27 Oct Homeowner Who Lost Opposition to Foreclosure In State Court Can’t Ask Federal Court to Review and Reject State-Court Judgment

The Tenth Circuit in McDonald v. J.P. Morgan Chase Bank, N.A., recently affirmed the Colorado federal district court’s dismissal of a homeowner’s federal lawsuit, which sought review and reversal of a state court order approving the foreclosure of his home.

Mr. McDonald defaulted on his home loan and the bank initiated foreclosure proceedings in Colorado.  After a Rule 120 hearing, the court authorized the sale of the property.  One day before the sale, McDonald initiated an action in federal court, filing both a complaint and an emergency motion for a temporary restraining order to stop the sale of his home.

McDonald, who was representing himself without an attorney, failed to stop the sale, but the case proceeded.  His complaint asserted 13 claims, all of which related to the foreclosure.  McDonald argued that the bank prevented him from negotiating a foreclosure deferment and therefore, the foreclosure resulted in conversion of his property.  He also alleged fraud upon the court, conspiracy to defraud, civil conspiracy, and attempting to influence a public servant, along with other tort and contract claims.  Most of the claims were based on the fact that the bank’s failure to provide information about the note holder before and during the foreclosure hearing caused him to lose his home.

The district court granted in part the bank’s motion to dismiss, finding the court didn’t have subject-matter jurisdiction over many of the claims.  The district court held that since McDonald’s claims sought to invalidate the state-court foreclosure, they were barred under the Rooker-Feldman doctrine.  That doctrine prohibits a lower federal court from reviewing state-court judgments.  With 10 of his 13 claims, the district court ruled that this is exactly what McDonald was trying to do.  McDonald failed to allege any injury in those claims that was separate from the state-court-authorized foreclosure.  McDonald only contended that the Rooker-Feldman was inapplicable because the order authorizing sale was not a final judgment.

The court also subsequently granted the bank’s motion for summary judgment, finding that McDonald had failed to establish even a prima facie claim with respect to his remaining claims.

In McDonald v. J.P. Morgan Chase Bank, N.A., No. 15-1168, 2016 WL 4547605, at *1 (10th Cir. Aug. 31, 2016), Circuit Judge Harris L. Hartz, writing the opinion for the Tenth Circuit Court of Appeals, affirmed that judgment. Although McDonald made arguments in his brief that were not pertinent to the appeal, Judge Hartz did discuss his argument that the district court misapplied the Rooker-Feldman doctrine to the state-court foreclosure proceedings. Judge Hartz wrote that Rooker-Feldman does apply to the foreclosure judgment, and explained that the Rooker-Feldman doctrine bars claims “complaining of injuries caused by state-court judgments.”  In other words, Judge Hartz said, a party who loses in state court can’t bring a case seeking review and rejection of the state-court judgment in federal court.

The Court also held that McDonald may have tried to appeal the district court’s grant of summary judgment on his other claims, but he didn’t adequately present any argument that warranted the appellate court’s consideration.  Plus, no other arguments were listed in his statement of the issues.

As a result, the judgment of the district court was affirmed, and McDonald, acting as his own legal counsel, lost his case and his home.