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Fauley v. Mosman

United States District Court, D. Oregon, Portland Division

February 1, 2018




         THIS MATTER comes before the Court on Defendants Erick J. Haynie, Gabrielle D. Richards, Jeffrey M. Peterson, and Perkins Coie LLP's (“Defendant attorneys and law firm”) Motion to Dismiss. Dkt. 16. The Court has reviewed the pleadings filed regarding the motion, the remaining file, and is fully advised.

         Filed on October 18, 2017, the Civil Rights Complaint in this case asserted 42 U.S.C. § 1983 and fraud claims against two U.S. District Court Judges, Michael Mosman and Marco Hernandez, who presided over cases involving the pro se Plaintiff, Robynne Fauley, and the three attorneys and law firm, who filed the judicial foreclosure case, LNV Corp. v. Fauley, U.S. District Court for the District of Oregon case number 3:15-cv-01422-HZ, against Ms. Fauley for LNV Corp. Dkt. 1. On November 3, 2017, all claims asserted against Defendant Judges Mosman and Hernandez were dismissed with prejudice. Dkt. 13.

         The Defendant attorneys and law firm now move for dismissal of the claims asserted against them and for an award of attorneys' fees and costs. Dkt. 13. For the reasons provided herein, all claims asserted against the Defendant attorneys and law firm should be dismissed, and attorneys' fees and costs awarded.



         As it related to Judge Mosman, Ms. Fauley's Complaint referenced Fauley v. Washington Mutual Bank FA, et al., U.S. District Court for the District of Oregon case number 3:13-cv-00581-MO (“Washington Mutual case”). Dkt. 1, at 2-9. Judge Mosman was the district court judge assigned to the case, with a temporary referral to a magistrate judge. Id. The case arose from Ms. Fauley's dispute with various loan servicers related to a mortgage on property commonly known as 12125 SE Laughing Water Road, Sandy, OR 97055 (“subject property”). Washington Mutual case, Dkts. 1 and 33. After appointment of counsel for the limited purpose of helping her file a proposed amended complaint, on November 4, 2014, Judge Mosman granted the Defendants' motions to dismiss, and the case was dismissed with prejudice for failure to state a claim and without leave for further amendment. Washington Mutual case, Dkt. 73. The case was closed. Id. Ms. Fauley's motion for relief from the judgment was denied on August 4, 2015. Washington Mutual case, Dkt. 91. Ms. Fauley did not file an appeal.

         The Complaint in this case also discussed Judge Mosman's decisions in Subramaniam v. Beal, U.S. District Court for the District of Oregon case number 3:12-cv-01681-MO (a case between Denise Subramaniam and various loan servicers) and LNV Corporation v. Subramaniam, U.S. District Court for the District of Oregon case number 3:14-cv-01836-MO (a judicial foreclosure case that did not involve Ms. Fauley).

         As it related to the claims against Judge Hernandez, the Complaint referenced a judicial foreclosure case over which Judge Hernandez presided, LNV Corporation v. Fauley, U.S. District Court for the District of Oregon case number 3:15-cv-01422-HZ (“LNV case”), against Ms. Fauley. Dkt. 1. On April 18, 2016, summary judgment was granted in the lender's (LNV Corporation) favor and against Ms. Fauley. LNV case, Dkt. 52. After Ms. Fauley filed for Chapter 13 bankruptcy relief and then voluntarily dismissed her bankruptcy petition, judgment was entered against her on July 18, 2016. LNV case, Dkts. 54, 58-1, 58-2, and 65. On July 25, 2016, Ms. Fauley appealed the summary judgment decision and judgment to the Ninth Circuit Court of Appeals. LNV case, Dkt. 71.

         On October 6, 2017, the Ninth Circuit Court of Appeals issued a Memorandum Opinion, affirming the district court's summary judgment decision and the judgment against Ms. Fauley. LNV Corporation v. Fauley, Ninth Circuit Court of Appeals case number 16-35593, Dkt. 58. The mandate has not yet issued.


         In her Complaint, Ms. Fauley asserts that she is the rightful owner of the subject property. Dkt. 1, at 4. She maintains that Judges Mosman and Hernandez are “not being sued in [their] capacity as a judge[s] but as a private citizen[s].” Dkt. 1, at 2. Ms. Fauley claims that she and Ms. Subramaniam are “members of a class;” and “represent members of that class but because they are pro se litigants they are treated differently than litigants represented by counsel.” Id., at 3. In a pleading that appears to be, at least in part, a duplicate of one Ms. Subramaniam filed in Subramaniam v. Richards, U.S. District Court for the District of Oregon case number 3:17-cv-1627-RJB, Ms. Fauley maintains that Judges Mosman and Hernandez “deprived [her] of her constitutional rights to due process of law and equal protection of law by acting in opposition to their constitutionally mandated oaths of office specific to their summary decisions.” Id. She asserts that the “summary decisions were not based on the Constitution and laws of the United States but on their personal biases against [Ms. Fauley] and Ms. Subramaniam as members of a class of homeowners defending their property rights against the false claims of wealthy politically powerful corporate litigants.” Id. Ms. Fauley maintains that the summary decisions are “null and void.” Id.

         Ms. Fauley further asserts that the lawyers in the judicial foreclosure case of the subject property (LNV Corp. v. Fauley, U.S. District Court for the District of Oregon case number 3:15-cv-01422-HZ) Defendants Richards, Haynie, and Peterson, all filed false documents and “the perjured declaration of MGC employee and Texas attorney Grant Adam Hamilton, ” which was “false in all respects.” Dkt. 1, at 9. She asserts that these lawyers' “intent for the material misrepresentations in this declaration was to win summary judgment by fraud; which they did.” Id.

         Ms. Fauley makes a claims for damages against under §1983 “for the deprivation of her constitutional rights, privileges, and immunities secured by the Constitution and laws of the United States” and for fraud. Id., at 10. She asserts that all Defendants conspired together. Id.


         The undersigned was assigned to this case on October 26, 2017. Dkt. 11.

         In their motion to dismiss, the Defendant attorneys and law firm assert that Plaintiff has failed to allege sufficient facts to support a § 1983 claim against them because they did not deprive her of a constitutional right and are not state actors. Dkt. 16. To the extent that Plaintiff asserts a fraud claim against them, Defendants maintain that they are immune from liability under Oregon law and that, in any event, Plaintiff failed to plead fraud with particularity and so the claim should be dismissed. Id. Further, Defendants assert that Plaintiff's fraud claim is a “SLAPP” suit, which, under Oregon law, O.R.S. 31.150, should be dismissed and the Defendants should be awarded reasonable attorneys' fees and costs, in accord with their “special motion to strike.” Id.

         The Court issued a warning to Plaintiff regarding the motion to dismiss. Dkt. 17.

         Plaintiff filed a response to the motion to dismiss. Dkt. 23. In her response, Plaintiff maintains that the Court erred in dismissing her claims against Judges Mosman and Hernandez because she has asked the U.S. Supreme Court whether Fed.R.Civ.P. 12 (b)(6) and Rule 56 are unconstitutional. Id. She again asserts that the judges used those rules to deprive her of a trial by jury. Id. Plaintiff argues that “judicial immunity is not absolute, ” because they acted outside the function of a judge when they improperly granted the motions. Id. Plaintiff again asserts that the note and other documents used in both cases (in the Washington Mutual case and LNV case) were “false documents.” Id. Plaintiff references several other cases involving LNV Corporation, other banks, and mortgage companies, and asserts that all these cases are related to her case because they involved homeowners (who were often pro se), mortgages, fraudulent documents, and/or the use of motions to dismiss (Rule 12) or summary judgement motions (Rule 56) to dispose of the cases. Id. Plaintiff also points to a civil action brought by several attorneys general against various banks regarding their lending practices and, points to a criminal proceeding against Loraine Brown in an attempt to show that the documents used in Plaintiff's foreclosure case (the LNV case) were fraudulent. Id. (Plaintiff's motions for judicial notice regarding these cases and other matters were stricken as irrelevant on January 29, 2018. Dkt. 49.) Plaintiff asserts that the Defendant lawyers and law firm knew or should have known that the documents offered were not genuine mortgage instruments (in part because of the other nationwide litigation), and so committed fraud. Id. Plaintiff maintains that the attorneys are not entitled to any privilege, and then discusses the crime-fraud exception to the attorney client privilege. Id. Plaintiff also argues that her fraud claim is not a “SLAPP” suit, and even if it was, she asserts the statute may not be constitutional. Id. Plaintiff also filed her “Declaration of Robynne Fauley in Support of Plaintiff's Response in Objection to Defendants' Motion to Dismiss.” Dkt. 27.

         On January 31, 2018, the Defendant attorneys and law firm replied and argued that they are entitled to dismissal of Plaintiff's claims because she has failed to state a claim under § 1983 and because they are entitled to immunity as to the fraud claim. Dkt. 51. They assert that Plaintiff failed to articulate a viable constitutional challenge to O.R.S. 31.150 and argue that none of the cases she cites support such a challenge. Id. Defendants lastly assert that the Court should not consider the exhibits attached to Plaintiff's response or her declaration because they are irrelevant, the documents are inadmissible because they have not been authenticated, and contain hearsay. Id.


         This opinion will first address Defendants' contention that the Court should not consider the exhibits attached to Plaintiff's response or her declaration. It will then address Defendants' motion to dismiss Plaintiff's constitutional and fraud claims. It will then turn to Defendants' motion to strike Plaintiff's fraud claim and their motion for attorneys' fees and costs both pursuant to Oregon's Strategic Lawsuit Against Public Participation (“Anti-SLAPP”) statute, O.R.S. 31.15, et. seq. Lastly, the opinion will address Plaintiff's further arguments regarding the propriety of dismissing the two federal judges from this case.



         To the extent possible, the Court considered Plaintiff's submissions, in part, to establish the background for this case. The Defendants properly point out that a majority of the exhibits offered are admissible and irrelevant. Further, there is extensive hearsay throughout the pleadings. The Court has already stricken almost 1, 000 pages of irrelevant pleadings. Dkt. 49.

         B. STANDARD ON ...

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