Deandre Russell v. Redstone Federal Credit Union, 710 F. App'x 830

Background

Deandre Russell, proceeding pro se and in forma pauperis, appealed the sua sponte dismissal of his complaint raising FDCPA, TILA, fraud, breach of fiduciary duty, negligence, and § 1983 (due process) claims.
The district court dismissed federal claims as barred by res judicata based on a prior bankruptcy case that produced a final default judgment against Russell involving the same parties and operative facts.
Russell alleged fraud on the court in the prior bankruptcy proceedings and asserted constitutional violations against private parties (his former attorneys and trustees).
The district court also declined supplemental jurisdiction over Russell’s state-law claims after dismissing all federal claims.
The Eleventh Circuit reviewed the res judicata dismissal de novo and evaluated whether Russell sufficiently pleaded fraud on the court and state action for § 1983 purposes.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Russell’s federal claims are barred by res judicata	Prior bankruptcy judgment did not preclude relitigation; fraud on the court excuses preclusion	Prior bankruptcy produced a final judgment on the same cause of action between identical parties	Affirmed: res judicata bars the federal claims arising from the same nucleus of operative fact
Whether Russell pleaded fraud on the court to avoid preclusion	Russell alleged fraud but mostly pleaded conclusions and information-and-belief assertions	Appellees argued Russell failed to allege clear, convincing, probative facts showing fraud on the court	Held: Russell failed to allege fraud on the court with the required clear-and-convincing factual detail
Whether § 1983/due-process claims against private parties state a claim (state-action)	Russell claimed constitutional deprivations stemming from the prior bankruptcy process	Defendants argued they are private actors and not state actors for § 1983 purposes	Held: Dismissed—defendants are private parties; Russell failed to show state action, so § 1983/due-process claims fail
Whether the court should exercise supplemental jurisdiction over state-law claims	Russell sought to pursue state-law claims (fraud, negligence, breach) tied to same facts	Defendants argued dismissal of federal claims eliminates original jurisdiction, so supplemental jurisdiction should be declined	Held: District court properly declined supplemental jurisdiction after dismissing all original federal claims

Key Cases Cited

Ragsdale v. Rubbermaid, Inc., 193 F.3d 1235 (11th Cir. 1999) (standard of review for legal determinations like res judicata is de novo)
United States v. Fort, 638 F.3d 1334 (11th Cir. 2011) (appellate court may affirm on any ground supported by the record)
Merrell Dow Pharm. v. Thompson, 478 U.S. 804 (1986) (when a claim "arises under" federal law for § 1331 jurisdiction)
Chapman v. Houston Welfare Rights Org., 441 U.S. 600 (1979) (§ 1983 failure defeats § 1343 and may defeat general federal-question jurisdiction)
Citibank, N.A. v. Data Lease Fin. Corp., 904 F.2d 1498 (11th Cir. 1990) (elements and "same nucleus of operative fact" test for res judicata)
Riley v. Camp, 130 F.3d 958 (11th Cir. 1997) (Fifth Amendment due process applies only to federal officials)
United States v. Price, 383 U.S. 787 (1966) (Fourteenth Amendment restricts claims to state action)
Rayburn ex rel. Rayburn v. Hogue, 241 F.3d 1341 (11th Cir. 2001) (standards for finding private parties to be state actors)
Davenport Recycling Assocs. v. Commissioner, 220 F.3d 1255 (11th Cir. 2000) (fraud on the court requires an unconscionable scheme to influence the court)
Rozier v. Ford Motor Co., 573 F.2d 1332 (5th Cir. 1978) (only the most egregious misconduct constitutes fraud on the court)
Booker v. Dugger, 825 F.2d 281 (11th Cir. 1987) (fraud on the court requires clear-and-convincing, probative factual allegations)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility standard for pleadings under § 1915(e)(2)(B) and Rule 8)