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Magbual v. Federal National Mortgage Association

United States District Court, D. Hawaii

December 29, 2016

ROGELIO P. MAGBUAL and ZENAIDA D. MAGBUAL, individually, Plaintiffs,
v.
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FANNIE MAE); JOHN DOES 1-50; JANE DOES 1-50; DOE PARTNERSHIPS 1-50; DOE CORPORATIONS 1-50; DOE ENTITIES 1-50; and DOE GOVERNMENTAL UNITS 1-50, Defendants.

          ORDER GRANTING DEFENDANT'S MOTION TO DISMISS (ECF NO. 7) WITH PREJUDICE

          Helen Gillmor, United States District Judge.

         Plaintiffs Rogelio P. Magbual and Zenaida D. Magbual filed a Complaint asserting that the Defendant Federal National Mortgage Association (“Fannie Mae”) wrongfully foreclosed upon their home.

         Defendant Fannie Mae has filed a Motion to Dismiss. Fannie Mae argues that Plaintiffs' Complaint is barred from being litigated in federal court, as Plaintiffs already litigated the issues relating to the foreclosure of their home in the courtsof the State of Hawaii.

         This Court lacks subject-matter jurisdiction, as Plaintiffs' claims are barred by the Rooker-Feldman doctrine. Rooker v. Fidelity Trust Co., 263 U.S. 413, 415-16 (1923); District of Columbia Court of Appeals v. Feldman, 460 U.S. 462, 482-86 (1983). Plaintiff's claims are also precluded by res judicata.

         Defendant Fannie Mae's Motion to Dismiss (ECF No. 7) is GRANTED.

         The Complaint (ECF No. 1) is DISMISSED WITH PREJUDICE.

         PROCEDURAL HISTORY

         On August 3, 2016, Plaintiffs Rogelio P. Magbual and Zenaida D. Magbual (“Plaintiffs”) filed a Complaint. (ECF No. 1).

         On August 30, 2016, Defendant Federal National Mortgage Association (“Fannie Mae”) filed a Motion to Dismiss, entitled DEFENDANT FEDERAL NATIONAL MORTGAGE ASSOCIATION'S MOTION TO DISMISS COMPLAINT FOR UNLAWFUL, ILLEGAL AND WRONGFUL FORECLOSURE AND VIOLATIONS UNDER THE FAIR DEBT COLLECTION PRACTICES ACT U.S.C. SECTION 15 U.S.C. §1692(E) AND ACT 48 PERTAINING MORTGAGE FORECLOSURE, AND VIOLATION OF TRUST AGREEMENT UNDER THE POOLING AND SERVICING AGREEMENT (PSA); HAWAII UNFAIR AND DECEPTIVE BUSINESS PRACTICES ACT: HAW REV. STAT. §480 1 THROUGH 480-24, FILED AUGUST 3, 2016 [Dkt. No. 1]. (ECF No. 7).

         On October 3, 2016, Plaintiffs filed a Motion for Extension of Time pursuant to Federal Rule of Civil Procedure 6. (ECF No. 14).

         On October 3, 2016, the Court filed an Order granting Plaintiffs' motion for extension of time. The Court ordered Plaintiffs to file their Opposition on or before October 21, 2016. (ECF No. 15).

         On October 21, 2016, Plaintiffs filed their Opposition, entitled PLAINTIFFS ROGELIO P. MAGBUAL AND ZENAIDA D. MAGBUAL'S MEMORANDUM IN OPPOSITION TO DEFENDANT'S MOTION TO DISMISS COMPLAINT FOR UNLAWFUL, ILLEGAL AND WRONGFUL FORECLOSURE AND VIOLATIONS UNDER THE FAIR DEBT COLLECTION PRACTICES ACT U.S.C. SECTION 15 U.S.C. § 1692 (e) AND ACT 48 PERTAINING MORTGAGE FORECLOSURE, AND VIOLATION OF TRUST AGREEMENT UNDER THE POOLING AND SERVICING AGREEMENT (PSA). (ECF No. 16).

         On November 4, 2016, Defendant Fannie Mae filed DEFENDANT FEDERAL NATIONAL MORTGAGE ASSOCIATION'S REPLY IN SUPPORT OF ITS MOTION TO DISMISS COMPLAINT FOR UNLAWFUL, ILLEGAL AND WRONGFUL FORECLOSURE AND VIOLATIONS UNDER THE FAIR DEBT COLLECTION PRACTICES ACT U.S.C. SECTION 15 U.S.C. §1692(E) AND ACT 48 PERTAINING MORTGAGE FORECLOSURE, AND VIOLATION OF TRUST AGREEMENT UNDER THE POOLING AND SERVICING AGREEMENT (PSA). (ECF No. 17).

         BACKGROUND

         On October 31, 2007, Plaintiffs Rogelio P. Magbual and Zenaida D. Magbual (“Plaintiffs”) executed a promissory note secured by a mortgage on their home in Wailuku, Hawaii, on the island of Maui. (Complaint at ¶ 2, ECF No. 1; State Court Findings of Fact & Conclusions of Law at ¶ 1, Ex. F of Def. Motion to Dismiss, ECF No. 7-8).

         On October 10, 2012, Nationstar Mortgage LLC (“Nationstar”) instituted judicial foreclosure proceedings against Plaintiffs by filing a complaint in the Circuit Court of the Second Circuit, State of Hawaii. (Ex. B, ECF No. 7-4).

         On January 2, 2014, the state court entered judgment in favor of Nationstar and filed a decree of foreclosure and order of sale. (Ex. G, ECF No. 7-9). Plaintiffs did not appeal the judgment, decree of foreclosure, or order of sale. (State Court Docket, Ex. A, ECF No. 7-1).

         On March 28, 2016, Plaintiffs filed a motion in state court seeking relief from the January 2, 2014 judgment. In their motion, Plaintiffs argued that the foreclosure was void and illegal, as Nationstar was improperly assigned the promissory note and mortgage. (Ex. J, ECF No. 7-12).

         On June 16, 2016, the state court denied Plaintiffs' March 28, 2016 motion. (Ex. K, ECF No. 7-13). On the same date, June 16, 2016, the state court filed an order confirming the sale of the foreclosed home and issued a writ of ejectment. (Exs. L; N, ECF Nos. 7-14; 7-16). The state court also entered a second judgment, also in favor of Nationstar, as to the sale of the foreclosed home and the issuance of the writ of ejectment. (Ex. M, ECF No. 7-15). Plaintiffs did not appeal the second judgment. (State Court Docket, Ex. A).

         On August 3, 2016, Plaintiffs filed the instant federal court Complaint. Plaintiffs seek to nullify the foreclosure and sale of their home. Plaintiffs' position is difficult to understand, but appears to be that Defendant Federal National Mortgage Association (Fannie Mae”) was not a true holder of the mortgage note or the mortgage, and so the foreclosure was invalid. (ECF No. 1). The federal court Complaint also alleges that Fannie Mae's conduct violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq., and the Hawaii Unfair or Deceptive Acts and Practices statute, Haw. Rev. Stat. § 480-1 et seq.

         STANDARD OF REVIEW

         Dismissal Pursuant to the Rook ...


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