Court Opinion

ID: 873694
Source: CourtListenerOpinion
Date Created: 2013-06-03 18:54:48.155627+00
Date Added: 2024-06-11T09:07:03.482389
License: Public Domain

UNPUBLISHED

                   UNITED STATES COURT OF APPEALS
                       FOR THE FOURTH CIRCUIT

                               No. 12-1805

MICHAEL FIELD, JR.,

                 Plaintiff – Appellant,

           v.

MICHAEL BERMAN; WAYNE LEE; FRED MALEK; JOHN MORITZ; THOMAS
A. WOODLEY; THOMAS J. WOODLEY,

                 Defendants – Appellees,

           and

ERIC JOWETT; SUSAN MCFARLANE, personal representative of
the estate of Willis McFarlane, deceased; JAMES WILKINSON,

                 Defendants.

Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria.    Claude M. Hilton, Senior
District Judge. (1:12-cv-00130-CMH-TCB)

Argued:   March 21, 2013                     Decided:   June 3, 2013

Before GREGORY and THACKER, Circuit Judges, and HAMILTON, Senior
Circuit Judge.

Affirmed by unpublished per curiam opinion.

ARGUED: William Ryan Snow, CRENSHAW, WARE & MARTIN, PLC,
Norfolk, Virginia, for Appellant. Jeffrey Warren Harab, Chevy
Chase, Maryland, for Appellees.    ON BRIEF: Alyssa Carducci
Embree, CRENSHAW, WARE & MARTIN, PLC, Norfolk, Virginia, for
Appellant.

Unpublished opinions are not binding precedent in this circuit.

                              - 2 -
PER CURIAM:

       Appellant    Michael        Field,    Jr.    (Field)     appeals    from      the

district court’s dismissal of his complaint in the present civil

action seeking declaratory and injunctive relief.                  We affirm.

                                            I.

       Count I of Field’s complaint in the present civil action

seeks a declaration that, pursuant to a March 28, 2005 order of

sale   entered     by   the   United       States    Bankruptcy    Court       for   the

Eastern District of Virginia in In re: AutoMall Online, Inc.,

Case No. 05-10036 (the Bankruptcy Court’s Order of Sale), he

purchased and exclusively owns all claims that were or could

have   been   at    issue     in    the     case    captioned    Baker    v.    Field,

CL05001284;   CH04001230,          filed    and    adjudicated    in     the   Circuit

Court for the City of Alexandria, Virginia (the Virginia State

Court Case), and were reduced to the final judgment entered in

such case on March 17, 2006, in the amount of $1,432,581.00 (the

Money Judgment).

       Count II of Field’s complaint seeks a declaration that all

efforts by Appellees Michael Berman, Wayne Lee, Fred Malek, John

Moritz, Thomas A. Woodley, and Thomas J. Woodley (Appellees),

and any of their respective successors or assigns, “to enforce

any judgment obtained on any of the claims at issue in the

                                          - 3 -
[Virginia] State Court Case are void and of no effect.”                  (J.A.

18).

       Count III of Field’s complaint seeks to enjoin Appellees

from engaging in any action to enforce the Money Judgment.

       Count IV seeks a declaration that the acts of Appellees in

obtaining dismissal in the Virginia State Court Case of Field

and codefendant Field Auto City, Inc.’s counterclaims for breach

of fiduciary duty, theft of trade secrets, unjust enrichment,

and forgery, as alleged in Field and Field Auto City, Inc.’s

pleading filed on February 5, 2005 (the Counterclaims), are void

and of no effect.

       Count V seeks a declaration that the acts of Appellees in

obtaining      dismissal    of   the     Counterclaims    and    in   settling

derivative claims on behalf of AutoMall Online, Inc. against

Allen Outlaw, another codefendant in the Virginia State Court

Case, violated the automatic stay in In re: AutoMall Online,

Inc., Case No. 05-10036.

       Count   VI   alternatively      seeks   a   declaration   that,   under

Virginia law, Appellees’ settlement with Allen Outlaw reduces

the Money Judgment to zero.

       On   Appellees’     motion,   the   district    court    dismissed   all

counts in Field’s complaint in the present action for lack of

subject matter jurisdiction based upon its application of the

                                       - 4 -
Rooker-Feldman doctrine. 1           Fed. R. Civ. Proc. 12(b)(1).                 In the

alternative, the district court dismissed Counts I through V for

failure to state a claim upon which relief can be granted based

upon the doctrine of res judicata.                     Fed. R. Civ. P. 12(b)(6).

Field     noted   this      timely    appeal      in   which    he    challenges     the

district court’s dismissal of all counts.

      For reasons that follow, we affirm the dismissal of Counts

I,   IV,   and    V   pursuant       to   Federal      Rule    of    Civil   Procedure

12(b)(6) (Rule 12(b)(6)), the dismissal of Counts II and III

pursuant    to    Federal     Rule    of    Civil      Procedure      12(b)(1)     (Rule

12(b)(1)), and the dismissal of Count VI pursuant to 28 U.S.C.

§ 1367(c)(3).

                                           II.

      We   review     the    Rule    12(b)(6)      dismissal     of   a   claim    in   a

complaint for “failure to state a claim upon which relief can be

granted,” Fed. R. Civ. P. 12(b)(6), de novo, “focus[ing] only on

the legal sufficiency of the complaint,” Giarratano v. Johnson,

521 F.3d 298, 302 (4th Cir. 2008), and “accepting as true the

well-pled facts in the complaint and viewing them in the light

      1
       The doctrine derives its name from the following two
Supreme Court cases:  District of Columbia Court of Appeals v.
Feldman, 460 U.S. 462 (1983), and Rooker v. Fidelity Trust Co.,
263 U.S. 413 (1923).

                                          - 5 -
most favorable to the plaintiff,” Brockington v. Boykins, 637

F.3d 503, 505 (4th Cir. 2011).                  In addition to considering the

complaint itself, we must consider any documents attached to the

complaint     as     exhibits,      Fed.   R.        Civ.   P.    10(c),    “documents

incorporated into the complaint by reference, and matters of

which a court may take judicial notice,” Tellabs, Inc. v. Makor

Issues & Rights, Ltd., 551 U.S. 308, 322 (2007).

      To   survive     a    Rule    12(b)(6)      motion,        the   complaint    must

contain    “enough     facts       to   state    a    claim      to    relief    that   is

plausible on its face.”             Bell Atlantic Corporation v. Twombly,

550   U.S.    544,    570    (2007).        That       is   to    say,     the   factual

allegations must “be enough to raise a right to relief above the

speculative level,” id. at 555, “permit[ting] the court to infer

more than the mere possibility of misconduct” based upon “its

judicial experience and common sense,” Ashcroft v. Iqbal, 556

U.S. 662, 679 (2009).

      Based upon our de novo review, we affirm the dismissal of

Counts I, IV, and V pursuant to Rule 12(b)(6).

      A.    Counts I and IV.

      The district court properly concluded that, at the Rule

12(b)(6) stage, the doctrine of res judicata precludes Counts I

and IV.      Title 28, United States Code, § 1738, commonly known in

jurisprudence as the full faith and credit statute, “requires

federal courts to give the same preclusive effect to state court

                                         - 6 -
judgments that those judgments would be given in the court of

the State from which the judgments emerged.”                      Kremer v. Chemical

Constr.    Corp.,       456   U.S.    461,   466     (1982);      accord     Marrese      v.

American    Academy      of   Orthopaedic        Surgeons,       470    U.S.      373,   380

(1985); Genesys Data Techs., Inc. v. Genesys Pacific Techs.,

Inc., 204 F.3d 124, 127 (4th Cir. 2000).                         Therefore, the full

faith    and    credit    statute      “does     not     allow    federal      courts     to

employ their own rules of res judicata in determining the effect

of state judgments.           Rather, it goes beyond the common law and

commands a federal court to accept the rules chosen by the State

from which the judgment is taken.”                 Kremer, 456 U.S. at 481-82.

               1. Count I.

     Count I of Field’s complaint in the present action seeks a

declaration that, pursuant to the Bankruptcy Court’s Order of

Sale, he purchased and exclusively owns all claims that were or

could    have    been    at   issue    in    the    Virginia      State      Court   Case,

including the one resulting in the Money Judgment.                                 In this

count,    Field    in    effect      seeks   a     declaration      that     he—not      the

Appellees—owns the Money Judgment.                      Critical to our review of

Count    I’s    Rule    12(b)(6)      dismissal         is   Exhibit    14   to    Field’s

complaint in the present action.                   Exhibit 14 is a court order

entitled    “ORDER      VACATING      RELEASE      OF    JUDGMENT      AND   REINSTATING

JUDGMENT,” entered in the Virginia State Court Case on September

28, 2011, in which the court squarely decides that Field was not

                                        - 7 -
the holder of the underlying claim reduced to the Money Judgment

and is not the owner of such judgment.             (J.A. 145).

       Under      applicable     Virginia        rules     of     res      judicata,

“relitigation of the same cause of action, or any part thereof,

which could have been litigated between the same parties and

their privies” is precluded.            Davis v. Mashall Homes, Inc., 576

S.E.2d 504, 506 (Va. 2003) (internal quotation marks omitted).

In Count I, Field seeks to re-litigate his claim of ownership of

the    claim   underlying      the     Money    Judgment    and    his     claim    of

ownership of the Money Judgment itself.                    The doctrine of res

judicata    under    Virginia    law    prevents    such    re-litigation,         and

therefore, Count I does not contain “enough facts to state a

claim to relief that is plausible on its face.”                         Twombly, 550

U.S. at 570.

       Moreover, we reject Field’s contention that the district

court erred in dismissing Count I based upon the doctrine of res

judicata without the defense of res judicata appearing on the

face   of   his    complaint    and    without    permitting      him    to   conduct

discovery or present evidence to address the defense.                          As we

have    explained,     the     facts    implicating      the    defense       of   res

judicata appear on the face of Field’s complaint and Exhibit 14

to such complaint.           Accordingly, the district court properly

addressed the defense at the Rule 12(b)(6) stage.

                                        - 8 -
     For the reasons stated, we hold the district court properly

dismissed Count I pursuant to Rule 12(b)(6), and we affirm on

this basis. 2

            2.    Count IV.

     Count IV asks the district court to declare that the acts

of   Appellees    in    seeking   and     obtaining   dismissal    of     the

Counterclaims for lack of standing are void and of no effect in

light of the Bankruptcy Court’s Order of Sale.           The doctrine of

res judicata under Virginia law precludes this count as well.

     Exhibit 9 to Field’s complaint in the present action is an

order in the Virginia State Court Case in which the Virginia

state court dismissed the Counterclaims for lack of standing on

Appellees’ motion to dismiss.           When this exhibit is considered

in conjunction with Exhibits 4 and 8 to Field’s complaint in the

present action, the undeniable conclusion is that the Virginia

state    court   did   not   dismiss   the   Counterclaims   for   lack    of

standing in the sense that Field now claims.             Exhibit 8 shows

that Appellees had argued that because the Counterclaims alleged

injury to AutoMall Online, Inc. and not to Field or Field Auto

City, Inc. individually, Field and Field Auto City, Inc. could

not maintain them individually as direct claims, which Exhibit 4

     2
       Given this disposition, we need not and do not reach the
district court’s alternative basis for dismissing Count I under
the Rooker-Feldman doctrine.

                                   - 9 -
to Field’s complaint in the present action shows is how Field

and Field Auto City, Inc. had pled them.                  Moreover, Field failed

to     mount   an   appellate      challenge       to   the     dismissal     of   the

Counterclaims when he had the opportunity to do so.                           In sum,

Count IV of Field’s complaint in the present action does nothing

more    than    seek      to    re-litigate       the   Virginia     state    court’s

dismissal of the Counterclaims.                   Considering the face of the

complaint      in   the    present      action    and   its   attached       exhibits,

applicable Virginia rules of res judicata preclude such action.

Davis, 576 S.E.2d at 506.

       Moreover, we reject Field’s contention that the district

court erred in dismissing Count IV based upon the doctrine of

res judicata without the defense of res judicata appearing on

the face of his complaint and without permitting him to conduct

discovery or present evidence to address the defense.                           As we

have     explained,       the   facts    implicating      the      defense    of   res

judicata appear on the face of Field’s complaint and Exhibits 4,

8, and 9 to such complaint.                 Accordingly, the district court

properly addressed the defense at the Rule 12(b)(6) stage.

                                         - 10 -
       For the reasons stated, we hold the district court properly

dismissed Count IV pursuant to Rule 12(b)(6), and we affirm on

this basis. 3

       B.        Count V.

       The portion of Count V seeking a declaration that the acts

of     Appellees        in         obtaining      dismissal     of    the    Counterclaims

violated the automatic stay in In re: AutoMall Online, Inc.,

Case No. 05-10036, fails to state a claim upon which relief can

be granted, and therefore, Rule 12(b)(6) required its dismissal.

Thorough         review       of    the   complaint       and   the    exhibits      attached

thereto show, on their face, that Appellees’ actions in seeking

dismissal of the Counterclaims did not violate the automatic

stay       in    In    re:     AutoMall         Online,    Inc.,     Case    No.    05-10036.

Accordingly,           we     affirm      the    Rule     12(b)(6)    dismissal      of     the

portion         of    Count    V     seeking      a   declaration     that    the    acts    of

Appellees in obtaining dismissal of the Counterclaims violated

the automatic stay in In re: AutoMall Online, Inc., Case No. 05-

10036.

       The portion of Count V, in which Field seeks a declaration

that settlement of their derivative claims on behalf of AutoMall

Online, Inc. against Allen Outlaw violated the automatic stay,

       3
       Given this disposition, we need not and do not reach the
district court’s alternative basis for dismissing Count IV under
the Rooker-Feldman doctrine.

                                                - 11 -
also fails to state a claim upon which relief can be granted.

See Fed. R. Civ. P. 12(b)(6).                    The actions taken by Appellees in

settling (or purporting to settle) derivative claims on behalf

of AutoMall Online, Inc. against Allen Outlaw took place prior

to AutoMall Online, Inc. filing for bankruptcy and any actions

taken after that time relating to settling with Allen Outlaw

took place after Field had purchased the derivative claims in

bankruptcy from the bankruptcy estate, thus making such claims

no   longer      subject         to    the    automatic       stay.          See    11       U.S.C.

§ 362(c)(1) (“the stay of an act against property of the estate

under     subsection         (a)      of    this    section    continues           until      such

property      is      no     longer        property    of     the     estate        .    .    .”).

Accordingly,          we    affirm      the     Rule   12(b)(6)         dismissal        of    the

portion    of      Count     V   in     which      Field   seeks    a    declaration          that

settlement      of     their       derivative       claims    on    behalf         of   AutoMall

Online, Inc. against Allen Outlaw violated the automatic stay. 4

                                                III.

     We    review          the   Rule      12(b)(1)    dismissal        of   a     claim      in   a

complaint       for    lack      of     subject      matter    jurisdiction             de   novo.

     4
        Having affirmed the district court’s Rule 12(b)(6)
dismissal of Count V, we need not and do not reach the district
court’s alternative basis for dismissing Count V under the
Rooker-Feldman doctrine.

                                              - 12 -
Pitt Cnty. v. Hotels.com, L.P., 553 F.3d 308, 311 (4th Cir.

2009).       Any   claim    barred      by    the     Rooker-Feldman       doctrine    is

“properly      dismissed    for    want      of   subject-matter         jurisdiction.”

Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284

(2005).      “The Rooker-Feldman doctrine . . . is confined to cases

. . . brought       by    state-court         losers      complaining     of    injuries

caused    by    state-court    judgments          rendered    before      the   district

court proceedings commenced and inviting district court review

and rejection of those judgments.”                  Id.     Notably, in the context

of the Rooker-Feldman doctrine, the term “state-court judgments”

is used in its broadest sense to include all final decisions of

state judicial proceedings.              See Feldman, 460 U.S. at 482 (“the

form of the proceeding is not significant”; rather, “[i]t is the

nature    and    effect    which   is     controlling”)        (internal        quotation

marks omitted); Doe v. Florida Bar, 630 F.3d 1336, 1340-41 (11th

Cir. 2011) (Rooker-Feldman doctrine barred federal court action

asserting as-applied due process challenge to Florida bar rules

requiring       confidential      peer       review    as    part   of    process     for

recertification as specialist with Florida state bar; plaintiff

had appealed through available state channels provided by state

bar rules, arguing due process challenge on the merits along the

way,   and      Florida    Supreme      Court       issued    brief    order     denying

petition for review).

                                         - 13 -
      Based      upon       our    de    novo      review,     we     affirm      the    district

court’s Rule 12(b)(1) dismissal of Counts II and III for lack of

subject matter jurisdiction under the Rooker-Feldman doctrine.

Without a doubt, the district court could not have adjudicated

Counts II and III in the present action without also reviewing

the   propriety        of    the    Supreme        Court      of     Virginia’s         denial    of

Field’s    petition          for    review         of   the    final        judgment      entered

against him in the Virginia State Court Case on March 17, 2006,

and reviewing the Supreme Court of Virginia’s denial of Field’s

motion    to   vacate        such       judgment.          Thus,      Field’s      position       on

appeal that he does not seek to overturn any final decision of a

state    court    in     Counts         II   and    III;      but    rather      only     seeks    a

declaration       that       he    owns      the    final     judgment       entered       in    the

Virginia State Court Case on March 17, 2006, is spurious.

      Furthermore, we reject Field’s contention that the district

court    erred    in     dismissing          Counts     II     and    III       based    upon    the

Rooker-Feldman           doctrine            without,         as      he         alleges,        the

applicability of Rooker-Feldman appearing on the face of his

complaint and without permitting him to conduct discovery or

present evidence at an evidentiary hearing.                             The district court

properly    resolved         the    jurisdictional            issues       on    the    extensive

record before it, which included, inter alia, Field’s complaint,

fourteen exhibits attached thereto, and other relevant documents

from the parties’ long litigation history.                              Field has made no

                                              - 14 -
showing   that   he   was   prejudiced     by   his   inability    to   conduct

discovery or have an evidentiary hearing before the district

court dismissed Counts II and III.              Accordingly, the district

court properly addressed the applicability of the Rooker-Feldman

doctrine at the Rule 12(b)(1) stage.

     For the reasons stated, we affirm the district court’s Rule

12(b)(1) dismissal of Counts II and III for lack of subject

matter jurisdiction under the Rooker-Feldman doctrine. 5

                                    IV.

     Because Count VI alleges a state law claim and all of the

claims over which the district court had original jurisdiction

were properly dismissed, we affirm dismissal of Count VI on the

basis of 28 U.S.C. § 1367(c)(3).            See id. (district court may

decline   to   exercise     supplemental    jurisdiction    over    state   law

claim when district court has dismissed all other claims over

which it had original jurisdiction).

     5
        Having affirmed the district court’s Rule 12(b)(1)
dismissal of Counts II and III, we need not and do not reach the
district court’s alternative basis for dismissing these counts
based upon the doctrine of res judicata.

                                   - 15 -
                               V.

     In conclusion, we affirm the district court’s dismissal of

all counts in the present action in toto.

                                                       AFFIRMED

                             - 16 -