Rajfa Saric v. Dart

1

Rajfa Saric, et al., Plaintiffs, v. Thomas Dart, et al., Defendants.

No. 23 C 2031

United States District Court, N.D. Illinois, Eastern Division

February 16, 2024

MEMORANDUM OPINION AND ORDER

HON JORGE ALONSO, UNITED STATES DISTRICT JUDGE

Plaintiffs bring various claims against several defendants after being evicted from property they lawfully purchased. Three of those defendants have filed motions to dismiss Plaintiffs' claims against them. As explained below, the Court grants the motion to dismiss filed by Defendant Wirbicki Law Group, LLC (“Wirbicki”) and grants in part and denies in part the motion to dismiss filed by Defendants Bank of New York Mellon (“BONY”) and Carrington Mortgage Services, LLC (“Carrington”).

Background^[1]

Several years ago, certain property in Franklin Park, IL (the “Subject Property”) was at issue in a foreclosure action in the Circuit Court of Cook County filed by Defendant BONY against Fikret Veljacic. (Compl. ¶ 23, ECF No. 1.) In September 2017, a judicial sale was held in which BONY was the highest bidder for the Subject Property. (Id. ¶ 24.) The sale was approved in January 2018. (Id.) Mr. Veljacic appealed the judgment in the foreclosure action and unsuccessfully moved to stay enforcement of the judgment. (Id. ¶¶ 25-27.) In June 2018, BONY, through its servicing agent Carrington, sold the Subject Property to Plaintiffs and conveyed title to it by a special warranty deed that was recorded in July 2018. (Id. ¶ 28.) The special warranty deed provided that BONY would defend Plaintiffs' title to the Subject Property “against the lawful claims of all persons whomsoever,” ^[2] and warranted that the Subject Property “is free of all encumbrances.” (ECF No. 1-4 at 2.) Plaintiffs have occupied the Subject Property as their principal residence since then. (Compl. ¶ 29.)

In March 2019, the appellate court reversed the trial court's judgment and confirmation of sale and remanded the foreclosure action for further proceedings. (Id. ¶ 30.) In June 2021, the trial court again entered a foreclosure judgment in BONY's favor. (Id. ¶ 31.) In January 2022, a second judicial sale of the Subject Property took place, and this time it was sold to Defendant Carmen Lupera even though Plaintiffs had previously bought the property from BONY; Lupera later received a judicial sale deed that was recorded with the Cook County Clerk. (Id. ¶¶ 32, 34.) In February 2022 the trial court approved the sale and ordered the Cook County Sheriff to evict Mr. Veljacic from the Subject Property. (Id. ¶ 33.)

In May 2022, Cook County Sheriff Deputy Defendants Romero Villasenor, Munoz, and Marin showed up at the Subject Property, broke down the door, turned over possession to Lupera, and evicted Plaintiffs. (Id. ¶ 35.) Plaintiffs had not been notified of any of the developments in the foreclosure action from June 2018 until then, had not been named in the sale documents for the second judicial sale or in the eviction petition, and had not received a demand for possession. (Id. ¶¶ 36-37.)

Following their eviction, Plaintiffs filed a petition under 735 ILCS 5/2-1401 (the “section 2-1401 petition”) in the foreclosure action, seeking to vacate the foreclosure judgment, judicial sale, and order confirming sale, and seeking possession of and title to the Subject Property. (See ECF No. 19-1 at 19-24 of 28.)^[3] Plaintiffs had also filed a petition to intervene in the foreclosure action, which the court found was moot in light of Plaintiffs' section 2-1401 petition. (See id. at 28.) In June 2022, the Circuit Court of Cook County entered a temporary restraining order reinstating Plaintiffs' possession of the Subject Property, and it later vacated the order approving the second sale of the property and voided the deed to Lupera. (Compl. ¶¶ 38-39.)

Plaintiffs then sued Defendants in this Court. Most relevantly, Plaintiffs claim that Defendants BONY and Carrington breached the special warranty deed (Count III) and violated the Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”), 815 ILCS 505/2 (Count IV), by failing to obtain dismissal of the foreclosure action given Plaintiffs' purchase of the Subject Property, failing to inform Plaintiffs that the foreclosure orders were appealed and later vacated, and pursuing and allowing the second judicial sale of the Subject Property. (See Id. ¶¶ 68-87.) They initially also brought claims of conversion, trespass, and trespass to chattels against BONY and Carrington and other Defendants (Counts V-VII), but have since withdrawn those claims as to BONY and Carrington. (ECF No. 37 at 13.)

Plaintiffs sue Defendant Wirbicki, the law firm that represented BONY and Carrington in the foreclosure action, for aiding and abetting BONY and Carrington in not notifying the state court of the judicial sale of the Subject Property to Plaintiffs and allowing the property to be sold a second time (Count VIII). (See Compl. ¶¶ 107-116.)

Defendants BONY and Carrington have moved to dismiss Counts III and IV against them, and Defendant Wirbicki has moved to dismiss Count VIII against it.

Legal Standard

“A motion under Rule 12(b)(6) tests whether the complaint states a claim on which relief may be granted.” Richards v. Mitcheff, 696 F.3d 635, 637 (7th Cir. 2012). Under Rule 8(a)(2), a complaint must include “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). The short and plain statement under Rule 8(a)(2) must “‘give the defendant fair notice of what . . . the claim is and the grounds upon which it rests.'” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). Under federal notice-pleading standards, a plaintiff's “[f]actual allegations must be enough to raise a right to relief above the speculative level.” Id. Stated differently, “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556).

Discussion

The Court addresses Defendants' pending motions to dismiss in turn.

1. Wirbicki's Motion to Dismiss

Wirbicki moves to dismiss Count VIII, the sole claim brought against it, which alleges that it aided and abetted its clients BONY and Carrington by not notifying the courts in the foreclosure action and appeal regarding the sale of the property to Plaintiffs and allowing it to be sold to Lupera at a second judicial sale. Wirbicki claims it is immune from liability under Illinois's attorney litigation privilege, that Plaintiffs otherwise did not adequately plead their claim, and that Lupera's and the Sheriff's officers' actions were superseding and intervening causes that cut off Wirbicki's potential liability. Plaintiffs dispute each of these grounds.

The Court agrees with Wirbicki that it is entitled to immunity under Illinois's attorney litigation privilege. Illinois recognizes an absolute attorney litigation privilege based on section 586 of the Restatement (Second) of Torts:

An attorney at law is absolutely privileged to publish defamatory matter concerning another in communications preliminary to a proposed judicial proceeding, or in the institution of, or during the course and as part of, a judicial proceeding in which he participates as counsel, if it has some relation to the proceeding.

Restatement (Second) of Torts § 586 (1977); see also O'Callaghan v. Satherlie, 2015 IL App (1st) 142152, ¶ 24, 36 N.E.3d 999 (recognizing the privilege).

“The privilege applies to communications made before, during, and after litigation,” as well as to conduct. O'Callaghan, 2015 IL App (1st) 142152, ¶ 26; see also Scarpelli v. McDermott Will & Emery LLP, 2018 IL App (1st) 170874, ¶ 30, 117 N.E.3d 238, 250 (recognizing that the privilege “applies to actions taken by an attorney in connection with potential litigation just as it does to communications”). Though the Restatement is phrased in terms of defamation, the privilege extends beyond defamation claims. See id.; see also Goodman v. Goodman, 2023 IL App (2d) 220086, ¶ 27, 2023 WL 3608963, appeal denied, 221 N.E.3d 386 (Ill. 2023). The privilege “is intended to provide attorneys with the utmost freedom in their efforts to secure justice for their clients.” O'Callaghan, 2015 IL App (1st) 142152, ¶ 24. “[A]n attorney's motives are irrelevant,” and “no liability will attach even at the expense of uncompensated harm to the plaintiff.” Id. ¶ 25.

Plaintiffs argue that the litigation privilege does not apply because they were not involved in the foreclosure litigation until they filed their section 2-1401 petition. This is irrelevant- “there is no authority for the proposition that a party must be a party to the litigation for the absolute litigation privilege to apply.” Bedin v. Nw. Mem'l Hosp., 2021 IL App (1st) 190723, ¶ 47, 187 N.E.3d 739 (quoting Gorman-Dahm v. BMO Harris Bank, N.A., 2018 IL App (2d) 170082, ¶ 34, 94 N.E.3d 257). Wirbicki thus may claim immunity regardless of whether Plaintiffs were involved in the earlier foreclosure action.

Plaintiffs also argue that Count VIII alleges civil aiding and abetting rather than defamation or other types of claims to which other courts have applied the attorney litigation privilege. However, they point to no case in which a court refused to apply the privilege to an aiding-and-abetting claim and do not explain why the privilege should not apply to such a claim. Indeed, “in recent years, Illinois courts have extended ...