Court Opinion

ID: 4521564
Source: CourtListenerOpinion
Date Created: 2020-04-02 00:00:56.938199+00
Date Added: 2024-06-11T09:24:23.761296
License: Public Domain

Case: 19-30494          Document: 00515368435        Page: 1   Date Filed: 04/01/2020

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT
                                          United States Court of Appeals
                                                   Fifth Circuit

                                                                            FILED
                                                                          April 1, 2020
                                            No. 19-30494                 Lyle W. Cayce
                                                                              Clerk

In the Matter of: DONALD H. GRODSKY

                Debtor

JOHN T. LAMARTINA-HOWELL; ELISE LAMARTINA,

                 Appellants

v.

DAVID ADLER; GORDON, ARATA, MONTGOMERY, BARNETT,
MCCOLLAM, DUPLANTIS & EAGAN, L.L.C., formerly known as Gordon,
Arata, McCollam, Duplantis and Eagan, L.L.C.; FERNAND L. LAUDUMIEY,
IV; DAVID J. MESSINA; LAKE VILLAS NUMBER 2 HOMEOWNERS
ASSOCIATION, INCORPORATED; SEALE & ROSS, A PROFESSIONAL
LAW CORPORATION; GLEN GALBRAITH; LESLIE BOLNER,

                 Appellees

-------------------------------------------------------

Consolidated with 19-30496

In the Matter of: DONALD H. GRODSKY

                 Debtor

JOHN L. HOWELL; ELISE LAMARTINA,

                 Appellants

v.
     Case: 19-30494      Document: 00515368435         Page: 2    Date Filed: 04/01/2020

                                      No. 19-30494
LAKE VILLAS NUMBER 2 HOMEOWNERS ASSOCIATION,
INCORPORATED; DAVID V. ADLER; GORDON, ARATA, MCCOLLAM,
DUPLANTIS AND EAGAN, L.L.C.; CHAFFE MCCALL, L.L.P.; FERNAND
L. LAUDUMIEY, IV; DAVID J. MESSINA; SEALE & ROSS, A
PROFESSIONAL LAW CORPORATION; GLEN GALBRAITH; LESLIE
BOLNER,

              Appellees

                  Appeals from the United States District Court
                      for the Eastern District of Louisiana
                            USDC No. 2:19-CV-10068
                            USDC No. 2:19-CV-10334

Before DAVIS, JONES, and ENGELHARDT, Circuit Judges.
PER CURIAM:*
       Appellants John LaMartina-Howell (“John”) and Elise LaMartina
(“Elise”) appeal the district court’s affirmance of two bankruptcy court orders
dismissing all claims related to the ownership of a promissory note and
enjoining all future claims regarding the same. We affirm.
                                             I.
       This consolidated appeal relates to a dispute that has been litigated in
state, bankruptcy, and district courts for the last six years. This appeal should,
at long last, be the end of the road. In 2014, Defendant-Appellee, Lake Villas
II Homeowners Association (“Lake Villas”), obtained a judgment in Louisiana
state court for $37,147.68 against Elise for her failure to pay her homeowners

       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.

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     Case: 19-30494       Document: 00515368435          Page: 3     Date Filed: 04/01/2020

                                       No. 19-30494
association fees. When Lake Villas attempted to foreclose on her condo to
satisfy the judgment, a second, higher-priority mortgage was discovered. The
ownership of that note sparked great controversy.                         Donald Grodsky
(“Grodsky”), whose bankruptcy trustee is a Defendant-Appellee here, claimed
ownership, as did Elise’s son John.
       During Lake Villas’ suit against Elise, the Louisiana court determined,
after hearing extensive and shifting testimony from the LaMartina family and
Grodsky, that the note was the property of Grodsky.1 Grodsky’s closed 2009
Chapter 7 bankruptcy case was then re-opened “to administer and distribute
the proceeds of the Mortgage Note” because he had failed to disclose the
mortgage note during those initial bankruptcy proceedings. To that end, in
May 2015, the bankruptcy court ordered John to turn over the mortgage note.
This order was not appealed.
       John and Elise did, however, file a separate adversary proceeding in
bankruptcy court on January 29, 2018. Their complaint alleged that during
the proceedings before the Louisiana court, Appellees committed bribery,
witness tampering, fraud, and extortion, among many other crimes,2 as well as
defamation, breach of fiduciary duty, and abuse of process. Also named as a

       1   The Louisiana First Circuit court of appeal dismissed John’s appeal, and the
Louisiana Supreme Court denied further review. Lake Villas No. II Homeowners’ Ass’n, Inc.
v. LaMartina, 189 So. 3d 1070 (La. 2016). Later writ applications were also denied. See, e.g.,
Lake Villas No. II Homeowners Ass’n, Inc. v. Lamartina, 2018-0699 (La. App. 1 Cir. 9/17/18).
        2 In August 2016, John filed a RICO complaint in the district court against the trustee,

Lake Villas, and their attorneys. Howell v. Adler, No. 16-14141, 2017 WL 1064974 (E.D. La.
Mar. 21, 2017). The court dismissed these claims, holding that the Barton doctrine precluded
Elise and John from filing claims based on defendants’ “acts performed ‘within the context of
[their] role of recovering assets for the estate’” without receiving permission from the
bankruptcy court. Id. at *2-3 (internal citations omitted). The court also found that John
failed to plead adequate facts to state a RICO claim. Id. at*3-6. This judgment was not
appealed, and to the extent Appellants attempt to revive their RICO complaint, such a claim
is barred by res judicata. Southmark Corp. v. Coopers & Lybrand (In re Southmark Corp.),
163 F.3d 925, 934 (5th Cir. 1999) (Res judicata “bars the litigation of claims that either have
been litigated or should have been raised in an earlier suit.”).
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                                  No. 19-30494
defendant in this suit was the Office of the U.S. Trustee, who Appellants
contend failed to respond to complaints made about the Chapter 7 Trustee and
his attorneys. As relief, Appellants sought “the return of [the] Promissory
Note.” In addition to dismissing all of John and Elise’s claims, the bankruptcy
court granted Appellees’ requested Barton injunction, prohibiting all future
claims related to the ownership of the note. The district court affirmed, and
John and Elise filed their notice of appeal with this court.
      Despite the injunction, John and Elise filed anew in the Eastern District
of Louisiana. The complaint was styled as a petition for nullity, damages, and
permanent injunctive relief. Here, Appellants complained that “defendant
Lake Villas… violated the automatic stay in pursuing the state court litigation,
and therefore the state court judgment awarding ownership of the note to the
debtor is void ab initio.”   The district court transferred this case to the
bankruptcy court, which dismissed their claim. The district court affirmed,
and John and Elise appealed this decision, as well. The two appeals were
consolidated before this court.
                                       II.
      “When a court of appeals reviews the decision of a district court, sitting
as an appellate court, it applies the same standards of review to the bankruptcy
court’s finding of fact and conclusions of law as applied by the district court.”
Jacobsen v. Moser (In re Jacobsen), 609 F.3d 647, 652 (5th Cir. 2010) (citation
and internal quotation marks omitted). Thus, in accordance with the district
court, “conclusions of law are reviewed de novo, findings of fact are reviewed
for clear error, and mixed questions of fact and law are reviewed de novo.” In
re Nat’l Gypsum Co., 208 F.3d 498, 504 (5th Cir. 2000). We review the issuance
of injunctions for an abuse of discretion. See Doran v. Salem Inn, Inc., 422 U.S.
922, 931―32 (1975).

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                                 No. 19-30494

                                      III.
      On appeal, Appellants present ― with few citations to the record ― a
myriad of arguments, but ultimately to no avail. First, we agree with the
bankruptcy court that its “order directing [John] to turn the note over to the
bankruptcy trustee… became a final order when the motion to reconsider was
denied and no appeal was taken.” Thus, Appellants’ attempt to undo the
turnover order in these separate proceedings is barred by principles of res
judicata. Maggio v. Zeitz, 333 U.S. 56, 68 (1948) (“the turnover proceeding is
a separate one and, when completed and terminated in a final order, it
becomes res judicata and not subject to collateral attack”).
      Second, as to the remaining allegations against Grodksy’s bankruptcy
trustee and his attorneys, we also agree that Appellees are immune from
liability because they “acted within the scope of their duties during the events
described in the complaint, and that the plaintiffs’ allegations are not based in
fact.” C.f., Matter of Ondova Ltd. Co., 914 F.3d 990, 993 (5th Cir. 2019) (per
curiam). And, in light of the extensive litigation, the bankruptcy court was well
within its discretion to maintain jurisdiction over the adversary proceedings.
See Matter of Querner, 7 F.3d 1199, 1202 (5th Cir. 1993); Matter of Carroll, 850
F.3d 811, 816 (5th Cir. 2017) (per curiam). Finally, although Appellants
scarcely defend their second appeal in the briefs, we find that the bankruptcy
court was correct in holding that the suit violated its permanent injunction
barring John and Elise from relitigating the promissory note and that it lacked
any underlying merit.
                                      IV.
      Because we find no reversible error in the bankruptcy court’s orders, the
district courts’ judgments are AFFIRMED in all respects.

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