Wells Fargo Bank, N.A. v. Kirkpatrick et al

Filing 3

FINDINGS and RECOMMENDATIONS signed by Magistrate Judge Gregory G. Hollows on 2/27/2013 RECOMMENDING that the action be remanded to San Joaquin County Superior Court, Lodi Branch. The Clerk be directed to serve a certified copy of this order on the Clerk of the San Joaquin County Superior Court, Lodi Branch, and reference the state case number (39-2012-00289560-CL-UD-LOD) in the proof of service. The Clerk be directed to close this case. Referred to Judge Garland E. Burrell, Jr.. Objections to F&R due within 14 days. (Zignago, K.)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE EASTERN DISTRICT OF CALIFORNIA

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WELLS FARGO BANK, N.A.,

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Plaintiff,

No. 2:13-cv-0348 GEB GGH PS

vs.
ALICE KIRKPATRICK, et al.,
FINDINGS AND RECOMMENDATIONS

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Defendants.
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This action was referred to the undersigned pursuant to E.D. Cal. L.R. 302(c)(21).

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It was removed from state court on February 21, 2013 by defendants, based on diversity and

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federal question jurisdiction. Nevertheless, a district court has “a duty to establish subject matter

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jurisdiction over [a] removed action sua sponte, whether the parties raised the issue or not.”

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United Investors Life Ins. Co. v. Waddell & Reed Inc., 360 F.3d 960, 966 (9th Cir. 2004); see

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also Kelton Arms Condominium Assoc., Inc. v. Homestead Ins. Co., 346 F.3d 1190, 1192 (9th

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Cir. 2003). Because subject matter jurisdiction may not be waived by the parties, a district court

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must remand a case if it lacks jurisdiction over the matter. Kelton Arms Condominium Owners

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Ass’n, Inc., 346 F.3d at 1192 (citing Sparta Surgical Corp. v. Nat’l Ass’n of Sec. Dealers, Inc.,

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159 F.3d 1209, 1211 (9th Cir. 1998)); see also 28 U.S.C. § 1447(c) (“If at any time before final

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

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remanded”). Having reviewed the notice of removal, the court finds that the action should be

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remanded to state court due to lack of subject matter jurisdiction.
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Removal jurisdiction statutes are strictly construed against removal. See Libhart

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v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1979). “Federal jurisdiction must be

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rejected if there is any doubt as to the right of removal in the first instance.” Gaus v. Miles, 980

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F.2d 564, 566 (9th Cir. 1992). “The burden of establishing federal jurisdiction falls on the party

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invoking removal.” Harris v. Provident Life and Accident Ins. Co., 26 F.3d 930 (9th Cir. 1994),

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overruled on other grounds by Leeson v. Transamerica Disability Income Plan, 671 F.3d 969,

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979 (9th Cir. 2012).

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A plaintiff may bring suit in federal court if his claim “arises under” federal law.

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28 U.S.C. § 1331. In that situation, the court has original jurisdiction. A state court defendant

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cannot invoke the federal court’s original jurisdiction. But he may in some instances invoke the

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court’s removal jurisdiction. The requirements to invoke removal jurisdiction are often identical

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to those for invoking its original jurisdiction. The requirements for both relate to the same end,

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that is, federal jurisdiction.

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Removal of a state court action is proper only if it originally could have been filed

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in federal court. 28 U.S.C. § 1441. “[F]ederal courts have jurisdiction to hear, originally or by

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removal, only those cases in which a well-pleaded complaint establishes either that federal law

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

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of a substantial question of federal law.” Franchise Tax Board v. Construction Laborers

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Vacation Trust, 463 U.S. 1, 27-28, 103 S. Ct. 2841, 2855-56 (1983). Mere reference to federal

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law is insufficient to permit removal. See Smith v. Industrial Valley Title Ins. Co., 957 F.2d 90,

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93 (3d Cir. 1992). Also, defenses and counterclaims cannot provide a sufficient basis to remove

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an action to federal court. See Berg v. Leason, 32 F.3d 422, 426 (9th Cir. 1994); FIA Card Servs.

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v. McComas, 2010 WL 4974113 (S.D. Cal. Dec. 2, 2010) (remanding action removed by

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defendant on the basis that defendant’s counterclaim raised a federal question).

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Here, the exhibits attached to the removal petition establish that the state court

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action is nothing more than a simple unlawful detainer action, and is titled as such. (See Dkt.
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No. 1, at pp. 10-11.) This court has no jurisdiction over unlawful detainer actions which are

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strictly within the province of the state court. Defendants’ removal petition asserts federal

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jurisdiction “resulting from [Defendants’] Discovery Request and Demands for ‘THE

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ORIGINAL BLUE INK PROMISSORY NOTE,’ and as to identify the statutory basis for the

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discovery request/demands and other claims.” (Dkt. no. 1 at 1.) Such averments do not

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establish federal question jurisdiction.

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The removal petition also asserts complete diversity because defendants reside in

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California. The citizenship of Wells Fargo Bank, N.A., however, is not addressed in the notice

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of removal. For diversity jurisdiction pursuant to 28 U.S.C. § 1332, each plaintiff must be

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diverse from each defendant, and the amount in controversy must exceed $75,000. Defendants

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do not assert that the amount in controversy exceeds $75,000 in this case. Even if they made

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such a claim, they are informed that the measure of damages is limited to the amount sought in

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the complaint, not the value of the property. Signet Doman, LLC v. Sam Aintablian, 2012 WL

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5512388 (C.D. Cal. Nov. 14, 2012). Here, the complaint seeks possession of the subject property

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as well as restitution in an unnamed amount. (See Dkt. No. 1, at p. 11.) These requested

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damages do not satisfy the amount in controversy requirement.

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Defendants have not provided a sufficient basis to remove the action to federal

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court. Based on the aforementioned analysis, the court finds that remand is appropriate, because

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there is no subject matter jurisdiction.

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For the foregoing reasons, IT IS HEREBY RECOMMENDED that:

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1. The action be remanded to San Joaquin County Superior Court, Lodi Branch;

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2. The Clerk be directed to serve a certified copy of this order on the Clerk of the

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San Joaquin County Superior Court, Lodi Branch, and reference the state case number (39-2012-

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00289560-CL-UD-LOD) in the proof of service; and

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3. The Clerk be directed to close this case.
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These findings and recommendations are submitted to the United States District

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Judge assigned to the case, pursuant to the provisions of Title 28 U.S.C. § 636(b)(l). Within

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fourteen (14) days after being served with these findings and recommendations, any party may

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file written objections with the court and serve a copy on all parties. Such a document should be

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captioned “Objections to Magistrate Judge’s Findings and Recommendations.” Any reply to the

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objections shall be served and filed within seven (7) days after service of the objections. The

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parties are advised that failure to file objections within the specified time may waive the right to

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appeal the District Court’s order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).

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DATED: February 27, 2013

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/s/ Gregory G. Hollows
UNITED STATES MAGISTRATE JUDGE

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GGH/076

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WellsFargo0348.rem.wpd

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