Nazie Azam v. Bank of America, National Association et al

Filing 74

MINUTES (IN CHAMBERS) by Judge David O. Carter: Order Denying Motion to Disqualify 63 . (mt)

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SA CV 12-1732-JLS (MLGx)

Date: June 19, 2014

Title: NAZIE AZAM V. BANK OF AMERICA, N.A., ET AL.

PRESENT: THE HONORABLE DAVID O. CARTER, JUDGE
Julie Barrera
Courtroom Clerk

Not Present
Court Reporter

ATTORNEYS PRESENT FOR
PLAINTIFF:
None Present

ATTORNEYS PRESENT FOR
DEFENDANT:
None Present

PROCEEDINGS (IN CHAMBERS): ORDER DENYING MOTION TO
DISQUALIFY [63]
Plaintiff Nazie Azam (“Azam”) moves to disqualify Judge Josephine L. Staton in
the matter of Nazie Azam v. Bank of America, Nat’l Ass’n et al., 8:12-cv-01732-JLS
(MLG). Azam moves for recusal under 28 U.S.C. § 455, 28 U.S.C. § 47, and the
Fourteenth Amendment to the U.S. Constitution. See Mot. at 15-19. The Court finds this
matter appropriate for determination without oral argument. See Fed. R. Civ. P. 78; L.R.
7-15. After considering the moving papers and the entirety of the record, the Court
DENIES Azam’s motion.
I.

Background

The Court provides this background to outline the general allegations underlying
Azam’s arguments. Azam has provided a voluminous record and the allegations in the
related cases are lengthy. To the extent that specific arguments are not discussed in more
detail, the Court found such discussion unnecessary.
The complaint in the underlying case alleges a series of claims against Bank of
America that challenge the ownership of, foreclosure of, and unlawful detainer action
related to Azam’s real property. See Compl. (Dkt 1) ¶¶ 30-64. The complaint brings

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CENTRAL DISTRICT OF CALIFORNIA
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Date: June 19, 2014
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seventeen causes of action. See id. at 23-38. Azam filed an initial ex parte application
for a temporary restraining order on October 9, 2012 (Dkt. 3). Judge Staton denied the
application on October 11, 2012 (Dkt. 10). The Ninth Circuit affirmed in an unpublished
memorandum that became final on December 16, 2013. See Mandate (Dkt. 47).
Azam now moves to disqualify Judge Staton. The claimed basis for
disqualification is Judge Staton’s previous service as a judge on the Superior Court of
Orange County. The motion claims that Superior Court judges in Orange County receive
supplemental compensation from the county, which Judge Staton has received and may
continue to receive. This allegedly gives Judge Staton a financial interest in another case
that Plaintiff’s counsel filed in which Azam is a member of the putative class. The case
is Law Offices of Nina Ringgold and All Current Clients Thereof v. Jerry Brown et al.,
12-cv-717 (E.D. Cal.). Azam refers to this as the “VRA Case.”
Azam describes the VRA Case as “a class action complaint to challenge an
unconstitutional condition in the state court which necessarily mandated a forfeiture of
federal rights pertaining [to] racial equality.” Mot. at 4. The VRA Case arises out of a
California Court of Appeals decision holding that county-provided insurance and 401(k)
benefits for state judges violated the California Constitution. See Sturgeon v. Cnty. of
Los Angeles, 167 Cal. App. 4th 630, 644 (2008). The Court of Appeals held that the
benefits were “compensation,” which only the legislature could prescribe, and so any
county payment of “compensation” was an impermissible delegation of legislative power.
Id. at 657. Azam, and the VRA Case Complaint, claim that this decision renders
incapacitated all Superior Court judges who received such payments because the
California Constitution prohibits judges from “public employment or public office,” and
provides that “[a]cceptance of the public office is a resignation from the office of judge.”
See Cal. Const. art. VI § 17. Azam seems to posit that the Sturgeon court’s holding could
mean that some Superior Court judges may be forced to resign based on the county
benefits. The real heart of the VRA Case, however, seems to be that lawsuits heard by
those judges are void because the parties were not informed of this unconstitutional
judicial arrangement.
The VRA Case also hinges on a related piece of California legislation. On
February 20, 2009, the California legislature passed Section 5 of Senate Bill X2 11
(“SBX2 11”), which provided that “no governmental entity, or officer or employee of a
governmental entity, shall incur any liability . . . because of benefits provided to a judge
under the official action of a governmental entity . . . on the ground that those benefits

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 12-1732-JLS (MLGx)

Date: June 19, 2014
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were not authorized by law.” See VRA Case Compl, Ex. 4. Azam and the other VRA
Case plaintiffs appear to argue that SBX2 11 is an “unconstitutional retroactive immunity
provision” that unlawfully keeps Superior Court judges on the bench in violation of the
California Constitution. See Mot. at 7.
Azam and the VRA Case plaintiffs further argue that because all of the Los
Angeles and Orange County Superior Court judges are sitting unconstitutionally, litigants
have a right under the California Constitution to disclosure of the unconstitutional nature
of the proceedings and must give consent. See Mot. at 7 (quoting Cal. Const. art. VI §§
17, 21). Azam and the VRA Case plaintiffs appear to further argue that any proceedings
in which there was no disclosure or consent are somehow affected or void, including
Azam’s unlawful detainer.
Although Azam’s recusal arguments are somewhat befuddling to the Court, it
appears that they are related to some degree with the VRA Case and Judge Staton’s prior
role as a Superior Court judge.
II.

Discussion
a. 28 U.S.C. § 455(a)
i. Legal Standard

Under 28 U.S.C. § 455(a), “recusal is required if . . . [the judge’s] ‘impartiality
might reasonably be questioned.’” Cheney v. U.S. Dist. Court for Dist. of Columbia, 541
U.S. 913, 916 (2004). The fact that a judge made rulings adverse to a party, standing
alone, is not a basis for disqualification under Section 455. Liteky v. United States, 510
U.S. 540, 555 (1994); United States v. Hernandez-Escarsega, 886 F.2d 1560, 1581 (9th
Cir. 1989).
The substantive standard for recusal under 28 U.S.C. § 144 and 28 U.S.C. § 455 is
the same: “[W]hether a reasonable person with knowledge of all the facts would conclude
that the judge’s impartiality might reasonably be questioned.” United States v.
Hernandez, 109 F.3d 1450, 1453-54 (9th Cir. 1997) (per curiam) (quoting United States
v. Studley, 783 F.2d 934, 939 (9th Cir. 1986)) (internal quotation marks omitted).
Impermissible “personal bias” is generally a bias derived from extra-judicial origins, as
opposed to an opinion formed during the course of litigation. Craven v. United States, 22

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CENTRAL DISTRICT OF CALIFORNIA
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Date: June 19, 2014
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F.2d 605, 607 (1st Cir. 1927); accord United States v. Carigan, 600 F.2d 762, 763-64
(9th Cir. 1979).
Indeed, “opinions formed by the judge on the basis of facts introduced or events
occurring in the course of the current proceedings, or of prior proceedings, do not
constitute a basis for a bias or partiality motion unless they display a deep-seated
favoritism or antagonism that would make fair judgment impossible.” Liteky v. United
States, 510 U.S. 540, 555 (1994). More specifically, “judicial remarks during the course
of a trial that are critical or disapproving of, or even hostile to, counsel, the parties, or
their cases, ordinarily do not support a bias or partiality challenge.” Id. (noting that
“expressions of impatience, dissatisfaction, annoyance, and even anger” do not establish
bias, nor do “ordinary efforts at courtroom administration”).
ii. Analysis
The basis for Azam’s recusal motion are a bit unclear, but they appear to cover
roughly the following:
(1) even though Judge Staton is “aware of the VRA Case and its relationship to
this case,” all of Azam’s cases have been referred to Judge Staton;
(2) Judge Staton labeled “US Bank National Association, as Trustee, successor in
interest to Bank of America National Association as Trustee, as successor by merger to
LaSalle Bank National Association as Trustee for WaMu Mort” as a “real party in
interest defendant” on the docket for case no. 12-cv-1732, thereby making an improper
judicial determination of one of Azam’s arguments;
(3) Judge Staton denied Azam’s request for a TRO in the 12-cv-1732 case without
a hearing, dismissed the case until the motion for reconsideration, and did not rule on a
request to withdraw the reference;
(4) Judge Staton’s actions in the 12-cv-1732 case show “an administrative bias
predisposition”;
(5) Judge Staton allowed JPMorgan to participate in the 8:12-cv-1732 case despite
Azam’s claim that Bank of America is not an existing entity;

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CENTRAL DISTRICT OF CALIFORNIA
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(6) Judge Staton allowed counsel for “US Bank National Association, as Trustee,
successor in interest to Bank of America National Association as Trustee, as successor by
merger to LaSalle Bank National Association as Trustee for WaMu Mort” to appear in
the case even though “there is no formal appearance filed in this court approving this
representation,” see Mot. at 11;
(7) Judge Staton remanded to state court Azam’s removal of the unlawful detainer
based on federal rights Azam alleges cannot be enforced in state court “due to the conflict
between SBX2 11 and federal law and the United States Constitution,” (an issue in which
Judge Staton allegedly “has a direct interest”) see Mot. at 11, case no. 8:13-cv-633;
(8) In another case in which Azam was the plaintiff but the parties were otherwise
unrelated to any other case before Judge Staton, Judge Staton caused the cases to be
related such that the new case is now before her, see case no. 8:14-cv-226;
(9) Judge Staton denied a motion for withdrawal of the bankruptcy reference in
case no. 8:13-cv-1354, which involved an adversary proceeding raising the same SBX2
11 arguments against Azam’s unlawful detainer; and
(10) when the Ninth Circuit returned jurisdiction to the Bankruptcy Appellate
Panel to decide an appeal from a denial of a motion to reinstate Azam’s bankruptcy, see
case no. 8:14-0074, the district court opened a new case before the mandate issued and
then closed that case as “clerical error.”
In her analysis, Azam distills these allegations into two broad arguments for
disqualification under § 455. The first is premised on Judge Staton’s alleged personal or
financial interest in the outcome of Azam’s claims regarding the impact of Sturgeon and
SBX2 11 on Superior Court judges, disclosure, and consent. Specifically, Azam argues
that Judge Staton has “personal knowledge of disputed evidentiary facts relating to” the
proceedings before her, has a financial or general interest in Azam’s challenges based on
the failure to disclose to state court parties the alleged constitutional problems and to gain
their consent, and similarly has general and financial interest in the outcome of these
legal issues because they may impact both former and current state court judges like
Judge Staton. See Mot. at 15-16. Azam further alleges that Judge Staton has an
“unfavorable predisposition and view about” those people challenging SBX2 11 “who
publically state they shall seek a special judicial election under the voting rights act and

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challenge the public employment (which Judge Staton previously accepted) as
unconstitutional.” Mot. at 16-17.
The instant case raises none of the questions regarding SBX2 11 and the other
claims made in the VRA Case complaint. This Complaint only brings claims premised
on the unlawful detainer, and does not allege any of the VRA Case’s arguments. See
generally Compl. In fact, Judge Staton has never been in a position to rule on Azam’s
arguments on SBX2 11. Azam referenced these arguments in attempting to remove her
unlawful detainer, as in case no. 13-633, but the question before Judge Staton was not the
merits of the argument, but rather a procedural question of whether the questions
conferred federal removal jurisdiction. See 8:13-633 Order Remanding Case (Dkt. 15).
Similarly, although Azam included similar allegations in her motion to withdraw the
reference in 13-cv-1354, these allegations were entirely tangential to resolution of the
motion. See 8:13-1354 Order Denying Motion to Withdraw Reference (Dkt. 28). Rather,
Judge Staton’s determinations included that Azam consented to the Bankruptcy Court’s
jurisdiction over her adversary proceeding and that Azam’s motion was untimely. See id.
Therefore, even if the Court were to credit Azam’s allegations and to presume that
Judge Staton had some form of “interest” in the determination of the VRA Case
allegations, there is no actual connection between those allegations and any of the cases
Judge Staton has resolved. Nor is there any connection to the instant case. The Court is
highly skeptical of Azam’s claims that Judge Staton has any tangible interest in the
outcome of the VRA Case issues, and even less convinced that any such interest would
mandate disqualification. However, it is not necessary to determine that issue in order to
resolve this motion because those claims are not before Judge Staton in this case. Based
on the foregoing, the Court finds that “a reasonable person with knowledge of all the
facts” would not conclude that Judge Staton’s impartiality might reasonably be
questioned. United States v. Hernandez, 109 F.3d at 1453-54.
The second general basis Azam uses to support her disqualification argument is
bias demonstrated by Judge Staton’s actions in Azam’s assorted cases up to this point.
Azam describes this bias as follows:
It is [Judge Staton’s] predisposition (whether or not intended),
demonstrated bias (including in advance indicating on the docket that U.S.
Bank as an institutional trustee is a real party defendant), references to
“other litigation” (inferring the challenges to section 5 of SBX2 11), and

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 12-1732-JLS (MLGx)

Date: June 19, 2014
Page 7

repeated determinations (and administrative process engaged) without
allowing plaintiff to be heard or to impact the issues in the case which
develops a pattern of pervasive bias which is of concern.
Mot. at 17.
This rough category of actions suggesting bias appears to encompass the
administrative actions and rulings Judge Staton has taken and made in Azam’s lawsuits
before her. All of these allegations address “opinions formed by the judge on the basis of
facts introduced or events occurring in the course of the current proceedings, or of prior
proceedings,” and so require a showing of “deep-seated favoritism or antagonism that
would make fair judgment impossible.” Liteky, 510 U.S. at 555. Azam cannot meet this
high standard. Judge Staton’s actions, largely mundane acts associated with case
management and motion work, do not show even a low level of dislike or animosity.
Certainly they do not approach deep-seated favoritism or antagonism. This does not
provide a basis for disqualification.
b. 28 U.S.C. § 47
i. Legal Standard
The language of 28 U.S.C. § 47 provides: “No judge shall hear or determine an
appeal from the decision of a case or issue tried by him.” 28 U.S.C. § 47. “It is
important to a litigant and to the fairness and public reputation of judicial proceedings
that review of a case be conducted by ‘a judge other than the judge who presided over the
case at trial.’” Weddington v. Zatecky, 721 F.3d 456, 461 (7th Cir. 2013) (quoting
Clemmons v. Wolfe, 377 F.3d 322, 325 (3d Cir. 2004)).
ii. Discussion
Azam argues that “Judge Staton cannot determine the general civil actions (in
which Azam’s defenses to claims of defendants is based on bankruptcy matters) and sit as
the court of review in the bankruptcy proceedings.” See Mot. at 17. The argument
appears to be that Judge Staton violates 28 U.S.C. § 47 if she determines similar or
identical issues in both direct civil litigation and as the appellate court for a bankruptcy
action. This mistakes the true purpose of § 47, however. In determining civil issues both
in review of a bankruptcy appeal or an action brought directly to the district court, a

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CENTRAL DISTRICT OF CALIFORNIA
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judge does not act as the reviewing court of its own work. See Swann v. CharlotteMecklenburg Bd. of Ed., 431 F.2d 135, 137 (4th Cir. 1970) (“A judge who has sat at the
hearing below of a whole cause at any stage thereof is undoubtedly disqualified to sit on
the circuit court of appeals at the hearing of the whole cause at the same or at any later
stage.”). Rather, in both situations a separate court has the power to reverse the district
court’s decisions. Those reviewing courts are not the district judge sitting in the case.
Judge Staton does not have the authority to affirm her own orders in either
situation; she may merely have the same issues presented in different contexts. Under no
circumstance would she be able to affirm her own work on appeal. Furthermore,
adopting the rule that a district judge is disqualified from hearing civil cases presenting
similar or identical issues to concurrent bankruptcy appeals would encourage
gamesmanship by creative litigants in either position.
c. The Fourteenth Amendment
i. Legal Standard
“[O]nly in the most extreme of cases would disqualification” be required under the
Due Process Clause of the Fourteenth Amendment. Aetna Life Ins. Co. v. Lavoie, 475
U.S. 813, 821 (1986). “A fair trial in a fair tribunal is a basic requirement of due
process.” In re Murchison, 349 U.S. 133, 136 (1955). However, “most matters relating
to judicial disqualification [do] not rise to a constitutional level.” FTC v. Cement
Institute, 333 U.S. 683, 702 (1948). “The Court asks not whether the judge is actually,
subjectively biased, but whether the average judge in his position is ‘likely’ to be neutral,
or whether there is an unconstitutional ‘potential for bias.’” Caperton v. A.T. Massey
Coal Co., Inc., 556 U.S. 868, 881 (2009).
ii. Analysis
Azam reiterates her earlier arguments under the Due Process standard. The Court
sees no basis for finding either actual bias or such a strong potential for bias that would
indicate the kind of “extreme case” justifying disqualification. As discussed previously,
Judge Staton has no actual interest in the outcome of this case, nor do her previous
actions suggest any antagonism that would deprive Azam of a fair trial. The Court
therefore finds that disqualification is not required by the Fourteenth Amendment.

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 12-1732-JLS (MLGx)

III.

Date: June 19, 2014
Page 9

Disposition

In light of the foregoing, the court finds finds that disqualification is not required
in this matter. To the extent that any arguments were not specifically discussed in this
Order or were discussed only generally, the Court has considered and rejected those
arguments. The motion is therefore DENIED.
The Clerk shall serve a copy of this minute order on counsel for all parties in this
action.
MINUTES FORM 11
CIVIL-GEN

Initials of Deputy Clerk: jcb