Bank of America, N.A. v. Rainbow Bend Homeowners Association
3:15-cv-00291
D. Nev.Aug 23, 2016Background
- Multiple related district-court actions challenge Nevada HOA nonjudicial-foreclosure notice provisions in NRS Chapter 116 as violating due process.
- The Ninth Circuit, in Bourne Valley Court Trust v. Wells Fargo Bank, issued a 2–1 panel decision finding pre-2015 Chapter 116 notice provisions facially unconstitutional on August 12, 2016.
- Bourne Valley’s ruling materially affects the pending cases before this court because they raise the same due-process issue.
- The district court considered whether to stay these actions pending issuance of the Ninth Circuit’s mandate in Bourne Valley.
- The court evaluated stay factors (prejudice to non-moving party; hardship to moving party; judicial economy) and concluded a brief stay is appropriate.
- The court ordered a temporary stay of all proceedings (except service of process) until the Ninth Circuit issues the Bourne Valley mandate; parties may move to lift the stay thereafter.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether to stay district proceedings pending issuance of the Ninth Circuit mandate in Bourne Valley | Stay is unnecessary; parties should proceed | Stay warranted because Bourne Valley likely controls the due-process issue and promotes efficiency | Court sua sponte imposed a temporary stay until mandate issues |
| Whether Bourne Valley affects the due-process claim in these cases | Bourne Valley resolution supports invalidating Chapter 116 notice provisions as applied | Bourne Valley may not be controlling until mandate issues; but it directly bears on claims | Court found Bourne Valley materially impacts the cases and justified a stay |
| Prejudice to non-moving parties from a stay | Plaintiffs would be prejudiced by delay | Any prejudice is minimal given the short, defined stay pending mandate | Court concluded potential prejudice is minimal |
| Judicial economy from staying vs. proceeding | Proceeding avoids delay | Staying avoids duplicative briefing and conserves resources while panel decision becomes final | Court found judicial economy favors a temporary stay |
Key Cases Cited
- Landis v. North American Co., 299 U.S. 248 (U.S. 1936) (district courts have discretionary power to stay proceedings)
- Lockyer v. Mirant Corp., 398 F.3d 1098 (9th Cir. 2005) (district court’s stay authority and discretionary considerations)
- Leyva v. Certified Grocers of California, Ltd., 593 F.2d 857 (9th Cir. 1979) (staying an action pending resolution of related proceedings can be efficient and fair)
- Dependable Highway Exp., Inc. v. Navigators Ins. Co., 498 F.3d 1059 (9th Cir. 2007) (stay factors and standards)
- Rivers v. Walt Disney Co., 980 F. Supp. 1358 (C.D. Cal. 1997) (factors for considering a stay)