18-337-cv
Cho v. City of New York
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term, 2018
(Argued: September 27, 2018 Decided: December 11, 2018)
Docket No. 18-337-cv
SUNG CHO, Individually and on behalf of all others similarly situated,
NAGLE WASHRITE LLC, Individually and on behalf of all others similarly situated,
DAVID DIAZ, Individually and on behalf of all others similarly situated,
JAMEELAH EL-SHABAZZ, Individually and on behalf of all others similarly situated,
Plaintiffs-Appellants,
— v. —
CITY OF NEW YORK, MAYOR BILL DE BLASIO, in his official capacity as Mayor of the
City of New York, NEW YORK CITY POLICE DEPARTMENT, POLICE COMMISSIONER
JAMES P. O’NEILL, in his official capacity as New York City Police Commissioner,
NEW YORK CITY LAW DEPARTMENT, ZACHARY W. CARTER, in his official capacity
as Corporation Counsel of the City of New York,
Defendants-Appellees.
B e f o r e:
HALL, LYNCH, and CARNEY, Circuit Judges.
Plaintiffs-Appellants Sung Cho, Nagle Washrite LLC, David Diaz, and
Jameelah El-Shabazz appeal from the dismissal of their case in the United States
District Court for the Southern District of New York (Andrew L. Carter, Judge) for
lack of subject matter jurisdiction. Plaintiffs instituted this action under 42 U.S.C.
§ 1983, complaining that their constitutional rights were violated when they were
coerced by New York City officials into signing settlement agreements waiving
various constitutional rights in order to avoid eviction from their businesses and
residences. Because their settlement agreements were “so-ordered” by judges in
the state-court system, the district court concluded that it lacked jurisdiction
under the Rooker-Feldman doctrine, which prohibits federal-court jurisdiction over
cases that are de facto appeals from unfavorable state-court judgments. Because
plaintiffs’ alleged injuries were not caused by proceedings in state court, we
VACATE the judgment of the district court and REMAND for further
proceedings.
ROBERT EVERETT JOHNSON, Institute for Justice, Arlington, VA,
(Darpana M. Sheth, Institute for Justice, Arlington, VA, on the
brief), for Plaintiffs-Appellants.
JOHN MOORE, Assistant Corporation Counsel (Richard
Dearing, Jane L. Gordon, on the brief), for Zachary W. Carter,
Corporation Counsel, New York, NY, for Defendants-Appellees.
GERARD E. LYNCH, Circuit Judge:
This case requires us to consider the application of the Rooker-Feldman
doctrine where plaintiffs complain of injuries flowing from settlement
agreements that were “so-ordered” by state-court judges. Plaintiffs-Appellants
2
Sung Cho, Nagle Washrite LLC (Cho’s business entity), David Diaz, and
Jameelah El-Shabazz appeal from a judgment in the United States District Court
for the Southern District of New York (Andrew L. Carter, Judge) dismissing their
complaint. Plaintiffs-Appellants are all individuals or businesses that were
subject to eviction based on New York City’s Nuisance Abatement Law, N.Y.C.
Admin. Code §§ 7-701 et seq., and had agreed to settle eviction proceedings
brought by the City, rather than to litigate the nuisance charges. Defendants-
Appellees are the City of New York, New York City Mayor Bill de Blasio in his
official capacity, the New York City Police Department, New York City Police
Commissioner James P. O’Neill in his official capacity, the New York City Law
Department, and Zachary W. Carter, Corporation Counsel for the City of New
York, in his official capacity (collectively, the “City”). The district court dismissed
plaintiffs’ claims for lack of subject matter jurisdiction, concluding that they were
barred by the Rooker-Feldman doctrine. Cho v. City of N.Y., 2018 WL 401512
(S.D.N.Y. Jan. 12, 2018).
The single question on appeal is whether the district court’s Rooker-Feldman
ruling was erroneous. Plaintiffs argue that only one of Rooker-Feldman’s four
requirements is met and that therefore the case should proceed. Essentially, they
3
maintain that Rooker-Feldman should not bar jurisdiction where, as here,
plaintiffs’ alleged injuries were merely ratified by the state-court judgments rather
than caused by them.
As explained below, we agree that plaintiffs complain of injuries that were
merely ratified by the state-court judgments, and not, as required by Rooker-
Feldman, caused by them. Since Rooker-Feldman bars district court jurisdiction
only when all four of its requirements are met, it was therefore error for the
district court to dismiss for lack of jurisdiction.
Accordingly, we VACATE the judgment of the district court and
REMAND this case to the district court for further proceedings.
BACKGROUND
This appeal arises out of events that occurred when plaintiffs were charged
with violating New York City’s Nuisance Abatement Law, N.Y.C. Admin. Code
§§ 7-701 et seq. (the “Ordinance”).1 The plaintiffs entered into settlement
1
Because a court that rules on a defendant’s motion to dismiss a complaint “must
accept as true all of the factual allegations contained in the complaint,” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 572 (2007) (internal quotation marks omitted), we
describe the facts as alleged in the complaint, drawing all reasonable inferences
in the plaintiff’s favor, Littlejohn v. City of New York, 795 F.3d 297, 306 (2d Cir.
2015), and construing any ambiguities “in the light most favorable to upholding
the plaintiff’s claim,”Doe v. Columbia Univ., 831 F.3d 46, 48 (2d Cir. 2016).
4
agreements with the City rather than defend themselves in court; each one of
their agreements was subsequently “so-ordered” in state court. They now bring
claims in federal court under 42 U.S.C. § 1983.
Enacted in 1977 to address concerns that various illegal activities were
“detrimental to the health, safety, and welfare of the people of the city and of the
businesses thereof and visitors thereto,” the Ordinance allows the City to close a
residence or business for up to one year when it can show, by a preponderance of
the evidence, that certain enumerated offenses – such as drug crimes, stolen
property offenses, prostitution, or obscenity – occurred on the premises. Id. §§ 7-
701, 7-703. The Ordinance further allows the City’s Corporation Counsel to bring
an action in state court to permanently enjoin public nuisances and to enjoin the
person or persons “conducting, maintaining, or permitting the public nuisance”
from so doing. Id. § 7-706. Furthermore, at the time of the events that transpired
here, the Ordinance allowed the City to initiate an eviction action by obtaining an
order closing the premises in an ex parte proceeding if it could show “by clear and
convincing evidence” that one of the enumerated nuisances is “being conducted,
maintained or permitted” on any given property, without prior notice or
5
opportunity to be heard. Id. § 7-710 (2016).2 These temporary closing orders
functioned, practically, as eviction notices. Once such an action was initiated, a
hearing would be held within three business days, at which hearing the court
would decide whether the premises should remain closed throughout the course
of litigation. Id.
At the time of the relevant events, the Ordinance allowed for the issuance of
a temporary closing order regardless of the culpability of the defendant residents
and business owners. See, e.g., City of New York v. Castro, 559 N.Y.S.2d 508, 509 (1st
Dep’t 1990). Thus, the actions were frequently referred to as “no-fault evictions.”3
The complaint alleges that in practice the Ordinance allowed the City to easily
obtain temporary closing orders and that each of the plaintiffs discovered they
were evicted without notice, months after any alleged criminal activity occurred
on their premises.
2
The Ordinance has since been amended and no longer allows ex parte temporary
closing orders to issue where the nuisance is created by the sale of drugs or stolen
goods. N.Y.C. Admin. Code § 7-710.
3
The Ordinance has also since been amended to allow a defense where a
defendant “was not aware of, should not have been aware of, and had no reason
or duty to be aware of the public nuisance addressed by such disposition or
order.” N.Y.C. Admin. Code §§ 7-725, 7-726.
6
More specifically, the named plaintiffs allege the following: Sung Cho, a
laundromat owner, claims that the NYPD conducted sting operations on his
premises in which it used his laundromat to sell purportedly stolen electronics on
two separate occasions. Cho claims that several months after these sting
operations, he received a notice evicting him from his business and imposing
$1,000 per day in civil fines. A hearing was scheduled, but Cho settled with the
City the day before, understanding that even if he was able to prove that neither
he nor his employees had any involvement with the alleged criminal conduct, his
innocence would not provide a defense against the injunction.
The second named plaintiff, David Diaz, tells the following story: He and
his family members were arrested after cocaine was found in his apartment. No
charges were brought, however, against either Diaz or any member of his family.
Four months later, he returned home to a notice of eviction. Like Cho, Diaz settled
with the City rather than try to defend the litigation; the complaint alleges that the
City’s lawyer (whom he mistakenly thought was acting on his behalf) told him
that it would be “risky” to fight the eviction action, and that he therefore decided
not to take that risk, given the fact that he had an infant daughter. J.A. 30S31.
7
The third named plaintiff, Jameelah El-Shabazz, alleges as follows: She and
her son, Akin, were mistakenly arrested for drug possession when authorities
found paper cups of what was later determined to be crushed eggshells in her
apartment. El-Shabazz and her son sued the City for wrongful arrest, and the City
settled the suit by paying them $37,500. Four months after the arrest (and one
month after the settlement), El-Shabazz received an eviction notice based on an
affidavit from an NYPD officer who claimed (as had been since disproved) that
drugs had been found in her apartment. Like the other two plaintiffs, she settled
rather than defending the case.
The plaintiffs assert that the settlement agreements that they entered into
with the City required them to waive various constitutional rights. Cho’s
agreement required him to waive his right to a hearing if accused of further
violations, consent to future warrantless inspections, and install a camera
surveillance system to which the NYPD could have ready access. Diaz’s
agreement required him to bar all of his family members – except for his infant
daughter – from ever entering his apartment. El-Shabazz’s agreement required
her to permanently exclude her son Akin from the apartment. Each plaintiff
8
further alleges that his or her waiver of constitutional rights was not knowing and
voluntary and that he or she was pressured into settling by the City’s attorneys.
Importantly for purposes of this appeal, after the plaintiffs signed their
settlement agreements, each of the agreements was “so-ordered” by justices of the
Bronx and New York County Supreme Courts, and the nuisance actions were
dismissed. There were no further state-court proceedings.
On October 12, 2016, plaintiffs filed a federal lawsuit in the Southern
District of New York, seeking declaratory and injunctive relief on behalf of
themselves and a putative class. Specifically, they alleged that “City attorneys use
the[] eviction actions to compel property owners and leaseholders to enter into
settlement agreements waiving constitutional rights,” and that the “coercive
settlement agreements violate the Fourteenth Amendment.” J.A. 16. They asked
the court to permanently enjoin defendants from enforcing the agreements, to
declare the “agreements exacted” to be “unconstitutional, invalid, and
unenforceable,” and to award nominal damages. J.A. 66S67.
In response, defendants moved to dismiss for a number of reasons
including, inter alia, statute of limitations and failure to state a claim. At oral
argument on the motion to dismiss, the district court sua sponte raised concerns
9
about its jurisdiction, citing the Rooker-Feldman doctrine, and asked the parties for
supplemental briefing on that issue. Upon review, the district court held that the
Rooker-Feldman doctrine barred jurisdiction and thus dismissed the case. This
appeal followed.
DISCUSSION
When a federal suit follows a state suit, the former may, under certain
circumstances, be prohibited by what has become known as the Rooker-Feldman
doctrine. See 18B Charles Alan Wright, Arthur R. Miller & Edward H. Cooper,
Federal Practice & Procedure: Jurisdiction 2d § 4469.1 (2018). Our review of a
district court’s application of Rooker-Feldman is de novo. See, e.g., Green v.
Mattingly, 585 F.3d 97, 101 (2d Cir. 2009).
I. The Rooker-Feldman Doctrine
The Rooker-Feldman doctrine is named for two Supreme Court cases, Rooker
v. Fidelity Trust Co., 263 U.S. 413 (1923), and District of Columbia Court of Appeals v.
Feldman, 460 U.S. 462 (1983). Together, those cases “established the clear principle
that federal district courts lack jurisdiction over suits that are, in substance,
appeals from state-court judgments.” Hoblock v. Albany Cty. Bd. of Elections, 422
F.3d 77, 84 (2d Cir. 2005). The Rooker-Feldman doctrine, then, emerged as a
10
response to complaints that “invited federal courts of first instance to review and
reverse unfavorable state-court judgments.” Exxon Mobil Corp. v. Saudi Basic Indus.
Corp., 544 U.S. 280, 283 (2005). Since federal district courts are granted original –
and not appellate – jurisdiction, cases that function as de facto appeals of state-
court judgments are therefore jurisdictionally barred.4
However, beyond establishing this basic principle, Rooker and Feldman
“provided little guidance on how to apply [it].” Hoblock, 422 F.3d at 84. Prior to the
Supreme Court’s decision in Exxon Mobil, federal courts had applied the Rooker-
Feldman doctrine “expansively,” and considered it “effectively coextensive with
doctrines of claim and issue preclusion.” Id. In Exxon Mobil, however, the Court
noted that the “doctrine ha[d] sometimes been construed to extend far beyond the
contours of the Rooker and Feldman cases,” and thus had often “overrid[den]
Congress’ conferral of federal-court jurisdiction concurrent with jurisdiction
exercised by state courts.” Exxon Mobil, 544 U.S. at 283. The Court proceeded to
considerably narrow the doctrine, holding that Rooker-Feldman was “confined to
cases of the kind from which the doctrine acquired its name: cases brought by
4
Parties who contend that adverse state judgments are flawed for reasons raising
federal questions may, of course, seek review in the Supreme Court, which has
appellate jurisdiction in such matters. U.S. CONST. art. III.
11
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. at 284.
Much of our previous case law was thus abrogated, and we subsequently
articulated that in order for a court to be deprived of jurisdiction under the Rooker-
Feldman doctrine, four requirements must be met: (1) the federal-court plaintiff
must have lost in state court; (2) the plaintiff must complain of injuries caused by
a state-court judgment; (3) the plaintiff must invite district court review and
rejection of that judgment; and (4) the state-court judgment must have been
rendered before the district court proceedings commenced. Hoblock, 422 F.3d at 85.
Since Exxon Mobil, we have applied the Rooker-Feldman doctrine with some
frequency to cases involving suits directly against state-court judges,5 or in which
error by state-court judges in state-court proceedings is asserted, frequently in the
5
See, e.g., Richter v. Conn. Judicial Branch, 600 F. App’x 804, 805 (2d Cir. 2015)
(Rooker-Feldman barred jurisdiction where plaintiff sued state-court judges
alleging that judgments against her were invalid and should be overturned);
Jordan v. Levine, 536 F. App’x 158, 159 (2d Cir. 2013) (Rooker-Feldman barred
jurisdiction where plaintiff sued state-court judge alleging judicial misconduct);
Daigneault v. Judicial Branch, Conn., 309 F. App’x 518, 519 (2d Cir. 2009) (Rooker-
Feldman barred jurisdiction where plaintiff sued state-court judges for dismissing
his discrimination lawsuit).
12
foreclosure process.6 As relevant to this case, when considering challenges to
stipulated settlements, we have ruled that Rooker-Feldman acted as a procedural
bar in Fraccola v. Grow, 670 F. App’x 34 (2d Cir. 2016), in which a plaintiff sued a
state-court judge, alleging that the judge improperly so-ordered a stipulation at
the ex parte request of the opposing party.
In contrast, we have concluded that Rooker-Feldman did not apply where a
plaintiff filed a federal suit alleging that defendants’ conduct during the course of
a state foreclosure action violated, inter alia, the Fair Debt Collection Practices Act
(“FDCPA”). See Gabriele v. Am. Home Mortg. Servicing, Inc., 503 F. App’x 89 (2d Cir.
2012). Specifically, we held that the “alleged litigation misconduct [by defendants
and their lawyers] was not the product of the state court’s denial of sanctions, its
judgment of strict foreclosure, or any other decision rendered, but rather, was
‘simply ratified, acquiesced in, or left unpunished by [the state court judgment].’”
Id. at 92, quoting Hoblock, 422 F.3d at 88.
6
See, e.g., Vossbrinck v. Accredited Home Lenders, Inc., 773 F.3d 423, 427 (2d Cir.
2014) (plaintiff claimed that his foreclosure judgment was obtained via fraud and
in error; claim barred by Rooker-Feldman as it would require “the federal court to
review the state proceeding and determine that the foreclosure judgment was
issued in error”); Worthy-Pugh v. Deutsche Bank Nat’l Tr. Co., 664 F. App’x 20, 21
(2d Cir. 2016) (same).
13
In an analogous context, in Sykes v. Mel S. Harris and Associates, LLC, 780
F.3d 70 (2d Cir. 2015), we considered whether plaintiffs’ alleged injuries were
caused by state-court judgments, and whether therefore their suit was barred by
Rooker-Feldman, where the plaintiff-debtors alleged that the defendant-creditors
had engaged in a fraudulent scheme to obtain default judgments against them in
state court. More specifically, plaintiffs alleged that defendants ran a “default
judgment mill” where they engaged in a fraudulent course of conduct including
submitting fraudulent documents to state courts in order to obtain default
judgments. Id. at 75. We concluded that the case was not barred by Rooker-
Feldman, specifically considering whether the state-court judgments caused
plaintiffs’ injuries, and noting that “claims sounding under the FDCPA, RICO,
and state law speak not to the propriety of the state court judgments, but to the
fraudulent course of conduct that defendants pursued in obtaining such
judgments.” Id. at 94S95.7
7
In surveying our applications of Rooker-Feldman, we have cited a number of
unpublished summary orders. We do so not to rely on any proposition of law
they might be taken to establish – by definition such orders merely apply
established law to particular sets of facts. But precisely because such orders
illustrate routine applications of established law, the pattern of results that they
reach can provide an informative survey of the kinds of cases in which a doctrine
has been found unproblematically to apply or not to apply.
14
II. Rooker-Feldman’s Second Requirement
While all four requirements must be met in order for Rooker-Feldman to act
as a jurisdictional bar, we have held that the second requirement – that the
plaintiff complains of an injury caused by a state-court judgment – is the “core
requirement from which the other[] [Rooker-Feldman requirements] derive.”
Hoblock, 422 F.3d at 87. Acknowledging that occasionally “federal suits that
purport to complain of injury by individuals in reality complain of injury by state-
court judgments,” we developed the following formula to help guide our inquiry:
“a federal suit complains of injury from a state-court judgment, even if it appears
to complain only of a third party’s actions, when the third party’s actions are
produced by a state-court judgment and not simply ratified, acquiesced in, or left
unpunished by it.” Id. at 88.
On appeal here, plaintiffs allege, inter alia, that the state courts merely
ratified rather than produced their injuries, and that therefore, the district court
erred when it dismissed their suit for lack of jurisdiction. We thus begin by
analyzing Rooker-Feldman’s “core” substantive requirement: are the injuries of
which plaintiffs complain produced by the state-court judgments at question or
15
merely ratified by such judgments? We conclude that they are merely ratified, for
reasons explained below.
III. Plaintiffs’ Alleged Injuries
First, we look to the complaint to determine the nature of the injury of
which plaintiffs complain. Plaintiffs target what they describe as a “lumbering
and indiscriminate law enforcement program that forces ordinary, innocent
people to waive their constitutional rights without being accused, much less
convicted, of a crime.” J.A. 15. According to plaintiffs, the injuries of which they
complain flow from the City’s conduct in enforcing the Ordinance, specifically the
allegedly predatory conduct of the City’s attorneys. Plaintiffs complain that the
“City attorneys use [no-fault] eviction actions to compel property owners and
leaseholders to enter into settlement agreements waiving constitutional rights”
and that the “coercive settlement agreements violate the Fourteenth
Amendment.” J.A. 16. They argue repeatedly that at heart, their complaint is
about the agreements themselves and the conduct that led to them – not the
judgments so-ordered by the state court.
Defendants dispute plaintiffs’ argument that the injury of which they
complain is caused by conduct leading to the agreements, but do concur that the
16
agreements themselves are the injury. They argue, however, that the agreements
are indistinguishable from the state judgments that were filed when the state-
court judges so-ordered the agreements.
The relevant case law persuades us that plaintiffs have the stronger
argument. In Sykes, for example, we held that Rooker-Feldman did not bar the
district court’s jurisdiction where similar misconduct was alleged; specifically, the
plaintiffs alleged that defendants were engaged in a “default judgment mill” to
obtain state-court judgments by unlawful means. 780 F.3d at 75S76. We held that
Rooker-Feldman did not apply, primarily because plaintiffs brought claims under
the FDCPA, RICO, and state law, which we said “speak not to the propriety of the
state court judgments, but to the fraudulent course of conduct that defendants
pursued in obtaining such judgments.” Id. at 94S95. Though our holding relied
partially on the fact that plaintiffs’ claim did not primarily target the reversal of
the default judgments (the third Rooker-Feldman requirement), we also concluded
that the state-court judgments were a mere ratification of the harm allegedly
caused by defendants. Id.
Several courts in our Circuit have similarly held that state-court action was
a mere “ratification” of the injury in similar circumstances, and thus that Rooker-
17
Feldman’s second requirement was not met. For example, in Green v. City of New
York, 438 F. Supp. 2d 111 (E.D.N.Y. 2006), the plaintiffs alleged that the City had a
policy of improperly inflating the amounts of liens placed against the proceeds of
personal injury claims, and that the plaintiffs had relied on those amounts to their
detriment in settlement agreements. The court held that the “injury plaintiffs
allege was not caused by the state court judgments” but merely ratified by it. Id. at
121. Similarly, in Capela v. J.G. Wentworth, LLC, 2009 WL 3128003, at *6 (E.D.N.Y.
Sept. 24, 2009), the plaintiffs claimed that defendants’ alleged Truth in Lending
Act violations led to plaintiffs signing court-approved settlements; the court there
held that the “lawsuit [did] not complain of an injury caused by the state court
order and seek that order’s reversal, inasmuch as the order ‘simply’ approved the
Purchase Agreement entered into by the parties.”8
8
Districts courts outside our Circuit have also found a mere “ratification” in
similar circumstances. See, e.g., Arnett v. Arnett, 2014 WL 2573291, at *1S2 (D. Utah
June 9, 2014) (holding that a divorce settlement agreement was not itself a state-
court judgment, despite being so-ordered, and finding that the state court’s
decree of divorce “at most only ratified, acquiesced in, or left unpunished” the
settlement agreement); In re Chinin USA, Inc., 327 B.R. 325 (N.D. Ill. 2005)
(holding that plaintiffs’ alleged injury was a fraudulent transfer flowing from a
settlement agreement and not from the state-court judgment that approved that
agreement).
18
These cases are persuasive that where, as here, plaintiffs bring claims
alleging harm flowing from wrongful conduct leading to settlement terms and do
not argue that the state courts committed any error in so-ordering the parties’
agreements, the complaint attacks the conduct itself, and the claim does not
function as a de facto appeal. Defendants point us towards Fraccola, 670 F. App’x at
34, and Niles v. Wilshire Investment Group, LLC, 859 F. Supp. 2d 308 (E.D.N.Y.
2012), as persuasive precedent to the contrary. However, both of those cases
involved alleged judicial misconduct and/or named the judges as defendants, and
thus are easily distinguishable. Accordingly, examining the complaint in the
context of prior precedents of our own and of other courts, we find support for
plaintiffs’ argument that they are not engaged in de facto appeals of state-court
judgments.
Plaintiffs further argue that the harm of which they complain exists
separate and apart from the state-court judgments, for two reasons. First, they
argue that their constitutional rights were violated when they were forced to sign
the settlement agreements, whether such agreements were enforceable or not.
Second, they argue that, as two of the three agreements contained in the record
became enforceable as of signing, they were legally binding contracts to which
19
plaintiffs were bound even before the state court so-ordered them. For its part, the
City considers the state-court judgments and the settlement agreements to be one
and the same, arguing that it was “only in the state courts’ so-ordering of those
agreements that the City obtained the power to take the actions that plaintiffs
claim caused them injury.” Appellee Br. 28. We will consider each argument in
turn.
First, plaintiffs argue that harm befell them “as soon as” the City engaged in
conduct with the aim of coercing them to waive their constitutional rights; more
specifically, they claim that even “[i]f the City had not succeeded in depriving
Plaintiffs of their constitutional rights, the City’s negotiating tactics still would
have violated the Constitution and given rise – at a minimum – to a claim for
nominal damages.” Appellant Reply Br. 13 (first emphasis added) (citing Amato v.
City of Saratoga Springs, N.Y., 170 F.3d 311, 317 (2d Cir. 1999)). We agree that if
plaintiffs were in fact coerced into unconstitutional waivers, they might sustain an
injury regardless of the waivers’ enforceability.9 See, e.g., Smith v. Coughlin, 748
F.2d 783, 789 (2d Cir. 1984) (“[E]ven when a litigant fails to prove actual
9
Plaintiffs have, in fact, sought nominal damages of $10.00 each. J.A. 67.
20
compensable injury, he is entitled to an award of nominal damages upon proof of
violation of a substantive constitutional right.”)
Second, plaintiffs maintain that tangible harm befell them as soon as the
contracts were signed. Cho signed his agreement on December 23, 2013, but it was
not filed with the court until March 18, 2014. J.A. 250S56. Likewise, El-Shabazz
signed her agreement on September 29, 2011, and it was not filed with the court
until October 17, 2011.10 J.A. 140S43. Since the agreements state that the
“Stipulation of Settlement shall be effective immediately upon execution of the
parties,” and the agreements were signed significantly before they were filed with
the state court, plaintiffs appear to be correct that they were bound by their terms
immediately, regardless of the action of the state courts.11 J.A. 142, 255. Especially
10
The record does not disclose when the state judges actually “so-ordered” the
agreements, and defendants argue that “[n]one of the injuries alleged in
plaintiffs’ complaint had occurred when the state courts so-ordered their
settlement stipulations on the same day plaintiffs agreed to them.” Appellee Br. 29
(emphasis added). However, the evidence in the record reveals only the dates on
which the stipulations were filed with the courts.
11
Defendants also argue that this argument is unpreserved, but the dates are part
of the settlement agreements, of which the district court took judicial notice. As
plaintiffs have consistently argued that the harm flowed from the agreements
themselves, and not the state-court actions, we can properly consider the
additional fact that the agreements were filed only some time after their signing,
and that they were effective immediately upon signing. See, e.g., United States v.
Erie Cty., N.Y., 763 F.3d 235, 242 n.7 (2d Cir. 2014) (allowing new facts that were
21
as the agreements included provisions, for example, banning particular people
from the premises (in El-Shabazz’s case, her son), plaintiffs’ arguments that harm
befell them as soon as they signed are persuasive.12 Moreover, even were that not
the case, and the stipulations were effective only after being so-ordered by the
state court, plaintiffs are still attacking the agreements themselves and the course
of conduct that led to them, rather than the state courts’ rulings.
The instant case thus does not entail the evil Rooker-Feldman was designed
to prevent. Plaintiffs are attempting to remedy an alleged injury caused when,
prior to any judicial action, they were coerced to settle, not an injury that flows
from a state-court judgment. By allowing an action such as this to go forward, we
“readily available in the record below” in the service of previously-made
arguments).
12
We note that even if the agreements were enforceable only after they were
judicially approved (as was the case with Diaz), the precedents we discuss above
include many instances in which we found that state-court action was a mere
“ratification,” and not the cause of the injuries. See, e.g., Sykes, 780 F.3d at 75S76
(holding that though plaintiffs complained of defendants’ conduct in creating a
default judgment mill that would end in a state-court judgment, that judgment
was a mere ratification); Gabriele, 503 F. App’x at 92 (holding that state-court
action was mere ratification where a defendant’s conduct was targeted at
obtaining a foreclosure judgment).
22
do not risk turning our federal district courts into quasi-appellate courts sitting in
review of state-court decisions.13
CONCLUSION
For the foregoing reasons, we VACATE the judgment of the district court
and remand for further proceedings.
13
Plaintiffs also argue both that they are not state-court losers and that they do
not seek review and reversal of any state-court judgments. Because Rooker-
Feldman will bar jurisdiction only when all four of its requirements are met, and
we have already held that the injury of which plaintiffs complain was merely
ratified by the state court, we need not address those arguments.
23