Krage v. EMC MORTGAGE CORPORATION et al

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NOT FOR PUBLICATION
UNITED STATES BANKRUPTCY COURT
CENTRAL DISTRICT OF CALIFORNIA
LOS ANGELES DIVISION
In re:
JAMES ARTHUR KRAGE
Debtor(s).
CHAPTER 13
Case No.: 2:12-bk-17916-WB
Adv No: 2:14-ap-01687-WB
JAMES ARTHUR KRAGE
Plaintiff(s),
v.
U.S. BANK NATIONAL ASSOCIATION
AS SUCCESSOR BY MERGER TO
LASALLE BANK NATIONAL
ASSOCIATION, AS TRUSTEE FOR
CERTIFICATEHOLDERS OF BEAR
STEARNS ASSET BACKED SECURITIES I
LLC, ASSET-BACKED CERTIFICATES,
SERIES 2005-HE9, ITS SUCCESSORS
AND/OR ASSIGNS; EMC MORTGAGE
CORPORATION; BEAR STEARNS ASSET
BACKED SECURITIES I LLC;
MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS AKA MERS;
AND DOES 1-100 INCLUSIVE,
Defendant(s).
MEMORANDUM OF DECISION ON
MOTION TO DECLARE PLAINTIFF JAMES
A. KRAGE A VEXATIOUS LITIGANT FOR
ORDER TO FURNISH SECURITY AND FOR
PREFILING ORDER
Date: January 20, 2015
Time: 2:00 p.m.
Courtroom: 1375
FILED & ENTERED
FEB 10 2015
CLERK U.S. BANKRUPTCY COURT
Central District of California
BY DEPUTY CLERK	kaaumoan
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Defendants JPMorgan Chase Bank, N.A.’s (“Chase”), successor servicer to EMC
Mortgage LLC, f.k.a. EMC Mortgage Corporation and Bear Stearns Asset Backed Secureties I
LLC (“Bear Stearns”) (collectively, “Defendants”) motion to declare plaintiff James Arthur
Krage (“Krage” or “Plaintiff”) a vexatious litigant and for an order to furnish security and a
prefiling order (“Motion”), came on for hearing before this court on January 20, 2015 at 2:00
p.m. Appearances were made as noted on the record. Having read the Defendants’ Motion,
Plaintiff’s opposition thereto, and the Defendants’ reply, and carefully considered their
arguments and the relevant legal authority, and good cause appearing, the Court grants the relief
requested in the Motion based upon the following findings of fact and conclusions of law
pursuant to F.R.Civ.P. 52(a)(1)1, as incorporated into FRPB 7052 and applied to contested
matters by FRBP 9014(c).
I. STATEMENT OF FACTS
A. Krage’s First Bankruptcy Case
On August 8, 2008, Krage filed a voluntary petition under chapter 13 in Case No. 2:08-
bk-22336-AA in the United States Bankruptcy Court, Central District of California, Los Angeles
Division. On December 19, 2008, the court entered an order dismissing the case pursuant to the
chapter 13 confirmation hearing. The case was closed on October 19, 2010.
B. Krage’s Second Bankruptcy Case
While his first case was pending, Krage filed a second voluntary petition under chapter
13 in Case No. 2:08-32959-AA in the United States Bankruptcy Court, Central District of
California, Los Angeles Division. On November 6, 2009, an order was entered dismissing the
case for failure to make required plan payments. The case was closed on February 12, 2010.
1 Unless otherwise indicated, all “Code,” “chapter” and “section” references are to the
Bankruptcy Code, 11 U.S.C. §§ 101-1330 after its amendment by the Bankruptcy Abuse
Prevention and Consumer Protection Act of 2005, Pub. L. 109-8, 119 Stat. 23 (2005). “Rule”
references are to the Federal Rules of Bankruptcy Procedure (“FRBP”), which make applicable
certain Federal Rules of Civil Procedure (“F.R.Civ.P”). “L.R.” references are to the Local Rules
of the United States District Court for the Central District of California. “LBR” references are to
the Local Bankruptcy Rules of the United States Bankruptcy Court for the Central District of
California.
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C. Krage’s Third Bankruptcy Case
While his second case was pending, Krage filed a third voluntary chapter 13 petition in
Case No. 2:09-bk-46466-ER in the United States Bankruptcy Court, Central District of
California, Los Angeles Division. On February 1, 2011, the court entered an order dismissing
the case pursuant to the chapter 13 confirmation hearing. The case was closed on October 18,
2011.
D. Krage’s Fourth Bankruptcy Case
Krage filed this fourth voluntary petition under chapter 13 in Case No. 2:12-bk-17916-
WB, the current underlying bankruptcy case, on March 5, 2012 in the United States Bankruptcy
Court, Central District of California, Los Angeles Division.
During the two years and ten months this case has been pending, Krage has commenced
five adversary proceedings—three of which take issue with promissory note ownership and lien
validity and challenge the foreclosure sale related to residential real property located in
Bellflower California, and allege California real property and tort claims. In 2011, Krage, along
with the owner of the property, Douglas Matthews, also had filed litigation in California Superior
Court challenging the note, liens and foreclosure of the same property.
The relevant facts alleged in the state court case and in each of the three adversary
proceedings at issue are as follows:
In April 2005, non-party Douglas Matthews (“Matthews”) obtained a loan for
$276,500.00 (the “Loan”) from non-party RESMAE Mortgage Corporation (“RESMAE”) by
executing a promissory note (“Note”) and a deed of trust (“Deed of Trust”), secured by the
subject real property located at 9735 Harvard Avenue, Bellflower, California 90706 (the
“Property”). On April 27, 2005, the Deed of Trust was recorded in the Los Angeles County
Recorder’s Office. Mortgage Electronic Systems (“MERS”) was identified under the Deed of
Trust as the beneficiary and nominee of lender and lender’s successors and/or assigns.
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On March 3, 2006, MERS, as the beneficiary under the Deed of Trust, executed a
“Substitution of Trustee,” naming Cal-Western Reconveyance Corporation (“Cal-Western”) as
trustee and Chase began servicing the Loan.
On October 23, 2009, MERS assigned its beneficial interest in the Deed of Trust to Bank
of America, N.A. (“Bank of America”). In the event of default, the Deed of Trust authorized the
lender to direct the trustee to commence foreclosure proceedings in accordance with California
law.
On May 27, 2010, Cal-Western recorded a notice of default on the Loan. At that time,
Matthews was almost $128,000.00 in arrears. On September 2, 2010, after Matthews failed to
cure the default, Cal-Western recorded a Notice of Trustee’s Sale, scheduling the foreclosure
sale for September 22, 2010 (the “Foreclosure Sale”). Matthews failed to reinstate the Loan and,
on December 20, 2010, Cal-Western recorded a Trustee’s Deed Upon Sale in favor of Bank of
America, which had been the winning bidder at the Foreclosure Sale.
Approximately six months prior to the Foreclosure Sale, Krage and Matthews entered
into a long-term residential lease agreement allowing Krage to rent one quarter (¼) of the
Property’s garage for storage of personal belongings and to park his recreational vehicle (the
“RV”) on the Property’s driveway.
As alleged in the complaints, on or about March 22, 2011, Bank of America, through its
agents JPMorgan Chase Bank (“Chase”), Nelson Herman Sanchez (“Sanchez”) (a Century 21
real estate agent), and David Sarinana (“Sarinana”) (a Century 21 real estate broker) perpetrated
forcible entry and forcible detainer multiple times against Krage. Specifically, Krage arrived at
the Property and was told that Bank of America was taking possession of the Property. Krage
was also told that he had to move his RV or it would be towed. Krage asserts he complied and
moved the RV across the street.
Later that day, Krage saw that the Bank of America workers were removing items
belonging to Krage from the garage of the Property (mostly, Krage’s books). Krage asked the
workers to return the books to the garage; however, they refused and allowed Krage to only take
items that had not been loaded onto their truck yet.
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At some point after Krage’s books were taken away, Sanchez entered the Property. In
the complaint, Krage does not specify whether Sanchez took any of Krage’s belongings. Instead,
the complaint alleges that under the direct supervision of a Sheriff, under instructions from Bank
of America and pursuant to Bank of America’s recorded trustee’s deed upon sale, Sanchez
changed the locks at the Property while it was vacant.
Each of the lawsuits alleges a version of the same operative facts on the same or similar
theories of recovery against the same parties or successor parties.
a. State Court Action, Case No. VC058398
Prior to the commencement of the adversary proceedings in Krage’s bankruptcy case, on
March 28, 2011, Krage and Matthews commenced an action against Bank of America among
other defendants in the Los Angeles Superior Court (Case No. VC058398) (the “State Court
Action”), styled Douglas M. Matthews v. Nelson Herman Sanchez , et al. Sanchez and Sarinana
were also among the named defendants in the State Court Action. In their first amended
complaint filed on June 20, 2011, Krage and Matthews asserted the following causes of action:
(1) quiet title; (2) injunctive relief; (3) improper foreclosure procedure; (4) improper eviction
procedure; (5) trespass to commit forcible entry and forcible detainer against owner in
possession and tenant in possession with threats, and (6) failure to enforce the law.
On November 16, 2011, the Superior Court entered an order sustaining Bank of
America’s demurrer to Krage and Matthew’s first amended complaint without leave to amend as
to all causes of action, except for the sixth cause of action for failure to enforce the law.
b. First Adversary Proceeding, No. 2:12-ap-02136-WB
On September 6, 2012, Krage and co-plaintiff Matthews filed an 88-page complaint in
Adversary No. 2:12-ap-02136-WB, styled Douglas M. Matthews and James A. Krage v. Bank
of America, National Association et al. The complaint asserted claims for (1) declaratory relief,
(2) quiet title, and (3) action to enforce Public Law 111-22. In the complaint, Krage and
Matthews challenged the validity of the foreclosure sale and alleged that the lien created by the
2005 Deed of Trust was invalid and void because it was defective on its face, it had been
bifurcated from the Note, defendants had no right, title, or interest in the Deed of Trust, and other
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apparent deficiencies. The defendants named in Krage’s complaint included Bank of America as
Successor by Merger to Lasalle Bank National Association, as Trustee for Certificate holders of
Bear Stearns Asset-Backed Securities I LLC, Asset-Backed Certificates, Series 2005-HE9,
Chase and Cal-Western. In response thereto, defendants Bank of America and Chase moved to
dismiss Krage’s complaint under Rule 12(b)(6) and the doctrine of res judicata. Krage opposed
the motion. After a hearing on November 20, 2012, an order was entered dismissing the
adversary proceeding with prejudice.
c. Second Adversary Proceeding, No. 2:13-ap-02132-WB
On November 26, 2013, Krage filed a 36-page complaint in Adversary No. 2:13-ap-
02132-WB, styled James A. Krage v. Bank of America, National Association et al., seeking
actual and punitive damages from each defendant for wrongful foreclosure and arguing that
Krage was protected by the Protecting Tenants at Foreclosure Act (“PTFA”), Pub. L. No. 111-
22. The complaint asserted the following claims for relief concerning the Property: (1)
declaratory relief; (2) theft; (3) repetitive harassment; (4) forcible detainer and forcible entry; and
(5) enforcement of Public Law 111-22. The defendants named in this complaint included Bank
of America, as trustee, Chase, Sanchez, and Sarinana. In the complaint, Krage again challenged
the validity of the note and lien, the enforcement of the lien and note and alleged that Sanchez (a
Century 21 real estate agent) and Sarinana (a Century 21 real estate broker) perpetrated forcible
entry and forcible detainer against Krage, based on the improper foreclosure on the property. In
response thereto, defendant Chase and defendants Sanchez and Sarinana filed motions to dismiss
Krage’s complaint pursuant to Rule 12(b)(6) and the doctrine of res judicata. On June 2, 2014,
the court issued a memorandum of decision and entered an order of the same date granting the
motions to dismiss with prejudice.
On July 9, 2014, Krage filed a motion to reconsider the order granting defendants Chase
and Sanchez and Sarinana’s motions to dismiss the complaint. After a hearing, the Court issued
a memorandum of decision and order on November 26, 2014 denying the motion to reconsider.
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d. Third Adversary Proceeding, No. 2:14-ap-01687-WB
While the motion to reconsider was pending in Adversary No. 2:13-ap-02132-WB, Krage
filed this 38-page complaint in Adversary No. 2:14-ap-01687, on October 28, 2014, alleging
causes of action for: (1) lack of standing to foreclose; (2) quiet title; (3) slander of title; and (4)
declaratory relief. The defendants named in Krage’s complaint included U.S. Bank National
Association (“U.S. Bank”) as Successor Trustee to Bank of America, EMC Mortgage
Corporation, Bear Stearns Asset Backed Securities I LLC, and MERS. In response thereto,
defendants U.S. Bank (successor to Bank of America) and Chase (successor servicer to EMC
Mortgage Corporation) separately filed motions to dismiss Krage’s complaint pursuant to Rule
12(b)(6) and the doctrine of res judicata. On December 15, 2015, Chase also filed a Motion to
Declare Plaintiff James A. Krage a Vexatious Litigant, for an Order to Furnish Security and for a
Prefiling Order. After a hearing on January 20, 2015, the court granted the motions to dismiss
the Complaint without leave to amend.
In his Complaint, Krage, who was not the owner of the Property or a borrower, sought
“rescission of the stated loan in its entirety” among other relief. In general, the Complaint
alleges that: (1) the lien created by the Deed of Trust in 2005 is invalid and void because it is
defective on its face; (2) it has been bifurcated from the Note; (3) Defendants have no right, title
or interest in the Deed of Trust; and (4) Defendants lack authority to foreclose.
In response to Krage’s Complaint, Defendants, along with co-defendants, filed motions
seeking to dismiss the Complaint under Rule 12(b)(6) for Krage’s failure to state a claim upon
which relief can be granted. Additionally, Defendants asserted that the entire action was barred
by the doctrines of res judicata and collateral estoppel and that Krage lacked standing to
challenge the foreclosure sale because he was not the borrower nor did he have any ownership
interest in the Property. Defendants also filed the Motion seeking an order declaring Krage a
vexatious litigant.
After a hearing was held on January 20, 2015, the court granted the Defendants’ and co-
defendants’ motions to dismiss the Complaint without leave to amend. The court took
Defendants’ Motion for an order declaring Krage a vexatious litigant under submission.
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II. DISCUSSION
A. Standard for Determining Whether to Issue a Pre-filing Order against a Vexatious Litigant
Bankruptcy courts have the power to regulate vexatious litigation pursuant to 11 U.S.C. §
105(a) and 28 U.S.C. § 1651(a). Bankruptcy Code § 105(a) permits the bankruptcy court to
“issue any order, process, or judgment that is necessary or appropriate to carry out the provisions
of the Bankruptcy Code.” Federal courts have discretion to enjoin parties from frivolous
litigation under the All-Writs Act, 28 U.S.C. § 1651. See, e.g., Molski v. Evergreen Dynasty
Corp., 500 F.3d 1047, 1051 (9th Cir. 2007) (“The All Writs Act, 28 U.S.C. § 1651(a), provides
district courts with the inherent power to enter pre-filing orders against vexatious litigants with
abusive and lengthy histories of litigation.”); De Long v. Hennesey, 912 F.2d 1144, 1146 (9th
Cir. 1990) (“We recognize that ‘there is strong precedent establishing the inherent power of
federal courts to regulate the activities of abusive litigants by imposing carefully tailored
restrictions under appropriate circumstances.’”) (citing Tripati v. Beaman, 878 F.2d 351, 352
(10th Cir. 1989)). “Bankruptcy courts, being courts established by Act of Congress, ‘have the
power to regulate vexatious litigation pursuant to 11 U.S.C. § 105 and 28 U.S.C. § 1651.’”
Goodman v. Cal. Portland Cement Co. (In re GTI Capital Holdings, LLC), 420 B.R. 1, 11
(Bankr. D. Ariz. 2009) (quoting Lakusta v. Evans (In re Lakusta), 2007 WL 2255230, * 3 (N.D.
Cal. 2007)).
Specifically, the court may enter an order requiring that the litigant obtain the approval of
a judge before being allowed to file an action. See Molski, 500 F.3d at 1057 (recognizing that
district courts have “inherent power to enter pre-filing orders against vexatious litigants”).
Before imposing a pre-filing order against a vexatious litigant in the Ninth Circuit, the court
must: (1) give the litigant notice and an opportunity to be heard before the order is entered; (2)
compile an adequate record for review; (3) make substantive findings as to the frivolous or
harassing nature of the litigant’s actions; and (4) draft an order that is “narrowly tailored to
closely fit the specific vice encountered.” De Long, 912 F.2d at 1147-48. In Molski, the Ninth
Circuit observed that the five factors set forth in Safir v. United States Lines, Inc., 792 F.2d 19
(2d Cir. 1986) provide “a helpful framework for applying the two substantive factors (factors
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three and four)” of the De Long test. Molski, 500 F.3d at 1058. The Safir factors are: “(1) the
litigants history of litigation and in particular whether it entailed vexatious, harassing or
duplicative lawsuits; (2) the litigant’s motive in pursuing the litigation, e.g., does the litigant
have an objective good faith expectation of prevailing?; (3) whether the litigant is represented by
counsel; (4) whether the litigant has caused needless expense to other parties or has posed an
unnecessary burden on the courts and their personnel; and (5) whether other sanctions would be
adequate to protect the courts and other parties.” Safir, 792 F.2d at 24.
1. Notice and Chance to be Heard before the Order is Entered.
Notice and chance to be heard before the order is entered “is a core requirement of due
process.” De Long, 912 F.2d at 1147. In this case, Krage was properly served with the
Defendant’s Motion seeking that he be declared a vexatious litigant and requesting that a pre-
filing order be entered against him. Krage had adequate notice of the date, time and place of the
hearing. Krage appeared at the hearing in opposition to the Motion. Krage had sufficient notice
of the relief sought by the Defendants and an adequate opportunity to be heard on the matter.
See Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950) (Due process is
satisfied when notice is “reasonably calculated, under all of the circumstances to apprise
interested parties of the pendency of the action and to afford them the opportunity to present their
objections.”).
2. There is an Adequate Record for Review Detailing the Harassing Nature of Krage’s
Litigations.
“An adequate record for review should include a listing of all the cases and motions that
[leads] the court to conclude that a vexatious litigant order [is] needed.” De Long, 912 F.2d at
1147. “At the least, the record needs to show, in some manner, that the litigant’s activities were
numerous or abusive.” Id. (citations omitted) (emphasis added). As set forth in detail above,
Krage has filed one state court action and three adversary proceedings in this court, challenging
the validity of the lien, note and foreclosure sale related to the Property and the ensuing efforts of
the owner of the Property subsequent to the foreclosure to obtain possession of the Property.
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Each of the actions alleges the same core of operative facts and seeks to assert the same primary
rights with the same or slightly different theories of relief. Each of the actions has been
dismissed with prejudice. Accordingly, there is an adequate record for review of the order.
3. Substantive Findings About Frivolous or Harassing Nature of Plaintiff’s Litigation.
The third De Long factor goes “to the heart of the vexatious litigant analysis.” Molski,
500 F.3d at 1059. The court must make “substantive finds as to the frivolous or harassing nature
of the litigant’s actioins.” De Long, 912 F.2d at 1148 (quoting In re Powell, 851 F.2d 427, 431
(D.C. Cir. 1988)). In so doing, the court must evaluate “’both the number and content of the
filings as indicia’ of the frivolousness of the litigant’s claims.” Id. Alternatively, the third De
Long factor is satisfied if the evidence supports a finding of harassment. De Long, 912 F.2d at
1148. With respect to this element, the Safir factors apply. See Molski, 500 F.3d at 1058.
a. Krage’s History of Litigation, Especially Those That Were Vexatious, Harassing,
or and Duplicative.
Krage’s three adversary proceedings filed in this bankruptcy case and the State Court
Action involve essentially the same claims against the same defendants or successors thereto.
Krage continually challenges the validity of the underlying foreclosure sale, the subsequent
eviction proceedings and asserts a claim of forcible detainer and entry. The court finds that in
filing the present action, Krage violated clear principles of res judicata and collateral estoppel.
All of the counts in Krage’s present action have already been litigated to final judgment. They
also fail to state a claim upon which relief may be granted. By continuing to file actions that
repeat allegations that have already been decided against him, the court finds that Krage has used
the state and federal court to harass Defendants.
b. Krage’s Motive in Pursuing the Litigation.
Courts have found that plaintiffs “repeatedly assert[ing] the same claims in slightly
altered guise” have used the courts to hinder the defendants in some manner. Safir, 792 F.2d at
24. The court finds that Krage’s motive in filing the cases was to hinder Defendants from
enforcing their right to possession of the Property following the foreclosure sale. Krage
improperly filed actions in this court that raised matters that were already adjudicated by the
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state court. Specifically, the State Court Action was dismissed without leave to amend,
constituting a decision on the merits and barring a second action on the same facts. Krage
continues to try to relitigate the alleged wrongful foreclosure and eviction proceedings in this
court despite the court’s dismissal with prejudice of each of the prior adversary proceedings.
Also informative is whether the litigant had an objective, good faith expectation of
prevailing. Safir, 792 F.2d at 24. From an objective standpoint, Krage could not have had an
expectation of prevailing in this case. This court has dismissed two prior adversary proceedings
based on the same facts with prejudice. Krage could not in good faith have expected a different
outcome this time around. The court finds that Krage’s motive in filing this suit is improper.
c. Whether Krage is Represented by Counsel.
Krage’s suits are all brought in pro se. Generally, courts must give some deference to pro
se litigants. Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per curiam) (“A document filed pro se
‘is to be liberally construed,’ and ‘a pro se complaint, however inartfully pleaded, must be held
to less stringent standards than formal pleadings drafted by lawyers.’” (citation omitted)).
However, a court must not tolerate an abuse of the judicial process so flagrant that it permits one
individual to preempt the use of judicial resources that might otherwise be devoted to
adjudicating the meritorious claims of other litigants. See De Long, 912 F.2d at 1148. That is
the case here.
d. Whether Krage has Caused Unnecessary Expense to the Parties or Placed a
Needless Burden on the Courts.
Krage has filed duplicative complaints against the same defendants or their successors
without a proper legal basis for doing so and in a manner that imposed needless expense on
Defendants. Krage’s actions have forced Defendants to undertake unnecessary expense to
defend themselves from baseless claims. This court has expended considerable time and effort
reviewing and ruling on motions seeking dismissal of these claims under Rule 12(b)(6) and relief
from Krage’s continuing lawsuits. The court finds that Krage has caused unnecessary expense to
the parties and has placed a needless burden on the courts by continually repeating allegations
that have already been decided against him.
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e. Whether Other Sanctions Would be Adequate to Protect the Court and Other
Parties.
Based on the evidence, Krage is not likely to stop filing actions against Defendants unless
he is appropriately enjoined. Sanctions would be inadequate in serving to protect the parties and
the courts. Further, it is clear that dismissing Krage’s lawsuits does not deter him from bringing
more. Krage shows a lack of respect for the authority of the court’s decisions. Krage has
ignored various final judgments in his case, such as orders dismissing his complaint with
prejudice. Considering Krage’s history in this regard, Krage is likely to continue his practice of
filing lawsuits related to the Property against Defendants. A judgment against Krage on the
merits of this case would be ineffective to stop the abuse. A pre-filing order is necessary to
prevent Krage from harassing Defendants further.
4. The Order is Narrowly Tailored to the Specific Vice Encountered.
The fourth and final factor in the De Long standard is that the pre-filing order must
be narrowly tailored to the vexations litigant’s wrongful behavior. In De Long, the Ninth Circuit
held overbroad an order preventing the plaintiff from filing any suit in a particular district court.
De Long, 912 F.2d at 1148. In O’Loughlin v. Doe, the Ninth Circuit held that an order requiring
a plaintiff to show good cause before making any request to proceed in forma pauperis was not
narrowly tailored. O'Loughlin v. Doe, 920 F.2d 614, 618 (9th Cir. 1990). Likewise, in Moy v.
U.S., the Ninth Circuit held that an order requiring a plaintiff to obtain leave of court to file any
suit was overly broad when the plaintiff had only been highly litigious with one group of
defendants. Moy v. U.S., 906 F.2d 467, 470 (9th Cir. 1990).
In contrast, the Ninth Circuit affirmed an order declaring plaintiff a vexatious litigant in
Molski. There, the district court’s order prevented plaintiff from filing actions under Title III of
the ADA in the Central District of California. Molski, 500 F.3d at 1061. “The order . . .
appropriately cover[ed] only the type of claims [plaintiff] had been filing vexatiously—ADA
claims.” Id. The order did not prevent plaintiff from filing any ADA complaints. Id. “[I]t
merely subject[ed] [plaintiff’s] complaints to an initial screening review by a district judge.” Id.
The Ninth Circuit found that the district court’s pre-filing order was “narrowly tailored because it
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[did] not deny [plaintiff] access to courts on any ADA claim that [was] not frivolous, yet it
add[ed] a valuable layer of protection, which [the Ninth Circuit thought] was warranted, for the
courts and those targeted by[plaintiff’s] claims.” Id. (citation omitted).
In this case, the court finds that Krage is a vexatious litigant and that the proper order
must require Krage to obtain leave of court before filing any further complaint seeking relief
related to the real property located at 9735 Harvard Avenue, Bellflower, California 90706.
B. Krage Will Not Be Required to Post Security to Continue this Litigation.
L.R. 83-8.1 states:
It is the policy of the Court to discourage vexatious litigation and to provide persons who
are subjected to vexatious litigation with security against the costs of defending against
such litigation and appropriate orders to control such litigation. It is the intent of this rule
to augment the inherent power of the Court to control vexatious litigation and nothing in
this rule shall be construed to limit the Court’s inherent power in that regard.
L.R. 83-8.12. L.R. 83-8.2 further states, in pertinent part:
On its own motion or on motion of a party, after opportunity to be heard, the Court may,
at any time, order a party to give security in such amount as the Court determines to be
appropriate to secure the payment of any costs, sanctions or other amounts which may be
awarded against a vexatious litigant, and may make such other orders as are appropriate
to control the conduct of a vexatious litigant. Such orders may include, without
limitation, a directive to the Clerk not to accept further filings from the litigant without
payment of normal filing fees and/or without written authorization from a judge of the
Court or a Magistrate Judge, issued upon such showing of the evidence supporting the
claim as the judge may require.
L.R. 83-8.2. In light of the dismissal of the adversary proceeding at the January 20, 2015
hearing, the court finds that security is not necessary.
2 In this court, “[a] matter not specifically covered by these Local Bankruptcy Rules may be
determined, if possible, by parallel or analogy to the F.R.Civ.P., the FRBP, or the District Court
Rules.” LBR 1001-1(e)(1). Since vexatious litigation in the bankruptcy court is not specifically
covered by a local bankruptcy rule, the court will apply L.R. 83-8.1 through L.R. 83-8.4.
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III. CONCLUSION
For the reasons stated the court will grant Defendants’ motion to declare Krage a
vexatious litigant. The clerk of this court will be ordered not to accept for filing by or on behalf
of Krage any papers that seek relief related to the Property, absent leave of this court. An order
will be entered consistent with this memorandum.
Date: February 10, 2015
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