Burckhart Search Grp. Inc. v. Doral Fin. Corp.
| Decision Date | 30 November 2011 |
| Docket Number | Civil No. 11-1565 (JAF) |
| Parties | BURCKHART SEARCH GROUP, INC., and ANGEL BURCKHART LOPEZ, Plaintiffs, v. DORAL FINANCIAL CORPORATION, et. al., Defendants. |
| Court | U.S. District Court — District of Puerto Rico |
Plaintiffs sue seeking relief under, inter alia, 42 U.S.C. §§ 1983, the Clayton Act, 15 U.S.C. §§ 12-27, and the Sherman Act, 15 U.S.C. §§ 1-7. (Docket No. 5.) Pending before this court are several motions for dismissal, two of which we resolve in this Opinion.1 Codefendants Judge Wanda Cruz-Ayala, Judge Olga Garcia-Vincenty, and Judge Isabel Llompart-Zeno ("the Judges") move for dismissal under Federal Rule of Civil Procedure 12(b)(6). (Docket No. 20.) Plaintiffs oppose. (Docket No. 33.) Additionally, codefendants Doral Financial Corporation ("DFC"), Doral Mortgage Bank, Enrique Ubarri, Laura Crumley, along with Glen Wakeman,Carla Wakeman, and their conjugal partnership (together "Movants") move for dismissal under Federal Rule of Civil Procedure 12(b)(6) and 12(b)(1). (Docket No. 30.) Plaintiffs oppose. (Docket No. 48.)
We derive the following summary of the allegations from the parties' pleadings and motions. (Docket Nos. 5; 20; 30; 33; 48.) Coplaintiff Burckhart Search Group Incorporated ("BSG") offers services in Puerto Rico such as the "search, evaluation and recruitment of professional executive personnel for high management positions in commerce and industry." (Docket No. 5 at 4-5.) Codefendant Careers Incorporated ("Careers") offers the same type of recruiting services as Plaintiffs, and codefendant DFC has employed such recruiting services to find officers for the corporation. (Id.)
In their Amended Complaint of fifty-seven pages, Plaintiffs allege a galactic array of injustices, intrigues, and conspiracies against BSG, beginning with a conspiracy to "terminate Plaintiffs' contractual relationship with DFC" and displace them as DFC's provider of recruiting services. (Id. at 11.) On May 7, 2007, Plaintiffs brought a civil action ("the Commonwealth case") in the Commonwealth Court of First Instance in San Juan Puerto Rico, under Judge Wanda Cruz-Ayala, "for breach of contract on commissions due demanding the payment of $80,000 for having found the candidate ultimately selected by defendant Doral Financial Corporation to occupy the position of Senior Vice President and Director of Internal Auditing." (Id. at 10 ). On July 7, 2009, the parties in the Commonwealth case met for a settlement conference, and discussed a proposed settlement agreement in which "BSG would move for the voluntary dismissal of its claim for commissions due, with prejudice" in return for $50,000. (Id. at 14.) A few days after the meeting, however, negotiations failed because of what Plaintiffs viewed as additional and unfair terms added by DFC. (Id. at 15.) No settlement was reached.
On September 24, 2009, Judge Cruz-Ayala denied Plaintiffs' motion to "to compel compliance with the judicial settlement" terms they desired. (Id. at 23.) Plaintiffs then concluded that Judge Cruz-Ayala acted in a biased manner because of her refusal to compel settlement or compel additional discovery. (Id. at 16, 22.) Plaintiffs filed a motion for her recusal on October 9, 2009, which was denied by Judge Garcia-Vincenty on December 18, 2009. (Id. at 26, 27.) Judge Garcia-Vincenty denied Plaintiffs' subsequent motion for reconsideration and it became final on January 22, 2010, and "not amenable to be revised by interlocutory appeal." (Id. at 27.)
Indefatigable, Plaintiffs next targeted Judge Garcia-Vincenty—who they claim to be biased due to an attenuated connection to past counsel or past board members of DFC—and filed a new motion to set aside her denial of the original recusal motion, which Judge Garcia-Vincenty denied on March 3, 2010. (Id. at 27, 33.) Subsequently, Plaintiffs filed a "Memorandum for the Record" to protest the proceedings with the Judge Administrator for the Court of First Instance of San Juan, Judge Llompart-Zeno, on March 10, 2010, which they claim was ignored. (Id. at 33.)
Finally, over four years after initiating the Commonwealth case, Plaintiffs brought the present suit in this court on June 16, 2011.2 (Docket No. 1.) In addition to the Judges, Plaintiffs have also named as codefendants various corporate officers of DFC, Careers, and other related corporations, as well as various attorneys representing the defendants in the Commonwealth case (together "the private defendants"). (See Docket No. 5 at 8-10.)
A defendant may move to dismiss an action against her under Federal Rule of Civil Procedure 12(b)(1) for lack of federal subject matter jurisdiction. See Fed. R. Civ. P. 12(b)(1). "When a defendant moves to dismiss for lack of federal subject matter jurisdiction, 'the party invoking the jurisdiction of a federal court carries the burden of proving its existence.'" Johansen v. United States, 506 F.3d 65, 68 (1st Cir. 2007) (citing Murphy v. United States, 45 F.3d 520, 522 (1st Cir. 1995).
Rule 12(b)(1) provides a "large umbrella, overspreading a variety of different types of challenges to subject-matter jurisdiction." Valentin v. Hosp. Bella Vista, 254 F.3d 358, 362-63 (1st Cir. 2001). A movant may base a challenge to the sufficiency of the plaintiff's assertion of subject matter jurisdiction solely on the pleadings. Id. at 363. In that case, we take theplaintiff's "jurisdictionally-significant facts as true" and "assess whether the plaintiff has propounded an adequate basis for subject-matter jurisdiction." Id. at 363; see Pejepscot Indus. Park, Inc. v. Maine Cent. R.R. Co., 215 F.3d 195, 197 (1st Cir. 2000).
A defendant may move to dismiss an action, based solely on the complaint, for the plaintiff's "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). In assessing such a motion, we "accept[] all well-pleaded facts as true, and we draw all reasonable inferences in favor of the [plaintiff]." Wash. Legal Found. v. Mass. Bar Found., 993 F.2d 962, 971 (1st Cir. 1993).
"[A]n adequate complaint must provide fair notice to the defendants and state a facially plausible legal claim." Ocasio-Hernandez v. Fortuno-Burset, 640 F.3d 1, 12 (1st Cir. 2011). In considering a complaint's adequacy, we disregard "statements in the complaint that merely offer legal conclusions couched as fact or threadbare recitals of the elements of a cause of action." Id. (internal quotation marks omitted). We then take as true what remains, "[n]onconclusory factual allegations . . . even if seemingly incredible." Id. On the basis of those properly pled facts, we assess the "reasonableness of the inference of liability that the plaintiff is asking the court to draw." Id. at 13.
Before addressing the sufficiency of the Complaint, we address Movants' arguments under Rule 12(b)(1). Specifically, they argue that the Rooker-Feldman doctrine precludesjurisdiction and, in the alternative, argue for Younger abstention.3 (Docket No. 30 at 12-16.) We reject these arguments.
Under the Rooker-Feldman doctrine, federal district courts lack jurisdiction over complaints that invite review of state or Commonwealth court judgments. Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 125 S. Ct. 1517, 1521 (2005) (citing D.C. Court of Appeals v. Feldman, 460 U.S. 462 (1983); Rooker v. Fid. Trust Co., 263 U.S. 413 (1923)); see also Puerto Ricans for P.R. Party v. Dalmau, 544 F.3d 58, 68 (1st Cir. 2008) (citing Badillo-Santiago v. Naveira-Merly, 378 F.3d 1, 6 (1st Cir. 2004)) ( that Puerto Rico is treated as a state for Rooker-Feldman purposes). The Rooker-Feldman doctrine implies subject-matter jurisdiction. New Eng. Power and Marine, Inc. v. Town of Tyngsborough (In re Middlesex Power Equip. & Marine, Inc.), 292 F.3d 61, 66 n.1 (1st Cir. 2002). The doctrine "applies only in the 'limited circumstances' where 'the losing party in state court filed suit in federal court after the state proceedings ended, complaining of an injury caused by the state-court judgment and seeking review and rejection of that judgment.'" Federacion de Maestros de P.R. v. Junta de Relaciones del Trabajo de P.R., 410 F.3d 17, 23-24 (1st Cir. 2005) (emphasis added) (citing Exxon Mobil Corp., 125 S. Ct. at 1526); see also id. at 24 ().
In the present case, however, the Commonwealth case is nowhere near finished, as the Plaintiffs' detailed summary of the saga indicates. Unfortunately for this court, the interlocutory order touted by Movants as "final" and "unappealable" cannot provide the "ending" necessary to invoke the Rooker-Feldman doctrine; the case they invoke, Federacion de Maestros de Puerto Rico, 410 F.3d 17, proves inapposite. There, the First Circuit noted that state or Commonwealth proceedings could be considered to have "ended" for Rooker-Feldman purposes "if the state court proceedings have finally resolved all the federal questions in the litigation, but state law or purely factual questions (whether great or small) remain to be litigated." Id. at 25. Nothing in the pleadings in the present case indicates that Plaintiffs have ever litigated federal questions in the ongoing Commonwealth case, much less reached a resolution. The "final" interlocutory order at issue—denying Plaintiffs' motion for the recusal of Judge Cruz-Ayala—dealt solely with questions of Commonwealth law.
We reject Movants' arguments for Younger abstention. Although "frequently associated...
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