Lysyy v. Deutsche Bank National Trust Company

District Court, W.D. Washington·Decided May 28, 2024·No. 2:24-cv-00062·Unknown

Opinion

1 2

3 4 5 6 7 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON 8 AT SEATTLE

9 10 TATYANA LYSYY, et al., CASE NO. C24-0062JLR 11 Plaintiffs, ORDER v. 12 DEUTSCHE BANK NATIONAL 13 TRUST COMPANY, et al., 14 Defendants. 15 I. INTRODUCTION 16 On April 3, 2024, the court issued an order (1) denying Plaintiffs Tatyana Lysyy 17 and Vasiliy Lysyy’s (together, “Plaintiffs”) motion to remand; (2) granting in part and 18 denying in part Defendants Deutsche Bank National Trust Company, as Trustee on 19 Behalf of the Holders of the Impac Secured Assets Corp. Mortgage Pass-Through 20 Certificates Series 2007-1 (the “Trust”), Select Portfolio Servicing, Inc. (“SPS”), 21 Safeguard Properties Management, LLC (“Safeguard”), and Residential RealEstate 22 1 Review, Inc.’s (“RRR”) (collectively, “Defendants”) motion for summary judgment; 2 (3) denying Plaintiffs’ request for discovery pursuant to Federal Rule of Civil Procedure

3 56(d); (4) ordering Plaintiffs to show cause, pursuant to Rule 56(f), why the court should 4 not dismiss their claims for violations of due process and of the automatic bankruptcy 5 stay; and (5) granting Defendants leave to file a reply in support of dismissal of those 6 claims. (4/3/24 Order (Dkt. # 54); see MTR (Dkt. # 31); MSJ (Dkt. # 14).1) On April 17, 7 2024, Plaintiffs filed a motion for reconsideration of the portions of the order in which 8 the court denied their motion to remand and granted Defendants’ motion for summary

9 judgment on their trespass and Washington Consumer Protection Act (“WCPA”) claims. 10 (MFR (Dkt. # 60).) The court ordered Defendants to respond to the motion and granted 11 Plaintiffs leave to file a reply. (4/18/24 Order (Dkt. # 62).) 12 Briefing on the order to show cause and the motion for reconsideration was 13 complete on May 3, 2024. (See OSC Resp. (Dkt. # 61); OSC Reply (Dkt. # 63); MFR

14 Resp. (Dkt. # 64); MFR Reply (Dkt. # 65).) The court has reviewed the parties’ 15 submissions, the relevant portions of the record, and the governing law. Being fully 16 advised, the court (1) GRANTS in part and DENIES in part Plaintiffs’ motion for 17 reconsideration; (2) DISMISSES Plaintiffs’ due process claims with prejudice; and 18 (3) DISCHARGES its order to show cause with respect to Plaintiffs’ claim for violation

19 of the automatic bankruptcy stay. 20

1 The motion for summary judgment was also filed on behalf of former Defendant 21 Mortgage Electronic Registration Systems, Inc. (“MERS”). (See MSJ at 1.) The parties stipulated to dismiss MERS from this action before the motions for summary judgment and 22 remand were fully briefed. (See 2/29/24 Order (Dkt. # 38).) 1 II. ANALYSIS2 2 Because Plaintiffs’ motion for reconsideration implicates, in part, the court’s

3 jurisdiction over this matter, the court begins by addressing that motion before turning to 4 the order to show cause. 5 A. Motion for Reconsideration 6 Plaintiffs ask the court to reconsider its denial of their motion to remand and its 7 dismissal of their trespass and WCPA claims. (See generally MTR.) The court sets forth 8 the standard of review and then considers Plaintiffs’ motion.

9 1. Standard of Review 10 “Motions for reconsideration are disfavored,” and “[t]he court will ordinarily deny 11 such motions in the absence of a showing of manifest error in the prior ruling or a 12 showing of new facts or legal authority which could not have been brought to its attention 13 earlier with reasonable diligence.” Local Rules W.D. Wash. LCR 7(h)(1). “[A] motion

14 for reconsideration should not be granted, absent highly unusual circumstances, unless 15 the district court is presented with newly discovered evidence, committed clear error, or 16 if there is an intervening change in the controlling law.” Marlyn Nutraceuticals, Inc. v. 17 Mucos Pharma GmbH & Co., 571 F.3d 873, 880 (9th Cir. 2009) (quoting 389 Orange St. 18 Partners v. Arnold, 179 F.3d 656, 665 (9th Cir. 1999)). “A motion for reconsideration

19 ‘may not be used to raise arguments or present evidence for the first time when they 20

21 2 The court incorporates into this order the factual and procedural background set forth in its April 3, 2024 order. (See 4/3/24 Order at 3-10.) The court assumes that the reader is familiar 22 with that order. 1 could reasonably have been raised earlier in the litigation.’” Id. (quoting Kona Enters., 2 Inc. v. Est. of Bishop, 229 F.3d 877, 890 (9th Cir. 2000)). “Whether or not to grant

3 reconsideration is committed to the sound discretion of the court.” Navajo Nation v. 4 Confederated Tribes & Bands of the Yakima Indian Nation, 331 F.3d 1041, 1046 (9th 5 Cir. 2003) (citing Kona Enters., 229 F.3d at 883). 6 2. Remand 7 Plaintiffs urge the court to reconsider its denial of their motion to remand on three 8 grounds. First, Plaintiffs assert that the court must remand this case because Defendants

9 did not obtain—and still have not obtained—Defendant Quality Loan Service Company’s 10 (“QLS”) consent before filing their notice of removal. (MFR at 2.) Second, Plaintiffs 11 argue that removal was untimely because the unserved Defendants—the Trust and 12 MERS—appeared in the state court litigation more than a year before they filed their 13 notice of removal. (Id. at 2-6; see MTR at 5 (acknowledging that Plaintiffs never

14 “formally served” the Trust and MERS).) Finally, Plaintiffs assert that the unserved 15 Defendants waived their right to remove by litigating in state court before filing their 16 notice of removal. (MFR at 6.) The court considers each argument below. 17 a. QLS’s Consent 18 In their original motion, Plaintiffs argued that remand was required because

19 Defendants failed to obtain QLS’s affirmative consent to removal under 28 U.S.C. 20 § 1446(b)(2)(A). (MTR at 7; see Not. of Removal (Dkt. # 1) ¶ 25 (“Defendants that have 21 appeared consent or do not object to removal.”).) The court rejected this argument for 22 two reasons. First, the court concluded that this argument “fails because Plaintiffs 1 themselves stipulated that QLS need not ‘participate in the litigation proceedings in any 2 manner’ except to comply with orders for non-monetary relief and cooperate with

3 discovery.” (4/3/24 Order at 12-13 (citing 3/4/24 Sagara Decl. (Dkt. # 41) ¶ 5, Ex. C 4 (“Stipulation of Nonparticipation”) ¶¶ 2-3).) Second, the court concluded that 5 Defendants’ failure to join QLS was curable, even after the 30-day removal deadlines set 6 forth in 28 U.S.C. § 1446(b)(1) and 28 U.S.C. § 1446(b)(3) expired. (Id. at 13 (citing 7 Destfino v. Reiswig, 630 F.3d 952, 956-57 (9th Cir. 2011) (noting that if all properly 8 served defendants did not join in the notice of removal, the district court may allow the

9 removing defendants to cure that defect before entry of judgment)).) 10 Plaintiffs again assert that the court must remand the matter because Defendants 11 have not cured their failure to obtain QLS’s consent before removal.

Free access — add to your briefcase to read the full text and ask questions with AI

Lysyy v. Deutsche Bank National Trust Company, (W.D. Wash. 2024).

Lysyy v. Deutsche Bank National Trust Company (Lysyy v. Deutsche Bank National Trust Company) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Thompson v. Brown
91 F.3d 20 (Fifth Circuit, 1996)
American Fire & Casualty Co. v. Finn
341 U.S. 6 (Supreme Court, 1951)
Destfino v. Reiswig
630 F.3d 952 (Ninth Circuit, 2011)
Cunningham v. Town of Tieton
374 P.2d 375 (Washington Supreme Court, 1962)
Proctor v. Vishay Intertechnology, Inc.
584 F.3d 1208 (Ninth Circuit, 2009)
Hawaii Ex Rel. Louie v. HSBC Bank Nevada, N.A.
761 F.3d 1027 (Ninth Circuit, 2014)
Kris Kenny v. Wal-Mart Stores, Inc.
881 F.3d 786 (Ninth Circuit, 2018)
Thomas Anderson v. State Farm Mutual Auto. Ins.
917 F.3d 1126 (Ninth Circuit, 2019)
Vinod Sharma v. Hsi Asset Loan Obligation Trust
23 F.4th 1167 (Ninth Circuit, 2022)
389 Orange Street Partners v. Arnold
179 F.3d 656 (Ninth Circuit, 1999)