1 2 3 4
5 6 7 UNITED STATES DISTRICT COURT 8 WESTERN DISTRICT OF WASHINGTON AT TACOMA 9 10 ALAA ELKHARWILY, CASE NO. 3:24-cv-05720-DGE 11 Plaintiff, ORDER DENYING SECOND 12 v. MOTION FOR TEMPORARY RESTRAINING ORDER (DKT. NO. 13 FIRST INTERSTATE BANK, 13) 14 Defendant. 15
16 Before the Court is Plaintiff’s second motion for a temporary restraining order to restrain 17 a trustee’s sale by Defendants of seven parcels of real property. (Dkt. No. 13.) The property in 18 question involves seven properties located in Washington, one in Snohomish County and six in 19 Spokane County. (Dkt. No. 13 at 31–32.) The Court denied Plaintiff’s first motion for a 20 temporary restraining order without prejudice due to several deficiencies with Plaintiff’s motion. 21 (Dkt. No. 2.) 22 23 24 1 A. No Proof of Service 2 Defendant LPSL Corporate Services, Inc. asserts “[t]here has been no service of the 3 amended complaint” on it. (Dkt. No. 17 at 1.) Plaintiff filed a declaration of service for each 4 Defendant. (See Dkt. Nos. 15–16.) Each declaration of service identifies that the amended
5 complaint, amended motion for restraining order, and the amended notice of amended motion for 6 restraining order were hand-delivered to specific persons at each Defendant’s business address. 7 (Id.) However, the declarations of service do not identify that a summons was served. They also 8 do not identify what authority the individuals who received the identified documents have to 9 accept service of process on behalf of each Defendant. 10 The Court has no personal jurisdiction over a defendant absent service. “The validity of 11 an order of a federal court depends upon that court's having jurisdiction over both the subject 12 matter and the parties.” Ins. Corp. of Ir., Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 13 694, 701 (1982). Personal jurisdiction “is an essential element of the jurisdiction of a 14 district . . . court, without which the court is powerless to proceed to an adjudication.” Ruhrgas
15 AG v. Marathon Oil Co., 526 U.S. 574, 584 (1999) “Before a federal court may exercise 16 personal jurisdiction over a defendant, the procedural requirement of service of summons must 17 be satisfied.” Omni Capital Int'l, Ltd. v. Rudolf Wolff & Co., 484 U.S. 97, 104 (1987); see also 18 Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 350 (1999) (“In the absence of 19 service of process (or waiver of service by the defendant), a court ordinarily may not exercise 20 power over a party the complaint names as defendant.”). 21 Because there is insufficient proof of service, the Court lacks authority to enter any order 22 against either Defendant. 23
24 1 B. Even if Service Was Proper, The Record Is Insufficient to Support Entry of a Restraining Order. 2 The dispute originates out of a Business Loan Agreement and Promissory Note between 3 Wall Street Apartments, LLC (“LLC”) and Defendant First Interstate Bank’s predecessor. (Dkt. 4 No. 7 at 57–68.) Plaintiff was the guarantor of this loan transaction. (Dkt. No. 11 at 4.) The 5 LLC and Plaintiff defaulted on the loan and eventually a state court appointed a receiver on 6 behalf of the LLC at Defendant First Interstate Bank’s request. (Dkt. No. 7 at 164–179.) 7 After this, Plaintiff reached an agreement with Defendant First Interstate Bank to resolve 8 the loan default by executing a Loan Modification Agreement. (Dkt. No. 20-11.) As part of the 9 Loan Modification Agreement, Plaintiff executed and delivered five deeds of trust to Defendant 10 First Interstate Bank, agreed to make certain payments to cure the default, and otherwise agreed 11 to a certain payment plan. (Id. at 5–9.) Plaintiff also pledged and assigned to Defendant First 12 Interstate Bank a certificate of deposit in the amount of $68,850. (Id. at 5.) The deeds of trust 13 and the certificate of deposit were referred to as the Replacement Collateral. (Id.) In exchange, 14 Defendant First Interstate Bank agreed to move to terminate the receivership of the LLC and 15 reconvey to the LLC the deed of trust. (Id.) 16 Plaintiff asserts Defendant First Interstate Bank failed to comply with the terms of the 17 Loan Modification Agreement such that Defendant First Interstate Bank’s lacked authority to 18 initiate a trustee’s sale of any of the encumbered properties. Plaintiff argues he is not in breach 19 the terms of Loan Modification Agreement and that he has made payments or has tendered 20 payments to Defendant First Interstate Bank. The Court, however, is unable to discern from 21 Plaintiff’s documents the payments Plaintiff allegedly tendered, when they were tendered, or 22 23 24 1 how they were tendered.1 (See generally Dkt. No. 7 at 128–158.) Plaintiff also presents a 2 voluminous set of documents with minimal citation to the record.2 Plaintiff also claims the 3 Defendant First Interstate Bank did not apply any of the $68,850 contained in the certificate of 4 deposit towards the monthly payment owed under the Loan Modification Agreement. (Dkt. No.
5 27 at 5.) 6 In contrast, Defendant First Interstate Bank provides a history of its interactions with 7 Plaintiff and provides supporting documents. Defendant First Interstate Bank specifically 8 identifies payments were not timely made and provides copies of the communications with 9 Plaintiff regarding payments owed under the Loan Modification Agreement. (Dkt. Nos. 20 at 5– 10 6; 20-13; 20-14.) The Loan Modification Agreement also specifically identifies the certificate of 11 deposit was to be part of the Replacement Collateral to be used in the event of default. (Dkt. No. 12 20-11 at 5.) The Loan Modification Agreement does not state Defendant First Interstate Bank 13 was required to apply the funds in the certificate of deposit towards the monthly payment 14 obligation. In short, the record currently before the Court does not support Plaintiff’s contention
15 that he met the payment schedule contained in the Loan Modification Agreement. 16 Plaintiff also argues Defendant First Interstate Bank failed to enter an order terminating 17 the LLC’s receivership. (Dkt. No. 13 at 17.) At the same time, Plaintiff provides a copy of an 18 1 Plaintiff also references “making the monthly payment in the designated method of payment at 19 Chase Bank” and “the refusal of the bank to ‘receive’ the payment by and through its own self- induced refusal to withdraw the payments as authorized. (Dkt. No. 27 at 7.) It is unclear what 20 Plaintiff is referring to and the purported “Exhibit U” is not included with Plaintiff’s declaration. (Dkt. No. 27-4 is “Exhibit T and Dkt. No. 27-5 is “Exhibit V Part 1.”) 21 2As an example, Plaintiff filed three exhibits on September 5, 2024 totaling over 1,000 pages, but provides no guidance as to exactly which documents support Plaintiff’s position. (See Dkt. Nos. 22 24–25.) Without citation to specific pages in the record, the Court’s is not equipped to identify what Plaintiff believes is important for the Court to consider. See United States v. Dunkel, 927 23 F.2d 955, 956 (7th Cir. 1991) (“Judges are not like pigs, hunting for truffles buried in [the record].”). 24 1 objection filed by the LLC’s receiver seeking modifications to the proposed stipulated order 2 terminating the receivership that Plaintiff signed with Defendant First Interstate Bank. (Dkt. No. 3 7 at 258–261.) Defendant First Interstate Bank also points out that it attempted to address the 4 receiver’s objections with Plaintiff but that ultimately no agreement on the proposed
Free access — add to your briefcase to read the full text and ask questions with AI
1 2 3 4
5 6 7 UNITED STATES DISTRICT COURT 8 WESTERN DISTRICT OF WASHINGTON AT TACOMA 9 10 ALAA ELKHARWILY, CASE NO. 3:24-cv-05720-DGE 11 Plaintiff, ORDER DENYING SECOND 12 v. MOTION FOR TEMPORARY RESTRAINING ORDER (DKT. NO. 13 FIRST INTERSTATE BANK, 13) 14 Defendant. 15
16 Before the Court is Plaintiff’s second motion for a temporary restraining order to restrain 17 a trustee’s sale by Defendants of seven parcels of real property. (Dkt. No. 13.) The property in 18 question involves seven properties located in Washington, one in Snohomish County and six in 19 Spokane County. (Dkt. No. 13 at 31–32.) The Court denied Plaintiff’s first motion for a 20 temporary restraining order without prejudice due to several deficiencies with Plaintiff’s motion. 21 (Dkt. No. 2.) 22 23 24 1 A. No Proof of Service 2 Defendant LPSL Corporate Services, Inc. asserts “[t]here has been no service of the 3 amended complaint” on it. (Dkt. No. 17 at 1.) Plaintiff filed a declaration of service for each 4 Defendant. (See Dkt. Nos. 15–16.) Each declaration of service identifies that the amended
5 complaint, amended motion for restraining order, and the amended notice of amended motion for 6 restraining order were hand-delivered to specific persons at each Defendant’s business address. 7 (Id.) However, the declarations of service do not identify that a summons was served. They also 8 do not identify what authority the individuals who received the identified documents have to 9 accept service of process on behalf of each Defendant. 10 The Court has no personal jurisdiction over a defendant absent service. “The validity of 11 an order of a federal court depends upon that court's having jurisdiction over both the subject 12 matter and the parties.” Ins. Corp. of Ir., Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 13 694, 701 (1982). Personal jurisdiction “is an essential element of the jurisdiction of a 14 district . . . court, without which the court is powerless to proceed to an adjudication.” Ruhrgas
15 AG v. Marathon Oil Co., 526 U.S. 574, 584 (1999) “Before a federal court may exercise 16 personal jurisdiction over a defendant, the procedural requirement of service of summons must 17 be satisfied.” Omni Capital Int'l, Ltd. v. Rudolf Wolff & Co., 484 U.S. 97, 104 (1987); see also 18 Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 350 (1999) (“In the absence of 19 service of process (or waiver of service by the defendant), a court ordinarily may not exercise 20 power over a party the complaint names as defendant.”). 21 Because there is insufficient proof of service, the Court lacks authority to enter any order 22 against either Defendant. 23
24 1 B. Even if Service Was Proper, The Record Is Insufficient to Support Entry of a Restraining Order. 2 The dispute originates out of a Business Loan Agreement and Promissory Note between 3 Wall Street Apartments, LLC (“LLC”) and Defendant First Interstate Bank’s predecessor. (Dkt. 4 No. 7 at 57–68.) Plaintiff was the guarantor of this loan transaction. (Dkt. No. 11 at 4.) The 5 LLC and Plaintiff defaulted on the loan and eventually a state court appointed a receiver on 6 behalf of the LLC at Defendant First Interstate Bank’s request. (Dkt. No. 7 at 164–179.) 7 After this, Plaintiff reached an agreement with Defendant First Interstate Bank to resolve 8 the loan default by executing a Loan Modification Agreement. (Dkt. No. 20-11.) As part of the 9 Loan Modification Agreement, Plaintiff executed and delivered five deeds of trust to Defendant 10 First Interstate Bank, agreed to make certain payments to cure the default, and otherwise agreed 11 to a certain payment plan. (Id. at 5–9.) Plaintiff also pledged and assigned to Defendant First 12 Interstate Bank a certificate of deposit in the amount of $68,850. (Id. at 5.) The deeds of trust 13 and the certificate of deposit were referred to as the Replacement Collateral. (Id.) In exchange, 14 Defendant First Interstate Bank agreed to move to terminate the receivership of the LLC and 15 reconvey to the LLC the deed of trust. (Id.) 16 Plaintiff asserts Defendant First Interstate Bank failed to comply with the terms of the 17 Loan Modification Agreement such that Defendant First Interstate Bank’s lacked authority to 18 initiate a trustee’s sale of any of the encumbered properties. Plaintiff argues he is not in breach 19 the terms of Loan Modification Agreement and that he has made payments or has tendered 20 payments to Defendant First Interstate Bank. The Court, however, is unable to discern from 21 Plaintiff’s documents the payments Plaintiff allegedly tendered, when they were tendered, or 22 23 24 1 how they were tendered.1 (See generally Dkt. No. 7 at 128–158.) Plaintiff also presents a 2 voluminous set of documents with minimal citation to the record.2 Plaintiff also claims the 3 Defendant First Interstate Bank did not apply any of the $68,850 contained in the certificate of 4 deposit towards the monthly payment owed under the Loan Modification Agreement. (Dkt. No.
5 27 at 5.) 6 In contrast, Defendant First Interstate Bank provides a history of its interactions with 7 Plaintiff and provides supporting documents. Defendant First Interstate Bank specifically 8 identifies payments were not timely made and provides copies of the communications with 9 Plaintiff regarding payments owed under the Loan Modification Agreement. (Dkt. Nos. 20 at 5– 10 6; 20-13; 20-14.) The Loan Modification Agreement also specifically identifies the certificate of 11 deposit was to be part of the Replacement Collateral to be used in the event of default. (Dkt. No. 12 20-11 at 5.) The Loan Modification Agreement does not state Defendant First Interstate Bank 13 was required to apply the funds in the certificate of deposit towards the monthly payment 14 obligation. In short, the record currently before the Court does not support Plaintiff’s contention
15 that he met the payment schedule contained in the Loan Modification Agreement. 16 Plaintiff also argues Defendant First Interstate Bank failed to enter an order terminating 17 the LLC’s receivership. (Dkt. No. 13 at 17.) At the same time, Plaintiff provides a copy of an 18 1 Plaintiff also references “making the monthly payment in the designated method of payment at 19 Chase Bank” and “the refusal of the bank to ‘receive’ the payment by and through its own self- induced refusal to withdraw the payments as authorized. (Dkt. No. 27 at 7.) It is unclear what 20 Plaintiff is referring to and the purported “Exhibit U” is not included with Plaintiff’s declaration. (Dkt. No. 27-4 is “Exhibit T and Dkt. No. 27-5 is “Exhibit V Part 1.”) 21 2As an example, Plaintiff filed three exhibits on September 5, 2024 totaling over 1,000 pages, but provides no guidance as to exactly which documents support Plaintiff’s position. (See Dkt. Nos. 22 24–25.) Without citation to specific pages in the record, the Court’s is not equipped to identify what Plaintiff believes is important for the Court to consider. See United States v. Dunkel, 927 23 F.2d 955, 956 (7th Cir. 1991) (“Judges are not like pigs, hunting for truffles buried in [the record].”). 24 1 objection filed by the LLC’s receiver seeking modifications to the proposed stipulated order 2 terminating the receivership that Plaintiff signed with Defendant First Interstate Bank. (Dkt. No. 3 7 at 258–261.) Defendant First Interstate Bank also points out that it attempted to address the 4 receiver’s objections with Plaintiff but that ultimately no agreement on the proposed
5 modifications was ever reached and that Plaintiff subsequently sought to stay the proceedings.3 6 (Dkt. No. 21 at 2–3; see also Dkt. No. 21-9.) 7 Plaintiff also argues that the “Bank failed to send a single notice of any purported default 8 by email or even otherwise to Plaintiff as required by the loan documents[.]” (Dkt. No. 13 at 9 23.) But, as Defendant First Interstate Bank points out, the Loan Modification Agreement states 10 that upon default the loan obligation “shall be immediately due and payable without notice of 11 any kind” and that Defendant First Interstate Bank was “entitled to enforce its rights and 12 remedies . . . without further notice or demand, including without limitation, the foreclosure of 13 the . . . Deeds of Trust” and the Replacement Collateral. (Dkt. No. 20-11 at 11.) And it appears 14 Plaintiff was aware Defendant First Interstate Bank asserted a default had occurred based on the
15 16 3 It is unclear whether the state court proceedings involving the receiver remains pending on 17 appeal in the state courts. (See generally Dkt. No. 24.) To the extent Plaintiff seeks to challenge state court judgments related to the receiver, this Court likely does not have jurisdiction over 18 Plaintiff’s claims pursuant to the Rooker–Feldman doctrine. “If a federal plaintiff asserts as a legal wrong an allegedly erroneous decision by a state court, and seeks relief from a state court 19 judgment based on that decision, Rooker–Feldman bars subject matter jurisdiction in federal district court.” Noel v. Hall, 341 F.3d 1148, 1164 (9th Cir. 2003). 20 A party disappointed by a decision of a state court may seek reversal of that decision by appealing to a higher state court. A party disappointed by a 21 decision of the highest state court in which a decision may be had may seek reversal of that decision by appealing to the United States Supreme Court. 22 In neither case may the disappointed party appeal to a federal district court, even if a federal question is present or if there is diversity of citizenship 23 between the parties. Id. at 1155. 24 1 email communications between Plaintiff and Defendant First Interstate Bank. (See Dkt. Nos. 20- 2 13, 20-14.) 3 A temporary restraining order (“TRO”), as with any preliminary injunctive relief, is an 4 extraordinary remedy, “never awarded as of right.” Winter v. Natural Res. Def. Council, Inc.,
5 555 U.S. 7, 24 (2008). A TRO “should not be granted unless the movant, by a clear showing, 6 carries the burden of persuasion.” Mazurek v. Armstrong, 520 U.S. 968, 972 (1997) (quotation 7 marks and citation omitted). A party seeking a TRO must establish (1) a likelihood of success on 8 the merits (2) a likelihood of irreparable harm in the absence of preliminary relief; (3) a 9 balancing of equities tips in favor of a TRO; and (4) an injunction is in the public interest. 10 Winter, 555 U.S. at 20. Alternatively, a plaintiff may obtain relief if they (1) demonstrate a 11 serious question going to the merits has been raised; (2) the balance of hardships tips sharply in 12 plaintiff’s favor; (3) irreparable harms is likely to occur; and (4) relief is in the public interest. 13 Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1134–1135 (9th Cir. 2021). 14 Plaintiff bases his request for a temporary restraining order on Washington Revised Code
15 § 61.24.130. That statute allows for a “borrower, grantor, any guarantor, or any person who has 16 an interest” in the subject property the ability to restrain “on any proper legal or equitable 17 ground, a trustee’s sale.” Wash. Rev. Code § 61.24.130(1). 18 Plaintiff has not his met his burden of persuasion. The present record does not support a 19 finding Plaintiff meets the requirements for a TRO. The present record does not presently 20 establish Plaintiff’s likely success on the merits or demonstrate a serious question going to the 21 merits. As already stated, it is not the Court’s task to comb through the record to find facts and 22 arguments that would support Plaintiff’s motion. Dunkel, 927 F.2d at 956. In short, the record 23
24 1 currently before the Court does not support a “proper legal or equitable ground” as required by 2 Washington Revised Code § 61.24.130(1). 3 C. Plaintiff’s Additional Motions (Dkt. Nos. 28, 29) 4 On September 5, 2024, Plaintiff filed two motions titled “Motion to Stay Court Order if
5 Denying the Amended Motion to Restrain the Sale Pending Appeal and to Kindly Consider 6 Allowing More Time in Accommodation of Plaintiff’s Disability.” (Dkt. Nos. 28, 29.) One was 7 filed at 10:14 p.m. and the other was filed at 10:57 p.m. 8 First, these motions have no impact on the Court’s lack of jurisdiction over a party where 9 there is no proof a summons was properly served. Second, even if service had been perfected, 10 Plaintiff does not identify the authority the Court would have to “stay” a denial of a motion for a 11 TRO in the manner Plaintiff suggests.4 12 Plaintiff’s second motion for a temporary restraining order (Dkt. No. 13) is DENIED 13 based on lack of proper service and based on the record presented. Likewise, Plaintiff’s two 14 motions to stay (Dkt. Nos. 28, 29) also are DENIED.
15 Dated this 6th day of September, 2024. 16 A 17 David G. Estudillo 18 United States District Judge 19 20
4 Plaintiff also asks the court to “consider accommodation for his disability” without making 21 clear what accommodation is being sought. (Dkt. No. 28 at 5.) A reasonable accommodation normally entails “mechanisms to remove barriers or provide assistance to disabled individuals so 22 that they can perform essential functions.” Quinones v. Potter, 661 F. Supp. 2d 1105, 1123 (D. Ariz. 2009) (quotation marks omitted.) Plaintiff has not identified any Court procedural barriers 23 that should be removed or any additional assistance that should be provided to allow Plaintiff to proceed with his arguments. 24