Cornell v. U.S. Bank National Association, alleged trustee et al

Filing 73

MEMORANDUM AND ORDER signed by Senior Judge William B. Shubb on 10/18/2013 DENYING 52 Plaintiff's Motion to Remand; DENYING 56 Plaintiff's Motion to Dismiss ; and DENYING 62 Plaintiff's Motion to Strike. (Kirksey Smith, K)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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----oo0oo----

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MELANIE I. CORNELL
Plaintiff,

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NO. CIV. 2:12-330 WBS CKD
MEMORANDUM AND ORDER RE:
MOTION TO REMAND; MOTION TO
STRIKE RESPONSIVE BRIEF

v.
That Certain Instrument Entitled
“Deed of Trust,” under Recorder’s
Document Number 20110015747
originally dated August 8, 2005
and filed in Nevada County; That
Certain “Corporate Assignment of
Deed of Trust,” under Recorder’s
Document Number 20110015748 dated
June 14, 2011 and filed in Nevada
County; That Certain Instrument
Entitled “Deed of Trust,” under
Recorder’s Document Number DOC2005-0111849 originally dated
August 8, 2005 and filed in
Placer County; NEW CENTURY
MORTGAGE CORPORATION; U.S BANK
NATIONAL ASSOCIATION, alleged
trustee; CHICAGO TITLE COMPANY
(erroneously named as CHICAGO
TITLE INSURANCE COMPANY),
Defendants.

----oo0oo----

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Plaintiff Melanie I. Cornell brought this action

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against defendants New Century Mortgage Corporation (“New

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Century”), U.S. Bank National Association (“U.S. Bank”), and

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Chicago Title Company (“Chicago Title”), a California

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corporation, arising from defendants’ allegedly fraudulent

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filings regarding plaintiff’s home.

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plaintiff originally filed this action in Nevada County Superior

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Court, defendants removed the case to this court on the basis of

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diversity jurisdiction and listed Chicago Title Insurance Company

(Docket No. 2-1.)

After

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(“Chicago Title Insurance”), a Florida corporation, as a

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defendant in lieu of Chicago Title.

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now moves1 to remand the case to Nevada County Superior Court

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pursuant to 28 U.S.C. § 1447, or, in the alternative, to dismiss

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the action without prejudice pursuant to Federal Rules of Civil

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Procedure 41(a)(2) and 41(b), on the basis that plaintiff is not

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diverse from Chicago Title.

(Docket No. 2.)

Plaintiff

(Docket No. 56.)2

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Although federal courts are courts of limited

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jurisdiction, Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S.

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375, 377 (1994), they have a “virtually unflagging obligation” to

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exercise jurisdiction when it is proper.

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v. United States, 424 U.S. 800, 817 (1976).

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original jurisdiction over civil actions between citizens of

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Colo. River Water Dist.
Federal courts have

Plaintiff has also filed a motion to strike defendants’
Opposition to the Motion to Remand for failing to strictly reply
to the arguments put forth in support of the motion for remand.
(Docket No. 64.) Because plaintiff’s arguments in support of
this motion are duplicative of her arguments in support of her
original motion to remand, the court will deny this motion.
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Because the parties have requested not to hold oral
argument, the court orders this matter submitted on the briefs.
The hearing set for October 21, 2013 is vacated.
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different states in which the amount in controversy exceeds

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$75,000, exclusive of interest and costs.

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“Section 1332 requires complete diversity of citizenship; each of

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the plaintiffs must be a citizen of a different state than each

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of the defendants.”

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1061, 1067 (9th Cir. 2001) (citing Caterpillar Inc. v. Lewis, 519

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U.S. 61, 68 (1996)).

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28 U.S.C. § 1332.

Morris v. Princess Cruises, Inc., 236 F.3d

In assessing diversity, however, “[a] federal court

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must disregard nominal or formal parties and rest jurisdiction

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only upon the citizenship of real parties to the controversy.”

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Kuntz v. Lamar Corp., 385 F.3d 1177, 1183 (9th Cir. 2004)

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(quoting Navarro Sav. Ass’n v. Lee, 446 U.S. 458, 461 (1980)

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(internal quotation marks omitted)).

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has no interest in the action and is joined merely to perform a

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ministerial act.

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Realty, Inc., 204 F.3d 867, 873 (9th Cir. 2000).

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paradigmatic nominal defendant is a trustee, agent, or depository

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who is joined merely as a means of facilitating collection.”

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Sec. & Exch. Comm’n v. Colello, 139 F.3d 674, 676 (9th Cir. 1998)

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(citation and internal quotation marks omitted).

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A nominal party is one who

Prudential Real Estate Affiliates, Inc. v. PPR
“The

Chicago Title’s citizenship does not affect the court’s

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diversity jurisdiction because it is a nominal party to this

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action.

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the disputed exhibits ‘A’ and ‘C’,” corresponding to the disputed

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deed of trust instruments.

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no substantive allegations against Chicago Title and asserts no

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claims for money damages against Chicago Title in its capacity as

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trustee of the disputed instruments.

Plaintiff named Chicago Title “as the trustee named in

(Compl. ¶ 7.)

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The complaint includes

See Perez v. Wells Fargo,

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929 F. Supp. 2d 988, 1002 (N.D. Cal. 2013) (holding that

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“trustees are more than nominal defendants” if these conditions

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are satisfied).

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its capacity as trustee and not because of any wrongdoing.”

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Hafiz v. Greenpoint Mortg. Funding, Inc., 652 F. Supp. 2d 1050,

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1052 (N.D. Cal. 2009).3

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Rather, plaintiff sued Chicago Title “solely in

Plaintiff cites a recent California Court of Appeal

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case, Glaski v. Bank of America N.A., 218 Cal. App. 4th 1079 (5th

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Dist. 2013), in support of the proposition that Chicago Title is

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not a nominal party.

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Plaintiff argues that the assignment of the deed of trust was

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void, and that, as a result, Chicago Title had an independent

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duty to prevent U.S. Bank from initiating a nonjudicial

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foreclosure proceeding that it had no authority to initiate.

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(Id.)

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(Pl.’s Reply 4-5 (Docket No. 67).)

Although Glaski appears to reflect a minority view, see

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Newman v. Bank of N.Y. Mellon, No. 1:12-CV-1629 AWI GSA, 2013 WL

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5603316, at *3 n.2 (E.D. Cal. Oct. 11, 2013), the court need not

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reach the merits of plaintiff’s argument because she has not

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brought any claim against Chicago Title arising out of its own

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Although Hafiz involved a defendant who submitted a
Declaration of Non-Monetary Status pursuant to California Civil
Code § 2924l, the court cannot consider Chicago Title’s
Declaration of Non-Monetary Status in this case because it was
filed in state court on February 15, 2012, eight days after the
case was removed. See Williams v. Costco Wholesale Corp., 471
F.3d 975, 976 (9th Cir. 2006) (noting that “post-removal
pleadings have no bearing on whether the removal was proper”).
Nonetheless, Hafiz still stands for the broader proposition that
a defendant who is sued solely in his capacity as trustee, like
Chicago Title, is a nominal party whose inclusion does not
destroy diversity. See 652 F. Supp. 2d at 1052.
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acts or omissions.

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exclusively “in its capacity as Trustee in the . . . deed of

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trust instruments.” (Compl. ¶ 7.)

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nominal party whose inclusion in the action does not destroy

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diversity.

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deny plaintiff’s motion to remand or to dismiss the action.4

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Rather, plaintiff sued Chicago Title

Chicago Title is therefore a

Kuntz, 385 F.3d at 1183.

Accordingly, the court must

IT IS THEREFORE ORDERED that:

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(1)

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the same hereby is, DENIED; and

plaintiff’s motion to strike defendants’ Opposition be, and

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(2)

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and the same hereby is, DENIED.

plaintiff’s motion to remand or to dismiss the action be,

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Plaintiff raises two unrelated arguments against
jurisdiction for the first time in her Reply. (See Docket No.
67.) First, plaintiff argues that defendants do not satisfy the
amount in controversy requirement set forth by 28 U.S.C. § 1332
because the instruments she seeks to cancel do not have any
monetary value themselves. (Reply at 2-3.) This argument borders
on frivolity. “In actions seeking declaratory or injunctive
relief, it is well established that the amount in controversy is
measured by the value of the object of the litigation.” Hunt v.
Wash. State Apple Adver. Comm’n, 432 U.S. 333, 347 (1977). Here,
the enforceability of the deed of trust instruments “goes to the
merits and is itself ‘the object of the litigation.’” Sekhon v.
BAC Home Loan Servicing LP, 519 Fed. App’x 971, 972 (9th Cir.
2013). Accordingly, the amount in controversy is satisfied
because the underlying property is worth $335,000. (See Notice
of Removal ¶ 12.)
Second, plaintiff argues that defendants’ removal of
the action was invalid because Chicago Title never consented to
the Notice of Removal, (Reply at 7-8), and because the removal
violated the “voluntary-involuntary rule” set forth by Self v.
Gen. Motors Corp., 588 F.2d 655 (9th Cir. 1978). (Reply at 6.)
28 U.S.C. § 1447(c) precludes these objections because they were
raised more than 30 days after the Notice of Removal and do not
dispute the court’s underlying subject matter jurisdiction. See
Lively v. Wild Oats Markets, Inc., 456 F.3d 933, 942 (9th Cir.
2006) (holding that a procedural defect in removal “constitutes a
waivable non-jurisdictional defect subject to the 30-day time
limit imposed by § 1447(c).”)
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Dated:

October 18, 2013

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