Niles v. Wilshire Inv. Grp., LLC

Decision Date21 March 2012
Docket NumberNo. 09–CV–3638 (JFB)(ARL).,09–CV–3638 (JFB)(ARL).
Citation859 F.Supp.2d 308
PartiesRosaria NILES and Salvatore A. Bono, Plaintiffs, v. WILSHIRE INVESTMENT GROUP, LLC, et al., Defendants.
CourtU.S. District Court — Eastern District of New York

OPINION TEXT STARTS HERE

Rosaria Niles and Salvatore A. Bono, West Bay Shore, NY, pro se.

Diane C. Leonardo–Beckmann, United States Attorneys Office, Central Islip, NY, for The Federal Defendants.

Frank T. Santoro, Farrell Fritz, PC, Uniondale NY, for The Foundation Defendants.

Mark R. Knuckles, Knuckles, Komosinski & Elliott, LLP, Elmsford, NY, for Defendants American Key and Wilshire Group.

Edward Richard Finklestein, Tarter Krinsky & Drogin, LLP, New York, NY, for TierOne Bank.

memorandum and order adopting report and recommendation

JOSEPH F. BIANCO, District Judge.

On August 21, 2009, pro se plaintiffs Rosaria Niles (Rosaria) and Salvatore A. Bono (Bono) (together, plaintiffs) brought this action, pursuant to a lengthy list of statutes and constitutional provisions,1 against defendants Wilshire InvestmentGroup, LLC, American Key, Inc., TierOne Bank, Geoffrey M. Parkinson (Parkinson), Leland C. Selby (“Selby”), James Lamb, Laura J. Niles Foundation, Inc., Henry E. Niles Foundation, Inc., Central Intelligence Agency, CIA Officer Mitchell E. Kline, CIA Officer Lydia Spellman, CIA Officer John T. Martinez, and their superior commanding Officers John Doe and/or Jane Doe, and the U.S. Attorney for the Eastern District of New York. (collectively defendants). Plaintiffs allege that defendants have operated as CIA operatives as part of a vast scheme and conspiracy to “wrest control of the large estates of citizens living along the eastern seaboard.” (Amended Complaint, Nov. 1, 2010, ECF No. 88, at ¶ 16.) Plaintiffs maintain that defendants executed this scheme by manipulating and subverting several earlier judicial proceedings to which plaintiffs were parties.

Before the Court is a Report and Recommendation (“R & R”) from Magistrate Judge Arlene Lindsay, as well as plaintiffs' objections to the R & R. The R & R recommended that all defendants' motions to dismiss be granted. Furthermore, the R & R recommended that the District Court impose a filing injunction on plaintiffs prohibiting plaintiffs from filing any further lawsuits in the Eastern District of New York without permission of the court.

For the reasons that follow, the Court adopts in full Magistrate Judge Lindsay's thorough and well-reasoned R & R, except that the Court narrows the recommended language of the injunction to make it pertain only to the subject matter of the instant litigation (and the other prior lawsuits described infra ).

I. Background

As relevant background, the instant action and many of the plaintiffs' earlier judicial proceedings relate to events concerning the estates of Laura J. Niles and her brother Henry E. Niles, who inherited a large fortune from their father. Rosaria married Henry Niles in 1992, and, in 1997, Laura Niles amended her will and modified certain trust agreements, nominating Bono, who is Rosaria's son, as executor of her will and trustee of her trusts. (R & R at 2–4.)

The instant action is the latest in a series of judicial proceedings that includes:

1. An action commenced January 20, 1998 in New Jersey Superior Court that, among other things, removed plaintiff Bono as trustee for Laura Niles's trusts on the grounds that he had embezzled and misused her assets and that he had unduly influenced her. (R & R at 4.)

2. A proceeding in New York State Surrogate Court to probate the Last Will and Testament of Henry E. Niles. Rosaria filed various objections to the probate of the will and commenced a proceeding by Petition verified September 17, 1998 to revoke preliminary letters testamentary issued to Laura Niles's friend and financial advisor, Parkinson, and Parkinson's attorney, Selby, and also commenced a proceeding by Petition verified December 20, 1999 against the estate of Henry E. Niles to compel payment of a claim. (R & R at 5.)

3. A lawsuit filed on September 29, 1999 by Bono in U.S. District Court for the Eastern District of New York (“E.D.N.Y.”) against several defendants, including, for example, counsel for Parkinson and Selby, a New Jersey Superior Court Judge, a Superior Court Surrogate, and a court-appointed guardian ad litem in the New Jersey probate action. The suit alleged that defendants conspired to manipulate and subvert the judicial systems of the states of New York and New Jersey in an effort to reap financial gains at the expense of Bono and elderly citizens of New York and New Jersey. Bono amended his complaint to allege that Selby and Parkinson acted in concert with Joseph J. Kunzeman, who was conservator of Henry Niles's property, to manipulate the judicial system to avoid losing control over the Niles's assets. (R & R at 7.)

4. A foreclosure proceeding instituted by TierOne on July 11, 2005 against Rosaria to foreclose the mortgage held on Rosaria's residence located at 223 Lakeview Avenue West in Brightwaters, New York. Rosaria filed a notice of removal of the foreclosure proceeding to the E.D.N.Y. and asserted cross-claims against Parkinson, Selby, and others, alleging, inter alia, that various CIA officers persecuted the Niles family. Judge Joanna Seybert remanded the action to New York Supreme Court, Suffolk County, which granted summary judgement to TierOne, entered a judgment of foreclosure, and appointed a referee to sell the mortgaged premises at public auction. Rosaria made numerous attempts to stay enforcement of the judgement of foreclosure and sale, which the Appellate Division, Second Department twice denied in January 2008. Rosaria then attempted to stay the foreclosure by filing petitions in Bankruptcy Court. After the automatic stay was lifted, Rosaria made two unsuccessful applications to reinstate the stay, then filed another motion in the Appellate Division, Second Department, seeking, inter alia, another stay of the foreclosure sale pending appeal. The Appellate Division denied the motion. Rosaria filed another application in Supreme Court, Suffolk County seeking, inter alia, an order staying the foreclosure sale and vacating the judgment of foreclosure. The application was denied, and the premises were sold at a foreclosure sale to Wilshire and American Key on April 8, 2009. (R & R at 8–10.)

On August 21, 2009, plaintiffs commenced the instant action. On September 2, 2009, plaintiffs initiated another action in Supreme Court, Suffolk County, seeking principally the same relief as in the instant action. (R & R 10–11.)

II. Procedural History

On August 21, 2009, pro se plaintiffs filed their complaint. On April 26, 2010, defendants Geoffrey M. Parkinson, Leland C. Selby, James Lamb, the Laura J. Niles Foundation, Inc., and the Henry E. Niles Foundation (“the Foundation Defendants) filed a motion to dismiss. On April 29, 2010, TierOne filed a motion to dismiss. On April 30, 2010, Wilshire Investment Group, LLC, and American Key, Inc. (defendants Wilshire and American Key”) filed a motion to dismiss. On April 30, 2010, United States of America/Central Intelligence Agency, the U.S. Attorney's Office for the Eastern District of New York, Mitchell E. Kline, John T. Martinez, Lydia Spellman, and their commanding superior CIA officers, John Doe and/or Jane Doe (“the Federal Defendants) filed a motion to dismiss.

By Order dated September 1, 2010, the Court referred the motions to Magistrate Judge Lindsay for a report and recommendation. On September 17, 2010, Magistrate Judge Lindsay terminated the above four motions to dismiss and implemented the bundle rule. On November 1, 2010, plaintiffs filed an amended complaint.

On March 18, 2011, the Federal Defendants, the Foundation Defendants, and Defendants Wilshire and American Key each filed motions to dismiss. By Affirmation dated March 17, 2011, TierOne joined in the motions brought by the Federal Defendants and the Foundation defendants. On March 18, 2011, in accordance with the bundle rule, plaintiffs filed a Memorandum in Opposition, and defendants Wilshire and American Key filed a reply.

On August 31, 2011, Magistrate Judge Lindsay issued the R & R recommending that all defendants' motions to dismiss be granted and recommending that the District Court impose a filing injunction on plaintiffs. The R & R further instructed that any objections to the R & R be submitted within fourteen (14) days of receipt. (R & R at 37.) On September 19, 2011, plaintiffs filed an objection to the R & R. (Pls.' Objections to the R & R, Sept. 19, 2011, ECF No. 163 (“Obj.”).) The Foundation Defendants filed a Memorandum in Opposition to the plaintiffs' objection on October 3, 2011.

III. Standard of Review

A district judge may accept, reject, or modify, in whole or in part, the findings and recommendations of the Magistrate Judge. See DeLuca v. Lord, 858 F.Supp. 1330, 1345 (S.D.N.Y.1994); Walker v. Hood, 679 F.Supp. 372, 374 (S.D.N.Y.1988). As to those portions of a report to which no “specific written objection” is made, the Court may accept the findings contained therein, as long as the factual and legal bases supporting the findings are not clearly erroneous. See Greene v. WCI Holdings Corp., 956 F.Supp. 509, 513 (S.D.N.Y.1997) (citing Thomas v. Arn, 474 U.S. 140, 149, 106 S.Ct. 466, 88 L.Ed.2d 435 (1985)); Santana v. United States, 476 F.Supp.2d 300, 302 (S.D.N.Y.2007). Where the report is dispositive of the case, the Court reviews de novo the portions to which objections have been filed. SeeFed.R.Civ.P. 72(b); Williams v. Beemiller, Inc., 527 F.3d 259, 264 (2d Cir.2008) (noting that a report recommending remand was dispositive).

IV. Analysis

The Court has conducted a review of the full record, including, among other things, the complaint, the parties' respective submissions in connection with the parties' motions, as well as the R & R, applicable law, and plaintiffs' objections. Having reviewed de novo all portions of the R & R to which plaint...

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