McCall v. Williams

District Court, D. Arizona·Decided November 13, 2020·No. 2:19-cv-05126·Unknown

Opinion

1 WO 2 3 4 5

9 Chimyere McCall, et al., No. CV-19-05126-PHX-SMB

Plaintiffs, 11 v. 12

13 Damon Charles Williams, et al.,

14 Defendants. 15

16 Pending before the Court is Plaintiffs/Counterdefendants’, Chimyere McCall and 17 Monroe McCall’s (“the McCalls”), Motion to Dismiss Defendants/Counterplaintiffs’ 18 Counterclaim. (Doc. 51.) Defendants/Counterplaintiffs, Damon and Zene Williams (“the 19 Williams”), responded, (Doc. 52.), and the McCalls replied. (Doc. 53.) Despite the parties’ 20 request, the Court elects to rule without oral argument. See L.R. Civ 7.2(f). 21 I. BACKGROUND 22 This action comes to the Court by way of removal under 28 U.S.C. § 1446(a). The 23 original action was filed in Maricopa County Superior Court on March 19, 2019. (Doc. 1- 24 1 at 11.) This action was filed by the McCalls seeking declaratory relief and damages from 25 the Williams. (Id. at 12.) The McCalls allege three causes of action including two claims 26 for relief under A.R.S. § 33-420 as well as a claim of racketeering based on A.R.S. § 13- 27 2314.04. The parties’ legal disputes run back more than a decade. Indeed, the claims and 28 1 counterclaims in this case cannot be understood without an explanation of the past 2 interactions and litigation involving the McCalls and the Williams. 3 United Solutions Corporation (“U.S.C.”) was a former Washington corporation that 4 did business in Arizona. (Doc. 1-1 at 13; Doc. 48 at 2-3.) From the time of its formation in 5 2006 until its dissolution in 2011, U.S.C.’s sole shareholder and officer was Damon Charles 6 Williams. (Id.) On June 25, 2009, U.S.C. obtained a judgment against the McCalls from 7 the Maricopa County Superior Court in the amount of $1,043,375.00 plus an additional 8 $2,451.81 in costs. (Doc. 1-1 at 38.) The McCalls’, shortly after the judgment was entered, 9 left Arizona and moved to Washington County Arkansas before the judgement could be 10 collected. (Id. at 14.) In 2010, U.S.C. filed an action in Arkansas state court seeking to 11 domesticate its Arizona judgement against the McCalls. (Doc. 1-1 at 14; Doc. 48 at 3.) 12 On November 4, 2010, the McCalls filed a petition for Chapter 7 bankruptcy 13 protection in the United States Bankruptcy Court for the Western District of Arkansas.1 14 See 5:10-bk-75819. Several months later, on February 7, 2011, U.S.C. filed an adversary 15 complaint in the bankruptcy proceeding seeking to have its judgement classified as a non- 16 dischargeable debt. See 5:11-ap-07015. However, prior to any hearing on whether the 17 judgement was dischargeable, U.S.C.’s counsel withdrew, citing nonpayment of fees and 18 a cessation of communications by U.S.C. as cause. (Id.) No officer of U.S.C. nor any 19 subsequent counsel for U.S.C. made any further appearance in the bankruptcy proceeding. 20 (Id.) Accordingly, on September 29, 2011, Judge Barry of the United States Bankruptcy 21 Court for the Western District of Arkansas entered an order stating “[U.S.C.’s] case is 22 dismissed with prejudice under Rule 41(b) FRCP, made applicable through Rule 7041 23 FRBP, for failure to prosecute its case…such dismissal operates as an adjudication on the 24 merits. The claim of [U.S.C.], if any, is dischargeable.” (Id.) The records of the McCalls’ 25 proceedings in bankruptcy do not reveal any additional involvement or challenges by 26 U.S.C. or the Williams. Eventually on October 17, 2011, the bankruptcy court granted a

27 1 As will be discussed below, the Court takes judicial notice of underlying state court 28 action, bankruptcy proceedings in the United States Bankruptcy Court for the Western District of Arkansas, and the related Judgment Liens recorded by Maricopa County. 1 discharge of the McCalls’ debts, including the McCalls’ judgement debt to U.S.C. (Id.) 2 More than six years later, on March 23, 2018, the Williams created a lien against all 3 of the McCalls’ Arizona real property by filing an “Affidavit for Renewal of Judgement” 4 with the Maricopa County Recorder and attaching a copy of the original 2009 judgement 5 for U.S.C. See Doc. No. 2018-0218732. The McCalls responded to the affidavit by filing 6 this action in Maricopa County Superior Court. (Doc. 1-1 at 11.) The McCalls’ complaint 7 sought to have the Williams’ lien declared invalid, sought damages for the Williams’ 8 alleged filing of a wrongful lien, and sought to enforce a private right of action against the 9 Williams for racketeering. (Id. at 15-18.) 10 The Williams removed the case to this Court where they answered the Complaint 11 and asserted several counterclaims at issue in this motion. (Doc. 1; Doc. 48.) The 12 Counterclaim contains seven claims and an affirmative defense of recoupment that stem 13 from Ms. McCall’s former employment with U.S.C., as well as one claim for “abuse of 14 process.” (Doc. 48 at 13-23.) The McCalls responded with a Motion to Dismiss under Rule 15 12(b)(6), arguing the Williams’ counterclaims were a reiteration of the U.S.C. complaint 16 against the McCalls that had resulted in the original 2009 judgement and as such were 17 barred by res judicata. (Doc. 51.) In the alternative, the McCalls argued that many of the 18 counterclaims made by the Williams pertain the events that occurred well beyond the 19 statute of limitations for bringing a claim. (Id.) Finally, the McCalls argue that while neither 20 res judicata nor the applicable statute of limitations bars the Williams’ abuse of process 21 claim, the Williams have nonetheless failed to state a claim. (Id.) The Williams have 22 responded asserting that the McCalls’ motion is untimely, that neither res judicata nor any 23 statute of limitations bars their action, and that they have adequately stated a claim for 24 abuse of process. (Doc. 52.) 26 To survive a Rule 12(b)(6) motion for failure to state a claim, a complaint must meet 27 the requirements of Rule 8(a)(2). See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007). 28 Rule 8(a)(2) requires a “short and plain statement of the claim showing that the pleader is 1 entitled to relief,” so that the defendant has “fair notice of what the . . . claim is and the 2 grounds upon which it rests.” Fed. R. Civ. P. 8(a)(2); Twombly, 550 U.S. at 555 (quoting 3 Conley v. Gibson, 355 U.S. 41, 47 (1957)). Dismissal under Rule 12(b)(6) “can be based 4 on the lack of a cognizable legal theory or the absence of sufficient facts alleged under a 5 cognizable legal theory.” Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 6 1988). A complaint that sets forth a cognizable legal theory will survive a motion to 7 dismiss if it contains sufficient factual matter, which, if accepted as true, states a claim to 8 relief that is “plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting 9 Twombly, 550 U.S. at 570). Facial plausibility exists if the pleader sets forth “factual 10 content that allows the court to draw the reasonable inference that the defendant is liable 11 for the misconduct alleged.” Id.

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