Davis v. Galagaza

Erik Davis, Plaintiff, v. Joseph Galagaza, et al., Defendants.

Civil Action No. H-20-2349

United States District Court, S.D. Texas, Houston Division

June 23, 2021

MEMORANDUM AND RECOMMENDATION

PETER BRAY UNITED STATES MAGISTRATE JUDGE

Pending before the court is Defendants' motion to dismiss based on res judicata and collateral estoppel. (D.E. 23.) This motion is before the undersigned magistrate judge pursuant to 28 U.S.C. § 636(b)(1). For the reasons detailed below the court recommends that the motion to dismiss be GRANTED.

1. Background^[1]

In his operative pleading, Erik Davis alleges that Joseph Galagaza Jackson Lewis P.C.^[2] (Jackson Lewis), Protect Controls Incorporated (PCI), and PCI Flexible Spending Account Plan defrauded Davis in connection with the settlement of a 2009 lawsuit. (D.E. 28.) Defendants move to dismiss, asserting that all of Davis's claims were previously adjudicated and are now barred under res judicata and collateral estoppel. (D.E. 23.)

A. Previously Adjudicated Related Cases

i. Davis v. Protect Controls, No. 2009-76394 (11th Dist. Ct., Harris Cnty., Tex. Nov. 25, 2009).

In 2009, Davis sued his employer, PCI, for employment discrimination in Davis v. Protect Controls, No. 2009-76394 (11th Dist. Ct., Harris County, Tex. Nov. 25, 2009). Galagaza, a lawyer with Jackson Lewis, represented PCI. John Sekumade, with the Sekumade Law Firm, represented Davis. During the discovery process, the parties also discussed a flexible spending account reimbursement under the Employee Retirement Income Security Act (ERISA). (D.E. 23-4 at 44.) The case settled in 2010. Davis purportedly signed a settlement agreement that released PCI from future liability for discrimination and ERISA-related claims. Id. at 51-54.

ii. Davis v. Sekumade, No. 2011-16071 (295th Dist. Ct., Harris Cnty., Tex. Mar. 15, 2011).

In 2011, Davis sued his former lawyer, Sekumade, in Davis v. Sekumade, No. 2011-16071 (295th Dist. Ct., Harris Cnty., Tex. Mar. 15, 2011). Davis alleged that Sekumade settled the 2009 employment discrimination case without Davis's authorization and failed to remit the settlement funds to Davis. Davis asserted claims of negligence, breach of contract, breach of fiduciary duty, fraud, and violations of several Texas statutes. The state court awarded Davis over $1, 800, 000 by a default judgment. (D.E. 23-1.)

iii. Davis v. Galagaza, No. 2014-66506 (151st Dist. Ct., Harris Cnty., Tex. Nov. 13, 2014).

In 2014, Davis sued Galagaza, Jackson Lewis, and PCI in Devis v. Galagaza (Davis 2014), No. 2014-66506 (151st Dist. Ct., Harris Cnty., Tex. Nov. 13, 2014). Davis alleged that Galagaza, Jackson Lewis, and PCI knew that Sekumade settled the 2009 employment discrimination case without Davis's authorization and concealed documentation surrounding the transaction. Davis asserted claims of fraud, intentional infliction of emotional distress, aiding and abetting a breach of fiduciary duty, and civil conspiracy. (D.E. 23-2.) The state trial court granted summary judgment in favor of Defendants, adjudicating “all outstanding claims and parties.” Final Order, Davis 2014, 2016 WL 3996795, at *1 (Feb. 11, 2016). The state appellate court affirmed the trial court's judgment in April 2017. (D.E. 23-3.)

iv. Davis v. Galagaza, No. 2017-48122 (151st Dist. Ct., Harris Cnty., Tex. July 20, 2017) and Davis v. Protect Controls Inc. Flexible Acct. Plan, No. 4:17-cv-2677 (S.D. Tex. 2017).

In 2017, Davis again sued Galagaza, Jackson Lewis, PCI, and PCI Flexible Spending Account Plan in Davis v. Galagaza, No. 2017-48122 (151st Dist. Ct., Harris Cnty., Tex. July 20, 2017). Davis again alleged that Galagaza, Jackson Lewis, and PCI knew that Sekumade settled the 2009 employment discrimination case without Davis's authorization and concealed documentation surrounding the transaction. He also alleged that the settlement paperwork showed that Defendants fraudulently concealed reimbursable funds held in a flexible spending account. Davis asserted claims of misrepresentation, breach of contract, breach of fiduciary duties, and violations of ERISA. (D.E. 23-4.)

Defendants removed the 2017 case to federal court on September 5, 2017, relying on federal question jurisdiction. See Davis v. Protect Controls Inc. Flexible Acct. Plan (Davis 2017), No. 4:17-cv-2677 (S.D. Tex. 2017). In December 2017 the court held a pretrial conference and “[h]eard extensive explanation by Plaintiff about his claims.” Davis 2017, ECF No. 24. Davis amended his complaint^[3] and filed numerous motions and other documents. Judge Atlas granted Defendants' motion for summary judgment based on res judicata. (D.E. 23-5.)

Davis moved for a new trial, which the court denied. Memorandum and Order, Davis 2017, 2018 WL 3589087, at *1 (S.D. Tex. June 14, 2018). Defendants moved for sanctions. The court denied the motion but “caution[ed] [Davis] that he [would] be subject to sanctions if he refile[d] these claims, in state court or in federal court, in the future.” Id. at *3 n.l. On June 18, 2018, the United States Court of Appeals for the Fifth Circuit dismissed Davis's appeal for want of prosecution. (D.E. 23-6.) One month later, Davis moved to amend and reinstate the appeal, which the Fifth Circuit denied on April 18, 2019.

v. Davis v. Galagaza, No. 4:19-cv-3119 (S.D. Tex. Aug. 20, 2019).

On August 1, 2019, Davis filed a fifth amended petition in Davis 2014. Defendants filed a notice of removal on August 20, 2019, before the state court could decide if it would grant leave for Davis's fifth amended petition. Judge Atlas determined that the fifth amended petition was “not a cognizable pleading” and could not support removal jurisdiction. Davis v. Galagaza, No. CV H-19-3119, 2019 WL 4757457, at *2 (S.D. Tex. Sept. 30, 2019). The case was remanded for lack of subject matter jurisdiction. Id. at *3. On November 4, 2019, the state trial court denied Davis leave to file his fifth amended pleading in Davis 2014.

B. Current Case

On July 2, 2020, Davis again sued Galagaza, Jackson Lewis, PCI, PCI Flexible Spending Account Plan, Don Davis, Walter Davis, Sekumade, and Sekumade Law Firm. (D.E. 1.) Like his 2017 state court pleading, Davis's 2020 federal complaint alleges that Defendants knew that Sekumade settled the 2009 employment discrimination case without Davis's authorization, concealed documentation surrounding the transaction, and fraudulently concealed reimbursable funds held in a flexible spending account. Like the 2017 pleading, the 2020 complaint appears to allege claims of misrepresentation, breach of contract, breaches of fiduciary duty, and causes of action under ERISA. Id.

Between July and September 2020, Davis filed over ten motions, affidavits, and other pleadings with the court, many of which were duplicates of others. (D.E. 4; D.E. 5; D.E. 6; D.E. 8; D.E. 11; D.E. 12; D.E. 14; D.E. 16; D.E. 17; D.E. 18; D.E. 19; D.E. 20; D.E. 21.) On August 3, 2020, Davis filed a motion asking the court to permit him to serve summonses. (D.E. 4.) Two days later, the court denied Davis's motion but explained the process for service under Federal Rule of Civil Procedure 4 and directed him to the Southern District of Texas's pro se guide to litigation. (D.E. 9.) Despite not being properly served, on September 8, 2020, Galagaza and Jackson Lewis moved to dismiss Davis's complaint under Rule 12(b)(6) and the doctrines of res judicata and collateral estoppel. (D.E. 23.) They also asked the court to designate Davis as a vexatious litigant. Id. at 4.

On September 9, 2020, Davis and counsel for Galagaza and Jackson Lewis appeared before the court. (D.E. 24.) Galagaza and Jackson Lewis waived service of process and the court ordered Davis to serve the remaining Defendants by October 9, 2020. The court also addressed Defendants' motion to dismiss and asked Davis if he had previously filed the same claims asserted now against the same Defendants. Davis answered “yes and no.” He explained, on the record, that his previous complaint, dismissed with prejudice by Judge Atlas, did not raise the ERISA claims that his current suit raises. The court warned Davis that he could not cut and paste his pleadings from other cases and suggested that he reread the motion to dismiss to determine if a voluntary dismissal would be in his best interest. If Davis decided to move forward with his claims, the court limited his response to the motion to dismiss to twenty pages.

On September 22, 2020, Davis filed an amended pleading naming only PCI, PCI Flexible Spending Account Plan, Galagaza, and Jackson Lewis as Defendants. (D.E. 28.) The court ordered that the September 22 pleading be the operative pleading and that Defendants need not respond. (D.E. 30.) Davis also filed a 162-page response to the motion to dismiss. (D.E. 29.) In the first two paragraphs of the response, Davis asserts that the operative pleading does state a plausible claim for relief and that Defendants' defenses must be made before a responsive pleading. Id. at 1-2. The remaining pages include excerpts of federal statutes and the Constitution, a copy of a motion to dismiss that Defendants filed in Davis 2014, and a copy of the operative pleading. Id. at 2-162.

On October 6, 2020, PCI and PCI Flexible Spending Account Plan moved to join Galagaza and Jackson Lewis's motion to dismiss. (D.E. 32.) The court granted joinder and thus considers the motion to dismiss to apply to all Defendants listed in the operative pleading-PCI, PCI Flexible Spending Account Plan, Galagaza, and Jackson Lewis. (D.E. 37.)

2. Standard of Review

Federal Rule of Civil Procedure 12(b)(6) authorizes the court to dismiss a complaint for “failure to state a claim upon which relief can be granted.” To survive a motion to dismiss, the plaintiff must plead “enough facts to...