Dimitrion et al v. Morgan Stanley Home Loans et al
ORDER DISMISSING COMPLAINT FOR LACK OF SUBJECT MATTER JURISDICTION. Signed by JUDGE DERRICK K. WATSON on 5/29/2014. ~ The Court hereby dismisses the Dimitrions' complaint for lack of subject matter jurisdiction. The Clerk of C ourt is directed to close the case. (ecs, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAI`I
MICHAEL J. DIMITRION,
individually and as Trustee of the
Michael J. Dimitrion Trust dated
November 6, 1989; and TINA MARIE
CIVIL NO. 13-00125 DKW-BMK
COMPLAINT FOR LACK OF
MORGAN STANLEY CREDIT
CORPORATION, et. al.,
ORDER DISMISSING COMPLAINT FOR LACK OF
SUBJECT MATTER JURISDICTION
This matter is nearly identical in relevant part to several other cases in
this district, brought by the same counsel, which have recently been dismissed for
lack of subject matter jurisdiction. See Toledo v. Bank of New York Mellon, et al.,
CV 13-00539 DKW-KSC, Dkt. no. 45 (D. Haw. May 2, 2014); Broyles v. Bank of
America, et al., 2014 WL 1745097 (D. Haw. April 30, 2014); Moore v. Deutsche
Bank Nat’l Trust Comp., et al., 2014 WL 1745076 (D. Haw. April 30, 2014);
Wegesend v. Envision Lending Group, et al., 2014 WL 1745340 (D. Haw. April
30, 2014); Dicion v. Mann Mortgage, LLC, 2014 WL 1366151 (D. Haw. April 4,
2014); Pascua v. Option One Mortgage Corp., 2014 WL 806226 (D. Haw. Feb.
28, 2014). The result here is no different—because the Dimitrions lack standing
and have not satisfied the amount in controversy requirement, this Court lacks
subject matter jurisdiction, mandating dismissal of the amended complaint.
The Dimitrions have taken out six mortgages on their primary
residence, only a few of which are at issue in this matter. The Dimitrions assert a
single cause of action that they refer to as “declaratory judgment,”1 seeking to
obtain a declaration from this Court in order to quiet title and determine what
interest, if any, the Defendants have in the property because the Dimitrions “do not
know to whom they must make their mortgage payments, do not know how much
(if any) is due under the mortgages, and do not know with whom they can
negotiate a modification of their mortgages.” Complaint ¶ 1.
Defendants, the loan servicers on the Dimitrions’ mortgages, move to
dismiss, or in the alternative, move for summary judgment.
STANDARD OF REVIEW
Although Defendants’ motions are filed pursuant to Fed. R. Civ. P.
12(b)(6) and 56, the Court “must determine that [it] ha[s] jurisdiction before
The Dimitrions initially filed a complaint in state court with other counts (including claims
under federal law) that was removed to this Court. However, by stipulation of the parties, the
Dimitrions were permitted to file an amended complaint, which would assert a single “quiet
title” claim. In the Dimitrions’ amended complaint, the title of the claim is “declaratory
judgment,” although the text of the count notes that this is a “quiet title action.” Complaint ¶ 22.
proceeding to the merits.” Lance v. Coffman, 549 U.S. 437, 439 (2007). Thus, the
Court is “obligated to consider sua sponte whether [it] ha[s] subject matter
jurisdiction.” Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1116 (9th Cir. 2004). “If
the court determines at any time that it lacks subject-matter jurisdiction, the court
must dismiss the action.” Fed. R. Civ. P. 12(h)(3).
A suit brought by a plaintiff without Article III standing is not a “case
or controversy,” and an Article III federal court therefore lacks subject matter
jurisdiction over the suit. Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 102
(1998). In order to establish standing, three requirements must be met:
First and foremost, there must be alleged (and ultimately
proved) an injury in fact—a harm suffered by the plaintiff that
is concrete and actual or imminent, not conjectural or
hypothetical. Second, there must be causation—a fairly
traceable connection between the plaintiff’s injury and the
complained-of conduct of the defendant. And third, there must
be redressability—a likelihood that the requested relief will
redress the alleged injury. This triad of injury in fact,
causation, and redressability constitutes the core of Article III’s
case-or-controversy requirement, and the party invoking federal
jurisdiction bears the burden of establishing its existence.
Id. at 102–04 (internal citations and quotation marks omitted). See Takhar v.
Kessler, 76 F.3d 995, 1000 (9th Cir. 1996) (“A plaintiff has the burden of
establishing the elements required for standing.”).
Even where a plaintiff has standing, subject matter jurisdiction must
also be established. Jurisdiction founded on diversity (the basis for jurisdiction
alleged by the Dimitrions here) “requires that the parties be in complete diversity
and the amount in controversy exceed $75,000.” Matheson v. Progressive
Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003) (per curiam); see 28 U.S.C.
§ 1332. Where, as here, declaratory or injunctive relief is sought, it is “‘well
established that the amount in controversy is measured by the value of the object of
the litigation.’” Cohn v. Petsmart, Inc., 281 F.3d 837, 840 (9th Cir. 2002) (quoting
Hunt v. Wash. State Apple Adver. Comm’n, 432 U.S. 333, 347 (1977)). The object
of the litigation is “the value of the right to be protected or the extent of the injury
to be prevented.” Jackson v. Am. Bar Ass’n, 538 F.2d 829, 831 (9th Cir. 1976); see
also Ridder Bros., Inc. v. Blethen, 142 F.2d 395, 399 (9th Cir. 1944) (stating that
the “required amount [in controversy is] the value of the particular and limited
thing sought to be accomplished by the action”).
“[T]he party asserting diversity jurisdiction bears the burden of
proof.” Lew v. Moss, 797 F.2d 747, 749 (9th Cir. 1986).
The Dimitrions lack standing and have failed to satisfy the amount in
controversy requirement necessary to establish diversity jurisdiction. Accordingly,
the Court dismisses the amended complaint for lack of subject matter jurisdiction.
First, the Dimitrions have not alleged an injury in fact to sufficiently
establish standing. Although the Dimitrions assert their general concern that they
“do not know to whom they must make their mortgage payments” without the
Court’s assistance, the Dimitrions do not allege that any Defendant has actually
initiated foreclosure proceedings or that more than one party has actually
demanded payment on the same loan at the same time—allegations necessary to
show actual injury. Consequently, as Judge Seabright concluded in Dicion:
Absent such factual allegations, the potential for multiple
liability or foreclosure is no more than mere speculation and
falls far short of constituting an Article III injury-in-fact. Thus,
Plaintiff's injury is no more than his own uncertainty regarding
which Defendant is entitled to his mortgage payments. Such a
subjective uncertainty is neither sufficiently concrete nor
particularized to constitute an injury-in-fact.
2014 WL 1366151, at *4 (internal citations omitted); see also Pascua, 2014 WL
806226, at *4 (“At most, the injury-in-fact that Pascua suffers is the ‘uncertainty’
he says he has regarding what entity he is supposed to pay. It is not clear that this
subjective feeling of uncertainty is sufficiently concrete and particularized to
constitute an injury-in-fact. It is also not clear that Pascua’s purported injury, such
as it is, is caused by Defendants’ conduct rather than by Pascua’s own apparent
inability to discern the nature of his obligations.” (internal citation omitted));
Broyles, 2014 WL 1745097, at *4 (“[S]ince Plaintiff does not face foreclosure or
multiple liability, any possible future injury is too conjectural or hypothetical, and
her uncertainty of whom to pay is not sufficiently concrete or particularized, to
constitute an injury-in-fact.”). Indeed, the Defendants agree that there is no dispute
as to the roles of each Defendant entity, and there is nothing to even suggest that
the Dimitrions would be subject to liability to more than one party, as they
apparently fear. Having alleged no injury in fact, and the Court declining to allow
the Dimitrions to manufacture one, Plaintiffs lack standing, depriving the Court of
subject matter jurisdiction. Steel Co., 523 U.S. at 102.2
Second, the Court also lacks subject matter jurisdiction because the
amount in controversy requirement to establish diversity jurisdiction has not been
satisfied. The Dimitrions allege that “the amount in controversy is $1,441,620,
which is the fair market value of the Subject Property.” Complaint ¶ 2. However,
as Judge Mollway discussed in Pascua:
Here, the matter Pascua says he wants to accomplish does not
implicate the entire debt or the value of the property. Although
he styles his claim as one to “quiet title,” Pascua does not allege
that he holds title to the property free and clear of any debt
obligation. Nor does Pascua seek to enjoin a foreclosure. In
either such situation, the full debt or the property itself would
be the object of the litigation, because the claimant would be
trying to prevent paying the debt or losing the property.
Pascua, by contrast, asks for a declaration to prevent him from
feeling uncertainty as to whom to pay. He is not actually being
asked to pay his acknowledged debt more than once. The
The Court also adopts the same reasoning and conclusion reached by Judge Seabright in Dicion
for the second and third requirements of standing:
Furthermore, in the absence of a demand for payment from multiple
Defendants, Plaintiff’s uncertainty is not fairly traceable to any challenged
action of the Defendants. Nor is Plaintiff's uncertainty likely to be
redressed by a favorable decision.
2014 WL 1366151, at *5 (alterations, quotation marks, and citation omitted).
amount in controversy is therefore the subjective value to
Pascua of freeing him from that risk. Courts are often
disinclined to speculate as to the monetary value of something
so vague and amorphous as a feeling of uncertainty.
In any event, it is implausible to suggest that the subjective
value to Pascua of such a declaration is greater than $75,000.
Pascua’s primary fear appears to be that he will accidentally
pay the wrong party $41,139.92, which is the amount Wells
Fargo is currently requesting he pay to avert foreclosure. The
harm to Pascua of his fear that he might lose a second payment
of $41,139.92 cannot plausibly be worth in excess of $75,000.
2014 WL 806226, at *5 (internal citations omitted).
Similarly here, the Dimitrions ask for a declaration to clarify their
alleged confusion as to whom to pay. Therefore, the object of the litigation is not
the value of the property, but is instead the value of relieving the Dimitrions’
uncertainty. Dicion, 2014 WL 1366151, at *6. However, the Dimitrions have not
even attempted to prove what the value of that uncertainty is and the Court will not
speculate. In short, “because the true purpose of this action is neither to quiet title
in favor of Plaintiff and against all Defendants, nor to stop an imminent foreclosure
sale, simply requesting such relief cannot transform the object of litigation to the
subject property.” Dicion, 2014 WL 1366151, at *6 n.6.
Finally, the Court notes that even if the Court had subject matter
jurisdiction, “Plaintiffs’ contention that they do not know to whom their debt is
owed is not a basis to ‘quiet title.’” Klohs v. Wells Fargo Bank, N.A., 901
F.Supp.2d 1253, 1261 n.4 (D. Haw. 2012).
The Court hereby dismisses3 the Dimitrions’ complaint for lack of
subject matter jurisdiction. The Clerk of Court is directed to close the case.
IT IS SO ORDERED.
DATED: May 29, 2014 at Honolulu, Hawai‘i.
Dimitrion v. Morgan Stanley Credit Corp., et al.; CV 13-00125 DKW/BMK;
ORDER DISMISSING COMPLAINT FOR LACK OF SUBJECT MATTER
There is no need to remand this action to state court. The question of remand “must be analyzed
on the basis of the pleadings filed at the time of removal without reference to subsequent
amendments.” Sparta Surgical Corp. v. Nat’l Ass’n of Securities Dealers, Inc., et al., 159 F.3d
1209, 1213 (9th Cir. 1998). At the time of removal, the Court may have had jurisdiction over
some of the counts asserted in the removed complaint. However, as a result of subsequent
amendment, the Court now lacks jurisdiction and dismisses the single count in the amended
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