Williams v. HSBC Bank USA, N.A.
681 F. App'x 693
| 10th Cir. | 2017Background
- In 2004 the Williamses obtained a $126,000 mortgage on their Leavenworth, Kansas home; HSBC later acquired the mortgage.
- The Williamses defaulted in 2012; HSBC obtained a state-court judgment of foreclosure and purchased the property at a 2015 sheriff’s sale; the Williamses were evicted in October 2015.
- In November 2015 the Williamses filed a pro se federal suit (amended) against HSBC and officers alleging seven claims: failure to produce documents, lack of standing, failure to produce the original promissory note, failure to recognize notices (land patent / cease & desist), violations of human rights, and violation of the Homestead Act / UCC.
- They sought return of the home (or compensation) and $3,000,000 in damages.
- Defendants moved to dismiss based on Rooker–Feldman, claim/issue preclusion, and failure to state a claim; the district court dismissed under Rooker–Feldman and preclusion and denied reconsideration.
- The Tenth Circuit affirmed, holding the federal suit impermissibly sought review/rejection of the state-court foreclosure judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Rooker–Feldman bars the suit | Williamses argue federal court can hear claims that defendants lacked standing, failed to produce the original note, and violated rights/UCC—seeking return of home or compensation | HSBC argues the suit attacks the state-court foreclosure judgment and is therefore barred by Rooker–Feldman | Rooker–Feldman bars the action because it seeks review/rejection of the state-court foreclosure judgment |
| Whether damages claims survive Rooker–Feldman | Williamses seek damages as alternative relief if home cannot be returned, based on alleged procedural/legal defects in foreclosure | HSBC argues damages flow from the state foreclosure and thus are also barred | Damages claims barred because they rest on premise that the state judgment was invalid (no fraud alleged) |
| Whether other doctrines (preclusion, failure to state) justify dismissal | Williamses contend their claims are meritorious and rely on various federal/international laws | HSBC invoked claim and issue preclusion and failure-to-state grounds as alternative bases to dismiss | Court did not reach beyond Rooker–Feldman because it disposed of the case on that jurisdictional ground |
| Whether the district court abused its discretion in denying reconsideration | Williamses argued for vacatur/reconsideration of dismissal | Defendants argued dismissal was correct and reconsideration unwarranted | Denial of Rule 59(e) reconsideration affirmed as not an abuse of discretion given Rooker–Feldman ruling |
Key Cases Cited
- Miller v. Deutsche Bank Nat’l Tr. Co., 666 F.3d 1255 (10th Cir. 2012) (Rooker–Feldman standard and review de novo)
- Erickson v. Pardus, 551 U.S. 89 (2007) (pro se filings construed liberally)
- Campbell v. City of Spencer, 682 F.3d 1278 (10th Cir. 2012) (distinguishing permissible federal claims from those that impermissibly review state-court proceedings)
- Vossbrinck v. Accredited Home Lenders, 773 F.3d 423 (2d Cir. 2014) (Rooker–Feldman bars request for title to foreclosed property)
- Crawford v. Countrywide Home Loans, Inc., 647 F.3d 642 (7th Cir. 2011) (Rooker–Feldman bars federal claims challenging foreclosure fairness/effects)
- Taylor v. Fed. Nat’l Mortg. Ass’n, 374 F.3d 529 (7th Cir. 2004) (request to recover home treated as request to vacate state foreclosure judgment and barred)