Mike Spanos v. US Bancorp et al

Filing 9

MINUTE (IN CHAMBER) ORDER REMANDING THIS CASE TO THE SUPERIOR COURT OF CALIFORNIA, COUNTY OF SAN BERNARDINO by Judge Beverly Reid O'Connell: Plaintiff has failed to establish federal court subject matter jurisdiction under either section 1332 or section 1331. Accordingly, the Court REMANDS this matter to the Superior Court of California, County of San Bernardino. (Made JS-6. Case Terminated.) (jp)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

JS-6

CIVIL MINUTES – GENERAL
Case No.

CV 15–00162 BRO (DTBx)

Title

MIKE SPANOS V. U.S. BANCORP ET AL.

Date

February 6, 2015

Present: The
Honorable

BEVERLY REID O’CONNELL, United States District
Judge

Renee A. Fisher

Not Present

N/A

Deputy Clerk

Court Reporter

Tape No.

Attorneys Present for Plaintiffs:

Attorneys Present for Defendants:

Not Present

Not Present

Proceedings:

(IN CHAMBERS)

ORDER REMANDING THIS CASE TO THE SUPERIOR COURT OF
CALIFORNIA, COUNTY OF SAN BERNARDINO
I.

INTRODUCTION

Plaintiff Mike Spanos (“Plaintiff”) initiated this action on January 26, 2015. (Dkt.
No. 1.) Plaintiff filed a Complaint following a foreclosure on his home, located at 13354
Viejo Circle, Victorville, California. (Compl. ¶¶ 1, 7.) Plaintiff currently faces eviction
under a California state unlawful detainer action. (Id. ¶ 7.) According to the Complaint,
Plaintiff has applied and qualifies for loan restructuring and modification, but all of his
requests have been denied. (Id. ¶ 12.)
The Complaint names four defendants: (1) U.S. Bancorp; (2) Servis One, Inc.; (3)
Cal-Western Reconveyance, LLC; and (4) Eagle Vista Equities, LLC (collectively,
“Defendants”). Plaintiff purports to bring the following eleven claims against
Defendants: (1) slander of title; (2) demand for an accounting; (3) injunctive relief; (4)
quiet title; (5) intentional infliction of emotional distress; (6) cancellation of trustee deed
upon sale under California Civil Code section 3412; (7) violation of California Civil
Code section 2923.5; (8) violation of California Civil Code section 2934a; (9) negligent
and oppressive wrongful foreclosure; (10) violation of the California Homeowner Bill of
Rights; and (11) violation of the Home Affordable Modification Program (“HAMP”).

CV-90 (06/04)

CIVIL MINUTES – GENERAL

Page 1 of 5

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

JS-6

CIVIL MINUTES – GENERAL
Case No.

CV 15–00162 BRO (DTBx)

Title

MIKE SPANOS V. U.S. BANCORP ET AL.

Date

February 6, 2015

On January 29, 2015, the Court issued an order to show cause as to why this case
should not be remanded to the Superior Court of California, County of San Bernardino.
(Dkt. No. 7.) Plaintiff timely responded. (Dkt. No. 8.)
II.

LEGAL STANDARD

Federal courts are courts of limited jurisdiction. They possess original jurisdiction
only as authorized by the Constitution and federal statute. See, e.g., Kokkonen v.
Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Original jurisdiction may be
established pursuant to 28 U.S.C. § 1332. Under § 1332, a federal district court has
“original jurisdiction of all civil actions where the matter in controversy exceeds the sum
or value of $75,000, exclusive of interest and costs,” and the dispute is between “citizens
of different states.” Id. § 1332(a)(1). The United States Supreme Court has interpreted
the diversity statute to require “complete diversity of citizenship,” meaning each plaintiff
must be diverse from each defendant. Caterpillar Inc. v. Lewis, 519 U.S. 61, 67–68
(1996).
Under 28 U.S.C. § 1331, federal courts have jurisdiction over “all civil actions
arising under the Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331.
A case “arises under” federal law if a plaintiff’s “well-pleaded complaint establishes
either that federal law creates the cause of action” or that the plaintiff’s “right to relief
under state law requires resolution of a substantial question of federal law in dispute
between the parties.” Franchise Tax Bd. v. Constr. Laborers Vacation Trust for S. Cal.,
463 U.S. 1, 13 (1983).
III.

DISCUSSION

After reviewing the Complaint and Plaintiff’s response to the Court’s January 29,
2015 order to show cause, the Court concludes that it lacks subject matter jurisdiction
over this controversy. Accordingly, the court REMANDS this action to the Superior
Court of California, County of San Bernardino. See Cal. Civ. Proc. Code § 395(b).
A. The Court Lacks Diversity Jurisdiction

CV-90 (06/04)

CIVIL MINUTES – GENERAL

Page 2 of 5

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

JS-6

CIVIL MINUTES – GENERAL
Case No.

CV 15–00162 BRO (DTBx)

Title

MIKE SPANOS V. U.S. BANCORP ET AL.

Date

February 6, 2015

The Complaint fails to invoke this Court’s federal subject matter jurisdiction under
28 U.S.C. § 1332. As an initial matter, the Complaint does not allege an amount in
controversy. (See generally Compl.) Plaintiff does seek general, exemplary, and special
damages, as well as punitive damages and attorneys’ fees. (See id. Prayer for Relief.)
But Plaintiff does not demand any specific amount of damages. In response to the
Court’s order to show cause, Plaintiff asserts that the value of his home is at least
$193,200. (See Dkt. No. 8 at ¶ 1.) Plaintiff also asserts that the alleged general,
exemplary, and special damages will exceed $100,000 each, and that the alleged punitive
damages will exceed $500,000. (Id. at ¶ 2.) Even assuming these unsupported
allegations meet the amount in controversy requirement’s preponderance of the evidence
standard, the Court still lacks diversity jurisdiction because, as discussed below, Plaintiff
has not demonstrated complete diversity.
Plaintiff alleges that Defendants U.S. Bancorp and Servis One, Inc. are Delaware
corporations with a principal place of business in Minnesota and Texas, respectively.
(Compl. ¶¶ 3, 4.) These allegations are sufficient to demonstrate diversity with respect to
these defendants. But Plaintiff’s allegations regarding the citizenship of the remaining
two defendants, Cal-Western Reconveyance, LLC (“Cal-Western”) and Eagle Vista
Equities, LLC (“Eagle Vista”) do not demonstrate diversity.
As the Court explained in its order to show cause, for purposes of diversity
jurisdiction, a limited liability corporation is considered a citizen of every state in which
its owners or members are citizens. Johnson v. Columbia Props. Anchorage, LP, 437
F.3d 894, 899 (9th Cir. 2006). Thus, to adequately allege a limited liability corporation’s
citizenship and invoke a federal court’s diversity jurisdiction, a plaintiff must: (1) identify
all of the limited liability corporation’s owners or members; and (2) plead the complete
citizenship of each owner or member. For example, if an owner or member is an
individual, a plaintiff must plead the individual’s state of domicile. See Kanter v.
Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001) (explaining that a natural
person’s state citizenship is determined by the individual’s state of domicile). If an
owner or member is a corporation, a plaintiff must plead the corporation’s state of
incorporation and principal place of business. See 28 U.S.C. § 1332(c).
Here, Plaintiff alleges that Cal-Western and Eagle Vista are California limited
liability companies. (Compl. ¶¶ 5, 6.) Plaintiff must therefore demonstrate each
CV-90 (06/04)

CIVIL MINUTES – GENERAL

Page 3 of 5

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

JS-6

CIVIL MINUTES – GENERAL
Case No.

CV 15–00162 BRO (DTBx)

Title

MIKE SPANOS V. U.S. BANCORP ET AL.

Date

February 6, 2015

defendant’s citizenship as outlined above. Plaintiff has failed to do so. The Complaint
only alleges Cal-Western and Eagle Vista’s principal places of business, as well as the
location of their registered agents for service of process. (Id.) And Plaintiff’s response to
the order to show cause only asserts that “all defendants are operating and doing business
in almost all states of the United States of America.” (Dkt. No. 8 at ¶ 3.) These
allegations and assertions are insufficient to demonstrate either Cal-Western or Eagle
Vista’s citizenship. Plaintiff has not identified the members or owners of either
defendant, nor alleged the complete citizenship of each owner or member. Accordingly,
Plaintiff has failed to meet his burden of establishing complete diversity, and the Court
lacks jurisdiction under § 1332.
B. The Court Lacks Federal Question Jurisdiction
The Court also lacks subject matter jurisdiction under 28 U.S.C. § 1331. The
Complaint’s first ten causes of action are all state law claims. (See Compl. ¶¶ 13–53.)
The eleventh claim alleges a violation of HAMP. (Id. ¶¶ 54–55.) Plaintiff’s response to
the Court’s order to show cause asserts that federal question jurisdiction exists based on
the HAMP claim. (Dkt. No. 8 at ¶ 4.)
Plaintiff’s invocation of federal question jurisdiction under HAMP is unavailing
for two reasons. First, it is well-established that HAMP does not provide plaintiffs with a
private right of action. See Dias v. Fed. Nat’l Mortg. Ass’n, 990 F. Supp. 2d 1042, 1054
(D. Haw. 2013); Sutcliffe v. Wells Fargo Bank, N.A., 283 F.R.D. 533, 553 (N.D. Cal.
2012). As a result, Plaintiff’s eleventh claim cannot provide the basis for federal question
jurisdiction under the well-pleaded complaint rule. Franchise Tax Bd., 463 U.S. at 13.
Second, to the extent Plaintiff’s state law claims allege violations of HAMP, the
allegations are insufficient to invoke federal question jurisdiction. “A state cause of
action invokes federal question jurisdiction only if it ‘necessarily raise[s] a stated federal
issue, actually disputed and substantial, which a federal forum may entertain without
disturbing any congressionally approved balance of federal and state judicial
responsibilities.’” Nevada v. Bank of Am. Corp., 672 F.3d 661, 674 (9th Cir. 2012)
(quoting Grable & Sons Metal Prods. v. Darue Eng’g & Mfg., 545 U.S. 308, 314 (2005)).
“It is not enough that the court may have to interpret federal laws or regulations. ‘Arising
under’ jurisdiction exists only where the vindication of a right under state law necessarily
CV-90 (06/04)

CIVIL MINUTES – GENERAL

Page 4 of 5

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

JS-6

CIVIL MINUTES – GENERAL
Case No.

CV 15–00162 BRO (DTBx)

Title

MIKE SPANOS V. U.S. BANCORP ET AL.

Date

February 6, 2015

turn(s) on some construction of federal law.” Carlos v. Bank of Am. Home Loans, No.
CV 10-1966 AHM, 2011 WL 166343, at *1 (C.D. Cal. Jan. 13, 2011) (internal quotation
marks omitted) (concluding that the court lacked federal question jurisdiction and
remanding the case where the plaintiffs’ state law claims incorporated or turned on
alleged HAMP violations). Here, to the extent Plaintiff’s state law claims raise federal
issues under HAMP, these issues do not reach the requisite level of substantiality to
justify federal court jurisdiction. See Grable, 545 U.S. at 314 (“Because arising-under
jurisdiction to hear a state-law claim always raises the possibility of upsetting the statefederal line . . . , the presence of a disputed federal issue and the ostensible importance of
a federal forum are never necessarily dispositive; there must always be an assessment of
any disruptive portent in exercising federal jurisdiction.”).
IV.

CONCLUSION

For the foregoing reasons, Plaintiff has failed to establish federal court subject
matter jurisdiction under either § 1332 or § 1331. Accordingly, the Court REMANDS
this matter to the Superior Court of California, County of San Bernardino.
:

IT IS SO ORDERED.
Initials of
Preparer

rf

CV-90 (06/04)

CIVIL MINUTES – GENERAL

Page 5 of 5