Buzzell et al v. JP Morgan Chase Bank et al, No. 3:2013cv00668 - Document 66 (E.D. Va. 2015)
Court Description: MEMORANDUM OPINION. Signed by District Judge James R. Spencer on 9/9/2015. Copy mailed to Pro Se Plaintiff. (jsmi, )
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Buzzell et al v. JP Morgan Chase Bank et al Doc. 66 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF VIRGINIA RICHMOND DIVISION STEPHEN F. BUZZELL, et al., Plaintiffs, v. Civil Action No. 3:13– CV– 668 J P MORGAN CHASE BANK, et al., Defendants. MEMORAN D U M OPIN ION THIS MATTER is before the Court on Defendant J PMorgan Chase Bank, N.A.’s Motion to Stay Proceeding (“Motion”). ECF No. 57. Plaintiffs filed a response in opposition on August 21, 20 15 (“Opp’n Mem .”). ECF No. 63. Defendant subsequently filed a reply on August 25, 20 15 (“Reply Mem .”). ECF No. 65. For the reasons that follow, the Court will GRANT the Motion. I. BACKGROU N D On or about J uly 1, 20 0 3, Plaintiff Stephen F. Buzzell took out a loan for $ 288,0 0 0 as evidenced by a prom issory note (“Note”). Repaym ent of the Note was secured by the property at 180 Tabbs Choice Road, White Stone, Virginia (“Property”) pursuant to a deed of trust (“Deed of Trust”), to which both Plaintiffs are parties. At som e point, the Note was transferred to Residential Funding Corporation, who then transferred the Note to Defendant, J P Morgan Chase Bank. A foreclosure sale was conducted on Septem ber 2, 20 0 8, prom pting Plaintiffs to file suit in the Circuit Court of Lancaster County (“Lancaster Circuit Court”) against GMAC Mortgage, LLC, Hom ecom ings Financial, and MERS (collectively, the “Lenders”); Sam uel I. White, PC (“SIW”); and the J . Carrington Burgess Revocable Trust (the “Trust”). In the state court com plaint, Plaintiffs alleged claim s of “fraud, m isrepresentation, and breach of fiduciary duty.” The Lancaster Circuit Court granted the Lenders’ joint dem urrer, as well as the dem urrer of 1 Dockets.Justia.com SIW, “but granted Plaintiffs leave to am end their com plaint as to SIW only.” Thus, SIW is the sole rem aining defendant in this 20 0 8 state court action, which is still currently pending against SIW. Plaintiffs then filed the instant action in the Lancaster Circuit Court on or around Septem ber 1, 20 13, alleging sim ilar claim s related to the foreclosure of their hom e. Defendants rem oved the action to this Court on Septem ber 30 , 20 13. On April 29, 20 14, ruling on J P Morgan’s Motion for J udgm ent on the Pleadings, this Court concluded that Plaintiffs’ Com plaint was barred on res judicata grounds. See ECF Nos. 29, 30 . Plaintiffs filed a Motion for Reconsideration on May 27, 20 14, which this Court denied on J uly 31, 20 14. See ECF Nos. 47, 48. Plaintiffs then appealed this Court’s decision to the United States Court of Appeals for the Fourth Circuit (the “Fourth Circuit”). On March 10 , 20 15, the Fourth Circuit vacated this Court’s judgm ent and rem anded the case for further proceedings. See ECF Nos. 49, 50 . Specifically, the Fourth Circuit “determ ined that the state court order was not a final order,” (ECF No. 49 at 2), because “[t]he action is still proceeding on the Buzzell’s claim against Sam uel I. White,” id. at 4. Defendant filed the instant Motion on August 5, 20 15, seeking to stay the instant action pending the resolution of Plaintiffs’ 20 0 8 Lancaster Circuit Court action. II. LEGAL STAN D ARD It is well established that this Court possesses the inherent power to stay proceedings and to “prom ote ‘econom y of tim e and effort for itself, for counsel and for litigants.’’’ Robinson v. DePuy Orthopaedics, Inc., 3:12-CV-3, 20 12 WL 831650 , at * 2 (W.D. Va. March 6, 20 12) (quoting Landis v. N . Am . Co., 299 U.S. 248 , 254 (1936)). “The decision of whether or not to stay a case pending in district court lies within the sound discretion of the court to control its docket, absent a statute rem oving that discretion.” Linear Prods. v. Marotech, Inc., 189 F. Supp. 2d 461, 463 (W.D. Va. 20 0 2) (internal citations om itted); see Landis, 299 U.S. at 254-55. “The party seeking a stay m ust justify it by clear and convincing circum stances outweighing 2 potential harm to the party against whom it is operative.” W illiford v. Arm strong W orld Indus., Inc., 715 F.2d 124, 127 (4th Cir. 1983). In considering a m otion to stay, a district court m ust “weigh com peting interests and m aintain an even balance.” Yearw ood v. Johnson & Johnson, Civil Action No. RDB– 12– 1374, 20 12 WL 2520 865, at *3 (D. Md. J une 27, 20 12). Specifically, a district court should consider three factors: “(1) the interests of judicial econom y; (2) hardship and equity to the m oving party if the action is not stayed; (3) potential prejudice to the non-m oving party.” Johnson v. DePuy Orthopaedics, Inc., 3:12-CV-2274, 20 12 WL 4538642, at *2 (D.S.C. Oct. 1, 20 12) (quoting Mey ers v. Bay er AG, 143 F. Supp. 2d 10 44, 10 49 (E.D. Wis. 20 0 1)). III. D ISCU SSION a. Pa r t ie s ’ Ar g u m e n t s i. Defendant’s Argum ents First, Defendant argues that all necessary parties are present in both actions as plaintiffs are parties to both action and Defendant is in privity with the Lenders for purposes of res judicata. Next, Defendant argues that staying this action serves the interests of convenience, judicial econom y, and com ity. Defendant subm its that once the state court issues a final order as to SIW, then this Court m ay swiftly consider a second m otion by Defendant on the issue of whether Plaintiffs’ claim s alleged in this action are barred under res judicata. In other words, disposition of the 20 0 8 state court action will m ost certainly resolve critical issues raised in the instant action. Third, Defendant argues that requiring it to continue litigating this action would result in hardship and inequity. The sole reason the Fourth Circuit vacated this Court’s judgm ent was because a final order had not yet been entered in the 20 0 8 state court action. Thus, any tim e and costs expended in proceeding with discovery, dispositive m otions and trial will presum ably be com pleted wasted once a final order is entered in the state action. 3 In sum , Defendant argues that the inevitable issuance of a final order in state court will provide Defendant with the final elem ent of its res judicata argum ent in this action. Therefore, Defendant should not be required to continue litigating this case until that action is resolved. ii. Plaintiffs’ Response Plaintiffs assert that a stay of the instan t action does not serve the interest of convenience, judicial econom y, and com ity. Rather, Plaintiffs argue, the instant Motion dem onstrates another tactic of Defendant’s counsel to delay trial. Plaintiffs assert that they suffered significant hardship directly caused by Defendant and insist that Defendant is not a party to the state court action. iii. Defendant’s Reply Defendant asserts that Plaintiff’s position that Defendant is not a party to the state court action is m eritless. To support its position, Defendant argues that the Fourth Circuit did not reverse this Court’s holding in its J uly 31, 20 14 Mem orandum Opinion that “privity is present between J P Morgan and the Lenders in the state court case.” Def.’s Opp’n at 1 (citing ECF No. 42). Thus, says Defendant, once a final order is issued in the state court action, this action m ay be properly dism issed on res judicata grounds. Furtherm ore, Defendant argues that, although the Fourth Circuit rem anded the case to this Court “for further proceedings consistent with the court’s decision,” the Fourth Circuit did not preclude this Court from issuing a brief stay of this case until a final order is entered in the state court action. Persuasively, Defendant argues that Plaintiffs already presented their dispute to the state court, which ultim ately dism issed the Lenders from the action. As such, Defendant contends that Plaintiffs should not be perm itted to litigate an entirely new case against it solely because the first state court action is not yet final as to the single rem aining defendant. For these reasons, Defendant requests that the Court grant its Motion and enter an Order staying this proceeding pending the issuance of a final order in Plaintiffs’ 20 0 8 state court action filed in Lancaster Circuit Court. 4 b. An a ly s is In considering m otions to stay, the Court considers the potential for “inconvenience to a defendant arising from a m ultiplicity of suits, as well as concern with prom oting efficient judicial adm inistration.” Am dur v. Lizars, 372 F.3d 10 3, 10 7 (4th Cir. 1967). Disposition of the state court act will m ost certainly resolve critical issues raised in the instant action. First, all necessary parties are present in both actions since Defendant is in privity with the Lenders for the purposes of res judicata. Second, although it is som ewhat troubling that Plaintiffs’ 20 0 8 state court action has been proceeding for seven years in the state court, num erous issues have already been resolved and the state court need only resolve the 20 0 8 action as to SIW, the sole rem aining defendant, before issuing a final order. Thus, a brief stay of this proceeding until the conclusion of the state action is necessary, in order to serve the interests of “judicial econom y and com ity” and “avoid the possibility of two separate outcom es” and “the expense of litigating the sam e issues twice.” Veteran Eng'g Grp., Inc. v. CSI Eng'g, P.C., No. 11-CV-0 2530 -AW, 20 11 WL 5826673, at *4 (D. Md. Nov. 17, 20 11). Further, it is clear that hardship and equity to Defendant will result if the action is not stayed. Requiring Defendant to continue litigating this case will result in significant hardship since the sole reason this Court’s decision on Defendant’s Motion for J udgm ent on the Pleadings was reversed by the Fourth Circuit was because a final order has not yet been entered in the state court action. Thus, as Defendant argues, any tim e and costs expended in proceeding with discovery, dispositive m otions, and trial will presum ably be wasted once a final order is entered in the 20 0 8 state court action; allowing Plaintiffs a second bite at the apply by perm itting this case to proceed sim ultaneously with the state court action would be unfair to Defendant. IV. CON CLU SION For the aforem entioned reasons, the Court hereby GRANTS Defendant’s Motion. ECF No. 57. The Court will lift the stay upon notice by the parties that the state court action has been resolved. 5 Let the Clerk send a copy of this Mem orandum Opinion to all counsel of record and to Plaintiffs. An appropriate Order shall issue. ____________________/s/_________________ James R. Spencer Senior U. S. District Judge ENTERED this _ 9th_ _ _ _ day of Septem ber 20 15. 6
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