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William Villa; Villa Realty, Inc. Accion Mortgage v. Gretchen Heller; William Hellar

August 3, 2012

WILLIAM VILLA; VILLA REALTY, INC. ACCION MORTGAGE;
PATRICIA VILLA; AND ACCLAIM FINANCIAL SERVICES, INC.,
PLAINTIFFS,
v.
GRETCHEN HELLER; WILLIAM HELLAR;
DIANE HELLAR, HELLAR
CHARITABLE REMAINDER TRUST; STEPHANIE RUIZ;
MICHAEL LUSBY; COLLIN COOK; AMERICAN CONTRACTORS INDEMNITY COMPANY; AND DOES 1-7, DEFENDANTS.



The opinion of the court was delivered by: Hon. Anthony J. Battaglia U.S. District Judge

ORDER GRANTING DEFENDANT WILLIAM HELLAR'S MOTION FOR SUMMARY JUDGMENT; DENYING DEFENDANT WILLIAM HELLAR'S MOTION FOR SANCTIONS [Doc. Nos. 76, 80.]

Before the Court is Defendant William Hellar's motion for summary judgment filed on May 14, 2012. (Dkt. No. 76.) Plaintiffs William Villa, Patricia Villa, Acclaim Financial Services, Inc. and Villa Realty, Inc. filed an opposition on June 25, 2012. (Dkt. Nos. 86, 88, 89.) Defendant filed a reply on July 9, 2012. (Dkt. No. 93.) In addition, on May 22, 2012, Defendant William Hellar filed a motion for sanctions. (Dkt. No. 80.) Plaintiffs filed an opposition on July 3, 2012. (Dkt. No. 91.) Defendant filed a reply on July 16, 2012. (Dkt. No. 94.) The motions are submitted on the papers without oral argument, pursuant to Civil Local Rule 7.1(d)(1). After a thorough review of the papers, supporting documentation, and applicable law, the Court GRANTS Defendant William Hellar's motion for summary judgment and DENIES Defendant William Hellar's motion for sanctions.

Procedural Background

On September 9, 2010, Plaintiffs William Villa; Villa Realty, Inc. dba Accion Mortgage; Patricia Villa; and Acclaim Financial Services, Inc. ("AFSI") filed a complaint against Defendants Gretchen Heller; William Hellar; Diane Hellar, Hellar Charitable Remainder Trust; Stephanie Ruiz; Michael Lusby; Collin Cook; and American Contractors Indemnity Company ("ACIC") and Does 1-7.*fn1 Does 1-7 are identified as Defendants Lanak & Hanna, P.C.; Peter Carman; Adam Pessin; Randy Rinicella; William Whamond; Jeannie Kim; and Rajat Bhasin. (Compl. ¶¶ 11, 13.) On June 7, 2011, the Court granted Defendants Cook, ACIC, Peter Carman, Adam Pessin, Randy Rinicella, William Whamond, Jeannie Kim, Rajat Bhasin, and Lanak & Hanna's motion to dismiss; sua sponte dismissed certain claims against Defendants Michael Lusby, Gretchen Hellar, William Hellar; and Diane Hellar Hellar Charitable Remainder Trust; and denied moving Defendants' motion for sanctions. (Dkt. No. 52.) The remaining claim in the Complaint relevant to the instant motion for summary judgment is against Defendant William Hellar for a RICO violation when Hellar allegedly made false claims with the San Diego District Attorney and the San Diego Sheriff regarding elder abuse and made false claims to mortgage regulators at the California Department of Corporations. (Compl. ¶ 6(c)(ii).)

Factual Background

William Hellar traveled to San Diego to interview Defendant Stefanie Ruiz of BC Lending for potential business of purchasing promissory notes. (Dkt. No. 89, Marshall Decl., Ex. A, Hellar Depo. at 20:3-19; Dkt. No. 76-2, Ballesteros Decl., Ex. A, Hellar Depot. at 25:24-25.) Upon request, Ruiz presented her license which indicated that she was with "BC lending dba Acclaim Financial Services." (Dkt. No. 76-2, Ballesteros Decl., Ex. A, Hellar Depo. at 31:3-20; Ex. B, Villa Depo. at 193:14-18.) Hellar confirmed that her license was valid in California. (Id., Ex. A, Hellar Depo. at 31:8-13.) Hellar then called the principal of Acclaim who verified that Ruiz was authorized to do business for Acclaim and learned Villa got a "kickback" for each loan she sold. (Dkt. No. 76-2, Ballesteros Decl., Ex. A, Hellar Depo. at 32:1-10; 33: 12-25.) Hellar purchased a loan on the spot from her. (Id., Ex. A, Hellar Depo. at 51:18-22.)

Ruiz e-mailed Hellar and presented him with a new loan, the Kellar loan for $21,450. (Id., Ex. A, Hellar Depo. at 25:11-20; 45:18-46:2.) As to the Kellar loan, Ruiz asked Hellar to wire the money directly to her this one time since it was only $21,000. (Id. at 52:12-18; Ex. E.) Ruiz sent Hellar an e-mail stating that the loan documents were on the way to Hellar but the documents did not arrive and that was the last communication he received from her. (Id. at 50:13-51:12; Ex. D.)

Hellar contacted Villa and asked for the money. (Dkt. No. 76-2, Ballesteros Decl., Ex. A, Hellar Depo. at 65:21-66:2.) Villa told him that Ruiz would return the money the next day which did not happen. (Id.) Hellar continued to e-mail Mr. Villa in December 2007 and January 2008. (Id. at 66:9-16; 68:19-69:12.)

In January 2008, Hellar reported the incident to the San Diego Sheriff. (Dkt. No. 89, Marshall Decl., Ex. A, Hellar Depo. at 71:1-19.) He told the Sheriff that he was fearful that he had been defrauded out of his money by BC Lending and Villa. (Id.) Hellar also filed a complaint with the Department of Corporations regarding the misappropriation of his money. (Id. Ex. C.) The Hellars hired Attorney Michael Lusby and he filed a civil complaint in the San Diego Superior Court against the required $25,000 bond on Acclaim. (Dkt. No. 76-3, D's RJN No. 1.) Lusby made legal service on Villa via publication. (Id., RJN No. 3.) Lusby obtained a favorable judgment for the full $25,000. (Id., RJN No. 2.) In their opposition brief, Plaintiffs do not provide any factual background to support their opposition and have not provided any facts to directly dispute Defendant's facts.*fn2

Discussion

Plaintiffs allege a Racketeer Influenced and Corrupt Organizations Act ("RICO") claim against Defendant William Hellar. Specifically, Plaintiffs allege there were RICO violations when William Hellar allegedly made false claims with the San Diego District Attorney and the San Diego Sheriff alleging elder abuse and made false claims to mortgage regulators at the California Department of Corporations.*fn3 (Compl. ¶ 6.) As such, Plaintiffs claim their mortgage business has been harmed because of AFSI's inability to attract and retain clients due to the false allegations made by Plaintiffs. (Id. ¶ 15.)

A. Requests for Judicial Notice

Defendant filed a request for judicial notice as to nine documents. (Dkt No. 76-3.) These documents concern records from the San Diego Superior Court of California and this Court. (Id.) In their opposition, Plaintiffs also filed a request for judicial notice as to a Request for Dismissal filed in San Diego Superior Court (Dkt. No. 88.)

The Court may take judicial notice of facts that are "not subject to reasonable dispute that is either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." Fed. R. Evid. 201(b). A court may take judicial notice of court filngs and other matters of public record. Reyn's Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n. 6 (9th Cir. 2006). Both parties have not objected to each other's request for judicial notice. The Court concludes that these documents are appropriate for judicial notice. Accordingly, the Court GRANTS Defendant and Plaintiffs' requests for judicial notice.

B. Legal Standard Pursuant to Federal Rule of Civil Procedure 56

Federal Rule of Civil Procedure 56 empowers the Court to enter summary judgment on factually unsupported claims or defenses, and thereby "secure the just, speedy and inexpensive determination of every action." Celotex Corp. v. Catrett, 477 U.S. 317, 325, 327 (1986). Summary judgment is appropriate if the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). A fact is material when it affects the outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

The moving party bears the initial burden of demonstrating the absence of any genuine issues of material fact. Celotex Corp., 477 U.S. at 323. The moving party can satisfy this burden by demonstrating that the nonmoving party failed to make a showing sufficient to establish an element of his or her claim on which that party will bear the burden of proof at trial. Id. at 322-23. If the moving party fails to bear the initial burden, summary judgment must be denied and the court need not consider the nonmoving party's evidence. Adickes v. S.H. Kress & Co., 398 U.S. 144, 159-60 (1970).

Once the moving party has satisfied this burden, the nonmoving party cannot rest on the mere allegations or denials of his pleading, but must "go beyond the pleadings and by her own affidavits, or by the 'depositions, answers to interrogatories, and admissions on file' designate 'specific facts showing that there is a genuine issue for trial.'" Celotex, 477 U.S. at 324. If the non-moving party fails to make a sufficient showing of an element of its case, the moving party is entitled to judgment as a matter of law. Id. at 325. "Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no 'genuine issue for trial.'" Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). In making this determination, the court must "view[] the evidence in the light most favorable to the nonmoving party." Fontana v. Haskin, 262 F.3d 871, 876 (9th Cir. 2001). The Court does not engage in credibility determinations, weighing of evidence, or drawing of legitimate inferences from the facts; these functions are for the trier of fact. Anderson, 477 U.S. at 255.

C. Rooker-Feldman Doctrine

Defendant argues that the Rooker-Feldman doctrine bars Plaintiffs' allegations against him. Plaintiffs contend that the allegations against Hellar do not directly or indirectly challenge the state court judgment and is not a collateral attack on the judgment.

The Rooker-Feldman*fn4 doctrine prevents the lower federal courts from exercising subject matter jurisdiction over 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). Rooker-Feldman is a narrow doctrine and only applies in "limited circumstances." Lance v. Dennis, 546 U.S. 459, 464, 466 (2006) (citing Exxon Mobil, 544 U.S. at 291); Skinner v. Switzer, 131 S. Ct. 1290, 1297 (2011). District courts are courts of original, not appellate ...


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