United States District Court, E.D. California
ORDER RE: MOTIONS TO VACATE JUDGMENT AND TO PERMIT
SUBSTITUTION OF PARTY (DOCS. 67 AND 74)
Wells Fargo Bank foreclosed on Plaintiff Marsha Kilgore's
home in 2012-13. To challenge that process, Plaintiff
originally filed suit in state court. Defendant removed the
case to the Eastern District of California Fresno Division in
May 2012. Doc. 1. Plaintiff sought a temporary restraining to
stop the scheduled trustee's sale. Doc. 5. The TRO was
granted on June 13 and the court set up a hearing on July 2
to consider whether a more permanent preliminary injunction
should be granted. Doc. 6. Concurrently, Defendant filed a
motion to dismiss the suit with a hearing scheduled for July
23. Doc. 11. On June 29, the court vacated the July 2 hearing
and granted a preliminary injunction through July 23. Doc.
22. The July 23 hearing was vacated and the motion to dismiss
was taken under submission. Doc. 26. On July 31 at 3:10 PM,
the court issued an order granting the motion to dismiss;
Plaintiff was given 10 days to file an amended complaint.
Doc. 29. Further, the preliminary injunction was extended for
an additional 10 days in the interests of justice. Doc. 29.
next day, Defendant, through attorney Kenneth Franklin, filed
a notice in the court's docket that the trustee's
sale of the property took place at 10:40 AM on July 31,
before Defendant was aware of the court's order;
Defendant did state that it would request the trustee's
deed upon sale not be recorded until after August 10. Doc.
30. In response, Plaintiff filed an objection that June 29
preliminary injunction should have been interpreted to last
until the court issued an order on the motion to dismiss;
Plaintiff believed that Defendant had violated the injunction
in conducting a trustee's sale on July 31. Doc. 31. The
court did not issue any order that directly addressed
Defendant's sale or Plaintiff's assertion that the
injunction had been violated.
requested an additional seven days to file her amended
complaint. Doc. 33. The court granted the request, asking for
the amended complaint to be filed by August 17 and extending
the injunction until August 20. Doc. 36. Plaintiff filed her
amended complaint on August 17. Doc. 38. The injunction was
not extended beyond August 20. Defendant recorded the
trustee's deed upon sale on August 31. Doc. 67, 12:14-16;
Doc. 71, 5:7-9.
initiated an unlawful detainer action in state court.
Plaintiff filed for bankruptcy in December 2012 and this case
was stayed. Docs. 47 and 50. An unlawful detainer judgment
was granted in favor of Defendants on April 3, 2013. Facing
eviction, Plaintiff filed a request for a temporary
restraining order on May 1 in this court. Doc. 53. That
request was denied and the stay in this case lifted on May 6.
Doc. 57. Plaintiff's amended complaint was dismissed on
May 24 and the case closed. Doc. 58.
passed away on October 16, 2013. In 2019, Marsha
Kilgore's daughter Brooke Noble, represented by attorney
Lenore Albert and purporting to represent the estate of
Marsha Kilgore, brought the present motion to vacate the
judgment in this case based on a theory of fraud on the
court. Doc. 67. Defendant opposes the motion, arguing that
Noble has not been properly substituted into this case,
Albert is not eligible to practice law as she is under
discipline from the California Bar Association, and that
there was no fraud on the court. Doc. 71. Noble then filed a
motion to allow substitution. Doc. 74. For ease of
resolution, the court will address the merits of the fraud on
the court argument.
Rule of Civil Procedure 60(b) preserves the district
court's right to hear an independent action to set aside
a judgment for fraud. An independent action to set aside a
judgment for fraud on the court is “reserved for those
cases of injustices which, in certain instances, are deemed
sufficiently gross to demand a departure from rigid adherence
to the doctrine of res judicata.” United States v.
Beggerly, 524 U.S. 38, 46 (1998), citations and
quotations omitted. Fraud on the court is “an
unconscionable plan or scheme which is designed to improperly
influence the court in its decision. The motion to set aside
on this ground is addressed to the sound discretion of the
trial court. And the burden is on the moving party to
establish fraud by clear and convincing evidence.”
England v. Doyle, 281 F.2d 304, 309-10 (9th Cir.
1960), citations omitted. “‘Fraud upon the
court' should, we believe, embrace only that species of
fraud which does or attempts to, defile the court itself, or
is a fraud perpetrated by officers of the court so that the
judicial machinery can not perform in the usual manner its
impartial task of adjudging cases that are presented for
adjudication.” Alexander v. Robertson, 882
F.2d 421, 424 (9th Cir. 1989), citing 7 J. Moore & J.
Lucas, Moore's Federal Practice ¶ 60.33, at 515 (2nd
ed. 1978). The movant must show “conduct: 1) on the
part of an officer of the court; 2) that is directed at the
judicial machinery itself; 3) that is intentionally false,
wilfully blind to the truth, or is in reckless disregard for
the truth; 4) that is a positive averment or a concealment
when one is under a duty to disclose; and 5) that deceives
the court.” Workman v. Bell, 484 F.3d 837, 840
n. 1 (6th Cir. 2007), citing Demjanjuk v. Petrovsky,
10 F.3d 338, 348 (6th Cir. 1993).
argues that Defendant has hidden key information from the
court. There seems to be three main assertions: Defendant
should not have held the trustee's sale on July 31,
Defendant hid the fact that the property was sold on July 31,
and Defendant hid the fact that the July 31 sale was never
rescinded. None of these assertions are factually true.
Plaintiff argues that Defendant was not permitted to hold a
trustee's sale on July 31. As stated above, Plaintiff
believed the June 29 preliminary injunction prohibited any
sale until the court ruled on the pending motion to dismiss.
The order resolving that motion was not issued until July 31.
Additionally, Plaintiff argues the sale violated California
Civil Code 2924g(d) which states in relevant part
the sale shall be conducted no sooner than on the seventh day
after the…expiration or termination of the injunction,
restraining order, or stay that required postponement of the
sale, whether by entry of an order by a court of competent
jurisdiction, operation of law, or otherwise, unless the
injunction, restraining order, or subsequent order expressly
directs the conduct of the sale within that seven-day period.
For purposes of this subdivision, the seven-day period shall
not include the day on which the action is dismissed, or the
day on which the injunction, restraining order, or stay
expires or is terminated.
June 29 order stated “Defendants are RESTRAINED from
proceeding with the Trustee Sale until after July 23,
2012.” Doc. 22, 4:19-20. The injunction was not open
ended; it expired on July 23. The seven day period ran from
July 24 through July 30. Defendant was permitted to go
forward with the sale on July 31.
in briefing, Plaintiff repeatedly states that Defendant did
not inform the court that the July 31 sale took place:
“Defendants and their Counsel transferred title of Ms.
Kilgore's home on July 31, 2012 but never spoke out when
the Court issued an order on July 31, 2012 and again on
August 10, 2012 restraining Defendants from transferring
title by way of foreclosure sale.” (Doc. 67, 16:8-13);
“There is nothing in the record to show the Court was
ever made aware of the violation when it made its orders from
July 31, 2012 through May 2013.” (Doc. 67, 7:1-3);
“No notice appears in the record to demonstrate
Defendants or their counsel informed the Court that Ms.
Kilgore's house sold on July 31, 2012.” (Doc. 67,
4:21-24). These assertions are puzzling as Plaintiff also
acknowledges in the briefing that “Ken Franklin
informed the Court that the sale ...