Johnson v. Xerox Educational Solutions, LLC et al
Filing
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MEMORANDUM OPINION. Signed by Judge George Jarrod Hazel on 10/20/14. (c/m 10/20/14 jf2s, Deputy Clerk) Modified on 10/20/2014 (jf2s, Deputy Clerk).
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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
So/lt1lem Divisio/l
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JOSEPH JOHNSON,
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.JR.
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Plaintiff,
v.
Case No.: G.JH-14-CV-1542
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XEROX EDUCATIONAL
LLC, et al.
SOLUTIONS
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Defendants.
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MEMORANDUM
This Memorandum
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OPINION
Opinion addresses Plaintiff s Motion to Remand. ECF No. 1I,
Defendants' Opposition and Cross Motion for Leave to File Amended Notice of Removal, ECF
No. 18, and Plaintiffs
Rule 105.6.
Reply, ECF No. 20. The Court finds a hearing is unnecessary. See Local
For the reasons articulated below, Plaintiffs
motion is DENIED. Defendants'
Motion to Amend their Notice of Removal is GRANTED.
1.
BACKGROUND
Plaintiff Joseph Johnson, Jr. filed this lawsuit on February 11,2014 in the District Court
for Prince George's County, Maryland against Defendants Xerox Education Solutions. LLC,
Xerox Business Services, LLC, and Xerox Corporation. ECF No. I at ~ I. Alier Defendants
demanded a jury trial, on March 7, 2014, the case was removed to the Circuit Court for Prince
George's County, Maryland. Jd. at
On April 11,2014,
from six to twelve. Id. at
'Ii 3.
Plaintitf tiled an amended complaint, doubling the causes of action
'Ii 4.
Defendants tiled a motion to dismiss Plaintiffs original complaint
on April 14, 2014. ECF No. 21-2. Apparently belatedly realizing Plaintiff had Iiled an amended
complaint, on May 9, 2013, Defendants filed a notice of removal to this Court based on federal
diversity jurisdiction. ECF No. I. Plaintiff has filed the instant motion to remand. ECF No. II.
II.
DISCUSSION
Pursuant to 28 U.S.C.
S
1332(a), federal district courts "have original jurisdiction of all
civil actions where the matter in controversy exceeds the sum or value of $75.000. exclusive of
interest and costs, and is between-(I)
citizens of different States ... :. When a plaintiff files
such an action in state court, the action "may be removcd by the defendant or the defendants, to
the district court of the United States for the district and division cmbracing the place where such
action is pending:' 28 U.S.c.
S
1441(a). Removal is proper over any action that a plaintiff could
have filed in federal court. See ill.
Plaintiff challenges Defendants' removal on various grounds. He argues that this Court
lacks jurisdiction
because Defendants did not properly allege diversity, the parties are not
diverse, and thc amount in controvcrsy does not excced $75.000. ECF No. II at 7-14. Plaintiff
also contcnds that Dcfcndants waived their right to remove the action to federal court by filing a
motion to dismiss in state court. [n addition. Plaintiff complains that Defendants did not attach
all necessary documents to the notice of removal. Id. at 4-7. Plaintiff requests compensation for
his time in preparing the motion for remand. Id. at 15-17.
I.
Diversity
Plaintiff argues that Defendants were required but failed to allegc that Plaintiff was a
citizen of Maryland at the commencement of his lawsuit. ECF No. II at 8. Plaintiff also denies
that he is a citizen of Maryland. Id. Defendants request that the Court permit them to amend their
Notice of Removal to assert that Plaintiff was a citizen of Maryland at the commencement of his
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lawsuit, and Defendants assert that they have sufficiently shown Plaintiffs citizenship. ECF No.
18 at 4-5.
a.
28 U.S.c.
Leave to Amend
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1332 governs federal jurisdiction based on diversity of citizenship. Where
the basis of removal is diversity, diversity of citizenship must exist at the time the action was
filed in state court and at the time of removal. Kessler v. Home Life Ins. Co.. 965 F.Supp 11. 12
(D. Md. 1997). Here, Defendants alleged in their Notice of Removal that Plaintiff is a citizen of
Maryland, ECF No. I at ~ 6, however, Defendants did not state that Plaintiff was a citizen of
Maryland at the time the action was tiled. Defendants request leave to amend their notice to
includes the allegation that Plaintiff was a citizen of Maryland at the commencement
of his
lawsuit. ECF No. 18 at 4-5.
Federal courts typically allow amendments to removal petitions to cure a technical defect
but not to add a missing jurisdictional allegation. lviolnar-Szilasi \'. Sears Roebuck & Co,. 429 F.
Supp. 2d 728. 730 (D. Md. 2006). For example, on the one hand. courts have found that stating
the residences of the parties instead of the domiciles or incorrectly stating a principle place of
business are technical defects that can be corrected. id. (ciling Muhlenbeck
1'.
KI. LLC. 304 F.
Supp. 2d 797, 800 (E.D. Va. 2004)). On the other hand, courts have decided that failure to allege
fraudulent joinder or failure to allege a particular basis for removal are mistakes that cannot be
corrected. Id. (citing Iceland Sea/bod Corp.
1'.
Nat. Consumer Cooperative Bank, 285 F.Supp. 2d
719, 726-27 (E.D. Va. 2003) (basis for removal), and Tincher
667 (E.D. Va. 2003) (fraudulent joinder)).
3
1'.
Ins, Co" 268 F.Supp. 2d 666,
Here, given Defendants' allegation that Plaintiff is a citizen of Maryland, their failure to
allege that Plaintiff was a citizen of Maryland when he filed his complaint is a technical defect.
Thus, the Court grants Defendants' motion to amend the notice of removal.
b,
Citizenship
Defendants assert that Plaintiff is a citizen of Maryland because Plaintiff previously
established, before another federal district court, that he was a Maryland citizen. ECF No. 18 at
3-5. Further, Defendants also cite that Plaintiff is a current Maryland resident. Jd. at 3. Plaintiff
responds by stating that he is not a Maryland citizen. ECF No. 11 at 8.
The party seeking to invoke the jurisdiction of the federal court, in this case Defendants.
has the burden of showing jurisdiction is proper. See Sligh
1'.
Doe. 596 F.2d 1169. 1170 (4th Cir.
1979). "For purposes of [fjederal divcrsity jurisdiction, a party is a citizen of the State of which
he is domiciled." Deese \'. Hundley, 232 F.Supp. 848, 849 (W.D. S.c. 1964), (ciling Wil/iamson
\'. Osenten, 232 U.S. 619, 624 (1914)). A domicilc is created by" ... physical presence in a place
in connection with a certain state of mind concerning one's intent to remain there." Mississippi
Band of ChoClall' Indians
1'.
Holyfield, 490 U.S. 30, 48 (1989). Courts presume that once an
individual has established a domicile, he remains a citizen there until he satisfies the mental and
physical requirements of domicile in a new state. Dyer \'. Robinson, 853 F. Supp. 169, 172-73
(D. Md. 1994); AIcDougald \'. Jenson. 786 F.2d 1465, 1483 (11th Cir.1986). Thus, a party's
previous domicile is presumed to continue unless and until it appears that the party was
physically present in another state and he intended to remain in that state indefinitely. 0 'Brien
1'.
Jansen, 903 F.Supp. 903. 904 (D. Md. 1995). Moreover, an individual's residence at the time a
lawsuit is commenced provides prima facie evidence of his domicile. See Dislricl of Collllnbia
1'.
Murphy. 314 U.S. 441, 455 (1941) ("The place where a man lives is properly taken to be his
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domicile until facts adduced establish to the contrary."'); Granile Trading C0I1). v. Harris, 80
F.2d 174, 176 (4th Cir. 1935); KrasnoVl". Dinan. 465 F.2d 1298, 1300 (3d Cir. 1972).
In 2012, Plaintiff established that he was domiciled in Maryland before the United States
Court of Appeals for the Fifth Circuit. Johnson v. Affiliated Compuler Sen's .. Inc., 500 Fed.
Appx. 265, 265-66 (5th Cir. 2012) (noting Plaintiffs
address as Fort Washington, MD and
stating that "[w]ith respect to diversity of citizenship, the supplemental materials provided by
Defendant ACS Education Solutions, LLC demonstrate that at all times its members were
completely
diverse from Johnson"'); see also ECF No. 18-4 at ~ 4, Plaintiffs
Amended
Complaint in Johnson v. Afjiliated Complller Servs .. Inc., Civil Action No: 3: IO-CV-2333 ("The
Plaintiff was a citizen of and resident in Fort Washington, Maryland ... "').
The Court takes judicial notice of the facts presented in Plaintiffs
prior litigation In
another jurisdiction. See Colonial Penn Ins. Co \'. Coil, 887 F.2d 1236. 1239 (4th Cir. 1989)
("[t]he most frequent use of judicial notice of ascertainable facts is in noticing the content of
court records."') (citation and internal quotation marks omitted). Thus, Plaintiff has previously
established a domicile in Maryland, and he is presumed to remain a citizen in Maryland. See
Dyer v. Robinson, 853 F. Supp. 169. 173 (D. Md. 1994). Plaintiff has not put forth any evidence
to rebut this presumption.
Indeed, Plaintiff notes that he still resides in Fort Washington,
Maryland, ECr NO.4 at ,; 2, which is a fact that also favors a finding that Plaintiff continues to
be a citizen of Maryland. Plaintiffs
blanket denial of Maryland citizenship in his brief to the
Court, which is not evidence, is insufficient to rebut the presumption of continued Maryland
citizenship.
With the unrebutted presumption that Plaintiff is a current citizen of Maryland,
Defendants
have met their burden of showing that all Defendants, citizens of Texas and
Connecticut, are diverse from Plaintilf, a citizen of Maryland.
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2.
Amount in Controversy
Plaintiff disputes that the amount in controversy is over $75,000. Plaintiff alleges twelve
theories ofrecovcry,
several requesting at least $50,000 in damages and attorney's fees. ECF No.
4. Plaintiff attempts to minimize these amounts by stating that he is not entitled to attorney's fees
because he is representing himself and by stating that he is only seeking one set of $50,000
damages based on separate theories of recovery. ECF No. 11 at 11-12. Plaintiff also asserts that
Defendants, being the removing parties, are required to demonstrate to a legal certainty that
Plaintiff's claims exceed $75,000. It!. at II. Defendants assert that Plaintiff's damage requests
exceed $75,000 because at least some of his counts are separate harms and not simply differing
theories for the same harm. ECF No. 18 at 5-6.
Courts generally determine the amount In controversy by reference to the plaintiffs
complaint. See Wiggins v. North Amer. Equitable Life Assur. Co., 644 F.2d 1014, 1016-17 (4th
Cir. 1981) ("Ordinarily the jurisdictional
amount is determined by the amount of the plaintiffs
original claim, provided that the claim is made in good faith.'"). If the plaintiffs
complaint
alleges less than $75.000, then a defendant who seeks to remand must show to a legal certainty
that the amount in controversy is above $75,000. See j'vfomin v. Maggiemoo's Intern., L.L.c., 205
F.Supp. 2d 506, 509 (D. Md. 2002) ("Where a plaintiff claims a specific amount in damages that
is less than $75,000, removal is proper only if the defendant can prove to a 'legal certainty' that
the plaintiff would actually recover more than that if she prevailed.").
Under certain circumstances, a plaintiffs
smaller claims can be aggregated to reach the
$75,000 required for federal diversity jurisdiction. Shanaghan v. Cahill, 58 FJd 106, 109 (4th
Cir. 1995). For example, in Shanaghan. the plaintiff sought recovery on three separate debts and
jurisdiction was proper because the amount of the debts together, but not individually, met the
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threshold amount for federal jurisdiction. Ill. at 108-09; see also Siegeri.~t 1'. Blaw-Knox Co., 414
F.2d 375. 381 (8th Cir. 1969) (permitting aggregation of the values of a trademark infringement
claim and a unfair competition claim to measure the amount in controversy); Connolly
1'.
Vol\"{)
Trucks North America. Inc.. 208 F.R.D. 600, 600-01 (N.D. 111.2002) (aggregating plaintiffs
three claims where each claim asserted its own injury and request for compensation: one claim
was for pain and suffering prior to death, one claim was for survivors' pecuniary loss due to
decedent's death, and one claim was for medical and funeral expenses as a result of decedent's
death).
By contrast, claims that are simply pleading alternative legal theories to recover for one
harm cannot be aggregated to reach the amount in controversy threshold. See Delph
Home lv/ortg.. Inc., 478 F.Supp. 2d 852, 854-55
Comercializacion
1'.
Allstate
(D. Md. 2007); Instituto Nacional De
Agricola (Indeca) v. Continental Ill. Nat'! Bank & Trust Co. of Chi..576 F.
Supp. 991, 1004 (N.D. 111.1983).In other words, " ...
where two or more claims are alternative
theories for recovery of the same harm, they may not be aggregated."
Consumer Prods., 371 F.Supp. 2d 943, 947 (N.D. Ill. 2005).
Gallo v. Homelite
[n Instiluto, a plaintiff sought
recovery of money paid for goods under two separate theories-breach
of contract and fraud.
576 F.Supp. at 1004. Although the plaintiff requested actual damages under each theory, plaintiff
could not recover the actual damages twice under the two separate theories. Ill.
Here, in count one, Plaintiff alleges negligent servicing and/or failure to use due diligence
for improperly rejecting Plaintiff s student loan payments and thereby intlating the interest on
Plaintiffs
loan. ECF NO.4 at ~ 7-30. He asserts that Defendants had a duty to properly service
his loan and ensure that payments were applied to his student loans. Ill. at ~ 8. Plaintiff alleges
that Defendants did not process his checks and improperly assessed interest against his loan. Ill.
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at 'll18. According to Plaintiff, Defendants rejected his payments and then falsely established that
Plaintiff was in default to share in the profits from collection costs. Jd at 'll 27. He requests
$50,000 in damages. Jd at'll 30. In count three, Plaintiff asserts a claim for defamation, libel, and
slander based on allegations that the Defendants falsely reported that Defendant was delinquent
on his student loans. Jd. at 'll 42. Plaintiff alleges that because Defendants reported his loans as
being delinquent, he suffered a lower "FICO" score, was denied employment, was humiliated,
and suffered mental anguish. Jd at
'1 45.
He requests $50,000 in damages on this count as well.
Jd.
Based on these two counts alone, PlaintifT could potentially recover damages of $50,000
for Defendants'
alleged negligence in failing to process his loan payment and inflating the
interest owed and recover separate damages of $50,000 for Defendants'
that caused Plaintiff to be humiliated and denied employment.
false credit reporting
These are not two separate
theories for the same recovery. Unlike the buyer in Jns/i/lI/o, who alleged that she lost a specific
amount of money due either to the seller's breach of contract or to the seller's fraud, 576 F.
Supp. at 1004. here, Plaintiff is alleging separate injuries. Plaintiffs damage requests as to the
negligent services claim and as to the defamation. libel. and slander claim are similar to the
separate damage requests in Connolly, 208 F.R.D. at 601. for (I) pain and suffering damages and
(2) medical and funeral expenses. As such. the Complaint. on its face, alleges over $75,000 in
damages and satisfies the amount in controversy for federal diversity jurisdiction. See 28 U.S.c.
S
1332. As Plaintiffs
Complaint puts the amount in controversy above $75.000. Defendants are
not required to prove to a legal certainty that Plaintiff could recover more than $75,000 if he
prevailed. See Momin v. Maggiemoo's
JmeJ'n.. L.L.c.. 205 F.Supp. 2d 506, 509 (D. Md. 2002)
("Where a plaintiff claims a specific amount in damages that is less than $75.000. removal is
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proper only if the defendant can prove to a 'legal certainty' that the plaintiff would actually
recover more than that ifshe prevailed.").
3.
Waiver
Plaintiff also argues that Defendants waived their right to removal by filing a motion to
dismiss in the state court action. "For waiver to have occurred, a defendant must have taken
some affirnlative action in state court after its right to remove exists," Johnson v. Celolex Corp.,
701 F.Supp. 553,555 (D. Md. 1988), superseded by slall/le on olher grol/nds as slaled in Zl/mas
v. Owens-Corning
Fiberglas COl]).. 907 F.Supp. 131, 132 (D. Md. I995). A defendant's action
must be a "clear and unequivocal" intent to remain in state court. Grubb v. Donegal Ml/I. Ins.
Co., 935 F.2d 57, 59 (4th Cir. 1991). This type of waiver should only be found in "extreme
situations," lei. (citation and internal quotation marks omitted).
A review of the state court proceedings quickly resolves this issue in Defendants' favor.
Although Plaintiff submits to the Court that Defendants took affirmative action in state court by
filing a motion to dismiss his amended complaint, there is no doubt that Defendants' motion to
dismiss was a motion to dismiss Plaintiffs
original complaint. See ECI' No. 21-2. Plaintifl's
original complaint contained six counts and his amended complaint contains twelve counts. See
ECF Nos. 2 & 4. Further, Plaintiffs original complaint, on its face, alleged less than $75,000 in
damages. See ECF NO.2. Defendants' motion to dismiss only addressed the six counts of the
original complaint. See ECF No. 21-2.1 It was only after Plaintiff amended his complaint and
changed the amount in controversy that Defendants sought to remove the action to federal court.
ECI' No. I at ~~ 2 & 4. The only action Defendants took related to the amended complaint was
I Notably, Plaintiff previously argued, in his opposition to Defendants' state court motion to
dismiss, that the motion to dismiss was moot because it related to his original complaint and not
the newly filed amended complaint. ECF No. 21-4 at 9-10.
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removal, thus Defendants have not waived their right to remove. See Johnson v. Celofex Corp.,
701 F.Supp. at 555 ('"For waiver to have occurred, a defendant must have taken some affirmative
action in state court after its right to remove exists.'") (emphasis added).
4.
Failure to attach state court documents
PlaintifT challenges Defendants' removal as defective for failure to attach all of the state
court documents. Defendants filed the required documents within the time permitted by Local
Rule 103.5, rendering Plaintiffs argument moot. See ECF No. 21 & Local Rule 103.5.
5.
Attorney's fees
Finally, Plaintiff requests that this Court impose fair and just compensation to Plaintiff
under 28 U.S.C.
U.S.c.
S
S
1447(c) for the time he expended in bringing his motion for remand. See 28
1447(c). As Plaintiff acknowledges in a separate part of his motion, Plaintiff is not an
attorney and is not entitled to attorney's fees. Kay
I'.
Ehrler, 499 U.S. 432, 432 (1991); Doe v.
Bd. o.fEduc. (J{Balfimore County, 165 F.3d 260, 262 (4th Cir. 1998). Regardless, Plaintiff would
not otherwise be entitled to attorney's fees because the case is not subject to remand. See 28
U.S.c.
S
1447(c) ("An order remanding the case may require payment of just costs and any
actual expenses, including attorney fees, incurred as a result of the removal. ").
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III.
CONCLUSION
For the reasons stated above, it is ORDERED. that Plaintiff's Motion to Remand Case
(ECF No. 11) is DENIED. Defendants' Motion to Amend Notice of Removal (ECF No. 18) is
GRANTED.
A separate Order shall issue.
Dated: October 20, 2014
GEORGEJ.HAZEL
UNITED STATES DISTRICT JUDGE
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