V. Quicken Loans, Inc.

Western District of Texas, txwd-5:2019-cv-00697

MOTION for Order to Show Cause by Quicken Loans, Inc.

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IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS SAN ANTONIO DIVISION PABLO E. GAY and ANNA J. SUBIA § aka ANNA J. SUBIA-GAY, § § Plaintiffs, § § v. § Civil Action Number: 5:19-CV-00697-OLG § QUICKEN LOANS INC., § § Defendant. § § DEFENDANT QUICKEN LOANS INC.'S MOTION FOR ORDER TO SHOW CAUSE WHY THIS CASE SHOULD NOT BE DISMISSED UNDER RULE 41 NOW COMES the defendant, Quicken Loans Inc. ("Quicken Loans"), and requests that this Court issue an order to show cause why this case should not be dismissed pursuant to Rule 1 41, Federal Rules of Civil Procedure. Fed. R. Civ. P. 41. The plaintiffs are opposed to this Motion. In support of this Motion, Quicken Loans respectfully shows the Court the following: I. INTRODUCTION This is the third case involving the very same property located at 10143 Silverbrook Place, San Antonio, Texas 78254, filed by Pablo Gay and Anna Subia-Gay (collectively, "Plaintiffs") against Quicken Loans to stop a valid and properly-noticed trustee's sale. Plaintiffs voluntarily dismissed the first two cases. Under Rule 41(a)(1)(b), "if the plaintiff previously dismissed any federal- or state-court action based on or including the same claim, a notice of dismissal operates as an adjudication on the merits." Fed. R. Civ. P. 41(a)(1)(B). Thus, Plaintiffs' claims are barred by two-dismissal rule. 1 All references to rules herein are to the Federal Rules of Civil Procedure. Defendant Quicken Loans Inc.'s Motion for Order to Show Cause Page 1 DA 404478.3 Furthermore, the plaintiffs failed to comply with the Order and Advisory [Doc. 8] requiring the parties to notify the Court whether or not they consent to Magistrate Judge jurisdiction. In fact, between the three cases involving Plaintiffs and Quicken Loans that have been pending in this Court over the last thirteen (13) months, Plaintiffs have failed to comply with this Court's orders on at least three separate occasions, as discussed in more detail below. Under Rule 41(b), "[i]f the plaintiff fails to prosecute or to comply with these rules or a court order, a defendant may move to dismiss the action or any claim against it." Fed. R. Civ. P. 41(b). Moreover, plaintiffs' counsel has a history of failing to prosecute cases pending in this Court, failing to comply with court orders, and failing to respond to motions. This is the fourteenth case since only November 2017 in which plaintiffs' counsel has represented various plaintiffs in the U.S. District Court for the Western District of Texas. A chart with information about these fourteen cases is attached hereto as Exhibit A and incorporated herein by reference. Four of those cases were dismissed pursuant to Rule 12(b)(6), 2 and in three of those cases, the plaintiffs failed to file a response to the defendants' Rule 12(b)(6) motions. 3 Another three cases were dismissed voluntarily after the defendants filed Rule 12(b)(6) motions. 4 One case was dismissed after the plaintiffs failed to respond to a motion for summary judgment. 5 Another three cases were voluntarily dismissed before a defendant even filed an initial responsive pleading. 6 Another case was dismissed with prejudice for failure to prosecute after the plaintiffs failed to 2 Case No. 1:17-cv-01162-RP; Case No. 1:19-cv-00051-LY; Case No. 5:18-cv-00849-OLG; Case No. 5:19-cv-00704-FB-ESC. 3 Case No. 1:19-cv-00051-LY; Case No. 5:18-cv-00849-OLG; Case No. 5:19-cv-00704-FB-ESC. 4 Case No. 1:18-cv-00250-RP; Case No. 1:18-cv-01020-RP; Case No. 1:19-cv-00091-RP. 5 Case No. 1:17-cv-01064-RP. 6 Case No. 5:17-cv-00750-OLG; Case No. 5:18-cv-00410-OLG; Case No. 5:19-cv-00387-OLG. Defendant Quicken Loans Inc.'s Motion for Order to Show Cause Page 2 DA 404478.3 respond to an order to show cause.7 A true and correct copy of the Order to show cause from that case is attached hereto as Exhibit B and incorporated herein by reference. In another case, plaintiffs' counsel failed to comply with an Order to file a statement of jurisdiction.8 Notably, in the only other case that is still open, there is show cause order currently pending against plaintiffs' counsel,9 a true and correct copy of which is attached hereto as Exhibit C and incorporated herein by reference. II. BACKGROUND On April 17, 2018, Plaintiffs filed a Petition and Application for Temporary Restraining Order against Quicken Loans in the District Court of Bexar County, Texas, to prevent Quicken Loans from proceeding with a trustee's sale of real property located at 10143 Silverbrook Place, San Antonio, Texas 78254 (the "Property"). Quicken Loans removed the case to this Court, and it was assigned Case No. 5:18-cv-00410-OLG (the "First Action"). After removal, Plaintiffs never sought a temporary restraining order or preliminary injunction from this Court. On August 13, 2018, this Court entered the Scheduling Order 10 requiring, inter alia, "[t]he parties asserting claims for relief shall submit a written offer of settlement to opposing parties by Monday, November 12, 2018 and each opposing party shall respond, in writing, by Monday, November 26, 2018." Plaintiffs, however, failed to comply with the Scheduling Order, so Quicken Loans filed its Notice of Non-Receipt of Written Offer of Settlement 11 on November 26, 2018. 7 Case No. 1:18-cv-01020-RP. 8 Case No. 1:18-cv-00227-LY. 9 Case No. 5:19-cv-00704-FB-ESC. 10 Case No. 5:18-cv-00410-OLG, Doc. 4. 11 Id. at 7. Defendant Quicken Loans Inc.'s Motion for Order to Show Cause Page 3 DA 404478.3 Furthermore, Plaintiffs never served Quicken Loans in the First Action. As a result, on November 27, 2018, the Court issued its Order12 requiring "that Plaintiff[s] serve Defendant within thirty (30) days of the date of this Order." Again, Plaintiffs failed to comply with the Court's Order, so on January 2, 2019, Quicken Loans filed its Second Status Report on Service of Process.13 The next day, Plaintiffs filed their Notice of Voluntary Dismissal 14 in the First Action, a true and correct copy of which is attached hereto as Exhibit D and incorporated herein by reference. Next, on May 31, 2019, Plaintiffs filed another Petition and Application for Temporary Restraining Order against Quicken Loans in the District Court of Bexar County, Texas, and obtained an ex parte Temporary Restraining Order entered on April 1, 2019, preventing Quicken Loans from proceeding with a trustee's sale of the Property. Again, Quicken Loans removed the case to this Court, where it was assigned Case No. 5:19-cv-00387-OLG (the "Second Action"). After removal, Plaintiffs never sought a temporary restraining order or preliminary injunction from this Court. On May 31, 2019, Plaintiffs filed their Notice of Voluntary Dismissal 15 in the Second Action, a true and correct copy of which is attached hereto as Exhibit E and incorporated herein by reference. The very same day Plaintiffs dismissed the Second Action, on May 31, 2019, Plaintiffs filed a third Petition and Application for Temporary Restraining Order against Quicken Loans in the District Court of Bexar County, Texas, to prevent Quicken Loans from proceeding with a trustee's sale of the Property. On June 4, 2019, Plaintiffs obtained a second ex parte Temporary 12 Id. at Doc. 8. 13 Id. at Doc. 9. 14 Id. at Doc. 10. 15 Case No. 5:19-cv-00387-OLG, Doc. 4. Defendant Quicken Loans Inc.'s Motion for Order to Show Cause Page 4 DA 404478.3 Restraining Order preventing Quicken Loans from proceeding with a trustee's sale of the Property. For the third time, on June 14, 2019, Quicken Loans removed the case to this Court, where it was assigned Case No. 5:19-cv-00697-OLG (the "Instant Action"). Since removal, Plaintiffs have not sought a temporary restraining order or preliminary injunction from this Court. On August 12, 2019, this Court issued its Order and Advisory16 requiring the parties to notify the Court within thirty day whether or not they consent to Magistrate Judge jurisdiction. As of the date of this Motion, Plaintiffs have not complied with that Order. Thus, between the First Action and the Instant Action, Plaintiffs have failed to comply with this Court's orders on three occasions. III. RULE 41(a)(1)(B) The effect of Plaintiffs' dismissal of the Second Action is determined by Rule 41(a)(1)(B)'s two-dismissal rule, which applies on its face to these facts: "Unless the notice or stipulation states otherwise, the dismissal is without prejudice. But if the plaintiff previously dismissed any federal- or state-court action based on or including the same claim, a notice of dismissal operates as an adjudication on the merits." Fed. R. Civ. P. 41(a)(1)(B). "[T]he purpose of the two-dismissal rule under Rule 41(a)(1)(B) is to prevent unreasonable abuse and harassment brought about by duplicative litigation" by the plaintiff. American Cyanamid Co. v. McGhee, 317 F.2d 295, 297 (5th Cir. 1963). Thus, a plaintiff's voluntary dismissal of a second lawsuit "closes the case with prejudice to the bringing of another." Id. In other words, though the dismissal of the Second Action was voluntary, it acts as a final judgment on the merits under Rule 41. See Fed. R. Civ. P. 41(a)(1)(B). 16 Doc. 8. Defendant Quicken Loans Inc.'s Motion for Order to Show Cause Page 5 DA 404478.3 By Rule 41(a)(1)(B)'s plain language, Plaintiffs' Notice of Voluntary Dismissal 17 in the Second Action operated as a dismissal with prejudice. See 9 Wright & Miller, Federal Practice and Procedure § 2368 (3d ed). As such, Plaintiffs could not bring further claims based on the same facts against Quicken Loans. Yesh Music v. Lakewood Church, 727 F.3d 356, 363 (5th Cir. 2013) ("[T]he well-known legal consequence of two voluntary dismissals is an inability to re-file the complaint."); Commercial Space Mgmt. Co. v. Boeing Co., 193 F.3d 1074, 1076 (9th Cir. 1999) ("a voluntary dismissal of a second action operates as a dismissal on the merits if the plaintiff has previously dismissed an action involving the same claims."). The two-dismissal rule applies even if the second notice of dismissal states that the dismissal is without prejudice. Commercial Space Mgmt. Co, 193 F.3d at 1076 ("it does not matter what label the plaintiff attaches to a second voluntary dismissal."). Accordingly, Plaintiffs are barred from bringing the claims asserted against Quicken Loans in the Instant Action pursuant to Rule 41(a)(1)(B). IV RULE 41(b) In the First Action, Plaintiff failed to comply with this Court's Scheduling Order 18 requiring a settlement offer and this Court's Order19 requiring service. In the Instant Action, Plaintiffs similarly failed to comply with the Order and Advisory20 regarding Magistrate Judge jurisdiction. Moreover, as discussed above, plaintiffs' counsel has a history of failing to prosecute cases pending in this Court, failing to comply with court orders, and failing to respond to motions. 17 Case No. 5:19-cv-00387-OLG, Doc. 4. 18 Case No. 5:18-cv-00410-OLG, Doc. 4. 19 Id. at Doc. 8. 20 Doc. 8. Defendant Quicken Loans Inc.'s Motion for Order to Show Cause Page 6 DA 404478.3 Under Rule 41(b), a court may order the dismissal of an action "[i]f the plaintiff fails to prosecute or to comply with these rules or a court order." Fed. R. Civ. P. 41(b); Larson v. Scott, 157 F.3d 1030, 1031 (5th Cir. 1998); see generally McCullough v. Lynaugh, 835 F.2d 1126 (5th Cir. 1988) (a district court may dismiss an action for failure to prosecute or to comply with an order of the court); Magnuson v. Elec. Data Sys. Corp., 252 F.3d 436, 2001 WL 360841 (5th Cir. 2001); Beard v. Experian Info. Sols. Inc., 214 F. App'x 459 (5th Cir. 2007). "This authority [under Rule 41(b)] flows from the court's inherent power to control its docket and prevent undue delays in the disposition of pending cases." Boudwin v. Graystone Ins. Co., Ltd., 756 F.2d 399, 401 (5th Cir. 1985) (citing Link v. Wabash R.R. Co., 370 U.S. 626 (1962)). The exercise of the power to dismiss for failure to prosecute is committed to the sound discretion of the Court and appellate review is confined solely to whether the Court's discretion was abused. Green v. Forney Eng'g Co., 589 F.2d 243, 248 (5th Cir. 1979); Lopez v. Aransas County Indep. Sch. Dist., 570 F.2d 541, 544 (5th Cir. 1978). Accordingly, the Instant Action should be dismissed pursuant to Rule 41(b). V. PRAYER WHEREFORE, Quicken Loans respectfully requests that this Court enter an order to show cause why this case should not be dismissed with prejudice pursuant to Rule 41. Quicken Loans further requests all relief, at law or in equity, to which it is entitled. Defendant Quicken Loans Inc.'s Motion for Order to Show Cause Page 7 DA 404478.3 Respectfully submitted this 1st day of October 2019. By: /s/ Jacob Sparks Jacob Sparks Texas Bar No. 24066126 SPENCER FANE LLP 5700 Granite Parkway, Suite 650 Plano, Texas 75024 Tel: (972) 324-0300 Fax: (972) 324-0301 Email: JSparks@SpencerFane.com ATTORNEYS FOR DEFENDANT QUICKEN LOANS INC. CERTIFICATE OF CONFERENCE The undersigned certifies that plaintiff's counsel is opposed to the relief requested in the foregoing Motion. By: /s/ Jacob Sparks Jacob Sparks CERTIFICATE OF SERVICE I certify that a true and correct copy of the foregoing Motion was served upon the following parties/counsel of record pursuant to the Federal Rules of Civil Procedure through the Court's ECF system on October 1, 2019: By: /s/ Jacob Sparks Jacob Sparks Defendant Quicken Loans Inc.'s Motion for Order to Show Cause Page 8 DA 404478.3