Jaffe v. Bank of America Corporation et al

Filing 17

ORDER granting 4 Motion to Remand to Maricopa County Superior Court; denying as moot the following motions: 5 Motion to Dismiss for Failure to State a Claim; 6 Motion to Dismiss for Failure to State a Claim; 7 Motion to Dismiss for Failure to State a Claim; 13 Motion for Clarification of Status, and 14 Motion To Amend. Signed by Judge G Murray Snow on 2/14/12. (Attachments: # 1 Remand Letter)(DMT)

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WO

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Sol Jaffe,
Plaintiff,

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vs.

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Bank of America Corporation, et. al.,
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Defendants.
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No. CV-12-139-PHX-GMS
ORDER

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Pending before the Court are: 1) Plaintiffs Motion to Remand (Doc. 4); 2) Merrick

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Bank’s Motion to Dismiss for Failure to State a Claim (Doc. 5); 3) JPMorgan Chase &

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Company’s Motion to Dismiss (Doc. 6); 4) Bank of America Corporation’s Motion To

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Dismiss for Failure to State a Claim (Doc. 7); 5) Plaintiff’s Motion for Clarification of Status

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(Doc. 13); and 6) Plaintiff’s Motion To Amend (Doc. 14). For the reasons stated below,

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Plaintiff’s Motion to Remand (Doc. 4) is granted and this case is remanded to state court.

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The remaining motions are denied as moot.

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ANALYSIS

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“Only . . . actions that originally could have been filed in federal court may be

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removed to federal court by the defendant.” Caterpillar, Inc. v. Williams, 482 U.S. 386, 392

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(1987). “If at any time before final judgment it appears that the district court lacks subject

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matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). There is a “strong

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presumption” against removal, and “[f]ederal jurisdiction must be rejected if there is any

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doubt as to the right of removal in the first instance.” Gaus v. Miles, Inc., 980 F.2d 564, 566

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(9th Cir. 1992) (citing Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir.

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1979)).

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jurisdictional facts.” Indus. Tectonics, Inc. v. Aero Alloy, 912 F.2d 1090, 1092 (9th Cir.

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1990).

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I.

Moreover, “[t]he party asserting jurisdiction has the burden of proving all

Diversity Jurisdiction

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“In a removed case, . . . the plaintiff chose a state rather than federal forum. Because

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the plaintiff instituted the case in state court, ‘there is a strong presumption that the plaintiff

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has not claimed a large amount in order to confer jurisdiction on a federal court[.]’” Singer v.

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State Farm Mut. Auto. Ins. Co., 116 F.3d 373, 375 (9th Cir. 1997) (quoting St. Paul Mercury

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Indem. Co. v. Red Cab Co., 303 U.S. 283, 290 (1938)). “Where the complaint does not

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demand a dollar amount, the removing defendant bears the burden of proving by a

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preponderance of the evidence that the amount in controversy exceeds [$75,000].” Id. at 376

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(citing Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996); see Valdez

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v. Allstate Ins. Co., 372 F.3d 1115, 1116-17 (9th Cir. 2004) (citing 28 U.S.C. § 1332(a)); see

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also Gaus, 980 F.2d at 566-67 (“If it is unclear what amount of damages the plaintiff has

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sought, . . . then the defendant bears the burden of actually proving the facts to support . . .

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the jurisdictional amount.”) (emphasis in original). “Under this burden, the defendant must

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provide evidence establishing that it is ‘more likely than not’ that the amount in controversy

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exceeds [$75,000].” Sanchez, 102 F.3d at 404; see Valdez, 372 F.3d at 1117. “[R]emoval

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‘cannot be based simply upon conclusory allegations’ where the [complaint] is silent” as to

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the dollar amount of damages the plaintiff seeks. Singer, 116 F.3d at 377.

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In his Motion to Remand, the Plaintiff asserts under oath that he seeks $6900 for all

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the claims in his complaint. Further, as is further discussed below, to the extent that the

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Plaintiff asserts state tort claims “relating to the responsibilities of persons who furnish

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information to consumer reporting agencies,”15 U.S.C. § 1681t(b)(F), such claims are pre-

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empted by federal law and have already been dismissed by this Court. Therefore, Plaintiff’s

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complaint cannot be one for tort claims that in any way relate “to the responsibilities of
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persons who furnish information to consumer reporting agencies.” To the extent that the

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possible basis for liability stated in Plaintiff’s complaint is limited, so is the realistic prospect

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for any damages sufficient to meet federal jurisdictional requirements. “If at any time before

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final judgment it appears that the district court lacks subject matter jurisdiction, the case shall

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be remanded.” 28 U.S.C. § 1447(c). In light of Plaintiff’s avowal that his complaint seeks

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no more than $6900 to resolve all of its claims, this Court lacks jurisdiction. In such

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circumstances, the amount required to invoke the diversity jurisdiction of the federal courts

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has not been met.

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II.

Federal Question Jurisdiction

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“The district courts shall have original jurisdiction of all civil actions arising under

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the Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331. “A case ‘arises

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under’ federal law . . . if ‘a well-pleaded complaint establishes that federal law creates the

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cause of action or that the plaintiff’s right to relief necessarily depends on resolution of a

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substantial question of federal law.’” Proctor v. Vishay Intertech. Inc., 584 F.3d 1208, 1219

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(9th Cir. 2009) (quoting Empire Healthchoice Assurance, Inc. v. McVeigh, 547 U.S. 677,

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689–90 (2006)). Plaintiff’s complaint asserts no federal claims. Rather, it asserts state tort

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claims for intentional infliction of emotional and physical distress, gross negligence, and

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harassment based upon the false transmission or receipt of information affecting Plaintiff’s

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credit rating. Defendants cannot, with rare exception, appropriate Plaintiff’s complaint and

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assert that it is, in reality, asserting federal claims. They do not successfully do so here

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because Plaintiff had previously asserted federal claims in a previous action in this court

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based on the same facts as asserted here, and had those claims dismissed.

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Defendants further assert, however, that removal was appropriate because the Federal

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Fair Credit Reporting Act pre-empts state law claims against credit information furnishers

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based on alleged injury arising rom the reporting of credit information. See Buraye v.

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Equifax, 625 F. Supp. 2d 894, 900-01 (C.D. Cal. 2008); 15 U.S.C. § 1681t(b)(1)(F). It is,

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however, settled law “that a case may not be removed to federal court on the basis of a

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federal defense, including the defense of pre-emption, even if the defense is anticipated in
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the plaintiff’s complaint, and even if both parties concede that the federal defense is the only

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question truly at issue.” Caterpillar, 482 U.S. at 393. There is, however, a corollary rule

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known as the complete pre-emption doctrine. “Once an area of state law has been

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completely pre-empted any claim purportedly based on that pre-empted state law is

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considered, from its inception, a federal claim, and therefore arises under federal law.” Id.

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Defendant Chase asserts that the Federal Fair Credit Reporting Act completely pre-

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empts all state law claims “relating to the responsibilities of persons who furnish information

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to consumer reporting agencies.” 15 U.S.C. § 1681t(b)(F), and thus pre-empts all of the tort

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claims asserted by Plaintiff in this case, thus making them federal claims for purposes of

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removal. While the Court agrees that any claims “relating to the responsibilities of persons

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who furnish information to consumer reporting agencies” may be completely pre-empted,

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that is not the only basis on which the Plaintiff asserts his state tort claims.

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The Court has carefully reviewed the complaint that Defendants seek to remove to

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determine whether all of the claims it asserts are for torts that would be pre-empted by the

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Federal Fair Credit Reporting Act. Federal Courts in this circuit are obliged to liberally read

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a Plaintiff’s complaint. It appears to this Court, in engaging in such a reading, that the

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complaint does not merely allege torts “relating to the responsibilities of persons who furnish

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information to consumer reporting agencies.’ Rather, in addition to alleging that Defendants

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have committed torts against him that would likely be pre-empted, Plaintiff also alleges that

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the torts result because certain of the Defendants are attempting to recover debts from him

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that he does not owe.

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For example, Plaintiff alleges that Defendants Bank of America and Chase are

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attempting to “extort monies from him, which he does not owe.” Although he alleges the

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same as to Defendant Merrick, he additionally alleges with respect to it that “they have just

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begun collection efforts in the face of litigation; and have refused to supply any

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documentation for their claims. Jaffe has experienced numerous collection phone calls and

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letters; and the collection process does not stop, because of disputes and/or litigation and/or
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notices to do so. And they have no documentation to support their claims.” With respect to

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Defendant Portfolio, Plaintiff alleges that it “seems to have bought credit card debt from

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CAPITAL ONE and HSBC; and has no verification that JAFFE owes anything on said card

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debts . . . and they are also sending collection letters based upon the disputed debt, for which

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they have no documentary evidence for (sic).” The complaint further alleges that “the

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DEFENDANTS are involved in . . . collections. . . . one either does not owe a legal debt or

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one does owe a legal [debt] . . . and one must have evidence, documentation, before one

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claims same . . . and/or threatening lawsuits regarding same.” He further alleges that

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Defendants “stated they had a claim, and they had a right to threaten to sue.” “The

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DEFENDANTS continue to send JAFFE dunning letters and threaten to sue him based upon

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nothing other than that they can.”

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In short, it appears that a fair reading of Plaintiff’s complaint demonstrates that the

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torts he alleges do not result only from activities “relating to the responsibilities of persons

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who furnish information to consumer reporting agencies,” but also from wrongful attempts

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to collect a non-existent debt. Defendants offer no argument that such claims are also pre-

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empted by the FDCA or other law.

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Further, to the extent that Plaintiff’s federal claims have already been dismissed by

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this Court, and a substantial part of the remaining tort law claims are, at any rate, pre-empted

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by those dismissed federal claims, Defendant Chase identifies no viable remaining claim of

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Plaintiff that turns on substantial questions of federal law. Therefore, because all of

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Plaintiff’s claims stated against the Defendants are not completely pre-empted, because any

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federal claims arising from the factual transactions in the complaint have already been

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dismissed, there is no federal jurisdiction over Plaintiff’s complaint, and there is no basis for

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removal.

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IT IS THEREFORE ORDERED granting Plaintiff’s Motion to Remand (Doc. 4)
and directing the Clerk of the Court to remand this case to state court.

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IT IS FURTHER ORDERED denying the Motions to Dismiss of Defendants

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Merrick Bank (Doc. 5), JPMorgan Chase & Company (Doc. 6), and Bank of America
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Corporation (Doc. 7), as well as Plaintiff’s Motion for Clarification of Status (Doc. 13) and

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Motion To Amend (Doc. 14) as moot.

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DATED this 14th day of February, 2012.

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