Bush v. Reliant Bank

District Court, M.D. Tennessee·Decided June 30, 2022·No. 3:21-cv-00525·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE NASHVILLE DIVISION

BYRON V. BUSH and KELLY DIANE ) BUSH, ) ) Plaintiffs, ) No. 3:21-cv-00525 ) JUDGE RICHARDSON v. ) ) RELIANT BANK, et al., ) ) Defendants. ) ) )

MEMORANDUM OPINION AND ORDER Pending before the Court is a Report and Recommendation (“R&R”) of the Magistrate Judge (Doc. No. 55) recommending Defendants’ respective motions to dismiss (Docs. No. 27 and 33, collectively “Motions”) be granted. Defendants Reliant Bank, Reliant Bancorp, Inc., William Ronald DeBerry, DeVan D. Ard, Jr., and Rick Belote (collectively, “Reliant Defendants”) filed the first motion to dismiss (Doc. No. 27). Defendants Court of Appeal Judges Frank Clement and Steven Stafford, and Chancellor James Martin III (collectively, “Judicial Defendants”) filed the second motion to dismiss (Doc. No. 33). The R&R recommended, more specifically, that Plaintiffs’ case be dismissed for lack of jurisdiction. (Doc. No. 55 at 18). Plaintiffs filed an objection (Doc. No. 56, “Objection”) to the R&R’s recommendation that Plaintiffs’ claims be dismissed. Defendants filed a response to Plaintiffs’ objections (Doc. No. 57, “Response”) and Plaintiffs did not file a reply. When a magistrate judge issues a report and recommendation regarding a dispositive pretrial matter, the district court must review de novo any portion of the report and recommendation to which a proper objection is made. Fed. R. Civ. P. 72(b)(3). The district judge may accept, reject, or modify the recommended disposition, review further evidence, or return the matter to the magistrate judge with instructions. Id. Fed. R. Civ. P. 72(b)(2) provides that a party may file “specific written objections” to a report and recommendation, and Local Rule 72.02(a) provides that “[s]uch objections must be

written, must state with particularity the specific portions of the Magistrate Judge’s report or proposed findings or recommendations to which an objection is made.”1 Pursuant to 28 U.S.C. § 636(b)(1)(C) and Fed. R. Civ. P. 72(b)(3), the Court has reviewed de novo the Report and Recommendation, the Objections, the Response, and the file. For the reasons set forth below, Plaintiffs’ Objection is overruled, and the R&R is adopted and approved. BACKGROUND The facts are aptly set forth in the R&R and need not be repeated here in full. However, the Court will provide a brief overview. The initial groundwork for this claim was laid in 2014 when Defendant Reliant Bank

brought a lawsuit against Plaintiffs for failure to repay their commercial real property loan, which ended in a foreclosure sale. (Doc. No. 55 at 5). Defendant Judge James G. Martin, III, of the 21st Judicial District of Tennessee, found in favor of Defendant Reliant Bank and upheld the foreclosure sale price. (Id.). Plaintiffs appealed this decision, specifically alleging that the parties agreed to a nonrecourse note, which (according to Plaintiff) Reliant Bank breached when it sought to hold Plaintiffs personally liable for the debt. The Tennessee Court of Appeals affirmed the lower

1 The Local Rule also provides that any objections must be accompanied by sufficient documentation including, but not limited to, affidavits, pertinent exhibits, and if necessary, transcripts of the record to apprise the District Judge of the bases for the objections. court’s finding that all parties did in fact intend a full recourse note. Com. Union Bank, Brentwood, Tennessee v. Bush, 512 S.W.3d 217, 232 (Ct. App. Tenn. 2016) (hereinafter Bush). Before the Tennessee Court of Appeals decided the aforementioned case, Plaintiffs filed a pro se complaint against Reliant Bank in Chancery Court for the 21st Judicial District of Tennessee, which the trial court dismissed on several grounds. (Doc. No. 55 at 6). Plaintiffs

appealed, and the Tennessee Court of Appeals affirmed the dismissal based on the doctrine of prior suit pending. (Id.) (citing Bush v. Com. Union Bank, 523 S.W.3d 56, 61 (Tenn. Ct. App. 2017)). After the Tennessee Court of Appeals affirmed dismissal of the second lawsuit, Plaintiffs filed a pro se Motion for Relief from the final judgement under Tenn. R. Civ. P. 60.02, “rais[ing] the same allegations of fraud against Reliant Bank and Judge Martin that are presently before this Court, and that the Tennessee Court of Appeals had previously considered and rejected.” (Id.). The trial court reduced the deficiency judgment against Plaintiffs, Reliant Bank appealed, and the Tennessee Court of Appeals reversed, reasoning that Plaintiffs’ Rule 60.02 motion should have been dismissed as untimely filed. (Id. at 6–7) (citing Reliant Bank v. Bush, 2018 WL 6828881, at

*2 (Tenn. Ct. App. 2018)). Finally, in 2019, Plaintiffs filed a “Motion Requesting Independent Action by the Court for ‘Fraud Upon the Court’ by Judge James G. Martin III and TN Appellate Judge Frank Clement” in Williamson County Chancery Court, which reiterated their allegations of fraud against Reliant Bank and Judge Martin and included new allegations against Tennessee Court of Appeals Judge Frank Clement. (Id. at 7). The Chancery Court ruled against Plaintiffs, and the Tennessee Court of Appeals affirmed its decision. See Reliant Bank v. Bush, 631 S.W.3d 1, 4 (Tenn. Ct. App. 2021).2 DISCUSSION

2 In each of the four state cases, Plaintiffs applied for permission to appeal to the Tennessee Supreme Court and were denied each time. Plaintiffs object to many of the R&R recommendations, which will each be addressed in turn. A. Procedural Objections To begin with, Plaintiffs object to Judge Frensley issuing his R&R for this case, claiming they “never consented” to a trial before a Magistrate Judge, citing to the Practice and Procedure

Manual for Judges and Magistrate Judges for the Middle District of Tennessee written by Judge Frensley. (Doc. No. 56 at 2). Plaintiffs correctly note that the Manual states that Judge Frensley will only “rule on dispositive motions when the parties consent to trial before a Magistrate Judge.” Practice and Procedure Manual at 3. However, Judge Frensley does not himself rule on a dispositive motion when he issues an R&R recommending to the District Judge how to rule on a motion. Instead, under Fed. R. Civ. P. 72(b), a magistrate judge may “enter a recommended disposition” as to a dispositive motion, and then the District Judge decides whether to “accept, reject, or modify the recommended disposition.” In this way, the district judge, and not the magistrate judge, ultimately rules on the dispositive motion. This is what has (properly) taken place

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