Robert Horowitz v. Continental Casualty Company
681 F. App'x 198
| 4th Cir. | 2017Background
- Plaintiffs Robert and Cathy Horowitz sued three law firms and a malpractice insurer, alleging a conspiracy to induce them into an illegal settlement in a prior Maryland malpractice action.
- A Maryland state court (and the Court of Special Appeals of Maryland later) entered judgment adverse to the Horowitzes concerning the legality of that settlement.
- The Horowitzes filed this federal suit seeking to void the state-court judgment and asserting claims under the FDCPA, Maryland consumer protection/debt-collection statutes, § 1983, and related theories.
- Defendants moved to dismiss; the district court dismissed the complaint, invoking Rooker–Feldman, res judicata/collateral estoppel, and failure to state viable statutory or § 1983 claims.
- The Horowitzes appealed; the Fourth Circuit affirmed the dismissal and denial of leave to amend or stay.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether federal court may void prior state-court judgment | Horowitz: federal court should declare the state judgment void | Defendants: Rooker–Feldman bars federal review of final state-court judgments | Court: Rooker–Feldman precludes review; request denied |
| Whether claims relitigate legality of settlement (res judicata / collateral estoppel) | Horowitz: claims challenge settlement legality and are permitted | Defendants: prior state litigation decided this issue; preclusion applies | Court: preclusion bars all claims premised on settlement illegality |
| Whether complaint states FDCPA / MCDCA claims against insurer and law firm | Horowitz: defendants acted as debt collectors and sought enforcement of non-existent rights | Defendants: plaintiffs failed to plead debt-collector status or that defendants attempted to enforce a non-existent right | Court: allegations were conclusory; plaintiffs admitted indebtedness; claims dismissed for failure to state a claim |
| Whether § 1983 claim adequately alleges state action / constitutional deprivation | Horowitz: sheriff’s deputy involvement and enforcement threats convert private conduct into state action | Defendants: conduct was lawful notice/enforcement of judgment, not a constitutional deprivation or state-caused wrong | Court: conduct did not amount to state-action constitutional deprivation; § 1983 claim dismissed |
Key Cases Cited
- Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923) (federal courts lack appellate jurisdiction over state-court judgments)
- District of Columbia Court of Appeals v. Feldman, 460 U.S. 462 (1983) (clarifies limits of lower federal court review of state judicial decisions)
- Lance v. Dennis, 546 U.S. 459 (2006) (per curiam) (reaffirms Rooker–Feldman scope)
- Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280 (2005) (describes Rooker–Feldman application to state-court losers seeking federal review)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must state plausible claim to survive dismissal)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (conclusory allegations insufficient under Rule 12(b)(6))
- Thana v. Board of License Commissioners for Charles County, Md., 827 F.3d 314 (4th Cir. 2016) (discusses Rooker–Feldman in Fourth Circuit)
- Lugar v. Edmondson Oil Co., 457 U.S. 922 (1982) (tests for attributing private conduct to the state for § 1983 purposes)
- Jackson v. Pantazes, 810 F.2d 426 (4th Cir. 1987) (private party/public official joint action satisfies state-action inquiry)