Seventh Circuit Divides Over Whether There Is a “Corruption” Exception to the Rooker-Feldman Doctrine

In Hadzi-Tanovic v. Johnson, No. 21-3373 (7th Cir. Mar. 14, 2023), the Seventh Circuit overrules (over a two-judge dissent) prior panel decisions holding that a plaintiff can avoid the operation of the RookerFeldman doctrine by alleging that the state-court judgment was the product of corruption.

“This case arises out of a custody dispute between plaintiff Aneta Hadzi-Tanovic and her former husband, defendant Slobodan Pavlovich, in an Illinois state court. After the state court issued an order requiring that Hadzi-Tanovic’s parenting time with her children be supervised, she filed this action in federal court. She brings claims under 42 U.S.C. §§ 1983 and 1985 against her ex-husband, the children’s guardian ad litem, and the state court judge. She alleges the three conspired to violate her and her children’s rights to family association and her right to a fair and unbiased trier of fact.”

RookerFeldman bars federal-court jurisdiction over claims that challenge final state-court judgments. The doctrine is limited to federal claims that “‘directly’ challenge a state court judgment or are ‘inextricably intertwined with one.’” Federal claims are deemed “inextricably intertwined” with the state court judgment where the plaintiff alleges an injury “caused by the state court judgment.”

The district court here held that Rooker-Feldman did not apply to Hadzi-Tanovic’s suit. “First, the court questioned whether Hadzi-Tanovic’s suit concerned a final order, as Rooker-Feldman requires, given both the state court’s ongoing supervision of custody and child support arrangements and her pending motion for relief from the June 13, 2018 order. Second, relying on this court’s decisions in Nesses v. Shepard, 68 F.3d 1003 (7th Cir. 1995), and Loubser v. Thacker, 440 F.3d 439 (7th Cir. 2006), the court concluded that Rooker-Feldman did not bar Hadzi-Tanovic’s suit because she alleged corruption in the state court proceedings.” (The court nevertheless dismissed the case on abstention grounds.)

The Seventh Circuit holds, though, that Rooker-Feldman does apply and uses the occasion of this case to overrule Nesses and Loubser. (Under Seventh Circuit procedure, a three-judge panel may overrule a prior circuit decision by circulating the opinion among all active circuit judges pursuant to Circuit Rule 40(e).)

The panel first holds that the supervised-visitation order is “final” for Rooker-Feldman purposes, despite that the court continued to supervise visitation. The “order was entered pursuant to the Illinois Marriage and Dissolution of Marriage Act, 750 Ill. Comp. Stat. 5/603.10 . . . . As such, the order was a final judgment immediately appealable under Illinois Supreme Court Rule 304(b)(6), which permits appeals from a ‘custody or allocation of parental responsibilities judgment or modification of such judgment’ entered pursuant to the Marriage Act. See Ill. Sup. Ct. R. 304 (‘Appeals from Final Judgments that do not Dispose of an Entire Proceeding.). Judge Johnson’s June 13, 2018 order was therefore final for Rooker-Feldman purposes even though the state court may modify the order in the future.”

Second, the panel holds that Hadzi-Tanovic alleged injuries – the loss of unsupervised visitation and alleged deprivation of due process – were caused by the state court judgment. “For a federal court to find that the state court deprived plaintiffs of their constitutional right to familial association, the federal court would have to find that the state court erred in applying state family law.” Likewise, the due process challenge directly challenged orders by the court, e.g., the scheduling of motions to the unfair advantage of the defendant.

The district court followed circuit authority that found an exception for state-court judgments allegedly procured by corrupt state-court proceedings, but the panel dispatches with that exception.

“First and foremost, the Supreme Court has not even hinted that Rooker-Feldman is subject to such a corruption exception, and that exception opens up a sizable loophole in this important jurisdictional doctrine . . . . [T]he only way a federal court could determine the merits of [such] allegations would be to review the state court’s handling of the case from top to bottom, substantively and procedurally. If the state court’s decisions appeared to be well-grounded in law and fact and reached through fair procedures, a federal court would presumably conclude they were not rooted in bias or corruption. If the federal court found factual, legal, or procedural errors, the court would have to consider whether the errors were ordinary errors of a fallible human institution or instead the product of corruption.”

“Second, we are not convinced that overruling this circuit’s corruption exception to Rooker-Feldman will actually deprive plaintiffs of a federal remedy they would otherwise have. Our review of cases in this circuit persuades us that even if Rooker-Feldman did not bar Hadzi-Tanovic’s suit, claims like hers would almost certainly founder on other grounds. Plaintiffs alleging injuries arising from corruption in state court proceedings face a dense thicket of obstacles that prevent their claims from proceeding to the merits.”

The panel concludes: “We understand the high stakes of this case—and of all divorce and custody cases. The serious but as yet unproven allegations against [the] guardian ad litem . . . remind us of the potential consequences of genuine corruption in a court system. Nevertheless, we may not exercise jurisdiction where Congress has not provided it.”

Dissenting, Judges Kirsch and St. Eve would adhere to the prior authority. They would hold that the very-limited province of Rooker-Feldman is to preclude federal courts from actually invalidating state-court judgments. “Rooker-Feldman requires not only a federal plaintiff with an injury caused by a state court judgment, but also—in every case— that the plaintiff asks the federal court to ‘undo’ or ‘overturn’ that judgment.” Under recent Supreme Court authority, “the last thing we’re supposed to do is broaden the universe of cases kept out of court by Rooker-Feldman . . . . But by discarding . . . [the] requirement that a plaintiff seek ‘review and rejection’ of a state court judgment, that is exactly what the panel does.”

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: