Thompson v. JPMorgan Chase Bank, N.A. et al

Filing 29

ORDER (1) TO SHOW CAUSE RE: SUBJECT MATTER JURISDICTION AND (2) VACATING HEARING AND CASE MANAGEMENT CONFERENCE. Responses due by 3/30/2016. Signed by Judge Beth Labson Freeman on 3/18/2016. (blflc2S, COURT STAFF) (Filed on 3/18/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

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DEBBIE A. THOMPSON,

Case No. 15-cv-04885-BLF

Plaintiff,
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v.
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JPMORGAN CHASE BANK, N.A., et al.,
Defendants.

ORDER (1) TO SHOW CAUSE RE:
SUBJECT MATTER JURISDICTION
AND (2) VACATING HEARING AND
CASE MANAGEMENT CONFERENCE
[Re: ECF 1, 28]

United States District Court
Northern District of California

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Plaintiff, a California resident, brought this action asserting exclusively state law claims

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against JPMorgan Chase Bank, N.A. (“Chase”), an Ohio citizen, and Quality Loan Service

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Corporation (“QLS”), a California citizen, in state court. See ECF 1-1, Compl. Chase removed the

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case on the basis of diversity jurisdiction, see ECF 1, Notice of Removal ¶ 4, and then moved to

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dismiss the case. ECF 8.

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Before a federal court can reach the merits of a dispute, it must first confirm that it retains

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subject matter jurisdiction to adjudicate the issue presented. See Steel Co. v. Citizens for a Better

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Environ., 523 U.S. 83, 94–95 (1998). Federal courts are therefore “obliged to inquire sua sponte

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whenever a doubt arises as to the existence of federal jurisdiction.” Mt. Healthy City Sch. Dist. Bd.

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of Educ. v. Doyle, 429 U.S. 274, 278 (1977) (internal citations omitted).

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Such doubt is present here because QLS is a California citizen, which appears to destroy

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diversity. Chase addresses this issue in its Notice of Removal, arguing that QLS, as a trustee, is a

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nominal defendant whose citizenship is therefore irrelevant to the diversity analysis. Notice of

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Removal ¶ 13. However, courts in this district have remanded numerous cases to state court

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because of a trustee’s citizenship—including that of QLS in particular. See, e.g., Newman v. Select

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Portfolio Servicing, Inc., No. C-13-03685 JSC, 2013 WL 5708200 (N.D. Cal. Oct. 21, 2013);

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Hernandez v. First Horizon Loan Corp., No. C 11-00200 SBA, 2011 WL 2531959 (N.D. Cal.

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June 24, 2011). Similarly, courts in this district have remanded cases where, as here, the trustee

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had filed a declaration of non-monetary status in the state action—which allows a trustee not to

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participate in an action if “no objection [to the declaration] is served within . . . 15-day[s],” Cal.

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Civ. Code § 2924l—but the case was removed to federal court before the 15 days ran. See, e.g.,

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Newman, 2013 WL 5708200 at *2; Hernandez, 2011 WL 2531959 at *2; Wise v. Suntrust Mortg.,

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Inc., No. 11-1360 LHK, 2011 WL 1466153, at *4 (N.D. Cal. Apr. 18, 2011).

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United States District Court
Northern District of California

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Accordingly, the Court ORDERS the parties TO SHOW CAUSE why this case should not
be remanded back to Santa Clara County Superior Court for lack of subject matter jurisdiction.
The parties shall each file a brief of no more than five pages on or before March 30, 2016.
In addition, the Court VACATES the hearing for Chase’s Motion to Dismiss and the Initial
Case Management Conference, both set for March 24, 2016.

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IT IS SO ORDERED.

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Dated: March 18, 2016
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BETH LABSON FREEMAN
United States District Judge

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