Cupp v. Plastiras

Background

Ronald Cupp sued Basil Plastiras, Michael Terrizzi, Plastiras & Terrizzi, APC, and Parkway Properties 12 LLC. His claims arose from a monetary judgment that defendants obtained against him in Sonoma County Superior Court in 2013. Cupp later filed a Chapter 7 bankruptcy petition. The bankruptcy court issued a discharge and final decree on March 18, 2014, notified defendants, and closed the bankruptcy case.

In 2022, defendants sought to renew the monetary judgment. The Sonoma County Superior Court renewed and updated the judgment, and defendants recorded the document. Cupp alleged that he discovered the recorded judgment in 2024 while speaking with a prospective buyer for his property and attempting to obtain a loan. Proceeding without an attorney, he filed seven causes of action: violation of 11 U.S.C. § 362; violation of the Fair Debt Collection Practices Act; slander of title; quiet title and cancellation of instruments; violation of California’s Rosenthal Fair Debt Collection Practices Act; intentional infliction of emotional distress; and defamation.

Defendants moved under Federal Rule of Civil Procedure 12(b)(6), which allows dismissal for failure to state a claim. They also moved under Rule 12(b)(1), which concerns subject-matter jurisdiction, as to the quiet-title and cancellation-of-instruments claim, arguing that it was moot.

Federal Claims

The court dismissed Cupp’s claim under 11 U.S.C. § 362. That statute governs the automatic stay in bankruptcy. The court explained that, under § 362(c)(2), the stay ends when a Chapter 7 discharge is granted or denied. Because Cupp alleged that the bankruptcy court granted his discharge on March 18, 2014, the stay had ended before defendants renewed the judgment. Cupp conceded this point at oral argument, and the court dismissed the claim.

Cupp argued that he could amend his complaint to assert a claim under 11 U.S.C. § 524, which creates an injunction relating to a bankruptcy discharge. The court ruled that amendment would be futile because Ninth Circuit law holds that § 524 does not provide a private right of action. The court stated that an alleged violation of the discharge injunction must be pursued through contempt remedies in the bankruptcy court, and Cupp conceded that point at oral argument.

The court also dismissed Cupp’s Fair Debt Collection Practices Act claim without prejudice to seeking relief in bankruptcy court. The court determined that the claim was based on the alleged violation of the bankruptcy discharge order. Under the cited Ninth Circuit precedent, a debtor’s protection and remedy for that type of alleged violation remain under the Bankruptcy Code rather than through a simultaneous Fair Debt Collection Practices Act claim.

State Claims and Disposition

Cupp’s remaining claims were state-law claims for slander of title; quiet title and cancellation of instruments; violation of California’s Rosenthal Fair Debt Collection Practices Act; intentional infliction of emotional distress; and defamation. After dismissing the federal claims, the court declined to exercise supplemental jurisdiction, meaning jurisdiction over related state claims, because the case was at an early stage and discovery had not occurred. The court also noted differences between state and federal procedures concerning an anti-SLAPP motion.

The court dismissed the state-law claims without prejudice to renewal in state court. It granted defendants’ motion to dismiss and stated that the claims were dismissed without prejudice to renewal in the proper forums. The order disposed of Docket Nos. 30, 33, and 34.