Pittman v. U.S. Bank National Association

Filing 25

ORDER granting Defendant U. S. Bank's 12 Motion for Judgment on the Pleadings and denying Plaintiff's 23 Motion for Leave to File a Sure-Reply. The Clerk shall close the case. Signed by Judge Richard W. Story on 03/02/15. (sk)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
GAINESVILLE DIVISION
DAVID W. PITTMAN,
Plaintiff,
v.
U.S. BANK NATIONAL
ASSOCIATION, as Trustee for
Securitized Asset Backed
Receivables LLC Trust 2006WM1,
Defendant.

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CIVIL ACTION NO.
2:14-cv-00077-RWS

ORDER
This case comes before the Court on Defendant U.S. Bank’s Motion for
Judgment on the Pleadings [12] and Plaintiff David W. Pittman’s Motion for
Leave to File a Sur-Reply [23]. After reviewing the record, the Court enters the
following order.
Background
Plaintiff commenced this suit on April 18, 2014, requesting a declaration
that he is the proper recipient of a portion of proceeds from a foreclosure sale.
Plaintiff bases his claim on a security interest arising out of two deeds secured
by the subject property, which were later assigned to him. (Compl., Dkt. [1] ¶¶

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18, 19.) Plaintiff also brings a conversion claim against Defendant for
withholding payment of the foreclosure proceeds to which Plaintiff alleges he is
entitled. (Id. ¶ 9.)
The subject of the action in this case is real property located at 19 Rose
Court, Atlanta, Georgia (“Property”). (Id. ¶ 7.) Title to the Property was vested
in Nancy Turner until the Property was foreclosed on by Defendant. (Super. Ct.
J., Dkt. [1-2] ¶ 14.) On August 26, 2005, Turner executed a security deed in
favor of Defendant’s predecessor-in-interest, WMC Mortgage Corp., to secure
debt in the amount of $850,000. (Id. ¶ 7.) The security deed was then
conveyed to Defendant on June 4, 2008. (Id.) Thereafter, Turner defaulted on
the loan, and Defendant initiated non-judicial foreclosure proceedings against
her in the Superior Court of Fulton County, Georgia on August 24, 2010.
(Compl., Dkt. [1] ¶ 9.) Defendant then sold and purchased the Property on July
2, 2012 for $1,229,047.94. (Id.)
Plaintiff alleges an interest in the Property arising from two security
deeds. (Id. ¶¶ 5, 10.) The first is a deed executed by Nancy Turner in favor of
Ben Ray Turner on October 1, 2004 for the principal amount of $100,000
(“2004 Ben Ray Turner Deed”). (Pl.’s Br. In Opp., Dkt. [20-1] at 2.) That deed
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referenced underlying debt from an earlier security deed executed by Nancy
Turner in favor of Ben Ray Turner, also for $100,000, on January 29, 1993
(“1993 Ben Ray Turner Security Deed”).1 (Compl., Dkt. [1] ¶ 5.) The second
is a security deed executed by Nancy Turner in favor of C. Hunter Tison on
October 1, 2004 to secure debt in the amount of $150,000 (“Tison Security
Deed”). (Compl., Dkt. [1-4].) Both deeds were assigned to Plaintiff on
December 14, 2007. (Pl.’s Br. in Opp., [20-1] at 2.)
In addition to initiating foreclosure proceedings against Nancy Turner, on
August 24, 2010, Defendant brought a declaratory action against Plaintiff in
the Superior Court of Fulton County to adjudicate the parties’ interests in the
Property. (Super. Ct. J., Dkt. [1-2].) Following Plaintiff’s failure to respond to
the action, the superior court entered an order of default judgment in
Defendant’s favor on January 19, 2011 (“Default Judgment”). (Id.) The
Default Judgment clarified the Property’s chain of title, placing Defendant’s
security interest as first priority and rendering “all other claims and interests as
inferior and subordinate, which are barred and foreclosed from any right, title,

1

As the superior court’s judgment notes, the 1993 Ben Ray Turner Security
Deed was satisfied as of October 1, 2004, upon execution of the 2004 Ben Ray Turner
Security Deed. (Super. Ct. Compl., Dkt. [12-6] at 25; Super. Ct. J., Dkt. [1-2] ¶ 11.)
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interest, equity, redemption and claim in the property.” (Id. ¶ 22.) Plaintiff,
however, argues that the superior court did not cancel the 2004 Ben Ray Turner
Security Deed, and thus he is entitled to excess foreclosure proceeds. (Id. ¶¶ 69.)
After the superior court issued its Default Judgment, Plaintiff filed a
motion to set aside the judgment, arguing that the Default Judgment
erroneously cancelled the Tison Security Deed, Plaintiff’s other claimed interest
in the Property, because Defendant misrepresented that deed’s satisfaction. (Id.
¶ 12.) The superior court denied that motion in an order entered on January 16,
2013. (Mot. to Set Aside J. Order, Dkt. [1-5].) Plaintiff did not seek appellate
review of any aspect of the superior court’s Default Judgment. (Compl., Dkt.
[1] ¶ 13.)
In filing this action, Plaintiff requests that this Court declare he is entitled
to a portion of the Property’s foreclosure proceeds according to his claimed
security interest in the Property, or in the alternative, to the amount of the
foreclosure proceeds in excess of Defendant’s own security interest as
adjudicated by the Default Judgment. (Id. ¶ 18.) Contingent on a finding that
Plaintiff was entitled to a portion of the foreclosure proceeds, Plaintiff requests
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that this Court find Defendant converted his funds by failing to tender the
payment due to him. Plaintiff petitions for actual, consequential, and incidental
damages, as well as for attorney’s fees, costs, and punitive damages. (Id. ¶ 22.)
Defendant moves for judgment on the pleadings under Federal Rule of Civil
Procedure (“Rule”) 12(c).
Discussion
I.

Motion for Leave to File a Sur-Reply [23]
Before addressing Defendant’s motion, the Court notes that Plaintiff filed

a Motion for Leave to File a Sur-Reply [23] in which he first explains that he
would further address the cancellation of the 2004 Ben Ray Turner Security
Deed, which Plaintiff appears to acknowledge was recorded. Still, Plaintiff
argues it was ineffective because the cancellation was recorded after he was
assigned the 2004 Ben Ray Turner Security Deed. Second, in response to
Defendant’s assertion in its Reply that there were in fact no excess foreclosure
proceeds, Plaintiff repeats his argument that he is entitled to excess proceeds,
arguing that his interest was superior to all but a $200,000 portion of the
$850,000 mortgage loan.

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“Neither the Federal Rules of Civil Procedure nor this Court’s Local
Rules authorize the filing of surreplies.” Fedrick v. Mercedes-Benz USA, LLC,
366 F. Supp. 2d 1190, 1197 (N.D. Ga. 2005) (internal citations omitted). “To
allow such surreplies as a regular practice would put the court in the position of
refereeing an endless volley of briefs.” Garrison v. N.E. Ga. Med. Ctr., Inc., 66
F. Supp. 2d 1336, 1340 (N.D. Ga. 1999) (declining to permit surreply). Rather,
surreplies typically will be permitted by the Court only in unusual
circumstances, such as where a movant raises new arguments or facts in a reply
brief, or where a party wishes to inform the Court of a new decision or rule
implicating the motion under review. See, e.g., Fedrick, 366 F. Supp. 2d at
1197 (stating that “valid reason for . . . additional briefing exists . . . where the
movant raises new arguments in its reply brief”). Here, Plaintiff fails to show
that a surreply is warranted. He does not point out any new arguments
Defendant raised in its Reply related to the 2004 Ben Ray Turner Security Deed
cancellation. And, to the extent Defendant raised a new argument about the
lack of excess foreclosure proceeds, the Court declines to consider Defendant’s
argument. Therefore, Plaintiff’s Motion for Leave to File a Sur-Reply [23] is
DENIED.
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II.

Judgment on the Pleadings Legal Standard
“Judgment on the pleadings is appropriate where no issue of material fact

remains unresolved and the moving party is entitled to judgment as a matter of
law.” Mergens v. Dreyfoos, 166 F.3d 1114, 1117 (11th Cir. 1999). “When
reviewing judgment on the pleadings, [the Court] must take the facts alleged in
the complaint as true and view them in the light most favorable to the
nonmoving party.” Id. A motion for judgment on the pleadings pursuant to
Rule 12(c) may be premised on failure to state a claim. Mills v. Fitzgerald, 668
F. Supp. 1554, 1556 n.1 (N.D. Ga. 1987) (citing FED. R. CIV. P. 12(h)).
In order to determine whether a plaintiff has stated a claim, a federal
court is to accept as true “all facts set forth in the plaintiff’s complaint.”
Grossman v. Nationsbank, N.A., 225 F.3d 1228, 1231 (11th Cir. 2000) (citation
omitted). Further, the court must draw all reasonable inferences in the light
most favorable to the plaintiff. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 55556 (2007) (internal citations omitted); Bryant v. Avado Brands, Inc., 187 F.3d
1271, 1273 n.1 (11th Cir. 1999). However, “[a] pleading that offers ‘labels and
conclusions’ or ‘a formulaic recitation of the elements of a cause of action will
not do.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550
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U.S. at 555). “Nor does a complaint suffice if it tenders ‘naked assertion[s]’
devoid of ‘further factual enhancement.’” Id.
III.

Analysis
In support of Defendant’s motion for judgment on the pleadings,

Defendant argues that: (1) “This Court lacks subject matter jurisdiction to
consider claims preciously [sic] adjudicated in state court under the RookerFeldman doctrine,” (2) “Plaintiff’s declaratory judgment claim is barred by res
judicata,” and (3) “Plaintiff’s conversion claim fails because it depends on
Plaintiff’s nonexistent interest in the Property.” (Def.’s Br. in Supp. of J. on the
Pleadings, Dkt. [12-1] at 3.)
A.

Subject Matter Jurisdiction under the Rooker-Feldman Doctrine

First, Defendant argues that Plaintiff may not ask “this Court to conduct
an appellate review of a state court judgment . . . under Rooker-Feldman”
because the state court’s Default Judgment extinguished Plaintiff’s interest in
the Property. (Def.’s Br. in Supp. of J. on the Pleadings, Dkt. [12-1] at 12.)
“The Rooker-Feldman doctrine provides that federal courts, other than
the United States Supreme Court, have no authority to review the final
judgments of state courts.” Siegel v. LePore, 234 F.3d 1163, 1172 (11th Cir.
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2000); see also D.C. Court of Appeals v. Feldman, 460 U.S. 462, 486, 103 S.
Ct. 1303, 75 L. Ed. 2d 206 (1983); Rooker v. Fidelity Trust Co., 263 U.S. 413,
415-16, 44 S. Ct. 149, 68 L. Ed. 362 (1923). This doctrine extends to claims
that are “inextricably intertwined” with a state-court judgment. Siegel, 234
F.3d at 1172. A federal claim is inextricably intertwined with a state-court
judgment “if the federal claim succeeds only to the extent that the state court
wrongly decided the issues before it.” Id. (quoting Pennzoil Co. v. Texaco,
Inc., 481 U.S. 1, 25, 107 S. Ct. 1519, 95 L. Ed. 2d 1 (1987) (Marshall, J.,
concurring)).
Plaintiff argues that he is “not seeking review of the state-court Default
Judgment” but that he is instead “seeking to enforce the security interest
specifically omitted from the Default Judgment,” referring to the 2004 Ben Ray
Turner Deed. (Pl.’s Br. in Opp., Dkt. [20] at 14; Compl., Dkt. [1-1] ¶ 8.)
However, Plaintiff’s contention that the 2004 Ben Ray Turner Security Deed
represents an existing security interest in the Property is based on an incorrect
reading of the Default Judgment.
The Default Judgment instructed the Clerk of Court to cancel four
instruments, including both the 2004 Ben Ray Turner Deed and the Tison
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Security Deed. (Id.) Though the Default Judgment identified by name the 2004
Ben Ray Turner Deed in a list of instruments to be cancelled, the book and page
number used to cross index the deed referred instead to the record of the deed’s
satisfaction, recorded on August 11, 2008.2 (Id.; Super. Ct. Compl., Dkt. [12-6]
at 86.) According to Plaintiff, the Default Judgment’s cross indexing of the
satisfaction of the deed rather than the deed itself evidences the superior court’s
intent to leave the deed undisturbed and active. (Compl., Dkt. [1] ¶ 8; Pl.’s Br.
in Opp., Dkt. [20-1] at 9.) Plaintiff maintains that because the superior court
did not intend to cancel the 2004 Ben Ray Turner Deed, he still possesses a
security interest in the Property by virtue of that deed and is thus entitled to a
payoff from the Property’s foreclosure. (Pl.’s Br. in Opp., Dkt. [20-1] at 8.)
Plaintiff further alleges that by withholding proceeds to which he was entitled,
Defendant converted Plaintiff’s property. (Compl., Dkt. [1] ¶ 22.)
In reviewing the Default Judgment, it is apparent that the state court
intended not only to cancel the Ben Ray Turner Security Deed, but it expressly
confirms that the Ben Ray Turner Security Deed was already satisfied. In

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The deed’s satisfaction indexed by the Default Judgment in Exhibit J includes
a copy of the original 2004 Ben Ray Turner Deed, including its original book and
page number. (Dkt. [12-6] at 86.)
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pointing to the deed’s satisfaction, the Default Judgment provides: “On August
11, 2008, an instrument was recorded . . . at Deed Book 47074, Page 692,
reflecting a release and cancellation of the Ben Ray Turner Security Deed.”
(Super. Ct. J., Dkt. [1-2] ¶ 9; Dkt. [12-6] at 85-88.) The Default Judgment
includes by exhibit a copy of that deed’s full satisfaction in the Fulton County
property records. (Dkt. [12-6] at 85-88.) While the court noted that Plaintiff
was assigned the Ben Ray Turner Security Deed on December 31, 2007 by an
assignment purporting to convey to Plaintiff an “interest in that certain note and
deed to secure debt dated October 1, 2004 between Nancy S. Turner as Grantor
and Ben Ray Turner as Grantee,” the court explained that “[t]he Transfer and
Assignment references the underlying debt being the 1993 indebtedness
previously cancelled.” (Super. Ct. J., Dkt. [1-2] ¶¶ 10-11.)
Further, in case there was any doubt about the court’s intent, the Default
Judgment declares that “any and all claims and interests, including those
asserted through a deed to secure debt by Ben Ray Turner, were satisfied of
record on October 4, 2004.” (Id. ¶ 17; Dkt. [12-6] at 25.) The Default
Judgment then directs “the Clerk of Court to mark as ‘cancelled’ [a number of

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instruments, including] the Ben Ray Turner Security Deed recorded in Deed
Book 47074 page 693.” (Super. Ct. J., Dkt. [1-2] ¶ 22.)
The Default Judgment thus illustrates the superior court’s overwhelming
intent to cancel any security interest in the Property stemming from the 2004
Ben Ray Turner Deed. Therefore, Plaintiff’s arguments essentially amount to
an attempt to appeal the state court’s decision regarding the interests in the
Property. In that regard, the Rooker-Feldman doctrine bars this Court from
exercising jurisdiction over any claim of interest based on the 2004 Ben Ray
Turner Security Deed. See Siegel, 234 F.3d at 1172.
Furthermore, Plaintiff’s argument that the superior court cancelled the
Tison Security Deed based on false information is also without merit, for that
issue is inextricably intertwined with the state-court judgment. Similarly, to the
extent that Plaintiff argues that the Default Judgment’s cancellation of his
interest in the Tison Security Deed represents an unconstitutional taking, that
argument also fails. (Compl., Dkt. [1] ¶ 13.) The Rooker-Feldman doctrine is
not limited to matters of state law but applies equally to attacks on state-court
judgments premised on constitutional claims, an application which protects “the
dual dignity of state and federal court decisions interpreting federal law.”
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Powell v. Powell, 80 F.3d 464, 467 (11th Cir. 1996). Here, as Plaintiff
concedes, the superior court’s Default Judgment expressly denies any security
interest in the Property stemming from the Tison Security Deed. (Pl.’s Br. in
Opp., Dkt. [20-1] at 5.) Under the Rooker-Feldman doctrine, Plaintiff is not
permitted to seek review of the Default Judgment in this Court even when such
review is premised on a constitutional claim. Although Plaintiff could have
appealed the state-court judgment, he chose not to do so, and so this Court
cannot inquire further.
B.

Plaintiff’s Claim of Conversion

Plaintiff alleges that Defendant converted funds to which Plaintiff was
entitled by failing “to account for the proceeds [Defendant] received upon the
sale of the subject property.” (Compl., Dkt. [1] ¶ 21.) Plaintiff bases this
assertion on his interest in the Property by virtue of the 2004 Ben Ray Turner
Deed, the Tison Security Deed, or both. (Id. ¶¶ 18, 19.)
To establish a prima facie claim of conversion, a plaintiff must show:
“(1) title to the property or the right of possession, (2) actual possession in the
other party, (3) demand for return of the property, and (4) refusal by the other
party to return the property.” Trey Inman & Assocs., P.C. v. Bank of Am.,
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N.A., 306 Ga. App. 451, 457 (2010). Because both of Plaintiff’s alleged
security interests in the Property were extinguished by the state court’s Default
Judgment, Plaintiff has no “title to the property or the right of possession” to
show he was entitled to proceeds from the Property’s foreclosure sale. Id.
Plaintiff thus fails to state a claim for conversion.
Conclusion
In accordance with the foregoing, Defendant U.S. Bank’s Motion for
Judgment on the Pleadings [12] is GRANTED, and Plaintiff’s Motion for
Leave to File a Sur-Reply [23] is DENIED. The Clerk shall close the case.
SO ORDERED, this 2nd

day of March, 2015.

________________________________
RICHARD W. STORY
United States District Judge

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