United States District Court, D. Colorado
MARGARET A. SILVA, Plaintiff,
US BANK, NATIONAL ASSOC., as Trustee under the Pooling and Service Agreement dated as of February 1, 2007, GSAMP trust 2007-NCI, MORTGAGE PASS-THROUGH CERTIFICATES, series 207, NCI, PAUL KING, District Court Judge, in his individual capacity, DAVID J. STEVENS, District Court Judge, in his individual capacity, 18TH JUDICIAL DISTRICT, Court of Colo. Arapahoe County, RICHARD B. CASCHETTE, District Court Judge, in his individual capacity, CHRISTINE DUFFY, Douglas County Public Trustee, in her individual capacity, LAWRENCE E. CASTLE, in his corporate capacity, ROBERT J. HOPP, in his individual and corporate capacity, MERS INC., a division of MERSCORP INC., and Does 1-10, Defendants.
RECOMMENDATION OF UNITED STATES MAGISTRATE
Kristen L. Mix, United States Magistrate Judge
matter is before the Court on the following motions: (1)
Defendant Christine Duffy's Motion to Dismiss the
Second Amended Complaint [#57]
(“Duffy's Motion”), (2) Defendant Robert J.
Hopp's Motion to Dismiss the Second Amended
Complaint Pursuant to Fed. R. 12(b)(1) and Fed. R.
12(b)(6) [#59] (“Hopp's Motion”),
(3) Defendants Judge Paul King, Judge David J. Stevens, Judge
Richard B. Caschette, and the 18th Judicial District Court of
Colorado Arapahoe County's Motion to
Dismiss [#61] (the “Judicial Defendants'
Motion”), (4) Defendants U.S. Bank and MERS'
Motion to Dismiss Second Amended Complaint
[#62] (“US Bank and MERS' Motion”), and (5)
Defendant Lawrence E. Castle's Motion to Dismiss
Plaintiff's Second Amended Complaint Pursuant to
Fed.R.Civ.P. 12(b)(6) [#80] (“Castle's
Motion”). Plaintiff filed Responses [#65, #66, #75,
#84] to Defendants U.S. Bank and MERS, Duffy, the Judicial
Defendants, and Castle's Motions,
respectively. Defendant U.S. Bank and MERS, Duffy, the
Judicial Defendants, and Castle filed Replies [#77, #76, #79,
#88, respectively]. No Response or Reply was filed with
respect to Hopp's Motion [#59].
to 28 U.S.C. § 636(b)(1) and D.C.COLO.LCivR 72.1(c)(3),
the Motions have been referred to the undersigned for
recommendation. See [#58, #60, #63, #64, #81].
Having reviewed all motions and related briefing, the entire
case file, the relevant law, and being sufficiently advised
in the premises, the Court respectfully
RECOMMENDS that all Defendants' Motions
[#57, #59, #61, #62, #80] be GRANTED.
challenges the foreclosure of her residential property (the
“Property”). Plaintiff previously filed a lawsuit
in this Court (13-cv-02289-MSK-CBS), in which a settlement
agreement was reached between Plaintiff and Ocwen Loan
Servicing. Plaintiff later disputed the settlement agreement
and the case was ultimately administratively closed on
September 15, 2014, in order for the parties to discuss
alternative resolutions to the litigation. See Order
[#101]. To date, the 2013 matter has not been reopened.
who is proceeding pro se,  filed a Complaint [#1] initiating the
present lawsuit on June 23, 2017. Plaintiff filed a series of
motions for injunctive relief seeking to enjoin the state
court from proceeding with a Forcible Entry and Detainer
proceeding. The Court recommended denying the earlier motions
due to procedural deficiencies, and most recently recommended
denying Plaintiff's request for injunctive relief because
the Court found that Plaintiff had failed to show a
likelihood of success on the merits. See
Recommendation [#56]. The District Judge adopted the
Recommendation. Order [#67]. Meanwhile, Plaintiff
successfully amended her pleadings, the operative pleading
now being the Second Amended Complaint [#47].
raises eight enumerated claims for relief in the Second
Amended Complaint [#47]: (1) due process and equal protection
violations of the Fourteenth Amendment pursuant to 42 U.S.C.
§ 1983, (2) conspiracy pursuant to § 1983, (3)
fraud by misrepresentation and non-disclosure, (4) unjust
enrichment, (5) a request for injunctive relief pursuant to
Ex Parte Young, and (6) misfeasance in public
office. Second Am. Compl. [#47] at 1-2.
Plaintiff alleges that § 38-38-101 of the Colorado
Revised Statutes as amended by HB-1387, which provide the
basis for Colorado's foreclosure procedures under Rule
120, violate the Fourteenth Amendment. Plaintiff brings these
claims against the following Defendants: (1) the assignee and
assignor of the deed of trust on her residence (Defendants
U.S. Bank and MERS), (2) three State Court District Judges
who presided over her state court proceedings (Defendant
Judges Caschette, Stevens, and King) and the District where
the proceedings took place (Defendant 18th Judicial
District), (3) a Public Trustee (Defendant Duffy), and (4)
two private attorneys (Defendants Castle and
relief, Plaintiff seeks an order voiding the foreclosure and
setting aside any foreclosure sale, a declaration that the
amendments to Colorado's foreclosure statute are
unconstitutional, a declaration that Rule 120 is procedurally
defective, $1, 000, 000 in damages each from Defendants
Castle and Hopp, and other related relief. See Second Am.
Compl. [#47] at 39-41.
October 20, 2017, Defendants U.S. Bank and MERS filed a
Suggestion of Bankruptcy, and Notice of Relief from Stay
[#83] stating that Plaintiff has filed for Chapter 7
Bankruptcy protection (No. 17-17973-EEB), but that the United
States Bankruptcy Court for the District of Colorado granted
a relief from stay “to proceed with litigation
pending” in the present matter. See [#83].
Federal Rule of Civil Procedure 12(b)(1)
purpose of a motion to dismiss pursuant to Rule 12(b)(1) is
to test whether the Court has jurisdiction to properly hear
the case before it. Because “federal courts are courts
of limited jurisdiction, ” the Court must have a
statutory basis to exercise its jurisdiction. Montoya v.
Chao, 296 F.3d 952, 955 (10th Cir. 2002); Fed.R.Civ.P.
12(b)(1). Statutes conferring subject-matter jurisdiction on
federal courts are to be strictly construed. F & S
Const. Co. v. Jensen, 337 F.2d 160, 161 (10th Cir.
1964). “The burden of establishing subject-matter
jurisdiction is on the party asserting jurisdiction.”
Id. (citing Kokkonen v. Guardian Life Ins. Co.
of Am., 511 U.S. 375, 377 (1994)).
motion to dismiss pursuant to Rule 12(b)(1) may take two
forms: facial attack or factual attack. Holt v. United
States, 46 F.3d 1000, 1002 (10th Cir. 1995). When
reviewing a facial attack on a complaint, the Court accepts
the allegations of the complaint as true. Id. By
contrast, when reviewing a factual attack on a complaint, the
Court “may not presume the truthfulness of the
complaint's factual allegations.” Id. at
1003. With a factual attack, the moving party challenges the
facts upon which subject-matter jurisdiction depends.
Id. The Court therefore must make its own findings
of fact. Id. In order to make its findings regarding
disputed jurisdictional facts, the Court “has wide
discretion to allow affidavits, other documents, and a
limited evidentiary hearing.” Id. (citing
Ohio Nat'l Life Ins. Co. v. United States, 922
F.2d 320, 325 (6th Cir. 1990); Wheeler v. Hurdman,
825 F.2d 257, 259 n.5 (10th Cir. 1987)). The Court's
reliance on “evidence outside the pleadings” to
make findings concerning purely jurisdictional facts does not
convert a motion to dismiss pursuant to Rule 12(b)(1) into a
motion for summary judgment pursuant to Rule 56. Id.
Federal Rule of Civil Procedure 12(b)(6)
purpose of a motion to dismiss pursuant to Rule 12(b)(6) is
to test “the sufficiency of the allegations within the
four corners of the complaint after taking those allegations
as true.” Mobley v. McCormick, 40 F.3d 337,
340 (10th Cir. 1994); Fed.R.Civ.P. 12(b)(6) (stating that a
complaint may be dismissed for “failure to state a
claim upon which relief can be granted”). “The
court's function on a Rule 12(b)(6) motion is not to
weigh potential evidence that the parties might present at
trial, but to assess whether the plaintiff's complaint
alone is legally sufficient to state a claim for which relief
may be granted.” Sutton v. Utah State Sch. for the
Deaf & Blind, 173 F.3d 1226, 1236 (10th Cir. 1999)
(citation omitted). To withstand a motion to dismiss pursuant
to Rule 12(b)(6), “a complaint must contain enough
allegations of fact ‘to state a claim to relief that is
plausible on its face.'” Robbins v.
Oklahoma, 519 F.3d 1242, 1247 (10th Cir. 2008) (quoting
Bell Atlantic Co. v. Twombly, 550 U.S. 544, 570
(2007)); see also Shero v. City of Grove, Okla., 510
F.3d 1196, 1200 (10th Cir. 2007) (“The complaint must
plead sufficient facts, taken as true, to provide
‘plausible grounds' that discovery will reveal
evidence to support the plaintiff's allegations.”
(quoting Twombly, 550 U.S. at 570)). “A claim
has facial plausibility when the plaintiff pleads factual
content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). “A pleading that offers labels and conclusions
or a formulaic recitation of the elements of a cause of
action will not do. Nor does a complaint suffice if it
tenders naked assertion[s] devoid of further factual
enhancement.” Id. (brackets in original;
internal quotation marks omitted).
survive a motion to dismiss pursuant to Rule 12(b)(6), the
factual allegations in the complaint “must be enough to
raise a right to relief above the speculative level.”
Christy Sports, LLC v. Deer Valley Resort Co., 555
F.3d 1188, 1191 (10th Cir. 2009). “[W]here the
well-pleaded facts do not permit the court to infer more than
the mere possibility of misconduct, ” a factual
allegation has been stated, “but it has not show[n][
]that the pleader is entitled to relief, ” as required
by Fed.R.Civ.P. 8(a). Iqbal, 552 U.S. at 679 (second
brackets added; citation and internal quotation marks
Claims against Defendant Hopp
initial matter, Defendant Hopp advises the Court that he
filed for Chapter 7 bankruptcy protection on June 25, 2013
(No. 13-20838-SBB). His case was discharged on February 10,
2014, and then closed on March 19, 2014. A permanent
injunction and stay was issued under 11 U.S.C. § 727.
Defendant asserts that all claims against him should be
dismissed because the allegations against Defendant Hopp
occurred prior to June 25, 2013, and Plaintiff did not file
an adversary action in Defendant Hopp's bankruptcy case.
See Second Am. Compl. [#47] at 4 (alleging that
Defendant Hopp was referred to the Public Trustee Association
to streamline the foreclosure process between 2002-2006). It
should be noted that Defendant Hopp does not cite to any
legal authority in support of his position.
Chapter 7 bankruptcy discharges the debtor from debts arising
before the date of discharge. 11 U.S.C. § 727.
“Debt” means “liability on a claim, ”
and “claim” means the “right to payment,
whether or not such right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured, or
unsecured.” 11 U.S.C. § 101(12), (5). However,
debt may only be discharged with respect to creditors who
received actual, timely notice of the bankruptcy proceedings.
11 U.S.C. § 523(a)(3); see also In re Green,
876 F.2d 854, 856 (10th Cir. 1989); Reliable Elec. Co. v.
Olson Constr. Co., 726 F.2d 620, 622 (10th Cir. 1984)
(due process requires adequate notice to a creditor before
its rights can be adversely affected). Here, Defendant Hopp
has not indicated whether Plaintiff received actual, timely
notice of the Chapter 7 proceedings. See 11 U.S.C.
§ 523(a)(3). Accordingly, the Court considers
Plaintiff's claims against him in section D.3.b. below.
Prior Settlement Agreement with Defendant U.S. Bank
U.S. Bank argues that Plaintiff is barred from bringing all
stated claims against it due to the Settlement Agreement that
was executed at the end of her 2013 case. US Bank and
MERS' Motion [#62] at 9-10. The Settlement
Agreement, which Plaintiff attached to her First Amended
Complaint [#16],  provides:
Borrowers [Plaintiff] . . . hereby unconditionally,
irrevocably, forever and fully releases, acquits, and forever
discharges U.S. Bank . . . [and] Ocwen . . . of and from any
and all claims, demands, actions, causes of action, suits,
liens, debts, obligations, promises, agreements, costs,
damages, liabilities, and judgments of any kind . . . whether
known or unknown . . . which were or could have been raised
in, arise out of, relate to, or in any way, directly or
indirectly, involve the  Action, the Property, the
Note, the Deed of Trust, or the Loan . . . .
Settlement Agreement [#16] at 85-92.
law holds that a court may “summarily enforce a
settlement agreement if it is undisputed that a settlement
exists.” DiFrancesco v. Particle Interconnect
Corp., 39 P.3d 1243, 1247 (Colo.App. 2001) (citing
Goltl v. Cummings, 380 P.2d 556 (Colo. 1963)).
However, here Plaintiff alleges that Defendant U.S. Bank did
not negotiate in good faith, and asserts that U.S. Bank
failed to comply with its obligation to modify the loan so
that Plaintiff could remain on the Property. Second
Amended Complaint [#47] at 7. Giving Plaintiff's
allegations the broad deference afforded to pro se
litigants' filings, Plaintiff sufficiently alleges a
material breach of contract that may have released her from
waiving the right to assert these claims. See Carfield
& Sons, Inc. v. Cowling, 616 P.2d 1008, 1010
(Colo.App. 1980) (stating that major breaches may terminate
the non-breaching party's obligations under the
contract). Accordingly, the Court considers the
claims asserted against Defendant U.S. Bank below.
Claims Against State Court Judicial District and Individual
alleges that Defendant Caschette, a State Court District
Judge, “denied plaintiff due process in a procedurally
defective Rule 120 [proceeding].” See Second Am.
Compl. [#47] ¶¶ 98-101, 108-113. The
allegations underlying this statement appear to be that
Defendant Judge Caschette denied Plaintiff's motion to
vacate the Rule 120 complaint and entered an Order of Sale
without a hearing. Id. Defendants Stevens and King
are the State Court District Judges who presided over the
Forcible Entry and Detainer proceeding, which Plaintiff
asserts violates the Fourteenth Amendment because the
proceeding reinforced the unlawful Rule 120 proceeding.
Id. ¶¶ 103, 177. Plaintiff's claims
are brought against the three judges in their individual
to the Eleventh Amendment, the Court lacks subject matter
jurisdiction to adjudicate an action brought by a citizen of
a state against the state itself, its agencies, or its
officials in their official capacities. See Johns v.
Stewart, 57 F.3d 1544, 1552 (10th Cir.1995). “It
is well established that absent an unmistakable waiver by the
state of its Eleventh Amendment immunity, or an unmistakable
abrogation of such immunity by Congress, the amendment
provides absolute immunity from suit in federal courts for
states and their agencies.” Ramirez v. Oklahoma
Dep't of Mental Health, 41 F.3d 584, 588 (10th Cir.
1994), overruled on other grounds by Ellis v. University
of Kansas Med. Ctr., 163 F.3d 1186 (10th Cir. 1998).
Here, Plaintiff concedes that Defendant 18th Judicial
District is an arm of the state. Second Am. Compl.
[#47] at 37. Indeed, judicial districts are considered state
courts under Article VI of the Colorado Constitution, which
also provides the jurisdictional limitations, parameters for
the creation of judicial districts, term limits for district
judges, and other such rules. See Judicial
Defendants' Motion [#61] at 5. Additionally, at
least one other case in this District has held that judicial
districts are entitled to Eleventh Amendment immunity.
See Fey v. Washington, No. 16-CV-03103-WJM-MEH, 2017
WL 1344451, at *5 (D. Colo. Apr. 12, 2017). Thus, the Court
finds that Defendant 18th Judicial District is an arm of the
state for immunity purposes.
to Plaintiff's arguments in the Response [#75], the State
of Colorado has not waived its Eleventh Amendment immunity,
see Griess v. Colorado, 841 F.2d 1042, 1044-45 (10th
Cir. 1988), and congressional enactment of § 1983 did
not abrogate Eleventh Amendment immunity, see Quern v.
Jordan, 440 U.S. 332, 340-345 (1979). The Eleventh
Amendment applies to all suits against the state and its
agencies, regardless of the relief sought. See
Higganbotham v. Okla. Transp. Comm'n, 328 F.3d 638,
644 (10th Cir. 2003). Therefore, the Court respectfully
recommends that the claims against Defendant
18th Judicial District be dismissed without
prejudice for lack of subject matter jurisdiction on
the basis of Eleventh Amendment immunity. See Brereton v.
Bountiful City Corp., 434 F.3d 1213, 1216 (10th Cir.
2006) (“[W]here the district court dismisses an action
for lack of jurisdiction, . . . the dismissal must be without
prejudice.” (citations omitted)).
the Court turns to the claims against the individual judicial
defendants. “[A]bsolute immunity is necessary so that
judges can perform their functions without harassment or
intimidation.” Van Sickle v. Holloway, 791
F.2d 1431, 1435 (10th Cir. 1986). A judge will lose judicial
immunity only for (1) “nonjudicial actions,
i.e., actions not taken in the judge's judicial
capacity” or (2) judicial actions “taken in the
complete absence of all jurisdiction.” Mireles v.
Waco, 502 U.S. 9, 11-12 (1991). “[T]he factors
determining whether an act by a judge is a
‘judicial' one relate to the nature of the act
itself, i.e., whether it is a function normally
performed by a judge, and to the expectations of the parties,
i.e., whether they dealt with the judge in his
judicial capacity.” Stump v. Sparkman, 435
U.S. 349, 362 (1978).
Plaintiff has challenged the propriety of the individual
judges' (Caschette, King, and Stevens) actions in
connection with the Rule 120 and eviction proceedings over
which they presided. Second Am. Compl. [#47] at 5,
37. These actions are indisputably judicial in nature.
See Brackhahn v. Eder, No. 13-cv-00141-CMA-KMT, 2013
WL 2394980, at *5 (D. Colo. May 31, 2013) (allegations
arising out of a judge's official duties in handling a
foreclosure action and authorizing a sale constitute judicial
acts normally performed by a judge). Plaintiff's
remaining arguments that judicial immunity does not extend to
state court district judges and that Rule 120 proceedings are
non-judicial are plainly incorrect. See Response
[#75] at 13-14. Additionally, “the doctrine of judicial
immunity now extends to suits against judges where a
plaintiff seeks not only monetary relief, but injunctive
relief as well[, ]” except where “a declaratory
decree was violated or declaratory relief was
unavailable.” Lawrence v. Kuenhold, 271 F.
App'x 763, 766 n.6 (10th Cir. 2008); Brackhahn,
2013 WL 2394980, at *4. Plaintiff does not allege, nor does
it otherwise appear, that a declaratory decree was violated
or that declaratory relief was unavailable to Plaintiff.
Therefore, the Court respectfully recommends
that the individual-capacity claims against Defendant Judges
Caschette, King, and Stevens be dismissed with
prejudice on the basis of judicial immunity. See
Flanders v. ...