Dietrich v. 2010-1 CRE MI-Retail, LLC
Filing
51
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT UNDER RULE 56 OR, IN THE ALTERNATIVE, TO DISMISS UNDER RULE 12(B)(6) [#47] AND CANCELING HEARING. Signed by District Judge Gershwin A. Drain. (TBan)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
EDGAR J. DIETRICH,
Plaintiff,
Case No.: 2:15-cv-13820
Honorable Gershwin A. Drain
v.
2010-1-CRE MI-RETAIL, LLC,
Defendant.
___________________________/
ORDER GRANTING DEFENDANT’S MOTION FOR SUMMARY
JUDGMENT UNDER RULE 56 OR, IN THE ALTERNATIVE, TO DISMISS
UNDER RULE 12(B)(6) [#47] AND CANCELING HEARING
I.
INTRODUCTION
Presently before the Court is the Defendant’s Motion to Dismiss under Rule
12(b)(6), filed on August 2, 2016.
Plaintiff has failed to file a Response to
Defendant’s present motion, and the time for doing so has expired. See E.D. Mich.
L.R. 7.1(e)(1)(B)(“A response to a dispositive motion must be filed within 21 days
after service of the motion.”). Upon review of the Defendant’s present motion, the
Court finds that oral argument will not aid in the disposition of this matter.
Accordingly, the Court will resolve the present motion on the submitted brief and
will cancel the hearing set for November 1, 2016. See E.D. Mich. L.R. 7.1(f)(2).
For the reasons that follow, the Court will grant Defendant’s present motion.
II.
FACTUAL BACKGROUND
Defendant was the holder of loan documents executed by The Edgar J.
Dietrich Family Irrevocable Trust (“Borrower”), Eric Justin Dietrich and
Maplewood Custom Millwork, LLC (“Guarantors”) and Michigan Heritage Bank
pursuant to assignments from the FDIC as receiver for Michigan Heritage Bank
and from 2010-1-CRE Venture, LLC. Borrower borrowed over $450,000.00 from
Defendant’s predecessor in interest which was guaranteed by Guarantors and
secured by a mortgage on real property located at 6332 Middlebelt Road, Garden
City, Michigan 48135 (the “Property”). The Property was transferred from
Borrower to the Le Chateau Art Gallery & Custom Framing (“Art Gallery”)
subject to Defendant’s mortgage lien. Borrower and Guarantors defaulted under
their loan documents and Defendant commenced action in Wayne County Circuit
Court, case number 13-013725-CH.
Defendant sought the appointment of a
receiver over the Property and for judgment against Guarantors on their guaranties.
On March 11, 2014, Judge Sheila Ann Gibson of the Wayne County Circuit
Court entered an Order Appointing Receiver Basil T. Simon as the receiver over
the Property with the power to sell the Property. During the Wayne County
litigation, Mr. Dietrich sought to intervene in the case, which was denied on
September 15, 2014. The Receiver sold the Property following approval from the
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Wayne County Circuit Court and the Receiver was discharged on July 20, 2014.
On September 25, 2015, Plaintiff filed this case alleging violation of the
Fourth Amendment (Count I), conversion (Count II) and abuse of process (Count
III). On November 10, 2015, the Court entered an Order granting Plaintiff’s
request to proceed in forma pauperis and request for service by the United States
Marshal Service. For an unknown reason, the United States Marshal failed to
serve Defendant.
On February 29, 2016, Plaintiff filed a proof of service showing that the
Summons and a copy of the Complaint were purportedly served by first class mail
to the Defendant’s counsel. However, Defendant’s counsel never agreed to accept
service and had not discussed the matter with Plaintiff nor Defendant. Based on
Plaintiff’s representation that he had served Defendant, the Clerk of the Court
entered a default on April 13, 2016. Thereafter, Defendant retained counsel who
sent a letter to Plaintiff requesting that the default be set aside. Plaintiff failed to
respond, failed to set aside the default and has repeatedly sought entry of default
judgment, which has been denied by the Clerk of the Court. On June 27, 2016, this
Court granted Defendant’s Motion to Set Aside Default.
III.
LAW & ANALYSIS
A. Standards of Review
Federal Rule of Civil Procedure 12(b)(6) allows the court to make an
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assessment as to whether the plaintiff has stated a claim upon which relief may be
granted. See Fed. R. Civ. P. 12(b)(6). “Federal Rule of Civil Procedure 8(a)(2)
requires only ‘a short and plain statement of the claim showing that the pleader is
entitled to relief,’ in order to ‘give the defendant fair notice of what the ... claim is
and the grounds upon which it rests.’” Bell Atlantic Corp. v. Twombly, 550 U.S.
544, 555 (2007) (citing Conley v. Gibson, 355 U.S. 41, 47 (1957). Even though
the complaint need not contain “detailed” factual allegations, its “factual
allegations must be enough to raise a right to relief above the speculative level on
the assumption that all of the allegations in the complaint are true.” Ass’n of
Cleveland Fire Fighters v. City of Cleveland, 502 F.3d 545, 548 (6th Cir. 2007)
(quoting Bell Atlantic, 550 U.S. at 555).
The court must construe the complaint in favor of the plaintiff, accept the
allegations of the complaint as true, and determine whether plaintiff’s factual
allegations present plausible claims. To survive a Rule 12(b)(6) motion to dismiss,
plaintiff’s pleading for relief must provide “more than labels and conclusions, and
a formulaic recitation of the elements of a cause of action will not do.” Id.
(citations and quotations omitted). “[T]he tenet that a court must accept as true all
of the allegations contained in a complaint is inapplicable to legal conclusions.”
Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009). “Nor does a complaint suffice if
it tenders ‘naked assertion[s]’ devoid of ‘further factual enhancement.’” Id. “[A]
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complaint must contain sufficient factual matter, accepted as true, to ‘state a claim
to relief that is plausible on its face.’” Id. The plausibility standard requires “more
than a sheer possibility that a defendant has acted unlawfully.” Id. “[W]here the
well-pleaded facts do not permit the court to infer more than the mere possibility of
misconduct, the complaint has alleged–but it has not ‘show[n]’– ‘that the pleader is
entitled to relief.’” Id. at 1950.
The district court generally reviews only the allegations set forth in the
complaint in determining on whether to grant a Rule 12(b)(6) motion to dismiss,
however “matters of public record, orders, items appearing in the record of the
case, and exhibits attached to the complaint, also may be taken into account. Amini
v. Oberlin College, 259 F. 3d 493, 502 (6th Cir. 2001). Documents attached to a
defendant’s “motion to dismiss are considered part of the pleadings if they are
referred to in the plaintiff’s complaint and are central to her claim.” Id.
Federal Rule of Civil Procedure 56(a) empowers the court to render
summary judgment forthwith “if the pleadings, depositions, answers to
interrogatories and admissions on file, together with the affidavits, if any, show
that there is no genuine issue as to any material fact and that the moving party is
entitled to judgment as a matter of law." See Redding v. St. Eward, 241 F.3d 530,
532 (6th Cir. 2001). The Supreme Court has affirmed the court's use of summary
judgment as an integral part of the fair and efficient administration of justice. The
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procedure is not a disfavored procedural shortcut. Celotex Corp. v. Catrett, 477
U.S. 317, 327 (1986); see also Cox v. Kentucky Dept. of Transp., 53 F.3d 146, 149
(6th Cir. 1995).
The standard for determining whether summary judgment is appropriate is
"'whether the evidence presents a sufficient disagreement to require submission to
a jury or whether it is so one-sided that one party must prevail as a matter of law.'"
Amway Distributors Benefits Ass’n v. Northfield Ins. Co., 323 F.3d 386, 390 (6th
Cir. 2003) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986)).
The evidence and all reasonable inferences must be construed in the light most
favorable to the non-moving party. Matsushita Elec. Indus. Co., Ltd. v. Zenith
Radio Corp., 475 U.S. 574, 587 (1986); Redding, 241 F.3d at 532 (6th Cir. 2001).
"[T]he mere existence of some alleged factual dispute between the parties will not
defeat an otherwise properly supported motion for summary judgment; the
requirement is that there be no genuine issue of material fact." Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 247-48 (1986) (emphasis in original); see also National
Satellite Sports, Inc. v. Eliadis, Inc., 253 F.3d 900, 907 (6th Cir. 2001).
If the movant establishes by use of the material specified in Rule 56(c) that
there is no genuine issue of material fact and that it is entitled to judgment as a
matter of law, the opposing party must come forward with "specific facts showing
that there is a genuine issue for trial." First Nat'l Bank v. Cities Serv. Co., 391 U.S.
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253, 270 (1968); see also McLean v. 988011 Ontario, Ltd., 224 F.3d 797, 800 (6th
Cir. 2000). Mere allegations or denials in the non-movant's pleadings will not
meet this burden, nor will a mere scintilla of evidence supporting the non-moving
party. Anderson, 477 U.S. at 248, 252. Rather, there must be evidence on which a
jury could reasonably find for the non-movant. McLean, 224 F.3d at 800 (citing
Anderson, 477 U.S. at 252).
B.
Defendant’s Motion to Dismiss
In Count I, Plaintiff alleges 42 U.S.C. § 1983 unlawful taking in violation of
the Fourth Amendment. To establish a prima facie case under 42 U.S.C. § 1983, a
civil rights plaintiff must establish that: (1) the defendant acted under color of state
law; and (2) the offending conduct deprived the plaintiff of rights secured by
federal law. Bloch v. Ribar, 156 F.3d 673, 677 (6th Cir. 1998).
Defendant is a Delaware limited liability company that held a valid first
mortgage on the Property. Thus, Defendant is not a state actor and Plaintiff fails to
state a claim upon which relief may be granted.
In Count II, Plaintiff brings a conversion claim.
Under Michigan law,
common law conversion requires the following elements: (1) a distinct act of
dominion, (2) wrongfully exerted, (3) over another’s personal property. Check
Reporting Servs., Inc. v. Mich. Nat’l Bank-Lansing, 191 Mich. App. 614, 626; 478
N.W.2d 893 (1991).
The act is wrongful when it is inconsistent with the
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ownership rights of another. Id.
None of the elements required for a conversion claim are present here.
Defendant did not exert an act of dominion over the property, rather the Wayne
County Circuit Court appointed a Receiver to marshal and liquidate Defendant’s
collateral.
Second, the dominion exerted by the Receiver was not wrongful.
Finally, the alleged control was exerted over real property, not personal property.
Count II is likewise subject to dismissal under Rule 12(b)(6).
Lastly, Plaintiff’s Count III, which alleges abuse of process, is actually an
unpermitted collateral attack on the decisions of the Wayne County Circuit Court.
Plaintiff was a non-party in the Wayne County Circuit Court action. He had no
legal interest in the proceedings. He has failed to allege a colorable claim that he is
entitled to relief on his abuse of process claim.
IV.
CONCLUSION
For the reasons articulated above, Defendant’s Motion for Summary
Judgment under Rule 56 or, in the Alternative, to Dismiss under Rule 12(b)(6)
[#47] is GRANTED.
SO ORDERED.
Dated: October 25, 2016
/s/Gershwin A. Drain
GERSHWIN A. DRAIN
United States District Judge
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CERTIFICATE OF SERVICE
Copies of this Order were served upon attorneys of record on
October 25, 2016, by electronic and/or ordinary mail.
/s/ Tanya Bankston
Deputy Clerk
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