Bank of New York Mellon v. City of Richmond, California et al

Filing 29

Ex Parte Application re 28 MOTION to Dismiss for Lack of Jurisdiction EX PARTE MOTION TO SHORTEN TIME AND FOREGO HEARING filed by City of Richmond, California, Gordian Sword LLC, Mortgage Resolution Partners L.L.C., Richmond City Council. (Attachments: # 1 Declaration Declaration of Eric P. Brown in Support of Ex Parte, # 2 Exhibit Exhibit A to the Declaration of Eric P. Brown, # 3 Exhibit Exhibit B to the Declaration of Eric P. Brown, # 4 Exhibit Exhibit C to the Declaration of Eric P. Brown, # 5 Exhibit Exhibit D to the Declaration of Eric P. Brown, # 6 Exhibit Exhibit E to the Declaration of Eric P. Brown, # 7 Exhibit Exhibit F to the Declaration of Eric P. Brown, # 8 Exhibit Exhibit G to the Declaration of Eric P. Brown, # 9 Exhibit Exhibit H to the Declaration of Eric P. Brown, # 10 Proposed Order Proposed Order)(Leyton, Stacey) (Filed on 9/20/2013)

EXHIBIT F

Case3:13-cv-03663-CRB Document76 Filed09/13/13 Page1 of 4

1 STEPHEN P. BERZON (SBN 46540)
SCOTT A. KRONLAND (SBN 171693)
2 STACEY M. LEYTON (SBN 203827)
3 ERIC P. BROWN (SBN 284245)
Altshuler Berzon LLP
4 177 Post Street, Suite 300
San Francisco, CA 94108
5 Tel: [phone]
Fax: [phone]
6 E-mail: [e-mail]
[e-mail]
7
[e-mail]
[e-mail]
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9 Attorneys for Defendants City of Richmond and
Mortgage Resolution Partners LLC
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11 BRUCE REED GOODMILLER (SBN 121491)
City Attorney
12 CARLOS A. PRIVAT (SBN 197534)
Assistant City Attorney
13 CITY OF RICHMOND
450 Civic Center Plaza
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Richmond, CA 94804
15 Telephone: [phone]
Facsimile: [phone]
16 E-mail: [e-mail]
[e-mail]
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Attorneys for Defendant City of Richmond
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Attorney for Defendant
Mortgage Resolution Partners LLC

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN FRANCISCO DIVISION

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21 WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Trustee, et al.,
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Plaintiffs,

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WILLIAM A. FALIK (SBN 53499)
100 Tunnel Rd.
Berkeley, CA 94705
Tel: [phone]
Fax: [phone]
E-mail: [e-mail]

v.

25 CITY OF RICHMOND, CALIFORNIA, a
26 municipality, and MORTGAGE
RESOLUTION PARTNERS LLC,
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Defendants.
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Case No. CV-13-3663-CRB
DEFENDANTS’ SUPPLEMENTAL
MEMORANDUM IN SUPPORT OF
MOTION TO DISMISS FOR LACK OF
JURISDICTION (DOC. 38)
Date: Sept. 12, 2013
Time: 10:00 am
Place: Courtroom 6, 17th Floor
The Hon. Charles R. Breyer

Defs’ Suppl. Memo in Support of Motion to Dismiss, Case No. CV-13-3663-CRB

Case3:13-cv-03663-CRB Document76 Filed09/13/13 Page2 of 4

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DEFENDANTS’ SUPPLEMENTAL MEMORANDUM IN SUPPORT OF
MOTION TO DISMISS FOR LACK OF JURISDICTION (DOC. 38)

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The Court allowed supplemental briefing on two questions: 1) whether the Court has

4 authority to do anything other than dismiss claims over which it lacks subject matter jurisdiction,
5 and 2) whether the Court should grant the Banks leave to amend their Complaint. The answer to
6 both questions is no.
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1. The Court Must Dismiss This Case

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Defendants have moved to dismiss this case for lack of subject matter jurisdiction. The

9 lack of jurisdiction is obvious. As the Court correctly observed at the September 12, 2013 hearing,
10 the Article III standing/ripeness issue is a “no brainer.” The Court recognized that this case
11 involves legislative action that has not yet occurred. Therefore, the Court must grant the motion to
12 dismiss and does not have discretion to do anything else.
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“Without jurisdiction the court cannot proceed at all . . . the only function remaining to the

14 court is that of announcing the fact and dismissing the cause.” Steel Co. v. Citizens for a Better
15 Environment, 523 U.S. 83, 94 (1998) (quoting Ex parte McCardle, 74 U.S. 506 (1868)); see also
16 Fed. R. Civ. P. 12(h)(3) (“If the court determines at any time that it lacks subject-matter
17 jurisdiction, the court must dismiss the action.”) (emphasis supplied); Herman Family Revocable
18 Trust v. Teddy Bear, 254 F.3d 802, 807 (9th Cir. 2001) (“[o]nce the district court reached the
19 conclusion that it had no underlying original subject matter jurisdiction, there was nothing left to
20 do but to dismiss the case . . . [jurisdiction is not] a matter of equity or discretion”).
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2.

The Banks Should Not Be Granted Leave to Amend

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A Court considering a motion to dismiss for lack of subject matter jurisdiction under Rule

23 12(b)(1) is not limited to reviewing the pleadings. White v. Lee, 227 F.3d 1214, 1242 (9th Cir.
24 2000). Defendants presented uncontroverted evidence that the Richmond City Council has not
25 adopted a resolution of necessity to authorize the use of eminent domain authority to condemn
26 mortgage loans, nor is such a resolution even on the City Council’s agenda. Lindsay Decl. ¶22
27 (Doc. 33). The Banks conceded at the hearing that these facts are true. As such, any amendment
28 would be futile because it would not change the conclusion that the Court lacks subject matter
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Defs’ Suppl. Memo in Support of Motion to Dismiss, Case No. CV-13-3663-CRB

Case3:13-cv-03663-CRB Document76 Filed09/13/13 Page3 of 4

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1 jurisdiction. The Court should not grant leave to amend when the amendment would be futile.

The Court should also bear in mind that this case is a SLAPP suit. The Banks filed this

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3 case even though the lack of subject matter jurisdiction is obvious and the Banks’ arguments to the
4 contrary are Rule 11 frivolous. Simply having a lawsuit on file serves the Banks’ purpose of
5 chilling the political process. While a lawsuit is pending, financial institutions are reluctant to
6 negotiate in good faith with the City on a principal reduction solution. While a lawsuit is pending,
7 other municipalities are reluctant to join a Joint Powers Authority to consider solutions to the
8 underwater mortgage crisis. Dragging out the dismissal of this SLAPP suit would be an
9 impediment to full consideration of potential solutions to a serious problem adversely affecting
10 numerous Richmond homeowners. These solutions may or may not involve the use of eminent
11 domain authority, and they will be subject to judicial review if and when the time is ripe.
CONCLUSION

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The Court should dismiss this case forthwith for lack of jurisdiction.

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At the hearing, the Banks misrepresented the process for adopting a resolution of necessity as
“ministerial.” A resolution of necessity is a legislative action that can be taken only after a
noticed public hearing, and the point of such a public hearing is to provide the legislative body
with information to decide whether, among other things, “public interest and necessity” justify the
use of eminent domain authority. See Santa Cruz Cnty. Redevelopment Agency v. Izant, 37
Cal.App.4th 141, 148-51 (1995) (“the resolution of necessity is a legislative act”); id. at 149 (it
would be a “gross abuse of discretion” for the legislative body to “irrevocably commit[] itself to
the taking of the property regardless of the evidence presented” at the public hearing); Anaheim
Redevelopment Agency v. Dusek, 193 Cal.App.3d 249, 260 (1987) (“the decision to condemn . . .
property [presents] ‘a fundamental political question’”; “[t]hese considerations are inherently
legislative”). As such, there are no facts the Banks could allege that would make this case ripe.
Moreover, as the Banks acknowledge, the most recent action by the Richmond City Council was
to “direct staff to . . . work to set up a Joint Powers Authority with other interested
municipalities,” so the entity that may or may not be called upon to consider a hypothetical
proposed resolution of necessity may not even exist yet.

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Defs’ Suppl. Memo in Support of Motion to Dismiss, Case No. CV-13-3663-CRB

Case3:13-cv-03663-CRB Document76 Filed09/13/13 Page4 of 4

1 Dated: September 13, 2013

Respectfully submitted,

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/s/ Scott A. Kronland
Scott A. Kronland

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Stephen P. Berzon
Scott A. Kronland
Stacey M. Leyton
Eric P. Brown
Altshuler Berzon LLP
Attorneys for Defendants
City of Richmond and
Mortgage Resolution Partners LLC

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Bruce Reed Goodmiller
Carlos A. Privat
City of Richmond

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Attorneys for Defendant City of Richmond

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William A. Falik

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Attorney for Defendant
Mortgage Resolution Partners LLC

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Defs’ Suppl. Memo in Support of Motion to Dismiss, Case No. CV-13-3663-CRB