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Hallmark Care Services, Inc. v. Superior Court of State of Washington for Spokane County

United States District Court, E.D. Washington

June 28, 2019

HALLMARK CARE SERVICES, INC., a Washington corporation, d.b.a. CASTLEMARK GUARDIANSHIP AND TRUSTS d.b.a. EAGLE GUARDIANSHIP, LORI PETERSEN, and KERRI SANDIFER, Plaintiffs,
v.
SUPERIOR COURT OF THE STATE OF WASHINGTON FOR SPOKANE COUNTY; SPOKANE COUNTY, WASHINGTON, a political subdivision; PAUL ARTHUR BASTINE; and ANA KEMMERER, Defendants.

          ORDER DENYING PLAINTIFFS' MOTION FOR SUMMARY JUDGMENT AND GRANTING DEFENDANTS' CROSS-MOTION FOR SUMMARY JUDGMENT

          THOMAS O. RICE CHIEF UNITED STATES DISTRICT JUDGE.

         BEFORE THE COURT is Plaintiffs' Motion for Partial Summary Judgment (ECF No. 10), Defendants' Cross-Motion for Summary Judgment (ECF No. 19), and Plaintiff's Motion for Order Vacating Judgments (ECF No. 29). These matters were submitted for consideration without oral argument. The Court has reviewed the record and files herein, and is fully informed. For reasons discussed below, the Court DENIES Plaintiffs' Motion for Partial Summary Judgment (ECF No. 10) and GRANTS Defendants' Cross-Motion for Summary Judgment (ECF No. 19). Plaintiff's Motion for Order Vacating Judgments (ECF No. 29) is DENIED as moot.

         FACTS

         This case arises out of the one-year disciplinary suspension of Lori Petersen, a certified professional guardian (“CPG”). The following facts are undisputed unless otherwise noted.

         On March 13, 2015, the Washington Supreme Court issued an order affirming the Certified Professional Guardian Board's (“CPG Board”) one-year suspension of Ms. Petersen. ECF No. 1-8 at 4, ¶ 13. The Supreme Court also ordered Ms. Petersen to pay costs to the CGP Board in the amount of $7, 500.00. See ECF No. 8-1 at 5. At the time of the Supreme Court's order, Ms. Petersen operated as a CPG doing business as Empire Care Services or Empire Care and Guardianship (“Empire”), was also an employee of Hallmark Care Services, Inc. (“Hallmark”) and served as a designated CPG for two CPG agencies operated by Hallmark: Castlemark Guardianship and Trust (“Castlemark”), and Eagle Guardianship and Professional Services (“Eagle”). Id. at 914-15. On March 26, 2015, the Washington Supreme Court granted a stay of the suspension to allow Ms. Petersen to work with the CGP Board to ensure her clients were properly transferred to successor certified guardians. Id. at 5, ¶ 21.

         Thereafter, the Spokane County Superior Court undertook judicial review not only of cases in which Ms. Petersen served as guardian, but also the cases assigned to Hallmark, Castlemark, and Eagle. Id. at 7-8, ¶¶ 31-34. On April 7, 2015, Spokane County Superior Court Judge Kathleen O'Connor wrote to Defendants' counsel to inform him that Ms. Petersen's cases, as well as cases associated with Hallmark/Castlemark/Empire, would be transitioned to successor guardians. ECF No. 11 at 6, ¶ 17. That same day, Spokane County Superior Court Judge Ellen Clark signed an order appointing Defendant Paul Bastine (“Bastine”) as special master to oversee the transition to and appointment of successor guardians. Id. at 7, ¶¶19-20. Judge O'Connor's letter was mailed to Defendants' counsel by Defendant Ana Kemmerer (“Kemmerer”), in her capacity as Guardianship Monitoring Program Coordinator within the Spokane County Court Administrator's Office, along with a copy of the order appointing the special master and two additional letters from Judge O'Connor-one addressed to GALs in Spokane County and another addressed to CPGs informing them of Ms. Petersen's suspension. Id. at 6-7; see ECF No. 8-1 at 32-45.

         On April 10, 2015, Spokane County Superior Court Commissioner Tony Rugel ordered the appointment of a GAL in each of the 125 guardianship actions. ECF No. 21 at 9. Each GAL was instructed to review the guardianship file and recommend an appropriate successor guardian. Id. In early May 2015, Spokane County Superior Court Commissioners Steven Grovdahl or Tami Chavez held hearings for each of the guardianships. Id. at 9-10. Following the costly proceedings in which successor guardians were appointed for more than 120 cases assigned to Ms. Petersen and the CGP agencies she was involved with, the Spokane Superior Court assessed costs of the procedure against Ms. Petersen, Hallmark, Castlemark, and Eagle. Ms. Petersen and the CPG agencies appealed to the Washington Court of Appeals, challenging (1) their removal as guardians, and (2) the assessment of GAL fees against them.

         On October 18, 2018, Division Three of the Washington Court of Appeals entered an unpublished opinion reversing the money judgments and remanding all 125 cases back to the Spokane County Superior Court for further proceedings consistent with its ruling.[1] See ECF No. 1-8 at 910-34. Because the court commissioner previously determined Ms. Petersen and the CPG agencies lacked standing to appeal their removal as guardians, the only issue on appeal concerned the judgments assessing GAL fees, specifically: “Whether the superior court violated CR 54(f)(2)[2] and Hallmark's and Ms. Petersen's due process rights when it filed judgments requiring Ms. Petersen and Hallmark to reimburse Spokane County for the GAL fees incurred in each of the cases.” Id. at 927. The Court of Appeals held that the “entry of the money judgments violated both CR 54(f)(2) and Ms. Petersen's and Hallmark's right to due process.” Id. at 929. The Court of Appeals then described the proper “procedure on remand, ” which is worth quoting at length:

Because our commissioner has dismissed Ms. Petersen's and Hallmark's challenges to the orders removing her and Hallmark's agencies as guardians, we write further to make clear that in any future proceedings, they are free to challenge the assessment of GAL fees (but not the orders removing them as guardians) on the basis that the replacement process followed by the court was not necessary.
Evidence presented in future proceedings may or may not support the guardian replacement procedure followed by the court and an assessment of fees against Hallmark or Ms. Petersen. We do not prejudge that issue, but want to be clear that our commissioner's decision that the guardian replacement decisions were not before us on appeal does not foreclose Hallmark's challenge to fee assessments based on what it claims was an unnecessary guardian removal procedure. We reverse the money judgments only, and remand for further proceedings consistent with this opinion.
We retain jurisdiction to avoid the administrative inconvenience to the courts and the parties that would be presented should the conduct of further hearings result in over 120 new appeals.

Id. at 20, 24-25.

         On March 6, 2019, Plaintiffs filed a collateral and independent Complaint against the Spokane County Superior Court and Spokane County seeking to effectuate the Court of Appeals decision and also seeking damages. ECF No. 1-5 at 1-63 (cause number 19201029-32). On March 18, 2019, Plaintiffs filed an Amended Complaint adding Defendants Paul Bastine (the court appointed Special Master) and Ana Kemmerer (the Guardianship Monitoring Program Coordinator). ECF No. 1-8. Inexplicably in this separate lawsuit, Plaintiffs seek an order to effectuate the Court of Appeals' decision (“[v]acating all money judgments in each of the [remanded] guardianship cases consistent with the ruling by the Court of Appeals”) and damages related to the allegedly unconstitutional and unlawful money judgments. See ECF No. 1-8 at 1-892. Because the Amended Complaint sought damages under the Fourteenth Amendment to the United States Constitution, Defendants filed a petition to remove the case from state court to federal court on April 1, 2019. ECF Nos. 1; 1-1. In the meantime, Plaintiffs apparently added another purported Plaintiff, Kerri Sandifer, by filing a second amended “Complaint Joinder of Party and Claims” on April 1, 2019. ECF No. 7 at 11-22.

         On April 24, 2019, Plaintiffs filed a motion to remand this case back to state court. ECF No. 7. The Court denied the motion on May 31, 2019, holding that Plaintiffs' Complaint and the second amendment to ...


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