United States District Court, D. Hawaii
ORDER REMANDING CASE FOR LACK OF JURISDICTION AND
DENYING DEFENDANTS' MOTION TO DISMISS AS MOOT
C. Kay Sr. United States District Judge
reasons set forth below, the Court finds that it lacks
subject-matter jurisdiction under the Rooker-Feldman
doctrine and accordingly REMANDS this matter to state court.
Defendants' Motion to Dismiss, ECF No. 5, is therefore
DENIED AS MOOT.
April 18, 2017 Plaintiff David Gary Gill
(“Plaintiff”) filed a complaint in state court.
Notice of Removal ¶ 1, ECF No. 1. On August 14, 2017,
Defendants CIT Bank, N.A., fka OneWest Bank, N.A.,
fka OneWest Bank, FSB (“OneWest Bank” or
“OneWest”), and OWB REO LLC (collectively,
“Defendants”) timely removed this case from state
court on the basis of diversity jurisdiction. Id.
alleges that in April 2006 he executed a mortgage in favor of
IndyMac Federal Bank, FSB, to be recorded against his
property as security for his performance under a promissory
note in the amount of $903, 000. Compl. ¶ 16, ECF No.
1-2 (“Compl.”). The mortgage agreement was a
standard-form single family residential mortgage provided by
IndyMac, which was recorded in the State of Hawaii Office of
Assistant Register (“Land Court”) around April
21, 2006. Id. In February 2010, OneWest claimed to
be the mortgagee following assignment from the Federal
Deposit Insurance Corporation after IndyMac was placed in
receivership. Id. ¶¶ 5, 17.
3, 2011, OneWest acted under a power of sale clause in the
mortgage and conveyed the property to OWB REO through a
quitclaim deed, which was recorded on August 1, 2011.
Id. ¶ 19. Plaintiff alleges that either (1) OWB
REO owned the mortgage, and OneWest was acting as its agent
or alter ego, or (2) OWB REO was a nominee, agent, or alter
ego of OneWest. Id. ¶ 8. On August 17, 2011,
OneWest filed a complaint in state district court for summary
possession and ejectment (“Ejectment Action”).
Motion, ECF No. 5 (“Mot.”), Ex. F. The state
court minutes for a September 13, 2011 hearing note that
“confession [was] entered as to possession.”
Mot., Ex. G. The state court then issued a Judgment for and
Writ of Possession on September 23, 2011. Mot., Exs. H-I. On
October 11, 2011, the state court dismissed the case, which
had been continued for a hearing on the status of the damages
claim, as neither party was present. Mot., Ex. G.
31, 2012, OWB REO executed a special warranty deed for the
property to Hawaii Retail Services, LLC, which deed was
recorded on June 20, 2012. Compl. ¶ 21. Hawaii Retail
then executed a warranty deed for the property to Ryno Irwin,
as trustee of the Ryno Irwin Revocable Living Trust
Agreement, on March 21, 2013, which deed was recorded on
April 17, 2013. Id. ¶ 22.
on the foregoing, Plaintiff has alleged two claims here: (1)
quiet title, ejectment, and declaratory relief, and (2)
wrongful foreclosure. Id. ¶¶ 13-59.
Plaintiff claims that the initial sale from OneWest to OWB
REO was improper because OneWest did not strictly comply with
the power of sale requirements. Id. ¶ 23. He
alleges that the notice of acceleration he received was
defective; the notice of intent to foreclose contained an
inadequate description of the property; only a quitclaim deed
was offered; no written notice of the postponed date on which
the property was to be sold was ever published; and the
foreclosure affidavit did not show diligent efforts were used
to secure the best price. Id.
particular, Plaintiff complains that although the foreclosure
sale was advertised in writing for September 8, 2010, the
sale did not take place until May 3, 2011 at a different
location than advertised and no written notice of the change in
date or location was published. Id. ¶¶ 19,
36-38. Plaintiff asserts that the Hawaii Supreme Court held
in Hungate v. Law Office of David B. Rosen, 139 Haw.
394, 391 P.3d 1 (Haw. 2017) that mortgagees were required to
publish notices for postponed auctions under the power of
sale, and therefore claims that the sale here was wrongful
and unlawful. Id. ¶¶ 39-40. As such,
Plaintiff claims entitlement to possession and title, or
alternatively rescissory damages. Id. ¶ 24.
Plaintiff also claims damages under his wrongful foreclosure
claim for lost use and rental value, as well as punitive
damages. Id. ¶¶ 57-58.
filed their Motion to Dismiss on August 21, 2017. Mot., ECF
No. 5. Plaintiff filed his Opposition on October 30, 2017.
ECF No. 18 (“Opp.”). Defendants filed their Reply
on November 6, 2017. ECF No. 19 (“Reply”). On
November 8, 2017, the Court ordered supplemental briefing
regarding whether it had subject-matter jurisdiction under
the Rooker-Feldman doctrine. ECF No. 20. Both
Defendants and Plaintiff filed supplemental memoranda on
November 15, 2017. ECF No. 21 (“Defs. Supp.
Mem.”); ECF No. 22 (“Pl. Supp. Mem.”). Both
parties filed supplemental responses on November 21, 2017.
ECF No. 23 (“Defs. Supp. Resp.”); ECF No. 24
(“Pl. Supp. Resp.”).
Court held a hearing on Defendants' Motion on December 7,
12(b)(6) authorizes the Court to dismiss a complaint that
fails “to state a claim upon which relief can be
granted.” Fed.R.Civ.P. 12(b)(6). Rule 12(b)(6) is read
in conjunction with Rule 8(a), which requires only “a
short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2).
The Court may dismiss a complaint either because it lacks a
cognizable legal theory or because it lacks sufficient
factual allegations to support a cognizable legal theory.
Balistreri v. Pacifica Police Dep't, 901 F.2d
696, 699 (9th Cir. 1988).
resolving a Rule 12(b)(6) motion, the Court must construe the
complaint in the light most favorable to the plaintiff and
accept all well-pleaded factual allegations as true.
Sateriale v. R.J. Reynolds Tobacco Co., 697 F.3d
777, 783 (9th Cir. 2012). The complaint “must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). “The plausibility standard . . . asks for more
than a sheer possibility that a defendant has acted
unlawfully.” Id. “Where a complaint
pleads facts that are ‘merely consistent with' a
defendant's liability, it ‘stops short of the line
between possibility and plausibility of entitlement to
relief.'” Id. (quoting Twombly,
550 U.S. at 557). “In considering a motion to dismiss,
the court is not deciding whether a ...