560 B.R. 630
D. Conn.2016Background
- Wells Fargo obtained a Connecticut state-court foreclosure judgment against Frances Barretta for $270,014.60 after summary judgment and entered final judgment on December 22, 2014.
- Barretta filed a Chapter 13 bankruptcy petition on May 7, 2015, which converted to Chapter 7 on August 31, 2015.
- Wells Fargo moved for relief from the automatic stay in bankruptcy; the Bankruptcy Court granted relief on November 18, 2015.
- Barretta opposed relief from stay in bankruptcy arguing a factual dispute over the note holder/servicer and Wells Fargo’s standing, a claim she had previously raised unsuccessfully in state court.
- District court analyzed Barretta’s motion for a stay pending appeal of the Bankruptcy Court’s relief-from-stay order and denied the motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a stay pending appeal should issue | Barretta: there is a factual dispute over who holds/serves the note (lack of standing) | Wells Fargo: state-court foreclosure judgment resolved standing; Rooker–Feldman bars relitigation in federal court | Denied — Barretta failed to show likelihood of success; Rooker–Feldman precludes the claim |
| Whether Barretta is likely to succeed on the merits | Barretta: appellate review should reach the standing/notice issues | Wells Fargo: state judgment forecloses those issues; federal courts must abstain | Court: no likelihood of success; claim is effectively an impermissible attack on state judgment |
| Whether Barretta will suffer irreparable harm without a stay | Barretta: loss of her home constitutes irreparable harm | Wells Fargo: continued delay would harm plaintiff (loss of property value/taxes) | Court: irreparable harm exists for Barretta but is outweighed by other factors |
| Balance of harms and public interest | Barretta: home loss favors stay | Wells Fargo: prejudice from prolonged delay and costs | Court: harms to Wells Fargo and lack of meritorious appeal outweigh Barretta; public interest neutral |
Key Cases Cited
- Hilton v. Braunskill, 481 U.S. 770 (U.S. 1987) (stay pending appeal factors)
- In re World Trade Ctr. Disaster Site Litig., 503 F.3d 167 (2d Cir. 2007) (articulating stay factors)
- Thapa v. Gonzales, 460 F.3d 323 (2d Cir. 2006) (sliding-scale approach to stay factors)
- McKithen v. Brown, 626 F.3d 143 (2d Cir. 2010) (elements of Rooker–Feldman)
- Vossbrinck v. Accredited Home Lenders, Inc., 773 F.3d 423 (2d Cir. 2014) (Rooker–Feldman bars federal attack on state foreclosure judgment)
- Johnson v. De Grandy, 512 U.S. 997 (U.S. 1994) (federal courts cannot act as appellate courts over state judgments)