PARK SOUTHERN NEIGHBORHOOD CORPORATION v. VESTA MANAGEMENT CORPORATION
MEMORANDUM OPINION. Signed by Judge Reggie B. Walton on February 20, 2015. (lcrbw2)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
PARK SOUTHERN NEIGHBORHOOD
Civil Action No. 14-1675 (RBW)
VESTA MANAGEMENT CORPORATION,
This opinion resolves an order to show cause, issued by this Court on January 29, 2015,
which required the parties to show cause why this case should not be remanded to the Superior
Court of the District of Columbia (“Superior Court”) on the ground that the Court lacks subjectmatter jurisdiction to entertain this matter. After careful consideration of the District of
Columbia and the District of Columbia Department of Housing and Community Development’s
(collectively, “District”) response to the Court’s order,1 as well as the parties’ oral arguments and
representations at the various status conferences conducted throughout this case,2 for the reasons
discussed herein, the Court must remand the case back to the Superior Court because it lacks
The plaintiff filed no response to the District’s brief. The Court, therefore, presumes that the plaintiff either
concurs with the District’s response to the Court’s order or does not oppose remand.
The Court considered the following documents in rendering its decision: (1) the Complaint (“Compl.”); (2) the
Notice of Removal (“Removal Notice”); (3) the First Amended Complaint (“First Am. Compl.”); (4) the Motion to
Join Defendant[s] (“Joinder Mot.”); (5) the Second Amended Complaint (“Second Am. Compl.”); and (6)
Defendants District of Columbia and District of Columbia Department of Housing and Community Development’s
Response to [the] Court’s January 29, 2015 Order to Show Cause Why This Case Should Not be Remanded to the
Superior Court of the District of Columbia for Lack of Diversity Jurisdiction (“District Remand Resp.”).
On September 17, 2014, the plaintiff, Park Southern Neighborhood Corporation, a nonprofit entity, which represents that its “primary purpose is to make adequate housing available to
poor and underprivileged residents of the Park Southern neighborhood of Washington, DC, and
provide ancillary and supportive services to such residents,” filed this civil action in the Superior
Court against defendant Vesta Management Corporation (“Vesta”), a “property management
firm,” asserting that Vesta has unlawfully converted the plaintiff’s real property and tortiously
interfered with the plaintiff’s contractual and business relationships with various third parties.
Compl. ¶¶ 6, 7, 31-43; First Am. Compl. ¶¶ 6, 7, 32-44. The plaintiff also moved for a
temporary restraining order and a preliminary injunction against Vesta. See, e.g., Removal
Notice ¶ 4. While a hearing on the plaintiff’s motion was already underway in the Superior
Court, on October 7, 2014, Vesta removed the case to this Court on the basis of diversity
jurisdiction. See id. ¶¶ 6-16; Docket Sheet (ECF No. 2) at 2-5.
After Vesta removed the case from the Superior Court, the plaintiff filed an amended
complaint on November 2, 2014. See First Am. Compl. at 11. At a status hearing held on
November 20, 2014, the Court expressed its concern that the plaintiff necessarily had to join the
District to the matter before the Court could hold a hearing on the plaintiff’s motion for
preliminary relief.3 See November 20, 2014 Minute Entry. Thereafter, the plaintiff moved to
join the District, see Joinder Mot. at 1,4 and the Court granted the motion, see January 15, 2015
Order at 1. The second amended complaint was filed on January 15, 2015. See Second Am.
The parties agreed that joinder of the District would be appropriate.
The plaintiff moved to join the District under Federal Rule of Civil Procedure 20, whereas the Court previously
suggested to the parties that joinder of the District was necessary under Federal Rule of Civil Procedure 19.
Nevertheless, the mechanism by which the District joined the case is irrelevant to the remand analysis below.
Compl. at 14. On January 28, 2015, the Court held another status hearing, when, inter alia, it
recognized that the joinder of the District had destroyed diversity jurisdiction, and thus it no
longer had subject-matter jurisdiction over the case. See January 28, 2015 Minute Entry. The
District took exception with the Court’s position, whereupon the Court permitted the District to
brief the issue.5 See January 29, 2015 Order at 1.
Pursuant to 28 U.S.C. §§ 1441, 1446 (2012), the defendants in a civil action in a state
court may remove an action to a United States district court provided that the action could have
originally been brought in the district court. Upon the timely filing of a notice of removal, the
defendants “bear the burden of proving that jurisdiction exists in federal court.” Downey v.
Ambassador Dev., LLC, 568 F. Supp. 2d 28, 30 (D.D.C. 2008). “If after removal the plaintiff
seeks to join additional defendants whose joinder would destroy subject[-]matter jurisdiction, the
[C]ourt may deny joinder, or permit joinder and remand the action to the State court.” 28 U.S.C.
§ 1447(e); see also id. § 1447(c) (“If at any time before final judgment it appears that the district
court lacks subject[-]matter jurisdiction, the case shall be remanded.”); Republic of Venezuela v.
Philip Morris Inc., 287 F.3d 192, 196 (D.C. Cir. 2002) (finding that “[w]hen it appears that a
district court lacks subject[-]matter jurisdiction over a case that has been removed from a state
court, the district court must remand the case”).
Specifically, “the presence or absence of federal-question jurisdiction is governed by the
‘well-pleaded complaint rule,’ which provides that federal jurisdiction exists only when a federal
question is presented on the face of the plaintiff’s properly pleaded complaint.” Rivet v. Regions
Bank of La., 522 U.S. 470, 475 (1998) (internal alteration and quotation marks omitted); see also
To the extent the plaintiff disagreed with the District, it could have filed a response. See January 29, 2015 Order
Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987) (same); Merrell Dow Pharms., Inc. v.
Thompson, 478 U.S. 804, 809 n.6 (1986) (“Jurisdiction may not be sustained on a theory that the
plaintiff has not advanced.”); Wis. Dep’t of Corr. v. Schacht, 524 U.S. 381, 390 (1998) (“The
status of the case as disclosed by the plaintiff’s complaint is controlling in the case of a removal,
since the defendant must file his petition before the time for answer or forever lose his right to
remove.” (internal alteration and quotation marks omitted)). The “well-pleaded complaint rule”
recognizes that the plaintiff is “master of the claim” and may rely exclusively on state law to
avoid federal question jurisdiction. Caterpillar, 482 U.S. at 392; see also Vaden v. Discover
Bank, 556 U.S. 49, 60 (2009) (“Under the longstanding well-pleaded complaint rule . . . a suit
‘arises under’ federal law ‘only when the plaintiff’s statement of his own cause of action shows
that it is based upon [federal law].’” (quoting Louisville & Nashville R. Co. v. Mottley, 211 U.S.
149, 152 (1908)); Grable & Sons Metal Prods., Inc. v. Darue Eng’g & Mfg., 545 U.S. 308, 312
(2005) (“federal-question jurisdiction is invoked by and large by plaintiffs pleading a cause of
action created by federal law”). And “[c]ourts in [the District of Columbia] [C]ircuit have
construed removal jurisdiction strictly, favoring remand where the propriety of removal is
unclear.” Ballard v. District of Columbia, 813 F. Supp. 2d 34, 38 (D.D.C. 2011); see also Mizell
v. SunTrust Bank, 26 F. Supp. 3d 80, 84 (D.D.C. 2014) (discussing how “‘[c]ourts must strictly
construe removal statutes,’ and ‘must resolve any ambiguities concerning the propriety of
removal in favor of remand’” (quoting Busby v. Capital One, N.A., 841 F. Supp. 2d 49, 53
There is no dispute that the Court was divested of subject-matter jurisdiction on the basis
of diversity when the plaintiff joined the District as a defendant in this case. See District
Remand Resp. at 1 (“[A]s discussed herein, diversity jurisdiction no longer exists . . . .”); id. at 3
(“The District’s joinder, therefore, has eliminated the Court’s diversity jurisdiction over this
case.”). Nevertheless, the District insists that the second amended complaint sufficiently pleads
a federal question.6 See id. at 3. This argument is meritless.
In the second amended complaint, the plaintiff has only alleged District of Columbia
common law claims for unlawful conversion, tortious interference with business and contractual
relationships, and civil conspiracy against the defendants. Second Am. Compl. ¶¶ 36-56. It has
neither asserted a claim nor sought relief under the United States Constitution, a federal statute,
or a United States treaty. See 28 U.S.C. § 1441(c)(1)(A) (citing 28 U.S.C. § 1331 (2012), which
provides district courts federal-question jurisdiction when a civil action “arise[s] under the
Constitution, laws, or treaties of the United States”). Therefore, under the “well-pleaded
complaint rule,” as the “master” of its claims, the plaintiff has chosen to rely exclusively on state
law to avoid federal-question jurisdiction.
Notwithstanding this straightforward application of the “well-pleaded complaint rule,”
the District argues that the plaintiff “has at all times averred that it sues upon one or more
constitutional violations.” District Remand Resp. at 3. In particular, the District “underst[ands]”
the plaintiff “to [be] assert[ing] a claim for [the] taking of [its] property without just
compensation in violation of the Fifth Amendment.” Id. But this is nothing more than
speculation, see id. at 3 (stating that the plaintiff’s multiple complaints are “not models of
clarity” (emphasis added)), as the second amended complaint only mentions “constitutional
violations” once in passing,7 see Second Am. Compl. at 1 (“This is a civil action seeking
Although the Court’s decision to remand this case is driven by its review of the second amended complaint, as that
is the operative complaint at issue, a review of the plaintiff’s initial complaint and first amended complaint would
not yield a different outcome.
Notably, the plaintiff has now had two opportunities to amend the complaint and has yet to assert a constitutional
compensatory and punitive damages against the [d]efendants for unlawful conversion of
property, and tortious interference with business relationship[s] and other conduct all in violation
of District of Columbia statutory laws, common law, and constitutional law.”). Aside from this
lone reference in the introductory paragraph of the second amended complaint, the plaintiff never
identifies the “Fifth Amendment,” let alone alludes to the United States Constitution again in the
This case is akin to Stein v. Am. Express Travel Related Servs., 813 F. Supp. 2d 69
(D.D.C. 2011). There, faced with a motion to remand the case back to the Superior Court, the
Court entertained the argument that there was federal-question jurisdiction based on the
complaint’s “references to the Fourth Amendment.” Id. at 72. Applying the “well-pleaded
complaint rule,” the Court rejected the argument, finding that the “[p]laintiffs ha[d] not [pleaded]
any violation of the Fourth Amendment,” “[n]or d[id] they seek any relief under the Fourth
Amendment.” Id. Likewise, not once does the plaintiff here assert a constitutional claim or seek
any relief based on the Constitution.9 Rather, the only claims that have been “well-pleaded” are
District of Columbia common law claims of unlawful conversion of personal property, tortious
interference, and civil conspiracy. Second Am. Compl. ¶¶ 36-56. Consequently, it is improper
for this Court to exercise subject-matter jurisdiction over the case. See Firstenberg v. City of
Santa Fe, N.M., 696 F.3d 1018, 1026-28 (10th Cir. 2012) (passing mention of violation of the
Constitution did “not pass jurisdictional muster” because it did not “satisfy the well-pleaded
complaint rule, for purposes of demonstrating federal-question jurisdiction”); Rossello-Gonzalez
It seems inherently contradictory for the District to apply the “well-pleaded complaint rule” to the plaintiff’s
multiple complaints that it contends on the one hand are “not models of clarity,” while arriving at an outcome that is
at odds with the conclusion reached by the Court. District Remand Resp. at 2-3.
Moreover, in Stein, the complaint at least identified a constitutional amendment—the Fourth Amendment—as the
basis of a potential constitutional violation. 813 F. Supp. 2d at 72. Here, the District is left to surmise that the
plaintiff is potentially asserting a Fifth Amendment claim. See District Remand Resp. at 3.
v. Calderon-Serra, 398 F.3d 1, 10-11 & n.26 (1st Cir. 2004) (“allegations of violations of ‘due
process’ and ‘equal protection’” did not “present a claim under the Federal Constitution”
because there was “[n]o explicit reference to the United States Constitution . . . contained in the
complaint”); Easton v. Crossland Mortg. Corp., 114 F.3d 979, 982 (9th Cir. 1997) (reversing the
district court and ordering it to remand the case to state court where “the plaintiffs alleged state
law claims which included incidental reference to a federal statute and the U.S. Constitution” and
“[t]he remedies sought were founded exclusively on state law”); Hood v. Foster, 928 F.2d 1135,
1135 (7th Cir. 1991) (“Nowhere on the face of his complaint does [the plaintiff] make reference
to the United States Constitution or to any federal laws. Although [the plaintiff]’s complaint
uses language from [42 U.S.C. § 1983 (1988)], ‘under color of state law,’ he has not alleged a
violation of a federal right.”); cf. Warthman v. Genoa Twp. Bd. of Trs., 549 F.3d 1055, 1064 (6th
Cir. 2008) (holding that award of attorney’s fees may be appropriate because it was not
objectively reasonable for the defendant to have “rested removal on an isolated mention of the
Fourteenth Amendment in a carefully drafted complaint that [pleaded] only state-law claims”).
The District’s reliance on Araya v. JPMorgan Chase Bank, N.A., 775 F.3d 409 (D.C. Cir.
2014), is misplaced. In Araya, the pro se plaintiff filed suit in Superior Court alleging, inter alia,
that “Fannie Mae was . . . a party that ‘upon information and belief had an interest in the
property” at issue, 775 F.3d at 415 (certain ellipses and alterations omitted), and “it is settled law
in [the District of Columbia] Circuit that 12 U.S.C. § 1723a(a) ordinarily creates federal
jurisdiction ‘in Fannie Mae cases,’” id. (quoting Pirelli Armstrong Tire Corp. Retiree Med.
Benefits Trust ex rel. Fed. Nat’l Mortg. Ass’n v. Raines, 534 F.3d 779, 785 (D.C. Cir. 2008)).
After the case was removed to this Court, another member of the Court denied the plaintiff’s
motion for remand, reasoning that a federal statute conferred jurisdiction on the Court. Id.
“However, after the denial of the motion to remand, counsel . . . representing Fannie Mae . . .
moved to dismiss the claim against Fannie Mae, informing the District Court for the first time
that there was no basis for Fannie Mae’s inclusion in this controversy.” Id. “The documents
attached to [the plaintiff]’s Superior Court complaint ma[d]e it clear that the property in [in
dispute] was purchased . . . by . . . Freddie Mac,” and the plaintiff “apparently mistook Freddie
Mac for Fannie Mae.” Id. “The presence of Fannie Mae in th[e] suit [was] therefore entirely
illusory.” Id. Nevertheless, the Circuit found that “[o]n the particular facts presented in this
appeal—in which a pro se D.C. resident accidentally named the wrong federally chartered
corporation as a potentially interested party in his suit against defendants residing outside the
District of Columbia and then sought to correct that mistake by naming the correct federally
chartered corporation—we are satisfied that the District Court had original jurisdiction.” Id.
Araya is inapposite because the holding was limited to “the particular facts presented . . .
[on] appeal.” Id. (emphasis added). The facts here are not analogous. There, from the face of
the complaint, the district court was able to glean the basis for federal-question jurisdiction. But
here no jurisdictional predicate can be identified in the second amended complaint because the
plaintiff has not pleaded any constitutional claims. Finding no federal-question jurisdiction,10 the
Court must remand the matter to the Superior Court. 28 U.S.C. § 1447(e) (“If after removal the
plaintiff seeks to join additional defendants whose joinder would destroy subject[-]matter
jurisdiction, the court may deny joinder, or permit joinder and remand the action to the State
court.”); LeFande v. Yum Brands, Inc., 238 F. App’x 621, 621 (D.C. Cir. 2007) (remanding case
No party has argued that any of the potential exceptions to the “well-pleaded complaint rule” are applicable. See,
e.g., Wash. Consulting Grp., Inc. v. Raytheon Technical Servs. Co., 760 F. Supp. 2d 94, 100-09 (D.D.C. 2011)
(discussing exceptions). Nor could the parties do so as the exceptions are not applicable to the case.
to the Superior Court because “[w]hen the [plaintiffs] amended their complaint to join . . . a
defendant . . . who is nondiverse from the [plaintiffs], the district court lost subject-matter
jurisdiction, which had been based solely upon diversity of the parties’ citizenship” (citing 28
U.S.C. § 1447(e))).
For the foregoing reasons, the Court concludes that the case must be remanded to the
Superior Court of the District of Columbia for lack of subject-matter jurisdiction.11
SO ORDERED on this 20th day, February 2015.
REGGIE B. WALTON
United States District Judge
With the hope of avoiding further delay in the resolution of the plaintiff’s demand for injunctive relief, and
ultimately the resolution of the case, the Court notes that the Supreme Court has “h[eld] that when a district court
remands a properly removed case because it nonetheless lacks subject-matter jurisdiction, the remand is covered by
[28 U.S.C.] § 1447(c) and thus shielded from review by [28 U.S.C.] § 1447(d).” Powerex Corp. v. Reliant Energy
Servs., Inc., 551 U.S. 224, 232 (2007).
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