Colahar et al v. Wells Fargo Bank N.A. et al

Filing 11

MEMORANDUM - Signed by Judge Sue L. Robinson on 5/27/14. (rwc)

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

RUDOLPH COLAHAR and JAN'E
COLAHAR,

)
)
)
)
Plaintiffs,
)
v.
) Civil Action No. 14-426-SLR
)
WELLS FARGO BANK N.A. and
)
US BANK, NATIONAL ASSOCIATION, )
)
Defendants.
)

MEMORANDUM
1. Introduction. Plaintiffs Jan'e Colahar ("Jan'e") and Rudolph Colahar
("Rudolph") (together "plaintiffs") proceed pro se and have paid the filing fee. They filed
this lawsuit against defendants Wells Fargo Bank N.A. ("Wells Fargo") and US Bank,
National Association ("US Bank") (together "defendants") alleging the wrongful
foreclosure of real property located at 53 Hempstead Drive, Newark, Delaware,
"involving a bankruptcy discharge." (D.1. 2.) Plaintiffs challenge a judgment as "void"
and allege that "the expected end results are an offset of the balance that the alleged
bank c1aim[s] is owed on the property, even though the house was discharge[d] in
bankruptcy." (Id.

at,-r,-r 2,

12)

2. Background. On April 25, 2014, Jan'e filed a motion for an injunction and
restraining order (D.1. 5) against defendant Wells Fargo and non-party Mortgage
Contracting Services, LLC ("MCS"), opposed by MCS (D.1. 10)1 to stop them from taking
her home. Jan'e contends that Wells Fargo hired MCS to seize the property. She

1To date, the named defendants have not been served.

indicates that the "house has not been sold or auction[ed]." (D.1. 5, ,-r 4) In addition,
she contends that items have been stolen from the property and that Wells Fargo has
attempted "to have the electric company to change the bill in their name." (Id. at,-r 6)
3. In its opposition to the motion, MCS provides evidence that the real property
at issue is the subject of a foreclosure action in the Superior Court of the State of
Delaware in and for New Castle County ("Superior Court"), U.S. Bank v. Colahar, C.A.
No. N09L-11-024 JAP, that commenced on November 4,2009. (D.1. 10, Ex. A) The
property was most recently scheduled for a sheriff's sale on April 8, 2014, but the sale
was stayed when Rudolph filed a Chapter 13 petition for bankruptcy in the United
States Bankruptcy Court for the District of Maryland ("Maryland Bankruptcy Court") on
April 3, 2014, In re: Colahar, Bankr. No. 14-15282-PM (Bankr. D. Md.); (Id. at Exs. A, B,
C) During the relevant time-frame, Rudolph has filed two other bankruptcy petitions in
the Maryland Bankruptcy Court, both of which resulted in an automatic stay. See In re:
Colahar, Bankr. No. 11-25341 (Bankr. D. Md.) filed July 27,2011; In re: Colahar, Bankr.

No. 13-23620 (Bankr. D. Md.) filed August 9,2-13. On April 22,2014, the Maryland
Bankruptcy Court dismissed In re: Colahar, Bankr. No. 14-15282-PM after Rudolph
failed to pay the required filing fee. (Id. at Ex. D) In the same order, the Maryland
Bankruptcy Court terminated the automatic stay that had been imposed pursuant to 11
U.S.C. § 362(a). (Id.) Jan'e filed the instant motion on April 25,2014.
4. Plaintiffs' complaint/notice of lis pendens states that "on April 12, 2011, the
property at issue was identified by the bankruptcy trustee on grounds that there are
liens against the property of greater value then [sic] the property itself." (D.1. 2, ,-r 4)

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Records from the United States Bankruptcy Court for the District of Delaware
("Delaware Bankruptcy Court") indicate that Jan'e, like Rudolph, filed bankruptcy
proceedings during the relevant time-frame, both of which included the real property at
issue as property of the bankruptcy state; the first filed on September 13, 2010, and the
second filed on July 9,2012. See In re Colahar, Bankr. No. 10-12868-BLS (Bankr. D.
Del.); In re Colahar, Bankr. No. 12-12014-BLS (Bankr. D. Del.). In both proceedings,
the Delaware Bankruptcy Court granted relief from the automatic stay with respect to
the property at issue upon US Bank's motion and a subsequent finding that US Bank's
interest in the property was not adequately protected. The Delaware Bankruptcy Court
stated, "[US Bank] is hereby granted relief from the automatic stay, and the automatic
stay is terminated, with respect to [US Bank's] interest in the property. [US Bank] is
hereby permitted to exercise its rights under applicable non-bankruptcy law against the
property, including but not limited to foreclosure of the mortgage." In re Colahar, Bankr.
No. 10-12868-BLS (Bankr. D. Del.) at D.I. 33; In re Colahar, Bankr. No. 12-12014-BLS
(Bankr. D. Del.) at D.I. 23. Both bankruptcy proceedings filed in the Delaware
Bankruptcy Court are closed. See In re Colahar, Bankr. No.1 0-12868-BLS (Bankr. D.
Del.) at D.I. 66; In re Colahar, Bankr. No. 12-12014-BLS (Bankr. D. Del.) at D.I. 24.
5. Standard of Review. A preliminary injunction is "an extraordinary remedy
that should be granted only if (1) the plaintiff is likely to succeed on the merits;
(2) denial will result in irreparable harm to the plaintiff; (3) granting the injunction will not
result in irreparable harm to the defendant; and (4) granting the injunction is in the
public interest." NutraSweet Co. v. Vit-Mar Enterprises, Inc., 176 F.3d 151, 153 (3d Cir.

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1999) ("NutraSweet II"). The elements also apply to temporary restraining orders. See
NutriSweet Co. v. Vit-Mar Enterprises., Inc., 112 F.3d 689,693 (3d Cir. 1997)
("NutraSweet I") (a temporary restraining order continued beyond the time permissible
under Rule 65 must be treated as a preliminary injunction, and must conform to the
standards applicable to preliminary injunctions). "[F]ailure to establish any element in [a
plaintiff's] favor renders a preliminary injunction inappropriate." NutraSweet II, 176 F.3d
at 153.
6. Discussion. Jan'e seeks to restrain MCS from seizing plaintiffs' real property
located at 53 Hempstead Drive in Newark, Delaware. The property in question,
however, is the subject of a foreclosure action currently pending in the Superior Court.
MCS opposes the motion on the grounds that Jan'e has failed to meet the requisites for
injunctive relief. It further argues that, were the court to grant the motion, it would
violate the Rooker-Feldman doctrine.
7. The court turns first to the Younger abstention doctrine. Under Younger, a
federal district court must abstain from hearing a federal case which interferes with
certain state proceedings. 2 See Younger v. Harris, 401 U.S. 37 (1971). In addition,
under Younger, federal courts are prevented from enjoining pending state proceedings

absent extraordinary circumstances. 3 Middlesex Cnty. Ethics Comm. v. Garden State

2The court may raise the issue of Younger abstention sua sponte. O'Neill v. City
of Philadelphia, 32 F.3d785, n.1 (3d Cir. 1994).
3The abstention doctrine as defined in Younger V. Harris, 401 U.S. 37 (1971),
provides that federal courts are not to interfere with pending state criminal proceedings.
The Younger doctrine has been extended to civil cases and state administrative
proceedings. Middlesex County Ethics Comm. V. Garden State Bar Ass'n, 457 U.S.
423 (1982); Huffman V. Pursue Ltd., 420 U.S. 592 (1975).

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Bar Ass'n, 457 U.S. 423,437 (1982). Abstention is appropriate when: (1) there are

ongoing state proceedings that are judicial in nature; (2) the state proceedings implicate

important state interests; and (3) the state proceedings provide an adequate

opportunity to raise the federal claims. Lazaridis v. Wehmer, 591 F.3d 666, 670 (3d Cir.

2010). The doctrine applies to proceedings until all appellate remedies have been

exhausted, unless the matter falls within one of the Younger exceptions. 4 Huffman

V.

Pursue Ltd., 420 U.S. 592, 608 (1975).

8. The Younger elements have been met and none of the exceptions apply.
First, there are on-going state proceedings for the foreclosure of real property. Second,
Delaware has an important interest in resolving real estate issues, and a ruling in the
Delaware courts implicates the important interest of preserving the authority of the
state's judicial system. See e.g., Almazan

V.

1st 2nd Mortg. CO. of NJ, Inc., 2011 WL

2670871 (D.N.J. June 2,2011) (finding that the State has important interests in the
foreclosure of property under the Youngerdoctrine); Greg

V.

Pagano, 287 F. App'x 155

(3d Cir. 2008) (unpublished) (court abstained under the Younger doctrine where
plaintiffs sought a declaration that the judge was not authorized to nullify transfer of title
and for an order enjoining the sheriff from conducting a sheriff's sale.). Finally, plaintiffs

have an adequate opportunity to raise any potential claims in state court. Accordingly,
the court must abstain pursuant to Younger and its progeny. See Pennzoi! Co. v.

4Exceptions to the Younger doctrine exist where irreparable injury is "both great
and immediate," Younger, 401 U.S. at 46, where the state law is "flagrantly and patently
violative of express constitutional prohibitions," id. at 53, or where there is a showing of
"bad faith, harassment, or ... other unusual circumstances that would call for equitable
relief." Id. at 54.

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Texaco, Inc., 481 U.S. 1, 15 (1987) (stating that Younger abstention is favored even

after the plaintiffs failed to raise their federal claims in the ongoing state proceedings).
9. In addition, the Rooker-Feldman doctrine prohibits this court from maintaining
subject matter jurisdiction over Jan'e's motion which effectively seeks to vacate orders
of the Superior Court. "The Rooker-Feldman doctrine prevents the lower federal courts
from exercising jurisdiction over cases brought by 'state-court losers' challenging 'state­
court judgments rendered before the district court proceedings commenced.'" Lance v.
Dennis, 546 U.S. 459, 460 (2006) (citations omitted). The court finds that the Rooker­
Feldman doctrine claim bars Jan'e's motion because the relief she seeks would require

"(1) the federal court [to] determine that the state court judgment was erroneously
entered in order to grant the requested relief, or (2) the federal court [to] take an action
that would negate the state court's judgment ...." In re Knapper, 407 F.3d 573, 581
(3d Cir. 2005).
10. As evidenced by the docket sheet for the Superior Court case, a default
judgment was entered against plaintiffs in May 2010, and sheriff's sales of the
foreclosed property were stayed a number of times as a result of individual bankruptcy
proceeding initiated by plaintiffs in separate bankruptcy courts. The most recent
sheriff's sale, scheduled for April 8, 2014, was stayed as a result of Rudolph's most
recent bankruptcy filing, 8ankr. No. 14-15282-PM (8ankr. D. Md.). That case is now
closed, and the automatic stay has been lifted. In essence, it seems Jan'e asks the
court to determine that Superior Court rulings were erroneously entered and to grant

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relief in the form of an injunction to preclude the sheriff's sale of the foreclosed
property. This court does not have the power to grant such a request.
11. Finally, the Anti-Injunction Act prohibits federal courts from interfering with
proceedings in the state courts. "A court of the United States may not grant injunction
to stay proceedings in a State Court except as expressly authorized by Act of Congress,
or where necessary in aid of its jurisdiction, or to protect or effectuate its judgments."
28 U.S.C. § 2283. See Clark v. United States Bank Nat'l Ass'n, 2004 WL 1380166, at
*3 (E.D. Pa. June 18, 2004) ("The Anti-Injunction Act simply does not allow federal
courts to enjoin state court proceedings, including mortgage foreclosure actions, absent
the application of an exception under the statute.") (citations omitted).
12. Conclusion. For the above reasons, the court will deny the motion for an
injunction and restraining (D.1. 5). A separate order shall issue.

Dated: May

J-1

,2014

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