Hester v. Horowitz

Filing 29

ORDER DENYING DEFENDANT'S MOTION TO RECONSIDER AMENDED ORDER ADOPTING MAGISTRATE JUDGES FINDINGS AND RECOMMENDATIONS re 23 Motion for Reconsideration. Signed by JUDGE LESLIE E. KOBAYASHI on 04/28/2017. -- Defendants M otion to Reconsider Amended Order Adopting Magistrate Judge's Findings and Recommendations, filed March 3, 2017, is HEREBY DENIED. This Court DIRECTS the Clerks Office to effectuate the remand of this case immediately (eps, )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).

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
JASON HESTER,

)
)
Plaintiff,
)
)
vs.
)
)
LEONARD G. HOROWITZ,
)
)
)
Defendant.
_____________________________ )

CIVIL 17-00014 LEK-KSC

ORDER DENYING DEFENDANT’S MOTION TO RECONSIDER AMENDED
ORDER ADOPTING MAGISTRATE JUDGE’S FINDINGS AND RECOMMENDATIONS
On February 17, 2017, this Court issued its Amended
Order Adopting Magistrate Judge’s Findings and Recommendations
(“2/17/17 Order”).1

[Dkt. no. 21.]

On March 3, 2017, pro se

Defendant Leonard G. Horowitz (“Defendant”) filed a motion for
reconsideration of the 2/17/17 Order (“Motion for
Reconsideration”).

[Dkt. no. 23.]

Plaintiff Jason Hester

(“Plaintiff”) filed his memorandum in opposition on March 17,
2017, and Defendant filed his reply on March 29, 2017.
nos. 26, 27.]

[Dkt.

The Court has considered the Motion for

Reconsideration as a non-hearing matter pursuant to Rule LR7.2(e)
of the Local Rules of Practice of the United States District
Court for the District of Hawai`i (“Local Rules”).

After careful

consideration of the motion and the relevant legal authority,
1

The magistrate judge issued his Findings and
Recommendation to Remand Action to State Court (“F&R”) on
January 27, 2017. [Dkt. no. 15.]

Defendant’s Motion for Reconsideration is HEREBY DENIED for the
reasons set forth below.
BACKGROUND
On July 26, 2016, Plaintiff, through his attorney,
Paul J. Sulla, Esq., filed a “Petition to Expunge Documents
Recorded in the Bureau of Conveyances of the State of Hawaii”
(“Petition”) in the State of Hawai`i Circuit Court of the First
Circuit.

[Removal of Case Civ. No. 16-1-1442-07 VLC (“Notice of

Removal”), filed 1/11/17 (dkt. no. 1), Decl. of Leonard G.
Horowitz, Exh. 1 (Petition).]

Pursuant to Haw. Rev. Stat.

§ 507D-1, et seq., Plaintiff seeks to expunge the “Affidavit of
Leonard G. Horowitz (Lis Pendens on Real Property),” filed as
Document Number A-60010681 with the State of Hawai`i Bureau of
Conveyances (“Horowitz Affidavit”).

[Petition at pg. 1, ¶ 6,

Relief Requested ¶ A.]
On January 11, 2017, Defendant removed the case to this
district court.

According to the Notice of Removal, Plaintiff

did not serve the Petition on Defendant until December 21, 2016.2

2

28 U.S.C. § 1446(b)(1) states:
The notice of removal of a civil action or
proceeding shall be filed within 30 days after the
receipt by the defendant, through service or
otherwise, of a copy of the initial pleading
setting forth the claim for relief upon which such
action or proceeding is based, or within 30 days
after the service of summons upon the defendant if
such initial pleading has then been filed in court
(continued...)
2

[Notice of Removal at pg. 2.]

Defendant alleges that Mr. Sulla

is the “concealed real party in interest” in the Petition, and
that the Petition was filed “for anti-competitive advantage in
violation of, inter alia, the Religious Freedom Restoration Act
of 1993, with counterclaims brought pursuant to 42 USC
§ 2000bb(b)(2) against SULLA and State and County of Hawaii
‘joint actors.’”

[Id. (emphasis in original).]

On January 19, 2017, the magistrate judge filed an
entering order (“1/19/17 EO”) that, among other things, ordered
Defendant to identify the legal basis for the removal.
no. 8.]

[Dkt.

On January 20, 2017, Defendant filed his reply to the

1/19/17 EO (“Removal Reply”).

[Dkt. no. 11.]

As noted in the

F&R, Defendant asserts that:
This action is a civil and criminal action of
which this Court has original jurisdiction under
28 U.S.C. § 1331 and 42 U.S.C. § 1988(a), inter
alia, and is one which may be removed to this
Court by Defendant pursuant to the provisions of
28 U.S.C. § 1441(a) in that it arises under [42
U.S.C. §§ 1981, 1983, 1985, 1986, 1962, and
2000bb(b)(2)].
[F&R at 1 (brackets and emphasis in F&R) (footnote omitted)
(quoting Removal Reply at 3-4).]

The magistrate judge, however,

concluded that: “The Petition does not present a federal
question, and federal jurisdiction cannot rest on an actual or

2

(...continued)
and is not required to be served on the defendant,
whichever period is shorter.
3

anticipated defense or counterclaim.”

[Id. at 4 (citing Vaden v.

Discover Bank, 556 U.S. 49, 60 (2009) (“Federal jurisdiction
cannot be predicated on an actual or anticipated defense
. . [n]or can federal jurisdiction rest upon an actual or
anticipated counterclaim.”)).]

The magistrate judge therefore

recommended that the case be remanded to the state court.
On February 10, 2017, Defendant filed a document that
this Court construed as his objections to the F&R (“Objections”).
[Dkt. no. 18.]

This Court denied Defendant’s Objections and

adopted the F&R in the 2/17/17 Order.
In the instant Motion for Reconsideration, Defendant
argues that this Court should reconsider the 2/17/17 Order and
reject the F&R because: the state courts do not have exclusive
jurisdiction over Haw. Rev. Stat. Chapter 507D actions; the
existence of diversity jurisdiction is apparent from the face of
the Petition; expunging the Horowitz Affidavit would deprive him
of his right to “free speech, free press, and freedom to petition
the government for redress of grievances”; because the property
at issue in the Petition is a religious property, issues
regarding the First Amendment of the United States Constitution
are apparent from the Petition; and federal question jurisdiction
exists pursuant to 28 U.S.C. § 1441(f).

4

DISCUSSION
This Court has previously stated that a motion for
reconsideration
“must accomplish two goals. First, a motion for
reconsideration must demonstrate reasons why the
court should reconsider its prior decision.
Second, a motion for reconsideration must set
forth facts or law of a strongly convincing nature
to induce the court to reverse its prior
decision.” See Davis v. Abercrombie, Civil
No. 11-00144 LEK-BMK, 2014 WL 2468348, at *2 (D.
Hawaii June 2, 2014) (citation and internal
quotation marks omitted). This district court
recognizes three circumstances where it is proper
to grant reconsideration of an order: “(1) when
there has been an intervening change of
controlling law; (2) new evidence has come to
light; or (3) when necessary to correct a clear
error or prevent manifest injustice.” Tierney v.
Alo, Civ. No. 12-00059 SOM/KSC, 2013 WL 1858585,
at *1 (D. Hawaii May 1, 2013) (citing School
District No. 1J v. ACandS, Inc., 5 F.3d 1255, 1262
(9th Cir. 1993)). “Mere disagreement with a
previous order is an insufficient basis for
reconsideration.” Davis, 2014 WL 2468348, at *3
n.4 (citations and internal quotation marks
omitted).
Riley v. Nat’l Ass’n of Marine Surveyors, Inc., Civil No. 1400135 LEK-RLP, 2014 WL 4794003, at *1 (D. Hawai`i Sept. 25,
2014).

Further, “reconsideration may not be based on evidence

and legal arguments that a movant could have presented at the
time of the challenged decision.”

Wereb v. Maui Cty., 830 F.

Supp. 2d 1026, 1031 (D. Hawai`i 2011) (some citations omitted)
(citing Kona Enter., Inc. v. Estate of Bishop, 229 F.3d 877, 890
(9th Cir. 2000)).

5

I.

Diversity Jurisdiction
As Defendant points out in the Motion for

Reconsideration, “[n]othing in Chapter 507D confers exclusive
jurisdiction on the state circuit court and precludes a federal
court sitting in diversity from hearing this case, and in any
event, ‘state law may not control or limit the diversity
jurisdiction of the federal courts.’”

Olson v. Lui, Civ. No. 10-

00691 ACK-RLP, 2012 WL 39293, at *2 n.1 (D. Hawai`i Jan. 6, 2012)
(quoting Begay v. Kerr–McGee Corp., 682 F.2d 1311, 1315 (9th Cir.
1982)).

Defendant argues that “[r]emoval is appropriate under 28

U.S.C. § 1441(b) on the basis of diversity where none of
defendants is a citizen of the state in which the action is
brought,” and Defendant asserts that he was entitled to remove
the case based on diversity jurisdiction because “Plaintiff has
not established Defendant is a citizen of a state other than
California.”

[Mem. in Supp. of Motion for Reconsideration at 7-8

n.4.]
Thus, Defendant alleges that this Court has diversity
jurisdiction over Petition, which was brought pursuant to
Chapter 507D.

Defendant, however, failed to raise this argument

in his Objections to the F&R.

This Court cannot grant

reconsideration of the 2/17/17 Order based on an argument that
Defendant could have raised in the Objections.
Supp. 2d at 1031.

6

See Wereb, 830 F.

More importantly, Defendant did not assert diversity
jurisdiction in either his Notice of Removal or his Removal
Reply.

The full title of the Removal Reply is “Reply to Court

Order of 1/19/17 Pursuant to Basis for Removal and Statutory
Provision under § 1441(a) Federal Questions.”
1 (emphasis added).]

[Removal Reply at

Further, the Removal Reply expressly

asserts that this Court has “original jurisdiction under
28 U.S.C. § 1331,” and it lists various federal laws Defendant
contends the action “arises under.”

[Id. at 3-4.]

Section 1331

governs federal question jurisdiction and states: “The district
courts shall have original jurisdiction of all civil actions
arising under the Constitution, laws, or treaties of the United
States.”

28 U.S.C. § 1332 governs diversity jurisdiction.
Defendant’s Motion for Reconsideration essentially

seeks to amend his Notice of Removal to add diversity
jurisdiction as a basis for removal.

This district court has

stated:
Ordinarily, “the notice of removal required by
[28 U.S.C. §] 1446(b) may be amended freely by the
defendant prior to the expiration of the
thirty–day period for seeking removal.” 14C
Charles Alan Wright, Arthur R. Miller, Edward H.
Cooper, Pocket Part by The Late Charles Alan
Wright, Arthur R. Miller, Edward H. Cooper,
Joan E. Steinman, Federal Practice and Procedure
§ 3733. After the 30–day period for seeking
removal has passed, however, “the notice may be
amended only to set out more specifically the
grounds for removal that already have been stated,
albeit imperfectly, in the original notice.” Id.;
7

ARCO Envtl. Remediation, L.L.C. v. Dep’t of Health
& Envtl. Quality of Montana, 213 F.3d 1108, 1117
(9th Cir. 2000) (“[A] defendant may amend the
Notice of Removal after the thirty day window has
closed to correct a defective allegation of
jurisdiction.”); Barrow [Dev. Co. v. Fulton Ins.
Co.], 418 F.2d [316,] 317 [(9th Cir. 1969)] (after
thirty-day period lapses, the defendant may not
amend a notice of removal “to add allegations of
substance but solely to clarify ‘defective’
allegations of jurisdiction previously made”).
Pioneer Asset Inv. Ltd. v. Arlie & Co., CIVIL NO. 15-00387 ACKKSC, 2015 WL 9665667, at *4 (D. Hawai`i Dec. 14, 2015) (emphasis
added), report and recommendation adopted, 2016 WL 70445 (Jan. 5,
2016).

Because the thirty-day period for Defendant to remove the

Petition has already passed, Defendant can only amend his Notice
of Removal to clarify the grounds for removal that he alleged –
or at least attempted to allege – in the Notice of Removal.
This Court must liberally construe Defendant’s filings
because he is proceeding pro se.

See, e.g., Pregana v.

CitiMortgage, Inc., Civil No. 14-00226 DKW-KSC, 2015 WL 1966671,
at *2 (D. Hawai`i Apr. 30, 2015) (“The Court liberally construes
the [plaintiffs’] filings because they are proceeding pro se.”
(citing Eldridge v. Block, 832 F.2d 1132, 1137 (9th Cir. 1987))).
Even liberally construing Defendant’s Notice of Removal, it did
not contain any attempt to allege diversity jurisdiction as a
basis for removal.

Therefore, since the thirty-day removal

period has passed, Defendant cannot amend his Notice of Removal
to add diversity jurisdiction as a new basis for removal.

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This

Court therefore DENIES Defendant’s Motion for Reconsideration as
to his argument that this Court has diversity jurisdiction over
the Petition.
II.

Federal Question Jurisdiction
Defendant argues that this Court must “‘look through’”

the Petition “to determine if the court would have jurisdiction
over ‘the [substantive] controversy between the parties.’”

[Mem.

in Supp. of Motion for Reconsideration at 4-5 (quoting Vaden, 129
S. Ct. at 1268).]

He argues that, if this Court does so, the

federal questions that he has identified are apparent.

Defendant

also alleges that, even without the “look through” analysis, the
federal questions are apparent on the face of the Petition.
argues:
On its face, the Complaint seeks to expunge
Defendant’s free speech, free press, freedom to
petition the government for redress of grievances,
as well as preclude the Defendant’s exercise of
his public duty to warn citizens not to get mixed
upon [sic] in the alleged crimes. Moreover, the
Property, being a religious property, raises
additional federal questions. Accordingly,
multiple First Amendment and religious freedom
questions are facially evident in the Complaint.
The consummate federal question raised on the
face of the Complaint and its Exhibits “A” thru
“C” is how Sulla could have succeeded in
substantially burdening the civil rights,
religious property rights, and religious freedom
of the Defendant with the aid of State agents,
depriving Horowitz of his free use and enjoyment
of the Property more than a decade. The
Complaint, on its face therefore, raises First and
Fourteenth Amendment questions pursuant to 42 U.S.

9

He

Code § 2000bb-l(a), 42 U.S.C. §§ 1981, 1982, 1983,
1985, 1986, and 1962.
[Id. at 23-24 (footnote omitted).]
To the extent that Defendant argues that federal
questions are apparent from the Petition itself, these are the
same arguments that the magistrate judge considered and rejected
in the F&R.

The magistrate judge concluded that the Petition did

not raise a federal question and that the federal issues
Defendant identified arose from actual or anticipated defenses
and counterclaims, which could not support removal jurisdiction.
This Court adopted the magistrate judge’s analysis and denied
Defendant’s Objections in the 2/17/17 Order.

Defendant merely

disagrees with the magistrate judge’s and this Court’s analysis,
and Defendant’s disagreement is not a basis for reconsideration.
See Davis, 2014 WL 2468348, at *3 n.4.
In addition, Defendant’s argument regarding “look[ing]
through” the Petition is misplaced.

Vaden did not abrogate the

“the longstanding well-pleaded complaint rule.”3

556 U.S. at 60.

3

The United States Supreme Court described the well-pleaded
complaint rule as follows:
[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].”
Louisville & Nashville R. Co. v. Mottley, 211 U.S.
149, 152, 29 S. Ct. 42, 53 L. Ed. 126 (1908).
Federal jurisdiction cannot be predicated on an
actual or anticipated defense: “It is not enough
that the plaintiff alleges some anticipated
(continued...)
10

Vaden merely stated that the United States Supreme Court
approve[d] the “look through” approach to this
extent: A federal court may “look through” a
[Federal Arbitration Act, 9 U.S.C.] § 4 petition
[to compel arbitration] to determine whether it is
predicated on an action that “arises under”
federal law; in keeping with the well-pleaded
complaint rule as amplified in Holmes Group[, Inc.
v. Vornado Air Circulation Systems, Inc., 535 U.S.
826 (2002),4] however, a federal court may not
entertain a § 4 petition based on the contents,
actual or hypothetical, of a counterclaim.
556 U.S. at 62.

The “‘look through’ approach” discussed in Vaden

therefore does not apply under the facts of this case and does
not support Defendant’s position that this Court should
reconsider the 2/17/17 Order.
Defendant also argues that federal question
jurisdiction exists based upon 28 U.S.C. § 1441(f), which states:
“The court to which a civil action is removed under this section
is not precluded from hearing and determining any claim in such
civil action because the State court from which such civil action
is removed did not have jurisdiction over that claim.”

Section

1441(f) merely stands for the proposition that “the fact that the

3

(...continued)
defense to his cause of action and asserts that
the defense is invalidated by some provision of
[federal law].” Ibid.

Vaden, 556 U.S. at 60 (some alterations in Vaden).
4

In Holmes Group, the Supreme Court “emphatically” held
that an actual or anticipated counterclaim, even when compulsory,
does not establish federal question jurisdiction. Vaden, 556
U.S. at 60 (discussing Holmes Group).
11

state court lacked jurisdiction does not defeat removal
jurisdiction.”

In re Miles, 430 F.3d 1083, 1095 n.1 (9th Cir.

2005) (Berzon, J., concurring).

Thus, § 1441(f) is not an

independent source of federal question jurisdiction, and this
Court rejects Defendant’s argument that it has jurisdiction over
the instant case based on § 1441(f).
This Court DENIES Defendant’s Motion for
Reconsideration as to his arguments asserting that this Court has
federal question jurisdiction over the instant case.
III. Remaining Arguments and Summary
The remainder of the arguments that Defendant raises in
the Motion for Reconsideration address the merits of the
Petition, not the existence of federal jurisdiction.

This Court

does not need to address those arguments, and this Court
emphasizes that it has not made any findings or conclusions
regarding the merits of the Petition.
Having carefully considered all of the arguments that
are properly before it, this Court CONCLUDES that the Motion for
Reconsideration fails to present any ground that warrants
reconsideration of the 2/17/17 Order.
CONCLUSION
On the basis of the foregoing, Defendant’s Motion to
Reconsider Amended Order Adopting Magistrate Judge’s Findings and
Recommendations, filed March 3, 2017, is HEREBY DENIED.
12

This

Court DIRECTS the Clerk’s Office to effectuate the remand of this
case immediately.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAII, April 28, 2017.

/s/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge

JASON HESTER VS. LEONARD G. HOROWITZ; CIVIL 17-00014 LEK-KSC;
ORDER DENYING DEFENDANT’S MOTION TO RECONSIDER AMENDED ORDER
ADOPTING MAGISTRATE JUDGE’S FINDINGS AND RECOMMENDATIONS

13