United States District Court, D. New Mexico
STATE OF NEW MEXICO, ex rel., HECTOR BALDERAS, Attorney General of New Mexico, Plaintiff,
REAL ESTATE LAW CENTER, P.C., a California professional corporation; ERIKSON M. DAVIS, an attorney and resident of California, individually, and dba Real Estate Law Center, P.C., a California professional corporation; DEEPAK S. PARWATIKAR, an attorney and resident of California, individually, and dba Balanced Legal Group, an unidentified trade name or entity, dba www.pinnaclelawcenter.com; CHAD T. PRATT, an attorney and resident of California, individually, and formerly dba Real Estate Law Center, P.C.; the BALANCED LEGAL GROUP, an unidentified trade name or entity located in California, and PINNACLE LAW CENTER, P.C., a California professional corporation, Defendants.
H. Balderas Attorney General of the State of New Mexico
Angelica Anaya-Allen Assistant Attorney General of the State
of New Mexico Santa Fe, New Mexico Attorneys for the
J. Kennedy Jessica M. Hernandez Elizabeth Harrison Kennedy,
Hernandez & Associates, P.C. Albuquerque, New Mexico
Attorneys for Defendants Pinnacle Law Center, PC, Balanced
Legal Group, and Deepak S. Parwatikar.
Erikson M. Davis Newbury Park, California Defendant pro se.
Thomas Pratt Los Angeles, California Defendant pro se.
Estate Law Center, PC California Defendant pro se.
MEMORANDUM OPINION AND ORDER
MATTER comes before the Court on the Motion to Continue Trial
by Pro Per Chad T-W Pratt, Sr. to Exclude All, filed July 8,
2019 (Doc. 189)(“Motion”). The Court held a
hearing on July 10, 2019. See Transcript of Trial
Proceedings at 489:1-498:13 (dated July 10, 2019), filed July
15, 2019 (Doc. 195)(“July 10 Tr.”). The primary
issues are whether the Court should continue the trial
because: (i) Plaintiff State of New Mexico filed late its
Plaintiff's Trial Exhibit List, filed June 28, 2019 (Doc.
169)(“Exhibit List”); (ii) Defendant Chad T.
Pratt will receive the Plaintiff's Amended Trial Exhibit
List, filed June 28, 2019 (Doc. 172), by mail after the trial
commences; (iii) New Mexico has not provided Mr. Pratt
requested information on mortgage files, foreclosure
judgments, and evidence of the alleged Mortgage Assistance
Relief Services (MARS) Rule, 12 C.F.R. 1015.1
“Regulation O, ” violations; (iv) New Mexico has
not responded to Mr. Pratt's settlement offers; (v) Mr.
Pratt is waiting for telephone call responses from the
Court's Courtroom Deputy; and (vi) Mr. Pratt does not
have copies of the Court's rulings on the Defendant
Deepak S. Parwatikar's Motion for Summary Judgment, filed
April 25, 2019 (Doc. 132)(“MSJ”), or on the
Defendant Chad T-W Pratt's Brief in Support of Motion to
Dismiss for Improper Venue and/or In The Alternative Transfer
to Los Angeles, filed March, 142019 (Doc.113)(“Venue
Motion”). As none of Mr. Pratt's arguments provide
sound grounds for continuing the trial, the Court denies the
Court takes its facts from the Complaint for Violations of
the New Mexico Mortgage Foreclosure Consultant Fraud
Prevention Act (MFCFPA), MARS Rule, the New Mexico Unfair
Practices Act (NMUPA) and Petition for Injunctive Relief,
filed February 22, 2017 (Doc. 1)(“Complaint”).
The Court provides these facts for background. It does not
adopt them as the truth, and it recognizes that these facts
are largely New Mexico's version of events.
action arises from the activities of Defendants Real Estate
Law Center, P.C.; Erikson M. Davis; Deepak S. Parwatikar;
Balanced Legal Group; and Pinnacle Law Center, P.C., and Mr.
Pratt. See Complaint ¶¶ 9-15, at 4-5. Mr.
Davis, Mr. Pratt, and Mr. Parwatikar are residents of the
State of California, and Mr. Pratt and Mr. Parwatikar are
attorneys licensed in the State of California. See
Complaint ¶¶ 10-12, at 4-5. Neither Mr. Davis nor
Mr. Pratt is licensed to practice law in New Mexico.
See Complaint ¶¶ 10-11, at 4-5. Real
Estate Law and Pinnacle Law are “Professional
Corporation[s] registered in California.” Complaint
¶¶ 9, 13 at 4-5. Balanced Legal “is a
California law firm owned and/or managed by
Parwatikar.” Complaint ¶ 14, at 5.
Pratt owned and managed Real Estate Law from September, 2011,
to September, 2013. See Complaint ¶ 37, at 8.
Mr. Davis “assumed ownership of” Real Estate Law
in 2013. Complaint ¶ 20, at 6. Real Estate Law
“has an operating agreement or partnership agreement
with Parwatikar and Pinnacle, ” which Mr. Parwatikar
owns, Complaint ¶ 38, at 8; see id. ¶ 21,
at 6, and Real Estate Law pays Pinnacle Law eighty percent of
the fees that Real Estate Law receives, see
Complaint ¶ 21, at 6. Balanced Legal “uses”
the same address -- 695 S. Vermont Ave., Los Angeles,
California 90010 -- as Real Estate Law and Pinnacle Law use.
Complaint ¶ 34, at 8.
Estate Law provides “legal representation, mortgage
foreclosure consulting and mortgage modification services to
homeowners in New Mexico although RELC and its attorneys are
not licensed to practice law in New Mexico.” Complaint
¶ 16, at 5. “[Real Estate Law] has made direct
telephone solicitations to New Mexico consumers and has
advertised its services in filing mass joinder lawsuits and
mortgage modifications.” Complaint ¶ 17, at 5.
“[Real Estate Law] has filed dozens of frivolous mass
joinder lawsuits against a variety of banks, enticing
hundreds of homeowners, including at least 23 New Mexico
homeowners, to join these lawsuits as a way to obtain better
loan terms.” Complaint ¶ 18, at 5. The Defendants
“created the fiction of . . . mass action joinder
lawsuits to disguise . . . advance fees as legal fees.”
Complaint ¶ 23, at 6. Balanced Legal “offers legal
services including loan modification and bankruptcy
services” via a website “accessible to New Mexico
consumers.” Complaint ¶ 33, at 7-8.
On its website, Balanced says, in close proximity to the
words “LOWER YOUR MORTGAGE PAYMENTS TODAY!!” that
“[w]e work with litigation firms that sue lenders in
individual or mass tort cases. Potential results of lawsuits
can include but not limited to the following: -- Principal
reduction -- Monetary damages -- Lowered interest rates.
Cancellation of the loan if severe fraud was present”.
Complaint ¶ 35, at 8 (emphasis and alteration in
Pratt faced disciplinary charges from the State Bar of
California in November, 2013, “for (among other things)
allowing non-attorney staff to practice law, making false
statements to entice clients to retain RELC, failing to
return un-earned fees, and for bringing ‘meritless'
lawsuits for consumers.” Complaint ¶ 39, at 8.
“The charges against Pratt resulted in a State Bar
Court of California decision ordering one year suspension,
three years' probation and restitution to certain
consumers.” Complaint ¶ 40, at 8.
Mexico contends that: (i) the Defendants violated the MARS
rule by accepting advance payment for mortgage relief
services, and/or Mr. Parwatikar and Pinnacle Law
substantially assisted the violations, see Complaint
¶¶ 77-85, at 18-19; (ii) the Defendants, willfully
and in bad faith, violated the New Mexico Mortgage
Foreclosure Consultant Fraud Prevention Act, N.M. Stat. Ann.
§§ 47-15-1 to -8 (“MFCFPA”), by failing
to provide required warnings, notices, and disclosures, by
failing to give New Mexico homeowners twenty-four hours
before signing attorney-client agreements, and by requiring
advance payment for their services, see Complaint
¶¶ 86-101, at 19-22; and (iii) the Defendants
knowingly engaged in unlawful conduct violating the NMPUA,
N.M. Stat. Ann. §§ 57-12-1 to -26, by requiring
advance fees and monthly maintenance fees while filing sham
lawsuits, by leading New Mexico consumers to believe that the
Defendants performed valuable legal services when the
Defendants filed sham lawsuits with no value for New Mexico
consumers, and by allowing New Mexico consumers to believe
that the Defendants will defend foreclosure lawsuits,
see Complaint ¶¶ 102-08, at 22-23. New
Mexico asks that the Court enjoin the Defendants from
continuing such violations, see Complaint
¶¶ 109-11, G, at 23-24, and requests restitution,
disgorgement, civil penalties, and costs as the MARS Rule,
the MFCFPA, and the NMUPA permit, see Complaint
¶¶ A-F, at 24.
Parwatikar Defendants -- Mr. Parwatikar, Balanced Legal, and
Pinnacle Law -- and Mr. Pratt are the only Defendants with
liability issues remaining in this case. On June 11, 2018,
the Court entered a default judgment against Real Estate Law
on all liability issues, “reserving the issues of
relief, including disgorgement, restitution and civil
penalties.” Default Judgment Against Real Estate Law
Center at 1, filed June 11, 2018 (Doc. 75). See id.
at 1-2. On November 5, 2018, the Honorable Laura Fashing,
United States Magistrate Judge for the United States District
Court for the District of New Mexico, recommended entering a
default judgment against Mr. Davis on issues of liability,
reserving for litigation the issues of relief, see
Proposed Findings and Recommended Disposition at 4, filed
November 5, 2018 (Doc. 91), and, on January 18, 2019, the
Court adopted Magistrate Judge Fashing's recommendation,
see Memorandum Opinion and Order Adopting the
Magistrate Judge's Proposed Findings and Recommended
Disposition at 2, 9, 2019 WL 259121, at *1, *4, filed January
18, 2019 (Doc. 106). In the Memorandum Opinion and Order,
filed July 2, 2019 (Doc. 183)(“MSJ MOO”), the
Court granted summary judgment for the Parwatikar Defendants
and Mr. Pratt on New Mexico's NMUPA claims, injunctive
relief claims, and theories based on: (i) Mr. Davis'
alleged MARS Rule violations; (ii) Balanced Legal's and
Pinnacle Law's violation of the MARS Rule independent of
Real Estate Law; (iii) Mr. Parwatikar's and Mr.
Pratt's participation in a common enterprise with Real
Estate Law, Balanced Legal, and Pinnacle Law; and (iv) Mr.
Pratt's reckless or knowing violation of the MARS Rule,
or willful violation of the MFCFPA. See MSJ MOO at
183-84, 2019 WL 2804575, at *68.
Pratt filed the Motion on July 8, 2019. See Motion
at 1. Mr. Pratt complains in the Motion: “New Mexico
filed their exhibit list LATE and was allowed relief per
motion Without notice.” Motion at 1 (capitalization in
original). Mr. Pratt then argues:
New Mexico now files amended exhibit list with NEW exhibits
200-231 NEVER SEEN BEFORE by Pratt. The mail service of such
amended exhibit list Shall be received by PRATT after trial
commences . . . This is the ultimate in
“sandbagging” and Prejudice to PRATT. The
“strike zone” seems to be very wide for new
mexico, and the “goal posts” keep getting moved
so that PRATT cannot prepare for trial.
Indeed, it is impossible for PRATT to prepare for trial given
this “discovery dump” of new evidence!
at 1 (quoting Balanced Legal Group,
http://www.balancedlegalgroup.com (no longer available as of
December 1, 2019)(capitalization in original)). Mr. Pratt
continues: “Most importantly, New Mexico has failed to
provide ALL of the following, despite Repeated requests: (i)
mortgage files on all plaintiffs adverse to PRATT; (ii)
foreclosure judgments on all plaintiffs adverse to PRATT;
(iii) documentary evidence of ‘MARS' acts by PRATT
as to plaintiffs.” Motion at 2 (capitalization in
original). Mr. Pratt then lists several more complaints
regarding the Court and New Mexico:
PRATT has made settlement offer(s) to New Mexico, without
PRATT phoned and left TWO MESSAGES with court scheduling
motion clerk in NOVEMBER 2018, and is awaiting
“call-back” on setting of motion(s).
PRATT does NOT have copy of any ruling(s) on defense MSJ
(motion for summary judgment) or ...