Loar et al v. Wells Fargo & Company, et al.

Filing 29

Order by Hon. Samuel Conti Granting 17 Motion to Remand and Denying All Other Pending Motions.(sclc2, COURT STAFF) (Filed on 6/12/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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For the Northern District of California

United States District Court

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JOHN LOAR and MONICA LOAR,

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Plaintiffs,
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v.
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WELLS FARGO & COMPANY; WELLS FARGO )
BANK, N.A.,
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Defendants.
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Case No. 12-0430-SC
ORDER GRANTING MOTION TO
REMAND AND DENYING ALL
OTHER PENDING MOTIONS

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I.

INTRODUCTION
This case stems from the pending, but unscheduled, foreclosure

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sale of the Danville residence of Plaintiffs John and Monica Loar

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(collectively, "Plaintiffs").

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action in the Superior Court of the State of California, in and for

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the County of Contra Costa ("Superior Court").

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Ex. A ("Compl.").

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("Wells & Co.") and Wells Fargo Bank, N.A. ("Wells N.A.")

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(collectively, "Defendants") removed to this Court.

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Plaintiffs have since filed an Amended Complaint.

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Compl.").

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Plaintiffs originally filed this

ECF No. 1 ("NOR")

Soon after, Defendants Wells Fargo & Company

A flurry of motions followed.

NOR at 1.

ECF No. 16 ("Am.

Defendants move to dismiss the

Amended Complaint, and to strike certain claims and allegations

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within it.

ECF No. 20 ("MDS").

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case back to Superior Court.

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their Motion to Remand with a Request for Judicial Notice of a

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webpage purporting to show the California citizenship of Wells &

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Co.

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fees they have incurred challenging removal.

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Additionally, Plaintiffs move for a preliminary injunction staying

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further foreclosure proceedings until after trial.

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Finally, Plaintiffs, who failed to oppose Defendants' Motions to

ECF No. 17-2.

Plaintiffs move to remand this

ECF No. 17 ("MTR").1

They supplement

Plaintiffs also seek to recoup the attorney
Mot. to Remand at 9.

ECF No. 15.

United States District Court

For the Northern District of California

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Dismiss and Strike the Amended Complaint, seek permission for late

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filing of an opposition brief.

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ask the Court to defer ruling on the Motion to Dismiss until after

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the Court decides the Motion to Remand.

ECF No. 26.

Alternatively, they

Id. at 2.

As detailed below, the Court GRANTS Plaintiffs' Motion to

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Remand.

The Court DENIES Plaintiffs' request for attorney fees

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connected to the Motion to Remand.

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currently scheduled, the Court DENIES Plaintiffs' Motion for a

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Preliminary Injunction enjoining the sale.

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Motions are DENIED as moot.

Because no foreclosure sale is

All other pending

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II.

DISCUSSION
If a federal court would have had diversity jurisdiction over

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a civil action, but the plaintiff chooses to sue in state court

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instead, defendants may remove the case to federal court.

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U.S.C. § 1441(a).

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removal, the usual requirements of diversity jurisdiction must be

See 28

In addition to the procedural requirements of

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The Motion to Remand is fully briefed.
("Reply").

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ECF Nos. 19 ("Opp'n"), 23

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satisfied, i.e., complete diversity between the parties and an

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amount in controversy which exceeds $75,000.

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(citing id. § 1332(a)).

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leave from any court or from plaintiffs.

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Plaintiffs seeking to test the propriety of removal must file a

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motion in federal court, asking that the case be remanded to the

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state court where plaintiffs originally sued.

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Alaska Airlines, Inc., 553 F.3d 1241, 1244 (9th Cir. 2009).

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removal statute is strictly construed, with any doubts resolved in

See id. § 1441(b)

Defendants may remove without seeking
See id. § 1441(a).

See Moore–Thomas v.
The

Id. (citing Gaus v. Miles, Inc., 980 F.2d 564,

United States District Court

For the Northern District of California

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favor of remand.

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566 (9th Cir. 1992)).

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that removal was proper.

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defendant's decision to remove means that district courts decide

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motions to remand by looking only at the original state court

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complaint, not any subsequent amendments.

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Corp. v. Nat'l Ass'n of Sec. Dealers, Inc., 159 F.3d 1209, 1213

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(9th Cir. 1998).

Defendants bear the burden of establishing
Id.

This focus on the propriety of a

See Sparta Surgical

Here, Plaintiffs do not dispute that the amount-in-controversy

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requirement is satisfied.

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diversity is lacking.

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complete diversity exists only if no "properly joined and served"

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defendant is also a California citizen.

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1441(b)(2).

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Wells N.A., Wells & Co. is a California citizen whose presence in

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the case prevents Defendants from satisfying the requirement of

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complete diversity.2

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Instead, they argue that complete

Because Plaintiffs are California citizens,

See 28 U.S.C. §

Plaintiffs argue that, whatever the citizenship of

MTR at 1, 6.

Plaintiffs also argue that Wells N.A., too, is a California
citizen -- not, as Defendants say, a South Dakota citizen. MTR at
6-7. Alternatively, Plaintiffs urge the Court to abstain from

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As Plaintiffs point out, the Notice of Removal conflates the

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two Defendants.

NOR at 1.

The Notice of Removal then describes

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this grouping as a South Dakota citizen.

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Defendants cite cases that address only the citizenship of Wells

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N.A., not Wells & Co.

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749 F. Supp. 2d 1022 (N.D. Cal. 2010) (Wells N.A. named as

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defendant, but not Wells & Co.); DeLeon v. Wells Fargo Bank, N.A.,

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729 F. Supp. 2d 1119 (N.D. Cal. 2010) (same).

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Defendants on this very point.

Id.

In doing so,

See Ngoc Nguyen v. Wells Fargo Bank, N.A.,

MTR at 1, 6.

Plaintiffs challenge
But Defendants

United States District Court

For the Northern District of California

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entirely fail to respond to the argument, or even acknowledge that

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it has been made.

See generally Opp'n.

Resolving all doubts in favor of remand, the Court takes

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Defendants' silence as a concession.

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for instance, that Wells & Co. has not been "properly joined," as

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required by 28 U.S.C. § 1441(b)(2).

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the line between Wells & Co. and Wells N.A. is a distinction

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without a difference.

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length how this circuit's district courts have split over the

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question of whether Wachovia Bank v. Schmidt, 546 U.S. 30 (2006),

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abrogated a Ninth Circuit case upon which Plaintiffs rely, American

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Surety Co. v. Bank of California, 133 F.2d 160 (9th Cir. 1943).

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MTR Opp'n at 3 (citing cases); see also Flores v. Wells Fargo Bank,

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N.A., 3:11-CV-06619, 2012 WL 832546 (N.D. Cal. Mar. 12, 2012)

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(describing split).

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Defendants might have argued,

Or they might have argued that

They do neither.3

Instead, they discuss at

But, as in the Notice of Removal, the cases

exercising its removal jurisdiction, citing Quackenbush v. Allstate
Insurance Co., 517 U.S. 706 (1996). Because the Court disposes of
the Motion on other grounds, it does not reach these arguments.
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The Court expresses no view on the merits of those arguments, and
mentions them only to illustrate why Defendants' failure to raise
any counterargument at all amounts to a concession.

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cited in the opposition brief address only the citizenship of Wells

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N.A., not Wells & Co.

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2011 WL 6372637 (N.D. Cal. Dec. 20, 2011) (Wells N.A. named as

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defendant, but not Wells & Co.); Tse v. Wells Fargo Bank, N.A.,

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C10-4441 TEH, 2011 WL 175520 (N.D. Cal. Jan. 19, 2011) (same);

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Atienza v. Wells Fargo Bank, N.A., C 10-03457 RS, 2011 WL 11507

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(N.D. Cal. Jan. 4, 2011) (same).

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nonresponsive to Plaintiffs' argument that Wells & Co.'s presence

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in the action makes removal improper.

United States District Court

The Court finds these cases to be

Defendants also cite to Magistrate Judge Corley's well-

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For the Northern District of California

See Moreno v. Wells Fargo, C-11-05189 EDL,

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reasoned opinion in Flores.

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does nothing to help them.

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reasons why Northern District courts have recognized the abrogation

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of American Surety by Schmidt, but it does not speak to the premise

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of Plaintiffs' challenge: that Wells & Co. is a distinct legal

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entity from Wells N.A., with its own distinct citizenship.

MTR Opp'n at 2.

But that case, too,

Flores persuasively sets forth the

The Court is required to resolve any doubts in favor of

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remand.

Gaus, 980 F.2d at 566.

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Plaintiffs, who bear the burden of showing that removal was proper.

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See id.

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the Court GRANTS Plaintiffs' Motion to Remand and REMANDS this case

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to Superior Court.4

And it is Defendants, not

Defendants have not carried their burden.

Accordingly,

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Though the Court does not rely on it in reaching its decision to
remand this case, the Court agrees with Plaintiffs' observation
that the policy consideration which normally justifies the exercise
of removal jurisdiction based on diversity -- protection of an outof-state defendant from "hometown favoritism" -- is not present
here. Reply at 4-5. "Wells Fargo is an iconic California
institution." Leyva v. Wells Fargo Bank N.A., CV 12-00708 DMG
(SHx), 2012 U.S. Dist. LEXIS 30892, at *6 (C.D. Cal. Mar. 7, 2012).

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The Court DENIES Plaintiffs' request for attorney fees

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pursuant to 28 U.S.C. § 1447(c).

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that a district court "may" award costs and fees incurred as a

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result of removal.

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here as one on which reasonable minds could not "conceivably"

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disagree, but that overstates the matter.

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authority regarding Wells N.A., Defendants could reasonably have

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concluded that they had proper grounds to remove.

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accordingly declines to award costs and fees here.

United States District Court

For the Northern District of California

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That code section provides only

Plaintiffs characterize the issue presented

Given the split of

The Court

The Court also DENIES Plaintiffs' Motion for a Preliminary

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Injunction.

To be entitled to injunctive relief, Plaintiffs must

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show that they face a threat of irreparable harm that is "real or

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immediate."

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254 F.3d 846, 850 (9th Cir. 2001) (citing Hodgers–Durgin v. De La

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Vina, 199 F.3d 1037, 1042 (9th Cir. 1999)).

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Plaintiffs could satisfy this imminence requirement, despite there

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being no scheduled date for the foreclosure sale, this Court

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perceives no reason why Plaintiffs could not seek a temporary

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restraining order from the state court if the need arose.

Midgett v. Tri-County Metro. Transp. Dist. of Oregon,

Even assuming that

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III. CONCLUSION
For the foregoing reasons, the Court GRANTS Plaintiffs' Motion

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to Remand and REMANDS this case to the Superior Court of the State

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of California in and for the County of Contra Costa.

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DENIES Plaintiffs' request for attorney fees connected to the

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Motion to Remand.

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currently scheduled, the Court DENIES Plaintiffs' Motion for a

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Preliminary Injunction enjoining the sale.

The Court

Further, because no foreclosure sale is

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All other pending

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motions, as well as the Request for Judicial Notice, are DENIED as

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moot.

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Pursuant to 28 U.S.C. § 1447(c), the Clerk of this Court shall

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mail a certified copy of this Order to the clerk of the Superior

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Court of the State of California in and for the County of Contra

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Costa.

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IT IS SO ORDERED.

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United States District Court

For the Northern District of California

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Dated: June 12, 2012
UNITED STATES DISTRICT JUDGE

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