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Seber v. Bank of America

United States District Court, D. Utah, Northern Division

August 4, 2017

BANK OF AMERICA, N.A., f/k/a COUNTRYWIDE HOME LOANS, INC., et al., Defendants.

          Brooke C. Wells Magistrate Judge



         This case was referred to Magistrate Judge Brooke C. Wells pursuant to 28 U.S.C. § 636(b)(1)(B). Before the court is the Magistrate Judge's Report and Recommendation, which addresses Defendant Skyline Holding Group LLC's Motion to Dismiss[1] and BOA Defendants'[2]Motion to Dismiss, [3] along with several motions pertaining to Plaintiffs' ability to file a second amended complaint.[4]

         In their First Amended Complaint, pro se Plaintiffs Marty and Mable Seber set forth several causes of action[5] originating from a loan Plaintiffs obtained in June 2004 to purchase property at 214 North Dam Road, Mantua, Utah.[6] Since 2009, Plaintiffs have been involved in seven lawsuits related to the 214 North Dam Road property, four in state court[7] and three (including the present case) in federal court.[8] Plaintiffs initiated five of these lawsuits.

         In this case, Plaintiff allege various Defendants failed to make disclosures required under the Truth-in-Lending Act, inflated Plaintiffs' monthly income, forged Plaintiffs' signatures and initials, improperly endorsed the Deed of Trust, and illegally foreclosed on the 214 North Dam Road property.[9] Plaintiffs also claim an unlawful detainer action order issued subsequent to the trustee sale is void.[10]

         In their Motions to Dismiss, Defendants argue Plaintiffs' claims are barred by res judicata-claim preclusion.[11] Defendants argue the three elements of claim preclusion are satisfied here because (1) there was final judgment on the merits of Plaintiffs' claims in previously adjudicated actions filed by Plaintiffs; (2) all parties to this action are identical or in privity with the parties in the previous actions; and (3) Plaintiffs' claims asserted here were either previously raised or could have been raised as they arise from the same events.

         In response, Plaintiffs argue claim preclusion should not apply “due to newly discovered information, factual allegations, evidence and several new causes of action.”[12] Specifically, Plaintiffs argue that their Complaint “present[s] a new core issue and prove[s] that the instruments utilized to foreclose on the Plaintiffs' home are Void by operation of law.”[13]

         In her Report and Recommendation, the Magistrate Judge concluded the elements of claim preclusion were met and recommended this court grant Defendants' Motions to Dismiss, and dismiss the case with prejudice on res judicata grounds. She also recommended this court deny Plaintiffs' Motion to Amend based on futility, and deny pending discovery motions as moot.[14]

         Plaintiffs filed a timely Objection to the Magistrate Judge's Report and Recommendation.[15] The court, therefore, reviews those portions of the Report and Recommendation to which Plaintiffs objected de novo.[16] In their Objection, Plaintiffs argue generally that when “one analyses the complaints and compares the facts, issues, matters and causes of action, it is not difficult to ascertain that there are several clear distinctions between the current and prior complaints.”[17] Plaintiffs point to “the fact that the Assignment of Deed of Trust was a VOID act and set off a series of events which are/were subsequently VOID.”[18]

         In effect, Plaintiffs object to the Magistrate Judge's determination that there is identity of the causes of action in both suits. After conducting a de novo review of this issue, the court concludes the Report and Recommendation correctly rejected this argument. As discussed in the Recommendation, the Tenth Circuit “employs a transactional approach in which ‘a final judgment extinguishes all rights of the plaintiff to remedies against the defendant with respect to all or any part of the transaction, or series of connected transactions, out of which the action arose.'”[19]

         Here, Plaintiffs do not explain why the alleged new facts and evidence did not arise out of the same transaction that was the subject of their previous actions (the 2004 loan); nor do they explain why they could not have litigated this specific issue in their previous actions. As Defendants detail in their Reply to Plaintiffs' Objection, Plaintiffs do not allege any facts that occurred after Plaintiffs' third prior action was filed in November 1, 2013.[20] Also, Plaintiffs' position is undermined by their Complaint which states, “[p]etitioners have challenged the VOID orders in state court but were thwarted by an inhospitable court ‘system' bent on continuing foreclosure business as usual.”[21] Further, Plaintiffs made this same argument to the Magistrate Judge who rejected it.[22] After de novo review, the court concludes the Magistrate Judge correctly decided there was identity of causes of action.

         In their Objection, Plaintiffs do not discuss the other two-prongs of claim preclusion, namely whether there was a final judgment on the merits in the earlier actions or whether there is identity of parties or privies in the two suits. Plaintiffs also do not address the Magistrate Judge's conclusion that their Motion to Amend the Complaint should be dismissed based on futility. The court, therefore, reviews these portions of the Report and Recommendation under a “clearly erroneous” standard of review.[23] Under this standard, the court “will affirm the Magistrate Judge's ruling unless [the court] . . . is left with the definite and firm conviction that a mistake has been committed.”[24] After reviewing the briefing, record, and relevant legal authorities, the court concludes that the Magistrate Judge did not clearly err in her analysis on these issues.

         The court, therefore, OVERRULES the Objection and ADOPTS the Report and Recommendation in whole. Defendants' Motions to Dismiss, dkt. 5, dkt. 19, are GRANTED and the case is dismissed with prejudice on res judicata grounds. Further, Plaintiffs' Motion to Amend the Complaint, dkt. 18, is DENIED based on futility. Finally, all other pending motions are DENIED as moot.

         SO ...

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