Machado et al v. Bank of America, N.A.
Filing
60
ORDER: Defendant Bank of America, N.A.'s Motion for Summary Judgment (Doc. # 47 ) is GRANTED. The Clerk is directed to enter a judgment of dismissal without prejudice because the Court lacks jurisdiction under the Rooker-Feldman doctrine. After entering judgment, the Clerk is directed to terminate all pending deadlines and motions and, thereafter, CLOSE the case. Signed by Judge Virginia M. Hernandez Covington on 10/17/2018. (DMD)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
LIUBERT MACHADO and ILEANA
ACOSTA,
Plaintiffs,
v.
Case No. 8:17-cv-2531-T-33AAS
BANK OF AMERICA, N.A.,
Defendant.
_____________________________/
ORDER
This matter comes before the Court upon consideration of
Defendant Bank of America, N.A.’s Motion for Summary Judgment
(Doc. # 47), filed on August 31, 2018. Plaintiffs Liubert
Machado and Ileana Acosta responded on October 4, 2018, (Doc.
# 57), and Bank of America has replied, (Doc. # 59). For the
reasons that follow, the Motion is granted, and the case is
dismissed
without
prejudice
for
lack
of
subject
matter
jurisdiction.
I.
Background
On June 27, 2017, over seventy Plaintiffs sued Bank of
America in one action in the Middle District of Florida.
Torres et al. v. Bank of Am., N.A., No. 8:17-cv-1534-T-26TBM,
(M.D. Fla. June 27, 2017)(Doc. # 1). Plaintiffs Machado and
Acosta were two of the many
1
Plaintiffs in the original
lawsuit. Plaintiffs alleged Bank of America (“BOA”) committed
common law fraud in its administration of the Home Affordable
Modification Program (“HAMP”). HAMP was implemented by the
federal government in March of 2009, to help homeowners facing
foreclosure. (Doc. # 26 at ¶ 9). BOA entered into a Servicer
Participation Agreement with the federal government in which
BOA was required to use reasonable efforts to effectuate any
modification of a mortgage loan under HAMP. (Id. at ¶ 10).
The federal government, in exchange for BOA’s participation
in HAMP, agreed to compensate BOA for part of the loss
attributable to each modification. (Id. at ¶ 11). Plaintiffs’
claims were all based on their attempts
to secure loan
modifications with BOA under HAMP.
In the original lawsuit, BOA filed a motion to dismiss
under Federal Rule of Civil Procedure 12(b)(6), (Torres Doc.
# 12), and Plaintiffs amended their complaint, (Torres Doc.
# 16). Following BOA’s second motion to dismiss, (Torres Doc.
# 17), the presiding judge severed the claims and required
Plaintiffs to sue separately, (Torres Doc. # 19). Plaintiffs
Machado and Acosta filed a separate complaint on October 30,
2017. (Doc. # 1). Three months later, on March 7, 2018,
Plaintiffs filed an Amended Complaint. (Doc. # 26).
2
The
Amended
Complaint
alleges
BOA
committed
four
fraudulent acts: (1) falsely telling Plaintiffs that “they
can’t be current on their mortgage to qualify for a HAMP loan
modification” and failing to tell Plaintiffs that they could
qualify for HAMP if default was reasonably foreseeable (“HAMP
Eligibility
requested
Claim”);
supporting
(2)
falsely
financial
telling
Plaintiffs
the
documents
Plaintiffs
had
submitted to BOA were missing (“Supporting Documents Claim”);
(3) falsely telling Plaintiffs that they were approved for a
HAMP modification and needed to start making trial payments
(“HAMP Approval Claim”); and (4) fraudulently omitting how
inspection
fees
charged
to
Plaintiffs’
account
would
be
applied (“Inspection Fee Claim”). (Id. at ¶¶ 38, 41, 48, 55).
BOA moved to dismiss (Doc. # 33), and the Court granted
that motion in part and denied it in part, (Doc. # 37). The
Court dismissed the Supporting Documents Claim, HAMP Approval
Claim, and Inspection Fee Claim with prejudice, but allowed
the HAMP Eligibility Claim to survive. (Id.).
Regarding the HAMP Eligibility Claim, Plaintiffs allege
that on January 7, 2010, a BOA representative told Plaintiffs
that a modification requires a default. (Doc. # 26 at ¶ 38).
According to Plaintiffs, a modification in fact requires
either a default or that default be “reasonably foreseeable.”
3
(Id.). Allegedly, BOA’s misrepresentation was “specifically
designed by BOA to set Plaintiffs up for foreclosure.” (Id.
at
¶
39).
Plaintiffs
allegedly
relied
on
BOA’s
misrepresentation, stopped paying their mortgage, and “fell
into default status.” (Id. at ¶ 40). They ascribe “the loss
of their home and the equity in that home” to BOA’s alleged
misrepresentation. (Id. at ¶¶ 40, 53).
BOA moved for summary judgment on August 31, 2018,
arguing, among other things, that Plaintiffs’ claim is barred
by the Rooker-Feldman doctrine. (Doc. # 47). Plaintiffs have
responded, (Doc. # 57), and BOA has replied, (Doc. # 59). The
Motion is now ripe for review.
II.
Discussion
Bank of America contends that Plaintiffs are trying to
“‘effectively nullify’ the state court foreclosure judgment”
in violation of the Rooker-Feldman doctrine. (Doc. # 47 at
17). As other judges in this District have determined in
nearly identical cases,1 the Court finds that Plaintiffs’
claim is barred by the Rooker-Feldman doctrine.
Carmenates v. Bank of America, N.A., 8:17-cv-2635-T-23JSS
(Doc. # 50); Perez v. Bank of America, N.A., 8:17-cv-2623-T23JSS (Doc. # 50); Acosta v. Bank of America, N.A., 8:17-cv2592-T-23AAS (Doc. # 55); Santos v. Bank of America, N.A.,
8:17-cv-2588-T-23MAP (Doc. # 47); Rodriguez v. Bank of
America, N.A., 8:17-cv-2583-T-23TGW (Doc. # 51); Peralta v.
1
4
“Under the Rooker–Feldman doctrine, a district court
lacks jurisdiction over claims ‘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.’” Valentine v. BAC Home Loans Servicing, L.P., 635
F. App’x 753, 756 (11th Cir. 2015)(quoting Exxon Mobil Corp.
v. Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005)). “The
doctrine
extends
to
claims
involving
issues
that
are
‘inextricably intertwined with the state court judgment,’
i.e., claims that would ‘effectively nullify’ the state court
judgment or that would ‘succee[d] only to the extent that the
Bank of America, N.A., 8:17-cv-2580-T-23MAP (Doc. # 56);
Mosquea v. Bank of America, N.A., 8:17-cv-2551-T-23TGW (Doc.
# 46); Rostgaard v. Bank of America, N.A., 8:17-cv-2538-T23CPT (Doc. # 57); Diaz v. Bank of America, N.A., 8:17-cv2537-T-23MAP (Doc. # 51); Salazar v. Bank of America, N.A.,
8:17-cv-2535-T-23AEP, (Doc. # 50); Blanco v. Bank of America,
N.A., 8:17-cv-2593-T-23JSS (Doc. # 48); Moncada v. Bank of
America, N.A., 8:17-cv-2625-T-23AEP (Doc. # 45); Ruiz v. Bank
of America, N.A., 8:17-cv-2586-T-23TGW (Doc. # 42); Zalazar
v. Bank of America, N.A., 8:17-cv-2603-T-23CPT (Doc. # 48);
Espinel v. Bank of America, N.A., 8:17-cv-2628-T-23JSS (Doc.
# 44); Garcia v. Bank of America, N.A., 8:17-cv-2602-T-23AAS
(Doc. # 46); Gonzalez v. Bank of America, N.A., 5:17-cv-519T-23PRL (Doc. # 44); Varela-Pietri v. Bank of Am., N.A., 8:17cv-2534-T-23TGW (Doc. # 50); Colon v. Bank of Am., N.A., 8:17cv-2548-T-26AAS (Doc. # 30); Clavelo v. Bank of Am., N.A.,
8:17-cv-2644-T-26TGW (Doc. # 29); Guevara v. Bank of Am.,
N.A., 8:17-cv-2550-T-24JSS (Doc. # 36); Rosselini v. Bank of
America, N.A., 8:17-cv-2584-T-24CPT (Doc. # 29).
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state court wrongly decided the issues.’” Id. at 756–57
(quoting Casale v. Tillman, 558 F.3d 1258, 1260 (11th Cir.
2009)).
“In deciding this relationship, the court focuses on the
federal claim’s relationship to the issues involved in the
state court proceeding, instead of on the type of relief
sought by the plaintiff.” Velardo v. Fremont Inv. & Loan, 298
F. App’x 890, 892 (11th Cir. 2008). “Notably, the Eleventh
Circuit and many district courts have applied the RookerFeldman doctrine to dismiss actions where a plaintiff was
seeking, in reality, to challenge state-court foreclosure
judgments.” Goldman v. HSBC Bank USA, No. 9:15-CV-80956, 2015
WL 5269809, at *1 (S.D. Fla. Sept. 10, 2015).
Plaintiffs argue that Nivia v. Nation Star Mortgage,
LLC, 620 F. App’x 822 (11th Cir. 2015), establishes that the
Rooker-Feldman doctrine is inapplicable to this case. (Doc.
# 57 at 8-9). Plaintiffs cite Nivia for the proposition that
“claims under . . . HAMP are not barred by the Rooker-Feldman
doctrine.” (Id. at 8).
On the contrary, Nivia supports the application of the
Rooker-Feldman
doctrine
to
this
fraud
case.
While
the
Eleventh Circuit held that the HAMP claim was not barred by
the Rooker-Feldman doctrine, that was largely due to the
6
timeline of that case. In Nivia, the plaintiff applied for a
HAMP modification after the state-court foreclosure judgment
was
entered.
As
the
Eleventh
Circuit
explained,
“[t]he
homeowners alleged only that the lenders failed to respond
adequately
to
their
September
2012
request
for
a
loan
modification, which could not have been at issue in the
foreclosure proceeding that concluded in December 2011.”
Nivia, 620 F. App’x at 825. Thus, Nivia does not stand for
the proposition that any claims related to the issuance of
HAMP
modifications
are
not
barred
by
the
Rooker-Feldman
doctrine.
And, importantly, the Nivia court held that the claim
under Florida’s Deceptive and Unfair Trade Practices Act
(FDUTPA) was barred. For the FDUTPA claim, the plaintiff
homeowners
alleged
the
defendant
lender
“failed
to
help
[them] . . . modify their loan[,] denying them any possibility
to
cure
their
default,
which
constitute[d]
a
deceptive
practice to the public in . . . light of the lenders’ public
representations
that
loan
modifications
were
generally
available.” Id. (internal quotation marks omitted).
The Eleventh Circuit “construe[d] this allegation to
extend beyond the lenders’ denial of the September 2012 loan
modification
request
and
to
7
include
conduct
before
the
foreclosure judgment.” Id. So, the Eleventh Circuit concluded
that, “[i]n effect, the homeowners’ claim amounts to an
equitable defense to foreclosure that they failed to raise
before the state court,” and that “success on the merits of
the FDUTPA claim would require a determination that the state
court entered the forfeiture judgment ‘wrongly,’ i.e., that
the judgment was legally invalid.” Id.
Another Eleventh Circuit case supports that the RookerFeldman doctrine bars Plaintiffs’ claim. In the district
court, a plaintiff mortgagor asserted a RICO claim against
the defendant bank that had earlier procured a foreclosure
judgment against the mortgagor in state court. Figueroa v.
Merscorp, Inc., 766 F. Supp. 2d 1305, 1308-25 (S.D. Fla.
2011), aff’d, 477 F. App’x 558 (11th Cir. 2012). The mortgagor
sought “damages arising out of the loss of his home” and
alleged that the bank had committed mail and wire fraud in
its prosecution of the state foreclosure action as part of a
“scheme” to wrongfully obtain foreclosure judgments. Id. at
1311-23.
The district court dismissed the RICO claim under the
Rooker-Feldman doctrine because that claim was “inextricably
intertwined” with the foreclosure judgment. Id. at 1323-24.
The
Eleventh
Circuit
affirmed,
8
writing:
“Figueroa
was
a
state-court loser in his state court foreclosure proceeding.
The
state
court
intertwined
with
judgment
the
formed
injury
the
complained
basis
of
of
in
or
was
Figueroa’s
instant compliant: that ‘he lost his one-half interest in his
property
and
home’
because
of
an
improper
foreclosure
proceeding.” Figueroa, 477 F. App’x at 560.
And, as the Figueroa decision suggested, the type of
damages sought in a subsequent federal court action are
significant to the Rooker-Feldman analysis. A district court
in the Southern District of Florida explained it this way:
Plaintiffs essentially seek damages that stemmed
from the loss of their home. The only way Plaintiffs
could have been damaged was if the loss of their
home was wrongful. By entering judgment in favor of
foreclosure, the state court has determined that
foreclosure was proper. Were judgment to be entered
in this case in favor of Plaintiffs, it would
necessarily follow that the state court foreclosure
was in error and, as a result, this Court cannot
grant Plaintiffs their requested relief without
disturbing the Florida foreclosure judgment.
Goldman, 2015 WL 5269809, at *2. Indeed, “[t]he only way
Plaintiff . . . could have been ‘damaged’ by the loss or
‘illegal
divestment’
of
[his]
home[]
is
if
[the]
foreclosure[] [was] wrongful.” Figueroa, 766 F. Supp. 2d at
1323.
Here,
like
in
Figueroa,
Plaintiffs
allege
a
scheme
designed to facilitate BOA acquiring a foreclosure judgment.
9
(Doc. # 26 at ¶ 39). And that scheme, consisting of a
misrepresentation concerning HAMP eligibility requirements,
caused Plaintiffs to fall into default and allowed BOA to
then obtain a foreclosure judgment. (Id. at ¶¶ 38-40). As a
result
of
that
misrepresentation
and
the
subsequent
foreclosure judgment, Plaintiffs suffered “the loss of their
home and the equity in that home” — a loss that only occurred
once the foreclosure judgment was entered. (Id. at ¶¶ 40,
53). Because the state court found that the foreclosure
leading to the loss of Plaintiffs’ home was proper, granting
damages for the loss of Plaintiffs’ home suggests entry of
the foreclosure judgment was wrongful.
“In sum, the fraud claim in this action appears a
circuitous but unmistakable attempt to impugn the validity of
the foreclosure judgment.” Varela-Pietri v. Bank of Am.,
N.A., No. 8:17-cv-2534-T-23TGW, 2018 WL 4208002, at *3 (M.D.
Fla. Sept. 4, 2018). The Court would reach the same conclusion
even if Plaintiffs were unaware of the fraud at the time of
the foreclosure. See Rosselini v. Bank of Am., N.A., 8:17cv-2584-T-24CPT (M.D. Fla. Oct. 4, 2018)(Doc. # 29 at 4)(“The
issues of the fraud in this case could have been raised in
the
state
court
foreclosure
before
final
judgment
was
entered. It would not change the result that Plaintiff alleges
10
he did not know or could not have reasonably discovered the
facts he now knows until he retained his attorney in this
case.”). Therefore, the fraud claim is barred by the RookerFeldman doctrine and the case is dismissed without prejudice
for lack of subject matter jurisdiction. See Varela-Pietri,
2018 WL 4208002, at *4 n.6 (“Because of the disposition of
the Rooker-Feldman argument (a subject-matter jurisdiction
defect), the dismissal is without prejudice.”).
Accordingly, it is
ORDERED, ADJUDGED and DECREED:
(1)
Defendant Bank of America, N.A.’s Motion for Summary
Judgment (Doc. # 47) is GRANTED.
(2)
The Clerk is directed to enter a judgment of dismissal
without prejudice because the Court lacks jurisdiction
under the Rooker-Feldman doctrine.
(3)
After
entering
terminate
all
judgment,
pending
the
Clerk
deadlines
is
and
directed
motions
to
and,
thereafter, CLOSE the case.
DONE and ORDERED in Chambers in Tampa, Florida, this
17th day of October, 2018.
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