United States District Court, E.D. New York
OPINION & ORDER
ALLYNE R. ROSS, District Judge.
Plaintiff, Leonid Lautman, proceeding pro se, brings this action against his landlord cooperative, its board and officers, and its attorneys. Plaintiff asserts that defendants violated the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq., and New York state law when they instituted a nonpayment of rent proceeding against him in state court.
Defendants have moved to dismiss the action under Federal Rule of Civil Procedure 12(b)(6) and assert numerous grounds for dismissal of the complaint. For the reasons set forth below, the court finds that plaintiff's FDCPA claims against his landlord cooperative, its board, and its officers must be dismissed because they are creditors and not "debt collectors" within the meaning of the FDCPA. The court finds that plaintiff's FDCPA claims against his landlord's attorneys cannot be dismissed under the Rooker-Feldman doctrine or on res judicata grounds. However, all of plaintiff's FDCPA claims against the landlord's attorneys must nonetheless be dismissed on the grounds of collateral estoppel or for failure to state a claim. The court also declines to exercise supplemental jurisdiction over plaintiff's state law claims. Accordingly, defendants' motion is granted and the complaint is dismissed in its entirety.
The following facts are drawn from the complaint and from documents incorporated by reference in the complaint. The court will also take judicial notice of the filings and orders in the state court proceedings. See Ferrari v. Cnty. of Suffolk, 790 F.Supp.2d 34, 38 n.4 (E.D.N.Y. 2011) ("In the Rule 12(b)(6) context, a court may take judicial notice of prior pleadings, orders, judgments, and other related documents that appear in the court records of prior litigation and that relate to the case sub judice.").
Plaintiff resides in an apartment at 2800 Coyle Street, Brooklyn, New York. Compl., Dkt. #1, ¶ 4. Defendant 2800 Coyle Street Owners Corp. (the "Co-op") is a domestic cooperative housing corporation that owns the building at 2800 Coyle Street. Id. ¶ 6. Plaintiff owns shares of stock in the Co-op and leases his apartment from the Co-op subject to the terms and conditions of a proprietary lease. Id. ¶ 4. Defendant Board of Directors of 2800 Coyle Street Owners Corp. (the "Co-op Board") is the highest supervisory body in charge of all affairs of the Co-op, including the collection of rent and rent arrears. Id. ¶ 7. Defendants Svetlana Marmar and Alla Schvarts are tenants at 2800 Coyle Street and shareholders in the Co-op. Id. ¶¶ 8-9. Marmar is the President of the Co-op Board and Shvarts is the Vice-President of the Co-op Board. Id.
This is the second lawsuit before this court arising out of a landlord-tenant dispute between plaintiff and the Co-op. The court assumes familiarity with its opinion in the other suit and will restate only the essential facts here. In plaintiff's first suit, he named as defendants the Co-op, its officers, its managing agent, its managing agent's principals, and its former lawyers from the firm Norris McLaughlin & Marcus, P.A ("Norris McLaughlin"). Lautman v. 2800 Coyle St. Owners Corp., No. 13-CV-967 (ARR)(VVP), 2014 WL 2200909, at *1 (E.D.N.Y. May 23, 2014). Plaintiff alleged that the defendants had sent him bills between August 2011 and January 2013 that contained false and misleading information regarding the rent and rent arrears that he owed. Id. He asserted that the Co-op had not complied with registration requirements imposed by New York state law, and as a result the rents that he purportedly owed were "forfeited and unrecoverable." Id. On February 15, 2012, the Co-op, through its attorneys at Norris McLaughlin, instituted summary nonpayment proceedings against plaintiff in Kings County Housing Court. Id. at *2. Plaintiff asserted that the rent arrears asserted in the petition were "fabricated" and moved to dismiss the action. Id. On July 27, 2012, the Co-op voluntarily discontinued the Housing Court action without prejudice. Id. In the prior suit, plaintiff brought claims under the FCDPA and New York state law challenging the Co-op's attempts to collect rent from him and the institution of the Housing Court proceedings in 2012. Id.
The defendants in the prior lawsuit all moved for judgment on the pleadings under Rule 12(c). In an opinion and order on May 23, 2014, the court dismissed all FDCPA claims against the Co-op, its officers, and its managing agent because the court found that they were not "debt collectors" within the meaning of the statute. Id. at *3-*4. The court allowed the FDCPA claims against Norris McLaughlin and its attorneys to go forward. Id. at *5-*7. The court dismissed some of plaintiff's New York state law claims with prejudice and declined to exercise supplemental jurisdiction over the remaining state law claims. Id. at *7-* 10. On June 27, 2014, plaintiff filed a notice of interlocutory appeal of the court's opinion and order dismissing the majority of plaintiff's claims. See 13-CV-967, Dkt. #58.
Meanwhile, plaintiff filed this second lawsuit on March 21, 2014. In this action, plaintiff raises claims relating to the time period from March 5, 2013, to the present. Compl. ¶ 14. He challenges a second Housing Court action that the Co-op instituted against him on March 5, 2013. Id. ¶ 15. Plaintiff alleges that, in bringing the second Housing Court proceeding, defendants "attempted to illegally collect charges and arrears prohibited by law, and made false and misleading representations to the Court and plaintiff about the character, amount and legal status of the set forth therein charges and arrears." Id. ¶ 17.
Defendants Sauchik Law Group, P.C., and its attorneys Alec Sauchik, Esq., and Steve Polyakov, Esq., represented the Co-op in the second Housing Court proceeding at issue in this action and served plaintiff with the petition on March 21, 2013. Id. ¶¶ 15-16 & Ex. C. On March 22, 2013, plaintiff filed a "Notice of Rejection of the Verified Petition" claiming that the petition was fraudulent and contained improper past-due rent amounts. Decl. of Alec Sauchik ("Sauchik Decl."), Dkt. #13, Ex. 2, ¶ 10. The Housing Court deemed this notice to be plaintiff's answer and scheduled the matter for a court appearance. Id. At a hearing on June 14, 2013, the Housing Court dismissed plaintiff's allegations that the petition had not been served properly, finding that plaintiff's challenges related not to service but to "the sufficiency of the rent demand and verification of the petition." Sauchik Decl., Ex. D.
In August 2013, plaintiff filed a motion to dismiss the Housing Court action on the grounds of "illegality and fraud on the court" and for sanctions against defendant Sauchik. Sauchik Decl., Ex. F, ¶¶ 1-2. Plaintiff asserted that Sauchik fabricated the petition and included "fundamental misstatements and omissions" relating to, inter alia the amount of rent due, the service of prior rent demands on plaintiff, and the Co-op's compliance with state registration requirements. Id. ¶ 39. On August 29, 2013, the Housing Court denied plaintiffs motion as untimely, stating that the trial was scheduled to begin that day and that plaintiff had already had a hearing on the issue of improper service. Sauchik Decl., Ex. F, at 1.
The trial in Housing Court began on August 29, 2013, and was continued until September 16, 2013. When plaintiff did not appear at the second trial date on September 16, the Housing Court entered a default judgment against plaintiff, granting the Co-op possession of the apartment and $45, 955.75 in monetary damages. Sauchik Decl., Ex. G. Plaintiff asserts that he defaulted "due to his newly retained attorney arriving late in court." Compl. ¶ 25.
On October 24, 2013, plaintiff filed a motion in Housing Court to vacate the default judgment. Sauchik Decl., Ex. H, at 2. The Housing Court denied the motion on October 13, 2013, finding that plaintiff had not provided a reason for his failure to appear on the second trial date. Id. at 3. The court also found that plaintiff could not show "proof of a viable defense." Id. While plaintiff challenged the "sufficiency of the rent demand, " he had not specifically preserved that defense in his answer or provided facts to support the defense. Id. Through counsel, plaintiff served notices of appeal of the Housing Court's September 16, 2013 default judgment and its October 31, 2013 denial of his motion to vacate the default judgment. Sauchik Decl. ¶¶ 15-16.
On November 18, 2013, plaintiff brought a motion before the Appellate Term, Kings County, to stay enforcement of the default judgment pending the resolution of his appeal, which the court denied. Sauchik Decl., Exs. I & J. In February 2014, plaintiff brought another motion for a stay of the proceedings, this time in Housing Court. The Housing Court granted an interim stay pending appeal and ordered plaintiff to post a bond of $51, 180.75, pay his monthly maintenance fee to the Co-op, and perfect his appeal by April 4, 2014. Sauchik Decl. ¶ 19 & Ex. K. In an order dated May 30, 2014, the Housing Court granted the Co-op's motion to vacate the stay because plaintiff had not perfected his appeal by the April 4 deadline. Sauchik Decl., Ex. L, at 2. In July 2014, plaintiff filed another motion before the Appellate Term for a stay of the proceedings, and the motion is fully briefed and pending decision. Sauchik Decl. ¶ 23.
In this action, plaintiff asserts FDCPA claims against all of the defendants for making "false and misleading representations" and engaging in "unfair and abusive practices" in instituting and prosecuting the Housing Court action. Compl. ¶¶ 27, 30. He also asserts that the Co-op Board violated the FDCPA on April 23, 2013, when it published a list of tenant-shareholders who purportedly owed rent, including plaintiff, without his permission. Id. ¶¶ 19, 30 & Ex. D.
Plaintiff also asserts several state law claims. He asserts claims against all defendants under New York General Business Law § 349 for engaging in deceptive acts and practices in the conduct of their businesses. Id. ¶¶ 32-37. He asserts claims against Sauchik Law Group and its attorneys under New York Judiciary Law § 487 for engaging in deceit or collusion, including preparing "fraudulent, deceptive, and misleading affidavits and affirmations" and "[f]raudulently obtaining the default judgment against Plaintiff." Id. ¶¶ 38-44. He asserts a state law malicious prosecution claim against all defendants relating to the Housing Court proceeding. Id. ¶¶ 45-47. Finally, he asserts a state law libel claim against the Co-op, the Co-op Board, Marmer, and Shvarts relating to the publication of plaintiffs purported rent arrears. Id. ¶¶ 48-53.
Plaintiff alleges that, as a result of defendants' actions, he has suffered economic injury, including legal costs, and non-economic injuries, including "continuing severe emotional distress" and "mental anguish caused by his receipt of multiple improper eviction notices and impending loss of his home and his investment." Id. ¶ 28. He seeks compensatory damages, punitive and treble damages, attorney's fees, and costs.
On August 18, 2014, defendants requested the court's leave to file a motion to dismiss the complaint under Rule 12(b)(6). Dkt. #9. The court granted defendants permission to bring the motion and set a briefing schedule. Dkt. #11. Pursuant to that briefing schedule, defendants served plaintiff with the motion to dismiss and supporting papers on August 27, 2014. Dkt. #12. According to the briefing schedule, plaintiff had until September 5, 2014, to file his opposition to defendants' motion. As of this date, plaintiff has not filed any opposition. Defendants filed the motion papers with the court on September 9, 2014. Dkt. #13. Since plaintiff was given notice of the motion and the opportunity to file an opposition, and plaintiff has not filed any response or contacted the court to request an extension of time, the court will proceed to decide the pending motion on the record before it.
I. Standard of Review
To survive a motion to dismiss under Rule 12(b)(6), a complaint must plead "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). The court must accept all factual allegations in the complaint as true and draw all reasonable inferences in favor of the plaintiff. Twombly, 550 U.S. at 555-56; Freedom Holdings, Inc. v. Spitzer, 363 F.3d 149, 151 (2d Cir. 2004). Courts are "not bound to accept as true a legal conclusion couched as a factual allegation, " and "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). However, it is well settled that pro se complaints are held to less stringent standards than pleadings drafted by attorneys, and the court is required to construe a plaintiff's pro ...