Cichocki et al v. Bank Of America et al

Filing 37

Judge Nathaniel M. Gorton: ENDORSED MEMORANDUM & ORDER entered 1) the motion to dismiss by defendants David Frye, Robert Russo and Russo & Scolnick (Docket No. 6 ) is ALLOWED, 2) the motion to dismiss and motion for sanctions by defendants 3 1 Pinckney Street Condominium Trust & Association, Estate of Mark Keiser, Estate of Walter Jung, Elizabeth McCaan and Vicky Oleskey (Docket No. 20 ) is, with respect to dismissal, ALLOWED but is, with respect to sanctions, DENIED and 3 ) the motion to dismiss by defendant Bank of America (Docket No. 23 ) is ALLOWED. Plaintiffs are forewarned that they may be subject to sanctions if they attempt to raise or re-litigate their dismissed claims, either in this case or another case, against the condominium defendants for the same alleged conduct. So ordered. (Caruso, Stephanie) Modified on 7/21/2016 (Caruso, Stephanie).

United States District Court
District of Massachusetts
)
)
)
)
Plaintiffs,
)
)
v.
)
)
BANK OF AMERICA, VICKY R.
)
OLESKEY, ESTATE OF WALTER JUNG, )
ELIZABETH C. McCAAN, ESTATE OF
)
MARK KEISER, ROBERT D. RUSSO,
)
DAVID FRYE, RUSSO AND SCOLNICK
)
and 31 PINCKNEY STREET
)
CONDOMINIUM TRUST AND
)
ASSOCIATION,
)
)
Defendants.
)
)
TIMOTHY CICHOCKI and Y. DOLLY
HWANG,

Civil Action No.
15-13269-NMG

MEMORANDUM & ORDER
GORTON, J.
This case arises from allegations that a mortgagee bank and
several representatives of a condominium association
fraudulently imposed special assessment fees against plaintiffs.
Pending before the Court are motions to dismiss by three
sets of defendants and a motion for sanctions by one set of
defendants.

For the reasons that follow, the motions to dismiss

will be allowed and the motion for sanctions will be denied.
I.

Background and procedural history
Plaintiffs Timothy Cichocki (“Cichocki”) and Y. Dolly Hwang

(“Hwang”) (collectively, “plaintiffs”) are a married couple who
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live at a condominium unit which they purchased at 31 Pinckney
Street in Boston, Massachusetts.

They appear in this case pro

se.
Defendant Bank of America (“Bank of America”) is a banking
and financial services company which loaned plaintiffs $270,000
secured by a 15-year mortgage.

Plaintiffs refinanced and

executed a new 15-year mortgage in 2008.

They allege that Bank

of America 1) misappropriated and transferred $6,452 in funds
from their mortgage escrow account to the condominium
association, 2) increased the amount of their monthly mortgage
payments to cover the deduction of those funds and 3) attempted
to foreclose on their property after they objected.
Defendant 31 Pinckney Street Condominium Trust &
Association (“the Association”) is the manager of the
condominium units at 31 Pinckney Street.

Plaintiffs assert that

it submitted a series of “false claim[s] of debt” to Bank of
America for the purposes of extortion and retaliation.
Defendant Vicky Oleskey (“Oleskey”) is a member of the
Association who served for “almost three decades” as its
secretary and treasurer.

She allegedly conspired with the

Association to lodge “false claims of debt” against plaintiffs.
Walter Jung was a member of the Association and its
treasurer until 2009.

He died in 2011 and his estate (“Jung”)

has been named as a defendant in this action.
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Defendant Elizabeth McCaan (“McCaan”) is the co-owner of
multiple condominium units at 31 Pinckney Street and the current
treasurer of the Association.

Plaintiffs claim that she worked

with Oleskey and an attorney, on behalf of the Association, to
assess falsely claimed debts from plaintiffs’ account with Bank
of America.
Mark Keiser was married to McCaan and co-owned condominium
units with her before his death in 2014.

His estate (“Keiser”)

has also been named as a defendant.
Defendant Russo & Scolnick (“the law firm”) is the
Massachusetts law firm representing Oleskey, McCann and the
Association in Massachusetts Housing Court.

Plaintiffs claim

that the law firm filed false claims against them in the housing
court and acted as a “collection agent” for the Association, all
for the purpose of extortion.
Defendant Robert Russo (“Attorney Russo”) is a partner at
the law firm who allegedly filed the false claims against
plaintiffs in the housing court.
Defendant David Frye (“Attorney Frye”), whom the complaint
purportedly misidentifies as “Davis Frye”, is an attorney who
allegedly assisted with the filing of the false claims and made
false representations in the housing court.
Plaintiffs initiated this action in September, 2015 by
filing a complaint alleging various violations of federal law,
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Massachusetts law, the Uniform Commercial Code and a Consent
Judgment of another federal district court.
The law firm and Attorneys Russo and Frye (collectively,
“the attorney defendants”) moved to dismiss the claims against
them in December, 2015.

Oleskey, Jung, McCaan, Keiser and the

Association (collectively, “the condominium defendants”) moved
for dismissal of the claims against them, and for sanctions
against plaintiffs, in January, 2016.

Bank of America moved to

dismiss the claims against it shortly thereafter.
II.

Bank of America’s motion to dismiss
A.

Legal standard

To survive a motion to dismiss under Fed. R. Civ. P.
12(b)(6), a complaint must contain sufficient factual matter,
accepted as true, to state a claim to relief that is plausible
on its face. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007).

The court may consider documents incorporated by

reference, matters of public record and other matters subject to
judicial notice. Giragosian v. Ryan, 547 F.3d 59, 65 (1st Cir.
2008).

In assessing the merits of the motion, the court must

accept all factual allegations in the complaint as true and draw
all reasonable inferences in the plaintiff's favor. Santiago v.
Puerto Rico, 655 F.3d 61, 72 (1st Cir. 2011).

Threadbare

recitals of the legal elements, supported by mere conclusory

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statements, do not suffice to state a cause of action. Ashcroft
v. Iqbal, 556 U.S. 662, 678 (2009).
B.

Application
1.

Res judicata

Under the doctrine of res judicata, a final judgment on the
merits of a previously filed action precludes the parties from
re-litigating issues that were, or could have been, raised in
the prior action. Perez v. Volvo Car Corp., 247 F.3d 303, 311
(1st Cir. 2001).

The doctrine applies if there is 1) a final

judgment on the merits in the earlier action, 2) “sufficient
identicality” between the causes of action asserted in the
earlier and later actions and 3) “sufficient identicality”
between the parties in the two actions. Id.

A dismissal of all

claims in the prior action for failure to state a claim
constitutes a final judgment on the merits for such purposes.
AVX Corp. v. Cabot Corp., 424 F.3d 28, 30-32 (1st Cir. 2005).
The First Circuit Court of Appeals (“the First Circuit”)
adopts a broad “transactional” approach to the term “cause of
action” which it defines as
embrac[ing] all rights of the plaintiff to remedies
against the defendant with respect to all or any part of
the transaction, or series of connected transactions,
out of which the action arose.
United States v. Cunan, 156 F.3d 110, 114 (1st Cir. 1998)
(internal quotation marks omitted).

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A review of the pleadings in the public record confirms
that res judicata prevents plaintiffs from asserting their
claims against Bank of America in this action.
In 2012, plaintiffs initiated an action in this Court
against Bank of America alleging that it made an unauthorized
payment of $6,452 from plaintiffs’ mortgage escrow account to
the Association to satisfy an alleged debt, refused to assist
plaintiffs’ challenge of the validity of that debt and instead
increased the monthly mortgage payments to reflect it. Cichocki
v. Bank of Am., 2013 WL 6859027, at *2 (D. Mass. June 24, 2013).
This Court dismissed that initial complaint without prejudice
and, six months later, dismissed a “nearly identical” amended
complaint without prejudice. Id. at *2-3.

Those dismissals were

based upon plaintiffs’ continuing failure to comply with Fed. R.
Civ. P. 8 and 10. Id. at *7.
Instead of appealing the dismissals of the initial and
first amended complaints, plaintiffs filed a second amended
complaint which, after this Court accepted and adopted the
recommendation of a magistrate judge, was dismissed with
prejudice for failure to state a claim under Rule 12(b)(6). Id.
The Court expressly found that the dismissal was “a final
decision on the merits, and is thus with prejudice”, id., after
which it terminated the 2012 case.

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Plaintiffs appealed the dismissal of the second amended
complaint to the First Circuit which affirmed the dismissal in
December, 2014 for the reasons set forth in the accepted and
adopted report and recommendation.

Undeterred, plaintiffs moved

for a third time to amend their complaint in the 2012 action.
That motion was denied as moot in June, 2015 and, three months
later, plaintiffs commenced the instant action against Bank of
America and other newly named defendants with the concession
that it was “a refile of amended complaints first filed [in the
2012 case]”.
The Court finds that plaintiffs’ claims against Bank of
America in the 2012 action and in the instant action arise from
the same alleged transactions and are thus based upon
sufficiently identical causes of action.

The claims in the

prior action were dismissed with prejudice in a final judgment
on the merits.

The doctrine of res judicata, therefore, bars

all of plaintiffs’ claims against Bank of America in the instant
action.

The Court declines to consider the other arguments for

dismissal because its initial decision is dispositive.
Accordingly, the motion to dismiss by Bank of America will be
allowed and the claims against it will be dismissed.
III. The attorney defendants’ motion to dismiss
The complaint alleges that the attorney defendants violated
various federal and state criminal statutes by engaging in
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fraud, obstruction of justice, extortion, “assaults upon
property rights” and a conspiracy to commit fraud. Specifically,
the complaint claims violations of 18 U.S.C. §§ 873, 1018,
1028(7), 1343, 1344(2) and 1503 and M.G.L. c. 267 §§ 1 and 5.
Plaintiffs know full well from their previous litigious
endeavors, however, that private citizens do not have standing
to prosecute criminal violations or to initiate criminal
proceedings in their own names. Cichocki v. Mass. Bay Cmty.
Coll., 2013 WL 783068, at *6, 7 (D. Mass. Feb. 28, 2013).

Their

attempt to bring criminal claims will be dismissed with
prejudice.
Count 7 of the complaint asserts a claim under the
Massachusetts Civil Rights Act (“MCRA”), M.G.L. c. 12, § 11I.
To survive dismissal, an MCRA claim must allege 1) the exercise
or enjoyment of rights secured by the federal or state
constitutions or laws and 2) interference or attempted
interference with those rights 3) by “threats, intimidation, or
coercion.” Haufler v. Zotos, 446 Mass. 489, 504 (2006).
The sparse references to the attorney defendants in the
complaint contain no factual allegations of threatening,
intimidating or coercive behavior.

Plaintiffs claim that the

attorney defendants helped the condominium defendants to file
false claims in court under “assumed identities” and to collect
extortionate payments from Bank of America.
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Plaintiffs assert

that Attorney Frye made false representations in court and also
informed them of the intent of the Association to place a lien
against their property.

None of those assertions, even if taken

as true, allege that the attorney defendants engaged in threats,
intimidation or coercion.

Count 7 will be dismissed for failure

to state a claim.
The complaint further fails to allege sufficient facts to
support a claim against the attorney defendants under the
Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18
U.S.C. § 1961, et seq.

That is because the portions of the

complaint containing RICO-related allegations concern the
condominium defendants and refer to the attorney defendants only
to provide context.
Accordingly, the motion to dismiss by the attorney
defendants will be allowed in its entirety and the claims
against them will be dismissed.
IV.

The condominium defendants’ motion to dismiss and motion
for sanctions
A.

Motion to dismiss
1.

Criminal claims

Counts 1, 2, 4, 5, 8 and 9 allege that the condominium
defendants engaged in fraudulent, extortionate, assault-related
and conspiratorial conduct in violation of the following federal
and state criminal statutes: 18 U.S.C. §§ 876(a), 873, 1018,

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1028(7), 1343, 1344(2) and 1503; M.G.L. c. 265, § 13A and M.G.L.
c. 267, §§ 1 and 5.
Those claims will be dismissed with prejudice because, as
explained above, plaintiffs do not have standing to prosecute
criminal violations or to initiate criminal proceedings in their
own names. Mass. Bay Cmty. Coll., 2013 WL 783068, at *6, 7.
2.

Count 3

Count 3 purports to raise a claim of “attempted house
invasion and assault on property” by asserting that Oleskey and
McCann conspired with the Association to “invade” plaintiffs’
condominium unit and conduct a maintenance inspection in order
to collect evidence to use against plaintiffs in court.

The

complaint asserts that in September, 2014, 1) a man pretending
to be a firefighter convinced Hwang to let him into plaintiffs’
condominium, 2) a second man claiming to be the maintenance
manager approached the front door and asked to inspect the unit
and 3) a third man requested that Hwang let him in to inspect
the bathroom.

Hwang claims that she became suspicious and

demanded that all three men leave immediately and that the
second man said, as he was leaving, that Oleskey had sent him.
The Court construes Count 3 as a claim of conspiracy to
commit civil trespass.

A claim for civil conspiracy under

Massachusetts law requires 1) a common design or agreement
between two or more parties to perform a wrongful act and 2) a
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tortious act in furtherance of the agreement. Aetna Cas. Sur.
Co. v. P & B Autobody, 43 F.3d 1546, 1564-65 (1st Cir. 1994).

A

claim for civil trespass must establish 1) actual possession of
the property by plaintiffs, 2) intentional entry and 3) unlawful
entry. Walker v. Jackson, 56 F. Supp. 3d 89, 95 (D. Mass.
2014)(citing New England Box Co. v. C & R Const. Co., 313 Mass.
696, 707 (1943)).
Count 3 fails to state such a claim.

The complaint merely

asserts that three men attempted to enter plaintiffs’
condominium unit and that one of them claimed to do so pursuant
to authorization by Oleskey.

There is no specific factual

allegation that Oleskey, McCann and/or the Association reached
an agreement to send the three men to plaintiffs’ condominium in
order to collect evidence or that either defendant committed a
tortious act in furtherance of such a plan.
Accordingly, Count 3 will be dismissed.
3.

Count 6

Count 6 alleges that the condominium defendants
fraudulently admitted new members to the Association and new
occupants to the building which endangered the lives and
property of plaintiffs.

Defendants purportedly violated the

bylaws and past practice of the Association when they 1) failed
to notify, and seek approval from, the members of the
Association with respect to the new applicants, 2) deliberately
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concealed the existence of the new applicants and their
applications and 3) deceptively admitted the new owners and
renters.

The complaint claims that such conduct was “fraudulent

in the eye of the association by law and established practice”.
The Court construes Count 6 as a breach of contract claim.
A breach of contract must allege 1) the existence of a contract,
2) plaintiffs’ performance or willingness to perform under the
contract, 3) breach by the defendants and 4) if plaintiffs seek
damages, causation and the amount of damages. Amicas, Inc. v.
GMG Health Sys., Ltd., 676 F.3d 227, 231 (1st Cir. 2012).
Count 6 fails to state a contract claim.

As an initial

matter, the complaint does not allege the existence of a
contract between plaintiffs and the individual defendants.

The

references to the bylaws and past practice of the Association
can, at most, be construed as a contract between plaintiffs, who
purport to be members of the Association, and the Association
but not between plaintiffs and Oleskey, McCaan, Jung or Keiser.
In any event, there are no specific factual allegations with
respect to any of the condominium defendants that plaintiffs
complied, or were willing to comply, with any contractual
obligations of theirs to review and approve new applications.
With respect to the claimed amount of damages, plaintiffs submit
only vague, conclusory allegations that defendants’ conduct

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“disastrously” affected their property interests and “gravely
threatened” Hwang’s life and safety.
Accordingly, Count 6 will be dismissed.
4.

Count 7

Count 7 purports to raise an MCRA claim against the
Association, Oleskey and McCaan.

As discussed, an MCRA claim

must allege 1) the exercise or enjoyment of rights secured by
the federal or state constitutions or laws and 2) interference
or attempted interference with those rights 3) by “threats,
intimidation, or coercion.” Haufler, 446 Mass. at 504.
Plaintiffs allege that defendants interfered with their
1) “Constitutional rights to life, liberty, happiness, [and]
property”, 2) right to “feel secure [at] home” without living in
fear, 3) right to be free from unlawful prosecution by the
Association and its members, 4) right to equal treatment as
condominium owners and 5) contractual “ownership rights” to
their condominium unit.

In support, plaintiffs claim that

defendants targeted them for bullying and “prosecutions”, blamed
them for building-related problems, assigned most of the
building expenses to them and barred them from voicing their
concerns.
The MCRA claim will be dismissed with respect to the first
four asserted rights because there is no specific allegation
that those rights are protected by federal or state
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constitutions or laws.

The mere inclusion of the phrase

“Constitutional rights to life, liberty, happiness, [and]
property” does not suffice to establish a constitutionallyprotected right.

There is no attempt by plaintiffs to allege

that they have a federal or state right to live in their
condominium unit without fear or to avoid housing-related
litigation.

Conclusory allegations that plaintiffs “were

stripped of all equal rights with their fellow owners” do not,
by themselves, satisfy the first element of an MCRA claim.
The portion of the MCRA claim addressing plaintiffs’
contract rights will also be dismissed for failure to state a
claim.

Plaintiffs do not allege that the contract providing

them with “ownership rights” also protects them against
bullying, prosecution, unequal treatment and feelings of
fearfulness.

They do not allege the existence of a separate

contract protecting them against the alleged misconduct.

The

Court cannot plausibly infer that the asserted rights are
contract rights protected by Massachusetts law.
Accordingly, the MCRA claim against the condominium
defendants will be dismissed.
5.

Civil RICO claim

The Court will construe the complaint as purporting to
assert civil RICO violations, based upon an “open-ended” pattern

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of racketeering activity, pursuant to 18 U.S.C. § 1962(c)
against Oleskey, Jung, McCaan and Keiser.
a.

Elements of a RICO claim

The RICO statute provides a private right of action for
plaintiffs “injured in [their] business or property by reason of
a violation of section 1962” of the statute. 18 U.S.C.
§ 1964(c).

A civil RICO claim must allege 1) conduct 2) of an

enterprise 3) through either a pattern of racketeering activity
or the single collection of an unlawful debt. Home Orthopedics
Corp. v. Rodriguez, 781 F.3d 521, 528 (1st Cir. 2015).
The statute defines “racketeering activity” to include
criminal acts of extortion, mail fraud, wire fraud and financial
institution fraud. 18 U.S.C. § 1961(1).

A pattern of

racketeering activity requires at least two acts of racketeering
occurring within ten years. 18 U.S.C. § 1961(5).

The predicate

acts must be related and amount to, or pose a threat of,
continued criminal activity. Home Orthopedics, 781 F.3d at 528.
Continuity requires either a “closed period of repeated conduct
[amounting to] continued criminal activity” or, under the “openended” approach, “past conduct that by its nature projects into
the future with a threat of repetition”. Id.
b.

Alleged racketeering activities

Plaintiffs allege that Oleskey and Jung, in their
capacities as the Association secretary and treasurer,
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coordinated their activities for decades to reinforce their own
power, to exclude plaintiffs from participating in the
Association and to turn the other members against plaintiffs.
Oleskey and Jung purportedly made plaintiffs public targets for
harassment, intimidation and retaliation in order to punish
plaintiffs for complaining about Oleskey’s use of marijuana and
Jung’s accounting practices.
Against that backdrop, plaintiffs allege the following
instances of racketeering activity:
At some point after 2004, Oleskey and Jung billed
plaintiffs for the costs of installing a new pipe in another
unit and, through an attorney, initiated a “false debt claim”
for that expense and other bogus expenses.

The attorney

purportedly convinced Bank of America to transfer funds from
plaintiffs’ account, without their permission, to satisfy those
debts.
In 2010, Oleskey allowed a new tenant to move into Unit 3
without completing the application process.

That tenant

attempted to enter plaintiffs’ condominium without permission.
Plaintiffs believe that “someone had been into their unit
regularly while they were out” in order to commit identity fraud
against them.

Oleskey refused their requests to change the

locks to the front door of the building.

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McCaan and Keiser moved into Unit 3 in 2011 and used
Association funds to renovate their unit.

In December, 2013,

Keiser hired a construction crew to repair a broken skylight and
repaint the walls of the building.

The loud noises and dust

from the construction bothered plaintiffs.

The construction

also caused plaintiffs to lose heat to their apartment.

Keiser

initiated an action against them in the housing court for
refusing to let the construction continue.
In September, 2014, three men posed as a firefighter and
two maintenance workers in attempts to enter plaintiffs’
condominium.

Plaintiffs claim that at least one of them acted

pursuant to Oleskey’s orders.
Shortly thereafter Hwang refused Oleskey’s request to allow
a plumber to enter plaintiffs’ unit.

Oleskey allegedly

responded by initiating a lawsuit against plaintiffs under false
pretenses.

Oleskey and McCaan purportedly made false statements

in court.
In October, 2014, plaintiffs inspected the land records and
discovered that McCaan and Keiser, who plaintiffs believed had
misused Association funds, had “secretly” become the new owners
of Unit 1.

Plaintiffs ceased making their monthly payments of

Association fees.

Two months later, the Association delivered

debt collection letters to plaintiffs.

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c.

Findings by the court

The Court finds that the alleged acts, even if each
individual act qualifies as a RICO predicate, do not satisfy the
continuity requirement.
The First Circuit requires predicate acts to be related and
amount to, or pose a threat of, continued criminal activity.
Home Orthopedics, 781 F.3d at 528.

Under the open-ended

approach, plaintiffs must show that
the racketeering acts themselves include a specific
threat of repetition extending indefinitely into the
future [or] . . . are part of an ongoing entity's regular
way of doing business.
Feinstein v. Resolution Trust Corp., 942 F.2d 34, 45 (1st Cir.
1991).
Plaintiffs’ allegations that the condominium defendants’
actions resulted in falsely incurred debts do not satisfy that
standard.

There is no specific threat of repetition because the

parties are currently litigating the validity of those debts in
state court.

Any threat presented by the debt collection

efforts of the condominium defendants will dissipate once the
claims are resolved in state court.

Any threat arising from

defendants’ purported misconduct in state court will also cease
once the state proceedings are resolved. Furthermore, the
sporadic and substantively distinct nature of the identified
debt-related incidents precludes a plausible inference that

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lodging false claims of debt are part of the Association’s
“regular way of doing business”. See id.
The allegations with respect to the unauthorized entries
into plaintiffs’ condominium unit and the construction fare no
better.

The complaint claims that 1) in 2010, an individual

other than a named defendant attempted to enter the unit, 2) in
2011, Keiser hired a construction crew to perform repairs which
caused plaintiffs to suffer loud noises, dust and loss of heat
in their unit and 3) in 2014, three men attempted to enter the
unit pursuant to Oleskey’s orders.

That complaint, even when

construed liberally, does not sufficiently allege that those
three acts, which occurred over a period of many years and were
performed by different individuals under unrelated
circumstances, presented a specific threat of repetition or were
part of the Association’s “regular way of doing business”. See
id.
Accordingly, the complaint fails to state a viable RICO
claim and the motion to dismiss the RICO claims will be allowed.
B.

Motion for sanctions

The condominium defendants seek an award of attorney’s fees
to sanction plaintiffs for abusing the judicial process in bad
faith given plaintiffs’ 1) “history of pursuing spurious claims
as pro se litigants” and 2) decision to “refile” their

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previously dismissed claims here in federal court rather than to
contest the debt claims against them in state court.
The Court declines to impose sanctions at this time.

It

forewarns plaintiffs, however, that they may be subject to
sanctions if they attempt to resurrect the dismissed claims,
either through a motion to amend the complaint in this case or a
“refiled” complaint in another case, against the condominium
defendants based upon the same alleged conduct.

ORDER

For the foregoing reasons,
1)

the motion to dismiss by defendants David Frye, Robert
Russo and Russo & Scolnick (Docket No. 6) is ALLOWED,

2)

the motion to dismiss and motion for sanctions by
defendants 31 Pinckney Street Condominium Trust &
Association, Estate of Mark Keiser, Estate of Walter
Jung, Elizabeth McCaan and Vicky Oleskey (Docket No.
20) is, with respect to dismissal, ALLOWED but is,
with respect to sanctions, DENIED and

3)

the motion to dismiss by defendant Bank of America
(Docket No. 23) is ALLOWED.

Plaintiffs are forewarned that they may be subject to sanctions
if they attempt to raise or re-litigate their dismissed claims,

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either in this case or another case, against the condominium
defendants for the same alleged conduct.

So ordered.
/s/ Nathaniel M. Gorton
Nathaniel M. Gorton
United States District Judge
Dated July 21, 2016

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