Deutsche Bank National Trust Company v. Speer

Filing 14

ORDER granting 8 Motion to Remand to State Court. See attached order for details. Signed by Judge Robert N. Chatigny on 4/8/2016. (Panchenko, I)

UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
DEUTSCHE BANK NATIONAL TRUST
COMPANY,
Plaintiff,
v.
ELISSA SPEER,
Defendant.

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Case No. 3:16-cv-46(RNC)

RULING AND ORDER
This mortgage foreclosure action is before the Court on a
motion to remand.

Plaintiff argues that subject matter

jurisdiction is lacking and removal was untimely.

I agree and

therefore grant the motion.
I.

Background
Plaintiff filed this action in Connecticut Superior Court in

November 2011.

After several years of litigation, the court

granted summary judgment in plaintiff’s favor.

Defendant’s

attempts to obtain appellate review were unsuccessful.

On

January 15, 2016, two days after the Supreme Court of Connecticut
denied review, the defendant filed an objection to plaintiff’s
motion for a judgment of strict foreclosure, which was marked
“ready” for January 19, 2016, and simultaneously removed the
case.
II.

Analysis
Under 28 U.S.C. § 1441(a), a case may be removed to federal

court only if it could have been brought there originally, in

other words, only if the action arises under federal law or the
parties are citizens of different states.
1332(a).

See 28 U.S.C. §§ 1331,

If removal is based on diversity of citizenship, the

action “may not be removed” if any of the defendants “is a
citizen of the State in which such action is brought.”
§ 1441(b)(2).

28 U.S.C.

Regardless of the asserted basis of jurisdiction,

a defendant must file a notice of removal within 30 days of
receipt of the complaint or other pleading showing that the case
is removable.

See 28 U.S.C. § 1446(b).

This prevents a

defendant from trying a case in state court then seeking a
federal forum after an unfavorable ruling.

Any doubts about

removability must be resolved in favor of remand.

See Purdue

Pharma L.P. v. Kentucky, 704 F.3d 208, 213 (2d Cir. 2013).
Here, removal is not available based on diversity of
citizenship because the defendant is a citizen of Connecticut.
Accordingly, jurisdiction is lacking unless the action “aris[es]
under the Constitution, laws, or treaties of the United States.”
28 U.S.C. § 1331.

“The presence or absence of federal-question

jurisdiction [in a removed case] is governed by the ‘well-pleaded
complaint rule,’ which provides that federal jurisdiction exists
only when a federal question is present on the face of the
plaintiff’s properly pleaded complaint.”
Williams, 482 U.S. 386, 392 (1987).

Caterpillar Inc. v.

“The well-pleaded-complaint

rule mandates that in assessing subject matter jurisdiction, a

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federal court must disregard allegations that a well-pleaded
complaint would not include - e.g., allegations about anticipated
defenses.”

Sullivan v. Am. Airlines, Inc., 424 F.3d 267, 271 (2d

Cir. 2005).

Thus, a federal law issue raised in the defendant’s

answer is not a basis for removal if the complaint itself does
not present a federal question.
Defendant does not contend that the plaintiff’s complaint
presents a federal question.

She argues, however, that the

substantial federal question doctrine applies, citing Grable &
Sons Metal Prods., Inc. V. Darue Eng’g & Mfg., 545 U.S. 308
(2005).

In Grable, the Court held that the national interest in

providing a federal forum for federal tax litigation was
sufficiently important to justify the exercise of federalquestion jurisdiction in a state quiet title action concerning
the validity of the IRS’s seizure of real property to satisfy a
federal tax delinquency.

Id. at 319-20.

Under Grable, “federal

jurisdiction over a state law claim will lie if a federal issue
is: (1) necessarily raised, (2) actually disputed, (3)
substantial, and (4) capable of resolution in federal court
without disrupting the federal-state balance approved by
Congress.”

Gunn v. Minton, 133 S. Ct. 1059, 1065 (2013).

Defendant contends that the substantial federal question
doctrine permits the exercise of jurisdiction because plaintiff
has failed to adhere to the National Housing Act, 12 U.S.C. §

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1701x(c)(5)(A)-(B), which requires a mortgage lender to notify an
eligible homeowner of the availability of homeownership
counseling within forty-five days of a missed payment, and the
Truth in Lending Act, 15 U.S.C. § 1641(g), which requires notice
to the borrower not less than thirty days after a mortgage loan
is sold or otherwise transferred.
Federal courts have recognized that residential mortgage
foreclosure actions do not raise an issue of national importance
justifying the exercise of federal jurisdiction.

See, e.g.,

Citigroup Glob. Mkts. Realty Corp. v. Brown, No. 2:13-CV-1232,
2014 WL 4748615, at *6 (S.D. Ohio Sept. 23, 2014); U.S. Bank Nat.
Ass'n v. May, No. CIV.A. 13-4624 MLC, 2014 WL 2965938, at *3
(D.N.J. July 1, 2014).

That plaintiff might have failed to

comply with notice requirements provided by federal law, as
defendant alleges, does not raise such an issue here.

Moreover,

exercising federal question jurisdiction over actions like this
would disrupt the normal currents of litigation by making a
federal forum available for state mortgage foreclosure actions
between non-diverse parties.

Accordingly, jurisdiction is

lacking.
Even if the substantial federal question doctrine applied in
this case, and I do not believe it does, remand would nonetheless
be necessary if the defendant failed to file a removal notice
within the thirty days permitted by law.

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Plaintiff argues that

removal was woefully untimely, and defendant does not respond to
plaintiff’s argument on this point.

The record establishes that

defendant removed the case long after the thirty day period
expired, following substantial litigation, including summary
judgment motion practice, which resulted in a ruling in favor of
the plaintiff.

Because removal was untimely, the case must be

remanded in any event.1
Plaintiff has asked for an award of fees and costs.

When a

case is remanded, fees are awarded if the removing party did not
have an objectively reasonable basis for removal.

Martin v.

Franklin Capital Corp., 546 U.S. 132, 141 (2005).

Even assuming

the substantial federal question doctrine could be thought to
raise an arguable issue in this case, defendant’s removal of the
action was plainly contrary to the thirty-day limitation.

It is

apparent, moreover, that the case was removed due to the imminent

1

In the notice of removal, the defendant stated that
“removability [was] not apparent from the allegations of an
initial pleading or subsequent document.” Cutrone v. Mortgage
Elec. Registration Sys., Inc., 749 F.3d 137, 143 (2d Cir. 2014).
The notice states that the action was removed within thirty days
of the date on which defendant first realized that “diversity and
subject matter jurisdictional requirements for removal [were]
met.” Notice of Removal (ECF No. 1) ¶ 12. Defendant’s
conclusory statement in the removal notice falls far short of
providing a basis for exercising jurisdiction in the face of the
plaintiff’s objection. As discussed in the text, diversity does
not provide a basis for removal because the defendant is a
citizen of Connecticut, and defendant is relying on asserted
violations of federal notice requirements that occurred before
this action was brought. In any event, by litigating the case
almost to completion in state court, the defendant waived any
right she might have had to a federal forum.
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hearing on the motion for a judgment of strict foreclosure.

In

these circumstances, an award of fees and costs is appropriate.
III. Conclusion
Accordingly, plaintiff’s motion to remand is granted.
Plaintiff will file and serve an affidavit in support of its
application for fees and costs within thirty days.

Defendant

will have fourteen days to respond.
So ordered this 8th day of April 2016.
/s/ RNC
Robert N. Chatigny
United States District Judge

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