Bank Of New York Mellon v Log Cabin Manor Homeowners Association, et al

Filing 86

ORDER granting ECF No. 75 Motion to Stay; denying without prejudice ECF Nos. 72 , 73 , 74 Motions for Summary Judgment. Case temporarily stayed until resolution of the certiorari proceedings before the USSC in Bourne Valley and/or Saticoy Bay. Signed by Judge Miranda M. Du on 4/5/2017. (Copies have been distributed pursuant to the NEF - KR)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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***

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BANK OF NEW YOUR MELLON,
Plaintiff,

ORDER

v.
LOG CABIN MANOR HOMEOWNERS
ASSOCIATION, et al.,
Defendant.

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Case No. 2:15-cv-02026-MMD-CWH

AND ALL RELATED CLAIMS

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This case arises out of a homeowner’s association (“HOA”) foreclosure and

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involves a constitutional due process challenge to Nevada Revised Statute Chapter 116’s

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notice provisions. Before the Court is Defendant/counter-claimant SFR Investment Pool

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1, LLC’s (“Defendant”) Motion to Stay. (ECF No. 75.) Plaintiff/counter-defendant

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(“Plaintiff”) has opposed (ECF No. 76) and Defendant has replied (ECF No. 82.)

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The Court had sua sponte imposed a temporary stay because of the potential

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impact of the Ninth Circuit Court of Appeals’ decision in Bourne Valley Court Trust v.

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Wells Fargo Bank, NA, 832 F.3d 1154 (9th Cir. 2016), r’hng denied (9th Cir. Nov. 4, 2016).

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(ECF No. 68.) In Bourne Valley, the Ninth Circuit found that Chapter 116’s notice

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provisions as applied to a nonjudicial foreclosure of an HOA lien before the 2015

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amendment was facially unconstitutional. Id. at 1157-60. The Court subsequently lifted

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the stay after the Ninth Circuit issued the mandate in Bourne Valley. (ECF No. 69.) The

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Court reasoned that Bourne Valley’s holding is binding precedent unless and until it is

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reversed, though such finality may not occur for months. (Id.) Within days, the Nevada

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Supreme Court in Saticoy Bay LLC Series 350 Durango 104 v. Wells Fargo Home

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Mortgage, a Division of Wells Fargo Bank, N.A., 388 P.3d 970 (Nev. 2017), reached the

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opposite conclusion, finding that Nevada’s superpriority lien statutes are not facially

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unconstitutional. The nonprevailing parties in Bourne Valley and Satico Bay are seeking

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review of both decisions in the United States Supreme Court. In light of this latest

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development, the Court finds that a stay is warranted and will grant Defendant’s Motion.

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A district court has discretionary power to stay proceedings in its own court. Landis

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v. N. Am. Co., 299 U.S. 248, 254-55 (1936); see also Lockyer v. Mirant Corp., 398 F.3d

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1098, 1109 (9th Cir. 2005). “A trial court may, with propriety, find it is efficient for its own

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docket and the fairest course for the parties to enter a stay of an action before it, pending

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resolution of independent proceedings which bear upon the case.” Leyva v. Certified

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Grocers of Cal., Ltd., 593 F.2d 857, 863 (9th Cir. 1979). “When considering a motion to

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stay, the district court should consider three factors: (1) potential prejudice to the non-

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moving party; (2) hardship and inequity to the moving party if the action is not stayed; and

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(3) the judicial resources that would be saved by avoiding duplicative litigation if the cases

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are in fact consolidated.” Pate v. Depuy Orthopaedics, Inc., No. 2:12-cv-01168-MMD-

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CWH, 2012 WL 3532780, at *2 (D. Nev. Aug. 14, 2012) (quoting Rivers v. Walt Disney

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Co., 980 F. Supp. 1358, 1360 (C.D. Cal. 1997)) (internal quotation marks omitted). See

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also Dependable Highway Exp., Inc. v. Navigators Ins. Co., 498 F.3d 1059, 1067 (9th Cir.

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2007).

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These three factors weigh in favor of a temporary stay in this case, though the

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duration of the stay may be extended depending on whether the Supreme Court will grant

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Bourne Valley and Well Fargo’s petitions for a writ of certiorari. Plaintiff insists that a stay

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will be prejudicial because of the continued damages to Plaintiff caused by Defendant’s

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assertion of title to the property at issue. (ECF No. 76 at 3.) However, any damage to

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Plaintiff from a stay will be outweighed by the fees that all parties will surely incur from

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continued litigation because a decision by the Court could be rendered moot by a decision

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in the certiorari proceedings before the Supreme Court. Until there is finality on the issue
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of whether Nevada’s superpriority lien statutes are constitutional, a stay will benefit the

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parties and conserve judicial resources.

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It is therefore ordered that Defendant’s Motion to Stay (ECF No. 75) is granted.

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This action is temporarily stayed until resolution of the certiorari proceedings before the

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United States Supreme Court in Bourne Valley and/or Saticoy Bay. The parties must file

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a status report within 15 days from such resolution. All pending motions for summary

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judgment (ECF No. 72, 73, 74) are denied without prejudice and may be refiled within

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thirty (30) days after the stay is lifted.

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DATED THIS 5th day of April 2017.

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MIRANDA M. DU
UNITED STATES DISTRICT JUDGE

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