Constantino Vergara v. Wells Fargo Bank, N.A. et al

Filing 18

MINUTES (IN CHAMBERS): ORDER by Judge Josephine L. Staton: granting 13 Motion to Remand Case to State Court. Case Remanded to Superior Court of California, Orange County 30-2014-00761205. MD JS-6. Case Terminated. (twdb)

JS-6

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 15-00058-JLS (RNBx)
Title: Constantino Vergara v. Wells Fargo Bank, N.A. et al

Date: March 17, 2015

Present: HONORABLE JOSEPHINE L. STATON, UNITED STATES DISTRICT JUDGE

Terry Guerrero
Deputy Clerk
ATTORNEYS PRESENT FOR PLAINTIFF:

Not Present

N/A
Court Reporter
ATTORNEYS PRESENT FOR DEFENDANT:

Not Present

PROCEEDINGS: (IN CHAMBERS) ORDER GRANTING PLAINTIFF’S
MOTION TO REMAND (Doc. 13) AND REMANDING CASE
TO ORANGE COUNTY SUPERIOR COURT, CASE NO. 302014-00761205-CU-OR-CJC
Before the Court is a Motion to Remand filed by Plaintiff Constantino Vergera.
(Mot., Doc. 13.) Defendants Wells Fargo Bank, N.A. and Golden West Savings
Association Service Co. opposed, and Plaintiff replied. (Opp., Doc. 15; Reply, Doc. 16.)
The Court finds this matter appropriate for decision without oral argument. Fed. R. Civ.
P. 78; C.D. Cal. R. 7-15. Accordingly, the hearing set for March 20, 2015, at 2:30 p.m. is
VACATED. For the following reasons, the Court GRANTS the Motion.
I.

BACKGROUND

On December 11, 2014, Plaintiff Constantino Vergara filed this action in Orange
County Superior Court against Defendants Wells Fargo Bank, N.A. and Golden West
Savings Association Service Company. (Compl., Doc. 1-1, Ex. A.) Vergara contends
that after he began having difficulty making payments on his home mortgage loan, he
pursued a loan modification with Wells Fargo, which placed him on a Trial Period Plan
instead. (Id. ¶ 11-14.) Vergara alleges that because the Trial Period Plan failed to
alleviate his financial burden, he again sought a loan modification. (Id. ¶¶ 15-16.)
However, Vergara contends that due to Wells Fargo’s “lack of communication and
constant undue delay” regarding his loan application, his application lapsed numerous
times, resulting in the foreclosure of his property. (Id. ¶¶ 17, 24-26.)
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____________________________________________________________________________
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 15-00058-JLS (RNBx)
Title: Constantino Vergara v. Wells Fargo Bank, N.A. et al

Date: March 17, 2015

In his Complaint, Vergara asserts claims for (1) various violations of California’s
Homeowner Bill of Rights; (2) breach of implied covenant of good faith and fair dealing;
(3) negligent misrepresentation; (4) violations of Business and Professions Code § 17200;
and (5) injunctive relief under California Civil Code § 2924.19. (Id. ¶¶ 30-62.)
On January 14, 2015, Defendants removed the case to this Court on the basis of
diversity jurisdiction. (Notice of Removal, Doc. 1.)
On January 23, 2015, Vergara filed this Motion, arguing that Defendants have
failed to meet their burden of showing that the amount in controversy and complete
diversity requirements are met. (Mot.; Mem., Doc. 13-1.) Vergara also requests
attorneys’ fees and costs incurred in connection with Defendants’ removal. (Mem. at 11.)
II.

LEGAL STANDARD

When reviewing a notice of removal, “it is to be presumed that a cause lies outside
the limited jurisdiction of the federal courts and the burden of establishing the contrary
rests upon the party asserting jurisdiction.” Hunter v. Philip Morris USA, 582 F.3d 1039,
1042 (9th Cir. 2009) (quoting Abrego Abrego v. Dow Chem. Co., 443 F.3d 676, 684 (9th
Cir. 2006) (quotation marks omitted)). Courts “strictly construe the removal statute
against removal jurisdiction,” and “the defendant always has the burden of establishing
that removal is proper.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992).
To exercise diversity jurisdiction, a federal court must find complete diversity of
citizenship among the adverse parties, and the amount in controversy must exceed
$75,000. 28 U.S.C. § 1332(a). “[W]here it is unclear or ambiguous from the face of a
state-court complaint whether the requisite amount in controversy is pled,” the removing
defendant bears the burden of proving by a preponderance of the evidence that the
amount in controversy exceeds the jurisdictional amount. Guglielmino v. McKee Foods
Corp., 506 F.3d 696, 699 (9th Cir. 2007). “Under this burden, the defendant must
provide evidence establishing that it is ‘more likely than not’ that the amount in
controversy exceeds that amount.” Sanchez v. Monumental Life Ins. Co., 102 F.3d 398,
404 (9th Cir. 1996). On a motion to remand, the Court “consider[s] facts presented in the
removal petition as well as any summary-judgment-type evidence relevant to the amount
in controversy at the time of removal.” Valdez v. All State Ins. Co., 372 F.3d 1115, 1117
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____________________________________________________________________________
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 15-00058-JLS (RNBx)
Title: Constantino Vergara v. Wells Fargo Bank, N.A. et al

Date: March 17, 2015

(9th Cir. 2004) (internal citations and quotation marks omitted). The Court weighs
Defendant’s evidence against any countervailing evidence showing that the amount in
controversy falls below $75,000. See Metro. Stevedore Co. v. Rambo, 521 U.S. 121, 137
n.9 (1997) (When applying the preponderance standard, a court considers “how
convincing the evidence in favor of a fact [is] in comparison with the evidence against it
before that fact may be found.”).
III.

DISCUSSION
A.

Diversity Jurisdiction

Vergara argues remand is proper because Defendants have failed to demonstrate
that (1) complete diversity exists and (2) the amount in controversy in this matter exceeds
$75,000. (Mem. at 3-11.)
The Court first addresses Vergara’s contention that the amount in controversy
requirement is not satisfied. (Mem. at 8-11.) Vergara’s Complaint does not allege an
amount in controversy. (See Compl.) In their Notice of Removal, Defendants contend
that “[s]hould plaintiff prevail in this action, he would retain title to [his] Property
without any encumbrances . . . which would result in a loss of, at a minimum, the original
principal loan amount of $491,250.00.” (Notice of Removal at 7.) This is without merit.
Nowhere does Vergara’s Complaint seek invalidation of the subject loan. (Compl. at 1314.) Rather, Vergara seeks “a true and significant loan modification,” damages for
Defendants’ alleged violations of state law, an injunction enjoining Defendants from
conducting any further foreclosure action, attorneys’ fees, and costs. (Id.) Thus,
Defendants cannot establish that the amount-in-controversy requirement is met on these
grounds.
Defendants alternately argue that Vergara’s demand for an “injunction enjoining
[Wells Fargo] from conducting further foreclosure activity” on the property places the
value of the entire loan at issue. (Opp. at 6.) This argument is unavailing. Courts have
roundly rejected the argument that the amount in controversy is the entire amount of the
loan where a plaintiff seeks injunctive relief to enjoin a foreclosure sale pending a loan
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____________________________________________________________________________
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 15-00058-JLS (RNBx)
Title: Constantino Vergara v. Wells Fargo Bank, N.A. et al

Date: March 17, 2015

modification.1 See Cheng v. Wells Fargo Bank, N.A., No. SACV10-1764-JLS (FFMx),
2010 WL 4923045, at *2 (C.D. Cal. Dec. 2, 2010) (Staton, J.) (“[T]he primary relief
sought by plaintiff is a temporary delay of the foreclosure proceedings, and the amount of
the loan at issue would therefore not be a relevant measure of damages.”); see also
Vonderscher v. Green Tree Servicing, LLC, No. 2:13-CV-00490-MCE, 2013 WL
1858431, at *4 (E.D. Cal. May 2, 2013) (“Numerous other courts have found that when a
plaintiff does not seek to rescind the loan at issue, but instead seeks damages in an
unspecified amount . . . the amount in controversy is not properly gauged by the loan
amount.”); Landa v. Flagstar Bank, FSB, No. 10CV1429-L (BGS), 2010 WL 2772629, at
*2 (S.D. Cal. July 13, 2010) (remanding action where plaintiffs sought an “injunction
against foreclosure” but were “not seeking loan rescission.”). The only binding authority
cited by Defendants is not to the contrary. See Chapman v. Deutsche Bank Nat. Trust
Co., 651 F.3d 1039 (9th Cir. 2011) (plaintiffs sought to quiet title); Garfinkle v. Wells
Fargo Bank, 483 F.2d 1074, 1076 (9th Cir. 1973) (plaintiff sought to permanently enjoin
bank from foreclosure sale on the grounds that California’s nonjudicial foreclosure
statute was unconstitutional).
“[T]he defendant always has the burden of establishing that removal is proper.”
Gaus, 980 F.2d at 566. Because Defendants have not shown by a preponderance of the
evidence that more than $75,000 is at issue in this case, they have not met their burden
here. See Guglielmino, 506 F.3d at 699. Accordingly, the Court GRANTS Vergara’s
Motion to Remand.
B.

Request for Attorneys’ Fees and Costs

Vergara next requests attorneys’ fees and costs incurred in conjunction with
Defendants’ removal. (Mem. at 10-11.)
The removal statute permits the Court, upon remand, to “require payment of just
costs and any actual expenses, including attorney fees, incurred as a result of the
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While Vergara’s prayer for relief is arguably ambiguous on this point, there is no doubt
that this is the relief he seeks, as the Homeowner Bill of Rights does not authorize permanent
injunctive relief, but permits it only until the defendant “show[s] that the material violation has
been corrected and remedied.” Cal. Civ. Code §§ 2924.12, 2924.19.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SACV 15-00058-JLS (RNBx)
Title: Constantino Vergara v. Wells Fargo Bank, N.A. et al

Date: March 17, 2015

removal.” 28 U.S.C. § 1447(c). However, “[a]bsent unusual circumstances, courts may
award attorney’s fees under § 1447(c) only where the removing party lacked an
objectively reasonable basis for seeking removal.” Martin v. Franklin Capital Corp., 546
U.S. 132, 141 (2005). While Defendants have not shown more than $75,000 is in
controversy, the Court acknowledges Defendants’ reliance on certain non-binding
authority in their favor. See, e.g., Cabriales v. Aurora Loan Servs., 2010 WL 761081
(N.D. Cal. Mar. 2, 2010). While the Court is unpersuaded by those cases, it declines to
find Defendants’ reliance on them objectively unreasonable.
Accordingly, Vergara’s request for attorneys’ fees and costs is DENIED.
IV.

CONCLUSION

For the foregoing reasons, the Court GRANTS Plaintiff’s Motion to Remand and
REMANDS this case to Orange County Superior Court, Case No. 30-2014-00761205CU-OR-CJC.

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