Appellate Circuit
Foreclosure Mill Fraud: Co-Founder Disbarred for Theft of Millions of Dollars but Faces No Criminal Charges
Ocwen also filed a proof of claim, alleging that more than $2 million of its funds, which should have been deposited in an IOLTA account, had been misappropriated.
Supreme Judicial Court of Massachusetts
IN THE MATTER OF STEVEN A. ABLITT
Docket: SJC-12929
Dates: February 3, 2021
REPUBLISHED BY LIT: MAR. 20, 2022
Steven Ablitt Opposed Disbarment. He Lost.
The respondent attorney, Steven A. Ablitt, appeals from the judgment of a single justice of this court disbarring him from the practice of law.[1] He claims both that the findings of misconduct are not supported by substantial evidence and that his due process rights were violated in the disciplinary proceedings. We affirm.
1. Background.
On September 6, 2016, bar counsel filed a two-count petition for discipline against the respondent and his former law partner, Lawrence F. Scofield, arising out of their default services law practice, Ablitt Scofield, P.C.[2]
At one time, the firm had offices in Massachusetts, Florida, and Puerto Rico; until it was restructured in 2013, Ablitt owned ninety-nine shares of the firm, while Scofield owned the remaining share.[3]
Ablitt also owned, or held interests in, several ancillary businesses, some of which provided services to the firm.
Because of the nature of its practice, the firm customarily advanced certain fees for the benefit of its lender clients for expenses such as filing fees, title searches, and auctions.
Over time, and particularly after U.S. Bank Nat’l Ass’n v. Ibanez, 458 Mass. 637, 655 (2011) (Ibanez) (foreclosure action may not be commenced where lender not in possession of promissory note), those cash advances, combined with poor billing and collection practices, created a financial burden for the firm, and client funds on deposit in an Interest on Lawyers’ Trust Account (IOLTA or IOLTA account) were used to pay the firm’s operating expenses.
As amended, count one of the petition for discipline charged that the respondent was responsible for intentional misuse of client funds, failed as a partner in the firm to supervise the firm’s financial and accounting personnel, and failed to maintain required IOLTA account records.
Count two charged that the respondent engaged in misrepresentation, disclosed confidential client information, and was involved in a conflict of interest in connection with a factoring agreement the firm used to finance its accounts receivable.
A hearing committee of the Board of Bar Overseers (board) held a public hearing, at which the respondent was represented by counsel.
Over the course of thirteen days, fifteen witnesses, including the respondent and Scofield, testified, and 283 exhibits were admitted in evidence. After the hearing, on the respondent’s motion, the evidence was reopened and there was an additional day of testimony.
Thereafter, the hearing committee issued a report, determined that bar counsel had proved the allegations of misconduct, and recommended that the respondent be disbarred.
The board adopted the committee’s findings, conclusions, and recommendations, and voted to recommend that the respondent be disbarred.
An information was filed in the county court pursuant to S.J.C. Rule 4:01, § 8 (6), as appearing in 453 Mass. 1310 (2009).
A single justice of this court reviewed the record and, after a hearing, accepted the hearing committee’s role as the “sole judge of the credibility of the testimony presented at the hearing.” S.J.C. Rule 4:01, § 8 (5) (a). She concluded that the findings were supported by substantial evidence. See S.J.C. Rule 4:01, § 8 (6).
The single justice accepted the board’s recommendation as to sanction, and a judgment of disbarment entered.
2. Disciplinary violations.
We summarize the hearing committee’s subsidiary findings, as adopted by the board and, like the single justice, conclude that the findings are supported by substantial evidence.[4] See S.J.C. Rule 4:01, § 8 (6). Its ultimate “findings . . . , as adopted by the board, are entitled to deference, although they are not binding on this court.” Matter of Ellis, 457 Mass. 413, 415 (2010). See Matter of Strauss, 479 Mass. 294, 296 (2018).
a. Count one: intentional misuse of client funds, failure to supervise, and failure to maintain records.
By 2010, the firm’s operating account had been depleted. Faced with mounting financial pressures, the respondent authorized the firm’s accounting department to withhold payments to certain vendors. His partner, Scofield, learned that the firm’s chief financial officer, Alfred Moss, was misusing IOLTA funds to pay operating expenses, and reprimanded him.
In December 2010, on the respondent’s recommendation, Robert Feige was hired as a financial consultant.
By the beginning of 2011, however, the firm owed millions of dollars to its vendors.
Between October 2010 and March 2011, the firm opened several new IOLTA accounts and an operating account.
The respondent and Scofield were the only signatories to those accounts.
Nonetheless, Moss continued to misuse IOLTA funds to pay firm expenses, and his employment was terminated in February 2011.
Soon thereafter, Feige became the firm’s chief financial officer.
Feige reported to both the respondent and Scofield that “a pretty big number” had been misappropriated from the firm’s IOLTA accounts.
The respondent and Scofield adopted Feige’s recommendation to replenish the IOLTA funds from new client trust funds received on behalf of other clients and, over time, from the firm’s profits.
Beginning in February 2011, Feige provided the respondent with weekly summaries of the firm’s finances, showing that the firm’s accounts payable exceeded its accounts receivable.
In addition, the respondent required that Feige and other accounting personnel report directly to him, and instructed that he be involved in meetings with creditors, lenders, and vendors.
Rogue Foreclosure Mill Lawyer Nat Hardwick Went to Jail. Why Not Ablitt, et al?
The firm’s financial condition continued to deteriorate, particularly after the court’s decision in Ibanez, 458 Mass. at 655.
Various of the firm’s lender clients froze foreclosure litigation, and for the next five or six months, the firm had no new foreclosure work. Because it continued to incur operating expenses, however, it began operating at a loss.
The firm’s debts to vendors, including the respondent’s ancillary businesses, escalated, and the accounting department began using the firm’s credit cards to “buy extra time” to cover payroll and other expenses.
In August 2011, five checks drawn on the IOLTA accounts were returned for insufficient funds.
As a result, bar counsel opened an investigation.
By that time, the respondent, Scofield, Feige, and Mary Donovan, a member of the firm’s accounting staff, had met to review the firm’s financial records.
The respondent retained legal ethics counsel to assist in responding to bar counsel’s inquiry.
Ethics counsel taught Donovan how to perform the three-way reconciliation required by Mass. R. Prof. C. 1.15, as appearing in 471 Mass. 1380 (2015).[5]
Given that there were insufficient funds in the IOLTA accounts to reconcile them, however, a false set of records was created and submitted to bar counsel.
Although, based on the false records, bar counsel closed its investigation in May 2012, she emphasized to the respondent that the lawyers must comply with their professional obligations under Mass. R. Prof. C. 1.15.
Despite the warning, the respondent took no steps to comply with that obligation.
No later than the fall of 2011, the respondent was aware of both Moss’s and Feige’s misuse of IOLTA funds.
By November 2011, funds transferred from the firm’s IOLTA accounts were being used to pay credit card bills, as well as other operational expenses.
In August 2012, a check for $370,000 drawn on one of the firm’s IOLTA accounts was returned for insufficient funds.
Bar counsel opened a second investigation.
That investigation subsequently was closed based on what the hearing committee determined were false statements by Feige to bar counsel.
In November 2012, the firm began receiving funds on behalf of a client, Ocwen Loan Servicing LLC (Ocwen), and by May 2013, it had received more than $2 million.
By May 24, 2013, however, the balance of the IOLTA account was less than $188,000, although no payments to Ocwen had been made, and notice had not been given to Ocwen that the funds were withdrawn to pay firm fees.
Between February 11, 2013, and May 22, 2013, the firm’s records indicated that approximately $591,000 was transferred from this IOLTA account to the firm’s operating account.
In 2013, the firm added three new partners to its practice: John Connolly, Jr.; Kevin Geaney; and Rachelle Willard.
At the time, the firm was interested in regaining approval to handle Federal National Mortgage Association (Fannie Mae) loans, which had been lost years earlier.
It considered restructuring to give Fannie Mae the impression that the respondent was no longer managing the firm.
In May 2013, Connolly told Fannie Mae that the firm was under new management, although the respondent retained management authority.
In August 2013, Geaney learned that there were insufficient funds in the IOLTA account to cover a check Willard had requested, and that approximately $3 million was missing from the account.
At a meeting attended by the respondent, Scofield, Connolly, Geaney, and Willard, the lawyers were informed that, acting on the instruction of Feige, IOLTA funds had been used to cover firm operational expenses. Options, including terminating Feige’s employment, were discussed.
Although the respondent testified that he favored firing Feige, the hearing committee credited contrary testimony from other firm lawyers and employees.
The Fraudulent Transfers of Over $1M detailed in this Bankruptcy Proceeding
Grossman v. Durham Commercial Capital Corp., 614 B.R. 133 (B.A.P. 1st Cir. 2020)
In October 2013, a firm restructuring agreement and a consulting agreement were signed, listing May 16, 2013, as the effective date.
Notwithstanding the respondent’s position that, after May 16, 2013, he lacked management responsibility for the firm — in light of the restructuring agreement, his purported resignation, and the consulting agreement — the substantial evidence supports the hearing committee’s conclusion that he retained that responsibility. Regardless of their purported effective date, the documents were signed in October 2013, months after Fiege’s misconduct was discussed at the August meeting.
The substantial evidence also supports the hearing committee’s finding that the changes were largely illusory, designed in part to fool Fannie Mae into approving the firm to handle its business.
On September 3, 2014, the respondent filed a Chapter 7 involuntary bankruptcy petition against the firm, listing himself and his ancillary businesses as creditors.
Ocwen also filed a proof of claim, alleging that more than $2 million of its funds, which should have been deposited in an IOLTA account, had been misappropriated.
As the hearing committee found, and the board agreed, the respondent had a “hands-on approach” to the firm’s financial affairs and was well aware of its declining financial viability. Not only did he have a substantial ownership interest in the firm itself, but he also had ownership interests in ancillary businesses that received payments from it.
He recommended hiring Feige to improve its financial condition.
The hearing committee concluded that by failing to terminate Feige’s employment after the misconduct was discovered, the respondent ratified Feige’s misappropriation of client funds.
In addition, the hearing committee found, and the board agreed, that by collecting salary payments from the firm and ancillary businesses during the period that the respondent was aware of the misuse of IOLTA funds to pay operating expenses, the respondent benefited from the misuse.
The hearing committee found, and the board accepted, that not only was the respondent willfully blind to the misuse of client funds, but he also had actual knowledge of the misuse, and was personally responsible, pursuant to Mass. R. Prof. C. 5.3 (c), as appearing in 471 Mass. 1447 (2015), because he ratified Feige’s actions and failed to mitigate them.
See Matter of Zimmerman, 17 Mass. Att’y Discipline Rep. 633 (2001), quoting C.W. Wolfram, Modern Legal Ethics § 13.3.3, at 696 (1986)
(“[A] lawyer cannot avoid ‘knowing’ a fact by purposefully refusing to look. While a lawyer ‘is not under an obligation to seek out information,’ his or her ‘studied ignorance of a readily accessible fact by consciously avoiding it is the functional equivalent of knowledge of the fact'”).
By failing to adopt procedures sufficient to ensure that the conduct of nonlawyer staff was compatible with the respondent’s professional obligations, by failing to ensure that the conduct of nonlawyer staff under his supervision adhered to those professional obligations, and by ratifying the misconduct of nonlawyers, the respondent violated Mass. R. Prof. C. 5.3 (responsibilities regarding nonlawyer assistance) and Mass. R. Prof. C. 8.4 (c), as appearing in 471 Mass. 1483 (2015) (dishonesty, fraud, deceit, or misrepresentation).
By failing to maintain individual client ledgers, failing to perform and retain a three-way reconciliation of IOLTA accounts, and failing to ensure that only client trust funds were deposited into IOLTA accounts, the respondent violated Mass. R. Prof. C. 1.15 (b) (segregation of trust funds) and Mass. R. Prof. C. 1.15 (f) (1) (trust account documentation). By failing to keep clients reasonably informed about their cases, the respondent violated Mass. R. Prof. C. 1.4, as appearing in 471 Mass. 1319 (2015) (communication with clients).
b. Count two: fee factoring agreement.
The petition’s second count alleged that the respondent made knowing misrepresentations to a “factoring” company, Durham Commercial Capital Corp. (Durham), to the effect that the firm was financially solvent, for the purpose of inducing Durham to loan money to the firm.
The agreement granted Durham a security interest in the firm’s accounts receivable, notwithstanding that the firm previously had granted another creditor a security interest in the same assets.
Although the respondent testified that he believed, at the time he signed the agreement, that the firm was solvent, there is substantial evidence to support the hearing committee’s finding, adopted by the board, that the respondent was aware, as of October 2012, that the firm was unable to meet its payroll or other debts.
The firm did not comply fully with the factoring agreement.
In February 2013, the respondent assigned several clients (including Ocwen) to Durham, notwithstanding a provision in the firm’s contract with Ocwen that prohibited nonconsensual assignments.
Certain client invoices, provided by the respondent to Durham, disclosed the subject of the firm’s representation.
In addition, beginning in November 2013, the respondent asked another client to send payments directly to a bank account in Puerto Rico controlled by the respondent, rather than directly to Durham, as the factoring agreement required.
The hearing committee did not credit the respondent’s claim that the payments made to the Puerto Rico account were for the benefit of the firm’s “stand alone” Puerto Rico office, and therefore were not covered by the factoring agreement.
By disclosing confidential client information to Durham, without the clients’ consent, the respondent violated Mass. R. Prof. C. 1.6 (a), as amended, 474 Mass. 1301 (2016) (confidentiality of information).
In addition, by failing to obtain his clients’ informed consent prior to entering into the factoring agreement, the respondent materially limited his ability to represent his clients, both because he was motivated by his own interests and because the factoring agreement created obligations to Durham, in violation of Mass. R. Prof. C. 1.7 (b), as appearing in 471 Mass. 1335 (2015) (conflict of interest).
By using clients’ confidential information to their disadvantage and his own advantage, the respondent violated Mass. R. Prof. C. 1.8 (b), as appearing in 471 Mass. 1349 (2015) (conflict of interest).
Finally, by misrepresenting to Durham that the firm was solvent and that it was paying its debts in a timely manner, the respondent violated Mass. R. Prof. C. 8.4 (c) (misconduct involving dishonesty, fraud, deceit, or misrepresentation).
3. Due process claim.
In addition to challenging the sufficiency of the evidence of misconduct, the respondent contends that the proceedings before the board did not comport with due process considerations, a claim we also reject.
Stripped of hyperbole, the gravamen of the respondent’s complaint is that bar counsel’s investigation was “designed to prove [her] initial conclusion” that the respondent was solely responsible for the demise of the firm of which he owned ninety-nine of its one hundred shares, and that the investigation was deficient because, among other things, bar counsel “had not reviewed or even sought a substantial portion of [the law firm’s] files.”
In the respondent’s view, “the only way to mount a defense to the [petition for discipline]” was to obtain “access to all” such files. On appeal, he also contends that the single justice’s memorandum of decision failed adequately to address his claim.[6]
The respondent principally complains that the board’s chair improperly denied his request for prehearing discovery subpoenas for a broad swath of e-mail messages and documents held by
(1) the trustee in the firm’s bankruptcy proceeding,
(2) seven individuals who worked at or with the law firm,
and
(3) three corporate entities.
The respondent contends that, as a result of the ruling, he had access to only a “small” portion of documents and communications (including e-mail messages) relating to the now-defunct law firm, i.e., the documents obtained by bar counsel.
There is no dispute, however, that bar counsel opened her files to the respondent (with the exception of her work product), or that the respondent had access to the same documents as bar counsel.
Nor did the respondent demonstrate that the procedure established by the rules — which permits hearing subpoenas for witnesses and documents — prejudiced his defense.
See Rules of the Board of Bar Overseers § 4.9(a)(2) (2017).[7]
As the board’s chair concluded, the respondent failed to demonstrate “substantial need” as required by the rule.
Taking into account that “the information sought or its substantial equivalent has been provided or was available by other means, [and] taking into consideration the formal or informal discovery that has already occurred,” id., the board’s chair denied the applications.
The respondent was permitted to — and did — subpoena witnesses to the hearing, and he examined them there.
No witnesses were excluded.
One of the witnesses produced 3,400 pages of e-mail printouts and delivered them to respondent’s counsel on May 25, 2017, more than two months prior to the conclusion of the hearing.[8]
There was no claim that bar counsel withheld documents from the respondent.
See Matter of the Discipline of an Attorney, 449 Mass. 1001, 1003 (2007) (bar counsel did not withhold documents she did not possess; no denial of due process).
Rather, both bar counsel and the respondent had access to the “full email file [of] Robert Feige, the partial email files of [the respondent] and [a]ttorneys John Connolly and Kevin Geaney” and “a sampling of the operational, financial, and, significantly, IOLTA account establishment records and documents of the [f]irm during the relevant time period.”
Although the respondent contends that he did not have all firm e-mail, he failed to demonstrate how the purportedly missing e-mail could have aided his defense.
The respondent did not, in short, establish that his ability to present an effective defense was impeded by the denial of the requested prehearing discovery.
Bar counsel is not obliged to participate in what amounts to a prehearing fishing expedition for evidence that might prove exculpatory.
See Matter of Abbott, 437 Mass. 384, 392 (2002); Matter of London, 427 Mass. 477, 481-482 (1998) (failure to interview respondent’s witness does not violate of due process).
While we recognize that there might be circumstances in which the denial of prehearing discovery may be so prejudicial as to amount to a due process violation, see Matter of Tobin, 417 Mass. 81, 87 (1994), those circumstances are not present here, see Matter of McDonald, 18 Mass. Att’y Discipline Rep. 382 (2002).
Among other things, the hearing committee granted the respondent’s request to reopen the hearing, after he had had ample opportunity to review all documents, and the only witness he called was himself.
Steven Ablitt Operated a Foreclosure Mill Office in Florida and Investigated by the Florida Bar and was Found to be in Violation of the Unauthorized Practice of Law
Above is a disgruntled foreclosure lawyer, Lorelie Fiala‘s lawsuit for unpaid wages
4. Sanction.
board’s findings amply support its conclusion that the respondent violated multiple rules of professional conduct. In considering the single justice’s determination as to sanction, we inquire whether the sanction imposed is “markedly disparate from those ordinarily entered by the various single justices in similar cases.”
Matter of Alter, 389 Mass. 153, 156 (1983).
Considering the “cumulative effect of the several violations committed by the respondent,” Matter of Palmer, 413 Mass. 33, 38 (1992), and, like the single justice, giving “substantial deference to the board’s recommendation,” Matter of Foley, 439 Mass. 324, 333 (2003), we agree that disbarment is warranted, see Matter of Gordon, 385 Mass. 48, 58 (1982) (while board’s recommendation as to sanction is entitled to substantial deference, “ultimate duty of decision rests with this court”).
a. Sanction for established misconduct.
Although the board focused on the misconduct for which the most severe sanction is warranted, intentional misuse of client funds, bar counsel established a far broader swath of misconduct. Considering the cumulative effect of that misconduct reinforces the conclusion that disbarment is the correct sanction.
Bar counsel established that IOLTA funds intentionally were used, with the respondent’s knowledge, to pay the firm’s operating expenses.
At least one client, Ocwen, was deprived of more than $2 million dollars and, by the time of the disciplinary hearing, had not been reimbursed for the loss.
See Matter of Bryan, 411 Mass. 288, 292 (1991).
Disbarment is the presumptive sanction for intentional misuse of client funds, either with the intent to deprive or with actual deprivation resulting.
See Matter of Schoepfer, 426 Mass. 183, 186 (1997).
This is not a case where the misconduct consists more narrowly of failing adequately to supervise a nonlawyer’s handling of client funds.
In such cases, a term suspension has been imposed.
See Matter of Jackman, 444 Mass. 1013, 1014-1015 (2005) (two-year suspension, with prohibition on civil practice on reinstatement where attorney failed to supervise nonlawyer, resulting in commingling and conversion of client funds, without restitution);
Matter of Goldberg, 23 Mass. Att’y Discipline Rep. 191 (2007) (suspension of one year and one day for failure to supervise nonlawyer);
Matter of Gordon, 20 Mass. Att’y Discipline Rep. 166 (2004) (two-year suspension where attorney, victimized by employee theft, failed to reconcile and audit client account after learning of it, and engaged in other misconduct).
Even after becoming aware of Moss’s and Feige’s misuse of IOLTA funds for the firm’s operational benefit, the respondent failed to supervise the accounting staff and failed to make reasonable efforts to put in place measures that would provide reasonable assurances that the respondent’s professional obligations with respect to client funds were satisfied.
See Matter of Fuster, 24 Mass. Att’y Discipline Rep. 287 (2008) (eighteen-month suspension for failure to adequately supervise nonlawyers and other misconduct, including commingling and negligent misuse of client funds; prior record of discipline).
The respondent’s failure to terminate Feige, and allowing him to remain in control of the firm’s finances, ratified the misconduct within the meaning of Mass. R. Prof. C. 5.3 (c) (1) and (2).
Likewise, the respondent violated the rules of professional conduct directly and through the acts of another, in violation of Mass. R. Prof. C. 8.4 (a). In addition, the respondent’s failure to keep IOLTA records that complied with the requirements of Mass. R. Prof. C. 1.15 and the dishonored checks drawn on IOLTA accounts also warrant public discipline.
See Matter of Beatrice, 23 Mass. Att’y Discipline Rep. 31 (2007).
In connection with the factoring agreement, the respondent disclosed confidential client information for his own benefit, i.e., obtaining financing for the firm.
In so doing, he created a conflict of interest between his contractual obligation to Durham and his professional obligations to his clients.
See Matter of Wise, 433 Mass. 80, 90-92 (2000) (six-month suspension for conflict of interest and revealing confidential client information); Matter of Pike, 408 Mass. 740, 745-746 (1990) (six-month suspension for engaging in conflict of interest).
The respondent made material misrepresentations to Durham concerning the firm’s solvency and falsely represented that pledged assets had not been previously encumbered.
A term suspension has been imposed for similar misconduct.
See Matter of Hass, 477 Mass. 1015, 1017-1019 (2017) (two-month suspension for falsely representing that client settlement not already encumbered);
Matter of Goodman, 22 Mass. Att’y Discipline Rep. 352 (2006) (one-year suspension for multiple misrepresentations to insurance companies);
Matter of Behenna, 10 Mass. Att’y Discipline Rep. 15 (1994) (two-year suspension for executing closing documents that falsely represented terms of transaction).
b. Factors considered in mitigation and aggravation.
i. Mitigating factors.
In his answer to the petition for discipline, the respondent alleged no factors in mitigation of sanction. See Rules of the Board of Bar Overseers § 3.15(d), (f). At the hearing, while he testified to certain medical conditions and stress, he offered no medical records, expert testimony, or other evidence that those circumstances caused or contributed to the misconduct.
See Matter of Dragon, 440 Mass. 1023, 1024 (2003) (requiring causal connection between claimed mitigating factor and misconduct).
Further, those circumstances and stress appear to have occurred after the respondent became aware that Feige and others had misappropriated the IOLTA funds, in August 2013 at the latest.
We agree with the board that those factors do not weigh in mitigation of sanction.
The same is true of the respondent’s contention that he and his spouse lent money to the firm to pay the firm’s expenses and to restore the firm’s retirement plan.
Those “loans” do not serve as restitution to a client, see Matter of Bryan, 411 Mass. at 290-292, or evidence of reform, see Matter of Corbett, 478 Mass. 1004, 1005-1006 (2017).
Self-interested loans are not an outward sign of remorse.
See id.
Further, client funds are not fungible commodities, see Matter of Strauss, 479 Mass. at 301, and IOLTA accounts cannot be treated as a line of credit for a lawyer or law firm experiencing financial difficulties.
ii. Aggravating factors.
The board properly weighed multiple factors in aggravation, including the respondent’s use of IOLTA funds for personal gain, lack of candor before the hearing committee, harm to clients, and lack of acknowledgment of essential ethical rules.
After learning that the firm’s IOLTA accounts were being used to fund the firm’s operational needs, and knowing the firm’s strained financial condition, the respondent continued to collect his salary and use the firm’s funds to pay his own personal expenses.
He did not take necessary steps to ensure that IOLTA funds were properly managed, notwithstanding that bar counsel had twice previously investigated the firm when IOLTA checks were returned for insufficient funds.
At least one client was not compensated for its loss.
He “engaged in more and wider misconduct.”
Matter of Haese, 468 Mass. 1002, 1008 (2014).
Although the respondent contends that the board erred in weighing in aggravation the hearing committee’s finding that he gave false testimony before the hearing committee, he is entitled to defend himself.
While a respondent is entitled to defend himself, he is not entitled to testify falsely.
Finally, although the respondent contends that the board erred in finding that he demonstrated a lack of appreciation for basic ethics obligations and a lack of remorse, and in weighing those factors in aggravation, on the evidence presented, the board properly could conclude that the respondent’s “lack of remorse and insincerity with regard to acceptance of responsibility” are aggravating factors.[9]
Matter of Corbett, 478 Mass. at 1007.
5. Conclusion.
A bar discipline proceeding is not a forum best used broadly to cast blame or aspersions on others.
It is a proceeding with a narrow focus: to determine whether there is a preponderance of evidence that an attorney has violated one or more rules of professional conduct and, if so, what sanction is warranted.
The respondent’s continued focus in these proceedings on matters other than the charged misconduct does him a disservice because evidence of misconduct is neither excused nor obscured by accusations of misconduct by others.
With deference to the sanction recommended by the board, we affirm the judgment of the single justice that disbarment is warranted.
So ordered.
The case was submitted on the record, accompanied by a memorandum of law.
Mark L. Josephs for the respondent.
Footnotes
[1] This appeal is subject to the court’s standing order governing bar discipline appeals. See S.J.C. Rule 2:23, 471 Mass. 1303 (2015). Pursuant to the standing order, we dispense with oral argument.
[2] Lawrence F. Scofield defaulted on the petition for discipline and subsequently was disbarred. The petition for discipline proceeded to hearing solely against the respondent.
[3] In 2013, three partners were added to the firm, and it was restructured as “Connolly, Geaney, Ablitt & Willard, A Professional Corporation.” The firm, as restructured, closed in June 2014.
[4] The respondent’s argument that the single justice’s memorandum of decision is not sufficiently detailed is without merit. Like the single justice, we have considered the record in light of the respondent’s arguments that the board’s findings are not supported by substantial evidence, that it did not consider adequately his own testimony and documentary evidence, and that it relied on witnesses who he thought were not credible. Like the single justice, we conclude that the board’s findings are supported by substantial evidence.
[5] For convenience, in this opinion, we cite the current versions of the rules of professional conduct, which include substantially the same language as those in effect at the relevant times in this matter.
[6] Although the single justice did not separately address the denial of what the respondent characterizes as “voluminous” discovery, there is no merit to it, as the single justice correctly summarized.
[7] Section 4.9(a)(2) of the Rules of the Board of Bar Overseers provides that “[a] motion to take a discovery deposition shall be allowed only upon a showing of a substantial need for the deposition in the preparation of the applicant’s case, taking in to consideration: (A) The nature and complexity of the case and the need to assure an expeditious, economical and fair proceeding. (B) Whether the information sought or its substantial equivalent has been provided or was available by other means, taking into consideration the formal or informal discovery that has already occurred. (C) The prevention of embarrassment, oppression, or undue burden, including economic burden, that the deposition may cause the deponent.”
[8] Among the documents produced were messages from the e-mail boxes of Feige, Geaney, and Connolly. The respondent also obtained the e-mail box of an employee of Durham. Bar counsel provided the respondent’s e-mail box.
[9] Although both the board’s and the single justice’s memoranda reference events that occurred prior to the misconduct charged in the petition for discipline, those events do not form the basis for discipline. The references do not establish a violation of due process, as the respondent contends. See Matter of Strauss, 479 Mass. at 300 n.9.
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Chief Justice Kimberly S. Budd
Administered Oath December 1, 2020
SJC Chief Justice Kimberly Budd
Kimberly S. Budd became the 38th Chief Justice of the Supreme Judicial Court on December 1, 2020 when she was sworn in by Governor Charlie Baker. She was appointed as an Associate Justice on the Court on August 24, 2016.
Chief Justice Budd earned her Bachelor’s degree in English from Georgetown University and a law degree from Harvard Law School.
She began her legal career as a law clerk to Chief Justice Joseph P. Warner of the Massachusetts Appeals Court. She was a litigation associate at Mintz Levin, before serving as an Assistant United States Attorney in the United States Attorney’s Office for the District of Massachusetts in the Major Crimes and Drug Units. After that, she was a University Attorney for Harvard University in the General Counsel’s Office. She later served as Director of the Community Values program at Harvard Business School.
Chief Justice Budd was appointed as an Associate Justice of the Massachusetts Superior Court by Governor Deval Patrick in 2009. In 2016 she served as the Regional Administrative Justice for Middlesex Criminal Business.
Chief Justice Budd teaches in MCLE and Bar Association programs, is a former adjunct instructor at New England Law, and has taught trial advocacy at Harvard Law School. She is married with two sons.
Justice Frank M. Gaziano
Administered Oath August 18, 2016
Justice Frank M. Gaziano
Frank M. Gaziano, Associate Justice, was appointed to the Supreme Judicial Court by Governor Charlie Baker. Born in Quincy, Massachusetts, he received his B.A. from Lafayette College in 1986, and earned a J.D., magna cum laude, from Suffolk Law School in 1989. He began his legal career at the Boston law firm of Foley Hoag as a litigation associate. In 1991, he entered public service as an assistant district attorney with the Plymouth County District Attorney’s Office in Brockton. In Plymouth County, he prosecuted complex felony cases, including homicides, and represented the Commonwealth on appeal before the Appeals Court and the Supreme Judicial Court. In 2001, Justice Gaziano was appointed the First Assistant United States Attorney for the District of Massachusetts, where he was a member of the Organized Crime Strike Force.
Governor Mitt Romney appointed Justice Gaziano as an Associate Justice of the Superior Court in 2004. Justice Gaziano served as the Regional Administrative Justice for Plymouth County and for Criminal Business in Suffolk County. He also chaired the Supreme Judicial Court’s Standing Committee on Criminal Rules and was a member of the Supreme Judicial Court’s Model Homicide Jury Instruction Committee. He frequently presents educational programs for attorneys and judges on trial advocacy, evidence, criminal law, criminal procedure, and search and seizure.
Justice David A. Lowy
Administered Oath August 24, 2016
Justice David A. Lowy
David A. Lowy, Associate Justice, was appointed to the Supreme Judicial Court by Governor Charlie Baker. He earned a B.A., cum laude, Phi Beta Kappa, from the University of Massachusetts, Amherst in 1983, and graduated magna cum laude from Boston University School of Law in 1987.
Following law school, Justice Lowy became an associate in the Litigation Department of Goodwin, Procter & Hoar (1987-88 and 89-90), leaving for a year-long stint to work as a law clerk to Judge Edward F. Harrington in the U.S. District Court. He was also an assistant district attorney in Essex and Suffolk Counties (1992 -1997) and served as Deputy Legal Counsel to Governor William F. Weld (1992 -1995).
Justice Lowy was first appointed to the bench in 1997 as a District Court Judge. In 2001, Governor Paul Cellucci appointed him to the Superior Court bench.
Justice Lowy served on the Supreme Judicial Court Advisory Committee on Massachusetts Evidence Law as an Editor; the committee’s work resulted in publication of the Massachusetts Guide to Evidence in 2008.
Justice Lowy’s teaching positions include adjunct professorships at New England School of Law | Boston (1991- present); Suffolk University Law School (1995-2005), and Boston University School of Law (2006 – present), where he teaches courses in evidence.
Justice Elspeth B. Cypher
Administered Oath March 31, 2017
Justice Elspeth B. Cypher
Elspeth B. Cypher, Associate Justice, was appointed to the Supreme Judicial Court by Governor Charlie Baker. Justice Cypher was born in Pittsburgh, Pennsylvania, on February 26, 1959. She received a B.A., magna cum laude, from Emerson College in 1980 and a J.D., cum laude, from Suffolk University Law School in 1986, where she served on the Suffolk University Law Review.
From 1986 to 1988, she was an associate at the Boston law firm of Grayer, Brown and Dilday. In 1988 she became an Assistant District Attorney in Bristol County, where she served for the next twelve years. From 1993 to 2000, she was chief of the Appellate Division of that office and argued many cases before the Supreme Judicial Court and the Appeals Court. In 2000 Governor Paul Cellucci appointed her to the Appeals Court, and she took her seat as an Associate Justice on December 27, 2000.
For many years Justice Cypher was an adjunct professor at Southern New England School of Law (now the University of Massachusetts School of Law – Dartmouth), where she taught courses on legal writing; criminal procedure; criminal law; and women, law, and the legal system. She has participated in numerous educational programs for judges and lawyers and has written extensively about developments in criminal law in Massachusetts. Active in the Massachusetts Bar Association, Justice Cypher has served as co-chair of its criminal law section. She was the recipient of Massachusetts Lawyers Weekly’s Lawyer of the Year Award in 2000 for her work in the long running prosecutions of James M. Kater for the murder of Mary Lou Arruda.
In 2012, Justice Kent B. Smith asked her to co-author a fourth edition of his books in the Massachusetts Practice Series, Criminal Practice and Procedure. Before he passed away in October, 2012, she assumed responsibility for the supplement in 2013 and the fourth edition was published in 2014.
Justice Scott L. Kafker
Administered Oath August 21, 2017
Justice Scott L. Kafker
Scott L. Kafker, Associate Justice, was appointed to the Supreme Judicial Court by Governor Charlie D. Baker on August 21, 2017. Prior to this appointment, Justice Kafker served as Chief Justice of the Appeals Court from 2015 to 2017.
Justice Kafker graduated from Amherst College in 1981 and from the University of Chicago Law School in 1985, where he was on the Law Review. After law school, he served as a law clerk to Justice Charles L. Levin of the Michigan Supreme Court, then as a law clerk to Judge Mark L. Wolf of the United States District Court for the District of Massachusetts. In 1987, he joined the Boston law firm of Foley, Hoag & Eliot as an associate. From 1991 to 1993, Justice Kafker was deputy chief legal counsel to Governor William F. Weld. In 1993, he was named chief legal counsel for the Massachusetts Port Authority. He was appointed to the Appeals Court by Governor Paul Cellucci and joined the Court on March 7, 2001. Governor Baker appointed him the sixth Chief Justice of the Appeals Court on July 22, 2015.
Justice Kafker taught state constitutional law at Boston College Law School from 2009 to 2015. He has also served on the Visiting Committee of the University of Chicago Law School. He is the author of book reviews, comments and articles appearing in the University of Chicago Law Review, The Labor Lawyer, Massachusetts Law Review, Michigan State Law Review, New England Law Review, Washington and Lee Law Review, and the Rutgers Law Journal. He served on the Supreme Judicial Court Advisory Committee on the Rules of Civil and Appellate Procedure from 2008 to 2015. He now serves as President and Dean of the Flaschner Judicial Institute. He is also a member of the American Law Institute.
Justice Dalila Argaez Wendlandt
Administered Oath December 4, 2020
SJC Justice Dalila Argaez Wendlandt
Dalila Argaez Wendlandt, Associate Justice, was appointed to the Supreme Judicial Court by Governor Charlie Baker on December 4, 2020. Prior to this appointment, Justice Wendlandt served as an Associate Justice in the Appeals Court from 2017 to 2020.
Born in New Orleans, Louisiana, Justice Wendlandt graduated from the University of Illinois Urbana-Champaign in 1991 with a Bachelor of Science in Mechanical Engineering and from the Massachusetts Institute of Technology with a Master of Science in Mechanical Engineering in 1993. While at MIT, she designed, manufactured and developed the non-collocated control of a climbing robot. She then earned her Juris Doctor degree, with highest honors, from Stanford University Law School in 1996, where she was an article editor of the Stanford Law Review.
Upon graduation, Justice Wendlandt clerked for the Honorable John M. Walker, Jr., of the United States Court of Appeals for the Second Circuit. She joined the firm of Ropes & Gray LLP in 1997, eventually becoming a partner in the Intellectual Property Litigation Group of that firm. Her practice focused on counselling clients in such diverse industries as semiconductor manufacturing, medical devices and pharmaceuticals, with particular emphasis on electro-mechanical devices and controls algorithms, regarding patent and trade secret misappropriation litigation. Her active trial and litigation practice included a successful appeal to the U.S. Supreme Court challenging a federal statute on constitutional grounds. She was also active in firm’s administration, particularly with regard to hiring and coordinating the firm’s summer associate program. She also served on the firm’s flextime committee, assisting lawyers who desired flexible work arrangements.
Justice Wendlandt has published widely on the subject of patent law, writing in technical journals like Biotechnology Law Report to more popular publications such as Forbes. She has also lectured extensively at specialized seminars, bar associations and a law school. Justice Wendlandt assisted clients in pro bono activities such as requests for political asylum and a death row inmate’s post-trial petitions. She also served as a Middlesex County Special Assistant District Attorney in two appellate matters.
Justice Serge Georges, Jr.
Administered Oath December 16, 2020
SJC Justice Serge Georges, Jr.
Serge Georges, Jr., Associate Justice, was appointed to the Supreme Judicial Court by Governor Charlie Baker on December 16, 2020. He earned his Bachelor’s degree from Boston College in 1992 and his law degree from Suffolk University Law School in 1996.
Following law school, Justice Georges began his legal career as a litigation associate at Rackemann, Sawyer & Brewster, P.C. and Todd & Weld, LLP. In 2007 he joined the firm of Barron & Stadfeld, P.C., eventually becoming a partner. He had a diverse practice focused on commercial litigation and criminal defense practice in state and federal courts. Governor Deval Patrick appointed Justice Georges as an Associate Justice of the Boston Municipal Court in 2013.
Justice Georges’ teaching positions include adjunct professorships at Suffolk University Law School (2000 – present) and University of Massachusetts School of Law (2019 to present) where he teaches courses in Evidence, Professional Responsibility and Trial Advocacy and frequently presents educational programs at Judicial Education programs, MCLE and Bar Association programs.
Appellate Circuit
Constance Daniels, Student of Hard Knocks, Admonished Florida Lawyer and Friend of The Eleventh Circuit
LIF cannot comprehend how the People of Florida and the United States of America are so accepting of Brazen Corruption.
LIF UPDATE
JUL 28, 2024
The case settles on remand from the 11th Circuit and Daniels signs a loan modification agreement with a commencement date of Jun 20, 2023 for a sum of $329k and a period of 144 months with a balloon payment of $267k due on maturity. Her property at 3927 Dunaire Dr, Valrico, FL 33596 is valued today at appx. $457k.
As an aside, admonished Florida lawyer Constance Daniels had around $400k worth of IRS Tax Liens released between 2023 and 2024 ($383k).
LIF UPDATE
OCT 26, 2022
Five months after the 11th Circuit saved a colleague and lawyer from foreclosure, the mandate issued (without en banc hearing) and as instructed (reversed and remanded) the lower court has reopened the case.
LIT will be tracking this case closely, stay tuned.
LIF COMMENTARY
The article below starts with Constance Daniels failure to pay for her law school tuition loan issued in 2003. She defaulted in 2005 per the complaint. The USA won a judgment of $164k+ in 2011.
In 2010, Wells Fargo commenced foreclosure proceedings in state court, Hillsborough County.
While all this was going on, Ms Daniels, a Republican, was attempting to become a State judge in 2014, which failed.
In late November of 2017 a settlement was reached, dismissing the Wells Fargo foreclosure complaint.
In 2017-2018, lawyer Daniels was failing to look after her client(s). Many moons later, in 2021, that would result in a slap on the wrist by the referee, Hon. Daniel D. Diskey for Fl. Bar.
Then we move onto the June 2018 complaint, filed by Daniels against the mortgage servicer. It was removed to the lower court in Middle District of Florida Federal Court.
The court, via one of the Moody clan of judges, sided with Select Portfolio Servicing, LLC and this formed the appeal which was decided this week by the 11th Circuit.
In Nov. 2020, Wells Fargo filed a renewed foreclosure complaint against Daniels and her homestead in State court. In Sept 2021, Wells Fargo voluntarily dismissed the case and terminated the lis pendens ‘due to loan modification’.
The issue for LIF in this case is quite clear. Who the 11th Circuit has chosen to upend it’s prior stance that mortgage servicers can do no wrong under the FDCPA, despite irrefutable facts confirming otherwise.
For example, LIF refers to the case we highlighted regarding a deficiency judgment (State case, March 2022):
“Florida Lawyer Stephanie Schneider Appeals a Mortgage Foreclosure Deficiency Judgment”
In that case, LIF investigated beyond the court opinions to discover the wife is a Florida Lawyer and her husband, Laurence Schneider is owner of S&A Capital, Inc., a mortgage investment company, has built a national portfolio of performing mortgages that have been written off by other financial institutions.
Our angst is clear. Lawyers are being treated preferentially by the courts over regular citizens and homeowners.
In the case of Daniels, whilst she may have legitimate arguments, there have been many citizens who have failed before her by the wordsmithing by the Federal and Appellate Court(s), which has refused to apply the correct legal interpretation of the FDCPA, or clarify the question(s) with the federal consumer agency, the CFPB.
Whilst LIF is unhappy with the anti-consumer watchdog, the Consumer Financial Protection Bureau (CFPB) which is a revolving door for staff to leave the Bureau and go work for a creditor rights law firm without any restriction or time limit (non-compete), the Daniels case should have been referred to the CFPB for interpretation about the matters of ‘first impression’.
The Second Circuit recently did so for a RESPA question in Naimoli v Ocwen and we highlighted the case on our sister website, LawsInTexas.com (Laws In Texas). Instead of doing so in Daniels, there is a dissenting opinion by Judge Lagoa, who’s father in law is a senior judge in SD Florida (Paul C. Huck) and her hubby is a Jones Day Partner and apparently the leader of the Miami Chapter of the Federalist Society. Lagoa herself is a former Florida Supreme Court justice appointed by Gov DeSantis who ‘ensured he puts conservatives on the bench so that anyone coming to court knows how the court will rule’.
LIF anticipates the Daniels case will be subject to a rehearing petition and presented to the full en banc court for reconsideration. The opinion here is similar to the recent Newsom FDCPA opinion, which was too negative towards Wall St and the financial banking services community. As such, it was vacated by the en banc panel while they reconsider. The courts’ decision is currently pending.
In this case, there is still time for the 11th Circuit to correctly ask the CFPB to provide its opinion on the underlying facts raised on appeal and decided by the 3-panel.
However, what the judiciary won’t do is apply this retroactively to the thousands of cases which have been incorrectly tossed in the last 14 years, resulting in homeowners losing their homes to wrongful foreclosures.
United States v. Daniels (2011)
(8:11-cv-01058)
District Court, M.D. Florida
MAY 13, 2011 | REPUBLISHED BY LIT: MAY 26, 2022
USA Motion for Summary Judgment with Exhibits, Doc. 13, Aug 17, 2011
ORDER granting Motion for summary judgment in favor of the Plaintiff and against the defendant in the amount of $109,813.74,
together with accrued interest in the amount of $54,097.10 as of February 28, 2011,
plus interested at the rate of 8.25 percent per annum and a daily rate of $24.80, until the date of judgment;
for post-judgment interest, at the legal rate, from the entry of final judgment until the date of payment;
and for such other costs of litigation otherwise allowed by law.
The Clerk of Court is directed to close the case.
Signed by Judge Elizabeth A. Kovachevich on 9/22/2011.
(SN) (Entered: 09/22/2011)
U.S. District Court
Middle District of Florida (Tampa)
CIVIL DOCKET FOR CASE #: 8:11-cv-01058-EAK-AEP
| USA v. Daniels Assigned to: Judge Elizabeth A. Kovachevich Referred to: Magistrate Judge Anthony E. Porcelli Demand: $164,000 Cause: 28:1345 Default of Student Loan |
Date Filed: 05/13/2011 Date Terminated: 09/22/2011 Jury Demand: None Nature of Suit: 152 Contract: Recovery Student Loan Jurisdiction: U.S. Government Plaintiff |
| Plaintiff | ||
| USA | represented by | I. Randall Gold US Attorney’s Office – FLM Suite 3200 400 N Tampa St Tampa, FL 33602-4798 813/274-6026 Fax: 813/274-6247 Email: FLUDocket.Mailbox@usdoj.gov LEAD ATTORNEY ATTORNEY TO BE NOTICED |
| V. | ||
| Defendant | ||
| Constance Daniels | represented by | Constance Daniels PO Box 6219 Brandon, FL 33608 PRO SE |
| Date Filed | # | Docket Text |
|---|---|---|
| 05/13/2011 | 1 | COMPLAINT against Constance Daniels filed by USA. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Civil Cover Sheet)(MRH) (Entered: 05/13/2011) |
| 05/13/2011 | 2 | Summons issued as to Constance Daniels. (MRH) (Entered: 05/13/2011) |
| 05/13/2011 | 3 | ORDER regulating the processing of civil recovery actions. Service must be perfected by 09/10/2011. Signed by Deputy Clerk on 5/13/2011. (MRH) (Entered: 05/13/2011) |
| 05/13/2011 | 4 | STANDING ORDER: Filing of documents that exceed twenty-five pages. Signed by Judge Elizabeth A. Kovachevich on 7/15/08. (MRH) (Entered: 05/13/2011) |
| 05/19/2011 | 5 | NOTICE of designation under Local Rule 3.05 – track 1 (CLM) (Entered: 05/19/2011) |
| 05/20/2011 | 6 | CERTIFICATE OF SERVICE re 3 ORDER regulating the processing of civil recovery actions by USA (Gold, I.) Modified on 5/20/2011 (MRH). (Entered: 05/20/2011) |
| 05/25/2011 | 7 | CERTIFICATE OF SERVICE by USA (Notice of Designation Under Local Rule 3.05) (Gold, I.) (Entered: 05/25/2011) |
| 07/06/2011 | 8 | RETURN of service executed on 7/5/11 (Marshal 285) by USA as to Constance Daniels. (MRH) (Entered: 07/06/2011) |
| 07/27/2011 | 9 | MOTION for default judgment against Constance Daniels by USA. (Gold, I.) Modified on 7/27/2011 (MRH). NOTE: TERMINATED. INCORRECT MOTION RELIEF. ATTORNEY NOTIFIED. ATTORNEY TO REFILE. (Entered: 07/27/2011) |
| 07/27/2011 | 10 | MOTION for entry of clerk’s default against Constance Daniels by USA. (Gold, I.) Motions referred to Magistrate Judge Anthony E. Porcelli. (Entered: 07/27/2011) |
| 07/28/2011 | 11 | CLERK’S ENTRY OF DEFAULT as to Constance Daniels. (MRH) (Entered: 07/28/2011) |
| 07/29/2011 | 12 | ANSWER to 1 Complaint by Constance Daniels.(BES) (Entered: 07/29/2011) |
| 08/17/2011 | 13 | MOTION for summary judgment by USA. (Attachments: # 1 Exhibit A, # 2 Exhibit B)(Gold, I.) (Entered: 08/17/2011) |
| 09/09/2011 | 14 | ENDORSED ORDER TO SHOW CAUSE as to Constance Daniels.. The plaintiff filed a motion for summary judgment on 8/17/11. The defendant had up to and including 9/3/11 to respond to the motion. To date no response has been filed. Therefore, it is ORDERED that the defendant has up to and including 9/19/11 in which to show cause why the pending motion should not be granted. Signed by Judge Elizabeth A. Kovachevich on 9/9/2011. (SN) (Entered: 09/09/2011) |
| 09/22/2011 | 15 |
ORDER granting 13 Motion for summary judgment in favor of the Plaintiff and against the defendant in the amount of $109,813.74, together with accrued interest in the amount of $54,097.10 as of February 28, 2011, plus interested at the rate of 8.25 percent per annum and a daily rate of $24.80, until the date of judgment; for post-judgment interest, at the legal rate, from the entry of final judgment until the date of payment; and for such other costs of litigation otherwise allowed by law. The Clerk of Court is directed to close the case.. Signed by Judge Elizabeth A. Kovachevich on 9/22/2011. (SN) (Entered: 09/22/2011) |
| 10/12/2011 | 16 | ABSTRACT of judgment as to Constance Daniels. (DMS) (Entered: 10/12/2011) |
Order GRANTING Summary Judgment for $164k Student Loan Debt, Doc. 15, Sep 22, 2011
Daniels v. Select Portfolio Servicing, Inc.
LIF’s Post Reverse and Remand from CA11 Update, July 28, 2024
The case would settle.
(8:18-cv-01652)
District Court, M.D. Florida
NOTICE of settlement Pending by Constance Daniels (Diamond, Kaelyn)
(Entered: 05/10/2023)
60-DAY ORDER OF DISMISSAL re 52 Notice of Pending Resolution. All pending motions, if any, are DENIED as moot. The Clerk is directed to close the file. Signed by Judge James S. Moody, Jr. on 5/10/2023. (SMB)
(Entered: 05/10/2023)
| CLOSED,MEDIATION |
U.S. District Court
Middle District of Florida (Tampa)
CIVIL DOCKET FOR CASE #: 8:18-cv-01652-JSM-CPT
| Daniels v. Select Portfolio Servicing, Inc. Assigned to: Judge James S. Moody, Jr Referred to: Magistrate Judge Christopher P. Tuite
Cause: 28:1332 Diversity-Breach of Contract |
Date Filed: 07/11/2018 Date Terminated: 05/10/2023 Jury Demand: Plaintiff Nature of Suit: 190 Contract: Other Jurisdiction: Diversity |
| Date Filed | # | Docket Text |
|---|---|---|
| 05/24/2022 | 32 | USCAS OPINION issued by court as to Appellant Constance Daniels. Decision: REVERSED and REMANDED as to 29 Notice of Appeal. EOD: 05/24/22; Mandate to issue at a later date. USCA number: 19-10204-GG. (AG) (Entered: 05/26/2022) |
| 08/31/2022 | 33 | USCA ORDER: Appellant’s motion for appellate attorney’s fees is TRANSFERRED to the district court for its consideration of whether Appellant is entitled to appellate attorney’s fees and the amount of appellate attorney’s fees to which Appellant is entitled, if any, as too 29 Notice of Appeal filed by Constance Daniels. EOD: 08/29/2022; USCA number: 19-10204-GG. (AG) (Entered: 08/31/2022) |
| 08/31/2022 | 34 | MOTION for Attorney Fees by Constance Daniels. (Attachments: # 1 Exhibit A, # 2 Declaration, # 3 Exhibits 1-4 to Declaration, # 4 Exhibit)(AG) (Filed in the 11th Circuit on 8/29/2022) Modified on 8/31/2022 (AG). (Entered: 08/31/2022) |
| 09/01/2022 | 35 | ENDORSED ORDER denying without prejudice 34 Motion for Attorney’s Fees. The record reflects that the Mandate from the Eleventh Circuit has not been issued. The Motion for Attorney’s Fees may be refiled after the mandate is issued and docketed. The Motion shall also be modified to comply with the Court’s local rules. Signed by Judge James S. Moody, Jr on 9/1/2022. (JG) (Entered: 09/01/2022) |
| 10/26/2022 | 36 | MANDATE of USCA: REVERSED AND REMANDED as to 29 Notice of Appeal filed by Constance Daniels. Issued as Mandate: 10/26/22. USCA number: 19-10204-GG. (Attachments: # 1 Bill of Costs, # 2 USCA memo)(JNB) (Entered: 10/26/2022) |
| 10/26/2022 | 37 | ENDORSED ORDER: The Clerk is directed to reopen the case. The parties shall file a joint status report within fourteen days as to how they wish to proceed in light of the Eleventh Circuit’s Opinion. Signed by Judge James S. Moody, Jr. on 10/26/2022. (SMB) (Entered: 10/26/2022) |
| 11/03/2022 | 38 | NOTICE of Appearance by Gabriela N. Timis on behalf of Select Portfolio Servicing, Inc. (Timis, Gabriela) (Entered: 11/03/2022) |
| 11/09/2022 | 39 | STATUS report by Constance Daniels. (Diamond, Kaelyn) (Entered: 11/09/2022) |
| 11/09/2022 | 40 | CASE MANAGEMENT REPORT. (Diamond, Kaelyn) (Entered: 11/09/2022) |
| 11/09/2022 | 41 | MOTION for Attorney Fees as to Entitlement to Appellate Fees and Costs Only by Constance Daniels. (Diamond, Kaelyn) (Entered: 11/09/2022) |
| 11/09/2022 | 42 | ENDORSED ORDER: Defendant shall file its answer on or before November 18, 2022. Signed by Judge James S. Moody, Jr. on 11/9/2022. (SMB) (Entered: 11/09/2022) |
| 11/14/2022 | 43 | CASE MANAGEMENT AND SCHEDULING ORDER: Discovery due by 5/26/2023; Dispositive motions due by 6/30/2023; Pretrial Conference set for TUESDAY, DECEMBER 5, 2023, at 9:00 A.M. in Tampa Courtroom 17 before Judge James S. Moody Jr. Jury Trial set on the JANUARY 2024 trial term in Tampa Courtroom 17 before Judge James S. Moody Jr. Conduct mediation hearing by 6/16/2023. Lead counsel to coordinate dates. Signed by Judge James S. Moody, Jr. on 11/14/2022. (SMB) (Entered: 11/14/2022) |
| 11/18/2022 | 44 | ANSWER and affirmative defenses to 23 Amended Complaint by Select Portfolio Servicing, Inc.(Kohn, Joseph) Modified text on 11/21/2022 (MCB). (Entered: 11/18/2022) |
| 11/23/2022 | 45 | RESPONSE in Opposition re 41 MOTION for Attorney Fees as to Entitlement to Appellate Fees and Costs Only filed by Select Portfolio Servicing, Inc. (Kohn, Joseph) Modified text on 11/28/2022 (SET). (Entered: 11/23/2022) |
| 12/12/2022 | 46 | ENDORSED ORDER denying without prejudice as premature 41 Motion for Attorney Fees for the reasons stated in the Response 45. Signed by Judge James S. Moody, Jr on 12/12/2022. (JG) (Entered: 12/12/2022) |
| 01/04/2023 | 47 | NOTICE of mediation conference/hearing to be held on June 14, 2023 at 1:30 P.M. before Gregory Holder. (Diamond, Kaelyn) (Entered: 01/04/2023) |
| 01/04/2023 | 48 | ORDER appointing Gregory P. Holder, Esq. as mediator in this action. Mediation is scheduled for June 14, 2023, at 1:30 p.m. Signed by Judge James S. Moody, Jr. on 1/4/2023. (SMB) (Entered: 01/04/2023) |
| 03/30/2023 | 49 | STIPULATION /Joint Motion to Extend Case Management Deadlines and Incorporated Memorandum of Law by Constance Daniels. (Diamond, Kaelyn) (Entered: 03/30/2023) |
| 03/31/2023 | 50 | ENDORSED ORDER granting in part 49 Joint Motion to Extend Case Management Deadlines filed by Constance Daniels. The pretrial conference and trial dates remain unchanged. No further extensions of time will be granted absent a showing of good cause. The Court will enter an amended scheduling order separately. Signed by Judge James S. Moody, Jr. on 3/31/2023. (SMB) (Entered: 03/31/2023) |
| 03/31/2023 | 51 | CASE MANAGEMENT AND SCHEDULING ORDER: Discovery due by 7/25/2023; Dispositive motions due by 8/29/2023; Pretrial Conference set for TUESDAY, DECEMBER 5, 2023, at 9:00 A.M. in Tampa Courtroom 17 before Judge James S. Moody Jr. JURY TRIAL is set on the JANUARY 2024 trial term in Tampa Courtroom 17 before Judge James S. Moody Jr. Signed by Judge James S. Moody, Jr. on 3/31/2023. (SMB) (Entered: 03/31/2023) |
| 05/10/2023 | 52 | NOTICE of settlement Pending by Constance Daniels (Diamond, Kaelyn) (Entered: 05/10/2023) |
| 05/10/2023 | 53 | 60-DAY ORDER OF DISMISSAL re 52 Notice of Pending Resolution. All pending motions, if any, are DENIED as moot. The Clerk is directed to close the file. Signed by Judge James S. Moody, Jr. on 5/10/2023. (SMB) (Entered: 05/10/2023) |
| PACER Service Center | |||
|---|---|---|---|
| Transaction Receipt | |||
| 07/28/2024 18:04:57 |
JUDGE ESKRIDGE
“ORDER re: By email to the Case Manager, the parties have provided notice of settlement of their dispute.”FIFTH CIRCUIT
“By informing the court that the case had settled, the plaintiff did not “instigate dismissal.” https://t.co/zq7t3oR77E pic.twitter.com/t5p1Tb5p80— lawsinusa (@lawsinusa) July 24, 2024
Daniels v. Select Portfolio Servicing, Inc.
(2018-Present)
(8:18-cv-01652)
District Court, M.D. Florida
ORDER
THIS CAUSE comes before the Court upon Defendant’s Motion to Dismiss Plaintiff’s Second Amended Complaint (Dkt. 24) and Plaintiff’s Response in Opposition (Dkt. 27).
The Court, having reviewed the motion, response, and being otherwise advised in the premises, concludes that Defendant’s motion should be granted.
Specifically, Plaintiff’s second amended complaint will be dismissed with prejudice because any further amendment is futile.
BACKGROUND
As the Court explained in its prior Order granting Defendant’s motion to dismiss, (see Dkt. 22), Plaintiff Constance Daniels initially filed suit in Florida state court against Defendant Select Portfolio Servicing, Inc. (“SPS”) alleging three Florida claims, which included a claim under Florida’s civil Racketeer Influenced and Corrupt Organizations (“RICO”) Act.
On July 10, 2018, SPS removed the case to this Court based on diversity jurisdiction.
On August 6, 2018, SPS moved to dismiss the entire complaint.
In relevant part, SPS argued that the complaint failed to allege any of the elements of a RICO claim.
On August 27, 2018, Daniels filed an amended complaint, which mooted SPS’s motion to dismiss.
Daniels’ amended complaint alleged two claims: a claim under the Fair Debt Collection Practices Act (“FDCPA”) and a claim under the Florida Consumer Collections Practices Act (“FCCPA”).
Both claims relied on the same allegations.
To summarize, Daniels alleged that SPS had “improperly servic[ed]” her mortgage loan “in reckless disregard” of her consumer rights. (Dkt. 12).
The amended complaint did not attach any mortgage statements.
SPS moved to dismiss Daniels’ amended complaint based on her failure to allege that SPS ever attempted to collect the mortgage balance.
The Court granted SPS’s motion.
The Court noted that the amended complaint did not identify or attach any communication from SPS to Daniels.
The Court also surmised that the dispute was more akin to a dispute about an improper accounting of Daniels’ mortgage.
The Court dismissed the FDCPA and FCCPA claims and provided Daniels a final opportunity to amend her complaint.
Daniels filed a second amended complaint.
The allegations are largely unchanged.
But, significantly, Daniels attaches multiple monthly mortgage statements that SPS sent to her.
She now claims that these mortgage statements constitute debt collection activity under the FDCPA and FCCPA.
SPS’s motion to dismiss argues that the monthly mortgage statements comply with Regulation Z of the Truth in Lending Act (the “TILA”)—they were not communications in connection with the collection of a debt—and therefore do not constitute debt collection activity under the FDCPA and FCCPA.
As explained further below, the Court agrees with SPS’s position based on the Court’s detailed review of the monthly mortgage statements.
Therefore, the second amended complaint will be dismissed with prejudice.
STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(b)(6) allows a court to dismiss a complaint when it fails to state a claim upon which relief can be granted.
When reviewing a motion to dismiss, a court must accept all factual allegations contained in the complaint as true.
Erickson v. Pardus, 551 U.S. 89, 94 (2007) (internal citation omitted).
It must also construe those factual allegations in the light most favorable to the plaintiff.
Hunt v. Aimco Properties, L.P., 814 F.3d 1213, 1221 (11th Cir. 2016) (internal citation omitted).
To withstand a motion to dismiss, the complaint must include “enough facts to state a claim to relief that is plausible on its face.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).
A claim has facial plausibility “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Pleadings that offer only “labels and conclusions,” or a “formulaic recitation of the elements of a cause of action,” will not do.
Twombly, 550 U.S. at 555.
DISCUSSION
The FDCPA and FCCPA prohibit debt collectors from using a “false, deceptive, or misleading representation or means in connection with the collection of any debt.”
See e.g. 15 U.S.C. § 1692e (emphasis added);
Fla. Stat. § 559.72 (“In collecting debts, no person shall . . .”) (emphasis added).
It is axiomatic then that the “challenged conduct is related to debt collection” to state a claim under either statute.
Reese v. Ellis, Painter, Ratterree & Adams, LLP, 678 F.3d 1211, 1216 (11th Cir. 2012);
see also Garrison v. Caliber Home Loans, Inc., 233 F. Supp. 3d 1282, 1286 (M.D. Fla. 2017) (“the FCCPA is a Florida state analogue to the federal FDCPA.”) (internal citations omitted).
“[T]he Eleventh Circuit has not established a bright-line rule” as to what qualifies as “in connection with the collection of any debt.”
Dyer v. Select Portfolio Servicing, Inc., 108 F. Supp. 3d 1278, 1280 (M.D. Fla. 2015).
“As a general principle, the absence of a demand for payment is not dispositive,” and courts should “instead consider whether the overall communication was intended to induce the debtor to settle the debt.”
Wood v. Citibank, N.A., No. 8:14-cv-2819-T-27EAJ, 2015 WL 3561494, at *3 (M.D. Fla. June 5, 2015) (citations omitted).
The second amended complaint attaches multiple monthly mortgage statements.1
Because the communications at issue here are all monthly mortgage statements, a discussion of the TILA is necessary.
The TILA requires SPS, a servicer, to send monthly mortgage statements.
12 C.F.R. § 1026.41. Specifically, 12 C.F.R. § 1026.41(d) requires that servicers provide debtors with detailed monthly mortgage statements containing, among other things: the “amounts due;” the “payment due date;” “the amount of any late payment fee, and the date that fee will be imposed if payment has not been received;” “an explanation of amount due, including a breakdown showing how much, if any, will be applied to principal, interest, and escrow and, if a mortgage loan has multiple payment options, a breakdown of each of the payment options;” “any payment amount past due;” a breakdown of “the total of all payments received since the last statement” and “since the beginning of the current calendar year;” “a list of all transaction activity that occurred since the last statement;” “partial payment information;” “contact information;” and detailed “account information” and “delinquency information.”
The Consumer Financial Protection Bureau (the “CFPB”) has issued a bulletin providing that a
“servicer acting as a debt collector would not be liable under the FDCPA for complying with [monthly mortgage statement] requirements.”
Implementation Guidance for Certain Mortgage Servicing Rules, 10152013 CFPB GUIDANCE, 2013 WL 9001249 (C.F.P.B. Oct. 15, 2013).
Courts have largely followed this guidance.
See, e.g., Jones v. Select Portfolio Servicing, Inc., No. 18-cv-20389, 2018 WL 2316636, at *3 (S.D. Fla. May 2, 2018) (citing 12 C.F.R. § 1026.41(d));
Brown v. Select Portfolio Servicing, Inc., No. 16-62999-CIV, 2017 WL 1157253 (S.D. Fla. Mar. 24, 2017) (noting the guidance and finding that monthly mortgage statements in compliance with the TILA were not debt collection).
The monthly mortgage statements at issue here were in conformity with the TILA requirements.
Moreover, the subject statements were substantially similar to model form H-30(B) provided by Appendix X to Part 1026 of TILA Regulation Z.
See also Jones, 2018 WL 2316636, at *4 (noting the similarities between a monthly mortgage statement and the model form in concluding no debt collection).
Although the monthly mortgage statements may not be identical to model form H-30(B), the differences are not significant deviations.
Notably, the plaintiff in Brown brought a nearly identical lawsuit against SPS.
The court explained in detail why the plaintiff was unable to state a claim under the FDCPA and FCCPA because the monthly mortgage statement was required to be sent pursuant to the TILA.
The complaint in Brown was dismissed with prejudice because “amendment would be futile” given that the basis for the claims was a monthly mortgage statement that was not actionable as a matter of law.
See 2017 WL 1157253, at *2-*4.
Also, the Jones court discussed in detail the numerous prior decisions addressing this issue, including multiple cases from this district that have held that monthly mortgage statements
“are almost categorically not debt collection communications under the FDCPA.”
2018 WL 2316636, at *5 (citing cases).
The particular monthly mortgage statements before the court in Jones were also sent by SPS and were substantively identical to the statements at issue in this case and in Brown.
Most recently, in Mills v. Select Portfolio Servicing, Inc., No. 18-cv-61012- BLOOM/Valle, 2018 WL 5113001 (S.D. Fla. Oct. 19, 2018), the court “agree[d] with the reasoning in Jones and [concluded] that the Mortgage Statements at issue [were] not communications in connection with a collection of a debt.” Id. at *2.
In conclusion, the substance of the monthly mortgage statements at issue in this case is substantially similar to model form H-30(B).
Any minor discrepancies in the language—when taken in the context of the document as an otherwise carbon copy of form H-30(B)—do not take the statements out of the realm of a monthly mortgage statement and into the realm of debt collection communications.
It is therefore ORDERED AND ADJUDGED that:
1. Defendant’s Motion to Dismiss Plaintiff’s Second Amended Complaint (Dkt.
24) is granted.
2. Plaintiff’s Second Amended Complaint is dismissed with prejudice.
3. The Clerk of Court is directed to close this case and terminate any pending motions as moot.
DONE and ORDERED in Tampa, Florida on December 18, 2018.
Copies furnished to: Counsel/Parties of Record
Judge Bert Jordan’s “Reputation” Warning to New Florida Lawyers
Constance Daniels Admonished by the Florida Bar (2021)
Constance Daniels, P.O. Box 6219, Brandon, admonishment in writing and directed to attend Ethics School effective immediately following a November 24 court order.
(Admitted to practice: 1995)
Daniels failed to act with reasonable diligence and failed to communicate with her client in connection with a dissolution of marriage action.
Daniels also failed to timely respond to the Bar’s formal complaint.
Constance Daniels v. Select Portfolio Servicing, Inc. (2022)
11th Cir., Published Opinion
(19-10204, May 24, 2022)
“A matter of first impression” 14 Years after the great recession and greatest theft of citizens homes in the history of the United States.
It’s quite incredulous how the 11th Circuit selects a Sanctioned Fl. Republican Lawyer, a failed judicial candidate and one who is facing foreclosure, for this ‘landmark’ published opinion in 2022.
Panel Author, Judge Bert Jordan, joined by Judge Brasher with a dissenting opinion by Judge Babs Lagoa
Selective Justice = Ochlocracy and Corruption.
WHY IS THERE NO CHARGES FOR LAWYERS STEALIN’ MILLIONS? https://t.co/gkMkVMboYZ@USAO_NJ @USAO_MDFL @SDFLnews @CityBocaRaton @AGAshleyMoody @flcourts @TheFlaBar @FLBarPresident @SWFLCourts @WSJ @nytimes @reason @MotherJones @ABC— lawsinusa (@lawsinusa) May 26, 2022
11th Circuit revives FDCPA lawsuit over mortgage statement language
How Westlaw is Summarizing the Latest Eleventh Circuit Opinion
(May 26, 2022)
Resolving an issue of first impression, a divided federal appeals panel has held that mortgage servicers can be liable under the Fair Debt Collection Practices Act for inaccuracies in monthly mortgage statements that contain additional debt-collection language.
Daniels v. Select Portfolio Servicing Inc., No. 19-10204, (11th Cir. May 24, 2022).
In a 2-1 decision, the 11th U.S. Circuit Court of Appeals on May 24 reinstated Constance Daniels’ lawsuit against Select Portfolio Servicing Inc., in which she alleges the company used faulty mortgage statements to try to collect payments she did not owe.
Writing for the panel majority, U.S. Circuit Judge Adalberto J. Jordan acknowledged that Select Portfolio was required to issue the mortgage statements under the Truth in Lending Act, 15 U.S.C.A. § 1638.
However, the mortgage statements fell within the scope of the FDCPA’s prohibition on false or misleading representations, 15 U.S.C.A. § 1692e, because they included additional debt-collection language — “this is an attempt to collect a debt” — the opinion said.
Judge Jordan reasoned that “in determining whether a communication is in connection with the collection of a debt, what could be more relevant than a statement in the communication than ‘this is an attempt to collect a debt’?”
U.S. Circuit Judge Barbara Lagao dissented, saying the majority treated the language like “magic words” that could convert an otherwise routine mortgage statement into a communication covered by the FDCPA.
Judge Lagoa also argued that the decision created a circuit split, although the panel majority insisted that the facts of Daniels’ case distinguished it from others in which federal circuit courts seemed to reach a contrary result.
District Court tosses FDCPA claims
Daniels sued Select Portfolio in the U.S. District Court for the Middle District of Florida in July 2018.
According to the suit, Daniels had prevailed in a state court foreclosure action brought by lender Wells Fargo in 2015, with the judge sanctioning Wells Fargo and enforcing an earlier loan modification agreement between the parties.
But Daniels’ mortgage servicer, Select Portfolio, later issued several monthly mortgage statements misstating the principal balance and amount due, and falsely claiming that her loan was in arrears, the suit says.
At least three of the mortgage statements included the sentence, “This is an attempt to collect a debt,” according to the suit.
Daniels accuses Select Portfolio of using false or misleading representations in connection with the collection of a debt, in violation of the FDCA and the Florida Consumer Collection Practices Act, Fla. Stat. Ann. § 559.72.
Select Portfolio moved to dismiss, saying Daniels was attempting hold it liable for issuing mortgage statements that are required under the Truth in Lending Act.
U.S. District Judge James S. Moody Jr. agreed and dismissed the suit in December 2018. Daniels v. Select Portfolio Servs. Inc., No. 18-cv-1652, (M.D. Fla. Dec. 18, 2018).
Judge Moody said that any discrepancies in language between Select Portfolio’s monthly statements and what is required under TILA “do not take the statements out of the realm of a monthly mortgage statement and into the realm of debt collection communications.”
On appeal, Daniels argued that compliance with TILA does not make a mortgage servicer immune from suit under the FDCPA and, even if it did, the monthly statements at issue included language beyond what is necessary under TILA.
Kaelyn S. Diamond and Michael A. Ziegler of the Law Office of Michael A. Ziegler represented Daniels.
Benjamin B. Brown and Joseph T. Kohn of Quarles & Brady LLP represented Select Portfolio.
By Dave Embree
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Appellate Circuit
Deutsche Bank and Nationstar Watch as 11th Circuit Discharge the Shotgun Despite Hunt’s Pleadings
There can be no doubt that this is a frivolous appeal and we would not hesitate to order sanctions if appellant had been represented by counsel.
Hunt v. Nationstar Mortg., No. 21-10398
(11th Cir. May 27, 2022)
MAY 27, 2022 | REPUBLISHED BY LIT: MAY 30, 2022
Before ROSENBAUM, GRANT, and MARCUS, Circuit Judges. PER CURIAM:
Christopher M. Hunt, Sr., proceeding pro se, appeals following the district court’s dismissal of his civil complaint arising out of his 2006 purchase of residential property located in Atlanta, Georgia (the “Property”).
Hunt purchased the Property using proceeds from a loan that he eventually defaulted on, which prompted Nationstar Mortgage, LLC (“Nationstar”), then servicer of the loan, to seek a non-judicial foreclosure on the Property.
After filing or being named in a variety of related lawsuits,1 Hunt filed the instant pro se complaint in Georgia state court in June 2020 and named as defendants Nationstar, the Deutsche Bank National Trust
1 See, g., Hunt v. Nationstar Mortg., LLC, 684 F. App’x 938 (11th Cir. 2017) (unpublished) (“Hunt I”);
[MARCUS, ROSENBAUM AND ANDERSON]
Hunt v. Nationstar Mortg., LLC, 779 F. App’x 669 (11th Cir. 2019) (unpublished);
[PRYOR,W., GRANT AND ANDERSON]
Hunt v. Nationstar Mortg., LLC, 782 F. App’x 762 (11th Cir. 2019) (unpublished);
[PRYOR,W., GRANT AND ANDERSON]
Deutsche Bank Tr. Co. Am., as Tr. for Fifteen Piedmont Ctr. v. Hunt, 783 F. App’x 998 (11th Cir. 2019) (unpublished).
[TJOFLAT, JORDAN AND NEWSOM]
Companies (“Deutsche Bank”), and Jay Bray, the CEO of Nationstar.
He alleged that they had committed, inter alia, mortgage fraud and wrongful foreclosure in violation of federal laws, including the Sarbanes-Oxley Act and the Dodd-Frank Act.2
The district court denied a variety of preliminary motions filed by Hunt;
dismissed, without prejudice, the complaint as to defendant Bray for failure to effect proper service;
and
dismissed, with prejudice, the complaint as to Deutsche Bank and Nationstar, because it was a “shotgun” pleading, was barred by res judicata, and failed to state a claim upon which relief could be granted.3
After thorough review, we affirm.
I.
Whether a court has subject-matter jurisdiction, including removal jurisdiction, is a question of law that we review de novo.
See McGee v. Sentinel Offender Servs., LLC, 719 F.3d 1236, 1241 (11th Cir. 2013).
We also review de novo a denial of a motion to
2 Sarbanes-Oxley Act of 2002, Pub. L. No. 107-204, 116 Stat. 745 (hereinafter “Sarbanes-Oxley Act”), and the Dodd-Frank Wall Street Reform and Con- sumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376 (2010) (hereinafter “Dodd-Frank Act”).
3 Hunt also named Christian Sewing, the Chief Executive Officer (“CEO”) of Deutsche Bank, as a defendant, but he later voluntarily dismissed him.
And after filing the complaint, Hunt sought to add yet another defendant, the Albertelli Law Firm (“Albertelli Law”).
Bray, Sewing and Albertelli Law have not filed any briefs on appeal.
remand to state court. Conn.
State Dental Ass’n v. Anthem Health Plans, 591 F.3d 1337, 1343 (11th Cir. 2009).
A district court’s decision regarding the indispensability of a party is reviewed for abuse of discretion.
United States v. Rigel Ships Agencies, Inc., 432 F.3d 1282, 1291 (11th Cir. 2005).
We will disturb a district court’s refusal to change venue only for a clear abuse of discretion.
Robinson v. Giarmarco & Bill, P.C., 74 F.3d 253, 255 (11th Cir. 1996).
We also review the district court’s denial of a motion for recusal for abuse of discretion.
Jenkins v. Anton, 922 F.3d 1257, 1271 (11th Cir. 2019).
We review a district court’s grant of a motion to dismiss for insufficient service of process, under Rule 12(b)(5), by applying a de novo standard to questions of law, and a clear error standard to the court’s findings of fact.
Albra v. Advan, Inc., 490 F.3d 826, 829 (11th Cir. 2007).
But when a party fails to object to a magistrate judge’s findings or recommendations in a report and recommendation, he “waives the right to challenge on appeal the district court’s order based on unobjected-to factual and legal conclusions.” 11th Cir. R. 3-1.
Under the circumstances, we review a claim on appeal only “for plain error,” if “necessary in the interests of justice.” Id.
We review the dismissal of a “shotgun” pleading under Rule 8 for abuse of discretion.
Vibe Micro, Inc. v. Shabanets, 878 F.3d 1291, 1294 (11th Cir. 2018).
When appropriate, we will review a district court’s dismissal for failure to state a claim under Rule 12(b)(6) de novo.
Am. United Life Ins. Co. v. Martinez, 480 F.3d 1043, 1056–57 (11th Cir. 2007).
We will also review a dismissal
REWIND 2022-2008 IS STILL HAPPENIN’ – FREQUENTLY – THE GREATEST THEFT OF HOMES IN HISTORY
Deutsche Bank /PHH Ocwen case frozen in time after LIT article was published, highlighting the homeowner’s plea to jurisdiction. https://t.co/IsKUrHZ84n @dwnews @ewarren @RandPaul #txlege— lawsinusa (@lawsinusa) May 29, 2022
based on res judicata de novo.
Jang v. United Techs. Corp., 206 F.3d 1147, 1149 (11th Cir. 2000).
We review de novo a district court’s conclusions on collateral estoppel, but review its legal conclusion that an issue was actually litigated in a prior action for clear error.
Richardson v. Miller, 101 F.3d 665, 667–68 (11th Cir. 1996).
While pro se pleadings are liberally construed, issues not briefed on appeal are normally forfeited and we will generally not consider them.
Timson v. Sampson, 518 F.3d 870, 874 (11th Cir. 2008).
An appellant can abandon a claim by:
(1) making only passing reference to it;
(2) raising it in a perfunctory manner without supporting arguments and authority;
(3) referring to it only in the “statement of the case” or “summary of the argument”;
or
(4) referring to the issue as mere background to the appellant’s main arguments.
Sapuppo v. Allstate Floridian Ins. Co., 739 F.3d 678, 681– 82 (11th Cir. 2014).
In addition, if a district court’s order rested on two or more independent, alternative grounds, the appellant must challenge all of the grounds to succeed on appeal.
See id. at 680.
When an appellant fails to challenge on appeal one of the grounds on which the district court based its judgment, he is deemed to have abandoned any challenge of that ground, and it follows that the judgment is due to be affirmed.
See id.
II.
Liberally construed, Hunt’s brief on appeal seeks to challenge the district court’s decisions:
(1) denying remand of his case to state court
and
denying his request to file an amended complaint adding another defendant, Albertelli Law;
(2) denying his request
to transfer the case;
(3) denying his request to disqualify the judge;
(4) dismissing, without prejudice, his complaint as to defendant Bray for failure to effect proper service;
and
(5) dismissing his complaint, with prejudice, as to Deutsche Bank and Nationstar.
To be sure, Hunt’s arguments about these decisions by the district court are not clearly stated.
But even if we were to assume that he has preserved his arguments on appeal, they fail on the merits.
First, we are unpersuaded by Hunt’s arguments that the district court should have allowed him to file an amended complaint to add another party to the suit, which would have deprived the federal court of jurisdiction, and should have remanded the case to state court.
Federal courts have diversity-of-citizenship jurisdiction when the parties are citizens of different states and the amount in controversy exceeds $75,000.
28 U.S.C. § 1332(a)(1).
A corporation is a citizen of every state where it was incorporated and the one state in which it has its principal place of business.
Daimler AG v. Bauman, 571 U.S. 117, 133, 137 (2014); 28 U.S.C. § 1332(c)(1).
A defendant may remove any civil action brought in a state court to a federal district court that has original jurisdiction over the action.
28 U.S.C. § 1441(a).
The removing party bears the burden of proving that removal jurisdiction exists.
McGee, 719 F.3d at 1241.
Here, the district court did not err in denying Hunt’s motion to remand. As we’ve held in a previous appeal, his motion was based on his belated and fraudulent attempts to join Albertelli Law, in an effort to defeat the district court’s diversity jurisdiction.
See Hunt I, 684 F. App’x. at 942-44.
However, Hunt asserted federal
Post Edited: Homeowner Announces Victory in Florida Against Wrongful Foreclosure, Quietly Affirmed on Appeal https://t.co/hXyc88iJ2o
— LawsInTexas (@lawsintexasusa) January 29, 2022
claims in his complaint, so the district court had jurisdiction in any event.
28 U.S.C. § 1441(a).
Accordingly, the district court correctly denied Hunt’s requests to remand the case and acted within its discretion to deny joinder.
Rigel Ships Agencies, Inc., 432 F.3d at 1291.
We also find no merit to Hunt’s claims that the district court should have transferred venue of his lawsuit.
A district court may transfer a civil action to any other district or division where it may have been brought “for the convenience of the parties and witnesses, and in the interest of justice.”
Robinson, 74 F.3d at 260 (quoting 28 U.S.C. § 1404(a)).
But in this case, the district court did not err because Hunt did not provide any cognizable reason for a transfer.
It appears that Hunt’s transfer request was based on his belief that case law in the United States District Court for the Middle District of Georgia would be more favorable to him – which is not a legitimate reason for transfer.
See 28 U.S.C. § 1404(a).
Similarly, we reject Hunt’s argument that the district court judge should have recused himself.
A judge must sua sponte recuse himself “in any proceeding in which his impartiality might reasonably be questioned” or “
28 U.S.C. § 455(a), (b)(1).
“The test is whether an objective, disinterested, lay observer fully informed of the facts underlying the grounds on which recusal was sought would entertain a significant doubt about the judge’s impartiality.”
Parker v. Connors Steel Co., 855 F.2d 1510, 1524 (11th Cir. 1988).
“Ordinarily, a judge’s rulings in the same or a related case may not serve as
the basis for a recusal motion.”
McWhorter v. City of Birmingham, 906 F.2d 674, 678 (11th Cir. 1990).
“The judge’s bias must be personal and extrajudicial; it must derive from something other than that which the judge learned by participating in the case.”
Id.
“The exception to this rule is when a judge’s remarks in a judicial context demonstrate such pervasive bias and prejudice that it constitutes bias against a party. Mere friction . . . however, is not enough to demonstrate pervasive bias.”
Thomas v. Tenneco Packaging Co., 293 F.3d 1306, 1329 (11th Cir. 2002) (quotation marks omitted).
As the record before us makes clear, no “objective, disinterested, lay observer fully informed of the facts underlying” these circumstances “would entertain a significant doubt about the judge’s impartiality.”
Parker, 855 F.2d at 1524.
Accordingly, the district court did not abuse its discretion in denying Hunt’s request for recusal or disqualification.
Nor do we find any merit to Hunt’s argument that the district court erred in dismissing the complaint against defendant Bray for lack of proper service.
When a federal court is considering the sufficiency of process after removal, it does so by looking to the state law governing process.
See Usatorres v. Marina Mercante Nicaraguenses, S.A., 768 F.2d 1285, 1286 n.1 (11th Cir. 1985).
Georgia law provides that service made “outside the state” of Georgia is to be done “in the same manner as service is made within the state.”
O.C.G.A. § 9-10-94.
Under Georgia law, service on natural persons is to be made “personally, or by leaving copies thereof at the defendant’s dwelling house or usual place of abode with some
person of suitable age and discretion then residing therein, or by delivering a copy of the summons and complaint to an agent authorized . . . to receive service of process.”
O.C.G.A. § 9-11-4(e)(7).
Notably, Hunt does not dispute these proposed findings set forth by the magistrate judge’s Report and Recommendation (“R&R”), that Hunt:
(1) mailed service to Bray;
and
(2) completed “corporate service” on Deutsche Bank, which Hunt asserted was also effective to serve Bray.
11th Cir. R. 3-1.
But, as the district court determined, Georgia law applied here and required personal service in these circumstances.
Albra, 490 F.3d at 829; O.C.G.A. § 9-11-4(e)(7).
Bray therefore was not properly served under Georgia law, and, for that reason, the district court did not err in dis- missing Hunt’s suit without prejudice as to Bray.
Finally, we find no error in the district court’s denial of injunctive relief and its dismissal of Hunt’s complaint against the two remaining defendants, Nationstar and Deutsche Bank.
A district court has the inherent authority to control its docket and ensure the prompt resolution of lawsuits, which includes the ability to dismiss a complaint on “shotgun” pleading grounds.
Shabanets, 878 F.3d at 1295.
We have described four types of “shotgun” com- plaints:
(1) those containing multiple counts where each count adopts all allegations of all preceding counts;
(2) those replete with conclusory, vague, and immaterial facts not obviously connected to any particular cause of action;
(3) those that do not separate each cause of action or claim for relief into different counts;
and
(4) those asserting multiple claims against multiple defendants without
specifying which of the defendants are responsible for which acts or omissions, or which of the defendants the claim is brought against.
Weiland v. Palm Beach Cnty. Sheriff’s Off., 792 F.3d 1313, 1321–23 (11th Cir. 2015).
“Shotgun” pleadings violate Rule 8, which requires “a short and plain statement of the claim showing that the pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2), by failing to, in one degree or another, give the defendants adequate notice of the claims against them and the grounds upon which each claim rests.
Shabanets, 878 F.3d at 1294–96.
We generally require district courts to allow a litigant at least one chance to remedy any deficiencies before dismissing the complaint with prejudice, where a more carefully drafted complaint might state a claim.
See id.; Silberman v. Miami Dade Transit, 927 F.3d 1123, 1132 (11th Cir. 2019).
But it need not grant leave to amend the complaint when further amendment would be futile.
Silberman, 927 F.3d at 1133.
Under federal law, res judicata, or claim preclusion, bars a subsequent action if
“(1) the prior decision was rendered by a court of competent jurisdiction;
(2) there was a final judgment on the merits;
(3) the parties were identical in both suits;
and
(4) the prior and present causes of action are the same.”
Jang, 206 F.3d at 1148– 49 & n.1 (quotation marks omitted).
We have held that “if a case arises out of the same nucleus of operative facts, or is based upon the same factual predicate, as a former action, the two cases are really the same ‘claim’ or ‘cause of action’ for purposes of res judicata.”
Baloco v. Drummond Co., Inc., 767 F.3d 1229, 1247 (11th
Cir. 2014) (quotation marks omitted and alterations adopted).
“In addition, res judicata applies not only to the precise legal theory presented in the prior case, but to all legal theories and claims arising out of the nucleus of operative fact” that could have been raised in the prior case.
Id. (quotation marks omitted and alterations adopted).
Collateral estoppel, or issue preclusion, “refers to the effect of a judgment in foreclosing relitigation of a matter that has been litigated and decided.”
Migra v. Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75, 77 n.1 (1984).
Thus, “collateral estoppel is appropriate only when the identical issue has been fully litigated in a prior case.”
In re McWhorter, 887 F.2d 1564, 1567 (11th Cir. 1989) (quotation marks omitted).
“The party seeking to invoke collateral estoppel bears the burden of proving that the necessary elements have been satisfied.”
Id. at 1566.
“[C]hanges in the law after a final judgment [generally] do not prevent the application of res judicata and collateral estoppel, even though the grounds on which the decision was based [may be] subsequently overruled.”
Precision Air Parts, Inc. v. Avco Corp., 736 F.2d 1499, 1503 (11th Cir. 1984).
To safeguard investors in public companies and restore trust in the financial markets, Congress enacted the Sarbanes-Oxley Act of 2002, 116 Stat. 745.
See S. Rep. No. 107-146, pp. 2–11 (2002).
The Act contains several provisions, including a whistleblower protection provision which prohibits a publicly traded company or its officers from discharging an “employee” for providing information to a supervisory authority about conduct that the employee
“reasonably believes” constitutes a violation of federal laws against mail fraud, wire fraud, bank fraud, securities fraud, any SEC rule or regulation, or any provision of federal law relating to fraud against shareholders.
See 18 U.S.C. § 1514A(a)(1).
The Dodd-Frank Act whistleblower provision provides protection to individuals who provide “information relating to a violation of the securities laws to the” Securities and Exchange Commission (“SEC”).
15 U.S.C. § 78u-6(a)(6).
Thus, “[t]o sue under Dodd-Frank’s anti-retaliation provision, a person must first provide information relating to a violation of the securities laws to the [SEC].”
Dig. Realty Trust, Inc. v. Somers, 138 S. Ct. 767, 772–73 (2018) (quotation marks omitted and alterations adopted).
In his brief on appeal, Hunt does not expressly address the lower court’s “shotgun” pleading determination, and, as a result, the district court’s dismissal of the complaint is due to be affirmed.
Sapuppo, 739 F.3d at 681–82.
But in any event, the district court did not err in finding that his complaint was a “shotgun” pleading.
As the record reflects, the complaint consisted of three numbered paragraphs that spanned paragraphs and pages; failed to isolate claims by defendants;
and largely failed to discuss any facts — thereby falling into several of our identified categories of prohibited “shotgun” pleadings.
Weiland, 792 F.3d at 1321-23.
The district court also was correct that amendment would have been futile.
For one, res judicata and collateral estoppel barred Hunt’s claims for breach of contract and fraud, since Hunt sued the same parties for the same alleged breach of contract and fraud in several prior cases.
See, e.g., Hunt I, 684 F. App’x at 944.4
These decisions were final judgments and were “rendered by a court of competent jurisdiction,” “on the merits,” against the same parties, and “the prior and present causes of action [were] the same.”
Jang, 206 F.3d at 1149.
Moreover, even if some of Hunt’s claims had not been explicitly presented in any of his prior cases, they would still be barred by res judicata because every claim arose from the same facts as each of his prior cases, and he could have raised them in any of the prior proceedings.
Baloco, 767 F.3d at 1247.
Also, despite Hunt’s arguments, there have been no “changes in the law” that would “prevent the application of res judicata and collateral estoppel” in this case.
Precision Air Parts, 736 F.2d at 1503.
In addition, Hunt’s claims under the Sarbanes-Oxley Act and Dodd-Frank Act were futile because they fail to state a claim upon which relief could be granted.
As the record reflects, Hunt did not allege that he was an “employee” under the Sarbanes-Oxley Act, nor that he “provide[d] information relating to a violation of the securities laws to the [SEC]” as required under the Dodd-Frank Act.
4 To the extent that Hunt challenges the district court’s decisions under Fed. R. Civ. P. 60(b), we conclude that he has not identified any “extraordinary circumstances” entitling him to relief, and the district court did not abuse its discretion in this respect.
Toole v. Baxter Healthcare Corp., 235 F.3d 1307, 1316 (11th Cir. 2000) (quotation marks omitted).
Somers, 138 S. Ct. at 772–74.
Accordingly, Hunt did not state a cause of action under these statutes, and we affirm.
AFFIRMED.5
5 All of Hunt’s pending motions, which he filed after we imposed a filing restriction on him, are DENIED to the extent they request any relief.
For their part, Nationstar and Deutsche Bank have filed renewed motions for sanctions, requesting monetary sanctions against Hunt for his numerous motions before this Court under 11th Cir. R. 27-4.
Hunt is pro se and we DENY the motions for sanctions at this time.
See Woods v. I.R.S., 3 F.3d 403, 404 (11th Cir. 1993)
(“There can be no doubt that this is a frivolous appeal and we would not hesitate to order sanctions if appellant had been represented by counsel. However, since this suit was filed pro se, we conclude that sanctions would be inappropriate.”).
Although we are reluctant to impose sanctions on pro se appellants, we warn Hunt that our Court has imposed sanctions in circumstances like these, even for pro se litigants, and he is strongly cautioned against bringing any further frivolous motions or claims.
See Ricket v. United States, 773 F.2d 1214, 1216 (11th Cir. 1985)
(imposing sanctions on a pro se appellant who had been warned by the district court that the issues on appeal were frivolous).
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Appellate Circuit
God Goes in Front of Me and Makes the Crooked Straight and I Get to Keep My Pension
Ex-Inmate and Former Congresswoman Corrine Brown is Confident of Her Plea Deal Keepin’ Her out of Jail and Ending Her Criminal Case.
Former congresswoman Corrine Brown Update
JUL 28, 2024
On May 17, 2022, Corrine Brown pleaded guilty on the charges to avoid a second trial.
Former Congresswoman Brown was sentenced to the time that she had already served in the custody of the Federal Bureau of Prisons, specifically two years, eight months, and nine days.
Brown was also ordered to pay $62,650.99 in restitution to the Internal Revenue Service.
As of June 2024, the former member of Congress from Northeast Florida is looking for an interest-free payment plan for her federal debt. If accepted by the court, it sets the stage for Brown on the installment plan past her 82nd birthday.
Former congresswoman Corrine Brown to take plea deal
Brown faced retrial this fall on federal fraud charges
May 17, 2021 | REPUBLISHED BY LIT: May 17, 2022
JACKSONVILLE, Fla. – Former congresswoman Corrine Brown is set to change her plea Wednesday in a federal case that involves charges of fraud and conspiracy, avoiding a retrial that was scheduled to take place this fall.
Tuesday morning, News4JAX reporter Jim Piggott spoke with Corrine Brown by phone. She said everything will come out in court tomorrow.
“I want you to know, God has been good to me,”
Brown said.
“I just talked to my pastor and I know that He goes in front of me and make the crooked straight. That’s all I can tell you, He’s good.”
Former U.S. Rep. Corrine Brown is set to change her plea Wednesday in a federal case that involves charges of fraud and conspiracy, avoiding a retrial that was scheduled to take place this fall.
Brown was indicted in 2016 on charges that included conspiracy, wire fraud, and tax fraud, on accusations that she used contributions to the One Door for Education charity for personal expenses.
Brown was convicted on some of the charges in May 2017, and began a five-year prison sentence in January 2018. Brown was released in April 2020, due to coronavirus concerns.
Following her conviction, Brown appealed the guilty verdict, arguing the trial judge wasn’t justified in replacing a juror who said the Holy Spirit told him Brown was not guilty.
A three-judge panel of the 11th Circuit of the U.S. Court of Appeals initially upheld Brown’s conviction.
Brown’s attorneys then asked for a rehearing before the full 11th Circuit, known as an “en banc” hearing. In May 2021, the appellate court reversed the conviction with a 7-4 decision, sending the case back to the district court for a potential retrial.
In October 2021, we learned that prosecutors planned to re-try Brown on the felony counts she faced in her 2017 trial.
At the time, we learned prosecutors had already extended her a plea deal to avoid being retried and the possibility of a return to prison, an offer she rejected at the time.
Following the appointment of a new defense team, Brown’s retrial was set to take place in September of 2022.
News4JAX Jim Piggott spoke with attorney Curtis Fallgatter,
“(Jim) Are you surprised at all?
(Curtis) A little bit, but not terribly because of the age of the case, the complexity of the case, the number of issues, reversal on appeal issues about a retrial, can I get a conviction, the age of Brown.”
The court document indicating that Brown will be changing her plea does not indicate what charges she may be pleading guilty to, or what sentence could potentially be imposed.
Fallgatter doesn’t believe Brown will serve any additional time.
He said she would not agree to that, and the agreement should be an end to the case.
Brown is getting her pension, and that likely will not change.
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• Continue to provide this website, content, resources, community and help center for free to the many homeowners, residents, Texans and as we’ve expanded, people nationwide who need access without a paywall or subscription.
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Thank you for your trust, belief and support in our conviction to help Floridian residents and citizens nationwide take back their freedom. Your Donations and your Voice are so important.
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