Hughes v. Country Wide Home Loans et al

Filing 24

ORDER - IT IS ORDERED that the Motion to Dismiss for Failure to State a Claim on which Relief May be Granted (Rec. Doc. 11) filed by Defendants Shellpoint Mortgage Servicing and Wilmington Savings Fund Society is GRANTED. IT IS FURTHER ORDERED that t he Motion to Dismiss for Lack of Subject Matter Jurisdiction (Rec. Doc. 17) filed by Defendant Rushmore Loan Management Services is GRANTED. IT IS FURTHER ORDERED that the Motion to Dismiss for Failure to State a Claim on which Relief May be Granted (Rec. Doc. 22) filed by Defendants Bank of America Home Loans and Country Wide Home Loans is GRANTED. IT IS FURTHER ORDERED that all other pending motions are DENIED AS MOOT. Signed by Judge Jay C. Zainey on 6/14/2017. (cg)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
REONARD HUGHES

CIVIL ACTION

VERSUS

NO: 16-17623

COUNTRYWIDE HOME LOANS,
BANK OF AMERICA HOME LOANS,
RUSHMORE LOAN MANAGEMENT
SERVICES, WILMINGTON SAVINGS
FUND SOCIETY AND SHELLPOINT
MORTGAGE SERVICING

SECTION: A (2)

ORDER
Before the Court is a Motion to Dismiss for Failure to State a Claim on which Relief May
be Granted (Rec. Doc. 11) filed by Defendants Shellpoint Mortgage Servicing and Wilmington
Savings Fund Society. Also before the Court is a Motion to Dismiss for Lack of Subject Matter
Jurisdiction (Rec. Doc. 17) filed by Defendant Rushmore Loan Management Services (“Rushmore”).
Lastly before the Court is a Motion to Dismiss for Failure to State a Claim on which Relief May
be Granted (Rec. Doc. 22) filed by Defendants Bank of America Home Loans and Country Wide
Home Loans. Plaintiff has not filed a response to the motions. The Motions, set for submission on
March 8, 2017, March 22, 2017, and April 5, 2017, respectively, are before the Court on the briefs
without oral argument.
I.

Background
This matter arises out of a Louisiana state court foreclosure proceeding against Plaintiff. On

September 26, 2006, Plaintiff executed a promissory note in the amount of $136,918.00 in favor of
Defendant Countrywide Home Loans, Inc. (“Countrywide”). (Rec. Doc. 11-1, Pg. 7). The promissory
note was paraphed with a mortgage in favor of Countrywide on Plaintiff’s property at 4041 South
Windmere Street in Harvey, Louisiana 70058. (Rec. Doc. 11-2, Pg. 10). Because Plaintiff defaulted on
the note, Bank of America, Countrywide’s successor in interest, sent Plaintiff a Notice of Intent to

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Accelerate in January, 2011. (Rec. Doc. 11-2, Pg. 1). Bank of America then filed a Petition for
Foreclosure by Executory Process in July, 2011. (Rec. Doc. 11-3, Pg. 2).
On July 13, 2012 the 24th Judicial District Court of Louisiana issued an “Order of Executory
Process” directing the Clerk of Court to issue a writ of seizure and sale commanding the Sheriff of
Jefferson Parish to seize and sell Plaintiff’s mortgaged property. (Rec. Doc. 11-4). In August, 2015,
Wilmington Savings Fund Society substituted Bank of America as plaintiff in the state court
proceedings because Bank of America assigned its mortgage on Plaintiff’s property to Wilmington.
(Rec. Doc. 11-5). On March 22, 2016, Plaintiff petitioned for an injunction to arrest the foreclosure.
(Rec. Doc. 11-6). The 24th JDC denied Plaintiff’s Petition for Injunction, and allowed the Sheriff’s
sale to proceed. (Rec. Doc. 11-7). Finally, on December 20, 2016, Plaintiff filed a lawsuit in this Court
contesting the right to seizure and sale of his property, and seeking $2,500,000.00 in damages. (Rec.
Doc. 1).
II.

Analysis
Defendants Shellpoint Mortgage Servicing (“Shellpoint”) and Wilmington Savings Fund

Society (“Wilmington”) filed a Motion to Dismiss for Failure to State a Claim on which Relief May
be Granted pursuant to 12(b)(6) and 12(b)(1) of the Federal Rules of Civil Procedure. (Rec. Doc. 11).
Defendants Bank of American Home Loans (“Bank of America”) and Country Wide Home Loans filed
a Motion to Dismiss for Failure to State a Claim on which Relief May be Granted pursuant to 12(b)(1),
12(b)(5) and 12(b)(6) of the Federal Rules of Civil Procedure. (Rec. Doc. 22). Lastly, Defendant
Rushmore Loan Management Services filed a Motion to Dismiss for Lack of Subject Matter
Jurisdiction pursuant to 12(b)(1) and 12(b)(5). (Rec. Doc. 17).
In the context of a Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction, the
party asserting jurisdiction “constantly bears the burden of proof that jurisdiction does in fact exist.”
Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001). When ruling on the motion, the district
court can rely on the complaint, undisputed facts in the record, and the court's resolution of disputed
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facts. Id. A court should grant the motion only if it appears certain the plaintiff cannot prove any set of
facts that would entitle him to recovery. Home Builders Ass'n of Mississippi, Inc. v. City of Madison,
143 F.3d 1006, 1010 (5th Cir. 1998).
a. Rooker-Feldman Doctrine
Defendants Shellpoint, Wilmington, Rushmore, Bank of America and Country Wide all move
to dismiss Plaintiff’s claims, among other reasons, for lack of subject matter jurisdiction based on the
Rooker-Feldman Doctrine.
The Rooker-Feldman Doctrine “bars federal courts from adjudicating claims where the
plaintiff seeks to overturn a state-court judgment.” Truong v. Bank of America, N.A., 717 F.3d 377,
381 (5th Cir. 2013). The Supreme Court has explained that the Rooker-Feldman Doctrine is limited to
“cases brought by state-court losers complaining of injuries caused by state-court judgments rendered
before the district court proceedings commenced,” asking the district court to review and reject the
state court judgments. Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005).
The Court finds that the Rooker-Feldman Doctrine strips the Court of its subject matter
jurisdiction over this matter because Plaintiff is essentially asking this Court to review and reject the
Louisiana state court’s Order of Executory Process. The United States Court of Appeals for the Fifth
Circuit has found that the first hallmark of the Rooker-Feldman inquiry is what the court is being asked
to review. Truong v. Bank of America, N.A., 717 F.3d 377, 382 (5th Cir. 2013). The Fifth Circuit noted
that a “federal district court lacks jurisdiction ‘over challenges to state court decisions in particular
cases arising out of judicial proceedings,’” but may review non-state-court decisions. Id. (quoting
District of Columbia Court of Appeals v. Feldman, 460 U.S. 462, 486 (1983). The Order of Executory
Process, which Plaintiff seeks review and rejection of, was a state-court decision arising out of a
judicial proceeding. Therefore, Plaintiff’s claim meets the first inquiry of the Rooker-Feldman
Doctrine.

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The United States Court of Appeals for the Fifth Circuit went on to say that the “second
hallmark of the Rooker–Feldman inquiry is the source of the federal plaintiff's alleged injury.” Truong,
717 F.3d at 382. The Fifth Circuit explained, quoting the Ninth Circuit, that if the plaintiff asserts that
a state court decision was erroneous, the federal district court does not have jurisdiction, but if the
plaintiff asserts a legal wrong by an adverse party, the doctrine does not bar jurisdiction. Id. (quoting
Noel v. Hall, 341 F.3d 1148, 1164 (9th Cir. 2003)). For example, a claim that a child support order is
void is barred by the Rooker-Feldman doctrine, but a claim that defendants violated plaintiff’s
constitutional rights in enforcing an order is not barred. Id. (citing Mosley v. Bowie Cnty. Tex., 275
Fed. Appx. 327, 328–29 (5th Cir. 2008)).
As for this second hallmark of the Rooker-Feldman Doctrine, the state court’s decisions to
issue an Order of Executory Process directing the Sheriff to seize and sell the property and to deny
Plaintiff’s petition to enjoin the seizure and sale of the property are the source of Plaintiff’s injury,
invoking Rooker-Feldman. The United States Court of Appeals for the Fifth Circuit has held that a
plaintiff’s claims that a “foreclosure judgment or writ of possession was unlawful are barred by
Rooker–Feldman because he [was] complaining of injuries caused by the state court judgments.”
Morris v. Am. Home Mortg. Servicing, Inc., 443 Fed. Appx. 22, 24 (5th Cir. 2011). Plaintiff’s complaint
in this matter similarly contests whether the Louisiana court issued a “valid foreclosure, seizure and
sale.” (Rec. Doc. 1). In Morris, the plaintiff alleged “that the defendants wrongfully foreclosed on his
home and committed various misdeeds in connection with the state court foreclosure proceedings.” Id.
Plaintiff in this matter similarly alleges that Defendants initiated “wrongful filings of executory
process, foreclosure, seizure and sale, and attempted possession, reckless and illegal business
practices.” (Rec. Doc. 1). Therefore, according to the law of this Circuit, Plaintiff’s claims in this
lawsuit are barred by the Rooker-Feldman Doctrine because Plaintiff is complaining of injuries caused
by state court judgments.

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Because this Court does not have subject matter jurisdiction over this matter by virtue of the
Rooker-Feldman Doctrine, the other arguments advanced by the Defendants in support of their motions
to dismiss are moot.
Accordingly;
IT IS ORDERED that the Motion to Dismiss for Failure to State a Claim on which Relief
May be Granted (Rec. Doc. 11) filed by Defendants Shellpoint Mortgage Servicing and Wilmington
Savings Fund Society is GRANTED.
IT IS FURTHER ORDERED that the Motion to Dismiss for Lack of Subject Matter
Jurisdiction (Rec. Doc. 17) filed by Defendant Rushmore Loan Management Services is GRANTED.
IT IS FURTHER ORDERED that the Motion to Dismiss for Failure to State a Claim on
which Relief May be Granted (Rec. Doc. 22) filed by Defendants Bank of America Home Loans and
Country Wide Home Loans is GRANTED.
IT IS FURTHER ORDERED that all other pending motions are DENIED AS MOOT.
New Orleans, Louisiana this 14th day of June, 2017.

______________________________________
JAY C. ZAINEY
UNITED STATES DISTRICT JUDGE

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