Rosenberg et al v. Webber

Filing 32

MEMORANDUM OPINION. Signed by Judge Richard D. Bennett on 6/3/2016. (jnls, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
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DIANE S. ROSENBERG, et al.,
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Plaintiffs,

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Civil Action No.: RDB-15-3014

v.
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PAULA WEBBER,

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Defendant.
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MEMORANDUM OPINION
This action arises out of a foreclosure dispute between Plaintiffs Diane S. Rosenberg,
et al. (“Plaintiffs”) and pro se Defendant Paula Webber (“Defendant” or “Webber”). In July
2013, the Plaintiffs, ”)1, acting as substitute trustees for Wells Fargo Bank, N.A. (“Wells
Fargo”), initiated an action2 in the Circuit Court for Anne Arundel County, Maryland to
foreclose on the residential property at 1552 Penzance Way, Hanover, Maryland 21076 (the
“Property”). See Compl., ECF No. 2. Defendant Webber, the alleged owner of the Property,
attempted to stop the foreclosure by filing a Third-Party Complaint (ECF No. 3) in the same
court, alleging, inter alia, wrongful foreclosure, quiet title, and seeking related injunctive relief.
The Circuit Court for Anne Arundel County ultimately dismissed Webber’s claims with
prejudice on February 25, 2014. See Order, Brown v. Webber, Case No. 02-C-13-180217.
1 Plaintiffs are: Diane S. Rosenberg, Mark D. Meyer, John A. Ansell, III, Kenneth Savitz, Stephanie
Montgomery, Kristine D. Brown, William M. Savage, Gregory N. Britto, Lila Z. Stitley, R. Kip Stone, Jordy
B. Hirschfield. Although the caption of this case does not include Kristine Brown, William Savage, Gregory
Britto, Lila Stitle, Kip Stone, or Jordy Hirschfield as Plaintiffs, these individuals are also named substitute
trustees and plaintiffs in the foreclosure action that is the subject of the pending Motion to Remand. As such,
the Clerk of the Court is directed to re-caption this case to reflect the additional named Plaintiffs.
2 Kristine D. Brown v. Paula L. Webber, Case No. 02-C-13-180217 (Circuit Ct. for Anne Arundel Cnty., Md.).

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On June 23, 2015, the Property was sold to Art Homes, LLC for the sum of
$233,500.00. Notice of Sale, ECF No. 22. Webber subsequently removed the action to this
Court on October 6, 2015 pursuant to 28 U.S.C. §§ 1332, 1441, and 1446.3 Notice of
Removal, ECF No. 1. Currently pending is Plaintiff William Savage’s Motion to Remand
(ECF No. 27). The parties’ submissions have been reviewed and no hearing is necessary. See
Local Rule 105.6 (D. Md. 2014). For the following reasons, Plaintiff William Savage’s
Motion to Remand (ECF No. 27) is GRANTED. In sum, Defendant’s attempt at removal
suffers from several fatal flaws, both procedural and substantive. This action is accordingly
REMANDED to the Circuit Court for Anne Arundel County, Maryland.
BACKGROUND
In July 2013, Plaintiffs, acting as substitute trustees for Wells Fargo, initiated a
foreclosure action in the Circuit Court for Anne Arundel County, Maryland on Defendant
Webber’s residence at 1552 Penzance Way, Hanover, Maryland 21076 (the “Property”). See
generally Compl., ECF No. 2. Webber, proceeding pro se, then filed a Third-Party Complaint
in an effort to halt the foreclosure. See generally Crossclaim (Third-Party Compl.), ECF No. 3.
Webber alleges that she was issued a promissory note securing her home mortgage to World
Savings Bank in 2005. Id. ¶ 10. World Savings Bank was successively acquired by Wachovia
Bank, and then Wells Fargo. Id. ¶¶ 11-12. Webber claims that her debt was discharged in
June 2012 when she allegedly wired electronic funds to Wells Fargo in satisfaction of that
debt. Id. ¶¶ 15-16. The funds were allegedly received, however they were subsequently
Upon the removal of this case to this Court, the Circuit Court for Anne Arundel County stayed the state
action. As such, while the Property was sold on June 23, 2015, removal occurred before the state court issued
an order ratifying the sale. See generally Brown v. Webber, Case No. 02-C-13-180217. Accordingly, the resolution
of the state action awaits a ruling of this Court.

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returned defaced. Id. Webber alleges that the mere receipt and return of the funds was
sufficient to satisfy and discharge the debt, thus she allegedly recorded a new deed for the
Property on August 16, 2012. Id. ¶¶ 16, 19.
On December 3, 2012, Plaintiffs allegedly sent a letter to Wells Fargo, claiming an
outstanding debt on Webber’s property. Id. ¶ 20. Acting as substitute trustees for Wells
Fargo, Plaintiffs then recorded a notice of foreclosure for the Property. Webber claims that
she was not properly served the Notice of Foreclosure, as the documents were allegedly
placed on her front step and not in her hands. Id. ¶ 23. In her Third-Party Complaint, she
argues that Plaintiffs do not have an interest in the Property, have no right to foreclose, and
failed to comply with the requisite foreclosure procedures. See generally id.
The Circuit Court for Anne Arundel County subsequently dismissed Webber’s ThirdParty Complaint with prejudice. See Order, Brown v. Webber, Case No. 02-C-13-180217. The
Property was then sold to Art Homes, LLC on June 23, 2015. Notice of Sale, ECF No. 22.
On October 6, 2015, Webber filed the present Notice of Removal (ECF No. 1) to remove
the foreclosure action to this Court pursuant 28 U.S.C. §§ 1332, 1441, and 1446. In addition
to the claims asserted (and rejected) in her Third-Party Complaint, Webber seeks to
challenge the constitutionality of the Maryland foreclosure process through 42 U.S.C. § 1983.
ANALYSIS
A defendant in a state civil action may remove the case to federal court only if the
federal court can exercise original jurisdiction over at least one of the asserted claims. 28
U.S.C. § 1441(a)-(c).

Federal courts have original jurisdiction over two kinds of civil

actions—those which are founded on a claim or right arising under the Constitution, treaties
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or laws of the United States, and those where the matter in controversy exceeds $75,000 and
is between citizens of different States. U.S. Const. art. III, § 2; 28 U.S.C. §§ 1331, 1332(a)
(2006). If a civil action is not based on a question of federal law, then a federal court may
only exercise original jurisdiction based on diversity of citizenship. The purpose of the
diversity requirement “is to provide a federal forum for important disputes where state
courts might favor, or be perceived as favoring, home-state litigants. The presence of parties
from the same State on both sides of a case dispels this concern, eliminating a principal
reason for conferring § 1332 jurisdiction over any of the claims in the action.” Exxon Mobil
Corp. v. Allapattah Servs., 545 U.S. 546, 553-54 (2005). As the Supreme Court has noted,
“[i]ncomplete diversity destroys original jurisdiction with respect to all claims.” Id. at 554.
Once an action is removed to federal court, the plaintiff may file a motion to remand
the case to state court if jurisdiction is defective. 28 U.S.C. § 1447(c). The party seeking
removal, and not the party seeking remand, bears the burden of establishing jurisdiction in
the federal court. Mulcahey v. Columbia Organic Chemicals Co., Inc., 29 F.3d 148, 151 (4th Cir.
1994) (citing Wilson v. Republic Iron & Steel Co., 257 U.S. 92 (1921)). Federal courts are obliged
to carefully scrutinize challenges to jurisdictional authority, and must “do more than simply
point jurisdictional traffic in the direction of state courts.” 17th Street Associates, LLP v.
Markel Int’l Ins. Co. Ltd., 373 F. Supp. 2d 584, 592 (E.D. Va. 2005). The federal remand
statute provides that “[a]n order remanding a case to the State court from which it was
removed is not reviewable on appeal or otherwise . . .” 28 U.S.C. § 1447(d). On a motion to
remand, a court must “strictly construe the removal statute and resolve all doubts in favor of
remanding the case to state court.” Richardson v. Phillip Morris, Inc., 950 F. Supp. 700, 701-02
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(D.Md.1997) (citation omitted). “If federal jurisdiction is doubtful, a remand is necessary.”
Mulcahy, 29 F.3d at 151; see also Dixon v. Coburg Dairy, Inc., 369 F.3d 811, 815-16 (4th Cir.
2004).
Webber ostensibly removed this action on the basis of diversity jurisdiction, 28
U.S.C. § 1332. See Notice of Removal at 3. Yet, regardless of the ground upon which
removal is based, Webber’s attempt is untimely. In general, a defendant must file the notice
of removal of the civil action either
within 30 days after the receipt by the defendant, through
service or otherwise, of a copy of the initial pleading . . ., or
within 30 days after the service of summons upon the
defendant if such initial pleading has been filed in court and is
not required to be served on the defendant, whichever period is
shorter.
28 U.S.C. § 1446(b)(1). As the United States Court of Appeals has clearly explained,
“untimely removal is a defect in removal procedure.” Cades v. H&R Block, Inc., 43 F.3d 869,
873 (4th Cir. 1994). That defect “renders a case improperly removed.” Link Telecomms., Inc. v.
Sapperstein, 119 F. Supp. 2d 536, 542 (D. Md. 2000) (citing Huffman v. Saul Holdings Ltd. P’ship,
194 F.3d 1072, 1076 (10th Cir. 1999).
Removal premised on diversity jurisdiction adds an additional burden, whereby the
removing party must seek removal within one year of the filing of the state court action. 28
U.S.C. § 1446(c)(1). This requirement is excused only when “the district court finds that the
plaintiff has acted in bad faith in order to prevent a defendant from removing the action.” Id.
A removing party’s failure to comply is “an absolute bar to removal of cases in which
jurisdiction is premised on 28 U.S.C. § 1332[.]” Lovern v. General Motors Corp., 121 F.3d 160,
163 (4th Cir. 1997).
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In this case, Plaintiffs filed the foreclosure action in July 2013. Although Savage does
not provide the date upon which Webber was served a copy of the Complaint, this Court
may assume that she was served shortly thereafter because she filed her own Third-Party
Complaint in August 2013. Over two years later, she filed the subject Notice of Removal in
this Court. Her attempt at removal is thus untimely under the 30-day general filing
requirement and the one-year deadline applied to diversity jurisdiction cases. This
untimeliness is a fatal defect that, on its own, necessitates remand of this action.
Even if Webber had timely removed the action to this Court, her efforts suffer from
two substantive flaws that, again, oblige this Court to remand the action to state court. First,
this Court notes that Webber explicitly invokes only 28 U.S.C. § 1332—diversity
jurisdiction—and not 28 U.S.C. § 1331—federal question jurisdiction—in her Notice of
Removal. Regardless, she attempts to avoid remand by arguing that this Court has
jurisdiction due to the presence of questions of federal law. This action, however, is simply a
foreclosure action, firmly premised on state law. See Compl. The sole questions of federal
law are Webber’s arguments against foreclosure, such as her belief that Maryland’s
foreclosure scheme violates the United States Constitution. See Notice of Removal at 3-5.
Yet, it is firmly established that “[a] federally-based counterclaim by an original defendant is
not eligible to serve as the basis for removal on federal question grounds.” Wittstadt v. Reyes,
113 F. Supp. 3d 804, 806 (D. Md. 2015); accord Cohn v. Charles, 857 F. Supp. 2d 544, 548 (D.
Md. 2012); Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987). Webber, the original
defendant in the foreclosure action, may continue to assert federal counterclaims and

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defenses against the foreclosure, but those arguments may not serve as the basis for federal
question jurisdiction.
Second, even if Webber had established subject-matter jurisdiction, this Court must
abstain from adjudication under Younger v. Harris, 401 U.S. 37 (1971), and its progeny. As the
Fourth Circuit has explained, Younger abstention “requires a federal court to abstain from
interfering in state proceedings, even if jurisdiction exists,” when there is “(1) an ongoing
state judicial proceeding, instituted prior to any substantial progress in the federal
proceeding; that (2) implicates important, substantial, or vital state interests; and (3) provides
an adequate opportunity for the [party] to raise the federal constitutional claim advanced in
the federal lawsuit.” Laurel Sand & Gravel, Inc. v. Wilson, 519 F.3d 156, 165 (4th Cir. 2008).
The Younger doctrine does not espouse “merely a principle of abstention rather [it] sets forth
a mandatory rule of equitable restraint, requiring the dismissal of a federal action.” Williams v.
Lubin, 516 F. Supp. 2d 535, 539 (D. Md. 2007) (quoting Nivens v. Gilchrest, 444 F.3d 237, 247
(4th Cir. 2006)).
In this case, all three elements of Younger abstention are satisfied. First, an ongoing
state judicial proceeding—the foreclosure action—was instituted prior to Webber’s attempt
at removal to federal court. Second, this Court has previously held that Maryland has a
substantial interest in all aspects of its property law, including the foreclosure process.
Barilone v. Onewest Bank, FSB, Civ. A. No. ELH-13-00752, 2013 WL 6909423, at *5 (D. Md.
Dec. 31, 2013) (citing Harper v. Pub. Serv. Comm’n of W. Va., 396 F.3d 348, 352 (4th Cir. 2005)
(“[P]roperty law concerns, such as land use and zoning questions, are frequently ‘important’
state interests justifying Younger abstention.”); Fisher v. Fed. Nat’l Mortg. Ass’n, 360 F. Supp.
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207, 210 (D. Md. 1973)). Third, Webber offers no reasons why the state court could not
consider her constitutional arguments. To the extent that she challenges the constitutionality
of Maryland’s foreclosure process, she has had ample opportunity to assert such arguments
before the Circuit Court for Anne Arundel County.
Finally, no exception to the Younger doctrine applies to counsel against abstention. In
Younger, the United States Supreme Court identified two situations in which abstention is
inappropriate: (1) when plaintiffs show that the state official is bringing the state action in
bad faith or to harass, Younger, 401 U.S. at 47-49; or (2) there is “great and immediate”
irreparable injury if the state law at issue “flagrantly and patently” violates the Constitution,
id. at 53-54. Webber has made no showing that the foreclosure process was conducted in
bad faith. Although she argues that Maryland’s foreclosure laws violate the Constitution, the
offending laws must be “flagrantly and patently violative of express constitutional
prohibitions in every clause, sentence, and paragraph, and in whatever manner and against
whomever an effort might be made to apply it.” Id. (quoting Watson v. Buck, 313 U.S. 387,
402 (1941)). Webber’s vague and conclusory constitutional arguments do not even approach
this high burden.
In sum, Webber’s attempt to remove the foreclosure action suffers from several
procedural and substantive flaws. Even if she had satisfactorily complied with the procedural
requirements of removal, this Court must abstain from adjudication pursuant to Younger v.
Harris. Accordingly, this action must be remanded to state court.
CONCLUSION

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For the reasons stated above, Plaintiff William Savage’s Motion to Remand (ECF No.
27) is GRANTED. In sum, Defendant’s attempt at removal suffers from several fatal flaws,
both procedural and substantive. This action is accordingly REMANDED to the Circuit
Court for Anne Arundel County, Maryland.
A separate Order follows.

Dated:

June 3rd, 2016

_______/s/_______________________
Richard D. Bennett
United States District Judge

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