The plaintiff’s request was denied after the court declared him a “vexatious litigant.”
06/05/2024 1:20 P.M.
2.5 minute read
In a recent court order (PDF), a plaintiff’s request for a proposed complaint was denied because of his past behavior as a “vexatious litigant” for attempting to invalidate his bankruptcy status on a previous case against Wells Fargo and HSBC Bank.
Background
On April 15, 2024, Sung Ho Mo (plaintiff) sought court permission to file an adversary complaint against HSBC Bank USA, Wells Fargo Bank, and some of their officers. The complaint aimed to invalidate Wells Fargo’s secured status and seek damages for allegedly filing a false proof of claim in the plaintiff’s bankruptcy case and for violation of the Fair Debt Collection Practices Act.
The HSBC parties opposed the request. Despite an unauthorized supplement to the plaintiff’s response, the court carefully reviewed all submissions and denied the request for several reasons.
The court had previously declared the plaintiff a vexatious litigant on March 31, 2023, restricting him from filing pleadings seeking relief that had been repeatedly denied. The complaint aimed to invalidate HSBC’s secured claim—a relief the plaintiff had unsuccessfully sought multiple times. The court found that allowing the new complaint would violate the vexatious litigant order and continue the plaintiff’s pattern of litigation aimed at invalidating the same foreclosure judgment.
Decision
The court identified multiple substantive grounds for denying the request. First, res judicata bars relitigation of claims that were already decided or those that could have been raised in previous litigation. HSBC had obtained a final foreclosure judgment on June 10, 2022, which the plaintiff did not appeal. The court had previously dismissed the plaintiff’s similar claims based on res judicata, and the same reasoning applied again.
Collateral estoppel prevents rearguing issues already litigated and essential to a prior judgment. The validity of the promissory note was litigated and upheld in the foreclosure action. The court found the plaintiff’s new allegations about differences in the promissory notes insufficient to circumvent this doctrine, as they were essentially the same arguments previously made.
Lastly, the Rooker-Feldman doctrine bars federal courts from reviewing state court judgments. The plaintiff’s complaint sought to invalidate the state court foreclosure judgment, which the federal court could not do. Accepting the plaintiff’s arguments would effectively undo the state court’s final judgment, which is impermissible under this doctrine.
Potential Sanctions
The court noted that the allegations of different endorsements on the promissory notes were not fraudulent but reflected normal procedural developments over time. The court emphasized the plaintiff’s history of baseless and vexatious litigation and warned that continued frivolous filings could expose him to sanctions. The HSBC parties were granted 30 days to request sanctions against the plaintiff, with a subsequent briefing schedule set for responses and replies.
Subsequently, the court denied the plaintiff’s request to file the proposed complaint due to his vexatious litigant status, the jurisdictional transfer to the appellate court, and the application of res judicata, collateral estoppel, and the Rooker-Feldman doctrine.
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