MARCIA S. KRIEGER, District Judge.
The operative facts for purposes of the instant motion are undisputed. The Plaintiff is the named representative of a class that holds a judgment
In January 1997, the Plaintiff registered the Hawaii judgment in Illinois, pursuant to 28 U.S.C. § 1963, but commenced no efforts to enforce it there. On or about February 3, 2005, the Hawaii judgment expired by operation of Hawaii law. Hi. Rev.Stat. § 657-5.
In April 2005, the Plaintiff registered the Hawaii judgment in Colorado and Texas and commenced suits similar to this one, seeking to execute the judgment against certain real property in those jurisdictions. In or about June 2006, when the defendant in the Texas action raised an argument that the Hawaii judgment had expired, the Plaintiff returned to the District of Hawaii, requesting that the judgment be extended. The District Court extended the judgment for another ten years under the Hawaii statute, but on appeal, the 9th Circuit reversed that ruling, finding that Hawaii law deemed the judgment "extinguished" on or about February 3, 2005 and that any request to extend it had to be brought prior to that date. In re Estate of Ferdinand E. Marcos Human Rights Litigation, 536 F.3d 980, 990 (9th Cir.2008). As a result of that
Having no enforceable Hawaii judgment, the Plaintiff then turned to the registered judgment in Illinois. By operation of Illinois law, a judgment registered becomes dormant seven years after registration and must be "revived" by the judgment creditor. 735 Il. Comp. Stat. 5/12-108(a). However, once revived, a judgment in Illinois remains effective for a period of 20 years from the date entry of that judgment. 735 Il. Comp. Stat. 5/2-1602(a). The Plaintiff petitioned the United States District Court for the Northern District of Illinois to revive that judgment, and on September 4, 2008, the court granted that request, directing the Clerk of the Court to "enter this revived judgment pursuant to FRCP 58."
The crux of the issue before this Court concerns the effect of the registration of the Hawaii judgment in Illinois and the revival of that judgment by the District Court. The Plaintiff contends that the registration of the Hawaii judgment in Illinois created a wholly new judgment that was enforceable and revivable under Illinois law. Viewed in that light, the Plaintiff contends that the Illinois judgment is not derivative in nature, but an independent judgment that can be registered in other jurisdictions despite the expiration of the Hawaii judgment (and, by extension, its registration in each new jurisdiction creates a new, separately-enforceable judgment). Denman contends that the timely registration of the Hawaii judgment in Illinois allows the Plaintiff to enforce that judgment in Illinois, but does not create (or allow the creation of) a new Illinois judgment that can be "re-registered" and enforced in other jurisdictions.
This precise issue was considered in proceedings involving the Plaintiff before the United States District Court for the Northern District of Texas. In Del Prado v. B.N. Development Co., 602 F.3d 660 (N.D.Tex.2009), the court granted the defendant's motion to dismiss the Plaintiff's suit, rejecting the Plaintiff's argument that 28 U.S.C. § 1963 operates to create a new, independent judgment upon the registration of a foreign judgment. On appeal, the 5th Circuit disagreed, finding that registration of a judgment under § 1963 created a new judgment that "had all of the attributes of a judgment rendered by the [jurisdiction of registration]," that, in turn "may be re-registered" in other jurisdictions. Del Prado v. B.N. Development Co., 602 F.3d 660, 667 (5th Cir.2010).
In reviewing a motion to dismiss pursuant to Rule 12(b)(6), the Court must accept all well-plead allegations in the Complaint as true and view those allegations in the light most favorable to the nonmoving party. Stidham v. Peace Officer Standards and Training, 265 F.3d 1144, 1149 (10th Cir.2001), quoting Sutton v. Utah State Sch. For the Deaf & Blind, 173 F.3d 1226, 1236 (10th Cir.1999). The Complaint should not be dismissed for failure to state a claim "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957); Benefield v. McDowall, 241 F.3d 1267, 1270 (10th Cir.2001); GFF Corp. v. Associated Wholesale Grocers, Inc., 130 F.3d 1381, 1384 (10th Cir.1997). The Court must limit its review to the four corners of the Complaint, but may also consider documents attached to the Complaint as exhibits, Oxendine v. Kaplan, 241 F.3d 1272, 1275 (10th Cir.2001), as well as unattached documents which are referred to in the Complaint and central to the plaintiff's claim, so long as the authenticity of such
Here, the Plaintiff objects to Denman's submission of certain extraneous material in support of its motion. As the following discussion reveals, the only extraneous material the Court has considered with regard to this matter are the contents of filings by the Plaintiff in the Northern District of Illinois. Whether the Court takes note of these pleadings as a result of judicial notice, see Continental Coal, Inc. v. Cunningham, 511 F.Supp.2d 1065, 1071 (D.Kan.2007) (court may take judicial notice of pleadings filed in other cases on Rule 12 motion), or whether the Court reasons that the pleadings themselves are merged into the Illinois judgment, which in turn is attached to the Complaint in this action as proof of the Plaintiff's assertion that that judgment has been registered in this Court, is immaterial; in either instance, the Court finds it appropriate to consider those documents on a Rule 12 motion.
Much of Denman's original motion— filed after the Northern District of Texas' ruling in Del Prado but before the ruling of the 5th Circuit—concerns questions of collateral estoppel and is no longer viable. The only question requiring consideration in this case is the same one faced by the Northern District of Texas and the 5th Circuit: does registration of a judgment pursuant to 28 U.S.C. § 1963 create a wholly new judgment that can, in turn, be re-registered to create wholly new judgments in other jurisdictions?
This issue appears to be one of first impression in the 10th Circuit. Consequently, the Court has carefully considered the reasoning of Northern District of Texas, the 5th Circuit, and the various authorities cited by the parties. For the reasons that follow, this Court respectfully respectfully disagrees with the 5th Circuit's reasoning. This Court concludes that only an original judgment, issued by a court upon the substantive merits of an adversarial dispute, can be registered pursuant to 28 U.S.C. § 1963, and it cannot be registered once it is extinguished under the law of the jurisdiction where it was entered. A judgment created by registration (a "registered judgment") is enforceable in jurisdiction where it is registered in accordance with the law of that jurisdiction, but it cannot be subsequently "re-registered" in other jurisdictions. In this case, the rule that this Court finds proper would allow the Plaintiff to enforce his registered judgment in Illinois, but because the original Hawaii judgment has been extinguished before it was registered elsewhere, the Plaintiff cannot register or enforce any judgment outside of Illinois.
The Court begins with the fundamental legal axiom that a judgment is "the final determination of an action," that embodies a court's adjudication of "a claim pressed and resisted (or the opportunity for resistance) by adversaries". 10 Wright, Miller & Kane, Federal Practice and Procedure, Civil 3d Ed., § 2651, quoting In the Matter of Fidelity Tube, 167 F.Supp. 402, 404 (D.N.J.1958); see also Am. Jur. (2d Ed.) Judgments, § 1 ("It is the final decision of the court, resolving the dispute and determining the rights and obligations of the parties, and the law's last word in a judicial controversy"). Enforcement of a judgment entered by a federal court is constrained both by federal law and by the law of the jurisdiction where it is entered. Fed.R.Civ.P. 69(a)(1).
When a judgment creditor desires to enforce a federal court judgment in a jurisdiction other than the one where it is
Id.
The major point of contention between the parties is the meaning of the last quoted sentence, which provides that a registered judgment shall have "the same effect" and "may be enforced in like manner" as a judgment that originated in that jurisdiction. Before delving into their arguments as to the meaning of the second sentence, the Court pauses to observe the importance of reading the final sentence in conjunction with the first sentence of the statute—that which specifies what judgment can be registered. It authorizes registration of a "judgment in an action for the recovery of money or property entered in any court of appeals, district court, bankruptcy court, or in the Court of International Trade. . . ." This language anticipates two requirements—that a judgment has been entered by a court (as compared to a "judgment" that comes into effect by being registered), and that it be entered in an action for the recovery or money or property (in essence, reflecting the adjudication of a claim for tangible, not simply declaratory, relief). This language is consistent with the fundamental nature of a judgment—a document reflecting the determination of a claim on its merits. It is not, however, consistent with a registered judgment, which is simply the perfection of an existing judgment in another jurisdiction so as to permit foreign enforcement. Interpreted in this way, the statute would appear to provide that only an original judgment resolving an adversarial proceeding for tangible relief can be registered in another jurisdiction.
Once registered, the question is what attributes the registered judgment has. The seminal case grappling with this issue is Stanford v. Utley, 341 F.2d 265 (8th Cir.1965).
341 F.2d at 266.
The court noted that legislative history provided no guidance as to how Congress intended the last sentence of § 1963 to apply in such circumstances. Id. at 268. Observing that § 1963 is "more than `ministerial'" and more than "a mere procedural device for the collection of the foreign judgment," the court stated that "We feel that registration provides, so far as enforcement is concerned, the equivalent
Stanford took pains to ensure that its holding would be limited to the specific facts of the case. The court observed the potential for "problems attendant upon [the] broader aspect of the statute," but noted that these issues "are not now before us[; w]e are concerned here only with the registration's having the same effect as a money judgment for the purpose of enforcement in the registration court." Id. at 270 (emphasis added). In addition, the court noted that "§ 1963 presents much to be answered in the future," and reeled off a string of hypothetical questions, including "[i]s a registered judgment itself subject to registration elsewhere?" Id. at 271. "The presence of these and undoubtedly many other questions," the court cautioned, "prompts us to emphasize that the conclusion we reach here is one having application to the fact situation of this case. We do not now go so far as to say that registration effects a new judgment in the registration court for every conceivable purpose; nor do we say that it fails to do so for any particular purpose." Id.
Such careful limitation in the holding of Stanford was not recognized in the 5th Circuit's recent decision in Del Prado. It cited Stanford and other cases (which will be discussed shortly), for a broader proposition that "a registered judgment is equivalent to a new federal judgment." 602 F.3d at 666, citing Stanford, 341 F.2d at 269-70. It appears that the 5th Circuit overlooked the reasoning of Stanford, particularly that limitation of its holding to the fact that a registered judgment resembled an independent federal judgment for purposes of enforceability in the jurisdiction where it had been registered. In this oversight, Del Prado fails to give deference to Stanford's rationale—that the enforcement of domestic and registered judgments should be the same. (More seriously, as explained later, this oversight invites the parade of horribles that Stanford assiduously sought to avoid.)
The Del Prado court's misreading of Stanford is particularly odd in light of that same court's clear appreciation of Stanford's limitations in another 5th Circuit case, Home Port Rentals, supra., that factored heavily into Del Prado's analysis. In Home Port Rentals, the 5th Circuit faced a situation similar to Stanford; the plaintiff had obtained a judgment in South Carolina in 1989, and, on the eve of that judgment's expiration under South Carolina law, registered it in Louisiana pursuant to 28 U.S.C. § 1963. Thereafter the creditor sought to execute against the debtor's property in Louisiana. Throughout Home Port Rentals' discussion (which
Although it relies on Home Port Rentals, Del Prado overlooks the 5th Circuit's own prior reasoning; it fails to acknowledge that prior precedent equates registered and domestic judgments only for purposes of enforcement in the state of registration. As a result, Del Prado mistakenly cites Home Port Rentals for the unqualified proposition that "a registered judgment has the same effect as a rendered judgment." 602 F.3d at 666.
But this oversight is compounded in Del Prado's misunderstanding of Home Port Rentals. The court quotes, then ignores, then ultimately dismisses the limitation language of Home Port Rentals as "dicta." Id. at n. 8 (acknowledging defendants' argument that Home Port Rentals "limits the effect of registered judgments" to "enforcement within the district of registration" but finds that the Home Port Rentals court "was not concerned with successive registration" and thus, "we do not read the dicta of Home Port Rentals as a signal that a registered judgment could not be successively registered"). In actuality, the qualifying language of Home Port Rentals is the exact opposite of dicta. It is not a gratuitous observation by the court that is not essential to the decision; it is the court's own attempt to ensure that future readers do not extend the stated reasoning beyond the precise factual circumstances presented—the very error that Del Prado commits.
Cases such as Stanford and Home Port Rentals make clear that, although one might equate a registered judgment with a domestic judgment for purposes of enforcement in the state of registration, there is no particular reason to conclude that a registered judgment has all of the collateral features of a domestic judgment, such the ability to be (re-)registered in yet another jurisdiction. None of the cases cited in Del Prado stand for that particular proposition
The final sentence of § 1963 provides that a registered judgment "shall have the same effect as a judgment of the district court of the district where registered and may be enforced in like manner." Cases such as Stanford and Home Port Rentals place a reasonable gloss on this language, explaining that the registered judgment should be treated as if it were a domestically-issued judgment, but only for purposes of execution in the registration state; in this sense, the registered judgment has "the same effect" as the domestic judgment and is "enforced in like manner." But, as those cases also wisely note, the statutory language does not compel the conclusion that a registered judgment is the equivalent of a domestic judgment for all purposes. Such proposition is facially inconsistent with the first sentence of § 1963 that limits the types of judgments that can be registered. To the extent that Congress intended to make registered judgments identical to original judgments in all instances, it could have so provided, either by providing no restriction on the type of judgment that could be registered in the first sentence of § 1963 or by providing in the last sentence that a registered judgment shall become a judgment of the district court where registered.
There are many reasons why it is logical to differentiate registered judgments and domestic judgments for purposes of determining which can, in turn, be registered elsewhere. First, and perhaps most obviously, a rule equating registered and domestic judgments for all purposes allows judgment creditors to avoid any application of statutes of limitation and repose applying to judgments. Each state has promulgated laws deeming judgments of those states to expire after a given period of time, but serial registration of judgments makes a mockery out of those laws and the public policies underlying them. Here, the Plaintiff could have waited until the final day of the Hawaii statute of repose for judgments, and then registered the judgment in Illinois. By operations of cases such as Stanford and Home Port Rentals, that Illinois registration negates the Hawaii statute of repose on the judgment, and instead re-starts whatever period of repose Illinois has established. On the final day of that period, the Plaintiff could take the (registered) Illinois judgment to, say, Tennessee, and re-register it, thus obtaining a new statute of repose under Tennessee law. The practical effect is that no judgment could ever expire, and that creditors could simply criss-cross the nation, registering and re-registering their judgments in perpetuity. (Arguably, the circle could continue all the way back to Hawaii, creating the situation where the original judgment has expired under Hawaii law, but, because the Plaintiff took the judgment on a brief vacation to another state, the otherwise moribund original judgment can still be registered and enforced in Hawaii.)
Similarly, the Plaintiff's interpretation would create the possibility of a cascading fountain of registered judgments—the domestic Hawaii judgment becomes an Illinois judgment upon registration in Illinois, which, in turn, becomes Colorado and Texas judgments when re-registered in those states; the Colorado judgment becomes a judgment of Idaho and Utah upon registration
Conversely, under a scheme in which only the original judgment can be registered, every registered judgment relates back to a single source by a single transaction. A party or court having concerns about the validity of a registered judgment
There remains one final issue urged by the Plaintiff that requires some consideration. As the courts in Stanford and Home Port Rentals explain, the law has long recognized the notion of a "judgment on a judgment." Prior to § 1963, it was common for judgment creditors to commence suits in foreign jurisdictions, in order to obtain a "judgment on a judgment," which would then become a domestic judgment capable of being enforced in that jurisdiction. The Plaintiff argues that his Illinois judgment is just such a "judgment on a judgment," and points to the September 4, 2008 order of the Northern District of Illinois directing "entry" of judgment in favor of the Plaintiff pursuant to Fed.R.Civ.P. 58 as proof. This Court does not disagree with the general proposition that, theoretically, the Plaintiff could have gone to Illinois and commenced a civil action against Mr. Marcos' estate (assuming
However, the record here does not reflect that the proceedings in Illinois were pursued in this manner. The record indicates that, on August 27, 2008, the Plaintiff simply filed a "Petition for Revival of Judgment" in Illinois. That document does not include a Summons, Certificate of Service, or any other indication that the Plaintiff gave notice to Mr. Marcos' estate of the request. The Northern District of Illinois granted the request on September 4, 2008, only eight days later, and included with its order is a direction "pursuant to FRCP 4(f)(3) that counsel for the plaintiffs shall serve the legal representatives of [Mr. Marcos' estate] with this Order." These circumstances indicate that Mr. Marcos' estate was not given advance notice of the Illinois proceeding, nor given the opportunity to be heard before the court revived the judgment. The lack of such notice and an opportunity to be heard prevents the Court from finding that the "revival" of the Illinois judgment is somehow equivalent to the Illinois court having duly adjudicated an adversarial proceeding and issued a "judgment on a judgment."
Because the Court finds that no valid judgment is properly registered in Colorado, the Plaintiff cannot establish the key factual predicate of his claims. Accordingly, Denman's Motion to Dismiss (
The Plaintiff here mistakenly asserts that Roche stands for the proposition that the "Supreme Court has approved the successive transfer of a judgment." (Emphasis added.) Roche simply recognizes that a party willing to bring a series of successive adversarial suits seeking a "judgment on a judgment" may do so, not that a party can accomplish the same result by successively registering judgments from one jurisdiction to the next.
At best, then, the Northern District of Illinois, in response to the Plaintiff's petition to revive the judgment, could only have ordered that the 1997 registered judgment was deemed "revived"; it had not jurisdiction to direct the "entry" of a new judgment against the Marcos estate under Rule 58. Although courts can collaterally void judgments that appear to have been entered without sufficient subject-matter jurisdiction, Baella-Silva v. Hulsey, 454 F.3d 5, 9 (1st Cir.2006), this Court will not purport to void the Illinois "judgment," as Denman has not specifically asked for such relief and the record is not sufficiently complete to render such a determination. However, this Court's concerns as to the facial validity of the Illinois "judgment" effectively preclude the Court's willingness to rely on the Full Faith & Credit Clause of the Constitution or 28 U.S.C. § 1738 (statutorily implementing the clause) to give effect to that "judgment."
