Rudnick et al v. Bank of America, National Association et al

Filing 154

ORDER re: 149 Sealed Document Joint Status Report filed by Bank of America, National Association, Mortgage Electronic Registration Systems, Inc., Litton Loan Servicing, LP.;Accordingly, it is ORDERED that the parties will file with the Court on or before September 23, 2011 a comprehensive Settlement Agreement and Mutual Release fully and finally disposing of all claims in this action Dismissal Paper due by 9/23/2011. by Judge William J. Martinez on 9/12/2011. (erv, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge William J. Martínez
Civil Action No. 10-cv-00144-WJM-MJW
MICHAEL D. RUDNICK and ANN K. SMITH RUDNICK,
Plaintiffs,
v.
BANK OF AMERICA, NATIONAL ASSOCIATION,
as SUCCESSOR BY MERGER TO LASALLE BANK, NATIONAL ASSOCIATION,
TRUSTEE UNDER THE POOLIGN AND SERVICE AGREEMENT DATED AS OF
FEBRUARY 1, 2007, GSAMP TRUST 2007-NC-1;
LITTON LOAN SERVICING, LP;
MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC.;
PUBLIC TRUSTEE OF DENVER COUNTY; and
All Unknown Persons Who Claim Any Interest in the Subject Matter of this Action,
Defendants.

ORDER ON JOINT STATUS REPORT

THIS MATTER is before the Court on the Parties’ Joint Status Report and
Stipulation Regarding Settlement (“Joint Status Report”), ECF No. 149, filed on August
29, 2011.
Jurisdiction and the Rooker-Feldman Doctrine
Plaintiff filed this quiet title action in Denver County District Court on October 20,
2009 under Colo. R. Civ. P. 105. “The manifest intent of quiet title is to provide a
complete adjudication of the rights of all parties, and to grant full and adequate relief so
as to completely determine the controversy and enforce the rights of the parties.” Argus
Real Estate, Inc. v. E-470 Pub. Highway Auth., 109 P.3d 604, 612 (Colo. 2005) (internal
quotation and citations omitted). Plaintiffs contest foreclosure proceedings due to a lack

of due process and an allegation that Defendant Bank of America did not hold a valid
security interest in the property. (ECF No. 136 at 3.) Defendants, during an August 18,
2011 hearing, voiced concerns that this Court did not have jurisdiction over the matter
based on the Rooker-Feldman doctrine.
The Rooker-Feldman doctrine, derived from the Supreme Court's decisions in
Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923), and District of Columbia Court of
Appeals v. Feldman, 460 U.S. 462 (1983), “prohibits federal suits that amount to
appeals of state-court judgments.” Bolden v. City of Topeka, 441 F.3d 1129, 1139 (10th
Cir. 2006). The doctrine is grounded in Congress' grant of appellate jurisdiction to
review state court decisions exclusively to the Supreme Court. As such, a claim inviting
a federal district court to review and reverse an unfavorable state court decision is
outside of a lower federal court's jurisdiction. See, e.g., Rooker, 263 U.S. at 416.
The Tenth Circuit in Bolden defined the reach of the doctrine:
[T]he Rooker-Feldman doctrine “is confined to cases of the kind from which the
doctrine acquired its name: cases brought by state-court losers complaining of
injuries caused by state-court judgments rendered before the district court
proceedings commenced and inviting district court review and rejection of those
judgments.” [Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284
(2005)]. The doctrine “does not otherwise override or supplant preclusion
doctrine.” Id. [ ]. In particular, the statute granting the Supreme Court appellate
jurisdiction over state-court judgments, 28 U.S.C. § 1257, does not “stop a district
court from exercising subject-matter jurisdiction simply because a party attempts
to litigate in federal court a matter previously litigated in state court. If a federal
plaintiff presents some independent claim, albeit one that denies a legal
conclusion that a state court has reached in a case to which he was a party, then
there is jurisdiction and state law determines whether the defendant prevails
under principles of preclusion.” Id. at [293].
Id. at 1142-43 (emphasis in Tenth Circuit decision). The Bolden court recognized that
this latter “independent claim” principle:

undermines the district court’s ruling in this case that Rooker-Feldman barred
certain of Mr. Bolden’s claims because they “could succeed only to the extent
that the state court wrongly decided that [he] did not qualify for funding.” . . .
Appellate review – the type of judicial action barred by Rooker-Feldman –
consists of a review of the proceedings already conducted by the “lower” tribunal
to determine whether it reached its result in accordance with law. When, in
contrast, the second court tries a matter anew and reaches a conclusion contrary
to a judgment by the first court, without concerning itself with the bona fides of
the prior judgment (which may or may not have been a lawful judgment under the
evidence and argument presented to the first court), it is not conducting appellate
review, regardless of whether compliance with the second judgment would make
it impossible to comply with the first judgment.
Id. at 1143.
Bolden controls here. Thus, because Plaintiffs are not requesting the Court
conduct an appellate review of the foreclosure action, but are instead asserting a quiet
title action, the Court finds that it does have subject matter jurisdiction over the claims
asserted in this action.
Matters Regarding Stipulation of Settlement
The Court, having reviewed the Joint Status Report, is advised that the Parties
anticipate completion and execution of a Settlement Agreement and Mutual Release by
September 23, 2011. The Court is further advised that upon execution of a full and final
settlement and release, and upon completion of all requirements specified in the Joint
Status Report, the parties will execute a stipulation for mutual dismissal with prejudice
and release of all claims against parties to this action.
Accordingly, it is ORDERED that the parties will file with the Court on or before
September 23, 2011 a comprehensive Settlement Agreement and Mutual Release fully
and finally disposing of all claims in this action.

Dated this 12th day of September, 2011.
BY THE COURT:

William J. Martínez
United States District Judge