United States District Court, D. Connecticut
BENSON A. SNAIDER, Plaintiff,
ACCOUNT CONTROL TECH., INC., et al., Defendants.
RULING RE: MOTION TO DISMISS BY ACCOUNT CONTROL
TECHNOLOGY, INC. (DOC. NO. 33) AND MOTION TO DISMISS BY
DEPARTMENT OF ADMINISTRATIVE SERVICES AND CONNECTICUT CLIENT
SECURITY FUND (DOC. NO. 35)
C. Hall United States District Judge
plaintiff, Benson A. Snaider, filed his Amended Complaint on
November 19, 2017, against the defendants Account Control
Technology, Inc. (“ACT”), the Connecticut
Department of Administrative Services (“DAS”),
and the Connecticut Client Security Fund Committee
(“CSF”). See Amended Complaint
(“Am. Compl.”) (Doc. No. 20). In it, Snaider
claims that the defendants violated a discharge injunction he
obtained in Bankruptcy Court and that a state court order of
restitution against him is unenforceable in violation of the
discharge injunction. See id. at ¶¶ 43-51.
filed a Motion to Dismiss the Amended Complaint on January 3,
2018. See Motion to Dismiss Amended Complaint by ACT
(“ACT Mot. to Dismiss”) (Doc. No. 33). DAS and
CSF also filed a joint Motion to Dismiss the Amended
Complaint on the same day. See Motion to Dismiss the
Amended Complaint by DAS and CSF (“DAS/CSF Mot. to
Dismiss”) (Doc. No. 35). The court addresses both
Motions together in this Ruling.
reasons stated below, ACT's Motion to Dismiss is
GRANTED, and the Amended Complaint is
DISMISSED as to all defendants. Because the
court dismisses the Amended Complaint on the grounds stated
in ACT's Motion to Dismiss, which apply equally to all
defendants, the court does not reach all of the arguments in
DAS and CSF's Motion to Dismiss.
Amended Complaint alleges the following facts. Beginning on
April 7, 2004, Snaider represented Minchin Buick, Inc.
(“Minchin”) in negotiations with the City of
Stamford (“the City”) regarding compensation for
a proposed taking of Minchin's property for a public
project. See Am. Compl. at ¶ 7. During
negotiations, the City offered $800, 000, which Minchin
rejected. See id. at ¶ 10. The City then
initiated condemnation proceedings and deposited $800, 000
with the Superior Court, which Snaider deposited in his trust
account. See id. at ¶ 11.
appealed the City's offer and obtained a judgment of
damages of $1, 143, 360 on June 1, 2011. See id. at
¶ 12. The City provided a second check of $469, 553.53,
which Snaider delivered to Minchin on June 6, 2011. See
id. at ¶ 14. Snaider revealed to Minchin that he
did not have the $800, 000 previously deposited. See
id. Minchin then sued Snaider in Stamford Superior Court
and obtained a prejudgment remedy against Snaider. See
id. at ¶ 15. Pursuant to the prejudgment remedy,
Snaider paid Minchin $127, 804.15. See id. at ¶
16. On June 22, 2011, Minchin then filed a claim with CSF,
seeking reimbursement of the $800, 000. See id. at
February 12, 2012, Snaider and his wife filed for Chapter 7
bankruptcy, listing Minchin as a claimant. See id.
at ¶ 18. Minchin's attorney appeared in the
bankruptcy case, but did not object to the dischargeability
of Snaider's debt to Minchin. See id. at ¶
20. The Amended Complaint alleges that therefore
Snaider's debt to Minchin was discharged by the discharge
injunction entered by the Bankruptcy Court on May 30, 2012.
See id. at ¶ 20. Minchin received $18, 705.12
in the final distribution of the bankrupt estate and, on
January 13, 2013, withdrew its case before the Stamford
Superior Court. See id. at ¶¶ 21-22. The
Amended Complaint alleges that the withdrawal of the state
court case prevented Minchin from substantiating its claim
for reimbursement with CSF. See id. at ¶¶
April 11, 2012, Snaider had pleaded guilty to larceny in the
first degree for his embezzlement of Minchin's funds.
See id. at ¶¶ 25-26. He was sentenced to 5
years of probation, execution suspended, and
“restitution for verifiable out of pocket
expenses.” See id. at ¶ 26. On February
28, 2013, Minchin filed a Motion for Determination of
Restitution in order to determine the amount of restitution
and to order payment. See id. at ¶ 27. Sometime
after July 20, 2013, the state court ordered restitution of
$536, 000, payable to CSF. See id. at ¶¶
30, 35. Snaider was ordered to pay $29, 777.79 every month
until January 11, 2017. See id. at ¶ 34. The
Amended Complaint alleges that the sole purpose of the Motion
was to substantiate Minchin's application for payment to
CSF, and that the payment was ordered to be made to CSF as
reimbursement for its payment to Minchin. See id. at
¶¶ 32, 35.
paid only $180 of the $536, 000 restitution. See id.
at ¶ 36. On January 6, 2017, he was served with a Notice
to Appear and Complaint for Violation of Probation for his
failure to complete the restitution payments. See
id. at ¶ 36. Snaider argued that the debt on which
the restitution was based had been previously discharged in
bankruptcy. See id. at ¶ 37. The state court
terminated Snaider's probation upon payment of $2, 000
for reimbursement to CSF and entered a Restitution Order of
$536, 000, payable to CSF, on April 20, 2017. See
id. at ¶ 38.
sent Snaider a letter demanding payment of the $536, 000
restitution on May 10, 2017. See id. at ¶ 39.
ACT then sent Snaider a letter demanding payment of the $536,
000 restitution on June 30, 2017. See id. at ¶
40. ACT also made phone calls to Snaider demanding payment of
the restitution. See id. at ¶ 41.
Amended Complaint, Snaider asserts two claims. Count One
alleges that the three defendants violated the discharge
injunction of the bankruptcy court by attempting to collect
the restitution amount, which Snaider argues was discharged
in bankruptcy. See id. at ¶¶ 43-49. Count
Two alleges that the state court's Restitution Order on
April 20, 2017, is unenforceable because it is enjoined by
the discharge injunction. See id. at ¶¶
50-51. Both Counts appear to be based on section 524 of title
11 of the United States Code. See id. at
¶¶ 44, 48, 51. Snaider seeks relief in the form of
a declaratory judgment that the Restitution Order is void and
unenforceable, an injunction enjoining the defendants from
attempting to collect payment from him, and civil contempt,
costs, and fees pursuant to section 105(a) of title 11 of the
United States Code. See id. at 7.
Lack of Subject Matter Jurisdiction - Rule 12(b)(1)
Federal Rule of Civil Procedure 12(b)(1), “[a] case is
properly dismissed for lack of subject matter jurisdiction .
. . when the district court lacks the statutory or
constitutional power to adjudicate it.” Makarova v.
United States, 201 F.3d 110, 113 (2d Cir. 2000). The
plaintiff bears the burden of proving the existence of
subject matter jurisdiction by a preponderance of the
Failure to State a ...