JOSEPH F. BIANCO, District Judge.
Plaintiffs Philip Barash ("P. Barash") as Executor of the New York Estate of Celia Kates, and Sandra Barash ("S. Barash") as Beneficiary of the Irving G. Kates New York Trust, proceeding pro se, brought the above-captioned action against the defendants Pressley & Pressley, P.A. and James G. Pressley, Jr. ("Pressley") (collectively the "defendants"), alleging a violation of New York Judiciary Law § 487 and seeking treble damages for actions that took place in the Florida Probate Court.
By letter dated August 15, 2011, defendants moved for a sua sponte order dismissing plaintiffs complaint in its entirety pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). Defendants also seek an injunction prohibiting plaintiff from filing any further actions in any federal district court arising out of the management and administration of the Irving G. Kates Trust, and for attorneys' fees and expenses.
As discussed in more detail infra, this is P. Barash's fourth attempt in this Court to litigate claims arising from the management and administration of the Irving G. Kates Trust. See Barash v. Northern Trust Corp., et al., 07-CV-5208 (JFB)(ARL); Trustee Northern Trust Bank of Florida, N.A. v. Estate of Celia Kates, by its Executor Philip Barash and Sandra Barash, et al., 04-CV-5295 (DRH); Executor, Estate of Celia Kates, Philip Barash v. Northern Trust Bank, N.A., 04-CV-5153 (DRH)(ARL). Two of the previous cases were dismissed for lack of subject matter jurisdiction pursuant to the probate exception to federal diversity jurisdiction. See Mem. of Decision and Order, Executor, Estate of Celia Kates, Philip Barash v. Northern Trust Bank, N.A., No. 04-CV-5153 (DRH) (E.D.N.Y. Nov. 17, 2005), ECF. No. 47; Barash v. Northern Trust Corp., 07-CV-5208 (JFB)(ARL), 2009 WL 605182, (E.D.N.Y. Mar. 6, 2009). Judgment was entered on May 7, 2009 in the 2007 case, and plaintiff has not appealed that decision. The third case, 04-CV-5295 (DRH), was removed by P. Barash and S. Barash to this Court from the Probate Division of the Palm Beach County, Florida Circuit Court. Judge Hurley remanded that case to the Florida court because, inter alia, the federal court lacks subject matter jurisdiction pursuant to the probate exception. See Order, dated March 29, 2005, Trustee Northern Trust Bank of Florida, N.A. v. Estate of Celia Kates, by its Executor Philip Barash and Sandra Barash, et al., 04-CV-5295 (DRH), (E.D.N.Y Mar. 29, 2005), ECF. No. 22.
In an abundance of caution, the Court issued an Order, dated October 6, 2011, which, inter alia, required plaintiffs to show cause as to why the Court has subject matter jurisdiction to adjudicate their claims and why the claims are not barred by res judicata. Following that Order, the parties fully briefed these and other issues, and all submissions have been considered by the Court.
For the reasons set forth herein, the motion to dismiss is granted in its entirety. In particular, the Court lacks subject matter jurisdiction over this case under (1) the probate exception to diversity jurisdiction, and (2) the Rooker-Feldman doctrine. In any event, the claims must be dismissed under the doctrines of res judicata and collateral estoppel. Moreover, the claim under Section 487 of the Judiciary Law is barred by the statute of limitations, and is also not a plausible claim in this case.
Although defendants raised the issue of sanctions (including a litigation injunction) in their August 15, 2011 letter, the Court must give plaintiffs a full opportunity to be heard before imposing any sanctions. The Court did not seek a response from plaintiffs on that issue in the October 6, 2011 Order. Therefore, an Order to Show Cause will issue to plaintiffs, affording them an opportunity to be heard as to why the requested sanctions (including a litigation injunction) should not be granted.
P. Barash is the executor of the Estate of Celia Kates, which was a beneficiary of the Irving G. Kates Trust (the "Trust"). (Complaint at ¶¶ 1-2.) The Trust was created under a will executed by Irving G. Kates, the father of S. Barash, in December 1982. (Id. at ¶ 2.) Celia Kates was a lifetime beneficiary of the Trust and S. Barash was a beneficiary of the Trust. (Id. ¶ 10.) Celia Kates was S. Barash's mother. (Id.) Pursuant to a settlement agreement dated September 26, 2001, "Northern Trust, 440 Royal Palm Way, Suite 102, Palm Beach, FL 33480 became the sole Trustee of the Trust." Barash v. Northern Trust Corp., 07-CV-5208 (JFB)(ARL), 2009 WL 605182, at *1 (E.D.N.Y. Mar. 6, 2009) (citing Executor, Estate of Celia Kates, Philip Barash v. Northern Trust Bank, N.A., 04-cv-5153 (DRH)); see also Complaint at ¶ 13. Pressley conducted Pressley & Pressley, P.A.'s representation of Northern Trust Bank of Florida, N.A., as trustee of the Irving G. Kates Trust, with respect to various trust-related issues raised by plaintiff, S. Barash, which were litigated in the Florida Probate Court. (Defs.' First Letter Motion to Dismiss, Ex. G, Affirmation of Pressley dated July 26, 2010, ¶ 12.)
When Celia Kates died, the Trust terminated and Northern Trust Bank of Florida, N.A., brought an action for a judicial accounting in the Probate Division of the Fifteenth Judicial Circuit in Palm Beach County, Florida. Barash v. Northern Trust Corp., 2009 WL 605182, at *1. The Estate of Celia Kates then filed a notice of removal in the Eastern District of New York and filed to stay the proceeding in Florida. Id. at *2 (citing Northern Trust Bank of Florida, N.A. v. Estate of Celia Kates, 04-cv-5295 (DRH)).
On December 20, 2005, Judge Hurley denied the Estate's motion to stay the probate court proceeding. Id. at *2. On March 29, 2005, Judge Hurley remanded the action to the probate court, finding that removal was untimely and that the matter could not be removed to a federal court in New York pursuant to 28 U.S.C. § 1441(a). Id. The order also required P. Barash and S. Barash to pay fees to Gloria Kates and Northern Trust Bank of Florida N.A. Id.
Trial in the judicial accounting proceeding in Florida began on January 27, 2005, and plaintiff did not file a pretrial stipulation, nor did he attend or participate in the trial. Id. A final judgment in that action was issued on January 27, 2005 by Judge Martin in Florida. Id. That judgment included a ruling denying plaintiffs motion to dismiss on grounds of venue and jurisdiction. The judgment stated that:
Id. Plaintiff appealed this ruling to the District Court of Appeal of the State of Florida, Fourth District, and the judgment was affirmed on December 6, 2006. Id.
According to the plaintiffs,
(Complaint at ¶ 5.) In addition, the defendants allegedly failed to notify the plaintiffs of the trial date in a prior case. (Id.) More specifically, plaintiffs allege that defendants, inter alia, improperly brought a counterclaim against the plaintiffs on behalf of their client, Northern Trust Bank of Florida, N.A., in Florida State Court. (Id. at ¶ 14.)
On November 30, 2004, while the judicial accounting was pending in Florida, P. Barash, as executor of the Estate of Celia Kates, brought an action in the Eastern District of New York against the Northern Trust Corporation and Gwen Boykin. See Barash v. Northern Trust Corp., 2009 WL 605182, at *2 (citing Executor, Estate of Celia Kates, Philip Barash v. Northern Trust Bank, N.A., 04-cv-5153 (DRH)). The complaint in this action alleged that:
Id. (citing Memorandum of Decision and Order, dated November 17, 2005 in Executor, Estate of Celia Kates, Philip Barash v. Northern Trust Bank, N.A., 04-cv-5153 (DRH)). Judge Hurley found that the court lacked subject matter jurisdiction over plaintiff's complaint because the alleged claims fell within the probate exception to federal diversity jurisdiction, as:
Id. at *3. Judge Hurley also found the action barred under the doctrines of res judicata and collateral estoppel. Id.
Plaintiffs appealed Judge Hurley's Ruling to the United States Court of Appeals for the Second Circuit, which affirmed the ruling on November 8, 2006. Id. The Court of Appeals held that "[t]he District Court properly dismissed appellants' claims because those claims were raised, or could have been raised in an earlier proceeding in the Circuit Court of Florida." Id.
On May 15, 2007, plaintiffs filed a motion to file new evidence for review by en banc panel of the Court of Appeals for the Second Circuit. Id. On June 19, 2007, the Court of Appeals for the Second Circuit denied plaintiffs' petition for panel rehearing and petition for rehearing en banc. Id. Plaintiffs then petitioned the United States Supreme Court for a writ of certiorari, which was also denied. See Executor, Estate of Celia Kates, Philip Barash v. Osborne, 128 S.Ct. 316 (2007).
Plaintiffs also brought an action against Northern Trust Corporation in the Supreme Court of the State of New York, Nassau County, before Justice Feinman. Barash v. Northern Trust Corp., 2009 WL 605182, at *3. This action was dismissed on September 15, 2006 "based on the doctrine of res judicata." Id. The order stated that:
Id.
Plaintiffs then brought another action in the Supreme Court of the State of New York, Nassau County, before Justice Palmieri. Beneficiary, Irving G. Kates New York Trust v. Northern Trust Corp, Index No. 001713/07 (Sup. Ct. Nass. Cty. Apr. 20, 2007); Defs.' First Letter Motion to Dismiss, Ex. B. On April 20, 2007, Justice Palmieri issued an order finding that "as this proceeding is based on the same transactions and involves the same parties participating in the prior legal proceedings, which proceedings have concluded and were resolved against them, petitioners' present special proceeding must be dismissed pursuant to CPLR 3211(a)(5) (res judicata), the same basis stated by Judge Feinman." (Id.) The order also imposed an injunction against any "further actions or proceedings ... against the respondent, its officers, employees or agents without the express written permission of this Court." (Id.) The court explicitly warned plaintiff that "the Court will not hesitate to impose such sanctions should future developments warrant." (Id.)
On June 26, 2007, P. Barash on behalf of the plaintiffs, requested permission to commence another legal action against Northern Trust Corp. as required by the injunction. Beneficiary, Irving G. Kates New York Trust v. Northern Trust Corp., Index No. 001713/07 (Sup. Ct. Nass. Cty. July 9, 2007); Defs.' First Letter Motion to Dismiss, Ex. C. Justice Palmeieri of the Nassau County Supreme Court denied the request and stated that "Petitioners have raised no new basis for suit that would not be barred under the doctrine of res judicata, as stated in this Court's prior determination." Id. In addition, to the extent that plaintiffs' requested reargument of the court's previous determination, the request was denied. Id.
On June 28, 2007, plaintiffs filed a motion to compel examination of Gwen Boykin with Justice Palmieri. Beneficiary, Irving G. Kates New York Trust v. Northern Trust Corp., Index No. 001713/07 (Sup. Ct. Nass. Cty. July 18, 2007); Def.'s First Letter Motion to Dismiss, Ex. C. This motion was denied with a statement that the court's April 20, 2007 decision "directed [Barash] to obtain leave of the Court to submit this motion but [he] failed to do so. [Barash is] reminded that future violations of this mandate will not be tolerated." Id. Moreover, the Court noted that, since the petition was previously denied, there was no proceeding in which to conduct discovery. Id. Justice Palmieri also held that, to the extent the plaintiffs were seeking reargument of the court's prior decisions, that request was denied because "the Court does not believe it overlooked or misapprehended any facts or law." Id.
On July 17, 2007, plaintiffs made another motion to renew and reargue the August 20, 2007 order. Beneficiary, Irving G. Kates New York Trust v. Northern Trust Corp., Index No. 001713/07 (Sup. Ct. Nass. Cty. Aug. 1, 2007); Def.'s First Motion to Dismiss, Ex. C. Justice Palmieri denied the request. Id. The court noted that "[r]eargument is not a vehicle for a party to argue again the very questions previously decided, or to raise arguments that could have been raised earlier, but were not." Id.
On August 19, 2008, the Appellate Division, Second Department issued a decision affirming Justice Palmieri's April 20, 2007 Order on res judicata grounds. Beneficiary, Irving G. Kates New York Trust v. Northern Trust Corp., Index No. 2007-03921 (N.Y. App. Div Aug. 19, 2008); Def.'s First Letter Motion to Dismiss, Ex. D. The Second Department also affirmed Justice Palmieri's order enjoining P. Barash from commencing further litigation against Northern Trust Corporation without written permission of the court. Id. The Second Department also affirmed the September 15, 2006 order on August 19, 2008, in a separate decision on res judicata grounds. Philip Barash v. Northern Trust Corporation, 2009 WL 605182, at *4.
Plaintiff then brought another action in the Eastern District of New York captioned Philip Barash v. Northern Trust Corp. under docket number 07-CV-5208 (JFB)(ARL) alleging that Northern Trust committed fraud and mismanaged the Trust.
Plaintiffs then filed an action against Pressley P.A. and G. Pressley in the Supreme Court of the State of New York, County of Nassau for violation of New York Judiciary law § 487. Executor of the New York Estate of Celia Kates v. Pressley, Index No. 9928-10 (Sup. Ct. Nass. Cty. Aug 23, 2010); Def.'s First Letter Motion to Dismiss, Ex F. In that action, Justice Diamond denied plaintiffs' motion for default judgment and held that "any future violations of this injunction, previously imposed by a decision and order of this Court issued by Judge Palmieri on April 20, 2007, WILL, without issue or debate, result in sanctions against plaintiffs." (Id.) (emphasis in the original).
Plaintiffs filed the summons and complaint in this action on July 6, 2011. On August 15, 2011, defendants filed a letter application requesting that plaintiffs' complaint be dismissed sua sponte or, in the alternative, that the Court require defendants to submit a formal motion to dismiss. (Defs.' First Letter Motion to Dismiss.) The letter also requested that this Court sanction the plaintiffs for interposing a frivolous action. On August 20, 2011, plaintiffs served a "Briefing Document for Pre-Motion Conference" and sought a premotion conference to invoke Federal Rule of Civil Procedure 60(d) to set aside the judgment in the action Philip Barash v. Northern Trust Corporation, Index No. 07-CV-0508(JFB)(ARL).
On October 6, 2011, this Court issued an Order, inter alia, explaining that a non-attorney executor of an estate may not proceed pro se in litigating an interest specific to the estate or where the estate has beneficiaries other than the representative. See Guest v. Hansen, 603 F.3d 15, 20 (2d Cir. 2010) ("We have previously held that `an administr[ator] or execut[or] of an estate may not proceed pro se when the estate has beneficiaries or creditors other than the litigant.'" (quoting Pridgen v. Andresen, 113 F.3d 391, 393 (2d Cir. 1997))); see also Iannaccone v. Law, 142 F.3d 553, 559 (2d Cir. 1998). Thus, the Order noted that, given that the complaint in this case was being brought pro se by a non-attorney executor, P. Barash, on behalf of Trust beneficiary S. Barash, the plaintiffs could not proceed pro se. The Order also directed that, once counsel was retained, plaintiffs had to make a written submission explaining how the Court had subject matter jurisdiction to adjudicate their claims in light of the probate exception to diversity jurisdiction, and also to address why the case should not be dismissed on res judicata grounds.
On October 17, 2011, in response to the Court's Order, P. Barash served an amended signature page to the complaint that was signed by both himself and S. Barash. The purpose of this submission was to make clear that P. Barash was not representing the Trust beneficiary, but rather that she was also representing herself. Moreover, on October 20, 2011, plaintiffs submitted a Reply to the Order of the Court. On October 27, 2011, defendants requested for a second time that the Complaint be dismissed in its entirety but, in the alternative, if the Court was to entertain the plaintiff's reply, to allow defendants time to formally respond.
On November 2, 2011, this Court issued an Order accepting the amended signature page, allowing the defendants to reply to plaintiffs' submission on or before December 2, 2011, and allowing plaintiffs to submit a reply on or before December 16, 2011.
When a court reviews a motion to dismiss for lack of subject-matter jurisdiction, it "must accept as true all material factual allegations in the complaint, but [it is] not to draw inferences from the complaint favorable to plaintiffs." J.S. ex rel. N.S. v. Attica Cent. Schs., 386 F.3d 107, 110 (2d Cir. 2004). Moreover, the court "may consider affidavits and other materials beyond the pleadings to resolve the jurisdictional issue, but [it] may not rely on conclusory or hearsay statements contained in the affidavits." Id. "The plaintiff bears the burden of proving subject matter jurisdiction by a preponderance of the evidence." Aurecchione v. Schoolman Transp. Sys., Inc., 426 F.3d 635, 638 (2d Cir. 2005).
When a Court reviews a motion to dismiss for failure to state a claim for which relief can be granted, it must accept the factual allegations set forth in the complaint as true and draw all reasonable inferences in favor of the plaintiff. See Cleveland v. Caplaw Enters., 448 F.3d 518, 521 (2d Cir. 2006); Nechis v. Oxford Health Plans, Inc., 421 F.3d 96, 100 (2d Cir. 2005). "In order to survive a motion to dismiss under Rule 12(b)(6), a complaint must allege a plausible set of facts sufficient `to raise a right to relief above the speculative level.'" Operating Local 649 Annuity Trust Fund v. Smith Barney Fund Mgmt. LLC, 595 F.3d 86, 91 (2d Cir. 2010) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). This standard does not require "heightened fact pleading of specifics, but only enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570.
The Supreme Court clarified the appropriate pleading standard in Ashcroft v. Iqbal, setting forth a two-pronged approach for courts deciding a motion to dismiss. 556 U.S. 662, 129 S.Ct. 1937 (2009). The Court instructed district courts to first "identify[ ] pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth." Id. at 1950. Although "legal conclusions can provide the framework of a complaint, they must be supported by factual allegations." Id. Second, if a complaint contains "wellpleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Id. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. The plausibility standard is not akin to a `probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. at 1949 (internal citations omitted) (quoting and citing Twombly, 550 U.S. at 556-57).
Where, as here, the plaintiff is proceeding pro se, "[c]ourts are obliged to construe the [plaintiff's] pleadings ... liberally." McCluskey v. N.Y. State Unified Court Sys., No. 10-CV-2144 (JFB)(ETB), 2010 U.S. Dist. LEXIS 69835, 2010 WL 2558624, at *8 (E.D.N.Y. June 17, 2010) (citing Sealed Plaintiff v. Sealed Defendant, 537 F.3d 185, 191 (2d Cir. 2008) and McEachin v. McGuinnis, 357 F.3d 197, 200 (2d Cir. 2004)). Nonetheless, even though the Court construes a pro se complaint liberally, the complaint must still "state a claim to relief that is plausible on its face" to survive a motion to dismiss. Mancuso v. Hynes, 379 F. App'x 60, 61 (2d Cir. 2010) (quoting Iqbal, 129 S. Ct. at 1949); see also Harris v. Mills, 572 F.3d 66, 72 (2d Cir. 2009) (applying Twombly and Iqbal to pro se complaint).
The Court notes that in adjudicating this motion, it is entitled to consider: "(1) facts alleged in the complaint and documents attached to it or incorporated in it by reference, (2) documents `integral' to the complaint and relied upon in it, even if not attached or incorporated by reference, (3) documents or information contained in defendant's motion papers if plaintiff has knowledge or possession of the material and relied on it in framing the complaint, (4) public disclosure documents required by law to be, and that have been, filed with the Securities and Exchange Commission, and (5) facts of which judicial notice may properly be taken under Rule 201 of the Federal Rules of Evidence." In re Merrill Lynch & Co., 273 F.Supp.2d 351, 356-57 (S.D.N.Y. 2003) (internal citations omitted), aff'd in part and reversed in part on other grounds sub nom., Lentell v. Merrill Lynch & Co., 396 F.3d 161 (2d Cir. 2005), cert. denied, 546 U.S. 935 (2005); see also Cortec Indus., Inc. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir. 1991)("[T]he district court ... could have viewed [the documents] on the motion to dismiss because there was undisputed notice to plaintiffs of their contents and they were integral to plaintiffs' claim."); Brodeur v. City of New York, No. 04 Civ. 1859 (JG), 2005 U.S. Dist. LEXIS 10865, at *9-10 (E.D.N.Y. May 13, 2005) (court could consider documents within the public domain on a Rule 12(b)(6) motion to dismiss)
The defendants argue that this court does not have subject matter jurisdiction to hear this case. For the reasons set forth below, the Court agrees.
Subject matter jurisdiction in this action is based upon diversity jurisdiction.
The Supreme Court has created an exception to diversity jurisdiction for probate matters, which "[r]eserves to state probate courts the probate or annulment of a will and the administration of a decedent's estate; it also precludes federal courts from endeavoring to dispose of property that is in the custody of a state probate court. But it does not bar federal courts from adjudicating matters outside those confines and otherwise within federal jurisdiction." Marshall v. Marshall, 547 U.S. 293, 311-12 (2006). The Second Circuit has explained that "so long as a plaintiff is not seeking to have the federal court administer a probate matter or exercise control over a res in the custody of a state court, if jurisdiction otherwise lies, then the federal court may, indeed must, exercise it." Lefkowitz v. Bank of New York, 528 F.3d 102, 106 (2d Cir. 2007). In Lefkowitz, the court found that plaintiff's claims of conversion, unjust enrichment, and other claims seeking monies owed were, "in essence, [seeking] disgorgement of funds that remain under the control of the Probate Court." Id. at 107. As such, plaintiff was seeking "to mask in claims for federal relief her complaints about the maladministration of her parent's estates," which were proceeding in probate court. Id. The court went on to hold that plaintiff's claims for breach of fiduciary duty, fraudulent misrepresentation and fraudulent concealment, which were seeking damages from defendants personally, "rather than assets or distributions from either estate," did not require the federal court to assert "control of any res in the custody of a state court" and, therefore, the probate exception did not apply. Id. at 107-108.
Although plaintiffs have made an allegation against the defendants pursuant to New York Judiciary Law § 487, it is clear that plaintiffs' complaint is founded on their belief that the Trust was mismanaged and that the Florida Probate Court did not have jurisdiction to render its decision. For example, in plaintiffs' Reply to the Order of the Court, plaintiffs state "[i]t is clear that the Florida Probate Court did not have proper jurisdiction to adjudicate a claim against the Irving G. Kates New York Trust. That judgment should be vacated by this Court." (Pl.'s Reply to the Order of the Court at ¶ 17.). In addition, plaintiffs also state that "[t]his Court had previously ruled `Probate Exception' because it accepted the action for judicial accounting in the Florida Court as real instead of the `deception and fraud that it was in fact.' This action is under New York Law because not only did Pressley bring his deception and fraud judgment to New York Courts to defeat actions in this state, but he was paid a fee by Northern Trust to do so in New York." (Id. at ¶ 5-6.) Therefore, in order to find for the plaintiffs, this Court would need to address the "[p]robate or annulment of a will and the administration of a decedent's estate . . ." which the Court does not have jurisdiction to do. Marshall, 547 U.S. at 311-12. As Judge Hurley previously ruled in November of 2005,
Philip Barash v. Northern Trust Corporation, 2009 WL 605182, at *7 (citation omitted). The same analysis applies here because in order to grant plaintiffs the relief they seek, this Court must impermissibly interfere with the Florida Probate Court's decision. Accordingly, this Court does not have jurisdiction to hear the claims set forth by the plaintiffs, and therefore, the claims are dismissed.
The defendants also note that this Court lacks jurisdiction pursuant to the Rooker-Feldman doctrine. This Court agrees.
Under the Rooker-Feldman doctrine — Rooker v. Fid. Trust Co., 263 U.S. 413 (1923), and Dist. of Columbia Court of Appeals v. Feldman, 460 U.S. 462 (1983) a United States District Court has no authority to review final judgments of a state court in judicial proceedings, except for constitutional challenges and reviews pursuant to an application for a writ of habeas corpus. As the Supreme Court held, the doctrine precludes a district court from hearing "cases brought by state-court losers complaining of injuries caused by statecourt judgments rendered before the federal district court proceedings commenced and inviting district court review and rejection of those judgments." Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 125 S.Ct. 1517, 1521-22 (2005); Hoblock v. Albany Co. Board of Elections, 422 F.3d 77, 83 (2d Cir. 2005).
As set forth at length supra, this is not plaintiffs' first attempt to disturb the ruling of the Florida Probate Court. Despite plaintiffs' several attempts, they cannot use the federal courts as a vehicle to overturn the ruling of the Florida Probate Court. Although plaintiffs state that they are seeking treble damages from the defendants for violations of New York Judiciary Law § 493, as discussed supra, it is clear based upon the reading of the complaint and the plaintiffs' subsequent submissions that they seek for this Court to overturn the decision of the Florida Probate Court, as well as the decisions of this Court and the New York State courts. Accordingly, this Court does not have jurisdiction to hear this case.
While the Court has determined that the complaint should be dismissed because it lacks jurisdiction to hear this case, in an abundance of caution, the Court has also analyzed the complaint under a Rule 12(b)(6) standard and finds, in the alternative, that it should also be dismissed under Rule 12(b)(6) on grounds of res judicata and collateral estoppel for the reasons discussed in detail below.
A court may dismiss a claim on res judicata or collateral estoppel grounds on a motion to dismiss, a motion for judgment on the pleadings, or a motion for summary judgment. See Thompson v. Cnty. of Franklin, 15 F.3d 245, 253 (2d Cir. 1994); Day v. Moscow, 955 F.2d 807, 811 (2d Cir. 1992); see also Wilson v. Ltd. Brands, No. 08 CV 3431 (LAP), 2009 WL 1069165, at *4 (S.D.N.Y. Apr. 17, 2009) (granting judgment on the pleadings based on collateral estoppel); Sassower v. Abrams, 833 F.Supp. 253, 264 n.18 (S.D.N.Y. 1993) ("[T]he defense of res judicata or collateral estoppel may be brought, under appropriate circumstances, either via a motion to dismiss or a motion for summary judgment.").
Under the doctrine of res judicata, otherwise known as claim preclusion, "`a final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.'" Flaherty v. Lang, 199 F.3d 607, 612 (2d Cir. 1999) (quoting Rivet v. Regions Bank of La., 522 U.S. 470, 476 (1998)) (internal quotation marks omitted) (emphasis added); accord Allen v. McCurry, 449 U.S. 90, 94 (1980). The doctrine applies only if "(1) the previous action involved an adjudication on the merits; (2) the previous action involved the [parties] or those in privity with them; and (3) the claims asserted in the subsequent action were, or could have been, raised in the prior action." Monahan v. New York City Dep't of Corr., 214 F.3d 275, 285 (2d Cir. 2000) (citations omitted). "In determining whether a second suit is barred by this doctrine, the fact that the first and second suits involved the same parties, similar legal issues, similar facts, or essentially the same type of wrongful conduct is not dispositive." Maharaj v.Bank America Corp., 128 F.3d 94, 97 (2d Cir. 1997). "Rather, the first judgment will preclude a second suit only when it involves the same `transaction' or connected series of transactions as the earlier suit." Id. Therefore, as the Second Circuit has noted, "the obvious starting point in a preclusion analysis is a determination of the issues that were litigated in the first action." Flaherty, 199 F.3d at 613. Furthermore, in evaluating the res judicata effect of a prior action, "courts routinely take judicial notice of documents filed in other courts, again not for the truth of the matters asserted in the other litigation, but rather to establish the fact of such litigation and related filings." Kramer v. Time Warner Inc., 937 F.2d 767, 774 (2d Cir. 1991).
Here, it is abundantly clear that plaintiffs' action is barred by the doctrine of res judicata. As fully detailed supra, the Florida Probate Court, the New York State Courts and this Court have extensively litigated the issues brought forth in this case.
First, as discussed supra, although plaintiffs disguise their claim as a claim pursuant to New York Judiciary Law § 487, it is clear based upon the statements in plaintiffs' papers that plaintiffs seek for this Court to disrupt the decision of the Florida Probate Court. However, whether or not the Trust was mismanaged was decided, on the merits, in several of plaintiffs' prior actions.
Moreover, plaintiffs were parties to the previous actions as detailed above. Plaintiffs have extensively raised the same issue in the Florida Probate Court, New York State Courts, and this Court. Although the defendants were not parties to the Florida Probate action, the prior actions in this Court, and the majority of the actions in the New York State Courts,
Accordingly, this action is precluded by the doctrine of res judicata and must be dismissed.
"`[C]ollateral estoppel ... means simply that when an issue of ultimate fact has once been determined by a valid and final judgment, that issue cannot again be litigated between the same parties in any future lawsuit.'" Leather v. Ten Eyck, 180 F.3d 420, 424 (2d Cir. 1999) (quoting Schiro v. Farley, 510 U.S. 222, 232, 114 S.Ct. 783, 127 L.Ed.2d 47 (1994)). "Collateral estoppel, like the related doctrine of res judicata, has the dual purpose of protecting litigants from the burden of relitigating an identical issue with the same party or his privy and of promoting judicial economy by preventing needless litigation." Parklane Hosiery Co. v. Shore, 439 U.S. 322, 326, 99 S.Ct. 645, 58 L.Ed.2d 552 (1979).
Under the Full Faith and Credit Act, 28 U.S.C. § 1738, federal courts must give state-court judgments the same preclusive effect as the judgment would have in the state from which it originated. See 28 U.S.C. § 1738 ("[J]udicial proceedings of any court of any ... State ... shall have the same full faith and credit in every court within the United States ... as they have by law or usage in the courts of such State ... from which they are taken"); see also Marvel Characters, Inc. v. Simon, 310 F.3d 280, 286 (2d Cir. 2002) ("We apply federal law in determining the preclusive effect of a federal judgment and New York law in determining the preclusive effect of a New York State court judgment." (internal citations omitted)). "Under New York law, collateral estoppel bars relitigation of an issue when (1) the identical issue necessarily was decided in the prior action and is decisive of the present action, and (2) the party to be precluded from relitigating the issue had a full and fair opportunity to litigate the issue in the prior action." In re Hyman, 502 F.3d 61, 65 (2d Cir. 2007) (citations omitted); accord Hoblock v. Albany Cty. Bd. of Elections, 422 F.3d 77, 94 (2d Cir. 2005).
Moreover, collateral estoppel generally does not include a requirement that the parties against whom plaintiffs litigated in the prior proceeding be the same parties they litigate against in the current proceeding. See United States v. Mendoza, 464 U.S. 154, 158, 104 S.Ct. 568, 78 L.Ed.2d 379 (1984); see also Amadasu v. Bronx Lebanon Hosp. Ctr., No. 03 Civ. 6450 (LAK)(AJP), 2005 WL 121746, at *8 (S.D.N.Y. Jan. 21, 2005) ("[T]he doctrine of collateral estoppel does not require that the same parties are named in the earlier action in order to apply to the instant action."). Additionally, a district court may raise the issue of collateral estoppel sua sponte. Doe v. Pfrommer, 148 F.3d 73, 80 (2d Cir. 1998).
Defendants argue that, in addition to being barred by the doctrine of res judicata, this action is also barred by collateral estoppel. The Court agrees.
First, the identical issue was decided on the merits in the previous state court actions on the merits. At the core of plaintiffs' action for relief under New York Judiciary Law § 487 is the issue of whether the Trust was mismanaged and whether the Florida Probate Court had jurisdiction. However, as detailed at length supra, the Florida Probate Court and the New York State courts have already decided these issues.
Moreover, the parties precluded, the plaintiffs, had a full opportunity to litigate these issues. Plaintiffs have raised these issues to the Florida Probate Court, the New York State Courts, and this Court, on several occasions. Accordingly, plaintiffs have clearly had a full opportunity to litigate these issues.
In addition, plaintiffs do not address the effect of collateral estoppel in their papers. However, in their argument regarding res judicata they argue that res judicata cannot apply because the defendants were not a party to the prior actions. However, the fact that the defendants were not parties to the Florida Probate action, or several of the New York State actions, does not affect this analysis because there is no requirement that the same parties that the plaintiff litigated against in the prior proceeding be the same parties litigated against in the current proceeding. See United States v. Mendoza, 464 U.S. at 158. Accordingly, because the same issues that are raised in this action have been raised and adjudicated on the merits, and because plaintiffs had a full and fair opportunity to litigate these issues, this action is barred by the doctrine of collateral estoppel.
The defendants also allege that even if this Court had jurisdiction to hear this case, the plaintiffs' claims are barred by the statute of limitations and, even if they were brought within the applicable time period, lack merit. Although this Court has already determined that this Court lacks jurisdiction to hear plaintiffs' claims, the Court, in an abundance of caution, has analyzed the defendants' arguments and finds that plaintiffs' claims under Judiciary Law § 487 are barred by the statute of limitations and are without merit.
First, the statute of limitations for a claim under § 487 of the Judiciary Law is three years. See Rafter v. Liddle, No 05-cv-4296, 2006 WL 2255093, at * 11 (S.D.N.Y. Aug. 4, 2006); (citing Lefkowitz v. Appelbaum, 258 A.D.2d 563, 563, 685 N.Y.S.2d 460 (App. Div. 1999) and Kuske v. Gellert & Cutler, 247 A.D.2d 448, 448, 667 N.Y.S.2d 955, 955, (App. Div. 1998)). Plaintiffs complain of acts taken by the defendants from May of 2001 through January 2005 during the Florida Probate proceeding. The complaint in this action was not filed until July 6, 2011. Accordingly, the plaintiffs' claims are time-barred.
Moreover, even if plaintiffs' had timely brought their claims, they are meritless. Pursuant to New York Judiciary Law § 487, no cause of action lies where the conduct occurred in courts outside of New York State. See Schertenlieb v. Traum, 589 F.2d 1156, 1159 (2d Cir. 1978); see also Linder v. American Express Corp., No. 06 CV 3834, 2009 WL 54493 (S.D.N.Y. Jan 8, 2009.). In this case, plaintiffs complain of acts that took place in the Florida Probate Court. Accordingly, plaintiffs' claim is without merit.
Although plaintiffs have not requested leave to amend or replead their complaint, the Court has considered whether plaintiff should be given an opportunity to replead. The Second Circuit has emphasized that
Cuoco v. Moritsugu, 222 F.3d 99, 112 (2d Cir. 2000) (quotations and citations omitted). Under Rule 15(a) of the Federal Rules of Civil Procedure, the "court should freely give leave [to amend] when justice so requires." Fed. R. Civ. P. 15(a). However, even under this liberal standard, this Court finds that any attempt to amend the pleading in this case would be futile. As discussed in detail supra, this Court lacks jurisdiction to hear plaintiffs' claims and plaintiffs' claims are barred by the doctrine of res judicata. Accordingly, it is abundantly clear that no amendments can cure the jurisdictional (and other) defects in this case, and any attempt to replead would be futile. See Cuoco, 222 F.3d at 112 ("The problem with [plaintiffs] cause[] of action is substantive; better pleading will not cure it. Repleading would thus be futile. Such a futile request to replead should be denied."); see also Hayden v. Cnty.of Nassau, 180 F.3d 42, 53 (2d Cir. 1999) (holding that if a plaintiff cannot demonstrate he is able to amend his complaint "in a manner which would survive dismissal, opportunity to replead is rightfully denied").
For the foregoing reasons, plaintiffs' claims are dismissed, pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure. The Court will issue a separate order to Show Cause regarding defendants' request for sanctions (including a litigation injunction) and will provide plaintiffs with an opportunity to be heard regarding the sanctions sought.
SO ORDERED.
