United States District Court, N.D. Indiana, South Bend Division
OPINION AND ORDER
L. Miller, Jr. Judge
Saunders filed a pro se complaint alleging various
federal and state law causes of action against Select
Portfolio Servicing, Inc. and U.S. Bank National Association
stemming from what she describes as a wrongful foreclosure.
The defendants moved to dismiss the complaint under Federal
Rule of Civil Procedure 12(b)(1), arguing that the
Rooker-Feldman doctrine deprives the court of
subject matter jurisdiction over Ms. Saunders's claims
and under Rule 12(b)(6), contending that the court should
give preclusive effect to the state court's foreclosure
proceedings. [Doc. No. 10]. For the following reasons, the
court grants in part and denies in part the motion to
2017, Ms. Saunders acquired sole possession and ownership of
property following her grandmother's death, but had
difficulty establishing successorship with the mortgage
servicer, Select Portfolio Servicing. Before she could
establish successorship, she received a notice of default and
acceleration and U.S. Bank National Association, acting as
trustee for the mortgage holder, filed a foreclosure action
in Cass County court. On July 27, 2018, while the foreclosure
action was still pending, Ms. Saunders filed this action in
federal court alleging state law claims based on a wrongful
foreclosure action and that Select Portfolio Servicing
violated federal regulations. On August 3, the state court
held a hearing on U.S. Bank's motion for summary
judgment, at which Ms. Saunders argued against the
foreclosure. The court granted the motion the same day, and
entered a foreclosure decree.
proceedings to the merits of the motion to dismiss, the court
must resolve two motions related to Ms. Saunders's
sur-reply. After the defendants filed a reply brief in
support of their motion that included a new exhibit-a
transcript of the Cass County court's hearing on the
summary judgment motion-and addressed the hearing for the
first time, Ms. Saunders filed a sur-reply. [Doc. No. 16].
The defendants moved to strike the sur-reply, arguing Ms.
Saunders hadn't sought or been granted leave to file it.
[Doc. No. 17]. Ms. Saunders responded by filing a motion for
leave to file a sur-reply and attached her proposed
sur-reply. [Doc. No. 18]. The defendants didn't respond
to Ms. Saunders's motion.
generally disfavor sur-replies but have discretion to allow
them “to address new arguments or evidence raised in
the reply brief.” Thompson v. City of
Indianapolis, No. 115CV01712TWPDML, 2017 WL 1546316, at
*2 (S.D. Ind. Apr. 28, 2017). Because the defendants included
a new exhibit with their reply brief, the court will consider
Ms. Saunders's sur-reply and, accordingly, denies the
motion to strike and denies Ms. Saunders's motion for
leave to file a sur-reply as unnecessary.
their motion to dismiss, the defendants first argue that the
court should dismiss this case pursuant to Rule 12(b)(1),
asserting that Ms. Saunders's complaint seeks to set
aside a state court judgment and decree of foreclosure
entered against her by the Cass County Circuit Court. The
defendants contend that the Rooker-Feldman doctrine
deprives the court of subject matter jurisdiction over all of
her claims because she seeks review of a state court
federal court must assure itself that it has jurisdiction
over the subject matter of a case - the power to hear and
decide it -- before it can proceed to take any action on the
merits. See Warth v. Seldin, 422 U.S. 490, 498
(1975); Craig v. Ontario Corp., 543 F.3d 872, 875
(7th Cir. 2008). Rule 12(b)(1) authorizes dismissal of
complaints that bring no actionable claim within the subject
matter jurisdiction of the federal courts. In reviewing a
motion under Rule 12(b)(1), the court must “accept as
true all well-pleaded factual allegations and draw all
reasonable inferences in favor of the plaintiff, ” yet,
if necessary, may “look beyond the jurisdictional
allegations of the complaint and view whatever evidence has
been submitted on the issue to determine whether in fact
subject matter jurisdiction exists.” St. John's
United Church of Christ v. City of Chicago, 502 F.3d
616, 625 (7th Cir. 2007) (internal quotations and citation
omitted). The party asserting jurisdiction bears the burden
of demonstrating subject matter jurisdiction by competent
proof. Thomas v. Gaskill, 315 U.S. 442, 446 (1942);
Sprint Spectrum L.P. v. City of Carmel, Ind., 361
F.3d 998, 1001 (7th Cir. 2004). A court must dismiss an
action without reaching the merits if there is no
jurisdiction. Sinochem Int'l Co. Ltd. v. Malaysia
Int'l Shipping Corp., 549 U.S. 422, 430-431 (2007).
federal courts are not vested with appellate authority over
state courts.” Sykes v. Cook Cty. Circuit Court
Prob. Div., 837 F.3d 736, 741 (7th Cir. 2016) (citations
omitted). The Rooker-Feldman doctrine “is a
rule of federal jurisdiction, ” Frederiksen v. City
of Lockport, 384 F.3d 437, 438 (7th Cir. 2004), that
“deprives federal courts of subject matter jurisdiction
where a party . . . sues in federal court seeking to set
aside the state court judgment and requesting a remedy for an
injury caused by that judgment.” Johnson v.
Orr, 551 F.3d 564, 568 (7th Cir. 2008).
Saunders argues that the Rooker-Feldman doctrine
doesn't apply because she filed her complaint on July 27,
2018, a week before the Cass County court entered the
foreclosure decree. The court agrees. According to the
Supreme Court, the Rooker-Feldman doctrine “is
confined to cases . . . brought by state-court losers
complaining of injuries caused by state-court judgments
rendered before the district court proceedings
commenced and inviting district court review and
rejection of those judgments.” Exxon Mobil Corp. v.
Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005)
(emphasis added). See also TruServ Corp. v. Flegles,
Inc., 419 F.3d 584, 591 (7th Cir. 2005) (quoting
Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544
U.S. at 291) (the Rooker-Feldman “only applies
to cases like Rooker and Feldman where
‘the losing party in state court filed suit in federal
court after the state proceedings ended'
”) (emphasis supplied). In their reply brief, the
defendants recognize that Ms. Saunders filed this case before
the state court judgment and decree was entered, but
don't address Exxon Mobil Corp. v. Saudi Basic Indus.
Corp. and its progeny.
Ms. Saunders filed this case before the Cass County court
entered its judgment and decree of foreclosure, the
Rooker-Feldman doctrine doesn't apply and the
court can't dismiss the case for want of jurisdiction.
See Exxon Mobil Corp. v. Saudi Basic Indus. Corp.,
544 U.S. at 284.