United States District Court, E.D. Washington
MEMORANDUM OPINION AND ORDER RE: MOTION TO DISMISS
AND MOTION FOR CR 11 SANCTIONS
L. QUACKENBUSH SENIOR UNITED STATES DISTRICT JUDGE
THE COURT is the Defendants' Motion to Dismiss (ECF No.
11) and Defendants' Motion for CR 11 Sanctions (ECF No.
18). After the Motion to Dismiss was filed, the court
directed the parties to address the Rooker-Feldman
doctrine in the Response and Reply briefs because it was not
addressed in the Motion. See (ECF No. 16). The
parties submitted response and reply briefs on both Motions.
This Order memorializes the court's ruling on the
well-pleaded facts are accepted as true for the purposes of
the Motion to Dismiss.
March 13, 2015, the Washington State Supreme Court issued an
order suspending Lori Petersen from the practice of
guardianship for one year. See (ECF No. 1- 1 at
2-3). The Supreme Court also ordered Petersen to
pay costs to the Certified Professional Guardian Board. (ECF
No. 1-1 at 3). The suspension was set to begin on March 20,
2015. (ECF No. 1-1 at 2-3).
March 17, 2015, Spokane County Superior Court Commissioner
Rachelle Anderson sent a letter to Petersen acknowledging
receipt of the Supreme Court order and directing Petersen to
submit a “specific plan as to each individual you
represent” no later than 4:00 p.m. on March 19, 2015.
(ECF No. 1-1 at 5). The letter attached a list of
guardianship cases, some of which were assigned to Petersen,
and others to Hallmark Care Services, Inc.
(“Hallmark”), doing business as Castlemark
Guardianship and Trust (“Castlemark”), and
Hallmark Care Services, Inc., doing business as Eagle
Guardianship and Professional Services (“Eagle”).
(ECF No. 1 at ¶14).
March 18, 2015, attorney John Pierce, representing Petersen,
sent a letter to Commissioner Anderson stating counsel was
filing a motion with the Washington Supreme Court seeking to
stay the suspension for 60 to 90 days. (ECF No. 1-1 at 7).
Counsel's letter disclosed Petersen would be petitioning
the court to transfer her cases to another guardian, but
asserted the process would take “approximately 4-6
weeks.” (ECF No. 1-1 at 7-8). Additionally, counsel
disputed whether cases assigned to Castlemark or Eagle were
subject to the suspension order. (ECF No. 1-1 at 7).
March 26, 2015, the Washington Supreme Court granted a stay
of the suspension to allow Petersen to work with the
Certified Professional Guardian Board to ensure her clients
were properly transferred to another guardian. (ECF No. 1 at
April 1, 2015, Lewis County Superior Court Judge James
Lawler, a member of the Certified Professional Guardian
Board, sent Petersen a letter stating the Board would review
the status of all guardianships associated with Petersen.
(ECF No. 1-1 at 10). The letter directed Petersen to provide
information by April 10, 2015, including: all guardianship
appointments in the name of Lori Petersen, Empire Care,
Castlemark, Hallmark, or Eagle; a plan for compliance with
transferring her cases to another guardian; and information
about every person associated with any guardianship business
where Petersen was a designated guardian or an individual
certified professional guardian. (ECF No. 1-1 at 10-11).
April 1, 2015, Hallmark held a shareholders meeting and
elected a new director, officer, and proxy to ensure Petersen
was not involved in the business during her one year
suspension. (ECF No. 1 at ¶¶22-23). Hallmark also
added another professional guardian. (ECF No. 1 at ¶24).
April 7, 2015, Hallmark received four documents from the
Spokane County Superior Court Guardianship Monitoring Program
Coordinator. (ECF No. 1 at ¶27). The first document was
a letter from Spokane County Superior Court Judge Kathleen
O'Connor addressed to Hallmark stating
“Hallmark/Castlemark/Eagle's ownership is in
question” because the ownership was
“confidential.” (ECF No. 1-1 at 19). Because
ownership had not been disclosed to the court
“[d]espite inquiries on multiple occasions, ” the
letter stated Petersen's association with those agencies
was brought “into question.” (ECF No. 1-1 at 19).
The letter stated “[t]he Court will not appoint as a
successor guardian any certified professional guardian
associated with Hallmark or with entities falling under the
Hallmark umbrella.” (ECF No. 1-1 at 19). Additionally,
the letter stated a special master would be appointed
“to oversee the transition process and individual
guardians ad litem will determine successor guardians.”
(ECF No. 1-1 at 19). Lastly, the letter required Hallmark to
post a $100, 000 surety bond to secure payment of fees. (ECF
No. 1-1 at 19).
second document was a letter from Judge O'Connor to local
certified professional guardians. (ECF No. 1-1 at 21). The
letter disclosed that guardians ad litem would be contacting
the recipients “to take on several cases due to the
recent suspension of CPG Lori Petersen.” (ECF No. 1-1
third document was a letter from Judge O'Connor to local
guardians ad litem informing them the court would be
assigning 125 cases “currently assigned to Ms. Petersen
and/or agencies with which she is involved.” (ECF No.
1-1 at 21).
final document was an Order Appointing Special Master, signed
by Spokane County Superior Court Judge Ellen Kalama Clark for
the 125 cases discussed in the prior letters. (ECF No. 1-1 at
26-32). The Order appointed retired Superior Court Judge Paul
Bastine as special master. (ECF No. 1-1 at 31).
April 7, 2015, attorney Pierce, representing Hallmark, sent a
letter to Judge Lawler in response to the April 1 letter.
(ECF No. 1-1 at 15-17). The letter states Petersen was in the
process of “transferring certain cases” to
Hallmark. (ECF No. 1-1 at 15). The letter stated Hallmark had
moved to be appointed as successor guardian in Petersen's
cases. (ECF No. 1-1 at 15). The letter also referred to
letters and orders from Judge O'Connor and Judge Kalama
Clark. (ECF No. 1-1 at 15-16).
April 17, 2015, Petersen and Hallmark contested the actions
of the Spokane County Superior Court by filing a motion for
reconsideration. (ECF No. 1 at ¶34). The motion for
reconsideration argued the Superior Court: (1) lacked
jurisdiction to expand on the Supreme Court Order suspending
Petersen; (2) lacked authority to order the $100, 000 bond
and appointment of special master; and (3) failed to give
Hallmark due process because it allegedly did not receive
notice or a right to appear and defend against the Order
Appointing Special Master. (ECF No. 1 at ¶34). The
motion also sought clarification of a number of issues
regarding who was presiding over the reassignment of
guardianships and whether there was a hearing that led to the
Order Appointing Special Master. (ECF No. 1 at ¶35).
4, 2015, Spokane County Superior Court Commissioners held a
hearing wherein Petersen and Hallmark were removed as
guardians of record. (ECF No. 1 at ¶36). Counsel for
Hallmark and Petersen was present at the hearing and objected
to the removal of his clients in each of the cases. (ECF No.
1 at ¶¶38-39).
8, 2015, a deputy prosecutor from the Spokane County
Prosecutor's Office entered a limited notice of
appearance on behalf of the Spokane County Superior Court.
(ECF No. 1 at ¶42). The deputy prosecutor then filed a
memorandum in support of the court's Order and ...