Mather et al v. First Hawaiian Bank et al

Filing 23

ORDER DISMISSING ACTION re 13 - Signed by CHIEF JUDGE SUSAN OKI MOLLWAY on 1/12/2015. "The court dismisses this action based on the Rooker-Feldman doctrine. The court therefore does not reach the other arguments raised by Defendants in their motion to dismiss. Although the court would normally give a pro se litigant leave to file an amended pleading, it does not do so here. The present action is a continuation of an earlier case dismissed by this co urt. See Civ. No. 14-00091 SOM/RLP. Given Mather's numerous attempts to file complaints (in the earlier case and in this case) related to the state court's orders and judgments concerning the foreclosure of loans secured by mortg ages on the Dole Street property, the court concludes that any attempt by Mather to amend her Complaint to assert claims concerning the foreclosure of the loan secured by the Dole Street property would be futile. The Clerk of Court is directed to enter judgment in favor of Defendants and to close this case." (emt, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Diane Mather served by first class mail at the address of record on January 12, 2015.

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
DIANE E. MATHER,

)
)
Plaintiff,
)
)
vs.
)
)
FIRST HAWAIIAN BANK; JONATHAN )
W.Y. LAI; and DAVID Y.
)
NAKASHIMA,
)
)
Defendants.
)
_____________________________ )

CIVIL NO. 14-00429 SOM/RLP
ORDER DISMISSING ACTION

ORDER DISMISSING ACTION
I.

INTRODUCTION.
This case arises out of loans made by Defendant First

Hawaiian Bank to Plaintiff Diane E. Mather.
stranger to this court.

Mather is no

She has been declared a vexatious

litigant by another judge in this district, having filed what
amount to frivolous appeals of various state court foreclosure
proceedings.

See ECF No. 48 in Civ. No. 14-00384 HG/KSC

The present case, a continuation of an earlier case
dismissed by this court, involves loans secured by real property
located on Dole Street in Honolulu.
Mather’s First Amended Original Petition, filed in the
present action on September 29, 2014, alleges that First Hawaiian
Bank, in conjunction with the attorneys representing it in statecourt foreclosure proceedings, Defendants Jonathan W.Y. Lai and

David Y. Nakashima, “manufactured evidence of indebtedness and
used allegedly false evidence of indebtedness” to take her
property, thus violating the federal Racketeer Influenced and
Corrupt Organizations Act (“RICO”).
32.

See ECF No. 5, PageID #s 31-

In a filing on November 5, 2014, Mather clarified that her

RICO claim is based on First Hawaiian Bank’s foreclosure on the
Dole Street property.

See ECF No. 18.

In other words, Mather is

asserting in her current RICO claim that, in the state-court
foreclosure proceedings, First Hawaiian Bank and its attorneys
presented a false note and mortgage to the state court. Because
that a claim essentially seeks to have this court reverse the
state court’s determination that the loan documents were valid
and enforceable, the claim is barred by the Rooker-Feldman
doctrine.
II.

Accordingly, Defendants’ motion to dismiss is granted.
STANDARD.
In relevant part, Defendants’ motion challenges this

court’s jurisdiction, arguing that the Rooker-Feldman doctrine
precludes the exercise of subject matter jurisdiction over this
case.
A motion to dismiss for lack of subject matter
jurisdiction under Rule 12(b)(1) may either attack the
allegations of the complaint as insufficient to confer upon the
court subject matter jurisdiction, or attack the existence of
subject matter jurisdiction in fact.

2

Thornhill Publ’g Co. v.

Gen, Tel. & Elecs. Corp., 594 F.2d 730, 733 (9th Cir. 1979).
When the motion to dismiss attacks the allegations of the
complaint as insufficient to confer subject matter jurisdiction,
all allegations of material fact are taken as true and construed
in the light most favorable to the nonmoving party.

Fed’n of

African Am. Contractors v. City of Oakland, 96 F.3d 1204, 1207
(9th Cir. 1996).

When the motion to dismiss is a factual attack

on subject matter jurisdiction, however, no presumptive
truthfulness attaches to the plaintiff’s allegations, and the
existence of disputed material facts will not preclude the trial
court from evaluating for itself the existence of subject matter
jurisdiction in fact.

Thornhill, 594 F.2d at 733

Defendants’ motion to dismiss is a factual attack on
this court’s subject matter jurisdiction, as it asks the court to
examine Mather’s extensive history of litigation concerning First
Hawaiian Bank’s loans to her that were secured by the Dole Street
property and to determine that Mather is essentially appealing
the state-court foreclosure proceedings to this court.

On this

motion, the court may accept and evaluate evidence to determine
whether jurisdiction exists.

See McCarthy v. United States, 850

F.2d 558, 560 (9th Cir. 1988) (“when considering a motion to
dismiss pursuant to Rule 12(b)(1) the district court is not
restricted to the face of the pleadings, but may review any
evidence, such as affidavits and testimony, to resolve factual

3

disputes concerning the existence of jurisdiction”); Biotics
Research Corp. v. Heckler, 710 F.2d 1375, 1379 (9th Cir. 1983)
(consideration of material outside the pleadings does not convert
a Rule 12(b)(1) motion into a motion for summary judgment).
III.

BACKGROUND FACTS.
This case is a continuation of Civil No. 14-00091

SOM/RLP, a case in which this court entered judgment against
Mather with respect to her attempt to appeal from state-court
foreclosure rulings related to the Dole Street property.

Given

the paucity of factual assertions in the First Amended Complaint
in this matter, the court takes judicial notice of the pleadings
and facts in that earlier case and in the state-court
proceedings.
On or about September 25, 2008, First Hawaiian Bank
lent Mather $686,000, which was secured by a mortgage on property
located on Dole Street in Honolulu.

First Hawaiian Bank

ultimately foreclosed on this property in state-court
proceedings.

See Complaint ¶¶ 27, 29, 38, Civil No. 14-00091

SOM/RLP; Findings of Fact, Conclusions of Law and Order Granting
Plaintiff’s Motion for Summary Judgment as to All Claims and All
Parties, Interlocutory Decree of Foreclosure and Order of Sale
¶ 4, Civ. No. 12-1-3080 (Haw. Cir. Ct. Aug. 23, 2013), ECF No. 911 in Civil No. 14-00091 SOM/RLP, PageID # 400; and ECF No. 13-4,
PageID # 119 (“Interlocutory Decree of Foreclosure”).

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On or about November 5, 2008, First Hawaiian Bank also
extended to Mather a line of credit of up to $20,000, which was
secured by a second mortgage on the Dole Street property.

First

Hawaiian Bank also foreclosed on this line of credit in state
court.

See Complaint ¶¶ 28, 29, 38, Civil No. 14-00091 SOM/RLP.
First Hawaiian Bank had previously initiated a state-

court special proceeding concerning the September 2008 $686,000
loan.

On August 9, 2012, the Circuit Court of the First Circuit,

State of Hawaii, entered Findings of Fact, Conclusions of Law and
Order Granting Petitioner’s Motion for Summary Judgment and Order
to Expunge Various Instruments Against Karen Mary Schaefer, S.P.
No. 12-1-0240 KKS (Haw. Cir. Ct. Aug. 9, 2012), ECF No. 9-7 in
Civil No. 14-00091 SOM/RLP, PageID # 378.

In that document, the

state court made a factual finding that Mather had recorded in
Hawaii’s Bureau of Conveyances a Notice of Dishonor and NonResponse in January 2012 that claimed that, if First Hawaiian
Bank failed to respond to the notice within three days, the
$686,000 note (along with another note for a separate $224,000
loan) would be null and void.

Id., PageID # 382.

According to

the state-court order, several days later, Karen Schaefer, who is
apparently a notary, recorded a Certificate of Dishonor that
claimed the notes were “null and void” and that First Hawaiian
Bank owed Mather $1,459,703.35.

Id., PageID # 383.

According to

the description in the state-court order, Mather then filed a

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Satisfaction of Mortgage and a Release and Discharge of Mortgage
Lien, as well as a UCC Financing Statement that purportedly
granted her a security interest in First Hawaiian Bank property.
See id., PageID #s 383-84.

The state-court order expunged the

various instruments filed by Schaefer.

Id., PageID # 387.

Several weeks later, Mather stipulated to the
expungement of the instruments she had filed.

See Stipulated

Order to Expunge Various Instruments, S.P. No. 12-1-0240 KKS
(Haw. Cir. Ct. Aug. 30, 2012), ECF No. 9-9 in Civil No. 14-00091
SOM/RLP, PageID # 392.
In an order of August 23, 2013, the state court
determined that Mather had defaulted on the loans made to her by
First Hawaiian Bank and that First Hawaiian Bank was entitled to
foreclose on its security interests.

Interlocutory Decree of

Foreclosure, ECF No. 9-11 in Civil No. 14-00091 SOM/RLP, PageID
# 408; ECF No. 13-4, PageID # 127.

The state court ordered the

Dole Street property to be sold via a public action by a courtappointed commissioner.
# 128.

Id., PageID # 410; ECF No. 13-4, PageID

The state court further ruled that, pursuant to Rule

54(b) of the Hawaii Rules of Civil Procedure, the Interlocutory
Decree of Foreclosure “shall be considered as a final order and
judgment and there shall be no just reason for delay.”

Id.,

PageID # 413; ECF No. 13-4, PageID # 132; see also Judgment re:
Findings of Fact, Conclusions of Law and Order Granting

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Plaintiff’s Motion for Summary Judgment as to All Claims and All
Parties, Interlocutory Decree of Foreclosure and Order of Sale,
Civ. No. 12-1-3080 (Haw. Cir. Ct. Aug. 23, 2013), ECF No. 9-12 in
Civil No. 14-00091 SOM/RLP; ECF No. 13-5.
It appears that Mather filed a Chapter 11 bankruptcy
petition.

That bankruptcy case was dismissed because Mather

failed to file required documents.

See Order Dismissing Case

with 180-Day Bar to Refiling for Failure to File Required
Documents, ECF No. 9-13 in Civil No. 14-00091 SOM/RLP, PageID
# 420; ECF No. 13-6, PageID # 139.
The Dole Street property was sold at public auction to
First Hawaiian Bank, and the state court confirmed the sale.

See

Order Granting Plaintiff’s Motion for Confirmation of Sale,
Directing Distribution of Proceeds, for Deficiency Judgment, Writ
of Possession and Disposal or Personal Property, Civ. No. 12-13080 (Haw. Cir. Ct. Mar. 21, 2014), ECF No. 21-3 in Civil No. 1400091 SOM/RLP, and Judgment re: Order Granting Plaintiff’s Motion
for Confirmation of Sale, Directing Distribution of Proceeds, for
Deficiency Judgment, Writ of Possession and Disposal or Personal
Property, Civ. No. 12-1-3080 (Haw. Cir. Ct. Mar. 21, 2014), ECF
No. 21-4 in Civil No. 14-00091 SOM/RLP.

Mather took no appeal

from any state-court foreclosure order or judgment relating to
the Dole Street property, instead turning to this court for
relief.

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On June 24, 2014, the court dismissed the Complaint in
Civil No. 14-00091 SOM/RLP, ruling that the federal claims
alleged in it were barred by the applicable limitations periods.
See ECF No. 28 in Civil No. 14-00091 SOM/RLP.

The court declined

to exercise supplemental jurisdiction over the state-law claims
asserted in the Complaint.

Id.

The court expressed concern that

Mather might be abusing the court process to delay and/or hinder
the state-court foreclosure proceedings by trying to appeal the
state court’s decisions to this court.

The court was also

concerned that Mather appeared to be asserting claims barred by
the res judicata and collateral estoppel doctrines.

Id.

The

court nevertheless granted Mather leave to file an amended
complaint no later than July 11, 2014.

Id.

Instead of filing an amended complaint in Civil No. 1400091 SOM/RLP, Mather filed a motion for leave to file an amended
complaint in the form attached as an exhibit to her motion.

See

ECF No. 33 in Civil No. 14-00091 SOM/RLP.
On August 22, 2014, the court denied that motion.
ECF No. 48 in Civil No. 14-00091 SOM/RLP.

See

The court’s concerns

that Mather might be abusing the court process turned out to be
well-founded.

The proposed amended complaint was prolix,

containing many irrelevant allegations covering 69 pages.

The

court therefore denied the motion, ruling that the proposed
amended complaint violated Rule 8(a)(2) of the Federal Rules of

8

Civil Procedure.

The court also ruled that some of the claims

were barred by the Rooker-Feldman doctrine and by the res
judicata and/or collateral estoppel doctrines.

Notwithstanding

its continuing concerns, the court gave Mather leave to file
another motion seeking leave to file an amended complaint,
requiring Mather to attach any new proposed pleading to the
motion.
12, 2014.

Any such motion was required to be filed by September
The court warned Mather that failure to timely file

such a motion would result in the automatic closure of the case.
Id.
Mather did not timely file a motion seeking leave to
file a new amended complaint.

Judgment against Mather was

therefore entered on September 15, 2014.

See ECF No. 50 in Civil

No. 14-00091 SOM/RLP.
The following day, September 16, 2014, Mather sought
post-judgment relief.
SOM/RLP.

See ECF No. 51 in Civil No. 14-00091

On September 18, 2014, this court denied that request.

See ECF No. 51 in Civil No. 14-00091 SOM/RLP.

In relevant part,

the court stated:
Mather argues that relief is warranted
because the Rooker-Feldman doctrine has been
abolished. That is simply not the case.
Mather’s case is the type of case that the
Supreme Court has expressly noted the
doctrine applies to. In Exxon Mobil Corp. v.
Saudi Basic Industries Corp., 544 U.S. 280,
284 (2005), the Supreme Court stated that the
Rooker-Feldman doctrine is confined to cases
that are brought by state-court losers
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complaining of injuries caused by state-court
judgments rendered before the commencement of
district court proceedings, and that invite
district court review and rejection of those
state-court judgments. Here, a final
judgment in the state-court foreclosure
action was entered on August 23, 2013,
pursuant to the state court’s certification
that, under Rule 54(b) of the Hawaii Rules of
Civil Procedure, its grant of summary
judgment in favor of First Hawaiian Bank and
against Mather was a final order and judgment
and that there was no just reason for delay.
See ECF No. 21-1, 21-2. Mather could have
appealed that order but chose not to do so.
Instead, about six months later, she
came to federal court, claiming, among other
things, that First Hawaiian Bank had lacked
standing to foreclose on the loans (First
Cause of Action), and seeking to quiet title
and prevent a slander of title (Fifth and
Sixth Causes of Action) as to the security
foreclosed on in state court, and to rescind
the loans that were foreclosed on in state
court (Tenth Cause of Action). See ECF
No. 1. Mather reiterated these claims in her
proposed amended complaint. See ECF No. 331. These claims directly challenged the
final judgment issued in the state-court
proceedings and were therefore barred by the
Rooker-Feldman doctrine.
Id., PageID # 1660-61.
The same order rejected Mather’s post-judgment request
to file an amended complaint asserting a RICO claim.
PageID # 1663-64.

See id.,

In response, on September 26, 2014, Mather

filed the present action, which asserts a RICO claim against
First Hawaiian Bank and the attorneys who represented it in the
state-court foreclosure proceedings.

10

See ECF No. 1.

Mather amended that complaint on September 29, 2014,
alleging that First Hawaiian Bank, in conjunction with the
attorneys representing it in the state-court foreclosure
proceedings, Defendants Jonathan W.Y. Lai and David Y. Nakashima,
“manufactured evidence of indebtedness and used false evidence of
indebtedness” to take her property.
32.

See ECF No. 5, PageID #s 31-

On November 5, 2014, Mather clarified that her RICO claim is

based on the action in which First Hawaiian Bank foreclosed on
the Dole Street property.

See ECF No. 18.

In other words,

Mather is asserting in her current RICO claim that, in the statecourt foreclosure proceedings, First Hawaiian Bank and its
attorneys presented a false note and mortgage to the state court.
IV.

ANALYSIS.
In dismissing the Complaint filed in Civil No. 14-00091

SOM/RLP, this court expressed concern that Mather may have been
improperly trying to appeal matters decided in the state-court
foreclosure proceedings to this court, which she may not do under
the Rooker-Feldman doctrine.

See D.C. Court of Appeals v.

Feldman, 460 U.S. 462, 482-86 (1983); Rooker v. Fid. Trust Co.,
263 U.S. 413, 415-16 (1923).

When Mather sought leave to file an

Amended Complaint, the court saw that its concerns were wellfounded.

In addition to violating Rule 8(a) of the Federal Rules

of Civil Procedure, Mather’s proposed First Amended Complaint in

11

that case sought to assert claims barred by the Rooker-Feldman
doctrine.
The court explained:
Under the Rooker-Feldman doctrine,
federal courts are divested of jurisdiction
to conduct a direct review of state court
judgments even when a federal question is
presented. See Bennett v. Yoshina, 140 F.3d
1218, 1223 (9th Cir. 1998. Accord Mackay v.
Pfeil, 827 F.2d 540, 543 (9th Cir. 1987)
(“Federal district courts, as courts of
original jurisdiction, may not serve as
appellate tribunals to review errors
allegedly committed by state courts”). The
Rooker-Feldman doctrine is confined to cases
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. Exxon Mobil Corp. v. Saudi Basic
Indus. Corp., 544 U.S. 280, 284 (2005).
Jurisdiction is lacking even if a state
court’s decision is challenged as
unconstitutional. Feldman, 460 U.S. at 486;
Branson v. Nott, 62 F.3d 287, 291 (9th
Cir.1995) (“As courts of original
jurisdiction, federal district courts have no
authority to review the final determinations
of a state court in judicial proceedings.
This is true even when the challenge to a
state court decision involves federal
constitutional issues”) (citations omitted).
Litigants who believe that a state judicial
proceeding has violated their constitutional
rights must appeal that decision through
their state courts and then seek review in
the Supreme Court. See Feldman, 460 U.S.
482-483; Bennett, 140 F.3d at 1223 (noting
that the rationale behind the Rooker-Feldman
doctrine “is that the only federal court with
the power to hear appeals from state courts
is the United States Supreme Court”).

12

The Rooker-Feldman doctrine does not
apply to a “general constitutional
challenge”--one that does not require review
of a final state court decision in a
particular case. See Doe & Assocs. Law
Offices v. Napolitano, 252 F.3d 1026, 1029
(9th Cir. 2001). The distinction between a
permissible general constitutional challenge
and an impermissible appeal of a state court
determination may be subtle and difficult to
make. If the federal constitutional claims
presented to the district court are
“inextricably intertwined” with the state
court’s judgment, then a plaintiff is
essentially asking this court to review the
state court's decision, which this court may
not do. Id.
See ECF No. 48 in Civil No. 14-00091 SOM/RLP, PageID #s 1634-35.
In the proposed First Amended Complaint in the earlier
action, Mather sought to assert claims of fraudulent concealment
(Second Cause of Action) and of fraud (Third Cause of Action).
The court ruled that, to the extent Mather sought to assert a
claim that First Hawaiian Bank fraudulently concealed that it was
not the owner and holder of Mather’s notes and mortgages and
therefore had no legal right to enforce those documents, that
claim was barred by the Rooker-Feldman doctrine because the state
court’s determination that First Hawaiian Bank was indeed the
owner and holder of the mortgages could not be appealed to this
court.

Id., PageID #s 1638-39.

The court stated, “Any such

challenge should have been made in the state court proceedings
and/or appealed through the state-court appellate system.”
PageID # 1639.

Id.,

Similarly, the court ruled that the Rooker-

Feldman doctrine barred the proposed fraud claim, as that claim

13

also sought to have this court reexamine the bank’s
representation that it owned the notes and mortgages at issue.
Id.
The current RICO claim asserted by Mather is based on
the same conduct as the fraud and fraudulent concealment claims
in the earlier case–-that First Hawaiian Bank and its attorneys
allegedly presented false evidence of ownership of her note and
mortgage to the state court in the foreclosure proceedings.

The

RICO claim is therefore inextricably intertwined with the state
court’s determination that First Hawaiian Bank did indeed own the
note and mortgage and that these documents were real and
enforceable.

That determination cannot be reviewed by this court

under the guise of a RICO claim that essentially seeks reversal
of the state court’s determination that First Hawaiian Bank owned
the note and mortgage and that these documents were valid and
enforceable, a determination that Mather failed to appeal.
Whether the court deems the present action to be an impermissible
appeal barred by the Rooker-Feldman doctrine or an attempt to
relitigate the issue of the enforceability of the loan documents
that was finally and necessarily determined in the state-court
foreclosure proceedings such that the collateral estoppel
doctrine would apply, Mather may not proceed with the RICO claim
she is attempting to assert here.

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V.

CONCLUSION.
The court dismisses this action based on the Rooker-

Feldman doctrine.

The court therefore does not reach the other

arguments raised by Defendants in their motion to dismiss.
Although the court would normally give a pro se litigant leave to
file an amended pleading, it does not do so here.

The present

action is a continuation of an earlier case dismissed by this
court.

See Civ. No. 14-00091 SOM/RLP.

Given Mather’s numerous

attempts to file complaints (in the earlier case and in this
case) related to the state court’s orders and judgments
concerning the foreclosure of loans secured by mortgages on the
Dole Street property, the court concludes that any attempt by
Mather to amend her Complaint to assert claims concerning the
foreclosure of the loan secured by the Dole Street property would
be futile.

The Clerk of Court is directed to enter judgment in

favor of Defendants and to close this case.
The court decides this motion without a hearing
pursuant to Local Rule 7.2(d).
IT IS SO ORDERED.
DATED: Honolulu, Hawaii, January 12, 2015.

/s/ Susan Oki Mollway
Susan Oki Mollway
Chief United States District Judge

Mather v. First Hawaiian Bank, et al, Civil No. 14-00429 SOM/RLP; ORDER
DISMISSING ACTION

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