LNV Corporation v. Hook et al

Filing 438

ORDER the Plaintiff's 427 Motion to Enjoin Further Pro Se Pleadings or, in the Alternative, to Withdraw the Reference or Stay Adversary Proceeding is GRANTED in Part and DENIED WITHOUT PREJUDICE in Part. Defendants Hook and Smith's 248 Motion to Strike, for Sanctions and for Order to Show Cause is DENIED. The Plaintiff's 430 Request for a Status Conference is DENIED AS MOOT. Defendants Hook and Smith's 431 Motion for Sanctions against Plaintiff LNV Corporation and its Counsel, Duncan E. Barber and Julie A. Trent is DENIED. Defendants Hook and Smith's 432 Motion for Sanctions against the United States of America and its Counsel at the U.S. Department of Justice in Washington, DC is DENIED. Defendants Hook and Smith's 433 Request for Evidentiary Hearing on Motion for Sanctions is DENIED. ORDERED by Judge Raymond P. Moore on 4/4/2019. (cthom, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Raymond P. Moore
Civil Action No. 14-cv-00955-RM-SKC
LNV CORPORATION,
Plaintiff,
v.
M. JULIA HOOK, an individual,
THE PRUDENTIAL HOME MORTGAGE, INC.,
UNITED STATES OF AMERICA,
SAINT LUKE’S LOFTS HOMEOWNER ASSOC. INC.,
DEBRA JOHNSON, in her official capacity as the Public Trustee of the City and County of
Denver, Colorado, and
DAVID L. SMITH, an individual,
Defendants.
____________________________________________________________________________
ORDER
_____________________________________________________________________________
This matter is before the Court on the following matters: (1) Plaintiff’s Motion to Enjoin
Further Pro Se Pleadings or, in the Alternative, to Withdraw the Reference or Stay Adversary
Proceeding (the “Motion to Enjoin”) (ECF No. 427); (2) Defendants Hook and Smith’s Motion to
Strike, for Sanctions and for Order to Show Cause (the “Motion to Strike”) (ECF No. 428); (3)
Plaintiff’s Request for a Status Conference (the “Motion for Conference”) (ECF No. 430); (4)
Defendants Hook and Smith’s Motion for Sanctions against Plaintiff LNV Corporation and its
Counsel, Duncan E. Barber and Julie A. Trent (ECF No. 431); (5) Defendants Hook and Smith’s
Motion for Sanctions against the United States of America and its Counsel at the U.S. Department
of Justice in Washington, DC (ECF No. 432)1; and (6) Defendants Hook and Smith’s Request for
Evidentiary Hearing on Motions for Sanctions (the “Motion for Hearing”) (ECF No. 433). The
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The motions for sanctions are collectively referred to herein as “Motions for Sanctions.”

Court has considered the motions and any responses thereto; taken judicial notice of the court
record as well as the record before the Bankruptcy Court in Adversary Proceeding No.
18-1250-TBM (Bankr. D. Colo.) (the “Adversary Proceeding”); and is otherwise fully advised
concerning the matters at issue. Upon being fully informed the Court finds and orders as follows.
I.

The Motions
A. Motion to Enjoin and Motion to Strike
Defendants Hook and Smith (hereafter, collectively, “Defendants”) have filed the

Adversary Proceeding against Plaintiff LNV, using their Verified Answer filed in this action
(14-cv-955) as their complaint in the Adversary Proceeding (Adv. Proc. ECF No. 1 & No. 1-1).
Not surprisingly, Plaintiff requests this Court to enjoin Defendants from filing further pro se2
pleadings in this case or any other case (including the Adversary Proceeding) arising from the
same facts and claims before this Court. In the alternative, Plaintiff requests this Court to
withdraw the reference or stay the Adversary Proceeding.
Defendants’ response consists of their Motion to Strike. In that motion, Defendants argue
the Motion to Enjoin should be stricken, and sanctions entered, because (1) Plaintiff’s continuation
of this litigation allegedly violates the Bankruptcy Court’s automatic stay, discharge order, and
discharge injunction; (2) Plaintiff’s Motion to Enjoin was improperly filed during Defendant
Hook’s appeal; (3) Plaintiff’s Motion to Enjoin allegedly falsely accuses Defendants of filing a
frivolous proceeding; and (4) Plaintiff’s request for withdrawal of reference should have been filed
in the Bankruptcy Court. The Court agrees with Defendants’ last argument, but rejects the rest as
specious, and frivolous.
First, Defendants’ argument concerning any alleged violations of the Bankruptcy Court’s
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Defendants are lawyers who appear pro se.

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rules or orders have been repeatedly rejected. Defendants simply refuse to accept the Court’s
ruling, without any legal or factual basis. Next, the Tenth Circuit Court of Appeals dismissed
Defendant Hooks’ appeal on August 28, 2018; Plaintiff’s Motion to Enjoin was filed thereafter on
September 17, 2018. (ECF Nos. 426, 427.) Third, Plaintiff’s argument concerning Defendants’
filing of the Adversary Proceeding is far from false. On the contrary, Defendants are improperly
seeking to have the Bankruptcy Court hear and decide what this Court has already decided.
This leads the Court to Defendants’ last argument – where Plaintiff’s request for the
withdrawal of the reference should have been filed. This District’s Local Rules do provide that a
motion of withdrawal of reference – although to be heard by the district court – is to be filed with
the clerk of the bankruptcy court, D.C.COLO.LCivR 84.1(d)(1), but the Court finds that failure to
be insufficient to strike the request. Regardless, 28 U.S.C. § 157(d) also allows the Court to
withdraw a reference on its own motion. And, upon consideration of the record, the Court agrees
that good cause exists for the withdrawal of the reference to the Bankruptcy Court. Thus, in this
instance, the Court need not consider Plaintiff’s other argument that filing restrictions should be
entered.3 The Court denies that request without prejudice.
B. The Motion for Conference
Plaintiff requests a status conference to address the order of foreclosure and pending
motions. The pending motions, however, have now all been addressed and, as set forth in Order
on Attorney’s Fees and Costs issued concurrently with this Order, the Court is prepared to issue
the Order of Foreclosure and Judicial Sale forthwith upon the resolution of the remaining issue in
this case. Thus, this motion is denied as moot.
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The Court recognizes Plaintiff admits its Motion to Enjoin which seeks filing restrictions may need to be a
standalone motion and, if so, withdraws the alternate relief of withdrawing the reference or staying the Adversary
Proceeding. However, the Court finds withdrawal of the reference is the appropriate remedy in this instance.

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C. The Motions for Sanctions and Motion for Hearing
Defendants’ Motions for Sanctions merit no discussion. The Court finds Defendants’
legal contentions are not warranted under existing law, or by any nonfrivolous argument for
extending, modifying, or reversing existing law or for establishing new law. The Court further
finds that any evidentiary contentions, which are virtually nonexistent, are not warranted based on
the record. Accordingly, they are summarily denied. As, as they are denied, Defendants’
Motion for Hearing on their Motions for Sanctions is moot.
II.

CONCLUSION
Defendants’ papers continue to argue the same matters about their bankruptcy, its alleged

effect, and Plaintiff’s and the United States’ alleged violations of the Bankruptcy Court’s rules and
orders, all of which this Court has repeatedly rejected. The record at hand shows Defendants have
a lengthy and abusive filing history, as demonstrated by, inter alia, their two adversary
proceedings filed before the Bankruptcy Court which consist of nothing more than that which this
Court has already decided against them in this case. This Order puts Defendants on notice that if
this conduct continues, the Court will sua sponte consider entering appropriate sanctions
(including, but not limited to, filing restrictions and dismissing duplicative filings and actions) to
preclude Defendants from continuing to abuse the judicial process, waste scarce judicial resources,
and prejudice the other parties with their groundless and frivolous filings. Andrews v. Heaton,
483 F.3d 1070, 1077 (10th Cir. 2007) (Federal courts have inherent authority to regulate abusive
litigants “by imposing carefully tailored restrictions in appropriate circumstances.”).
Based on the foregoing, it is therefore ORDERED
(1) That Plaintiff Motion to Enjoin Further Pro Se Pleadings or, in the Alternative, to
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Withdraw the Reference or Stay Adversary Proceeding (ECF No. 427) is GRANTED
in that the Court will withdraw the reference of Adversary Proceeding No.
18-125-TBM, but is DENIED WITHOUT PREJUDICE as to Plaintiff’s request to
enjoin further pro se filings;
(2) That Defendants Hook and Smith’s Motion to Strike, for Sanctions and for Order to
Show Cause (ECF No. 248) is DENIED;
(3) That Plaintiff’s Request for a Status Conference (ECF No. 430) is DENIED AS
MOOT;
(4) That Defendants Hook and Smith’s Motion for Sanctions against Plaintiff LNV
Corporation and its Counsel, Duncan E. Barber and Julie A. Trent (ECF No. 431) is
DENIED;
(5) That Defendants Hook and Smith’s Motion for Sanctions against the United States of
America and its Counsel at the U.S. Department of Justice in Washington, DC (ECF
No. 432) is DENIED;
(6) That Defendants Hook and Smith’s Request for Evidentiary Hearing on Motion for
Sanctions (ECF No. 433) is DENIED; and
(7) That the Clerk shall forthwith notify the Clerk of the Bankruptcy Court of this Order.
DATED this 4th day of April, 2019.
BY THE COURT:

____________________________________
RAYMOND P. MOORE
United States District Judge
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