Nath v. JP Morgan Chase Bank, N.A. et al

Filing 68

OPINION & ORDER re: 20 MOTION to Dismiss , filed by JP Morgan Chase Bank, N.A., Select Portfolio Servicing, Inc., U.S. Bank, N.A. as Indenture Trustee for C.S. F.B. Trust 2002-NP14, 43 MOTION to Dismiss all claims against the IRS, filed by The Internal Revenue Service. The Court grants Private Defendants' Motion in its entirety, and Plaintiff's claims against the Private Defendants are dismissed with prejudice. The IRS's Motion is granted. Plai ntiff's claims against the IRS are dismissed with prejudice, except for his claim challenging the procedural validity of the tax liens issued against the Subject Property. With respect to that claim, and that claim only, Plaintiff may file an Amended Complaint, which must be filed with this Court within 30 days. Failure to do so may result in dismissal of his remaining claim against the IRS with prejudice. The Clerk of Court is respectfully requested to terminate the pending Motions. (D kt. Nos. 20, 43.) SO ORDERED., (U.S. Bank, N.A. as Indenture Trustee for C.S. F.B. Trust 2002-NP14 (Successor in Interest to Bank of America as Indenture Trustee for C.S.F.B. Trust 2002-NP-14", Sucessor in Interest to Lasalle Bank N.A., As Indenture Trustee for C.S.F.B. Trust 2002-NP 14), JP Morgan Chase Bank, N.A. and Select Portfolio Servicing, Inc. terminated.) (Signed by Judge Kenneth M. Karas on 9/30/16) (yv)

UNITED STATES DISTRICT COURT
OUTHERN DISTRICT OF NEW YORK

PREM NATH,
Plaintiff,
v.

No. 15-CV-3937 (KMK)

JP MORGAN CHASE BANK, N.A.;
SELECT PORTFOLIO SERVICING, INC.;
U.S. BANK N.A., as Indenture Trustee for
C.S.F.B. Trust 2002-NP14; and THE
INTERNAL REVENUE SERVICE,

OPINION & ORDER

Defendants.

Appearances:
Prem Nath
Blauvelt, NY
Pro Se Plaintiff
Casey B. Howard, Esq.
Samantha A. Ingram, Esq.
Locke Lord LLP
New York, NY
Counsel for Defendants JP Morgan Chase Bank, N.A.,
Select Portfolio Servicing, Inc., and U.S. Bank, N.A.
Anthony Jan-Huan Sun, Esq.
U.S. Attorney’s Office S.D.N.Y.
New York, NY
Counsel for Defendant Internal Revenue Service
KENNETH M. KARAS, District Judge:
Plaintiff Prem Nath (“Nath” or “Plaintiff”) brings this Action against JP Morgan Chase
Bank, N.A. (“JPMorgan”), Select Portfolio Servicing, Inc. (“SPS”), U.S. Bank, N.A., as
indenture trustee for C.S.F.B. Trust 2002-NP14 (“U.S. Bank,” and collectively with JPMorgan
and SPS, the “Private Defendants”), and the Internal Revenue Service (the “IRS”), seeking to

quiet title to certain real property and to cancel or invalidate various assignments and agreements
related to a mortgage encumbering the property. (See Compl. (Dkt. No. 1).) Before the Court
are two Motions To Dismiss, one filed by the Private Defendants (see Dkt. No. 20), and one filed
by the IRS (see Dkt. No. 43). For the following reasons, both Motions are granted.
I. Factual and Procedural Background
The following facts are drawn from the Complaint, as well as the various transaction
documents and state court documents attached to Private Defendants’ moving papers.1

1

“In ruling on a 12(b)(6) motion, . . . a court may consider the complaint[,] . . . any
written instrument attached to the complaint as an exhibit[,] or any statements or documents
incorporated in it by reference,” as well as “matters of which judicial notice may be taken, and
documents either in [the] plaintiffs’ possession or of which [the] plaintiffs had knowledge and
relied on in bringing suit.” Kalyanaram v. Am. Ass’n of Univ. Professors at N.Y. Inst. of Tech.,
Inc., 742 F.3d 42, 44 n.1 (2d Cir. 2014) (brackets and internal quotation marks omitted); see also
Leonard F. v. Isr. Disc. Bank of N.Y., 199 F.3d 99, 107 (2d Cir. 1999) (“In adjudicating a Rule
12(b)(6) motion, a district court must confine its consideration to facts stated on the face of the
complaint, in documents appended to the complaint or incorporated in the complaint by
reference, and to matters of which judicial notice may be taken.” (internal quotation marks
omitted)); Hendrix v. City of N.Y., No. 12-CV-5011, 2013 WL 6835168, at *2 (E.D.N.Y. Dec.
20, 2013) (same).
Following these principles, the Court considers the underlying Note, Mortgage, and
assignment of the Mortgage, which are clearly referenced in, and integral to, the Complaint. See
Best v. Bank of Am., N.A., No. 14-CV-6546, 2015 WL 5124463, at *1 (E.D.N.Y. Sept. 1, 2015)
(“Along with its papers, [the defendant] submitted an affidavit attaching the mortgage, note,
assignment of mortgage, and other loan documents issued by [the defendant] to [the
plaintiff] . . . , [which the court can] consider . . . because the documents are specifically
referenced in, and are integral to, the complaint.”); Solomon v. Ocwen Loan Servicing, LLC, No.
12-CV-2856, 2013 WL 1715878, at *4 (E.D.N.Y. Apr. 12, 2013) (“The [n]ote and [m]ortgage
are integral to the amended complaint and therefore may be considered by the [c]ourt.”). The
Court also considers various state court documents filed in the underlying state foreclosure
proceeding. See Yencho v. Chase Home Fin. LLC, No. 14-CV-230, 2015 WL 127721, at *4
(S.D.N.Y. Jan. 8, 2015) (considering filings in state court foreclosure proceeding); Solomon,
2013 WL 1715878, at *4 (“The [c]ourt may . . . take judicial notice of the state-court foreclosure
proceedings.”); see also Ferrari v. Cty. of Suffolk, 790 F. Supp. 2d 34, 38 n.4 (E.D.N.Y. 2011)
(“In the Rule 12(b)(6) context, a court may take judicial notice of prior pleadings, orders,
judgments, and other related documents that appear in the court records of prior litigation and
that relate to the case sub judice.” (italics omitted)).
Moreover, “[i]n resolving a motion to dismiss for lack of subject matter jurisdiction under
Rule 12(b)(1)[,] a district court may consider evidence outside the pleadings.” Morrison v. Nat’l

2

On September 4, 1998, Nath executed a note (the “Note”) and mortgage (the
“Mortgage”) with Long Beach Mortgage Company (“LBMC”) to secure a loan (the “Loan”) for
purchase of the real property located at 12 John Calvin Street, Blauvelt, New York (the “Subject
Property”). (See Atty. Decl. of Casey B. Howard in Supp. of Defs.’ Mot. To Dismiss (“Howard
Decl.”) Ex. 12 at ¶¶ 4–5 (Dkt. No. 22); see also Compl. ¶ 14.)
On or around June 19, 2001, a foreclosure action was brought in New York Supreme
Court, Rockland County, captioned The Chase Manhattan Bank v. Prem Nath, et al., Index No.
3532/2001 (the “Foreclosure Action” brought in the “State Court”). (See Compl. ¶ 15; see also
Dkt. No. 1-2 at 7 (“Foreclosure Complaint”).)
On October 16, 2005, Plaintiff filed a bankruptcy petition under Chapter 7 in the United
States Bankruptcy Court for the Southern District of New York (the “First Bankruptcy”). (See
Compl. ¶ 17; see also Dkt. No. 1 (05-BK-25603 Dkt.).) Plaintiff received a discharge on March
17, 2006, (see Dkt. No. 12 (05-BK-25603 Dkt.)), and shortly thereafter the Bankruptcy Court
entered an order lifting the automatic stay to allow foreclosure to proceed on the Subject
Property, (see Dkt. No. 20 (05-BK-25603 Dkt.)).2
On March 18, 2010, Nath executed a Settlement Agreement and Release (the “Settlement
Agreement”) with LaSalle Bank (“LaSalle”) as Trustee for the CSFB Trust 2002-NP14. (See

Austl. Bank Ltd., 547 F.3d 167, 170 (2d Cir. 2008), aff’d, 561 U.S. 247 (2010); see also Kamen
v. Am. Tel. & Tel. Co., 791 F.2d 1006, 1011 (2d Cir. 1986) (“[W]hen, as here, subject matter
jurisdiction is challenged under Rule 12(b)(1), evidentiary matter may be presented by affidavit
or otherwise.”).

2
Nath alleges that “SPS committed fraud upon [the] bankruptcy court during [the First
Bankruptcy when] John Cody[,] officer of SPS[,] stated to th[e] bankruptcy court that [Nath’s]
mortgage was owned by [LBMC] in 2006.” (Compl. ¶ 17.)

3

Howard Decl. Ex. 2 (“Settlement Agreement”); see also Compl. ¶ 18.)3 The Settlement
Agreement states that Chase Manhattan Bank (“Chase”) “assigned all right, title and interest in
the subject Note and Mortgage” to LaSalle, as trustee. (Settlement Agreement at unnumbered 1.)
The Settlement Agreement also contained a loan modification agreement (the “Loan
Modification Agreement”), and stated that, in the event Nath failed to make the first three timely
payments, he agreed, among other things, “to waive any and all defenses” to the Foreclosure
Action. (Settlement Agreement ¶ 6.)4 Nath concedes that he did not make any payments under
the Loan Modification Agreement. (Compl. ¶ 21.)
On December 9, 2010, the State Court issued a Decision and Order granting summary
judgment against Nath in the Foreclosure Action. (Howard Decl. Ex. 4 (“State Court Dec. 2010
Decision”).) The State Court found that Chase “ha[d] established prima facie entitlement to a
judgment of foreclosure and sale and [Nath] ha[d] failed to raise a material issue of fact.” (Id. at
5.)5 In the same decision, the State Court rejected Plaintiff’s request to rescind the Loan

3

Nath alleges that LaSalle “did not give any [Truth in Lending Act] [r]escission notice to
[him].” (Compl. ¶ 18.) He further alleges that he “sought to have [the Loan Modification
Agreement] rescinded and invalidated” pursuant to his rights under the Act. (Id. ¶ 21.)

4
The Loan Modification Agreement states that, as of March 1, 2010, the unpaid principal
balance Nath owed under the Note was $492,260.67. (Settlement Agreement at unnumbered 6.)
It further states that Nath promised to pay the unpaid principal balance to the order of LaSalle.
(Id.) As Nath’s Complaint points out, the Loan Modification Agreement lists the incorrect date
for the underlying Mortgage. (Id. (listing September 4, 2008, not 1998, as the date of the
Mortgage); see also Compl. ¶ 19.)

5
The State Court observed that Chase offered “an affidavit of Gina Tolman, a member of
its servicing agent,” (“Tolman Affidavit”) in support of its motion for summary judgment. (State
Court Dec. 2010 Decision 4.) The State Court further noted that “[Nath] does not refute the
contents of the Tolman [A]ffidavit.” (Id.) Plaintiff’s Complaint challenges the accuracy of the
Tolman Affidavit. (See, e.g., Compl. ¶ 23(B) (referring to the Tolman Affidavit as a “false
affidavit[]”).)

4

Modification Agreement on the grounds of mutual mistake. (Id. at 2–3.)6 The decision led to a
Judgment of Foreclosure and Sale (“State Court Foreclosure Judgment”), dated February 4,
2011, and entered on March 2, 2011, directing that the Subject Property be sold at public auction
and that the proceeds of the sale be deposited with Chase. (Howard Decl. Ex. 1 (“State Court
Foreclosure Judgment”).)
On or around February 8, 2011, after the State Court Foreclosure Judgment was signed,
but before it was entered, Nath, represented by counsel, filed an order to show cause (the “Order
to Show Cause”) seeking, among other things, leave to renew Chase’s motion for summary
judgment and vacatur of both (1) the State Court’s December 9, 2010 Decision and (2) the
Settlement Agreement and Loan Modification Agreement. (Howard Decl. Ex. 5 (“Order to
Show Cause”).) The following arguments were raised: (1) the Tolman Affidavit lacked a
“certificate of conformity,” (2) the Tolman Affidavit stated that Chase was the holder of the Note
and Mortgage but the Settlement Agreement and Loan Modification Agreement stated that the
Loan was assigned to LaSalle, (3) Chase was a non-existent entity when it commenced the
foreclosure proceedings in June 2001, thus it lacked the capacity to commence the proceedings,
to accept the assignment of the Note and Mortgage in July 2001, or to assign it to LaSalle in June
2010, (4) Chase’s initial complaint filed in June 2001 contained the material misrepresentation
that Chase had been assigned the Loan prior to commencement of the action, when, in fact, the
purported assignment from LBMC to Chase was dated July 19, 2001, (5) the July 19, 2001
assignment (“2001 Assignment”) from LMBC to Chase was invalid because it lacked a

6

According to the State Court, the monthly payment of principal and interest and balloon
payment amounts in the Loan Modification Agreement were erroneous, but Chase was willing to
accept the mistake in drafting, which would result in its receipt of less than it bargained for under
the Loan Modification Agreement. (State Court Dec. 2010 Decision 2.)

5

certificate of conformity, lacked a power of attorney, and was signed by an agent of the assignee,
rather than by the assignor, and (6) LaSalle is a non-existent entity, because it merged into
another corporation as of October 17, 2008, and thus it lacked the capacity to accept assignment
of the Loan from Chase and to enter into the Settlement Agreement and Loan Modification
Agreement in March 2010. (Order to Show Cause Aff’n in Supp. ¶ 9.)
The State Court issued a Decision and Order dated July 20, 2011 that denied Nath’s
Order to Show Cause. (Howard Decl. Ex. 7 (“Vacatur Denial”).) The State Court determined
that Nath “ha[d] failed to offer a valid excuse for failing to submit the additional facts [relied
upon in his Order to Show Cause] with the original application.” (Id. at 3.) Because “[a]ll of
[Nath’s] ‘newly’ discovered facts were available at the time of the prior motion and appear to
have been discoverable with appropriate diligence,” Nath’s motion to renew was denied. (Id.)
On August 30, 2011, Plaintiff filed a bankruptcy petition under Chapter 13 in the United
States Bankruptcy Court for the Southern District of New York (the “Second Bankruptcy”). (See
Dkt. No. 1 (11-BK-23730 Dkt.).) By that time, U.S. Bank had taken over as Trustee for the
CSFB Trust 2002-NP14, (see Howard Decl. Ex. 12 at ¶ 12), and filed a proof of claim with the
Bankruptcy Court on October 24, 2011, in the amount of $1,211,193.90, including an unpaid
principal balance of $492,260.67, for the secured debt on the Subject Property, (see Dkt. No. 172 (11-BK-23730 Dkt.)). Plaintiff, through counsel, objected to U.S. Bank’s proof of claim.
(Dkt. No. 17 (11-BK-23730 Dkt.).) On March 21, 2014, the Bankruptcy Court granted U.S.
Bank’s motion for summary judgment on two independent grounds. First, because U.S. Bank
was the holder of the Note with a valid endorsement in blank, it had standing to file and pursue
the proof of claim. (See Dkt. No. 98 at 92, 98 (11-BK-23730 Dkt.).) Second, the Bankruptcy
Court held that the Rooker-Feldman doctrine barred it from granting Nath’s claim objection,

6

because such a ruling would “serve as a de facto reversal of the Rockland County Orders” that
recognized and enforced U.S. Bank Trustee’s rights under the Settlement Agreement signed by
Nath. (Id. at 96 (italics omitted).) In an order dated April 14, 2014, the Bankruptcy Court
granted the Chapter 13 Trustee’s motion to dismiss the case for failure to comply with certain
provisions of the Bankruptcy Code. (See Dkt. No. 93 (11-BK-23730 Dkt.).)7
On June 11, 2014, Plaintiff filed an order to show cause in this Court seeking an
emergency stay of the sale of the Subject Property, (see Dkt. Nos. 5–6 (14-CV-3871 Dkt.)),
which this Court denied in a bench ruling at oral argument held on June 27, 2014, (see Dkt. No.
14 (14-CV-3871 Dkt.)). This Court eventually affirmed the Bankruptcy Court’s decision
granting U.S. Bank’s motion for summary judgment on its proof of claim in a bench ruling on
September 25, 2015. (Dkt. No. 25 (14-CV-3871 Dkt.).)8
On May 21, 2015, Plaintiff filed a Complaint against Defendants “to [q]uiet [t]itle on the
[Subject] [P]roperty, to expunge any title claimed by Defendants with respect to said property, to
remove the cloud on the title held by Plaintiff, and to nullify a loan modification agreement
secured by the property.” (Compl. 1–2.) Private Defendants filed a Motion To Dismiss on
September 16, 2015, (see Dkt. Nos. 20–22), which Plaintiff opposes, (see Dkt. No. 23; see also

7

Specifically, the Bankruptcy Court found that Nath failed to comply with 11 U.S.C.
§ 1307(c)(1), having created unreasonable delay that is prejudicial to creditors, and 11 U.S.C.
§ 109(e), as Nath had too much debt to be an eligible debtor under chapter 13. (See Dkt. No. 93
(11-BK-23730 Dkt.).)
8

Plaintiff has since filed two additional bankruptcy petitions, one under Chapter 7, (see
Dkt. No. 1 (14-BK-23714 Dkt.)), and one under Chapter 13, (see Dkt. No. 1 (15-BK-23531
Dkt.)). Appeals from decisions of the bankruptcy court in both of those cases are pending before
this Court and will be the subjects of separate Opinions.

7

Dkt. No. 53). Private Defendants replied on October 2, 2015. (See Dkt. Nos. 25–26.)9 The IRS
filed a Motion To Dismiss on December 18, 2015, (see Dkt. Nos. 43–46), which Plaintiff
opposes, (see Dkt. No. 52). The IRS filed its reply brief on February 26, 2016. (See Dkt. No.
54.)10
II. Discussion
A. Standard of Review
“The standards of review for a motion to dismiss under Rule 12(b)(1) for lack of subject
matter jurisdiction and under 12(b)(6) for failure to state a claim are ‘substantively identical.’”
Gonzalez v. Option One Mortg. Corp., No. 12-CV-1470, 2014 WL 2475893, at *2 (D. Conn.
June 3, 2014) (quoting Lerner v. Fleet Bank, N.A., 318 F.3d 113, 128 (2d Cir. 2003)); see also
Neroni v. Coccoma, No. 13-CV-1340, 2014 WL 2532482, at *4 (N.D.N.Y. June 5, 2014) (same),
aff’d, 591 F. App’x 28 (2d Cir. 2015). “In deciding both types of motions, the Court must accept
all factual allegations in the complaint as true, and draw inferences from those allegations in the
light most favorable to the plaintiff.” Gonzalez, 2014 WL 2475893, at *2 (internal quotation
marks omitted); see also Seemann v. U.S. Postal Serv., No. 11-CV-206, 2012 WL 1999847, at *1
(D. Vt. June 4, 2012) (same). However, “[o]n a Rule 12(b)(1) motion, . . . the party who invokes
the Court’s jurisdiction bears the burden of proof to demonstrate that subject matter jurisdiction
exists, whereas the movant bears the burden of proof on a motion to dismiss under Rule
12(b)(6).” Gonzalez, 2014 WL 2475893, at *2; see also Sobel v. Prudenti, 25 F. Supp. 3d 340,
9

Nath also filed a motion seeking a ruling that the Court’s order extending Private
Defendants’ time to answer was “obtained by fraud” and thus “null [and] void,” (see Dkt. No.
24), which Private Defendants opposed, (see Dkt. Nos. 27–28). The Court denied the motion by
memo endorsement on January 21, 2016. (See Dkt. No. 51.)
10

The Court notes that Plaintiff has filed a number of other documents in this Action,
some of which the Court addresses below. (See Dkt. Nos. 39, 40, 53, 61, 66, 67.) Private
Defendants responded to some of the filings. (See Dkt. No. 56.)

8

352 (E.D.N.Y. 2014) (“In contrast to the standard for a motion to dismiss for failure to state a
claim under Rule 12(b)(6), a plaintiff asserting subject matter jurisdiction has the burden of
proving by a preponderance of the evidence that it exists.” (internal quotation marks omitted)).
This allocation of the burden of proof is “[t]he only substantive difference” between the
standards of review under these two rules. Smith v. St. Luke’s Roosevelt Hosp., No. 08-CV4710, 2009 WL 2447754, at *9 n.10 (S.D.N.Y. Aug. 11, 2009), adopted by 2009 WL 2878093
(S.D.N.Y. Sept. 2, 2009); see also Fagan v. U.S. Dist. Court for S. Dist. of N.Y., 644 F. Supp. 2d
441, 446–47 & n.7 (S.D.N.Y. 2009) (same).
1. Rule 12(b)(1)
“A federal court has subject matter jurisdiction over a cause of action only when it has
authority to adjudicate the cause pressed in the complaint.” Bryant v. Steele, 25 F. Supp. 3d 233,
241 (E.D.N.Y. 2014) (internal quotation marks omitted). “Determining the existence of subject
matter jurisdiction is a threshold inquiry[,] and a claim is properly dismissed for lack of subject
matter jurisdiction under Rule 12(b)(1) when the district court lacks the statutory or
constitutional power to adjudicate it.” Morrison v. Nat’l Austl. Bank Ltd., 547 F.3d 167, 170 (2d
Cir. 2008) (internal quotation marks omitted), aff’d, 561 U.S. 247 (2010). While a district court
resolving a motion to dismiss under Rule 12(b)(1) “must take all uncontroverted facts in the
complaint . . . as true, and draw all reasonable inferences in favor of the party asserting
jurisdiction,” “where jurisdictional facts are placed in dispute, the court has the power and
obligation to decide issues of fact by reference to evidence outside the pleadings, such as
affidavits,” in which case “the party asserting subject matter jurisdiction has the burden of
proving by a preponderance of the evidence that it exists.” Tandon v. Captain’s Cove Marina of
Bridgeport, Inc., 752 F.3d 239, 243 (2d Cir. 2014) (alteration and internal quotation marks

9

omitted); see also Ray Legal Consulting Grp. v. Gray, 37 F. Supp. 3d 689, 696 (S.D.N.Y. 2014)
(“[W]here subject matter jurisdiction is contested a district court is permitted to consider
evidence outside the pleadings, such as affidavits and exhibits.”).
2. Rule 12(b)(6)
“While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed
factual allegations, a plaintiff’s obligation to provide the grounds of his [or her] entitlement to
relief requires more than labels and conclusions, and a formulaic recitation of the elements of a
cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citation,
alteration, and internal quotation marks omitted). Indeed, Rule 8 of the Federal Rules of Civil
Procedure “demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks omitted). “Nor does a
complaint suffice if it tenders naked assertions devoid of further factual enhancement.” Id.
(alteration and internal quotation marks omitted). Instead, a complaint’s “[f]actual allegations
must be enough to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555.
Although “once a claim has been stated adequately, it may be supported by showing any set of
facts consistent with the allegations in the complaint,” id. at 563, and a plaintiff must allege
“only enough facts to state a claim to relief that is plausible on its face,” id. at 570, if a plaintiff
has not “nudged [his or her] claim[] across the line from conceivable to plausible, the[]
complaint must be dismissed,” id.; see also Iqbal, 556 U.S. at 679 (“Determining whether a
complaint states a plausible claim for relief will . . . be a context-specific task that requires the
reviewing court to draw on its judicial experience and common sense. But where the wellpleaded 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.’” (citation

10

omitted) (second alteration in original) (quoting Fed. R. Civ. P. 8(a)(2))); id. at 678–79 (“Rule 8
marks a notable and generous departure from the hyper-technical, code-pleading regime of a
prior era, but it does not unlock the doors of discovery for a plaintiff armed with nothing more
than conclusions.”).
“[W]hen ruling on a defendant’s motion to dismiss, a judge must accept as true all of the
factual allegations contained in the complaint.” Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per
curiam); see also Nielsen v. Rabin, 746 F.3d 58, 62 (2d Cir. 2014) (“In addressing the sufficiency
of a complaint we accept as true all factual allegations . . . .” (internal quotation marks omitted));
Aegis Ins. Servs., Inc. v. 7 World Trade Co., 737 F.3d 166, 176 (2d Cir. 2013) (“In reviewing a
dismissal pursuant to Rule 12(b)(6), we . . . accept all factual allegations in the complaint as
true . . . .” (alteration and internal quotation marks omitted)). Further, “[f]or the purpose of
resolving [a] motion to dismiss, the Court . . . draw[s] all reasonable inferences in favor of the
plaintiff.” Daniel v. T & M Prot. Res., Inc., 992 F. Supp. 2d 302, 304 n.1 (S.D.N.Y. 2014)
(citing Koch v. Christie’s Int’l PLC, 699 F.3d 141, 145 (2d Cir. 2012)).
Where, as here, a plaintiff proceeds pro se, the court must “construe[] [his complaint]
liberally and interpret[] [it] to raise the strongest arguments that [it] suggest[s].” Sykes v. Bank of
Am., 723 F.3d 399, 403 (2d Cir. 2013) (per curiam) (internal quotation marks omitted).
However, “the liberal treatment afforded to pro se litigants does not exempt a pro se party from
compliance with relevant rules of procedural and substantive law.” Bell v. Jendell, 980 F. Supp.
2d 555, 559 (S.D.N.Y. 2013) (internal quotation marks omitted); see also Caidor v. Onondaga
Cty., 517 F.3d 601, 605 (2d Cir. 2008) (“[P]ro se litigants generally are required to inform
themselves regarding procedural rules and to comply with them.” (italics and internal quotation
marks omitted)).

11

B. Analysis
1. Counts One through Six
Plaintiff asserts six causes of action against the Private Defendants, all related to his
interest (or lack thereof) in the Subject Property. As described by Plaintiff, the six causes of
action are: (1) “Qu[iet] Title under NY RPAPL;” (2) “Qu[iet] Title Under Common Law;” (3)
“Cancellation of 2001 Assignment as of Record under NY RPL 329;” (4) “Cancellation of the
Loan Modification as of Record under RPL 329;” (5) “Declaratory Judgment,” declaring that
various assignments and the Loan Modification Agreement are null and void; and (6)
“Rescission of the Loan Modification Agreement under [the Truth in Lending Act (“TILA”)].”
(See Compl. ¶¶ 44–79.) Underlying these causes of action are many allegations that are in large
part identical to the fraud allegations scattered throughout Plaintiff’s filings in the several other
actions to which he has been a party in federal court.
Private Defendants seek dismissal on the grounds that Plaintiff’s claims are barred by the
Rooker-Feldman doctrine, res judicata, and collateral estoppel. (See generally Mem. of Law in
Supp. of Defs.’ Mot. To Dismiss (Dkt. No. 21).) The Court considers the arguments in turn.
a. Rooker-Feldman
“Under the Rooker-Feldman doctrine, federal district courts lack jurisdiction over suits
that are, in substance, appeals from state-court judgments.” Phillips ex rel. Green v. City of N.Y.,
453 F. Supp. 2d 690, 712 (S.D.N.Y. 2006) (internal quotation marks omitted). In Exxon Mobil
Corp. v. Saudi Basic Industries Corp., 544 U.S. 280 (2005), the Supreme Court emphasized that
the doctrine is “narrow” and only applies to federal lawsuits brought by “state-court losers
complaining of injuries caused by state-court judgments rendered before the district court
proceedings commenced and inviting district court review and rejection of those judgments.” Id.

12

at 284. After Exxon Mobil, the Second Circuit reexamined Rooker-Feldman and laid out four
conditions that, if met, require the Court to dismiss a plaintiff’s claims for lack of subject matter
jurisdiction: (1) “the federal-court plaintiff must have lost in state court”; (2) “the plaintiff must
complain of injuries caused by a state-court judgment”; (3) “the plaintiff must invite district
court review and rejection of that judgment”; and (4) “the state-court judgment must have been
rendered before the district court proceedings commenced.” Hoblock v. Albany Cty. Bd. of
Elections, 422 F.3d 77, 85 (2d Cir. 2005) (alterations and internal quotation marks omitted); see
also Vossbrinck v. Accredited Home Lenders, Inc., 773 F.3d 423, 426 (2d Cir. 2014) (same).
“The Second Circuit has classified the first and fourth requirements as ‘procedural’ and the
second and third as ‘substantive.’” Done v. Wells Fargo, N.A., No. 12-CV-4296, 2013 WL
3785627, at *6 (E.D.N.Y. July 18, 2013) (citing Hoblock, 422 F.3d at 85).
There is no question that the procedural requirements are met here. The State Court
Foreclosure Judgment and the July 20, 2011 Decision and Order denying Nath’s Order to Show
Cause were issued against Nath—making him a state-court loser—and in 2011, several years
before the instant Complaint was filed.
Therefore, if Plaintiff’s Complaint merely “complain[s] of injuries” caused by the statecourt foreclosure judgment and seeks this Court’s “review and rejection of” that judgment, then
Plaintiffs’ claims satisfy the substantive requirements of Rooker-Feldman and this Court lacks
subject matter jurisdiction over them. Hoblock, 422 F.3d at 85 (internal quotation marks
omitted); see also Scott v. Capital One, Nat’l Assocs., No. 12-CV-183, 2013 WL 1655992, at *3
(S.D.N.Y. Apr. 17, 2013) (same). The Second Circuit has explained that the requirement that a
plaintiff’s injuries be caused by the state judgment is the “core requirement” of the RookerFeldman doctrine. Hoblock, 422 F.3d at 87. Accordingly, Rooker-Feldman would not prevent

13

Plaintiff from “raising federal claims based on the same facts as a prior state case . . . so long as
. . . [P]laintiff complains of an injury independent of an adverse state court decision.” Scott,
2013 WL 1655992, at *3; see also McKithen v. Brown, 481 F.3d 89, 97–98 (2d Cir. 2007)
(“What Exxon Mobil and Hoblock do make clear is that the applicability of the Rooker-Feldman
doctrine turns not on the similarity between a party’s state-court and federal-court claims . . . ,
but rather on the causal relationship between the state-court judgment and the injury of which
the party complains in federal court.”). Such an “independent claim” is not barred by RookerFeldman, even if the claim “denies a legal conclusion that a state court has reached in a case to
which [the plaintiff] was a party.” Exxon, 544 U.S. at 293 (internal quotation marks omitted);
see also Hoblock, 422 F.3d at 86 (“‘[I]ndependent claims’ . . . are outside Rooker-Feldman’s
compass even if they involve the identical subject matter and parties as previous state-court
suits.”).11
This is not the first time that a mortgagor has filed a suit in federal court after a state
court issued an adverse foreclosure judgment. Faced with similar suits, “[c]ourts in this Circuit
have consistently held that any attack on a judgment of foreclosure is clearly barred by the
Rooker-Feldman doctrine.” Webster v. Wells Fargo Bank, N.A., No. 08-CV-10145, 2009 WL
5178654, at *5 (S.D.N.Y. Dec. 23, 2009) (internal quotation marks omitted), aff’d sub nom.
Webster v. Penzetta, 458 F. App’x 23 (2d Cir. 2012); see also, e.g., Barbato v. U.S. Bank Nat’l
Ass’n, No. 14-CV-2233, 2016 WL 158588, at *3 (S.D.N.Y. Jan. 12, 2016) (same); Campbell v.
Bank of N.Y. Trust Co., N.A., No. 11-CV-1588, 2012 WL 2952852, at *7 (S.D.N.Y. May 8,
2012) (same), adopted by 2012 WL 2953967 (S.D.N.Y. July 18, 2012); Murphy v. Riso, No. 11CV-873, 2012 WL 94551, at *6 (E.D.N.Y. Jan. 12, 2012) (same). As the Second Circuit has put
11

“The subsequent federal suit [also] could, of course, be barred by ordinary preclusion
principles.” Hoblock, 422 F.3d at 88 n.6.

14

it, Rooker-Feldman precludes a district court from entertaining a suit that “would require the
federal court to review the state proceedings and determine that the foreclosure judgment was
issued in error.” Vossbrinck, 773 F.3d at 427. This is true even if, as here, a plaintiff contends
that “the foreclosure judgment was obtained fraudulently.” Id.; see also Gonzalez v. Ocwen
Home Loan Servicing, 74 F. Supp. 3d 504, 517 (D. Conn. 2015) (“[E]ven if the state court
judgment as wrongly procured, it is effective and conclusive until it is modified or reversed in
the appropriate State appellate or collateral proceeding.” (internal quotation marks omitted)),
aff’d sub nom. Gonzalez v. Deutsche Bank Nat’l Tr. Co., 632 F. App’x 32 (2d Cir. 2016).
However, “to the extent [Nath’s] pro se complaint can be liberally construed as asserting fraud
claims . . . seek[ing] damages . . . for injuries [Nath] suffered from [Private Defendants’] alleged
fraud, the adjudication of which does not require the federal court to sit in review of the state
court judgment,” such claims “are not barred by Rooker-Feldman.” Vossbrinck, 773 F.3d at
427–28 (italics omitted); see also Gonzalez, 632 F. App’x at 34 (“To the extent [the] plaintiffs’
complaint can be liberally construed to allege injury stemming from the same transaction but not
directly caused by the foreclosure judgment, their claims are not barred by Rooker-Feldman.”
(emphasis omitted)).
The Court finds that Counts One through Six “ask [a] federal court to determine whether
the state judgment was wrongfully issued in favor of parties who, contrary to their
representations to the [State] [C]ourt, lacked standing to foreclose.” Vossbrinck, 773 F.3d at
427. The injuries for which he seeks a remedy flow directly from the state court judgment.
First, Plaintiff’s quiet title causes of action (Counts One and Two) undeniably complain
of, and seek to have remedied, the State Foreclosure Judgment. Indeed, “[t]his is evident from
the relief [Plaintiff] requests—title to . . . his property.” Id.; see Riley v. Comm’r of Fin., 618 F.

15

App’x 16, 17 (2d Cir. 2015) (“[A]n action seeking a declaration of property ownership after loss
of title pursuant to a state-court foreclosure judgment [is] barred by Rooker-Feldman.”);
Barbato, 2016 WL 158588, at *3 (finding Rooker-Feldman barred claims where “the relief that
[the] [p]laintiffs seek—quiet title and return of their property—would require th[e] [c]ourt to
‘review the state proceedings and determine that the foreclosure judgment was issued in error.’”
(quoting Vossbrinck, 773 F.3d at 427)); Quiroz v. U.S Bank Nat’l Ass’n, No. 10-CV-2485, 2011
WL 2471733, at *6 (E.D.N.Y. May 16, 2011) (“Requesting restoration of title to [the] plaintiffs
. . . essentially asks this court to vacate [the state judgment] in clear violation of RookerFeldman.”), adopted by 2011 WL 3471497 (E.D.N.Y. Aug. 5, 2011). (See also Compl. ¶¶ 47, 52
(“Plaintiff . . . seeks a determination that . . . Defendants in this lawsuit have no right or claim to
Title or Lien on or against the Property.”).) Underlying Nath’s request for relief is his allegation
that because “Chase Bank did not own the Note and Mortgage on filing date June 19, 2001, the
[State Court’s] decision granting [the] [State Court Foreclosure Judgment] and recognizing the
[L]oan [M]odification [A]greement is null[] [and] void ab initio.” (Compl. ¶ 30; see also, e.g.,
Mem. in Opp’n to Mot. for Dismissal (“Pl.’s Opp’n”) 2 (Dkt. No. 23) (“Therefore on filing date
of June 19, 2001, . . . Chase . . . had no standing under NYS laws. . . . Therefore [the State]
[C]ourt had no jurisdiction over this foreclosure case [and] any judgment rendered by [the State]
[C]ourt i[s] null & [v]oid ab initio.”).) Nath’s quiet title claims are thus barred by RookerFeldman, “as [they] directly challenge[] the validity of the [State Court Foreclosure Judgment]
by arguing [Private] Defendants lacked standing in that suit and, therefore, the state court
judgment should be voided.” Gurdon v. Doral Bank, No. 15-CV-5674, 2016 WL 721019, at *6
(S.D.N.Y. Feb. 23, 2016), adopted sub nom. Andrew Gurdon (Executor-419 Estates LLC) v.
Doral Bank, 2016 WL 3523737 (S.D.N.Y. June 22, 2016); see also Omotosho v. Freeman Invest.

16

& Loan, 136 F. Supp. 3d 235, 247 (D. Conn. 2016) (finding that the plaintiff’s allegation that
“the state court ‘judgment is void, and should be vacated or set aside,’ . . . is precisely the type of
case the Rooker-Feldman doctrine bars”).
The remainder of Nath’s claims seek either rescission of the Loan Modification
Agreement, or the cancellation—or declaration of invalidity—of various purported assignments
in the chain of title for the Subject Property. (See Compl. ¶¶ 53–79.) Nath’s attempt to
invalidate these various agreements and assignments underlying the State Court’s determination
that U.S. Bank had standing to foreclose on the Subject Property asks the “federal court to
review the state proceedings and determine that the foreclosure judgment was issued in error,”
which is barred by Rooker-Feldman. Vossbrinck, 773 F.3d at 427; see also Graham v. Select
Portfolio Servicing, Inc., 156 F. Supp. 3d 491, 504 (S.D.N.Y. 2016) (“[The plaintiff’s] claims
seek to review and reject the judgment of foreclosure on the grounds that the assignments were
invalid and that U.S. Bank had no right to the property at issue in the foreclosure proceeding.”);
Barbato, 2016 WL 158588, at *3 (dismissing as barred by Rooker-Feldman a claim “asking th[e]
[c]ourt to find that [the] [d]efendant does not own the [n]ote or [m]ortgage,” where each “must
have been found to be valid in order for the state court to issue a judgment of foreclosure on the
property in favor of [t]he defendant”). Plaintiff does not articulate how he was injured by any of
the allegedly void or invalid assignments or agreements apart from any role that they may have
played in the State Court’s decision to issue the State Court Foreclosure Judgment.12 Moreover,
only if the State Court Foreclosure Judgment is effectively overturned could Plaintiff possibly
12

For example, as alleged by Plaintiff, the 2001 Assignment was “improperly used as the
basis for the [State Court Foreclosure Judgment] and sale and the Loan Modification
Agreement.” (Compl. ¶ 29.) Moreover, in its December 9, 2010 Decision, the State Court
expressly relied on paragraphs 4–6 of the Tolman Affidavit, which recount the 2001 Assignment
that Plaintiff challenges here. (See State Court Dec. 2010 Decision 4 & n.5; Howard Decl. Ex.
3.)

17

point to any injury resulting from the existence of various assignments and agreements that
“cloud” his title.
Plaintiff’s own articulation of the purpose of this Action confirms that Rooker-Feldman
bars this Court from entertaining his claims. According to Plaintiff, the Action was brought “to
[q]uiet [t]itle on the [Subject] [P]roperty, to expunge any title claimed by Defendants with
respect to said property, to remove the cloud on the title held by Plaintiff, and to nullify [the]
[L]oan [M]odification [A]greement secured by the property.” (Compl. 1–2.) But, as discussed
above, “[t]o the extent [Nath] is seeking to have this Court grant [him] title to the [S]ubject
[Property], expunge [D]efendants’ purported interest therein, and/or to vacate the judgment of
foreclosure . . . on the basis that it was obtained fraudulently, [his] claims are barred by the
Rooker-Feldman doctrine.” Gordon v. First Franklin Fin. Corp., No. 15-CV-775, 2016 WL
792412, at *5 (E.D.N.Y. Feb. 29, 2016) (finding that Rooker-Feldman barred claims “seeking
. . . to quiet title to the subject premises by ‘expunging’ and ‘erasing entirely forever’ [the]
defendants’ purported interest therein” (alterations omitted)); see also Riley, 618 F. App’x at 17
(affirming district court’s dismissal of action pursuant to Rooker-Feldman where “the complaint
sought to remove six alleged clouds on [the plaintiff’s] claimed title to a Brooklyn property, as
well as a declaratory judgment of free-and-clear ownership” despite that the plaintiff’s
“ownership of the property . . . was already fully adjudicated and rejected in the prior state-court
proceedings”). Accordingly, Rooker-Feldman bars the Court from exercising jurisdiction over
Nath’s first six causes of action.
b. Res Judicata and Collateral Estoppel
Moreover, even if Rooker-Feldman was inapplicable, many, if not all, of Nath’s claims
would be barred by either res judicata or collateral estoppel.

18

i. Res Judicata – Standard
“Under New York law, the doctrine of claim preclusion [or res judicata] bars litigation of
claims or defenses that were or could have been raised in a prior proceeding where that prior
proceeding resulted in a final judgment on the merits and arose out of the same factual grouping
as the later claim, even where the later claim is based on different legal theories or seeks
dissimilar or additional relief.” L.A.M. Recovery, Inc. v. Dep’t of Consumer Affairs, 345 F.
Supp. 2d 405, 409–10 (S.D.N.Y. 2004); see also Hinds v. Option One Mortg. Corp., No. 11-CV6149, 2012 WL 6827477, at *5 (E.D.N.Y. Dec. 6, 2012) (noting that “New York has adopted a
transactional approach to res judicata, barring a later claim arising out of the same factual
grouping as an earlier litigated claim even if the later claim is based on different legal theories or
seeks dissimilar or additional relief” (italics and internal quotation marks omitted)), adopted by
2013 WL 132719 (E.D.N.Y. Jan. 10, 2013).13 “This transactional doctrine also applies to
defenses that could have been litigated in a foreclosure action.” Hinds, 2012 WL 6827477, at *5
(internal quotation marks omitted); see also Beckford v. Citibank N.A., No. 00-CV-205, 2000
WL 1585684, at *3 (S.D.N.Y. Oct. 24, 2000) (same). Accordingly, “[a] [f]oreclosure [j]udgment
is final as to all questions at issue between . . . parties, and concludes all matters of defense that
were or might have been litigated in the [f]oreclosure [a]ction.” Hourani v. Wells Fargo Bank,
N.A., 158 F. Supp. 3d 142, 147 (E.D.N.Y. 2016); see also Drew v. Chase Manhattan Bank, N.A.,
No. 95-CV-3133, 1998 WL 430549, at *6–7 (S.D.N.Y. July 30, 1998) (“Under New York law[,]
‘[a] state court judgment of foreclosure and sale entered against a defendant is final as to all
questions at issue between the parties, and all matters of defense which were or might have been
13

The Court applies New York’s preclusion rules because “a prior state court decision [is
given] the same preclusive effect that the courts of that state would give it.” Colon v. Coughlin,
58 F.3d 865, 869 n.2 (2d Cir. 1995).

19

litigated in the foreclosure action are concluded.’” (alteration omitted) (quoting Gray v. Bankers
Tr. Co., 442 N.Y.S.2d 610, 612 (App. Div. 1981))).
ii. Collateral Estoppel – Standard
Collateral estoppel, also known as issue preclusion, provides that “when an issue of
ultimate fact has once been determined by a valid and final judgment, the issue cannot again be
litigated between the same parties in any future lawsuit.” Swiatkowski v. Citibank, 745 F. Supp.
2d 150, 168 (E.D.N.Y. 2010) (internal quotation marks omitted), aff’d, 446 F. App’x 360 (2d
Cir. 2011); see also Tracy v. Freshwater, 623 F.3d 90, 99 (2d Cir. 2010) (“Collateral estoppel
precludes a party from relitigating in a subsequent action or proceeding an issue clearly raised in
a prior action or proceeding and decided against that party.” (internal quotation marks omitted)).
Accordingly, collateral estoppel will preclude a court from deciding an issue where “(1) the issue
in question was actually and necessarily decided in a prior proceeding, and (2) the party against
whom the doctrine is asserted had a full and fair opportunity to litigate the issue in the first
proceeding.” McKithen, 481 F.3d at 105 (internal quotation marks omitted); see also Hayes v.
Cty. of Sullivan, 853 F. Supp. 2d 400, 425 (S.D.N.Y. 2012) (same). “The party asserting issue
preclusion bears the burden of showing that the identical issue was previously decided, while the
party against whom the doctrine is asserted bears the burden of showing the absence of a full and
fair opportunity to litigate in the prior proceeding.” Colon v. Coughlin, 58 F.3d 865, 869 (2d Cir.
1995); see also Thomas v. Venditto, 925 F. Supp. 2d 352, 360 (E.D.N.Y. 2013) (same).
iii. Analysis
Counts One and Two, each founded upon Private Defendants’ alleged lack of interest in
the Subject Property and concomitant lack of standing to foreclose, are barred by both res

20

judicata and collateral estoppel.14 The issue of Private Defendants’ standing to foreclose on the
loan was necessarily decided by the State Court when it issued the Foreclosure Judgment. (See
State Court Dec. 2010 Decision 4–5 (finding “that [Chase] has established prima facie
entitlement to a judgment of foreclosure and sale”).) Moreover, not only could lack of standing
have been raised as a defense to the foreclosure judgment, it expressly was raised, based on
many of the same arguments that Plaintiff puts forward here. For example, in his Order to Show
Cause before the State Court, Nath argued that the 2001 Assignment was “subsequent to
commencement of the [Foreclosure Action].” (Order to Show Cause ¶ 43.) He also argued that,
because LaSalle no longer existed, it did not have the capacity to enter into the Loan
Modification Agreement with Plaintiff. (Id. ¶¶ 59–65.) Nath repeatedly makes the same
allegations here. (See, e.g., Compl. ¶ 8 (“At the time of the loan modification . . . La[S]alle

14

The requirement that the current Action be between the same parties as the original
action or those in privity with those parties is met here. “New York law provides that privity
extends to parties who are successors to a property interest, those who control an action although
not formal parties to it, those whose interests are represented by a party to the action, and
possibly coparties to a prior action.” Yeiser v. GMAC Mortg. Corp., 535 F. Supp. 2d 413, 423
(S.D.N.Y. 2008) (internal quotation marks omitted).
The Plaintiff in the Foreclosure Action was Chase, who was, as alleged by Plaintiff, the
“predecessor” of JPMorgan. (Compl. ¶ 15.) Next, SPS, “is the servicer of the mortgage loan on
[the Subject] [P]roperty,” (id. ¶ 3), and “district courts generally have found there to be privity
between a mortgage servicer and the owner of [the] mortgage,” Best v. Bank of Am., No. 14-CV6546, 2015 WL 5124463, at *3 (E.D.N.Y. Sept. 1, 2015); see also Fequiere v. Tribeca Lending,
No. 14-CV-812, 2016 WL 1057000, at *7 (E.D.N.Y. Mar. 11, 2016) (finding that a party was in
privity with a litigant where, “by [the] plaintiff’s own contention, [the party] serviced [the]
plaintiff’s mortgage until” another party acquired the mortgage”); Yeiser, 535 F. Supp. 2d at 423
(“GMAC’s interest in the mortgage loan was represented by MERS because GMAC serviced the
loan at the time of the foreclosure action . . . .”). Finally, U.S. Bank, as indenture trustee, is a
successor-in-interest to the Mortgage and Note. It bears noting that, even if privity did not exist
among the Private Defendants and Chase, “[u]nlike claim preclusion, the party invoking
collateral estoppel under New York law need not have been in privity with a litigant in the prior
action.” Best, 2015 WL 5124463, at *3; see also Koch v. Consolidated Edison Co. of N.Y., Inc.,
468 N.E.2d 1, 6 (N.Y. 1984) (“[E]fficient utilization of the judicial system is served by
preclusion of relitigation of issues as to which a litigant has had a full and fair opportunity for
resolution, irrespective of the identity of his particular opponent.”).

21

. . . just did not exist.” (emphasis omitted)); id. ¶ 20 (“[A]ccording to . . . records, La[S]alle
. . . had ceased to exist and act as a viable national banking association in 2008[,] but was
still . . . entering into agreements with me in 2010 . . . .”); id ¶ 28 (“Foreclosure complaint was
filed on June 19, 2001 but . . . Chase . . . did [n]ot acquire the mortgage note until July 19, 2001.
Therefore on filing date . . . Chase . . . had no standing to come to the court . . . .”).) To the
extent that Plaintiff argues that collateral estoppel should not apply because the State Court
rejected the standing-related arguments on waiver grounds (see Vacatur Denial), even if the
Court were to accept the argument, res judicata would bar the claims, as the doctrine bars
“defenses that could have been litigated in a foreclosure action.” Hinds, 2012 WL 6827477, at
*5 (emphasis added). Indeed, the State Court specifically held that it would not consider the
arguments because the evidence supporting them “w[as] available at the time of the prior motion
and appear to have been discoverable with appropriate diligence.” (Vacatur Denial 3.)
The same is true for Plaintiff’s efforts to invalidate the 2001 Assignment and Loan
Modification Agreement. Once more, not only could Plaintiff have raised defenses and
arguments challenging the 2001 Assignment and Loan Modification Agreement in the State
Court Foreclosure Proceeding, but he expressly did. (See Order to Show Cause ¶ 36 (“Since
[Chase] did not have the capacity to acquire the loan, the assignment to [Chase] was a nullity.
Therefore, [Chase] lacks standing to foreclose on the loan.”); id. ¶ 47 (“[T]he assignment, per se,
was defective.”); id. ¶ 60–62 (arguing that “the Settlement Agreement and Releases and the Loan
Modification Agreement between [Nath] and LaSalle” “is void” because LaSalle no longer
existed at the time the agreements were executed); State Court Dec. 2010 Decision 3 (expressly
denying “[Nath’s] motion for an order rescinding the loan modification”); id. at 4 & n.5 (relying
on portions of the Tolman Affidavit detailing the 2001 Assignment and noting that Nath “does

22

not refute the contents of the Tolman [A]ffidavit”).) Thus res judicata and collateral estoppel,
apart from the Rooker-Feldman doctrine, bar Plaintiff’s efforts to invalidate the 2001
Assignment and Loan Modification Agreement.15
2. Other Claims Against Private Defendants
The Court notes that after filing his Complaint, and memorandum in opposition to Private
Defendants’ Motion, Plaintiff, without permission from the Court, filed additional papers
purporting to raise a plethora of other claims. (See, e.g., Dkt. Nos. 39, 40, 53, 61, 66, 67.) The
papers appear to challenge the sale of the Subject Property (which occurred after the filing of this
Action) and purport to raise a number of claims regarding the sale (including the notice
provided), such as violations of 18 U.S.C. § 709, N.Y. R.P.A. § 1404, “Federal Penal Law”
§§ 1001, 1005, the FDCPA, N.Y. Gen. Bus. Law §§ 349, 350, the U.C.C. § 9-611, and N.Y.
Penal Law §§ 190.20, 190.25. (See, e.g., Dkt. No. 40.) The Court will not address these claims,
15

Moreover, Plaintiff’s TILA claim is barred by this Court’s ruling in Nath’s Bankruptcy
Appeal. Nath presented the same argument he presses here, namely that the Supreme Court’s
decision in Jesinoski v. Countrywide Home Loans, Inc., 135 S. Ct. 790 (2015), extended his time
to rescind the Mortgage, which, he claims, he did shortly after executing the Loan Modification
Agreement. (See, e.g., Compl. ¶ 8; see also Pl.’s Opp’n at unnumbered 5; Atty. Decl. of Casey
B. Howard in Connection with Defs.’ Reply in Supp. of Mot. To Dismiss Ex. 21 (“Hr’g Tr.”) 55
(Dkt. No. 26) (“[Nath] argues that under TILA, his time period to rescind the refinancing of the
loan by a different lender was automatically extended three years, and during his loan
modification dated March 2010[,] he never received the right to rescind notice, the TILA form
that explained his right to rescind notice.”).) But this Court already ruled that “TILA has no
application to the settlement agreement.” (Hr’g Tr. 55.) Indeed, even if the claim was not thus
barred by collateral estoppel, the Court would come to the same conclusion because “TILA
disclosure requirements do not apply to forbearance or loan modification agreements that simply
reduce the interest rate and payment schedule of a loan.” De Jose v. EMC Mortg. Corp., No. 11CV-139, 2011 WL 1539656, at *7 (N.D. Cal. Apr. 18, 2011); see also Diamond v. One West
Bank., No. 09-CV-1593, 2010 WL 1742536, at *5 (D. Ariz. Jan. 4, 2011) (“Generally . . . a loan
modification does not require additional TILA disclosures, particularly where no new monies are
advanced.”). The Modification “merely re-negotiated the terms of [Nath’s] existing loan” and
thus “TILA does not apply.” Johnson v. Bank of Am., N.A., No. 11-CV-42, 2014 WL 6694013,
at *1 (D. Idaho Sept. 16, 2014). (See also Settlement Agreement at unnumbered 8 (stating that
“nothing in the [Modification Agreement]” should be “understood or construed to be a
satisfaction or release in whole or in part of the Note and Security Instrument”).

23

raised by an experienced litigator for the first time in sur-reply briefs not authorized by the
Court. See Vlad-Berindan v. MTA N.Y.C. Transit, No. 14-CV-675, 2014 WL 6982929, at *6
(S.D.N.Y. Dec. 10, 2014) (“Where a plaintiff’s motion papers assert entirely new claims that do
not arise out of the facts alleged in the complaint, the court need not consider them.”); Conkling
v. Brookhaven Science Assocs., LLC, No. 10-CV-4164, 2012 WL 2160439, at *6 n.6 (E.D.N.Y.
June 12, 2012) (noting that “new claims not specifically asserted in the complaint may not be
considered by courts in deciding a motion to dismiss” (alteration and internal quotation marks
omitted)).16
3. Count Seven
Nath also brings a claim against the IRS related to tax liens issued by the IRS against the
Subject Property. (See Compl. ¶¶ 42–43, 81–85.) He alleges that the “liens have been computed
at the incorrect amount of federal taxes,” and that he “did not receive the proper notice and
hearings regarding the imposition of the[] federal tax lien,” thus violating his due process rights.
(Id. ¶¶ 83–85.) He seeks a declaration that (1) “the incorrect amount of federal taxes ha[s] been
computed to the federal tax lien,” (2) his “due process rights were violated before the imposition
of the federal tax lien on the Property,” and (3) “the federal tax lien on the Property is void,
invalid, and cancelled of record.” (Id. at Prayer for Relief.)
The IRS argues both that Nath has failed to establish subject matter jurisdiction, (Mem.
of Law in Supp. of IRS Mot. To Dismiss (“IRS Mem.”) 6–11 (Dkt. No. 44)), and that, to the
extent subject matter jurisdiction exists, Nath fails to state a claim, (id. at 11–15).

16

Moreover, a number of the claims raised and arguments made in Plaintiff’s letters
appear in Plaintiff’s Amended Complaint in his other pending civil action addressing these
matters, (see generally Am. Compl. (Dkt. No. 9, 15-CV-8183 Dkt.)), and he filed a number of
the same letters in their entirety in both actions.

24

Sovereign immunity dictates that the United States cannot be sued without its consent.
See United States v. Mitchell, 463 U.S. 206, 212 (1983). Thus, “[w]hen an action is brought
against the United States government,” waiver of “sovereign immunity is necessary for subject
matter jurisdiction to exist.” Williams v. United States, 947 F.2d 37, 39 (2d Cir. 1991). The
sovereign immunity doctrine extends to federal agencies. See Robinson v. Overseas Military
Sales Corp., 21 F.3d 502, 510 (2d Cir. 1994); see also Clavizzao v. United States, 706 F. Supp.
2d 342, 346 (S.D.N.Y. 2009) (same). Although Nath cites a number of federal statutes in the
Complaint’s jurisdictional statement, none of those statutes waives the Government’s sovereign
immunity in this situation. The Court will address those first, and then will consider other
statutory authority that bears on the question of subject matter jurisdiction.
First, Nath invokes 28 U.S.C. § 1331 as a basis for jurisdiction, but the general federal
question jurisdiction statute “is in no way a general waiver of sovereign immunity.” Doe v.
Civiletti, 635 F.2d 88, 94 (2d Cir. 1980); see also Morales v. Related Mgmt. Co., No. 13-CV8191, 2015 WL 7779297, at *5 (S.D.N.Y. Dec. 2, 2015) (same). Nath also cites to TILA, 15
U.S.C. § 1601 et seq., as a basis for federal jurisdiction, but TILA “include[s] [a] provision
expressly preserving sovereign immunity.” Stellick v. U.S. Dep’t of Educ., No. 11-CV-730, 2013
WL 673856, at *3 (D. Minn. Feb. 25, 2013); see also 15 U.S.C. § 1612(b) (“No civil or criminal
penalty provided under this subchapter for any violation thereof may be imposed upon the
United States or any department or agency thereof . . . .”). Nath’s invocation of IRS Real Estate
Mortgage Investment Conduit (“REMIC”) regulations is similarly unavailing, because no private
right of action exists to enforce the regulations. See Obal v. Deutsche Bank Nat’l Tr. Co., No.
14-CV-2463, 2015 WL 631404, at *4 (S.D.N.Y. Feb. 13, 2015) (collecting cases),
reconsideration denied, 2015 WL 3999455 (S.D.N.Y. June 29, 2015); see also Springer v. U.S.

25

Bank Nat’l Ass’n, No. 15-CV-1107, 2015 WL 9462083, at *9 (S.D.N.Y. Dec. 23, 2015) (“The
weight of well-reasoned authority rejects the existence of such a private right of action.”).
Finally, Nath’s references to “banking laws,” alleged fraud that was committed in federal courts,
and the existence of ongoing bankruptcy cases do not reveal a waiver of sovereign immunity.17
As noted by the IRS, the Declaratory Judgment Act (“DJA”) also limits Nath’s ability to
bring his claim. As relevant here, the DJA forbids courts from declaring obligations “with
respect to Federal taxes.” 28 U.S.C. § 2201(a); see also Black v. United States, 534 F.2d 524,
527 n.3 (2d Cir. 1976) (“28 U.S.C. § 2201, which generally provides for declaratory judgments,
contains a specific exception for matters relating to federal taxes.”); Lapadula & Villani, Inc. v.
United States, 563 F. Supp. 782, 784 (S.D.N.Y. 1983) (“The Declaratory Judgment Act
expressly provides that a Court may not declare the rights and other legal relations of interested
parties where federal taxes are at issue.” (citation omitted)). Accordingly, with one possible
exception discussed below, the DJA bars Nath’s demand that the Court declare that the incorrect
amount of federal taxes were levied, that his due process rights were violated before the IRS
imposed the tax lien on the Subject Property, or that the federal tax lien is void.18

17

The Court notes that, although 28 U.S.C. § 1340 “gives the federal district courts
‘original jurisdiction of any civil action arising under any Act of Congress providing for internal
revenue,’ [the statute is] . . . a general jurisdictional statute, [and so] it does not . . . itself
constitute a waiver of sovereign immunity.” SEC v. Credit Bancorp, Ltd., 297 F.3d 127, 137 (2d
Cir. 2002) (citation omitted) (quoting 28 U.S.C. § 1340)).
18

Moreover, the Tax Anti-Injunction Act provides that “no suit for the purpose of
restraining the assessment or collection of any tax shall be maintained in any court by any
person.” 26 U.S.C. § 7421(a). Since Nath is a “person,” (Compl. ¶ 1), and his requested relief of
voiding the tax lien on the Subject Property would be for the purposes of “restraining the
assessment or collection of any tax,” Nath’s claims against the IRS are also barred by the AntiInjunction Act. See Bob Jones Univ. v. Simon, 416 U.S. 725, 736 (1974) (noting that the Tax
Anti-Injunction Act’s “language could scarcely be more explicit”); Randell v. United States, 64
F.3d 101, 106 (2d Cir. 1995) (“In the context of tax assessments and collections the
government’s sovereign immunity has been codified by the [Tax] Anti-Injunction Act . . . .”); see

26

This is so even with respect to Nath’s request for a declaration that his due process rights
were violated, as “courts routinely dismiss requests for judgments declaring federal tax
obligations, even in the face of ‘lengthy recital[s] of assumed violations of constitutional
rights.’” Clavizzao, 706 F. Supp. 2d at 347 (alteration in original) (quoting Jolles Found. v.
Moysey, 250 F.2d 166, 169 (2d Cir. 1957)); see also Laing v. United States, 496 F.2d 853, 854
(2d Cir. 1974) (per curiam) (finding no jurisdiction over the plaintiff’s request to issue “a
declaratory judgment that the provisions of the Internal Revenue Code under which the
assessment and levy on [the plaintiff’s] property were made were unconstitutional”), rev’d on
other grounds, 423 U.S. 161 (1976); Lewis v. Comm’r, Internal Revenue, No. 03-CV-4296, 2004
WL 1110276, at *3 (S.D.N.Y. Apr. 29, 2004) (report and recommendation) (“[T]o the extent that
[the plaintiff] seeks a declaratory judgment that his rights were violated, his complaint runs afoul
of . . . the [DJA], which expressly states that declaratory relief is unavailable ‘with respect to
Federal taxes’”); Mangione v. IRS, No. 97-CV-9439, 1998 WL 401538, at *3 (S.D.N.Y. July 17,
1998) (dismissing for lack of subject matter jurisdiction an action seeking a declaratory judgment
that the plaintiff is not subject to federal taxes); Tucker v. United States, No. 96-CV-6039, 1998
WL 708923, at *3 (E.D.N.Y. July 6, 1998) (noting that even claims of “deprivation of
constitutional rights are not sufficient to” overcome the DJA’s jurisdictional bar); Schecter v.
United States Treasury Dep’t, No. 85-CV-3306, 1986 WL 14555, at *3 (E.D.N.Y. Aug. 6, 1986)
(“Th[e] exception for tax matters is a very broad one, and applies regardless of a recital of
alleged violations of constitutional rights.” (citation omitted)); cf. Tornichio v. United States, No.
02-CV-351, 2002 WL 508325, at *3 (N.D. Ohio Mar. 18, 2002) (“If [the plaintiff] is also seeking

also Morris v. United States, 540 F. App’x 477, 481 (6th Cir. 2013) (noting that challenge to a
federal lien falls within the Anti-Injunction Act’s prohibitions despite the lien having already
been filed because the Act bars suits interfering with both the assessment and collection of
taxes).

27

to assert a procedural due process claim, this court nonetheless lacks jurisdiction[] [because]
[d]istrict courts have no jurisdiction over civil claims challenging taxes unless litigants first pay
the assessed tax and then raise the[ir] claims in a refund suit.”). As the IRS points out, Nath’s
due process allegations “concern[] the manner in which the IRS assessed taxes and placed liens
on the Subject Property.” (IRS Mem. 8.) As such, the claim is made “with respect to federal
taxes.”19
Although Nath makes no reference to the statute, 28 U.S.C. § 2410(a) “constitutes a
limited waiver of sovereign immunity, SEC v. Credit Bancorp., Ltd., 297 F.3d 127, 138 (2d Cir.
2002), and may be relevant to Nath’s claims. Under the statute, “the United States may be
named as a party in any civil action or suit in any district court . . . to quiet title to . . . real or
personal property on which the United States has or claims a mortgage or other lien.” 28 U.S.C.
§ 2410(a)(1).20 “This section does not authorize a taxpayer to challenge an IRS assessment of
his tax liability.” Kulawy v. United States, 917 F.2d 729, 733 (2d Cir. 1990); see also Falik v.
United States, 343 F.2d 38, 42 (2d Cir. 1965) (same). “Rather, the taxpayer may only contest the
procedural validity of a tax lien.” Elias v. Connett, 908 F.2d 521, 527 (9th Cir. 1990); see also
Estate of Rao v. United States, 987 F. Supp. 249, 251 (S.D.N.Y. 1997) (“[S]ection [2410] does
not allow the aggrieved taxpayer to collaterally attack the substantive validity of the underlying
19

Moreover, Nath cannot maintain a Bivens claim against the IRS for an alleged due
process violation because Bivens has not been extended to suits against federal agencies. See
Fed. Deposit Ins. Co. v. Meyer, 510 U.S. 471, 484 (1994) (refusing to extend Bivens to federal
agencies and noting that individual defendants must be named); see also Clavizzao, 706 F. Supp.
2d at 347 n.7 (holding that the Court could not “construe [the] [p]laintiffs’ allegations [against
the IRS] as Bivens claims, because [the] [p]laintiffs did not name specific federal agents as
defendants, nor even suggest any misconduct by any particular officials” (citation omitted)).
20

It bears noting that even if the property upon which the Government has the disputed
lien is sold during the pendency of the action, “nothing in § 2410(a)(1) . . . permits the
government to oust the court of jurisdiction validly invoked.” Kulawy v. United States, 917 F.2d
729, 733–34 (2d Cir. 1990).

28

tax assessment that led to the lien, but it does permit challenges premised on procedural
irregularities.” (citation omitted)). “A procedural claim is one which does not challenge the
existence or extent of substantive tax liability,” and includes claims that the IRS failed “to assess
the tax properly or to send valid notices of assessment.” Johnson v. United States, 990 F.2d 41,
43 (2d Cir. 1993) (internal quotation marks omitted); see also United States v. Cabral, No. 07CV-1741, 2008 WL 4911902, at *3 (E.D. Cal. Nov. 14, 2008) (“Where a plaintiff alleges that an
IRS lien is invalid because the IRS failed to send him valid notice of assessment and demand for
payment, a [§] 2410(a) claim may exist.”).
Clearly, the Government has not waived its sovereign immunity through § 2410(a) as to
the portion of Nath’s claim against the IRS that the “liens have been computed at the incorrect
amount of federal taxes,” (Compl. ¶ 83), and requesting a declaration to that effect, because such
a claim “challenge[s] the . . . extent of substantive tax liability.” Johnson, 990 F.2d at 43
(internal quotation marks omitted). But Nath’s Complaint can also be read to allege that the
Government’s lien is void because of procedural irregularities in the assessment and filing of the
lien. (See Compl. ¶ 84 (“Plaintiff did not receive the proper notice and hearings regarding the
imposition of these federal tax lien[s].”); see also Pl.’s Reply Br. Opposing IRS Mot. To Dismiss
Compl. 1 (Dkt. No. 52) (“No accounting was provided to me detailing the original tax amounts,
how these taxes were computed and on what basis . . . any penalties [and] late charges [were]
levied.”).) Such allegations can be read to allege a failure to follow certain procedural
requirements, including the need to, after making an assessment of tax, “give notice to each
person liable for the unpaid tax, stating the amount and demanding payment thereof,” 26 U.S.C.
§ 6303(a), or the requirement that a taxpayer be “notif[ied] in writing” of “the filing of lien under
[§] 6323,” 26 U.S.C. § 6320. Because these present challenges to the procedural validity of the

29

lien, the Government has waived its sovereign immunity, and this Court, at first glance, can
exercise jurisdiction over Plaintiff’s claim. See, e.g., Ennis v. Pointer, No. 02-CV-5091, 2003
WL 22064037, at *4 (N.D. Cal. Aug. 29, 2003) (“Failure to send notices of assessment and
demands for payment as required by 26 U.S.C. § 6303(a) is a cognizable procedural defect under
[§] 2410, and thus this [c]ourt has jurisdiction to address it.” (citing Huff v. United States, 10
F.3d 1440, 1445 (9th Cir. 1993)); Rand v. United States, 818 F. Supp. 566, 568 (W.D.N.Y. 1993)
(“Because [the] plaintiff’s quiet title action pursuant to 28 U.S.C. § 2410 is directed to the
propriety of the procedures used, the United States has waived its sovereign immunity to be
sued.”); Gentry v. United States, No. 89-CV-337, 1991 WL 191246, at *4 (E.D. Tenn. July 22,
1991) (“[S]o long as the merits of the underlying assessments are not contested, challenges to the
regularity of a tax lien (including challenges under [§] 6203 and 6303(a)) are cognizable under
[§] 2410.”); cf. James v. United States, 970 F.2d 750, 755 (10th Cir. 1992) (“[The] [p]laintiffs’
assertion that the required notice of intent to levy under § 6331(d) was not sent to [the] plaintiffs
is a claim within the grant of jurisdiction under § 2410.”).
However, actions brought pursuant to § 2410 are subject to the catch-all six-year statute
of limitiations for civil actions commenced against the United States, found in 28 U.S.C.
§ 2401(a). See Macklin v. United States, 300 F.3d 814, 821 (7th Cir. 2002); see also Nesovic v.
United States, 71 F.3d 776, 778 (9th Cir. 1995) (same). Plaintiff attaches two federal tax liens to
his Complaint, the latest of which was filed on April 7, 2008. (See Dkt. 1-5 at unnumbered 23.)
But Plaintiff did not file this Action until May 21, 2015 (see Dkt. No. 1), more than seven years
after the filing of the tax lien, and after the statute of limitations had run.21 To the extent

21

Moreover, “[a] federal tax lien attaches to a taxpayer’s property when unpaid taxes are
assessed.” Nesovic, 71 F.3d at 778 (internal quotation marks omitted). Accordingly, Plaintiff’s

30

equitable tolling is applicable to the six-year statute of limitations found § 2401(a), see Bertin v.
United States, 478 F.3d 489, 494 n.3 (2d Cir. 2007) (“We have previously held that equitable
tolling may be available for actions against the federal government . . . and may toll the catch-all
statute of limitations.” (citations omitted)), Plaintiff has not pled any facts warranting such
tolling, see Chapman v. Choicecare Long Island Term Disability Plan, 288 F.3d 506, 512 (2d
Cir. 2002) (“Generally, to merit equitable relief, a plaintiff must have acted with reasonable
diligence during the time period []he seeks to have tolled . . . [and] the burden of proving that
tolling is appropriate rests on the plaintiff.”). Plaintiff has not pled any facts that bear on his
exercise of reasonable diligence; importantly, even if the IRS failed to provide any notice of the
lien, Plaintiff obviously learned of the federal tax lien at some point, but he does not explain how
or when and thus the Court cannot conclude that he was reasonably diligent. See Viti v.
Guardian Life Ins. Co. of Am., No. 10-CV-2908, 2013 WL 6500515, at *17 n.7 (S.D.N.Y. Dec.
11, 2013) (“Parties seeking equitable tolling must make a showing of reasonable diligence not
only throughout the period to be tolled but also throughout the rest of the limitations period.”).
Because Plaintiff filed his challenge to the lien more than six years after the claim accrued, his
claim is time-barred.
III. Conclusion
In light of the foregoing analysis, the Court grants Private Defendants’ Motion in its
entirety, and Plaintiff’s claims against the Private Defendants are dismissed with prejudice. The
IRS’s Motion is granted. Plaintiff’s claims against the IRS are dismissed with prejudice, except
for his claim challenging the procedural validity of the tax liens issued against the Subject
Property. With respect to that claim, and that claim only, Plaintiff may file an Amended

claim accrued even more than seven years ago. The distinction, however, makes no difference to
the present claim at this point.

31

Complaint, which must be filed with this Court within 30 days. 22 Failure to do so may result in
dismissal ofhis remaining claim against the IRS with prejudice. The Clerk of Court is
respectfully requested to terminate the pending Motions. (Dkt. Nos. 20, 43.)
SO ORDERED.
DATED:

September'?:LQ_, 2016
White Plains, New York

22

Further, Plaintiff must effect proper service as required by Federal Rule of Civil
Procedure 4(i) within 60 days of the date on which he files his Amended Complaint. There will
be no extensions, and failure to properly effect service within the allotted time may result in
dismissal ofPlaintiffs claims.
32