Opinions of the United
2007 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


3-13-2007

Kramer v. Kubicka
Precedential or Non-Precedential: Non-Precedential

Docket No. 06-3355




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"Kramer v. Kubicka" (2007). 2007 Decisions. Paper 1490.
http://digitalcommons.law.villanova.edu/thirdcircuit_2007/1490


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                                                               NOT PRECEDENTIAL

                       UNITED STATES COURT OF APPEALS
                            FOR THE THIRD CIRCUIT

                                      NO. 06-3355
                                   ________________

                      KURT H. KRAMER; MARIA E. KRAMER,

                                           Appellants
                                           v.

                      THOMAS KUBICKA; BONNIE KUBICKA
                      ____________________________________

                     On Appeal From the United States District Court
                               For the District of New Jersey
                                (D.C. Civ. No. 05-cv-02621)
                       District Judge: Honorable William J. Martini
                     _______________________________________


                       Submitted Under Third Circuit LAR 34.1(a)
                                   January 30, 2007

           BEFORE: SLOVITER, McKEE and AMBRO, CIRCUIT JUDGES

                                 (Filed: March 13, 2007)

                                ______________________

                                      OPINION
                               _______________________

PER CURIAM

       Appellants Kurt and Maria Kramer, proceeding pro se, appeal the District Court’s

entry of summary judgment in favor of Appellees, Thomas and Bonnie Kubicka. For the

reasons that follow, we will affirm.
       Appellants are a married couple who had a longstanding personal relationship with

Appellees, also a married couple. Between 1978 and 1993, Appellees made periodic

loans to Appellants, totaling $28,700. Appellants signed a note for each of the loans,

which were made at a range of interest rates. Appellants made interest-only payments on

these notes until March 1994, at which point they stopped making payments entirely. In

February 1998, they instituted a bankruptcy action, which was dismissed in May 1999 for

failure to present a workable plan. The following month, Appellees filed an action

against Appellants in the Court of Common Pleas in Bucks County, Pennsylvania

demanding the total outstanding on the notes plus interest, for a sum of $53,187.20.

According to Appellants, after their attorney failed to file an answer, default judgment

was entered against them on September 3, 2000. On May 16, 2001, Appellants wrote a

check to Appellees for $59,500. The check was cashed on May 18, 2001. Satisfaction

was entered in Pennsylvania on July 3, 2001 and in New Jersey on August 7, 2001.

       On May 18, 2005, Appellants initiated this lawsuit in the United States District

Court for the District of New Jersey. In their complaint, Appellants allege violations of

New Jersey and Pennsylvania usury laws, the federal Truth in Lending Act (“TILA”), 15

U.S.C. § 1601 et seq., and the Racketeer Influenced and Corrupt Organizations Act

(“RICO”), 18 U.S.C. § 1961 et seq. Appellees moved to dismiss the complaint on a

number of grounds, including expiration of the statute of limitations. Appellants moved

for summary judgment. The District Court converted Appellees’ motion to dismiss to one

for summary judgment and granted it, holding that Appellants’ state law claims were

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barred by res judicata, and that their federal claims, to the extent they were not also barred

by res judicata, were time-barred. Appellants filed the instant appeal.

       We have jurisdiction over this appeal pursuant to 28 U.S.C. § 1291. We review a

district court’s grant of summary judgment de novo. Pennsylvania Coal Ass’n v. Babbitt,

, 236 (3d Cir. 1995). Summary judgment is proper only if it appears “that

there is no genuine issue as to any material fact and that the moving party is entitled to a

judgment as a matter of law.” Fed. R. Civ. P. 56(c); Carrasca v. Pomeroy, 

,

832-33 (3d Cir. 2002).

       The District Court held that both Appellants’ RICO and TILA claims were time-

barred. We agree. As the District Court noted, TILA claims are subject to a one-year

limitations period, 15 U.S.C. § 1640(e), and RICO claims to a four-year limitations

period. See Agency Holding Corp. v. Malley-Duff & Assocs., Inc., 

, 156

(1987). We have held that a RICO claim accrues when a plaintiff knew or should have

known of the injury alleged. See Prudential Ins. Co. of Am. v. U.S. Gypsum Co., 

, 233 (3d Cir. 2004). The injury Appellants complain of is the alleged collection

of an “unlawful debt” as defined by 18 U.S.C. § 1961(6). We agree with the District

Court that the last payment that could so qualify was made by Appellants in 1994, and

therefore does not satisfy the four-year limitations period.

       Appellants contest this conclusion, relying on their argument that the default

judgment is void ab initio due to Appellees’ failure to serve them personally, in addition

to serving their attorney, as required by Pa. R. Civ. P. 237.1(a)(2)(ii). See Erie Ins. Co. v.

                                              3
Bullard, 

, 387 (Pa. Super. Ct. 2003). Because they claim that the default

judgment is therefore a nullity, they maintain that their payment of $59,500 should also

be considered a predicate act. We disagree. A judgment entered by a court of competent

jurisdiction does not fall within the definition of an “unlawful debt” as defined by the

RICO statute. See 18 U.S.C. § 1961(6). As no court has declared the default judgment

null, we continue to consider it valid.

       With respect to Appellants’ state law claims, because we affirm the District

Court’s dismissal of Appellants’ federal claims, we conclude that the District Court could

have declined to exercise supplemental jurisdiction over these claims. See 28 U.S.C.

§ 1367(c)(3); see also Growth Horizons, Inc. v. Delaware County, Pennsylvania, 

, 1284-85 (3d Cir. 1993).

       Accordingly, we conclude that the District Court properly entered summary

judgment in favor of Appellees and will affirm its order.




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