Wyatt v. Safeguard Properties LLC. et al

Filing 60

ORDER denying 54 Motion to Amend/Correct; denying 56 Motion for Temporary Restraining Order; denying 58 Motion for Temporary Restraining Order and Vacating 57 Order to Show Cause. Signed by District Judge Arthur J. Tarnow. (MLan)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
LAYDELL WYATT,
LICIA HARPER

Case No. 16-13312

v.

SENIOR U.S. DISTRICT JUDGE
ARTHUR J. TARNOW

SAFEGUARD MANAGEMENT
PROPERTIES, LLC, ET AL.,

U.S. MAGISTRATE JUDGE
STEPHANIE DAWKINS DAVIS

Plaintiffs,

Defendants.
/
ORDER DENYING MOTION FOR LEAVE TO FILE AMENDED COMPLAINT [54];
DENYING MOTION FOR TEMPORARY RESTRAINING ORDER [56, 58]; AND
VACATING ORDER TO SHOW CAUSE [57]
On October 5, 2017, Plaintiffs Laydell Wyatt and Licia Harper filed a
Motion for Leave to File Amended Complaint and for Permanent Injunction and
Other Equitable Relief [54]. On October 6, 2017, Plaintiffs filed an Emergency
Motion for Temporary Restraining Order [56]. Also on that date, the Court issued
an Order for Plaintiffs to Show Cause [57] as to why this Court has subject matter
jurisdiction over issues raised in the motion. Plaintiffs filed an Amended Motion
for Permanent Injunction [58]1 on October 6, 2017 and filed a timely Response
[59] to the Order to Show Cause on October 13, 2017.

1

Motion [56] and Motion [58] are nearly identical.
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For the reasons stated below, Plaintiffs’ motions are denied and the order to
show cause is vacated.
INTRODUCTION
Before the Court is Plaintiffs’ third action in this District concerning
allegations of a fraudulent mortgage on, and wrongful eviction from, their
residence at 483 First Gregory Street.2 In the Complaint [1] of this action, Plaintiffs
alleged violations of the Fair Debt Collection Practice Act (FDCPA) against
Defendants Safeguard Properties LLC and Bjerk & Bjerk. Plaintiffs further alleged
five state law claims against Defendants Safeguard, Bjerk, and JPMCB.
On September 25, 2017, the Court issued an Order [52] which, among other
things, dismissed all of the state law claims.3 The Court also granted summary

2

The existence of a mortgage has been established by previous judicial
proceedings. In Wyatt I, Plaintiff Laydell Wyatt sought to claim that JP Morgan
Chase Bank (JPMCB) did not have a valid mortgage for the property because of
allegations of violations under the Racketeer Influence and Corrupt Organizations
Act (RICO). Estate of Wyatt v. WAMU/JP Morgan Chase Bank, No. 09-14919,
2012 WL 933289, at *3 (E.D. Mich. Mar. 20, 2012). In that case, the Court
dismissed the complaint pursuant to Fed. R. Civ. P. 12(b)(6). Id. Following that
case, JPMCB resumed foreclosure proceedings, and Plaintiff once again sought to
challenge the foreclosure proceedings. In this Court, and affirmed by the Sixth
Circuit, it was held that foreclosure was not prevented by Plaintiff’s dower interest
in the property, and that JPMCB had not violated the Real Estate Settlement
Procedures Act and the Truth in Lending Act. Wyatt v. JPMorgan Chase Bank, et
al., No. 13-14352, (E.D. Mich. Aug. 8, 2014), affirmed case no. 15-1555 (6th Cir.
April 6, 2016) (Wyatt II).
3
The Court declined to exercise supplemental jurisdiction over Plaintiffs’ state law
claims, noting that Plaintiffs may raise these claims in state court if they wish to do
so.
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judgment for Defendant Safeguard on the FDCPA claim. [Dkt. #52]. Moreover, the
Court denied Plaintiffs’ Motion for Default Judgment against Defendant Bjerk
because Defendant Bjerk had not been properly served.4 Id. The only remaining
claim in this action is the FDCPA claim against Defendant Bjerk.
I. Motion for Leave to File Amended Complaint
On October 5, 2017, Plaintiffs filed a Motion for Leave to File Amended
Complaint [54].5 Many of the allegations in the Proposed Complaint date back to
May 2009 and are nearly identical to those raised in Wyatt I and Wyatt II.
(Proposed Compl. at ¶¶ 17-75).
The primary issue that has not been previously litigated in this Court
concerns Plaintiffs’ allegations that a fraudulent sheriff’s deed was filed with the
Washtenaw County Register of Deeds. Plaintiffs submit that although the sheriff’s
deed states that the Federal Home Loan Mortgage Corporation purchased
Plaintiffs’ home at a sheriff’s sale on October 20, 2016, the sheriff’s sale did not
actually take place. Plaintiffs further submit Trott Law fraudulently claimed that
Plaintiff Wyatt abandoned her property. Id. at ¶¶ 112-24.

The Court ordered Plaintiffs to serve Defendant Bjerk within 30 days of the entry
of the Order. On October 5, 2017, Plaintiffs filed a Certificate of Service [53].
5
Before the Court is Plaintiffs’ second Motion for Leave to File Amended
Complaint. The Court denied Plaintiffs’ first such Motion [18] on November 1,
2016. [Dkt. #21].
4

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On July 14, 2017, Defendants initiated an eviction action in the 14DCA1Ann Arbor Landlord-Tenant Court (“Landlord-Tenant Court”). Id. at ¶ 129.
On August 1, 2017, Plaintiffs filed complaints against defendants with the
Department of Justice, the Federal Housing Finance Agency, and the Consumer
Financial Protection Bureau. Id. at ¶ 131.
Plaintiffs were summoned to the Landlord-Tenant Court on August 11,
August 25, and September 22, 2017. Id. at ¶ 132. On September 29, 2017, Judge
David. L. Jordon issued an order directing Plaintiffs to pay $1390.96 in
rent/escrow to the Landlord-Tenant Court, each month, beginning on October 5,
2017. Id. at ¶ 137.
In the Proposed Complaint, Plaintiffs seek to add the following claims:
Conspiracy; Violations of the Racketeer Influenced and Corrupt Organizations Act
(RICO); and Violations of the Equal Protection and Due Processes Clauses.
Moreover, Plaintiffs also seek to reinstate or add several defendants, including:
Safeguard Properties LLC; JPMCB; JP Morgan Chase & Co.; Trott Law, P.C.;
Judge David L. Jordon; John and Jane Does 1 through 100; John Doe Corporations
1 through 10; and other John Doe Entities 1-10.
Fed. R. Civ. P. 12(a)(2) provides that, when a motion to amend is filed more
than 21 days after the complaint is served, the Court may grant the motion “when

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justice so requires.” While motions to amend are frequently granted, they may be
denied for a declared reason including:
[U]ndue delay, bad faith or dilatory motive on the part of the movant,
repeated failure to cure deficiencies by amendments previously
allowed, undue prejudice to the opposing party by virtue of allowance
of the amendment, futility of amendment, etc.
Forman v. Davis, 371 U.S. 178, 182 (1962). “A proposed amendment is futile if
the amendment could not withstand a Rule 12(b)(6) motion to dismiss.” Riverview
Health Inst. LLC v. Medical Mut. of Ohio, 601 F.3d 505, 512 (6th Cir. 2010)
(internal quotation marks omitted).
Each of the counts Plaintiffs seek to add have either been raised in this
litigation or were raised previously in Wyatt I or Wyatt II, against nearly all of the
same defendants. “Under the doctrine of claim preclusion, a final judgment on the
merits of an action precludes the parties or their privies from relitigating issues that
were or could have been raised in that action.” Rivet v. Regions Bank of La., 552
U.S. 470, 476 (1998) (internal quotation marks omitted). Accordingly, Plaintiffs’
request is futile because the addition of these claims would violate principles of
claim preclusion.
To the extent that Plaintiffs seek the addition of Judge David L. Jordon as a
defendant, attempt to institute a claim of fraud, and request that the Court vacate
the escrow order and enjoin further action in the Landlord-Tenant Court, the Court
similarly denies these proposed amendments as futile.
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The Anti-Injunction Act, 28 U.S.C. § 2283, establishes “. . . an absolute
prohibition against enjoining state court proceedings, unless the injunction falls
within three specifically defined exceptions.” Martingale LLC v. City of Louisville,
361 F.3d 297, 302 (6th Cir. 2004) (internal quotation marks omitted). A district
court may issue a permanent injunction against state court proceedings only: “(1)
where Congress expressly authorizes, (2) where necessary in aid of the court’s
jurisdiction, and (3) where necessary to protect or effectuate the court’s
judgments.” Id. None of the aforementioned exceptions apply in the instant case.
In support of their argument, Plaintiffs cite to Kougasian v. TMSL, Inc., 359
F.3d 1136, 1141 (9th Cir. 2004) for the proposition that “[a] federal plaintiff can
seek to set aside a state court judgment obtained through extrinsic fraud of the
adverse party.” [Dkt. #58]. To the extent that Plaintiffs allege fraud as the cause of
the entry of the escrow order, Plaintiffs’ Motion [58] suggests that they raised this
issue, with the assistance of counsel, in proceedings in the Landlord-Tenant Court.6
The United States Supreme Court has recognized “. . . a strong federal
policy against federal-court interference with pending state judicial proceedings
absent extraordinary circumstances.” Middlesex Cnty. Ethics Committee v. Garden
State Bar Ass’n, 457 U.S. 423, 431 (1982). Plaintiffs’ allegations of fraud do not
amount to “extraordinary circumstances” that would warrant this Court’s
Plaintiff Laydell Wyatt was represented by counsel prior to the entry of the
escrow order. See Prop. Compl. at ¶ 136.

6

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interference with the state court proceedings. The Court has already declined to
exercise supplemental jurisdiction over Plaintiffs’ state law claims in this case.
Plaintiffs may seek recourse through state courts and the appellate process.
Lastly, Plaintiffs seek to amend their complaint to include John and Jane
Does 1 through 100, John Doe Corporations 1 through 10, and other John Doe
Entities 1 through 10. The Court again denies this request as futile and premature.7
Because Plaintiffs’ Proposed Complaint is, in essence, an attempt to relitigate issues already decided or pending in state court, the Court denies Plaintiffs’
Motion for Leave to File Amended Complaint [54].
II. Preliminary Injunction
In conjunction with the Proposed Complaint, Plaintiffs filed an Emergency
Motion for TRO and Permanent Injunction [56, 58].8 Plaintiffs seek a Temporary
Restraining Order: (1) directing all Defendants to refrain from enforcing the
escrow order issued on September 29, 2017; (2) ordering the immediate halt to all
proceedings in 14A-1 District Court or any other State/County Court; and (3)
directing defendants to immediately cease trespassing on Plaintiffs’ property and
As stated in the Court’s previous Order [21]: “If these Defendants were added on
at this time, it would not toll the statute of limitations nor invoke the relation back
doctrine. Cox v. Treadway, 75 F. 3d 230, 239-40 (6th Cir. 1996). There is no
reason why these parties should be added at this time, given that they will be
removed and replaced with actual named defendants once the identities are
discovered.”
8
This is Plaintiffs’ second motion for TRO in this action. The Court denied the first
motion on October 27, 2016. [Dkt. #20].
7

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all attempts to evict Plaintiffs. Because the Court has denied Plaintiffs’ Motion for
Leave to File Amended Complaint, the Court need not address the merits of
Plaintiffs’ Motion for TRO.
Accordingly,
IT IS ORDERED that Plaintiffs’ Motion for Leave to File Amended
Complaint [54] is DENIED.
IT IS FURTHER ORDERED that Plaintiffs’ Motion for Temporary
Restraining Order, Preliminary Injunction, and Permanent Injunction [56, 58] is
DENIED.
IT IS FURTHER ORDERED that the Order to Show Cause [57] is
VACATED.
SO ORDERED.

Dated: October 26, 2017

s/Arthur J. Tarnow
Arthur J. Tarnow
Senior United States District Judge

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