Colton v. Bank of New York Mellon

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAI‘I
MARY LEE COLTON,
Plaintiff,
vs.
BANK OF NEW YORK MELLON
as Trustee for the Certificate Holders of
CWABS Inc, Asset-Backed Certificates,
Series 2007-11,
Defendant.
Civil No. 26-00020 MWJS-WRP
ORDER (1) DISMISSING FIRST
AMENDED COMPLAINT AND (2)
GRANTING FURTHER LEAVE TO
AMEND
INTRODUCTION
In an earlier order, this court granted Colton’s application to proceed in forma
pauperis (“IFP”), dismissed her complaint for lack of subject matter jurisdiction, and
granted leave to amend. Colton v. Bank of New York Mellon as Trustee for Certificate
Holders of CWABS Inc, Asset-Backed Certificates, Series 2007-11, Civ. No. 26-00020-MWJS-
WRP, 2026 WL 498395 (D. Haw. Feb. 23, 2026). Colton has availed herself of that leave
by filing a First Amended Complaint, or “FAC.” The FAC, however, continues to suffer
from legal deficiencies. The court therefore DISMISSES the FAC, but grants Colton a
further opportunity to amend her pleadings.
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BACKGROUND
The FAC, together with its several exhibits, spans 326 pages. Dkt. Nos. 25, 28. It
alleges that Colton has “spent 18 years of her life caught in an empiric network of
foreclosure bias from [Defendant Bank of New York Mellon, or “BONYM”] who has
pursued foreclosure 18 years without establishing lawful standing.” Id. at PageID.51.
She clarifies that she has been litigating a foreclosure matter in Hawai‘i state court for
18 years, and claims that the state court “history includes two Orders of Dismissal in
2015 and in 2022 and three prior [Hawai‘i Intermediate Court of Appeals, or “ICA”]
vacaturs showing repeated appellate court rulings that confirm a lack of Defendant’s
standing. Id. at PageID.52. And she brings this new federal lawsuit “to seek relief from
ongoing constitutional violations, improper foreclosure practices, misconduct affecting
title to her property and to quiet title in her favor.” Id.
In its earlier screening order, the court dismissed the complaint because it failed
to identify an appropriate basis for this court to exercise subject matter jurisdiction. As
the court there explained, federal question jurisdiction “exists only when a federal
question is presented on the face of the plaintiff’s properly pleaded complaint,” and yet
no such question appeared on the face of Colton’s initial complaint. Colton, 2026 WL
498395, at *2 (cleaned up). The initial complaint “refers in passing to this being a
‘securities-related action,’” but “apart from the suggestion that one of her claims might
be based on a prior settlement of a securities action, Colton does not identify any federal
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securities laws on which she relies.” Id. And “a claim of a breach of a settlement
agreement—even one that resolved prior federal claims—ordinarily is not itself a claim
based on federal law.” Id. The court recognized that “a breach claim can be federal if
the court that took the settlement either (1) incorporated the terms of the settlement
agreement into an order, or (2) expressed retained jurisdiction to enforce it,” the initial
complaint “does not allege that either occurred here.” Id. (cleaned up). And, finally,
“although the complaint asserts that BONYM violated Colton’s constitutional equal
protection and due process rights, these constitutional rights protect only against the
actions of a governmental actor,” which the complaint does not allege BONMY to be.
Id.
The initial complaint also failed adequately to allege the alternative of diversity
jurisdiction, because it did not allege the citizenship either of BONMY or of Colton
herself. Id. at *2‒3.
Colton’s FAC endeavors to address these deficiencies. As to federal question
jurisdiction, the FAC explicitly alleges violations of “the Securities Act of 1933, 15 U.S.C.
§§ 77a et seq., particularly Section 17(a), 15 U.S.C. § 77q(a); and the Securities Exchange
Act of 1934, 15 U.S.C. § 78a et seq., particularly Section 10(b), 15 U.S.C. § 78j(b), and Rule
10b-5, 17 C.F.R. § 240.10b-5.” Dkt. No. 25, at PageID.52-53. It alleges violations of the
federal racketeering statute, 18 U.S.C. § 1961 et seq. And it reasserts constitutional
claims under the Fifth and Fourteenth Amendments, and now explains that this is
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based, not on any assertion that BONYM is a government actor, but instead on
BONYM’s alleged “misuse of state judicial processes and false representations in
foreclosure proceedings that deprived [Colton] of property without fair notice or
opportunity to be heard.” Id. The FAC contends that the court has subject matter
jurisdiction over these constitutional claims under 42 U.S.C. § 1983, alleging that
BONYM’s counsel has conspired with “government officials acting under color of state
law”—principally, it appears, state court judges and officers—to “block [Colton’s]
constitutional protections, harass Plaintiff for approximately 18 years in litigation
lacking a plaintiff with established standing, fail to meet jurisdictional prerequisites in
attempts to take Plaintiff’s property unlawfully, withhold sufficient pre-notice of
hearing location and time, and deny equal protection through conversation of pleadings
without allowing [Colton] a voice before rulings.” Id. at PageID.53.
In addition, Colton alleges that a New York state court—the New York Supreme
Court—“explicitly retained exclusive jurisdiction” when it approved an “$8.5 billion
Countrywide RMBS settlement” apparently in 2011. Id. at PageID.55‒56.
As to diversity jurisdiction, Colton now alleges that she is a citizen of Hawai‘i
and that BONYM is a citizen of New York. And Colton argues that the court should
exercise ancillary or supplemental jurisdiction over her asserted state-law claims (for
which, she contends, New York law should govern). Id. at PageID.53.
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DISCUSSION
The FAC makes efforts to address the deficiencies identified in the initial
complaint, but it suffers from legal deficiencies of its own.
To begin with, although the FAC alleges that a New York state court retained
jurisdiction to enforce a settlement agreement, that would not give a federal court subject
matter jurisdiction to consider any breaches of the agreement. See Synopsys, Inc. v.
Mentor Graphics Corp., No. C 12-5025, 2013 WL 1365946 (N.D. Cal. Apr. 13, 2013)
(explaining that when “a court retains jurisdiction to enforce a settlement agreement,
that court’s jurisdiction over such enforcement is exclusive”). Accordingly, to the extent
the FAC seeks to rely on the New York state court’s retention of jurisdiction as a basis
for federal court jurisdiction, that argument is not persuasive.
But the more detailed factual allegations in the FAC make clear that the focus of
Colton’s lawsuit is the 18 years of (apparently ongoing) litigation in the Hawai‘i state
courts. Colton’s lawsuit names BONYM as a defendant, but alleges that state court
actors have served essentially as unnamed co-conspirators. And on account of this
theory, she brings claims under the federal securities laws, the federal racketeering
statute, and § 1983 (with the participation of state court actors being the basis of
Colton’s allegation that BONYM has conspired with officials acting under color of state
law). Colton alleges that there is a “systemic problem (consistently appearing in all 5
judges the case came before) in the Hawaii State foreclosure procedure,” and that the
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case “shows a need for deep analysis, review and investigation as improvement is
essentially and necessary in the state courts[’] deficient procedure to restore faith back
into the judicial process.” Dkt. No. 25, at PageID.99.
These federal claims ordinarily would vest this court with federal question
jurisdiction. But under the circumstances of this case, Colton’s allegations run into a
significant jurisdictional problem: the Rooker-Feldman doctrine, under which federal
district courts lack subject matter jurisdiction to exercise appellate review of state court
proceedings. See Worldwide Church of God v. McNair, 805 F.2d 888, 890-91 (9th Cir. 1986).
The FAC’s allegations fall squarely within the Rooker-Feldman doctrine: Colton
complains of the decisions and actions of the Hawai‘i state courts, “asserts as a legal
wrong an allegedly erroneous decision by a state court”—indeed, multiple allegedly
erroneous decisions—and “seeks relief from a state court judgment based on that
decision.” Carmona v. Carmona, 603 F.3d 1041, 1050 (9th Cir. 2010) (cleaned up).
Colton devotes a section of the FAC to disputing the applicability of the Rooker-
Feldman doctrine, Dkt. No. 25, at PageID.95‒96, but that argument is not convincing. It
is not enough for Colton to say that she does not ask this court’s “review or reversal of
any final state court judgment.” Id. The question is whether the nature of her claims
would require the court to do so. And in substantial part, they would. Indeed, Colton
herself acknowledges that through this lawsuit, she asks this court to intervene in the
state court proceedings and grant “prospective relief to prevent continued proceedings
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in the absence of jurisdiction.” Id.; see also id. at PageID.98 (alleging that “[a]bsent
federal intervention, [Colton] will continue to suffer irreparable harm through ongoing
proceedings [in state court] premised on void instruments and defective standing”).
Her basis for contending that this prospective relief is appropriate is her claim that state
courts have made improper decisions in the past. But this court does not have appellate
jurisdiction to review those decisions of the state courts, even if done on the way to
considering prospective relief. Under the Rooker-Feldman doctrine, this court “is barred
from deciding not only the issues decided by the state court, but also any other issues
that are ‘inextricably intertwined’ with the state court’s decision.” Ljustina v. Nike, Inc.,
Case No. 2:26-cv-00809, 2026 WL 2012907, at *3 (C.D. Cal. July 9, 2026) (quoting Noel v.
Hall, 341 F.3d 1148, 1158 (9th Cir. 2003)).1
Nor does it matter that, as Colton emphasizes in the FAC, there apparently has
been no final state court decision on the question of BONYM’s “standing.” See, e.g.,
Dkt. No. 25, at PageID.95 (emphasizing that the “state court proceedings have not
resulted in a final judgment resolving the threshold issue of standing, which remains
unresolved after approximately eighteen years of litigation”). The Rooker-Feldman
doctrine applies “not only to final judgments, but also to interlocutory state court
1 	As the FAC acknowledges, Dkt. No. 25, at PageID.95, abstention doctrines might
separately preclude this court from intervening in ongoing state court litigation, but
given that the FAC must be dismissed for independent reasons, the court does not
resolve the abstention issue here.
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decisions.” Santos v. Superior Ct. of Guam, 711 F. App’x 419, 420 (9th Cir. 2018) (cleaned
up). What matters here is that Colton asks this court to review the work of state courts,
not the finality or comprehensiveness of that state court work.
The upshot is that the FAC’s allegations challenging state court actions—which
form the bulk of the FAC—do not fall within this court’s subject matter jurisdiction. To
be sure, the FAC is not limited to those. The FAC goes on to challenge the conduct of
BONYM and its agents during the Hawai‘i state court proceedings, independent of
state court rulings. Viewed liberally, these allegations do not challenge or criticize (and
thus seek this court’s review of) state court actions. Instead, this set of allegations
challenges only BONYM’s statements and other actions in state court. And here Colton
runs up against a further problem: the Noerr-Pennington doctrine, which shields a party
from liability based on its “petitions sent directly to the court in the course of litigation,”
as well as its “conduct incidental to the prosecution of the suit.” Sosa v. DIRECTV, Inc.,
437 F.3d 923, 934-35 (9th Cir. 2006) (quoting Columbia Pictures Indus., Inc. v. Pro. Real
Estate Investors, Inc., 944 F.2d 1525, 1528-29 (9th Cir. 1991), aff’d 508 U.S. 49 (1993)).
Under this doctrine—which is designed to provide breathing space for constitutionally
protected petitioning activity—federal statutes are generally construed not to extend
liability to statements made to courts during litigation, unless the lawsuit at issue is a
sham. Id. at 931-32; see also id. at 931 (recognizing that the Noerr-Pennington doctrine
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applies not only to the antitrust context, but “applies equally in all contexts” (cleaned
up)).
Although the FAC elaborates on Colton’s belief that BONYM’s litigation efforts
are incorrect and even wrongheaded, the FAC does not offer sufficient factual
allegations to show that BONYM’s litigation efforts were a sham. Litigation efforts fall
to that level only if they are “objectively baseless in the sense that no reasonable litigant
could realistically expect success on the merits.” Pro. Real Estate Investors, Inc. v.
Columbia Pictures Indus., 508 U.S. 49, 60 (1993). The FAC offers no factual basis to reach
that conclusion here. And so the allegations challenging BONYM’s litigation conduct—
though not barred by the Rooker-Feldman doctrine—fail to state a claim for relief. Nor
does it appear likely Colton could meet this standard through further factual
elaboration. Her core contention concerns the interpretation of documents and an
argument that BONYM could not handle her mortgage in the manner it did. See, e.g.,
Dkt. No. 25, at PageID.97 (alleging that a “purported rescission extinguished all rights
in the mortgage and note, thereby voiding any subsequent assignment, including the
2010 Assignment of Mortgage, which is void ab initio and incapable of ratification”). She
appears to suggest that Hawai‘i state courts have not correctly resolved these issues
because “Hawaii trial courts are not experienced in New York securities law
violations.” Id. at PageID.115. Putting aside whether Colton has the better of the
interpretive debate, it is difficult to see how BONYM’s litigation efforts could be so
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objectively baseless that no reasonable litigant could expect them to succeed if, as
Colton implies, a court would need experience with an area of law to reach the correct
rulings. In any event, it suffices to say that the FAC does not offer a factual basis for
reaching that unlikely conclusion.
Perhaps Colton also seeks to challenge BONYM’s conduct outside of the context
of its state court litigation activities. If that is so, the FAC does not supply an adequate
factual foundation for claims of that sort. For the § 1983 claim, the only hook for
government action was the alleged participation of state courts. For Colton’s federal
securities claims, meanwhile, the FAC does not adequately allege that BONYM made
any false or misleading statements or omissions. To meet her pleading burden for these
claims, Colton must satisfy the pleading requirements of Rule 9(b) of the Federal Rules
of Civil Procedure. Oregon Pub. Employees Ret. Fund v. Apollo Grp. Inc., 774 F.3d 598, 605
(9th Cir. 2014) (“Rule 9(b) applies to all elements of a securities fraud action.”). This
means that “[i]n alleging fraud or mistake,” Colton “must state with particularity the
circumstances constituting fraud or mistake.” Id. (quoting Fed. R. Civ. P. 9(b)).
Although the FAC contains a substantial amount of detail, and alleges several
statements that BONYM and its agents are alleged to have made over the years, it does
not allege with particularity that any of these statements were false or misleading. That
is true for all of the FAC’s allegations concerning BONYM’s statements, but it is
especially true for claims made outside of the context of litigation. In short, to the
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extent the FAC seeks to sidestep the Rooker-Feldman and Noerr-Pennington doctrines by
challenging BONYM’s conduct outside of litigation, it has not offered adequate factual
allegations to support any of the FAC’s federal claims.
This leaves Colton’s state law claims. The FAC does supply the basis for
diversity jurisdiction that was lacking in the initial complaint. But here again, the
Rooker-Feldman doctrine precludes this court from exercising jurisdiction to review state
court decisions. That doctrine applies with no less force when the issues on which
review is sought are state law claims rather than federal ones. See Mothershed v. Justs. of
the Sup. Ct., 410 F.3d 602, 607 (9th Cir. 2005), abrogated on other grounds by T.M. v. Univ. of
Md. Med. Sys. Corp., 146 S. Ct. 1739 (2026)). And, to the extent Colton wishes to advance
state law claims that are not dependent upon a review of state court decisions—but
instead based on BONYM’s conduct during state court litigation—the Noerr-Pennington
doctrine applies here with equal force. See, e.g., Bradford Aquatic Grp., LLC v. Condor,
Inc., No. 2:23-CV-09374, 2025 WL 3692143, at *4 & n.5 (C.D. Cal. Sept. 15, 2025) (noting
that Noerr-Pennington “applies equally to federal and state claims” and collection cases).
Finally, to the extent the FAC seeks to show either that BONYM’s state court litigation
was a sham or that it violated state law through conduct outside the context of
litigation, the FAC does not supply adequate factual allegations to support those
conclusions. The state law claims therefore fail, either for lack of subject matter
jurisdiction under the Rooker-Feldman doctrine or for insufficiency of the pleadings.
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* 	* 	*
The remaining question is whether Colton could adequately allege subject matter
jurisdiction or offer sufficient factual allegations to support any of her claims if given a
chance to further amend the complaint. It is a close call, but recognizing that Colton is
proceeding pro se, the court will allow her another opportunity to do so. Any amended
complaint—which should be titled “Second Amended Complaint”—must be filed by
August 15, 2026, and must cure the deficiencies identified above.
Colton is cautioned that failure to timely file a further amended complaint that
addresses the deficiencies identified above will result in the automatic dismissal of this
action.
CONCLUSION
For the foregoing reasons, the court DISMISSES Colton’s FAC and GRANTS
Colton further leave to amend.
If Colton elects to file a further amended complaint, she must comply with the
following requirements:
(1) Colton’s deadline to file a further amended complaint is August 15, 2026;
(2) Colton’s amended complaint should be titled “Second Amended Complaint”;
and
(3) Colton must cure the deficiencies identified above.
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Colton is cautioned that failure to timely file an amended complaint that complies with
this order will result in automatic dismissal of this action.
IT IS SO ORDERED.
DATED: July 15, 2026, at Honolulu, Hawai‘i.
Mary Lee Colton v. Bank of New York Mellon as Trustee for the Certificate Holders of CWABS
Inc, Asset-Backed Certificates, Series 2007-11; Civil No. 26-00020 MWJS-WRP; ORDER (1)
DISMISSING FIRST AMENDED COMPLAINT AND (2) GRANTING FURTHER
LEAVE TO AMEND
/s/ Micah W.J. Smith
Micah W.J. Smith
United States District Judge
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