MacIntyre v. JP Morgan Chase Bank,NA, et al
Filing
138
ORDER granting in part and denying in part 128 Motion to Alter or Amend Judgment Pursuant to FED.R.CIV.P. 59(e), or Alternatively to Certify Issues for Interlocutory Appeal Pursuant to 28 U.S.C. § 1291. The Court's Order Adoptin g the Recommendation of the Magistrate Judge and Granting Defendant's Motion to Dismiss (ECF No. 126 ) is VACATED. The Recommendation of the Magistrate Judge (ECF No. 117 ) is ADOPTED IN PART as to the Colorado River doctrine and REJECTED I N PART as to the Younger abstention doctrine. Defendant's Motion to Dismiss Third Amended Complaint (ECF No. 110 ) is GRANTED. An amended judgment against Plaintiff and in favor of Defendant shall issue. Defendant shall have its costs. By Judge William J. Martinez on 3/19/2015. (alowe)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge William J. Martínez
Civil Action No. 12-cv-2586-WJM-MEH
HOLLY MACINTYRE,
Plaintiff,
v.
JP MORGAN CHASE BANK,
Defendant.
ORDER GRANTING IN PART AND DENYING IN PART
PLAINTIFF’S MOTION TO ALTER OR AMEND JUDGMENT
This matter is before the Court on Plaintiff Holly MacIntyre’s (“Plaintiff”) Motion to
Alter or Amend Judgment Pursuant to Federal Rule of Civil Procedure 59(e), Or
Alternatively to Certify Issues for Interlocutory Appeal Pursuant to 28 U.S.C. § 1291
(“Motion”). (ECF No. 128.) Plaintiff asks the Court to amend the judgment in this
matter pursuant to Rule 59(e) on the grounds that the Court misconstrued the facts and
law. (Id.) For the following reasons, Plaintiff’s Motion is granted in part and denied in
part.
I. BACKGROUND
Plaintiff brings this action for quiet title and slander of title in relation to
Defendant’s attempt to foreclose on the property located at 13025 W. 63rd Place, #E,
Arvada, Colorado 80004 (“Property”). (ECF No. 35.) Plaintiff states that she has
owned the Property since March 31, 1995. (Id. at 6.) On June 25, 2013, Defendant
terminated its non-judicial foreclosure proceeding, and on November 21, 2013, it filed a
judicial foreclosure proceeding in Jefferson County District Court (the “Foreclosure
Proceeding”). (See ECF Nos. 82-1 & 110-10.)
On December 2, 2013, with leave of Court, Plaintiff filed her Third Amended
Complaint. (ECF No. 108.) On February 21, 2014, U.S. Magistrate Judge Michael E.
Hegarty entered a Recommendation that Defendant’s Motion to Dismiss be granted
based on Younger v. Harris, 401 U.S. 37 (1971), or alternatively, based on Colorado
River Water Conservation District v. United States, 424 U.S. 800 (1976). (ECF No.
117.) On July 31, 2014, the Court overruled Plaintiff’s objections to the
Recommendation, adopted the Recommendation to abstain based on Younger, and
declined to address the Magistrate Judge’s alternative recommendation under Colorado
River. (ECF No. 126.) Final Judgment was entered the same day. (ECF No. 127.)
On August 28, 2014, Plaintiff filed the instant Motion under Rule 59(e). (ECF No.
128.) Defendant filed a Response (ECF No. 129), and Plaintiff a Reply (ECF No. 131).
On December 2, 2014, a trial was held in the Foreclosure Proceeding, and on
December 16, 2014, the state court entered a judg ment in favor of Defendant,
foreclosing on the Property. (ECF Nos. 135 & 135-1.) Plaintiff filed a Notice of Appeal
of the judgment in the Colorado Court of Appeals on January 23, 2015. (ECF No. 135
at 2.)
II. DISCUSSION
Rule 59(e) permits a Court to alter or amend a judgment on timely motion by a
party. Fed. R. Civ. P. 59(e). “Rule [59(e)] was adopted to make clear that the district
court possesses the power to rectify its own mistakes in the period immediately
following the entry of judgment.” White v. N.H. Dep’t of Emp’t Sec., 455 U.S. 445, 450
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(1982) (internal quotation marks omitted). Accordingly, the Court may amend the
judgment in its discretion where there has been an intervening change in the controlling
law, new evidence that was previously unavailable has come to light, or the Court sees
a need to correct clear error or prevent manifest injustice. Servants of Paraclete v.
Does, 204 F.3d 1005, 1012 (10th Cir. 2000). “A m otion for reconsideration is
appropriate where the court has misapprehended the facts, a party’s position, or the
controlling law.” Id. However, motions to alter or amend the judgment pursuant to Rule
59(e) “are regarded with disfavor. . . [and are] ‘not appropriate to revisit issues already
addressed or advance arguments that could have been raised in prior briefing.’” Kerber
v. Qwest Group Life Ins. Plan, 727 F. Supp. 2d 1076, 1076 (D. Colo. 2010) (q uoting
Servants of the Paraclete, 204 F.3d at 1012).
Plaintiff argues that the Court erred in its Order adopting the Recommendation
because the Younger abstention doctrine does not apply to this case under Sprint
Communications v. Jacobs 134 S. Ct. 584 (2013), and further argues that the
Magistrate Judge’s alternative basis for the Recommendation, the Colorado
River doctrine, also does not apply to this case. (ECF No. 128.) Plaintiff makes no
argument that there has been a change in law or that new evidence has become
available since the Court’s order was entered; thus, the Court must find clear error or
manifest injustice in order to grant Plaintiff’s Motion. See Servants of the Paraclete,
204 F.3d at 1012. The Court will consider the Younger and Colorado River doctrines in
turn.
A.
Younger Abstention
The Court’s Order adopting the Recommendation found that three factors
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requiring mandatory abstention under Younger were satisfied here: (1) the Foreclosure
Proceeding is an ongoing state civil proceeding; (2) the state court provides an
adequate forum to hear the claims Plaintiff raises; and (3) the Foreclosure Proceeding
involves important state interests. (ECF No. 126 at 5-7.) Plaintif f failed to cite Sprint in
both her response to Defendant’s Motion to Dismiss and her Objection to the
Recommendation, but now contends that Sprint altered the third factor analysis such
that Younger does not apply here. (ECF No. 128 at 2-8.)
The Magistrate Judge’s analysis relied on Amanatullah v. Colorado Board of
Medical Examiners, 187 F.3d 1160 (10th Cir. 1999), which held that the three factors of
a Younger abstention analysis are as follows:
(1) [T]here is an ongoing state criminal, civil, or
administrative proceeding, (2) the state court provides an
adequate forum to hear the claims raised in the federal
complaint, and (3) the state proceedings “involve important
state interests, matters which traditionally look to state law
for their resolution or implicate separately articulated state
policies.”
Id. at 1163 (quoting Taylor v. Jaquez, 126 F.3d 1294, 1297 (10th Cir. 1997)). However,
in Sprint, the Supreme Court reversed a decision by the Eighth Circuit Court of Appeals
that applied Younger abstention using substantially the same analysis as in
Amanatullah, holding that the use of the “important state interests” factor improperly
broadened the scope of the abstention doctrine. Sprint, 134 S. Ct. at 593. Instead, the
Sprint Court clarified that “Younger extends to the three ‘exceptional circumstances’
identified in [New Orleans Public Service, Inc. v. Council of the City of New Orleans,
491 U.S. 350, 368 (1989)], but no f urther.” Id. at 594. These three circumstances
include (1) state criminal prosecutions, (2) civil enforcement proceedings, and (3) “civil
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proceedings involving certain orders uniquely in furtherance of the state courts’ ability to
perform their judicial functions.” Id. at 591.
Thus, the Court agrees with Plaintiff that Sprint significantly cabined the breadth
of Younger abstention as it has been applied in this circuit. As Sprint clarifies, a court
evaluating whether Younger requires abstention must determine not whether a
proceeding involves any important state interest, but whether it falls under one of the
three specifically enumerated categories, none of which appear to apply to the
Foreclosure Proceeding. In Response to the Motion, Defendant has declined even to
discuss Sprint, conceding that it “arguably undercuts the application of the Younger
doctrine” in this case. (ECF No. 129 at 7.) Accordingly, the Court finds that, following
Sprint, Younger abstention does not apply to this case. Therefore, the Court’s Order
adopting the Recommendation pursuant to Younger was in error, and the Motion is
granted as to the application of the Younger abstention doctrine.
The Court previously declined to address the Magistrate Judge’s alternative
recommendation that the Court abstain from exercising jurisdiction pursuant to the
Colorado River doctrine. (ECF No. 126 at 8.) Accordingly, the Court proceeds to that
analysis.
B.
Colorado River
The Colorado River doctrine governs whether a district court should stay or
dismiss a federal suit pending the resolution of a parallel state court proceeding. See
Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 817-18
(1976). The appropriate circumstances for deferral to state proceedings under the
Colorado River doctrine are “considerably more limited than the circumstances
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appropriate for abstention” and must be “exceptional.” See Colorado River, 424 U.S. at
817-18. Accordingly, the Court’s “task in cases such as this is not to find some
substantial reason for the exercise of federal jurisdiction . . . ; rather, the task is to
ascertain whether there exist exceptional circumstances, the clearest of justifications,
that can suffice under Colorado River to justify the surrender of the jurisdiction.” Moses
H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 25-26 (1983).
The Supreme Court has identified several non-exclusive factors to consider in
evaluating whether to decline jurisdiction, including: (1) whether the state or federal
court has assumed jurisdiction over property in dispute; (2) the inconvenience to the
parties of the federal forum; (3) avoiding piecemeal litigation; (4) the order in which the
courts obtained jurisdiction; (5) the vexatious nature of the litigation; (6) whether federal
law provides the rule of decision; and (7) and the adequacy of the state court
proceeding to protect the federal plaintiff’s rights. See Colorado River, 424 U.S. at 818;
Moses H. Cone, 460 U.S. at 18-28. These factors are not a “mechanical checklist”;
rather, the Court should “careful[ly] balanc[e] . . . the most important factors as they
apply in a given case, with the balance heavily weighted in favor of the exercise of
jurisdiction.” Fox v. Maulding, 16 F.3d 1079, 1082 (10th Cir. 1994). T he Magistrate
Judge here recommended declining to exercise jurisdiction pursuant to Colorado River,
finding that the instant action and the Foreclosure Proceeding are parallel, and that the
majority of the requisite factors for consideration weigh in favor of abstention. (ECF No.
39 at 7-11.)
Plaintiff does not dispute that the proceedings are parallel—indeed, Plaintiff
conceded this in her response to the Motion to Dism iss (ECF No. 115 at 6)—but argues
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that the Colorado River factors all weigh against abstention. (ECF No. 128 at 9-15.) As
for the first factor, the Magistrate Judge found it inconclusive because this Court’s
jurisdiction over the Property had remained in question since the early stages of this
case, and the Court had taken no action over the Property. (ECF No. 117 at 15.) The
Court has reviewed the authority Plaintiff cites and finds that it does not conclusively
establish whether the court with the first-filed case regarding real property necessarily
assumes jurisdiction over that property on the date the case was filed. See, e.g., Penn
Gen. Cas. Co. v. Pennsylvania ex rel. Schnader, 294 U.S. 189, 196 (1935). For the
purposes of this analysis, however, the Court will assume that because this action was
filed before the Foreclosure Proceeding, this Court first assumed jurisdiction over the
Property. Accordingly, the first factor weighs in favor of the exercise of jurisdiction.
The parties agree that the second factor, the inconvenience to the parties of the
federal forum, is irrelevant to this case, and is thus neutral in the balancing test. (ECF
Nos. 128 at 12; 129 at 10.) However, the parties take opposing positions as to the third
factor, the avoidance of piecemeal litigation. (Id.) This element is arguably the central
factor guiding application of the Colorado River doctrine, as it is directly connected to
the goal of preserving judicial economy. “It is well-established that ‘federal courts have
the power to refrain from hearing,’ among other things, ‘cases which are duplicative of a
pending state proceeding.’ This latter principle—the avoidance of duplicative
litigation—is at the core of the Colorado River doctrine.” D.A. Osguthorpe Family P’ship
v. ASC Utah, Inc., 705 F.3d 1223, 1233 (10th Cir. 2013), cert. denied, 133 S. Ct. 2831
(2013) (quoting Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 716-17 (1996)); see
also Moses H. Cone, 460 U.S. at 16 (danger of piecemeal litigation was “paramount”
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consideration in Colorado River).
In the instant case, as the Magistrate Judge noted, “any order regarding title to
the subject property might interfere with a state court order regarding the same
property.” (ECF No. 117 at 19.) Now that the Foreclosure Proceeding has advanced to
judgment and is pending appeal, the Court could not rule on Plaintif f’s quiet title claim
without risking direct interference with a state judgment, and possibly inconsistent
results. Plaintiff disagrees, citing Third Circuit cases holding that “the ‘avoidance of
piecemeal litigation’ factor is met . . . only when there is evidence of a strong federal
policy that all claims should be tried in the state courts.” Ryan v. Johnson, 115 F.3d
193, 197-98 (3d Cir. 1997). However, Plaintiff has provided nothing on which the Court
can rely to import this interpretation to this circuit. Defendant points out that the Tenth
Circuit has applied this factor “by its plain terms”, and the Court agrees. (See ECF No.
129 at 11 n.36.) Consequently, due to the substantial risk of piecemeal litigation were
this action to continue, the Court finds that this factor weighs heavily against exercising
jurisdiction.
When evaluating the fourth factor, the order in which the courts obtained
jurisdiction, “priority should not be measured exclusively by which complaint was filed
first, but rather in terms of how much progress has been made in the two actions.”
Moses H. Cone, 460 U.S. at 3 (finding that “no substantial proceedings had taken place
in the state suit at the time of the District Court’s stay order, whereas in the federal suit
the parties had taken most of the steps necessary to a resolution of the arbitrability
issue.”). The Foreclosure Proceeding has now advanced through trial to a judgment,
which is pending appeal, while the instant action, despite its age, has never proceeded
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past jurisdictional briefing. Accordingly, the Court rejects Plaintiff’s argument that the
large number of docket entries in the instant action indicate that it has m ade more
progress than the Foreclosure Proceeding. (See ECF No. 128 at 14.) This action has
remained stalled while the Foreclosure Proceeding has progressed nearly to
completion. Therefore, the Court finds that the fourth factor also weighs heavily against
exercising jurisdiction.
The parties agree that the fifth factor, the vexatious or reactive nature of the
litigation, is not relevant here, and is therefore neutral. (ECF Nos. 128 at 14; 129 at
12.) As to the sixth factor, whether federal law provides the rule of decision, the parties
agree that it does not. (Id.) Plaintiff notes that diversity cases always rely on state law,
suggesting that the Court discount the weight of this factor and call it neutral instead.
(See ECF No. 128 at 14-15.) However, Plaintiff does not explain why a pertinent factor
identified for consideration by the Supreme Court should be so casually dismissed
merely because it may apply in a large swath of cases. Moreover, as a practical matter,
the presence of federal claims would counsel in favor of exercising jurisdiction, while
the lack of such claims renders more reasonable a court’s decision to decline
jurisdiction. The Court declines Plaintiff’s invitation to ignore the sixth factor, and finds
that it weighs against exercising jurisdiction.
Finally, the seventh factor considers whether the Foreclosure Proceeding is an
adequate forum for Plaintiff’s claims. Plaintiff does not argue that the Foreclosure
Proceeding is an inadequate forum, but instead cites a Fifth Circuit case for the
proposition that this factor can never weigh against the exercise of jurisdiction. (Id. at
15 (quoting from Evanston Ins. Co. v. Jimco, Inc., 844 F.2d 1185, 1193 (5th Cir. 1988).)
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However, Evanston Insurance does not explain its reasoning, stating only that “it is
clear from its nature that [the seventh factor] can only be a neutral factor or one that
weighs against, not for, abstention.” 844 F.2d at 1193. Apart f rom this citation, Plaintiff
provides no additional argument that this factor weighs in favor of exercising
jurisdiction. Accordingly, the Court finds that the Foreclosure Proceeding is an
adequate forum to hear Plaintiff’s claims, and thus the seventh factor weighs against
exercising jurisdiction.
The Court is well-advised to be cautious in exercising its discretion, and to limit
abstention under Colorado River to the rare exceptional case; yet such “circumstances,
though exceptional, do nevertheless exist.” Colorado River, 424 U.S. at 818. Even
assuming that the first factor weighs in favor of exercising jurisdiction under Colorado
River, the Court finds that all remaining factors pertinent to this case weigh against the
exercise of jurisdiction, and the “core” factor, avoidance of piecemeal litigation, weighs
heavily against exercising jurisdiction. Therefore, the Court concludes that this case is
such an exceptional circumstance as to warrant Colorado River abstention.
Having determined that abstention under Colorado River is appropriate, the
Court must choose whether to stay the case pending the resolution of the state
proceedings, or alternatively whether to dismiss. Where it is possible that “the state
court proceedings [may] not resolve all the federal claims, a stay preserves an available
federal forum in which to litigate the remaining claims, without the plaintiff having to file
a new federal action.” Fox, 16 F.3d at 1083. In this case, because Plaintif f asserted no
federal claims, the availability of the federal forum need not be preserved.
Accordingly, the Court adopts the Recommendation as to the Colorado River
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analysis, grants Defendant’s Motion, and dismisses Plaintiff’s claims without prejudice.
Because an amended final judgment shall be entered from which Plaintiff may appeal,
Plaintiff’s request for certification for interlocutory appeal under 28 U.S.C. § 1291 is
denied as moot.
IV. CONCLUSION
For the reasons set forth above, the Court ORDERS as follows:
1.
Plaintiff’s Motion to Alter or Amend Judgment Pursuant to Fed. R. Civ. P. 59(e),
Or Alternatively to Certify Issues for Interlocutory Appeal Pursuant to 28 U.S.C.
§ 1291 (ECF No. 128) is GRANTED IN PART as to the Younger abstention
doctrine and DENIED IN PART in all other respects;
2.
The Court’s Order Adopting the February 21, 2014 Recommendation of the
Magistrate Judge and Granting Defendant’s Motion to Dismiss (ECF No. 126) is
VACATED;
3.
The February 21, 2014 Recommendation of the Magistrate Judge (ECF No. 117)
is ADOPTED IN PART as to the Colorado River doctrine and REJECTED IN
PART as to the Younger abstention doctrine;
4.
Defendant’s Motion to Dismiss Third Amended Complaint (ECF No. 110) is
GRANTED; and
5.
An amended judgment against Plaintiff and in favor of Defendant shall issue.
Defendant shall have its costs.
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Dated this 19th day of March, 2015.
BY THE COURT:
William J. Martínez
United States District Judge
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