Song Pae v. Recontrust Company, N.A.

• Court: Court of Appeals for the Ninth Circuit
• Decided: July 21, 2023
• Docket: 22-55373
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS JUL 21 2023 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

SONG PAE; SANG OK PAE, a man and No. 22-55373 wife; MEESON PAE YANG, an individual; 22-55375 SAMUEL S. LEE, an individual, 22-55407

Plaintiffs-Appellants, D.C. No. 2:21-cv-08898-MCS-JEM v.

RECONTRUST COMPANY, N.A., a U.S. MEMORANDUM* corporation and wholly-owned subsidiary of Bank of America Corporation; BANK OF NEW YORK MELLON CORP., commonly known as BNY Mellon, an American worldwide banking and financial service holding company; SAFEGUARD PROPERTIES MANAGEMENT, LLC, FKA Safeguard Properties, LLC, a Delaware limited liability company; STONECREST ACQUISITIONS, LLC, a California limited liability company; JOHN HOCHHAUSLER, an individual attorney; CORI B. JONES, an individual attorney; DOES, 1 through 250, inclusive; JON O. FREEMAN,

Defendants-Appellees.

Appeal from the United States District Court for the Central District of California Mark C. Scarsi, District Judge, Presiding

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. Submitted July 19, 2023** Pasadena, California

Before: NGUYEN and FORREST, Circuit Judges, and R. BENNETT,*** District Judge.

Plaintiffs Song Won, Sang Ok Pae, Meeson Pae Yang, and Samuel S. Lee

appeal from the district court’s order denying their motions for default judgment

against Defendants Bank of New York Mellon Corporation (BNYM) and

ReconTrust Company, N.A., dismissing their complaint with prejudice and without

leave to amend, and granting Defendants Safeguard Properties Management, LLC,

Stonecrest Acquisitions, LLC, and John M. Hochhausler’s motions for sanctions.

We have jurisdiction under 28 U.S.C. § 1291. We affirm the district court and

caution Plaintiffs against wasting this court’s and the parties’ resources on such

frivolous appeals. See Fed. R. App. P. 38; see also In re Westwood Plaza N., 889

F.3d 975, 977 (9th Cir. 2018).

1. Due process. Plaintiffs were afforded due process where the district

court held a hearing on the motions to dismiss and Safeguard’s motion for sanctions

and notified the Parties that it would decide the remaining motions without further

** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). *** The Honorable Richard D. Bennett, United States District Judge for the District of Maryland, sitting by designation.

2 argument. The district court also considered Plaintiffs’ untimely opposition briefs,

and Plaintiffs declined to confer regarding Stonecrest and Hochhausler’s motion for

sanctions. In short, Plaintiffs’ due process argument is belied by the record and

clearly meritless. See, e.g., Toth v. Trans World Airlines, Inc., 862 F.2d 1381, 1387

(9th Cir. 1988) (rejecting due process argument that was “clearly contradicted by the

record”); Morrow v. Topping, 437 F.2d 1155, 1156–57 (9th Cir. 1971) (per curiam)

(holding that deciding motion without argument was not a denial of due process).

2. Dismissal and denial of default judgment. The district court did not

err in dismissing Plaintiffs’ complaint and denying their motions for default

judgment where Plaintiffs’ own caselaw is clearly contrary to their assertion that

their RICO claim did not accrue until they discovered the alleged RICO pattern. See

Grimmett v. Brown, 75 F.3d 506, 510–12 (9th Cir. 1996); see also Pincay v.

Andrews, 238 F.3d 1106, 1109 n.3. (9th Cir. 2001). Plaintiffs’ equitable tolling

argument also fails where they point to no specific misconduct by Defendants

justifying Plaintiffs’ failure to timely bring their claims despite pursuing

substantially similar claims in other actions over the past decade. See Huynh v. Chase

Manhattan Bank, 465 F.3d 992, 1003–05 (9th Cir. 2006) (affirming dismissal of

time-barred claims and rejecting equitable tolling argument). And Plaintiffs do not

otherwise present a specific argument that their claims—which, other than their

RICO claim, they have already filed in their five previous lawsuits—are timely. See

3 United States ex rel. Kelly v. Serco, Inc., 846 F.3d 325, 335 (9th Cir. 2017)

(explaining that we will not consider arguments not raised specifically and distinctly

on appeal). The district court acted within its authority in sua sponte dismissing

Plaintiffs’ complaint and denying the requested default judgment. See Abagninin v.

AMVAC Chem. Corp., 545 F.3d 733, 742–43 (9th Cir. 2008) (holding that a court

may dismiss a complaint against non-appearing defendants based on facts presented

by other defendants); see also Eitel v. McCool, 782 F.2d 1470, 1471–72 (9th Cir.

1986) (explaining district court may consider the sufficiency of the complaint in

ruling on motion for default judgment).

3. Sanctions. Plaintiffs’ arguments regarding sanctions are largely

redundant of their arguments claiming the district court denied them due process and

erred in dismissing their complaint, and we reject them for the reasons already

discussed. See Toth, 862 F.2d at 1387. The district court’s conclusions regarding the

frivolousness of Plaintiffs’ arguments and their litigation conduct are supported by

the record and were proper considerations for imposing sanctions under Rule 11. See

Fed. R. Civ. P. 11; see also Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d

1092, 1102 (9th Cir. 2016) (“District courts can use Rule 11 to impose sanctions on

any party that files a [pleading, motion, or other paper] for an ‘improper purpose’ or

4 who does so without a legal or factual basis.”). Further, Plaintiffs do not

dispute the reasonableness of the fees.

AFFIRMED.