## Facts

- Borrowers, including Dexter and Gretchen Kamilewicz and Martha Preston, were members of an Alabama state-court class action alleging a mortgage servicer failed to timely post interest to escrow accounts.
- The Alabama case settled: class members received small escrow credits; the bank paid class counsel a large fee; and the settlement was approved after a fairness hearing and final judgment.
- Some class members allegedly suffered a net loss because their escrow accounts were debited administrative charges exceeding the credited amounts (e.g., a $2.19 credit and a $91.33 debit).
- The borrowers later sued in federal court in the Northern District of Illinois against the bank entities and the lawyers/law firms that served as class counsel.
- The federal complaint asserted malpractice and related tort theories premised on alleged nondisclosure and unfairness in the settlement’s structure and fee arrangement.
- Defendants moved to dismiss, arguing the suit was a forbidden collateral attack on the Alabama judgment under the Rooker–Feldman doctrine.
- The district court dismissed for lack of subject-matter jurisdiction; the borrowers appealed.

## Issues

1. Whether the Rooker–Feldman doctrine deprived the federal district court of subject-matter jurisdiction because the plaintiffs’ alleged injuries were caused by, and their requested relief would effectively negate, an Alabama state-court judgment approving a class settlement and attorneys’ fee award.
2. Whether repackaging the challenge as malpractice, fraud, or other tort claims against class counsel and the settling defendant avoids Rooker–Feldman when success would require discrediting the state judgment.

## Decision

- The Seventh Circuit affirmed the dismissal for lack of subject-matter jurisdiction.
- The court held the suit was barred by Rooker–Feldman because it sought, in substance, federal review and rejection of the Alabama court’s settlement-approval judgment.
- The court rejected plaintiffs’ attempt to characterize their claims as independent tort injuries, concluding the alleged harm flowed from the state judgment approving the settlement and fee structure.
- Relief in federal court would necessarily contradict or undermine the state court’s approval of the settlement and fees; such review is unavailable in federal district court.

## Legal Principles

- Federal district courts lack jurisdiction over claims that function as de facto appeals of state-court judgments; only the U.S. Supreme Court may review such judgments through the appropriate appellate route.
- Rooker–Feldman applies when plaintiffs complain of injuries caused by a state-court judgment and seek relief that would effectively nullify or call into question that judgment.
- A plaintiff cannot create federal jurisdiction through artful pleading; relabeling an attack on a state judgment as malpractice, fraud, or other tort claims does not avoid Rooker–Feldman when the requested relief requires repudiating the judgment.
- In the class settlement context, a federal damages action is barred when it would require a federal court to determine that the state court wrongly approved the settlement terms or attorneys’ fee award.

## Conclusion

The Seventh Circuit concluded that the borrowers’ federal malpractice-and-tort suit was an impermissible collateral challenge to an Alabama state-court judgment approving a class settlement and fee award, so the federal courts lacked subject-matter jurisdiction under the Rooker–Feldman doctrine.


Kamilewicz v. Bank of Bos. Corp., 100 F.3d 1348 (7th Cir. 1996)