Campanella v. Aurora Loan Servicing

Filing 29

ORDER denying 25 Motion for Reconsideration. Signed by Senior Judge Lawrence E. Kahn on August 25, 2011. (sas)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
CHRISTOPHER CAMPANELLA,
Plaintiff,
-against-

1:10-CV-00684 (LEK/DRH)
1:10-CV-00685 (LEK/DRH)

AURORA LOAN SERVICING,
Defendant.
___________________________________
MEMORANDUM-DECISION and ORDER
I. INTRODUCTION
Presently before the Court are two Motions for reconsideration filed by Plaintiff Christopher
Campanella. Dkt. Nos. 30/25 (“Mot. for Reconsideration”).1 On June 11, 2010, Plaintiff filed two
lawsuits against Defendant Aurora Loan Servicing (“Defendant” or “Aurora”). Compl. (Dkt. Nos.
1/1). The federal claims at issue were brought under the Truth in Lending Act (“TILA”), the Real
Estate Settlement and Procedures Act (“RESPA”), and the Home Owner’s Equity Protection Act
(“HOEPA”). Id. Plaintiff Christopher Campanella (“Plaintiff” or “Campanella”) has also brought
state law claims for unjust enrichment, intentional infliction of emotional distress, breach of
fiduciary duty, fraud, and lack of good faith. Id. On December 20, 2010, the Court issued a
Memorandum-Decision and Order granting Defendant’s Motions to dismiss. Dkt. Nos. 25/22
(“Memo. Decision & Order”). For the reasons that follow, Plaintiff’s Motions for reconsideration
are denied.
1

This Motion was filed concurrently in two separate but nearly identical actions designated
as Civil Case Numbers 1:10-CV-684 (LEK/DRH) and 1:10-CV-685 (LEK/DRH). This order will
cite case numbers in both dockets by using the docket number in the 1:10-CV-684 case, followed by
the docket number in the 1:10-CV-685 case.

II. BACKGROUND
Campanella’s claims arise out of a mortgage transaction between Campanella and Bankers
Mortgage Trust, Inc., which closed on January 19, 2007. Mendoza Decl. (Dkt. Nos. 13-1/12-1) ¶
30. The Mortgage was thereafter assigned to Aurora and the Note was transferred by way of an
allonge and endorsement. See Maccagno Aff. (Dkt. Nos. 13/12, Ex. B). When Campanella
defaulted on his monthly installment payments on June 1, 2008, Aurora commenced a foreclosure
action by the filing of a lis pendens, summons and complaint in state court with the Albany County
Clerk. Mendoza Decl. ¶ 7. Campanella was served on April 16, 2009, and responded by serving an
answer dated May 11, 2009. Id. ¶ 8. A motion for summary judgment and order of reference was
filed, and Campanella then submitted opposition papers to Aurora’s motion and Aurora submitted a
reply. See Maccagno Aff. Subsequently, the New York Supreme Court, Rensselaer County granted
Aurora’s motion for summary judgment and order of reference. Mendoza Decl. ¶ 9. Aurora served
Campanella with a copy of the order with notice of entry, dated April 30, 2010. See Order Granting
Mot. for SJ (Dkt. Nos. 13/12, Ex. C). Campanella later filed a motion for reconsideration, which
was returned to Campanella for failure to pay the filing fee. Mendoza Decl. ¶ 10. The time to
appeal the state court’s order granting summary judgment thereafter expired.
Campanella filed a Complaint in this action on June 11, 2010 with the United States District
Court for the Northern District of New York. Dkt. Nos. 6/6. Aurora subsequently responded to
Campanella’s action by filing Motions to Dismiss. Dkt. Nos. 13/12. In his Complaint, Campanella
sought an emergency restraining order, a permanent injunction enjoining Aurora from engaging in
fraudulent, deceptive, predatory and negligent acts and practices; quiet title, rescission of the loan
contract and restitution, disgorgement of all amounts wrongfully acquired by Aurora, actual
2

monetary damages in the amount of $744,444.11, pain and suffering, pre-judgment and postjudgment interest, punitive damages in an amount equal to $2,233,332.33, and attorney’s fees and
costs. Compl.
The Court denied the request for a temporary restraining order. Dkt. Nos. 7/7. Aurora’s
Memoranda in support of Defendant’s Motion sought dismissal on the grounds of failure to state a
claim upon which relief can be granted, issue and claim preclusion, and expiration of the statute of
limitations. Dkt. Nos. 13-6/12-6. In its Memorandum-Decision and Order granting Defendant’s
Motions to Dismiss, the Court found that the statute of limitations had expired on Plaintiff’s claims,
including his claims under RESPA, TILA, and HOEPA, and that the doctrine of equitable tolling
did not apply. Memo. Decision & Order at 4-5. The Court also found that Plaintiff’s claims were
precluded by the previous state court judgment, noting that he had filed an answer and opposition to
the motion for summary judgment in state court, and had then had an opportunity to assert
additional affirmative defenses and/or counterclaims sounding in fraud, conspiracy to commit fraud,
and violations of TILA, RESPA, and HOEPA. Id. at 5-7. Thus, the Court found that Plaintiff was
barred from asserting different theories of relief or seeking different remedies arising out of the
same transaction or series of transactions. Id.
III. DISCUSSION
A. Standard of Review
The standard for granting a motion for reconsideration is a stringent one, and
“reconsideration will generally be denied unless the moving party can point to controlling decisions
or data that the court overlooked - matters, in other words, that might reasonably be expected to alter
the conclusion reached by the court.” Shrader v. CSX Transp., Inc., 70 F.3d 255, 257 (2d Cir.
3

1995). There are three primary grounds on which the Court may grant a motion for reconsideration:
(1) an intervening change in law, (2) the availability of evidence not previously available, and (3)
the need to correct a clear error or prevent manifest injustice. See Virgin Atlantic Airways, Ltd. v.
Nat’l Mediation Bd., 956 F.2d 1245, 1255 (2d Cir. 1992).
B. Discussion
In his Motions for reconsideration, Plaintiff argues that equitable tolling applies because
Defendant concealed “certain information from Plaintiff in a fraudulent manner, so as to prevent full
disclosure.” Mot. for Reconsideration at 2. Plaintiff further claims that since this Court granted the
Motion to dismiss, there have “been numerous documents, and evidence collected that will
unequivocally prove that . . . the action brought forth in the state court was brought with intent to
defraud Plaintiff.” Id. at 5. However, Plaintiff again fails to demonstrate that Defendant undertook
any measures to conceal the existence of any potential claim or cause of action, or brought the state
court action with an intent to defraud. Thus, beyond baldly asserting that fraud took place in a
conclusory manner, Plaintiff has not set forth any facts that would permit equitable tolling.
Plaintiff cites his pro se status in an effort to cure the failings in his pleadings. Id. at 2. It is
true that, because Plaintiff is a pro se litigant, the Court must endeavor to interpret his opinions “to
raise the strongest arguments they suggest.” Burgos v. Hopkins, 14 F.3d 787, 790 (2d Cir. 1994).
However, Plaintiff’s “pro se status does not exempt a party from compliance with relevant rules of
procedural and substantive law.” Triestman v. Fed. Bureau of Prisons, 470 F.3d 471, 477 (2d Cir.
2006). Plaintiff must still allege facts that, if true, are sufficient to state a claim to relief that is
plausible on its face, and the Court finds that he has failed to do so. Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007).
4

Plaintiff also argues that claim preclusion should not apply because his efforts to obtain
discovery of Defendant’s fraud were frustrated when the state court granted Defendant’s Motion for
summary judgment. Mot. for Reconsideration at 5. However, it is well-established that a
“judgment on the merits for purposes of res judicata is not necessarily a judgment based upon a trial
of contested facts; it may, for example, be a default judgment . . . or a summary judgment.” Dillard
v. Henderson, 43 F. Supp. 2d 367, 369 (S.D.N.Y. 1999). An “adjudication on the merits” has “a
well settled meaning: a decision finally resolving the parties’ claims, with res judicata effect, that is
based on the substance of the claim advanced, rather than on a procedural, or other, ground.” Sellan
v. Kuhlman, 261 F.3d 303, 311 (2d Cir. 2001) (citations omitted).
In the present case, the state court considered the substance of Plaintiff’s arguments in
opposition to foreclosure, including lack of personal jurisdiction, criminal trespass, lack of standing,
dispute of the amount due, a copy of the mortgage not being attached to the complaint, a request to
inspect the note and mortgage and question a representative of Aurora, and his allegation that no
competent fact witness executed the complaint. Order Granting Mot. for SJ. The state court
rejected these arguments and issued a judgment and order of reference against Campanella in the
mortgage foreclosure action. Id. The Court finds that this decision was based on the substance of
the claim, rather than on a procedural or other ground, and therefore concludes that it was an
adjudication on the merits that is entitled to preclusive effect. Furthermore, to the extent Plaintiff
did not plead violations of federal statutes in the state court foreclosure actions, the Court notes that
he had the ability to do so. As the current claims stem from the same underlying transaction that
was litigated in the state court foreclosure actions, Plaintiff is barred by issue preclusion. Compare
Compl. with Order Granting Mot. for SJ; Nat’l Labor Relations Bd. v. United Technologies Corp.,
5

706 F.2d 1254, 1260 (2d Cir. 1983).
Finally, Plaintiff alleges that he is being deprived of his property without due process. Mot.
for Reconsideration at 6. The Court notes, however, that Plaintiff has actively participated in both
underlying foreclosure actions and filed these actions in federal court. See generally, Maccagno
Aff., Compl. The Due Process Clause requires only that “the parties were given notice and an
opportunity to be heard [in state court] with respect to the claims against them.” Conopco, Inc. v.
Roll Int’l, 231 F.3d 82, 88 (2d Cir. 2000). Plaintiff has had the opportunity to be heard in both the
state and federal court, and the Court therefore rejects Plaintiff’s arguments regarding due process.
IV. CONCLUSION
Accordingly, it is hereby:
ORDERED, that Plaintiff’s Motions for reconsideration (Dkt. Nos. 30/25) are DENIED;
and it is further
ORDERED, that the Clerk serve a copy of this Order on the parties.
IT IS SO ORDERED.

DATED:

August 25, 2011
Albany, New York

6