Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_16-cv-01743/USCOURTS-caed-1_16-cv-01743-0/pdf.json

Nature of Suit Code: 380
Nature of Suit: Other Personal Property Damage
Cause of Action: 28:1332 Diversity-Property Damage

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

HUSSEIN ALI,

Plaintiff,

v.

HUDSON INSURANCE COMPANY; 

AMERICAN SAFETY CASUALTY 

INSURANCE COMPANY; AEGIS 

SECURITY INSURANCE COMPANY; 

and PHILADELPHIA INDEMNITY 

INSURANCE COMPANY,

Defendants.

Case No. 1:16-cv-01743-DAD-EPG

FINDINGS AND RECOMMENDATIONS 

REGARDING PLAINTIFF’S MOTION TO 

PROCEED IN FORMA PAUPERIS

(ECF No. 2)

Plaintiff Hussein Ali, proceeding pro se, filed an application to proceed in forma pauperis

(“IFP”) on November 17, 2016. (ECF No. 2.) For the reasons that follow, the Court

RECOMMENDS that Plaintiff’s application be DENIED.

An action may proceed despite a plaintiff’s failure to prepay a filing fee only if the 

plaintiff is granted leave to proceed IFP under 28 U.S.C. § 1915(a). To receive such leave, a 

plaintiff must submit an affidavit showing his or her inability to pay the requested fees. 28 U.S.C. 

§ 1915(a); O’Laughlin v. Doe, 920 F.2d 614, 617 (9th Cir. 1990). A demonstration of inability to 

pay requires that a plaintiff show that he or she “cannot because of poverty pay or give security 

for the costs and still be able to provide himself and dependents with the necessities of life.” 

Adkins v. E.I. DuPont de Nemours & Co., 335 U.S. 331, 339 (1948). The determination whether a 

Case 1:16-cv-01743-DAD-EPG Document 4 Filed 12/12/16 Page 1 of 4
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party can proceed IFP is a “matter within the discretion of the trial court and in civil actions for 

damages should be allowed only in exceptional circumstances.” Schweitzer v. Scott, 469 F.Supp. 

1017, 1019 (C.D. Cal. 1979), quoting Weller v. Dickinson, 314 F.2d 598, 600 (9th Cir. 1963); 

Franklin v. Murphy, 745 F.2d 1221, 1231 (9th Cir. 1984) (“court permission to proceed in forma 

pauperis is itself a matter of privilege and not right; denial of in forma pauperis status does not 

violate the applicant’s right to due process”). 

In examining an application for IFP status, “even-handed care must be employed to assure 

that federal funds are not squandered to underwrite, at public expense, either frivolous claims or 

the remonstrances of a suitor who is financially able, in whole or in material part, to pull his own 

oar.” Temple v. Ellerthorpe, 586 F.Supp. 848, 850 (D. R.I. 1984) (“petitioners with modest cash 

reserves are not paupers within the intendment of 28 U.S.C. § 1915(a) for the purpose of filing 

fees, initial service of process costs and the like”). A claim is ‘frivolous’ when it is without ‘basis 

in law or fact,’ and ‘malicious’ when it is ‘filed with the intention or desire to harm another.’” 

Knapp v. Hogan, 738 F.3d 1106, 1109 (9th Cir. 2013). A finding of frivolity in this context is 

equivalent to finding a lack of good faith. Id. at 1110. A lack of good faith can be inferred where 

“plaintiffs seek to exploit the court system solely for delay or to vex defendants.” Vega v. 

JPMorgan Chase Bank, N.A., 654 F.Supp.2d 1104, 1121 (E.D. Cal. 2009). The Court may 

consider “the records and files of the court or other material properly noticed by the court” to 

evaluate whether a claim is frivolous. Franklin, 745 F.2d at 1231.

In this instance, the Court takes judicial notice of Ali v. Hudson Insurance Company et al., 

Case No. 1:16-cv-00409-DAD-EPG (“Ali I”), which alleges claims against no less than 16 

separate defendants, including the defendants in the present case.1The docket of Ali I reflects that 

the Defendants in this case were voluntarily dismissed from Ali I by Plaintiff on July 13, 2016 

and August 18, 2016. The complaint in Ali I appears to be substantially similar to the complaint in 

this case, in that both allege that Plaintiff loaned a sum of money to two individuals, did not 

 

1 The Court may take judicial notice “of proceedings in other courts, both within and without the federal judicial 

system, if those proceedings have a direct relation to matters at issue.” United States v. Black, 482 F.3d 1035, 1041 

(9th Cir. 2006), quoting United States ex rel. Robinson Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244, 

248 (9th Cir. 1992).

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receive repayment from those individuals, and assert a host of claims against those individuals, as 

well as a number of other defendants that are even tangentially related to those individuals. The 

defendants in the present case allegedly provided bonds or insured property owned by the 

corporate defendants associated with the two individuals. Plaintiff appears to have dismissed the 

insurance company defendants shortly after motions to dismiss were filed on their behalf in Ali I.

The Court also takes judicial notice of a case in Fresno County Superior Court, Ali v. 

Jawad et al., Case No. 14 CE CG 03594 (“Ali II”), which included claims against Defendants 

Hudson Insurance Company, American Safety Casualty Insurance Company, and Aegis Security 

Insurance Company, among a dozen other defendants. The claims Ali II appear to arise out of the 

same set of facts. The claims against Defendants Hudson Insurance Company, American Safety 

Casualty Insurance Company, and Aegis Security Insurance Company in Ali II were dismissed 

without leave to amend by the court on June 1, 2015. The initial complaint in Ali I was filed 

shortly thereafter, on June 30, 2015.

The Court thus finds that the Complaint in this action is not filed in good faith and has 

been filed to delay proceedings and harass the Defendants. While the Court does not reach the 

merits of any of Plaintiff’s allegations at this point in time, it can determine based on these facts 

that Plaintiff is not entitled to proceed without prepayment of the $400 filing fee. Very little 

suggests that this case should fall within the “exceptional circumstances” justifying IFP status. 

Based on the foregoing, the Court RECOMMENDS that:

1. Plaintiff’s Application to Proceed In Forma Pauperis (ECF No. 2) be DENIED; and,

2. Plaintiff be required to submit the filing fee of $400.

These findings and recommendations will be submitted to the United States District Judge 

assigned to this case pursuant to the provisions of Title 28 of the United States Code section 

636(b)(1). Within fourteen (14) days after being served with these findings and 

recommendations, the parties may file written objections with the Court. The document should be 

captioned “Objections to Magistrate Judge’s Findings and Recommendations.” 

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The parties are advised that failure to file objections within the specified time may waive 

the right to appeal the District Court’s order. Bastidas v. Chappell, 791 F.3d 1155, 1159 (9th Cir. 

2015).

IT IS SO ORDERED.

Dated: December 12, 2016 /s/

UNITED STATES MAGISTRATE JUDGE

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