Arroyo v. Fdic

• Decision Date: 16 August 2013
• Docket Number: Civil No. 12–1433 (FAB).
• Citation: 961 F.Supp.2d 386
• Parties: Abigail ARROYO, Plaintiff, v. FDIC, et al., Defendants.
• Court: U.S. District Court — District of Puerto Rico

961 F.Supp.2d 386

Abigail ARROYO, Plaintiff,

v.FDIC, et al., Defendants.

Civil No. 12–1433 (FAB).

United States District Court, D. Puerto Rico.

Aug. 16, 2013.

Abigail Arroyo, Aguadilla, PR, pro se.

Larry L. Goodman, Federal Deposit Insurance Corporation, Arlington, VA, Jose A. Andreu–Fuentes, Andreu & Sagardia Law Office, Nelson N. Cordova–Morales, Cordova Morales Law Offices, Amelia Caicedo–Santiago, Reichard & Escalera, Edelmiro Antonio Salas–Gonzalez, San Juan, PR, for Defendants.

OPINION AND ORDER

BESOSA, District Judge.

Before the Court is defendant Camilo Velazquez–Velez (“Velazquez”), defendant Banco Popular's (“BPPR”), and defendant Luis F. Carlo–Mendoza's (“Carlo”) motions to dismiss the case and motions for summary judgment. (Docket Nos. 34 & 40.) Also before the Court is plaintiff Abigail Arroyo's (“Arroyo”) motion for summary judgment. (Docket No. 82.) After reviewing the motions and the relevant responses and replies, the Court GRANTS defendants Velazquez's and BPPR's motion to dismiss, (Docket Nos. 34 & 40). The Court finds MOOT the motions for summary judgment. (Docket Nos. 34 & 82.)

DISCUSSION

I. Background

The Court declines to rehash all of the facts. Background information or facts will be recounted as needed in the Court's subsequent legal analysis of particular issues. See United States v. Stierhoff, 549 F.3d 19, 21 (1st Cir.2008).

On June 4, 2012, plaintiff Arroyo filed a pro se complaint requesting a fair trial for “violation of civil rights” and alleging that “[p]laintiff's lawsuit pertains to the FDIC in its corporate capacity ...” (Docket No. 1 at pp. 1 & 12.) In the complaint, plaintiff Arroyo describes how on November 10, 2008, he filed a lawsuit in the Puerto Rico Court of First Instance in Aguadilla (“the Puerto Rico trial court”) against certain parties, including Westernbank, ¹ regarding a sales-purchase agreement on a piece of property. (Docket No. 1 at pp. 1–5; Docket No. 48–1 at p. 2.) Specifically, plaintiff Arroyo argued that all defendants were “jointly and severally liable for having made him to believe that the transaction that was carried out was lawful and correct.” (Docket No. 48–1 at p. 2.) The parties agree that on April 30, 2010, while this case was ongoing in the Puerto Rico trial court, the Office of the Commissioner of Financial Institutions of the Commonwealth of Puerto Rico (“OCFIC–PR”) determined that Westernbank was not in good financial condition and could not continue its business. ( See Docket No. 1 at p. 5; Docket No. 34 at p. 3.) Therefore, the OCFIC–PR closed the bank and appointed the Federal Deposit Insurance Corporation as receiver of the failed bank. Id.

On June 7, 2011, the Puerto Rico trial court substituted the defendant Westernbank ² with the FDIC. (Docket No. 48–1 at p. 4.) On July 15, 2011, instead of choosing to remove the case to federal court,³ the FDIC filed a motion to dismiss the case before the Puerto Rico trial court, alleging that plaintiff Arroyo failed to exhaust administrative remedies pursuant to the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (“FIRREA”), 12 U.S.C. § 1821(d)(6). (Docket No. 48–1 at p. 4.) The Puerto Rico trial court agreed with the FDIC and on October 24, 2011, it issued a “Report of Proceedings, Factual Determinations, Legal Conclusions and Partial Summary Judgement,” which dismissed plaintiff Arroyo's complaint with respect to the FDIC in its capacity as Westernbank's receiver. Id. at pp. 5–7. Notably, the Puerto Rico trial court determined that plaintiff Arroyo received proper notice of (1) the FDIC's appointment as the receiver for Westernbank, and (2) the fact that a plaintiff must exhaust administrative remedies before pursuing his or her claim in any court. Id. Furthermore, it found that plaintiff Arroyo failed to exhaust his administrative remedies pursuant to FIRREA, and, therefore, it had no jurisdiction over plaintiff Arroyo's case. On November 28, 2011, plaintiff Arroyo appealed the Puerto Rico trial court's decision. Id. at p. 7. On March 28, 2012, the Puerto Rico Court of Appeals affirmed the Puerto Rico trial court's decision. Id. at pp. 23–25.

Plaintiff Arroyo also alleges that he did not receive proper notice of the FDIC's appointment and of the requirement to exhaust administrative remedies. (Docket No. 1 at pp. 9–10.) In addition, plaintiff Arroyo describes how he enlisted the help of two attorneys to help him with his case in the Puerto Rico courts. (Docket No. 1 at p. 11.) He states that he hired defendant Velazquez as his second lawyer on September 21, 2011. Id. He argues, however, that defendant Velazquez failed to help plaintiff Arroyo with his contentions. Id. Given these facts, plaintiff Arroyo argues that the Puerto Rico trial court, the FDIC, and various officers, including those who worked for the FDIC and Westernbank, and two lawyers, defendant Luis F. Morales–Gonzalez (“Morales”) and defendant Velazquez; violated his civil rights. (Docket No. 1 at pp. 6 & 12.)

On November 9, 2012, defendant Velazquez filed a motion to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) (“Rule 12(b)(1)”) for lack of subject-matter jurisdiction and 12(b)(6) (“Rule 12(b)(6)”) for failure to state a claim. (Docket No. 34.) On that same day, defendant Velazquez also filed a motion for summary judgment. Id. He contends that plaintiff's claims are barred under the Rooker–Feldman doctrine. Id. at pp. 6–7. He also argues that plaintiff Arroyo's legal action against the FDIC and its federal officers is barred by res judicata and collateral estoppel. Id. at pp. 7–8. In the alternative, defendant Velazquez argues that plaintiff's claims should be dismissed for failure to exhaust administrative remedies pursuant to FIRREA.⁴Id. at p. 8. Furthermore, defendant Velazquez argues that the remaining malpractice claim against him is based in tort under Commonwealth law, and, therefore, should be dismissed because no federal cause of action exists. (Docket No. 34 at pp. 15–16.) In the alternative, he also argues that even if this Court has jurisdiction over plaintiff Arroyo's case, plaintiff Arroyo has failed to state a claim against defendant Velazquez given the facts that were stated in the complaint. Id. at pp. 16–19.

On November 20, 2012, defendant BPPR filed a motion to join defendant Velazquez's motion to dismiss and his motion for summary judgment. (Docket No. 40.) In that motion, BPPR reiterates the arguments that defendant Velazquez stated in his motion, (Docket No. 34), regarding the Rooker–Feldman doctrine and res judicata. (Docket No. 40.) On December 4, 2012, plaintiff Arroyo filed a response in opposition to defendants Velazquez's and BPPR's motions. (Docket No. 50.) On December 24, 2012, defendant Carlo also requested to join both defendants Velazquez's and BPPR's motions, (Docket Nos. 34 & 40). (Docket No. 59.) On December 26, 2012, the Court granted defendant Carlo's motion. (Docket No. 61.) On January 3, 2013, the Court reminded plaintiff that the Court may appoint pro bono counsel for him. (Docket No. 70.)

After reviewing all of the relevant motions, responses, replies, and exhibits, the Court agrees with defendants Velazquez, BPPR and Carlo. Therefore, the Court GRANTS defendants' motion to dismiss. Defendants' and plaintiff's motions for summary judgment, (Docket Nos. 34 & 82), and plaintiff Arroyo's motion for summary judgment, are deemed MOOT.

II. Legal StandardsA. Pro Se

“As the [Supreme] Court unanimously held in Haines v. Kerner, 404 U.S. 519, 92 S.Ct. 594, 30 L.Ed.2d 652 (1972), a pro se complaint, ‘however inartfully pleaded,’ must be held to ‘less stringent standards than formal pleadings drafted by lawyers' ...” Hughes v. Rowe, 449 U.S. 5, 10, 101 S.Ct. 173, 66 L.Ed.2d 163 (1980). Therefore, a district court must construe a pro se plaintiff's pleadings somewhat liberally. Instituto de Educacion Universal Corp. v. U.S. Dept. of Educ., 209 F.3d 18, 23 (1st Cir.2000) (“The Supreme Court has long held that complaints drafted by non-lawyers are to be construed with some liberality.”) Pro se status, however, “does not exempt a party from compliance with relevant rules of procedural and substantive law.” Velez–Villaran v. Carico Int'l., Inc., 715 F.Supp.2d 250, 252 (D.P.R.2010) (citing Triestman v. Federal Bureau of Prisons, 470 F.3d 471, 477 (2d Cir.2006)).

B. Legal Standard Under Rule 12(b)(1) and Rule 12(b)(6)

Federal courts are courts of limited jurisdiction. Destek Grp. v. State of N.H. Pub. Utils. Comm'n., 318 F.3d 32, 38 (1st Cir.2003). Accordingly, “federal courts have the duty to construe their jurisdictional grants narrowly.” Fina Air, Inc. v. United States, 555 F.Supp.2d 321, 323 (D.P.R.2008) (citing Alicea–Rivera v. SIMED, 12 F.Supp.2d 243, 245 (D.P.R.1998)). Because federal courts have limited jurisdiction, the party asserting jurisdiction carries the burden of showing the existence of federal jurisdiction. Viqueira v. First Bank, 140 F.3d 12, 16 (1st Cir.1998) (internal citations omitted).

Pursuant to Rule 12(b)(1), a party may move to dismiss an action for lack of subject-matter jurisdiction. Fed.R.Civ.P. 12(b)(1); see also Valentin v. Hosp. Bella Vista, 254 F.3d 358, 362 (1st Cir.2001) (discussing how Rule 12(b)(1) is the “proper vehicle for challenging a court's subject-matter jurisdiction.”) Motions brought pursuant to Rule 12(b)(1) are subject to a similar standard as Rule 12(b)(6) motions. Defendants move to dismiss this action pursuant to both Rules 12(b)(1) and 12(b)(6). ⁵

Subject-matter jurisdiction is properly invoked when a colorable claim “arising under” the Constitution or laws of the United States is pled. 28 U.S.C. § 1331; Arbaugh v. Y & H Corp., 546 U.S. 500, 513, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006) (internal citation omitted). Usually, a claim arises pursuant to federal law if a federal cause of action emerges from the face of a well-pleaded complaint. See Viqueira, 140 F.3d at 17 (internal citations omitted).

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