Hahn v. GMAC Mortgage LLC et al

Filing 7

ORDER of Dismissal. ORDERED that the Complaint and this action are dismissed without prejudice, by Judge Lewis T. Babcock on 12/15/11. (lyg, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 11-cv-02978-BNB
LINAYA GAIL HAHN,
Plaintiff,
v.
GMAC MORTGAGE LLC,
MORTGAGE ELECTRONIC REGISTRATION SYSTEM INC.,
THE PUBLIC TRUSTEE OF BOULDER COUNTY, and
HONORABLE JUDGE BAILIN,
Defendants.

ORDER OF DISMISSAL

Plaintiff, Linaya Gail Hahn, initiated this action by filing pro se a Complaint
asserting a federal due process claim and numerous state law claims arising out of the
foreclosure sale of certain real property located in Lyons, Colorado. Ms. Haun has
been granted leave to proceed in forma pauperis pursuant to 28 U.S.C. § 1915.
The Court must construe the Complaint liberally because Ms. Hahn is not
represented by an attorney. See Haines v. Kerner, 404 U.S. 519, 520-21 (1972); Hall
v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991). If the Complaint reasonably can be
read “to state a valid claim on which the plaintiff could prevail, [the Court] should do so
despite the plaintiff’s failure to cite proper legal authority, his confusion of various legal
theories, his poor syntax and sentence construction, or his unfamiliarity with pleading
requirements.” Hall, 935 F.2d at 1110. However, the Court should not be an advocate

for a pro se litigant. See id. For the reasons set forth below, the Complaint will be
dismissed.
Ms. Haun challenges a foreclosure proceeding initiated by Defendant GMAC
Mortgage LLC (GMAC) against real property upon which she resides in Lyons,
Colorado. Plaintiff alleges that GMAC is not a holder in due course of the deed of trust
to the property as required by COLO.REV.STAT. § 38-38-101 (2010) and, therefore,
had no legal right to foreclose against the property. Plaintiff further alleges that the
purported assignment of the deed of trust by Defendant Mortgage Electronic
Registration System, Inc. (MERS), as agent for the undisclosed owner, to GMAC in
September 2009 was null and void because MERS did not own the underlying
promissory note (Note). Ms. Haun further alleges that any debt she owed on the
property has been discharged in a bankruptcy proceeding. According to Plaintiff, the
Boulder County District Court issued an order authorizing a foreclosure sale of the
property by public trustee pursuant to Colo. R. Civ. P. 120 on February 28, 2011,
despite GMAC’s failure to proffer any evidence that it is in possession or control of the
original Note. Ms. Haun alleges that a foreclosure sale has occurred and she is
awaiting eviction from the property. Plaintiff claims that Defendant GMAC has
unlawfully deprived her of property without due process of law in violation of the federal
Constitution. She further asserts numerous pendent state law claims based on
asserted deficiencies in the state foreclosure proceeding, including fraudulent
misrepresentation. Ms. Haun seeks declaratory relief, an order enjoining Defendants
from evicting Plaintiff from her property during the pendency of this action, an order
nullifying the foreclosure sale, and an award of treble damages.
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Pursuant to Fed. R. Civ. P. 12(h)(3), the Court must dismiss an action if the Court
lacks subject matter jurisdiction. The issue of subject matter jurisdiction may be raised
sua sponte by the Court at any time during the course of the proceedings. See
McAlester v. United Air Lines, Inc., 851 F.2d 1249, 1252 (10th Cir. 1988). “The party
seeking to invoke the jurisdiction of a federal court must demonstrate that the case is
within the court’s jurisdiction.” United States v. Bustillos, 31 F.3d 931, 933 (10th Cir.
1994).
The Court lacks subject matter jurisdiction over the claims in the Complaint
because Plaintiff is asking the Court to review the foreclosure proceeding in the Boulder
County District Court. The Rooker-Feldman doctrine provides that federal courts, other
than the United States Supreme Court, lack jurisdiction to adjudicate claims seeking
review of state court judgments. See District of Columbia Court of Appeals v.
Feldman, 460 U.S. 462, 486 (1983); Rooker v. Fidelity Trust Co., 263 U.S. 413, 41516 (1923). The Rooker-Feldman doctrine precludes “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); see also Johnson v. De Grandy, 512 U.S. 997, 1005-06 (1994) (stating that
the losing party in a state court proceeding is generally “barred from seeking what in
substance would be appellate review of the state court judgment in a United States
district court, based on the losing party’s claim that the state judgment itself violates the
loser’s federal rights.”).

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The Rooker-Feldman doctrine bars not only cases seeking direct review of state
court judgments; it also bars cases that are “inextricably intertwined” with a prior state
court judgment. See Feldman, 460 U.S. at 482 n.16. “To determine whether a federal
plaintiff’s claim is inextricably intertwined with a state court judgment, [the Court] must
pay close attention to the relief the plaintiff seeks.” Crutchfield v. Countrywide Home
Loans, 389 F.3d 1144, 1147-48 (10th Cir. 2004). “Where a plaintiff seeks a remedy
that would disrupt or undo a state court judgment, the federal claim is inextricably
intertwined with the state court judgment.” Id. at 1148; see also Mann v. Boatright,
477 F.3d 1140 (10th Cir. 2007) (claim is “inextricably intertwined” with the state court
judgment where success in federal district court would require court “to review and
reject” that judgment); Pittsburgh County Rural Water Dist. No. 7 v. City of Maltster,
358 F.3d 694, 707 (10th Cir. 2004) (federal claim is inextricably intertwined with state
court judgment if the state court judgment “caused, actually and proximately, the injury
for which [the party] seeks redress”).
Ms. Haun’s claims are inextricably intertwined with the state court judgment.
Plaintiff's federal due process claim is premised on the argument that GMAC has
violated her constitutional rights by “taking” her property in a foreclosure proceeding
without the legal right to do so. Ms. Haun’s pendent state law claims assert numerous
deficiencies and fraud during the state foreclosure proceeding, all of which stem from
Plaintiff’s contention that Defendant GMAC and MERS have no legal right to the
property. Furthermore, Plaintiff asks this Court to over-turn the state court’s order
authorizing the foreclosure sale and to award her compensatory damages. In short, all

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of Ms. Haun’s claims are inextricably intertwined with the state court order finding that
she was in default on her mortgage and authorizing the foreclosure. See, e.g., Broke
v. Chase Home Finance, LLC, No. 10-CV-00692-WYD-MJW, 2010 WL 2691693 at *6
(D. Colo. July 6, 2010) (claim that bank lacked a valid security interest was resolved
against plaintiff in the state court foreclosure proceeding in determining that a default
occurred and was barred by Rooker-Feldman doctrine); Mayhew v. Cherry Creek
Mortg. Co., Inc., No. 09-cv-00219-PAB-CBS, 2010 WL 935674 at **16-17 (D. Colo.
March 10, 2010) (claim seeking to challenge or reverse completed state foreclosure
proceeding was barred by Rooker-Feldman doctrine); Burlinson v. Wells Fargo
Bank, N.A., No. 08-cv-01274-REB-MEH, 2009 WL 646330 at **5-6 (D. Colo. March 9,
2009) (same).
If Plaintiff’s claims are not barred by the Rooker-Feldman doctrine, she must
nonetheless pursue relief in the state courts. Colo. R. Civ. P. 120(d) provides for review
of an order authorizing sale in “any court of competent jurisdiction.” However, the
Colorado Rules of Civil Procedure cannot confer jurisdiction in federal court. The Court
has federal question jurisdiction over the federal due process claim and could potentially
exercise supplemental jurisdiction over a Rule 120 proceeding claim, pursuant to 28
U.S.C. § 1367. However, this Court’s exercise of supplemental jurisdiction over the
plaintiff’s Rule 120 proceeding is inappropriate for two reasons. First, § 1367 allows
federal courts to decline to exercise supplemental jurisdiction if “the claim substantially
predominates over the claim or claims over which the district court has original
jurisdiction.” 28 U.S.C. § 1367(c)(2). Here, whether GMAC had the legal right under

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state law to foreclose on the Plaintiff’s property is the crux of her case, as well as the
basis of her federal due process claim. See Burlinson, 2009 WL 646330 at *6. Thus,
the Rule 120 proceeding initiated by Defendant GMAC substantially predominates over
the federal claim. Id.
Second, the exercise of supplemental jurisdiction over the Rule 120 proceeding
is not warranted where there is an ongoing state proceeding and the state court
provides an adequate forum to present any federal challenges. Id. at *7 (citing
Younger v. Harris, 401 U.S. 37 (1971)). Younger abstention is appropriate where the
state courts provide an adequate forum to hear the claims raised in the federal
complaint and the state proceedings involve important state interests. See Weitzel v.
Div. of Occupational & Prof’l Licensing, 240 F.3d 871, 875 (10th Cir. 2001). In this
case, it is unclear whether there is an ongoing state proceeding at this time. If there has
been a final judgment, Rooker-Feldman applies. If the Rule 120 proceeding is
ongoing, Ms. Haun can continue to challenge the foreclosure sale and GMAC’s legal
right to the property in the state courts. Furthermore, matters concerning foreclosure
have traditionally been resolved in the state courts. See Colo. R. Civ. P. 120(f)
(providing that “[a]ny proceeding under this Rule involving a consumer obligation shall
be brought in and heard in the county in which such consumer signed the obligation or
in which the property or a substantial part thereof is located.”). Accordingly, the Court
finds that, to the extent the Plaintiff’s claims are not barred by Rooker-Feldman, this
Court should abstain from exercising jurisdiction over the claims to allow her to pursue

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her legal remedies in the district court for Boulder County and the state appellate courts.
Accordingly, it is
ORDERED that the Complaint and this action are dismissed without prejudice for
lack of subject matter jurisdiction.
DATED at Denver, Colorado, this

15th

day of

December

, 2011.

BY THE COURT:

s/Lewis T. Babcock
LEWIS T. BABCOCK, Senior Judge
United States District Court

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