Spencer v. Federal Home Loan Mortgage Corp., 246 F. Supp. 3d 1241

Debtor Sheila M. Spencer filed a Chapter 13 petition on April 3, 2015; PNC Bank moved for relief from the automatic stay on April 16, 2015.
Bankruptcy Court held an evidentiary hearing and found Spencer engaged in a scheme to delay creditors, granting relief from stay under 11 U.S.C. § 362(d).
Spencer filed an adversary complaint seeking to nullify the mortgage and challenge PNC’s rights; the bankruptcy court sua sponte ordered briefing on Rooker–Feldman and then dismissed for lack of subject-matter jurisdiction.
At a June 30, 2015 hearing Spencer’s counsel agreed to deadlines (plan amendment and tax-return declaration) and was warned that failure to comply would result in dismissal; the court entered a written order requiring filing by July 13, 2015.
Spencer failed to file the plan amendment or the tax-return declaration by the deadline; the trustee submitted a proposed dismissal and the bankruptcy court dismissed the Chapter 13 case under 11 U.S.C. § 1307(c).
Spencer appealed three rulings to the district court: lifting the automatic stay, dismissal of the adversary proceeding, and dismissal of the Chapter 13 petition; the district court affirmed all three rulings.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the bankruptcy court abused its discretion in lifting the automatic stay	Spencer argued relief was unwarranted and property necessary for reorganization	PNC argued Spencer failed to show adequate protection or that property was necessary for reorganization	Affirmed — stay lifted under 11 U.S.C. § 362(d) because Spencer did not show adequate protection or necessity for effective reorganization
Whether the adversary complaint challenging the foreclosure judgment could proceed in bankruptcy court	Spencer sought to challenge PNC’s standing and asked court to set aside state foreclosure judgment	PNC argued Rooker–Feldman bars federal review of a state-court judgment	Affirmed dismissal — Rooker–Feldman deprived the bankruptcy court of jurisdiction to review the state foreclosure judgment
Whether dismissal of Spencer’s Chapter 13 petition for failure to meet a court-ordered deadline was appropriate	Spencer (through counsel) argued failure to file timely was inadvertent and sought relief from dismissal	Trustee and bankruptcy court argued dismissal was proper for unreasonable delay, failure to file plan amendment, and failure to supply required documents under § 521(a); Spencer had been warned on the record	Affirmed dismissal — bankruptcy court acted within § 1307(c) and its inherent authority; counsel’s excuses did not amount to excusable neglect

Rooker v. Fidelity Trust Co., 263 U.S. 413 (federal courts lack jurisdiction to review state-court judgments)
District of Columbia Court of Appeals v. Feldman, 460 U.S. 462 (federal courts cannot act as appellate courts over state court decisions)
Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280 (definition and scope of Rooker–Feldman doctrine)
Brown v. Bowman, 668 F.3d 437 (7th Cir.) (only the U.S. Supreme Court may review state court judgments)
Crawford v. Countrywide Home Loans, Inc., 647 F.3d 642 (7th Cir.) (distinguishing independent federal claims from impermissible state-judgment review)
Taylor v. Federal Nat. Mortg. Ass’n, 374 F.3d 529 (7th Cir.) (claims attacking foreclosure as fraud on the court are barred by Rooker–Feldman when they seek to set aside state judgment)
Levin v. Attorney Registration & Disciplinary Comm’n of the Supreme Court of Ill., 74 F.3d 763 (7th Cir.) (claims need not have been raised in state court to be barred by Rooker–Feldman)
Mains v. Citibank N.A., 852 F.3d 669 (7th Cir.) (affirming dismissal of federal actions that impermissibly challenge state foreclosure judgments)