to the Rooker-Feldman doctrine. Id. 22 The Rooker-Feldman doctrine takes its name from Rooker v. Fidelity Trust 23 Co., 263 U.S. 413 (1923), and District of Columbia Court of Appeals v. Feldman, 24 460 U.S. 462 (1983). Under Rooker-Feldman, a federal district court does not have 25 subject matter jurisdiction to hear a direct appeal from the final judgment of a state court. 26 See Feldman, 460 U.S. at 482; Rooker, 263 U.S. at 415-16. 27 28 In its routine application, the Rooker-Feldman doctrine is exceedingly easy. A party disappointed by a decision of a state court may seek reversal of that decision by appealing to -4- 1 7 a higher state court. A party disappointed by a decision of the highest state court in which a decision may be had may seek reversal of that decision by appealing to the United States Supreme Court. In neither case may the disappointed party appeal to a federal district court, even if a federal question is present or if there is diversity of citizenship between the parties. Rooker-Feldman becomes difficult—and, in practical reality, only comes into play as a contested issue—when a disappointed party seeks to take not a formal direct appeal, but rather its de facto equivalent, to a federal district court. 8 Noel v. Hall, 341 F.3d 1148, 1155 (9th Cir. 2003). Examples of a “de facto equivalent” 9 to which Rooker-Feldman applies include naming a state superior court as a federal 10 defendant and alleging as a legal wrong that the state court’s jury verdict was 11 unconstitutional, Worldwide Church of God v. McNair, 805 F.2d 888 (9th Cir. 1986); 12 naming each judge from a state appellate panel as a federal defendant and alleging a 13 federal due process violation that effectively seeks to have the appellate panel’s opinion 14 vacated, Bianchi v. Rylaarsdam, 334 F.3d 895 (9th Cir. 2003); filing suit in federal court 15 and asserting as a legal wrong the allegedly incorrect jurisdictional determinations of a 16 state agency and the reviewing state court, Olson Farms v. Barbosa, 134 F.3d 933 (9th 17 Cir. 1998); naming as defendants in a federal action the justices of a state supreme court 18 and alleging that the justices violated the constitution by levying and collecting a fine, 19 Partington v. Gedan, 961 F.2d 852 (9th Cir. 1992); alleging a constitutional violation in 20 federal court when a state court dismissed a lawsuit for failure to comply with a 21 discovery order, Allah v. Superior Court, 871 F.2d 887 (9th Cir. 1989); filing suit in 22 federal court seeking to void a state default judgment because the state court allegedly 23 lacked personal jurisdiction, MacKay v. Pfeil, 827 F.2d 540 (9th Cir. 1987); filing suit in 24 federal district court to challenge a state supreme court decision to deny admission to the 25 state bar, Tofano v. Supreme Court of Nev., 718 F.2d 313 (9th Cir. 1983). 2 3 4 5 6 26 The Rooker-Feldman doctrine does not apply to this case. Plaintiff does not seek 27 review of a state court decision and she does not seek its de facto equivalent. See 28 Vacation Vill., Inc. v. Clark Cnty., Nev., 497 F.3d 902, 907 (9th Cir. 2007) (“Rooker- -5- 1 Feldman applies only when the federal plaintiff both asserts as her injury legal error or 2 errors by the state court and seeks as her remedy relief from the state court judgment.”) 3 (internal quotation marks and citation omitted) (emphasis in original). Instead, she raises 4 claims that Defendant asserts have been previously litigated. Rooker-Feldman, collateral 5 estoppel, and res judicata are separate and distinct doctrines. The Court cannot conclude 6 that it lacks subject matter jurisdiction over Plaintiff’s federal statutory claim. 7 8 2. Failure to State a Claim. a. Statute of Limitations. 9 Defendant argues that Plaintiff is barred from recovering on three alleged 10 violations of the FDCPA (see Doc. 1, ¶ 42 at (i)-(iii)) by a one-year statute of limitations. 11 Doc. 12 at 7; see 15 U.S.C. § 1692k(d) (imposing a one-year limitations period for 12 FDCPA violations). Defendant asserts that each event listed in parts (i), (ii), and (iii) of 13 paragraph 42 of Plaintiff’s complaint occurred approximately two years before Plaintiff 14 filed suit. Doc. 12 at 7-8. Plaintiff responds that her FDCPA claims did not accrue until 15 foreclosure of her property commenced November 6, 2013, which is well within one-year 16 of her April 24, 2014 filing date. Doc. 27 at 7. In the alternative, Plaintiff argues that the 17 FDCPA violations are ongoing and that the statute of limitations is therefore tolled. Id. 18 A motion to dismiss based on the running of the statute of limitations may be 19 granted only if it appears beyond doubt that the plaintiff can prove no set of facts that 20 would establish the timeliness of the claim. Supermail Cargo, Inc. v. U.S., 68 F.3d 1204, 21 1207 (9th Cir. 1995) (citations omitted). To determine when a limitations period began 22 to run, the Court must apply the discovery rule. “Federal law determines when the 23 limitations period begins to run, and the general federal rule is that a limitations period 24 begins to run when the plaintiff knows or has reason to know of the injury which is the 25 basis of the action.” Mangum v. Action Collection Serv., Inc., 575 F.3d 935, 940 (9th Cir. 26 2009) (internal quotation marks and citations omitted). 27 When “the conduct complained of constitutes a continuing pattern and course of 28 conduct as opposed to unrelated discrete acts,” the suit is timely “if the action is filed -6- 1 within one year of the most recent date on which the defendant is alleged to have violated 2 the FDCPA and the entire course of conduct is at issue.” Joseph v. J.J. Mac Intyre Cos., 3 L.L.C., 281 F. Supp. 2d 1156, 1161 (N.D. Cal. 2003) (internal quotation marks and 4 citation omitted). Plaintiff alleges that Defendant Nikolaus and his co-parties employed a 5 progressive series of unfair and unconscionable tactics to collect an alleged debt that 6 spanned from April 30, 2012 until about September 2013. Doc. 1, ¶¶ 41-42. The Court 7 cannot conclude at this time that Plaintiff can prove no set of facts that would establish 8 the timeliness of her claims. 9 b. Implausible Claims. 10 Plaintiff alleges that Defendant included amounts not owed under the Stipulation 11 in a writ of special execution, including, but not limited to, costs, attorneys’ fees, 12 assessments, interest, and late fees. Doc. 1, ¶ 34-35. Defendant Nikolaus argues that the 13 Stipulation expressly includes every category of expense that Plaintiff contends 14 Defendant unfairly and wrongly included in the writ of special execution. Doc. 12 at 8-9. 15 In support of their argument, Defendant appears to quote the first paragraph of the 16 Stipulation, but neither party has provided the Court with a copy of the Stipulation. 17 Because Plaintiff referred to the Stipulation extensively in her pleadings, the Court would 18 normally consider the Stipulation in ruling on the motion to dismiss. See Knievel v. 19 ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005). Defendant Nikolaus has not, however, 20 provided the Court with an opportunity to examine the Stipulation by attaching the 21 document to his filings. The Court cannot rely on the segment Defendant has excerpted 22 from the Stipulation without consulting the entire document. 23 Defendant also argues that no FDCPA violation arises from Defendants’ alleged 24 failure to respond to Plaintiff’s balance requests in May and September 2013, particularly 25 in light of the fact that Plaintiff’s balance requests received responses in August 2013 and 26 November 2013 respectively. Doc. 12 at 10. The Court concludes that Plaintiff’s 27 complaint plausibly alleges violations of the FDCPA, which prohibits debt collectors 28 from using the following tactics to collect a debt: making a “false representation of the -7- 1 character, amount, or legal status of any debt,” 15 U.S.C. § 1692e(2)(A); using any “false 2 representation or deceptive means to collect or attempt to collect any debt,” 15 U.S.C. 3 § 1692e(10); and using any “false representation or implication that documents . . . do not 4 require action by the consumer,” 15 U.S.C. § 1692e(15). 5 whether a communication violates section 1692e is an objective standard based on the 6 “least sophisticated consumer,” which protects the “naïve and trusting” consumer while 7 shielding debt collectors “against liability for bizarre or idiosyncratic interpretations of 8 collection notices.” Isham v. Gurstel, Staloch & Chargo, P.A., 738 F. Supp. 2d 986, 995 9 (D. Ariz. 2010) (citations omitted). The least sophisticated consumer could plausibly 10 interpret the defendants’ silence and delayed responses as an implication that there were 11 no amounts due under the Stipulation or that Plaintiff did not need to take any action to 12 satisfy her obligations under the Stipulation. That implication was false and had the 13 potential to trigger liability that was much greater than the amount remaining due under 14 the Stipulation. c. 15 16 The test for determining Res Judicata and Collateral Estoppel. Defendant argues that Plaintiff’s complaint is nothing more than an attempt to 17 relitigate claims and issues previously adjudicated in state court. 18 Defendant asserts that Plaintiff’s claims are barred by both res judicata and collateral 19 estoppel. 20 Stipulation, which was decided by the state court; rather, she is challenging the debt 21 collection practices utilized by Defendants that were not challenged in state court. 22 Doc. 27 at 13. Id. Doc. 12 at 11. Plaintiff responds that she is not challenging her liability under the 23 “Under the doctrine of res judicata, a judgment on the merits in a prior suit bars a 24 second suit involving the same parties or their privies based on the same cause of action. 25 Under the doctrine of collateral estoppel, on the other hand, the second action is upon a 26 different cause of action and the judgment in the prior suit precludes relitigation of issues 27 actually litigated and necessary to the outcome of the first action.” Collins v. D.R. 28 Horton, Inc., 505 F.3d 874, 880 n.5 (9th Cir. 2007) (quoting Parklane Hosiery Co.v. -8- 1 Shore, 439 U.S. 322, 326-27 n.5 (1979)). 2 The Court is not convinced at this time that either res judicata or collateral 3 estoppel applies. Defendant has failed to attach a copy of any state court ruling that 4 might enable the Court to determine what issues were determined in a previous 5 proceeding involving these parties. In addition, Defendant’s brief suggests that the state 6 court action centered on whether the Stipulation was enforceable and whether Defendants 7 were legally entitled to foreclose on Plaintiff’s property. See Doc. 12 at 13. It does not 8 appear from Plaintiff’s complaint or Defendant’s briefing that the state court determined 9 whether the debt collection practices utilized by Defendants violated the FDCPA. 10 II. Defendant’s Motion to Strike. 11 On June 24, 2014, Philip Ticktin filed a document entitled “Friend of the Court.” 12 Doc. 14. In the document Mr. Ticktin expresses a desire to aid the Court in its “dealings 13 with Maxwell & Morgan” who Mr. Ticktin claims are CIA affiliated attorneys involved 14 in illegal drug operations at the CIA’s direction. Id. at 1-2. Mr. Ticktin’s response brief 15 is also peppered with surprising allegations of Maxwell & Morgan’s misconduct that 16 have nothing to do with the merits of this case, including an allegation that proceeds from 17 Maxwell & Morgan’s drug operations help effectuate CIA black operations independent 18 of congressional oversight (Doc. 20 at 1), an allegation suggesting that the CIA is 19 responsible for the untimely death of Judge John Roll (id. at 2), an allegation that Mr. 20 Ticktin has compiled enough evidence against Maxwell & Morgan to institute a RICO 21 prosecution (id.), and even an allegation that Mr. Ticktin would have been assassinated 22 but for the fact that he is related to the founder of CBS who was a lifelong member of the 23 OSS, CIA, and the Pennsylvania Illuminati (id.). 24 Defendant moves to strike Mr. Ticktin’s “Friend of the Court” brief pursuant to 25 Federal Rule of Civil Procedure 11(b) and Local Rule 7.2(m). Doc. 16 at 1. Defendant 26 argues that Mr. Ticktin’s brief is frivolous and filed for the purpose of harassment. 27 Doc. 16 at 1. Because Mr. Ticktin is not a party to the lawsuit and has no right or 28 procedural basis to file anything in this case, Defendant asserts that the Court should -9- 1 strike his brief. Id. Mr. Ticktin’s only response is that Defendant has not denied the truth 2 of his allegations and that the Court should cooperate in his efforts to expose Maxwell & 3 Morgan’s true nature. Doc. 20 at 2. 4 The Court will grant Defendant’s motion. Mr. Ticktin’s filings are immaterial, 5 impertinent, and scandalous. The Court will also enter an order that he submit no further 6 filings in this proceeding. 7 IT IS ORDERED: 8 1. Defendant’s motion to dismiss (Doc. 12) is denied. 9 2. Defendant’s motion to strike (Doc. 16) is granted. 10 3. Mr. Ticktin is barred from submitting any further filings in this proceeding. 11 Dated this 26th day of August, 2014. 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 10 -

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?