Northern Neon Operations, LLC v. Guillermo

Filing 19

ORDER by Judge Edward M. Chen granting 2 Motion for Leave to Proceed in forma pauperis; granting 11 Motion to Remand (bpf, COURT STAFF) (Filed on 9/28/2011)

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1 2 3 4 5 UNITED STATES DISTRICT COURT 6 NORTHERN DISTRICT OF CALIFORNIA 7 8 NORTHERN NEON OPERATIONS, LLC, 9 Plaintiff, 10 v. 11 For the Northern District of California United States District Court No. C-11-4020 EMC GUILLERMO DAMIAN, 12 ORDER GRANTING DEFENDANT’S APPLICATION TO PROCEED IN FORMA PAUPERIS; AND GRANTING PLAINTIFF’S MOTION TO REMAND Defendant. (Docket Nos. 2, 11) 13 ___________________________________/ 14 15 Plaintiff Northern Neon Operations, LLC (“NNO”) initiated this unlawful detainer action in 16 state court. Defendant Guillermo Damian subsequently removed the case to federal court. Currently 17 pending before this Court is Mr. Damian’s application to proceed in forma pauperis and NNO’s 18 motion to remand. Having considered the parties’ briefs and accompanying submissions, the Court 19 hereby GRANTS Mr. Damian’s application to proceed in forma pauperis but remands the case back 20 to the state court from which it was removed for lack of subject matter jurisdiction. For the same 21 reasons, the Court also GRANTS NNO’s motion to remand. 22 23 I. A. DISCUSSION In Forma Pauperis 24 When presented with an application to proceed in forma pauperis, a court must first 25 determine if the applicant satisfies the economic eligibility requirement of 28 U.S.C. § 1915(a). See 26 Franklin v. Murphy, 745 F.2d 1221, 1226 n.5 (9th Cir. 1984). Section 1915(a) does not require an 27 applicant to demonstrate absolute destitution. See McCone v. Holiday Inn Convention Ctr., 797 F.2d 28 853, 854 (10th Cir. 1982) (citing Adkins v. E.I. Du Pont de Nemours & Co., Inc., 335 U.S. 331, 1 339(1948)). Having reviewed Mr. Damian’s financial affidavit, the Court is satisfied that he has 2 demonstrated that he meets the economic eligibility requirement and, accordingly, grants his 3 application to proceed in forma pauperis. 4 B. 5 Subject Matter Jurisdiction Although the Court grants the application, it has a sua sponte obligation to ensure that it has 6 subject matter jurisdiction over a case. See, e.g., Corporate Mgmt. Advisors, Inc. v. Artjen 7 Complexus, Inc., 561 F.3d 1294, 1296 (11th Cir. 2009) (stating that “[a] district court may remand a 8 case sua sponte for lack of subject matter jurisdiction at any time”); Maniar v. Federal Deposit Ins. 9 Corp., 979 F.2d 782, 784-85 (9th Cir. 1992) (noting that a district court has power to remand a case sua sponte when it lacks subject matter jurisdiction); Khan v. Bhutto, No. C-93-4165 MHP, 1993 11 For the Northern District of California United States District Court 10 U.S. Dist. LEXIS 17678, at *1 (N.D. Cal. Dec. 6, 1993) (stating that “[a] court may deny in forma 12 pauperis status under 28 U.S.C. § 1915(d) and dismiss sua sponte a claim . . . over which the court 13 lacks subject matter jurisdiction”). Moreover, NNO has filed a motion to remand, asserting lack of 14 subject matter jurisdiction. 15 The Court agrees with NNO that subject matter jurisdiction is lacking. In his notice of 16 removal, Mr. Damian asserted that there is federal question jurisdiction because NNO has violated 17 federal law, but federal question jurisdiction depends on the contents of the plaintiff’s well-pleaded 18 complaint and may not be predicated on the defendant’s counterclaims. See Holmes Group, Inc. v. 19 Vornado Air Circulation Systems, Inc., 535 U.S. 826 (2002). Moreover, the Court sees no basis for 20 diversity jurisdiction (as Mr. Damian suggests in his opposition to the motion to remand) because 21 diversity jurisdiction requires not only that there must be complete diversity in citizenship but also 22 that the amount in controversy exceed $75,000. See 28 U.S.C. § 1332(a). Here, Mr. Damian has not 23 made any showing that the damages sought by NNO would exceed that amount, and it is unlikely 24 that that would be the case given that, on the face of the complaint, NNO seeks only $51.66 in 25 damages per day as of July 12, 2011, for a total not to exceed $10,000. See Compl. ¶ 11. 26 Accordingly, the Court remands the case to the state court from which it was removed. Any 27 argument that Mr. Damian has that the foreclosure was improper should be made before the state 28 court, which has jurisdiction over the case, and not this Court. 2 1 2 C. Attorney’s Fees and Costs The only issue remaining is whether NNO should be awarded its attorney’s fees and costs 3 incurred as a result of the improper removal. The Court declines to award any fees or costs for the 4 following reasons. First, although NNO has made a request for fees, see Mot. at 1, it has failed to 5 provide any argument or evidence in support of that request. Second, even though the removal was 6 objectively unreasonable, that does not mean that an award of fees or costs is required. See 28 7 U.S.C. § 1447 (providing that “[a]n order remanding the case may require payment of just costs and 8 any actual expenses, including attorney fees, incurred as a result of the removal”) (emphasis added); 9 Martin v. Franklin Capital Corp., 546 U.S. 132, 141 (2005) (stating that, “[a]bsent unusual circumstances, courts may award attorney’s fees under § 1447(c) only where the removing party 11 For the Northern District of California United States District Court 10 lacked an objectively reasonable basis for seeking removal”) (emphasis added). Here, the Court 12 concludes that, under the circumstances, fees are not appropriate, in particular, because Mr. Damian 13 is a pro se litigant and likely unable to pay a fee award given that his home was foreclosed upon. 14 See Deutsche Bank Nat’l Trust Co. v. Cabalu, No. C-10-02624 EDL, 2010 U.S. Dist. LEXIS 15 103585, at *9-10 (N.D. Cal. Sept. 30, 2010) (R&R) (noting that “an award of fees and costs would 16 be appropriate because there was no objectively reasonable basis for removal of this purely state law 17 case” but exercising discretion not to award fees given defendants’ pro se status; also noting 18 representation by one defendant that he was not employed and unable to afford any judgment), 19 adopted by 2010 U.S. Dist. LEXIS 123709 (N.D. Cal. Nov. 22, 2010); OneWest Bank, FSB v. Mohr, 20 No. C 10-00639 SBA, 2010 U.S. Dist. LEXIS 79535, at *9 (N.D. Cal. July 7, 2010) (noting that 21 removal was not objectively reasonable but declining to award fees because defendants were not 22 represented); Szanto v. Szanto, No. C 10-1364 RS, 2010 U.S. Dist. LEXIS 63841, at *5 (N.D. Cal. 23 June 7, 2010) (noting that a pro se litigant’s “lack of understanding as to the specialized procedural 24 hurdles involved in removal jurisdiction is understandable”). Also, the Court cannot say that the 25 removal was necessarily undertaken in bad faith because Mr. Damian apparently intended to assert 26 federal law claims against NNO (e.g., violation of the Truth in Lending Act). See HSBC Bank USA, 27 N.A. v. Tran, No. 5:10-cv-03069-JF/PVT, 2010 U.S. Dist. LEXIS 124999, at *3-4 (N.D. Cal. Nov. 9, 28 2010) (stating that, “[w]hile removal is inappropriate where a complaint rests solely on state law 3 1 claims, in light of Tran’s pro se status and an apparent intent to assert a claim under TILA, the Court 2 declines to award fees here”). The rule that removal cannot be based on a federal defense is not 3 intuitively obvious to a pro se litigant. 4 5 6 II. CONCLUSION For the foregoing reasons, the Court grants Mr. Damian’s application to proceed in forma pauperis but remands the case back to the state court from which it was removed. 7 The Clerk of the Court is directed to close the file in this case. 8 This order disposes of Docket Nos. 2 and 11. 9 IT IS SO ORDERED. 11 For the Northern District of California United States District Court 10 12 Dated: September 28, 2011 13 _________________________ EDWARD M. CHEN United States District Judge 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4 1 UNITED STATES DISTRICT COURT 2 FOR THE 3 NORTHERN DISTRICT OF CALIFORNIA 4 5 6 NORTHERN NEON OPERATIONS, LLC, 7 8 9 Plaintiff, CERTIFICATE OF SERVICE v. GUILLERMO DAMIAN et al, Defendant. / 11 For the Northern District of California United States District Court 10 Case Number: CV11-04020 EMC 12 13 14 15 I, the undersigned, hereby certify that I am an employee in the Office of the Clerk, U.S. District Court, Northern District of California. That on September 28, 2011, I SERVED a true and correct copy(ies) of the attached, by placing said copy(ies) in a postage paid envelope addressed to the person(s) hereinafter listed, by depositing said envelope in the U.S. Mail, or by placing said copy(ies) into an inter-office delivery receptacle located in the Clerk's office. 16 17 18 Damian Guillermo 2160 El Lago Drive Oakley, CA 94561 19 20 21 Dated: September 28, 2011 Richard W. Wieking, Clerk By: Betty Lee, Deputy Clerk 22 23 24 25 26 27 28 5

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