Court Opinion

ID: 4349037
Source: CourtListenerOpinion
Date Created: 2018-12-10 21:55:39.677016+00
Date Added: 2024-06-11T11:27:12.380898
License: Public Domain

[Cite as Fatica Renovations, L.L.C. v. Bridge, 2018-Ohio-4949.]

                                     IN THE COURT OF APPEALS

                                 ELEVENTH APPELLATE DISTRICT

                                       GEAUGA COUNTY, OHIO

 FATICA RENOVATIONS, LLC,                                 :       OPINION

                   Plaintiff-Appellee,                    :
                                                                  CASE NO. 2018-G-0150
         - vs -                                           :

 WILLIAM W. BRIDGE, III, et al.,                          :

                   Defendant-Appellant.                   :

 Civil Appeal from the Geauga County Court of Common Pleas, Case No. 2016 M
 000919.

 Judgment: Affirmed.

 David L. Van Slyke, Plunkett & Cooney, P.C., 300 East Broad Street, Suite #590,
 Columbus, OH 43215 (For Plaintiff-Appellee).

 William W. Bridge, III, pro se, PMB 50931, 700 North Valley Street, Suite B., Anaheim,
 CA 92801 (Defendant-Appellant).

THOMAS R. WRIGHT, P.J.

        {¶1}      Appellant, William W. Bridge, III, appeals the ruling granting summary

judgment in favor of substituted plaintiffs, Adam and Courtney Cramer, on their claims for

injunctive relief and to quiet title.            He argues that the order enjoining him from

disseminating information regarding ownership of the at-issue real property violates his

constitutional right to free speech. We affirm.

        {¶2}      This action concerns the legal interest appellant and his wife, Lisa Bridge,
continue to claim in a home and land in Russell, Geauga County, Ohio, despite that

property having been sold in foreclosure in November 2013. In November 2001, Lisa

was the sole owner of the property as a result of a quit claim deed appellant executed in

her favor. On December 7, 2001, she signed a promissory note for $467,000, payable to

Aames Home Loan and executed and delivered an open-end mortgage to Aames Home

Loan as security.

      {¶3}   Over the next few years, the Bridges lived on the Russell property and made

payments on the loan. At some point, Aames Home Loan assigned the mortgage to

Bankers Trust of California, N.A. in Trust for the Benefit of the Holders of Aames Mortgage

Trust 2002-1 Mortgage Pass Through Certificates Series 2002-1.              Following the

assignment, Bankers Trust of California changed its name to Deutsche Bank N.A.

      {¶4}   In September 2007, appellant and Lisa brought an action against several

defendants in the United States District Court for the Northern District of Ohio, asserting

that multiple violations of federal statutes occurred during servicing of their loan. Both

Aames Home Loan and Deutsche Bank were named as defendants. After the case had

been pending for five years, Deutsche Bank filed a counterclaim for foreclosure, alleging

that Lisa was in default on the loan payments.

      {¶5}   On September 6, 2013, the district court granted Deutsche Bank’s motion

for summary judgment on its counterclaim, and ordered that the Russell property be sold

in foreclosure. A Master Commissioner was appointed to execute the sale, set for

November 25, 2013.

      {¶6}   On the same day as the scheduled sale, appellant appeared at the clerk’s

office of the United States Bankruptcy Court for the Northern District of Ohio to file a

bankruptcy petition on behalf of Lisa. The clerk accepted the filing fee and wrote at the

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top of the bankruptcy petition that appellant attempted to submit the petition on November

25, 2013. However, since appellant was not a licensed attorney and did not have a power

of attorney to act on his wife’s behalf, the clerk did not time-stamp the petition as filed on

that date.    Instead, Lisa’s bankruptcy petition was not filed until the following day,

November 26, 2013.

       {¶7}    The Master Commissioner’s sale of the subject property went forward as

scheduled, and Deutsche Bank purchased it for $213,333.33. After the bank moved the

district court to confirm the sale, the Bridges submitted two sets of objections to the

proceeding. In the second set, they asserted that the sale must be declared null and void

because Lisa had invoked the automatic stay provision of a federal bankruptcy action

prior to the sale.    In essence, the Bridges argued that the bankruptcy action was

“instituted” for purposes of the automatic stay when appellant handed the petition to the

bankruptcy court clerk. In addition to their objections, the Bridges moved for relief from

the foreclosure judgment under Civ.R. 60(B).

       {¶8}    In February 2015, the federal district court rendered two judgments. In the

first judgment, the district court overruled the Bridges’ objections to the sale. The court

rejected their “automatic stay” argument, holding that, Lisa’s bankruptcy petition was not

filed when presented, but rather the day after the Master Commissioner’s sale. In its

second judgment, the district court confirmed the sale to Deutsche Bank. In May 2015,

the Master Commissioner, therefore, filed a deed with the Geauga County Recorder

documenting the transfer.

       {¶9}    The Bridges filed three appeals before the Sixth Circuit Court of Appeals in

regard to the foreclosure proceeding. While these appeals were pending, the Bridges

submitted an Affidavit and Notice of Lis Pendens with the Geauga County Recorder,

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claiming to have an interest in the Russell property as a consequence of the pending

appeals. In October 2015, however, the federal appellate court dismissed all three

appeals for lack of prosecution.

       {¶10} Approximately six months later, in March 2016, the Bridges submitted an

amended Affidavit and Notice of Lis Pendens, again claiming an interest in the property

due to pending 60(B) motion for relief from the foreclosure order from the federal district.

       {¶11} After the sale to Deutsche Bank was confirmed, the Bridges vacated and

moved to an abutting property owned by Lisa’s mother. After filing the amended Notice

of Lis Pendens, appellant taped a copy to the front door of his prior residence.

       {¶12} After holding the Russell property for approximately one year, Deutsche

Bank placed the property for sale via internet auction. Prior to the auction, potential

bidders were permitted to view the property. During viewing, Lou Fatica, the sole owner

of Fatica Renovations, LLC, saw the copy of the Notice of Lis Pendens taped to the front

door. After being informed by two different titles companies that the Bridges did not have

a valid claim to the property, Fatica submitted the winning bid in the auction, agreeing to

pay $285,584 for it. In June 2016, Deutsche Bank filed a special warranty deed with the

Geauga County Recorder conveying the property to Fatica Renovations.

       {¶13} Over the next three months, Fatica made significant improvements to the

residence. Once the improvements were completed, he hired a licensed broker to sell

the property, listing for $685,000. On November 6, 2016, the broker held an open house.

When leaving the open house, she noticed that a professional sign had been erected on

Lisa’s mother’s property instructing to tune-in to a low frequency a.m. radio station if they

wanted to know more about the ownership. Upon tuning in the station, the broker heard

a recorded message stating that the property’s prior owner had lost it in a wrongful

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foreclosure action, and that she was still trying to have the foreclosure sale declared null

and void. The message further warned that no one should purchase the property without

first consulting a lawyer.

       {¶14} Appellant was responsible for the sign recording. Fatica also learned that

appellant had a website that set forth identical information stated in the recorded

message.      In response, Fatica Renovations instituted the underlying action.        The

complaint seeks a declaratory judgment, injunctive relief, to quiet title, and damages for

slander to title.

       {¶15} Initially, the trial court denied Fatica Renovations’ motion for a temporary

restraining order because it did not adequately state the efforts made to provide notice to

the Bridges. Nevertheless, the trial court scheduled a hearing on Fatica Renovations’

motion for a preliminary injunction for December 5, 2016. Prior to that date, Fatica

Renovations’ counsel had failed to serve the complaint on the Bridges.            Counsel,

however, informed appellant of the hearing date via an email. Appellant was therefore

present at the hearing and was served with a copy of the complaint immediately before

the hearing began. Service on Lisa did not occur until after the trial court granted a

preliminary injunction.

       {¶16} The preliminary injunction enjoins the Bridges from doing anything to

interfere with Fatica Renovations’ efforts to sell the subject property and requires release

of the two Notices of Lis Pendens, termination of the website, and removal of the sign.

Appellant, acting pro se and by himself, immediately appealed, but we dismissed for lack

of a final judgment. See Fatica Renovations, LLC v. Bridge, 11th Dist. Geauga No. 2017-

G-0106, 2017-Ohio-1419.

       {¶17} During the pendency of the foregoing appeal, Fatica Renovations sold the

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home and property to Adam and Courtney Cramer. Following our dismissal, the Cramers

became substitute plaintiffs in place of Fatica Renovations, no longer with any interest in

the outcome.

       {¶18} In conjunction with the motion to substitute, the Cramers also gave notice

to dismiss their slander to the title claim. The action proceeded on the three remaining

claims for a permanent injunction, declaratory judgment, and to quiet title.

       {¶19} The Bridges ultimately filed an answer to the complaint on September 5,

2017, approximately one week after the Cramers moved in the alternative for default

judgment or summary judgment on all remaining claims. After the answer was filed, the

Cramers reasserted their summary judgment motion. In relation to all three claims, they

contended that, as a consequence of the foreclosure proceedings, the Bridges no longer

had any legal interest in the Russell property. The Cramers also argued that the Bridges

were barred by collateral estoppel from relitigating whether Lisa’s bankruptcy petition

invoked the automatic stay provision prior to the foreclosure sale. In support, the Cramers

attached to their motion copies of various submissions and judgments from both the

bankruptcy and foreclosure proceedings.

       {¶20} In response, appellant moved to strike the motion for summary judgment,

maintaining that, since Fatica Renovations sold the property to the Cramers, the

permanent injunction claim was moot. Appellant also argued the “automatic stay” issue

asserting delivery of the petition to the bankruptcy clerk and paying the filing fee invoked

the stay provision, thereby rendering the foreclosure sale null and void.

       {¶21} After allowing appellant additional time to complete discovery, the trial court

denied his motion to strike the Cramers’ summary judgment motion. The court rejected

appellant’s assertion that the bankruptcy stay was invoked prior to the foreclosure and

                                             6
that, regardless, it did not have the authority to overturn the federal district court’s ruling

on the issue.

       {¶22} Thereafter, in a separate judgment, the trial court granted summary

judgment in favor of the Cramers. The court held that appellant was not permitted to

collaterally attack the federal district court’s rejection of his “automatic stay” argument in

the context of this case. Based upon this, the court further concluded that the foreclosure

sale was valid, and that appellant and Lisa no longer have any interest in the Russell

property. Therefore, the Cramers were entitled to a judgment removing all clouds on their

title and a permanent injunction enjoining the Bridges from disseminating information

asserting that they have an interest.

       {¶23} As in the first appeal, only appellant, William W. Bridge, III, has appealed

the summary judgment determination. He raises three assignments for review:

       {¶24} “[1.] The trial court erred in granting appellees’ motions for preliminary and

permanent injunctions because the preliminary and permanent injunctions violate

appellant’s right to free speech.

       {¶25} “[2.] The trial court erred in scheduling and holding the preliminary injunction

hearing when it became aware both defendants were not served with the summons and

complaint, and appellant was served with summons and complaint in the courtroom just

moments before the preliminary hearing commenced, and by failing to dismiss the

complaint or reschedule the hearing to ensure service of process on all parties providing

defendants with fair and reasonable notice sufficient to prepare for the preliminary

injunction hearing.

       {¶26} “[3.] The trial court erred in granting judgment when appellant was denied

minimal due process throughout the trial court proceedings, rendering the judgment void

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ab initio.”

        {¶27} Under his first assignment, appellant contends that the permanent

injunction is unlawful because it violates his right to free speech under the First

Amendment.       The injunction prohibits appellant from disseminating information

suggesting that he and his wife have an interest in the Russell property. There is no

dispute that the speech at issue constitutes commercial speech.

        {¶28} “Commercial speech is afforded less constitutional protection than other

constitutionally guaranteed expression. Accordingly, the United States Supreme Court in

Central Hudson Gas & Electric Corp. v. Public Service Comm. of N.Y., [477 U.S. 557,

100 S.Ct. 2343, 65 L.Ed.2d 341 (1980)] promulgated a four-part test for assessing

governmental restrictions on commercial speech as distinguished from more fully

protected speech. First, only commercial speech that is truthful and not misleading

receives First Amendment protection. Second, a restriction on truthful, not misleading

commercial speech must seek to implement a substantial governmental interest. Third,

the restriction must directly advance the governmental interest involved. Finally, the

restriction must not be more extensive than necessary to serve that interest.” (Footnotes

and citations omitted.) Genesis Outdoor, Inc. v. Cuyahoga Heights, 8th Dist. Cuyahoga

No. 79781, 2002-Ohio-2141, ¶23.

        {¶29} As the first prong of Central Hudson states, the First Amendment does not

provide any protection for commercial speech that is false or misleading. First Resort,

Inc. v. Herrera, 80 F.Supp.3d 1043, 1049-1050 (N.D.Calif.2015). Given that the primary

purpose of commercial speech is to provide information to the public by means of

advertising, such speech can be suppressed when the stated information is likely to

deceive the public. Id.

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       {¶30} Commercial speech has been defined in two ways. First, it has been

described as “‘speech that does no more than propose a commercial transaction.’” Tipp

City v. Dakin, 186 Ohio App.3d 558, 2010-Ohio-1013, 929 N.E.2d 484, ¶31 (2d Dist.),

quoting United States v. United Foods, Inc., 533 U.S. 405, 409, 121 S.Ct. 2334, 150

L.Ed.2d 438 (2001). Second, it has been characterized as an “‘expression related solely

to the economic interest of the speaker and its audience.’” Id., quoting Central Hudson,

477 U.S. at 561.

       {¶31} There is no factual dispute that the statements made about the ownership

of the property were false. Appellant’s assertion that he or Lisa maintained an interest in

the property was based upon legal arguments decided against him by the federal district,

court and his appeal was dismissed for failure to prosecute

       {¶32} Res judicata is applicable to final judgments of a federal district court; i.e.,

a party is barred from re-litigating a matter in a state court that was previously decided in

a federal court. Rogers v. City of Whitehall, 25 Ohio St.3d 67, 70, 494 N.E.2d 1387

(1986). The doctrine of res judicata covers two related concepts: claim preclusion and

issue preclusion. O’Nesti v. DeBartolo Realty Corp., 113 Ohio St.3d 59, 2007-Ohio-1102,

862 N.E.2d 803, ¶6.      As relevant to our case, issue preclusion “serves to prevent

relitigation of any fact or point that was determined by a court of competent jurisdiction in

a previous action between the same parties or their privies. [Fort Frye Teachers Assn.,

OEA/NEA v. State Emp. Relations Bd. (1998), 81 Ohio St.3d 392,] at 395, 692 N.E.2d

140. Issue preclusion applies even if the causes of action differ. Id.” Id. at ¶7.

       {¶33} As to the “privity” requirement, the Supreme Court of Ohio has stated that

“‘privity “is merely a word used to say that the relationship between the one who is a party

on the record and another is close enough to include that other within res judicata.”

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Bruszewski v. United States (C.A.3, 1950), 181 F.2d 419, 423 (Goodrich, J., concurring).’”

Brown v. Dayton, 89 Ohio St.3d 245, 248, 730 N.E.2d 958 (2000), quoting Thompson v.

Wing, 70 Ohio St.3d 176, 184, 637 N.E.2d 917 (1994).

       {¶34} Under the facts of this case, Deutsche Bank was a party to the foreclosure

action and purchased the property at the foreclosure sale. The bank subsequently sold

the property to Fatica Renovations, which then conveyed it to the Cramers. Given that

the Cramers presently have the same interest as to the confirmation of the foreclosure

sale that Deutsche Bank did during the federal action, they are in privity with the bank.

Accordingly, since res judicata is applicable in this situation, the trial court correctly held

the federal district court’s ruling on appellant’s “automatic stay” argument is binding, and

appellant cannot relitigate the issue for purposes of this case.

       {¶35} As part of a general discussion in his appellate brief, appellant argues that

a sale in violation of a bankruptcy stay is “null and void” for all purposes. By wording his

argument in this way, he raises the specter that a violation of a bankruptcy stay is akin to

a lack of subject matter jurisdiction. Even assuming arguendo that this comparison is

justified, the fact that an issue pertains to subject matter jurisdiction does not mean that

a party will be allowed to reargue the issue on multiple occasions. Once the party has

had a full opportunity to argue the issue before a court of competent jurisdiction, he can

only attack the validity of the decision through a direct appeal. See CitiMortgage, Inc. v.

Oates, 2013-Ohio-5077, 4 N.E.2d 1101 (11th Dist.).

       {¶36} As a final point, during the period immediately prior to the filing of this case

by Fatica Renovations, part of appellant’s contention that he and Lisa might be restored

as owners of the property was predicated upon the fact that their Civ.R. 60(B) motion for

relief from the foreclosure judgment was still pending in the federal district court. But,

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only one day after this case was initiated, that motion was denied. Thus, when the

permanent injunction was granted, it barred only false statements as permitted.

       {¶37} Given the falsity, appellant’s commercial speech was not entitled to any

First Amendment protection claim, and he has failed to demonstrate the trial court erred

in granting summary judgment. His first assignment is without merit.

       {¶38} Under his next assignment, appellant states that the preliminary injunction

decision must be reversed because he was denied his constitutional due process rights

both before and during the December 5, 2016 hearing. First, he claims he was denied a

fair hearing because he was not served with the complaint until minutes before the start

of the preliminary injunction hearing. Second, he contends the trial court did not permit

him to testify on his own behalf during the proceeding.

       {¶39} When a preliminary injunction has been preempted by the issuance of a

permanent injunction, the substance of the preliminary injunction becomes moot. Great

Plains Exploration, LLC v. City of Willoughby, 11th Dist. Lake No. 2006-L-022, 2006-Ohio-

7009. ¶13; City of Columbiana v. J & J Car Wash, Inc., 7th Dist. Columbiana No. 04 CO

20, 2005-Ohio-1336, ¶21. To the extent that any errors were made as a part of the

preliminary injunction procedure, they did not affect appellant’s ability to respond to the

Cramers’ summary judgment motion and the dispositive issue therein. Accordingly, since

appellant was not prejudiced in the ultimate resolution of the case, his second assignment

lacks merit.

       {¶40} Under his final assignment, appellant asserts that, during the remainder of

the action after the issuance of the preliminary injunction, events occurred that resulted

in a violation of his due process rights. First, he claims that the documents attached to

the Cramers’ motion for summary judgment were not properly certified. But the record

                                            11
does not support his assertion. The majority of the documents relating to the stay issue

were certified by the clerk of the federal district court in the foreclosure proceeding. This

includes the final judgment in which the district court rejected appellant’s stay argument.

Even though the attached copy of appellant’s amended objections to the confirmation of

the sale was not certified, appellant attached a copy of his original set of objections to his

motion to strike the Cramers’ motion. That document verifies that appellant asserted the

stay issue before the district court before the foreclosure sale was confirmed.

       {¶41} Second, appellant contends that he was denied due process because the

trial court did not enjoin Fatica Renovations from selling to Cramers during the pendency

of the case. Appellant never requested that relief and, therefore, fails to demonstrate

error. See State ex rel. Gibbs v. Concord Twp. Trustees, 152 Ohio App.3d 387, 2003-

Ohio-1586, 787 N.E.2d 1248, ¶37 (11th Dist.)

       {¶42} Third, appellant states that a due process violation occurred when Fatica

Renovations’ trial counsel did not serve a copy of the complaint upon the Cramers when

they were substituted as plaintiffs. But, even if an error occurred, it was not prejudicial to

appellant.

       {¶43} Fourth, appellant argues that the trial court did not afford him minimal due

process by making a finding on the “automatic stay” issue before he had an opportunity

to file his answer. On August 7, 2017, as part of a decision on procedural motions filed

after this court’s dismissal of appellant’s first appeal, the trial court found that the federal

foreclosure sale was proper because Lisa did not file her bankruptcy petition prior to the

sale date. However, in subsequently entering summary judgment for the Cramers, the

court based its determination upon the legal conclusion that the federal district court’s

holding on the stay issue was binding precedent. Thus, the factual finding in the August

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7, 2017 decision was inconsequential to the final resolution of the case.

       {¶44} Fifth, appellant asserts that a due process violation occurred when the trial

court entered final judgment without holding a jury trial, as he requested in his answer.

Under Ohio law, though, the specific purpose of summary judgment is to determine if a

jury trial is needed to resolve a factual dispute. National City Real Estate Services LLC

v. Frazier, 2018-Ohio-982, 96 N.E.3d 311, ¶25 (4th Dist.). To the extent that there were

no genuine issues of material fact to try, appellant was not entitled to a jury trial.

       {¶45} Appellant was given a fair opportunity to respond to the summary judgment

motion. Appellant’s third assignment is, therefore, without merit.

       {¶46} The judgment of the Geauga County Court of Common Pleas is affirmed.

TIMOTHY P. CANNON, J., concurs,

COLLEEN MARY O’TOOLE, J., dissents.

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