United States District Court, E.D. Michigan, Southern Division
OPINION AND ORDER GRANTING IN PART AND DENYING IN
PART MOTION FOR SUMMARY JUDGMENT [#9], GRANTING IN PART AND
DENYING IN PART MOTION TO DISMISS [#13], DENYING MOTION TO
SUPPLEMENT COMPLAINT [#39] AND DISMISSING ACTION
GERSHWIN A. DRAIN UNITED STATES DISTRICT JUDGE
instant action is the Plaintiffs, Sandra and Mitchell Pletos,
' latest attempt to avoid payment of their
homeowners' association fees. Dissatisfied with the state
courts resolution of Plaintiffs' previous lawsuit against
their homeowners association, Plaintiffs filed the instant
action claiming that the homeowners association and its
counsel committed various violations of the Fair Debt
Collection Practices Act, 15 U.S.C. § 1692 et
seq. (“FDCPA”), the Michigan Regulation of
Collection Practices Act, Mich. Comp. Laws § 445.251
et seq. (“MRCPA”) and the Racketeer
Influenced Corrupt Practices Act, 18 U.S.C. § 1961
et seq. (“RICO”) by attempting to
collect on the state court judgment. Plaintiffs also bring
state law claims of abuse of process, criminal enterprise and
before the Court is the Defendants, John Finkelmann's,
and his law firm, Makower Abbate Guerra Wegner Vollmer,
PLLC's (the “Makower Defendants”) Motion to
Dismiss. Also, before the Court is the Defendants, '
Roger Papa, Giovan Agazzi, Danny Landa, Kati Azia and Mike
Desjardines, who are all Board members of the homeowners
association, (the “LWA Defendants”) Motion for
Summary Judgment. These matters are fully briefed and, upon
review of the parties' submissions, the Court concludes
that oral argument will not aid in the disposition of this
matter. Accordingly, the Court will resolve the pending
motions on the submitted briefs. See E.D. Mich. L.R.
Plaintiffs have failed to allege viable federal claims and
the Court declines to exercise supplemental jurisdiction over
Plaintiffs' state law claims, the Court will grant in
part and deny in part the Defendants' present motions and
will dismiss the instant action.
are lot owners in Lake in the Woods, a platted subdivision
located in the Township of Shelby, Macomb County, Michigan.
By virtue of Plaintiffs' lot ownership, they are members
of the Lake in the Woods Association, Inc.
(“LWA”), a Michigan nonprofit corporation. The
governing documents for the LWA are the: (1) Articles of
Incorporation, (2) the Declaration of Easements, Covenants,
Conditions and Restrictions for Lake in the Woods Subdivision
(“DECCR”) and (3) the Bylaws.
IV of the DECCR obligates all lot owners of Lake in the Woods
to pay annual general assessments and special assessments for
capital improvements. Article IV also provides that
“[a]ll annual and special assessments, whether general
or related to the Lake Lots, together with interest, costs
and reasonable attorneys' fees, shall from date of
assessment be a charge and a continuing lien upon the Lot
against which each such assessment is made.” Pg ID 402.
failed to pay assessments from 2005 through April of 2012 and
the LWA recorded a lien in the amount of $1, 295.53 on
Plaintiffs' property. Pletos v. Lake in the Woods
Homeowners Assoc., No. 319087, 2015 WL 1650803, *1
(Mich. Ct. App. Apr. 14, 2015). In January of 2012, the LWA
recorded a second lien on Plaintiffs' property in the
amount of $6, 271.74. Id.
November of 2012, Plaintiffs sued the LWA in the Macomb
County Circuit Court. Plaintiffs alleged fifteen counts,
including violation of the LWA's Bylaws and the DECCR,
violation of the FDCPA, and slander of title. Id.
The LWA hired the Makower Defendants to pursue a counterclaim
against the Plaintiffs. The counterclaim sought unpaid
assessments, interest, late charges, and attorney fees.
Macomb County Circuit Court granted summary disposition in
the LWA's favor on both Plaintiffs' complaint and the
LWA's counterclaim. It held that the LWA followed the
DECCR and the Bylaws, it did not breach its covenants with
Plaintiffs, and that Plaintiffs “failed to prove the
delinquent assessments [were] in error, ” and the LWA
“had the right to file liens to pursue collection of
the delinquent assessments.” See Mot. Summ.
J., Ex. B, Pg ID 798. It further found no violation of the
FDCPA because the LWA was not a “debt collector”
under the Act. After an evidentiary hearing, the court
awarded a $20, 553.64 judgment against Plaintiffs, which
represented unpaid assessments, late fees, interest, costs,
and attorney fees. The court further held that Plaintiffs
were “obligated to pay all additional legal fees that
[the LWA] reasonably incurs in attempting to collect the
aforementioned sums due and owing to [the LWA].”
appealed these decisions and asked the trial court to set an
appeal bond and to stay the proceedings. The Macomb County
Circuit Court granted a stay conditioned on Plaintiffs
posting a $25, 000.00 bond within fourteen (14) days of the
Michigan Court of Appeals affirmed the Macomb County Circuit
Court's decisions in an unpublished opinion. Pletos
v. Lake in the Woods Homeowners Assoc., No.
319087, 2015 WL 1650803, *1 (Mich. Ct. App. Apr. 14, 2015).
Thereafter, Plaintiffs moved for leave to appeal this
decision to the Michigan Supreme Court, which was denied.
to the denial of leave by the Michigan Supreme Court, the LWA
received a letter from Plaintiff Sandra Pletos. Mrs.
Pletos' letter requested review of certain LWA documents.
On February 5, 2016, Defendant Finkelman sent email
correspondence to Plaintiffs' counsel and asked if it
would be appropriate for him to respond to Plaintiffs
directly on behalf of the LWA. First Am. Compl., Ex. 13 at Pg
ID 483. Plaintiffs' counsel responded to Finkelmann's
letter in relevant part:
First of all, as an Association member, she has the right to
whatever she asked for. No attorney should be necessary for
that communication. As a result, when they calculate dues,
please do not charge the Association for your fees so
needlessly incurred. Except for the 1/10 of an hour it costs
to give the appropriate legal advice to hand over the
The Association should be communicating with Mrs. Pletos
directly. Tell them to put on their big boy pants and play
the part of Association members like they are obligated to
Id. On February 12, 2016, Defendant Finkelmann sent
a letter to Plaintiffs regarding Mrs. Pletos' letter
requesting review of certain LWA documents. Id., Ex.
17 at Pg ID 495.
February 25, 2016, the LWA sent Plaintiffs Invoice Number
2016-007, which stated that Plaintiffs owed the following to
12/31/15 Account Balance:
12/31/15 Account Balance:
Legal Fees 1/1/16 to 1/31/16
Late Fees 1/1/16 to 1/31/16
Interest 1/1/16 to 1/31/16
Total Amount Due 2/29/16:
February 26, 2016, the Plaintiffs sent a letter to the LWA
indicating that Invoice Number 2016-007 was invalid for a
variety of reasons. Id., Ex. 19 at Pg ID 503. In
their letter, the Plaintiffs asserted that the election of
the LWA Directors was illegal, and that the Directors and
Officers of the LWA have committed fraud and other purported
abuses. Id. These complaints are identical to those
addressed and resolved by the Macomb County Circuit Court and
affirmed by the Michigan Court of Appeals.
on February 26, 2016, Plaintiffs responded to Defendant
Finkelmann's February 12, 2016 letter. Plaintiffs again
raised a series of complaints concerning the identity of the
Directors and Officers of the LWA, whether the Makower
Defendants were authorized to act on behalf of the LWA, and
the LWA's refusal to permit document inspection and
financial review. Id., Ex. 20 Pg ID 509-10.
the Michigan Supreme Court denied leave to appeal, the
Makower Defendants sent correspondence to Plaintiffs'
counsel concerning the outstanding balance due on the state
court judgment on April 1, 2016. Id., Ex. 22 at Pg
ID 126-27. His letter states in relevant part:
As you probably are aware at this point, the Supreme Court
declined the application for leave on this matter. As a
result, I believe that it would be appropriate for the
Pletos' to pay the outstanding balance. I understand that
the Association's records show an amount due that is much
higher than the $25, 000 bond, but we can start with the Bond
amount in my opinion, and determine what's to be done
regarding any subsequent amount.
Please let me know if you will reach out to your clients
regarding payment of the bond amount to the Association at
this time. If I don't hear back from you in the next
week, I'll contact the Bond Company regarding this
matter. Thank you.
Plaintiffs' counsel responded on April 2, 2016 stating:
No, I was not aware as nothing has appeared at my office.
Nevertheless, I looked it up and you are correct ...