Deutsche Bank National Trust Company v. Dolan

Filing 6

FINDINGS and RECOMMENDATIONS signed by Magistrate Judge Gregory G. Hollows on 11/21/2014 RECOMMENDING that this action be remanded to Butte County Superior Court. Referred to Judge Troy L. Nunley. Objections due within 14 days after being served with these findings and recommendations. (Donati, J)

1
2
3
4
5
6
7

UNITED STATES DISTRICT COURT

8

FOR THE EASTERN DISTRICT OF CALIFORNIA

9
10
11

DEUTSCHE BANK NATIONAL TRUST
COMPANY,
Plaintiff,

12
13
14
15

No. 2:14-cv-2591 TLN GGH PS

FINDINGS AND RECOMMENDATIONS
v.
EILEEN DOLAN,
Defendant.

16
17

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

18

removed from state court on November 5, 2014 by defendant, based on federal question

19

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

20

[a] removed action sua sponte, whether the parties raised the issue or not.” United Investors Life

21

Ins. Co. v. Waddell & Reed Inc., 360 F.3d 960, 966 (9th Cir. 2004); see also Kelton Arms

22

Condominium Assoc., Inc. v. Homestead Ins. Co., 346 F.3d 1190, 1192 (9th Cir. 2003). Because

23

subject matter jurisdiction may not be waived by the parties, a district court must remand a case if

24

it lacks jurisdiction over the matter. Kelton Arms Condominium Owners Ass’n, Inc., 346 F.3d at

25

1192 (citing Sparta Surgical Corp. v. Nat’l Ass’n of Sec. Dealers, Inc., 159 F.3d 1209, 1211 (9th

26

Cir. 1998)); see also 28 U.S.C. § 1447(c) (“If at any time before final judgment it appears that the

27

district court lacks subject matter jurisdiction, the case shall be remanded”). Having reviewed the

28

notice of removal, the court finds that the action should be remanded to state court due to lack of
1

1

subject matter jurisdiction.

2

Removal jurisdiction statutes are strictly construed against removal. See Libhart v. Santa

3

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

4

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

5

566 (9th Cir. 1992). “The burden of establishing federal jurisdiction falls on the party invoking

6

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

7

on other grounds by Leeson v. Transamerica Disability Income Plan, 671 F.3d 969, 979 (9th Cir.

8

2012).

9

A plaintiff may bring suit in federal court if his claim “arises under” federal law. 28

10

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

11

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

12

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

13

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

14

that is, federal jurisdiction.

15

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

16

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

17

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

18

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

19

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

20

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

21

insufficient to permit removal. See Smith v. Industrial Valley Title Ins. Co., 957 F.2d 90, 93 (3rd

22

Cir. 1992) (“[T]he mere presence of a federal issue in a state cause of action does not

23

automatically confer federal question jurisdiction”). Also, defenses and counterclaims cannot

24

provide a sufficient basis to remove an action to federal court. See Vaden v. Discover Bank, 556

25

U.S. 49, 60, 129 S. Ct. 1262, 173 L.Ed.2d 206 (2009); Berg v. Leason, 32 F.3d 422, 426 (9th Cir.

26

1994); Takeda v. Northwestern Nat’l. Life Ins. Co., 765 F.2d 815, 821–22 (9th Cir. 1985); FIA

27

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

28

removed by defendant on the basis that defendant’s counterclaim raised a federal question).
2

1

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

2

nothing more than a simple unlawful detainer action, and is titled as such. (See ECF No. 1, at pp.

3

5-12.) This court has no jurisdiction over unlawful detainer actions which are strictly within the

4

province of the state court. Defendant’s removal petition asserts federal jurisdiction “based upon

5

a notice which expressly references and incorporates the ‘Protecting Tenants at Foreclosure Act

6

of 2009,’ 12 U.S.C. § 5201.” (ECF No. 1 at 3.) Such averments do not establish federal question

7

jurisdiction, especially since the complaint and supporting exhibits, including the aforementioned

8

notice, contain no mention of this act. The state court pleadings and papers accompanying the

9

removal notice establish that the state court action is nothing more than an unlawful detainer

10

action, and is titled as such. (See ECF No. 1 at 5–12.) Plaintiff, the apparent owner of the subject

11

real property in Butte County, California, filed suit in the Butte County Superior Court on July

12

15, 2014, seeking to evict defendant from the property. (Id. at 9-11.) This court has no

13

jurisdiction over unlawful detainer actions, which are brought pursuant to state law and fall

14

strictly within the province of the state court.1

15

Furthermore, while defendant may seek to raise counterclaims based on federal law in

16

response to plaintiff's unlawful detainer claim, any counterclaim based on federal law must

17

generally be raised in the state court action and does not provide a basis for removal. “[A] federal

18

counterclaim, even when compulsory, does not establish ‘arising under’ jurisdiction.” Id. In

19

other words, federal question jurisdiction under 28 U.S.C. § 1331 cannot “rest upon an actual or

20

anticipated counterclaim.” Id.; see also Holmes Grp., Inc. v. Vornado Air Circulation Sys., Inc.,

21

535 U.S. 826, 830, 122 S. Ct. 1889, 153 L.Ed.2d 13 (2002) (“[T]he well-pleaded complaint rule,

22

properly understood, [does not] allo[w] a counterclaim to serve as the basis for a district court’s

23

‘arising under’ jurisdiction.”); Franchise Tax Bd. of Cal. v. Construction Laborers Vacation Trust

24

for Southern Cal., 463 U.S. 1, 10–11, n. 9, 103 S. Ct. 2841, 77 L.Ed.2d 420 (1983) (“The well-

25

pleaded complaint rule applies to the original jurisdiction of the district courts as well as to their

26

removal jurisdiction.”). Accordingly, based on defendant’s removal filing, federal question

27
28

1

Moreover, the Ninth Circuit has held that no private right of action exists under the Protecting
Tenants…Act. Logan v. U.S. Bank Nat. Assoc., 722 F.3d 1163, 1170 (9th Cir. 2013).
3

1

jurisdiction is not present in this case. See also Deutsche Bank Nat. Trust Co. v. Ghosal, 2014

2

WL 5587199 (S.D. Cal. 2014).

3

Additionally, defendant does not argue or otherwise show that removal is proper on the

4

basis of diversity jurisdiction. Defendant states in her state court answer to plaintiff’s complaint,

5

which is attached to the notice of removal, that she is a citizen of California. (See ECF No. 1 at

6

3.) Therefore, defendant cannot remove the action from a California state court on the basis of

7

diversity jurisdiction. See 28 U.S.C. § 1441(b)(2) (“A civil action otherwise removable solely on

8

the basis of [diversity jurisdiction] may not be removed if any of the parties in interest properly

9

joined and served as defendants is a citizen of the State in which such action is brought.”)

10

(emphasis added); Local Union 598, Plumbers & Pipefitters Industry Journeymen & Apprentices

11

Training Fund v. J.A. Jones Const. Co., 846 F.2d 1213, 1215 (9th Cir.1988) (“[F]or diversity

12

removal to be proper, none of the defendants may be a citizen of the state in which the action is

13

brought.”) (citing 28 U.S.C. § 1441(b)).

14

Moreover, even assuming the parties are from different states, and defendant is not a

15

citizen of California, for diversity jurisdiction the amount in controversy must exceed $75,000.

16

Defendant does not assert that the amount in controversy exceeds $75,000 in this case. Even if

17

she made such a claim, she is informed that the measure of damages is limited to the amount

18

sought in the complaint, not the value of the property. Signet Doman, LLC v. Sam Aintablian,

19

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

20

subject property as well as restitution in an unnamed amount, as well as damages for every day

21

that defendant remains in possession of the property. (See ECF No. 1, at p. 11.) These requested

22

damages do not satisfy the amount in controversy requirement.

23

Defendant has not provided a sufficient basis to remove the action to federal court. Based

24

on the aforementioned analysis, the court finds that remand is appropriate, because there is no

25

subject matter jurisdiction.

26

For the foregoing reasons, IT IS HEREBY RECOMMENDED that:

27

1. The action be remanded to Butte County Superior Court;

28

/////
4

1

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

2

County Superior Court, and reference the state case number (NC54979) in the proof of service;

3

and

4

3. The Clerk be directed to close this case.

5

These findings and recommendations are submitted to the United States District Judge

6

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

7

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

8

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

9

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

10

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

11

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

12

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

13

Dated: November 21, 2014

14

/s/ Gregory G. Hollows

15

UNITED STATES MAGISTRATE JUDGE

16

GGH:076/Deutsche2591.rem

17
18
19
20
21
22
23
24
25
26
27
28
5