Moore v. American Home Mortgage Corporation et al

Filing 34

ORDER Granting 7 Motion to Remand to State Court. Signed by Judge Roger L. Hunt on 9/8/11. (Copies have been distributed pursuant to the NEF - ASB)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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***

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ANTONIA MOORE,

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Plaintiff,
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vs.
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AMERICAN HOME MORTGAGE CORP.;
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WELLS FARGO BANK, N.A. in its own right )
and WELLS FARGO BANK, N.A. as trustee )
for OPTION ONE MORTGAGE LOAN
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TRUST 2006-1 ASSET-BACKED
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CERTIFICATES, SERIES 2006-1; POWER
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DEFAULT SERVICES, INC.; FIDELITY
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NATIONAL TITLE INSURANCE COMPANY )
INC.; and DOES 1-100;
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Defendants.
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_______________________________________)

Case No.: 2:11-cv-00268-RLH-GWF
ORDER
(Motion to Remand–#7)

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Before the Court is Plaintiff Antonia Moore’s Motion to Remand (#7, filed March

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16, 2011) based on a lack of unanimity of consent among Defendants. The Court has also

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considered American Home Mortgage Corporation, Wells Fargo Bank, N.A., and Power Default

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Services, Inc.’s (“Removing Defendants”) Opposition (#9, filed March 22, 2011), Fidelity

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National Title Insurance Company, Inc.’s separate Opposition (#10, filed March 22, 2011), and

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Plaintiff’s Replies (##12,13 filed March 27, 2011).

AO 72
(Rev. 8/82)

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BACKGROUND
This case arose out of a foreclosure on residential real estate. Antonia Moore, the Plaintiff,

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used a loan from Defendant, American Home Mortgage Corp., to purchase property located at

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1620 Silver Slipper Ave., Henderson, Nevada 89015-9334 (the “Property”) which is the subject of

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this action. Plaintiff alleges Defendants wrongfully foreclosed on the Property.

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Plaintiff filed suit in the Eighth Judicial District Court for the State of Nevada (“State

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Court”) on January 19, 2011. The Removing Defendants removed the case on February 17.

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However, Fidelity, unaware of its co-defendants’ removal, filed a Motion to Dismiss in State

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Court on February 18. After learning of removal, Fidelity filed a Certificate of Interested Parties

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with this Court on February 28 (#5). Later, on March 11, Fidelity submitted a “Notice, Consent,

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and Reference of A Civil Action” to consent to proceed before a Magistrate Judge. Finally,

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Fidelity filed a Joinder to Petition for Removal on March 18 (#8).

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Now before the Court is Plaintiff’s Motion to Remand. For the reasons discussed below,

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the Court grants Plaintiff’s Motion to Remand and defers ruling on the remaining motions for the

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State Court.

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DISCUSSION

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Plaintiff contends this Court must remand this action for three related reasons: (1) the

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Petition for Removal is facially defective by lacking the mere averment that all the defendants

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consented to removal; (2) Removing Defendants did not affirmatively state why defendant

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Fidelity’s joinder was omitted; and (3) Fidelity did not cure the facial defect by manifesting

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consent or joining within thirty days of service.

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If a defendant has improperly removed a case, the federal court shall remand the case to

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state court. 28 U.S.C. § 1447(c). For proper removal in a case involving multiple defendants, all

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defendants must consent to the removal. Proctor v. Vishay Intertechnology Inc., 584 F.3d 1208,

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1224 (9th Cir. 2009). In Proctor, the Ninth Circuit held that this circuit does not require parties to

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formally join in a notice of removal or for parties to file individual documents showing consent to

AO 72
(Rev. 8/82)

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removal as some other circuits do. Id. In the Ninth Circuit, “[o]ne defendant’s timely removal

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notice containing an averment of the other defendants’ consent and signed by an attorney of record

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is sufficient.” Id.

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Yet, when fewer than all the Defendants join in a removal action, the removing party must

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affirmatively state the reasons for the absence of a missing co-defendant. Prize Frize, Inc. v.

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Matrix (U.S.) Inc., 167 F.3d 1261, 1266 (9th Cir. 1999) abrogated on other grounds by Abrego

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Abrego v. The Dow Chem. Co., 443 F.3d 676, 681 (9th Cir. 2006). Parties must cure facially

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defective petitions within the thirty-day statutory period permitted to join in removal. Id. The

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thirty-day statutory period begins upon service of process. 28 U.S.C.§ 1446(b). Removal statutes

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are strictly construed against removal and federal jurisdiction must be rejected if there is doubt as

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to the right of removal. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). The defendant

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always has the burden of establishing proper removal. Id.

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Here, Fidelity concedes it “did not receive notice of the Petition for Removal.”

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Consequently, Fidelity could not have consented to a removal action prior to Removing

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Defendants filing the petition. Under Prize Frize, Inc., the absence of Fidelity from the Petition

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for Removal required an affirmative explanation. The Removing Defendants provided nothing.

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Therefore, the Petition for Removal is facially defective.

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Further, Fidelity did not satisfy its burden of establishing proper removal because Fidelity,

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by its own admission, did not manifest consent until after the thirty-day removal period closed.

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When exactly Fidelity manifested consent to removal is unclear. It is plausible Fidelity manifested

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consent within the thirty-day period by filing its Certificate of Interested Parties on February 28,

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2011. However, the requirement to file a Certificate of Interested Parties derives from a federal

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rule designed merely to provide preliminary information to aid the judicial disqualification

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process. Fed. R. Civ. P. 7.1. Therefore, it is not clear this filing represented consent.

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AO 72
(Rev. 8/82)

More importantly, Fidelity’s statements convey its manifested consent for removal came
later. First, Fidelity argues “Defendants became unanimous in their consent to removal by way of
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[Fidelity’s] Consent to Removal on March 18, 2011.” Second, and contrary to the former

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statement, Fidelity asserts it “filed [its] consent to with [sic] the Federal Court...on March 11,

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2011.” Fidelity’s statements demonstrate its belief that it did not manifest consent until at least

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March 11, 2011–nearly two weeks after the thirty-day period closed.

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Fidelity’s inconsistent statements create doubt about when it manifested consent for

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removal. But, Fidelity admits it manifested consent after the period to cure the facially defective

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Petition for Removal. Therefore, under Gaus, this Court must strictly construe the removal statute

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and find that Fidelity failed to satisfy the burden of proving it manifested consent for removal

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within the requisite time frame.

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In addition, this Court finds no merit in Fidelity’s claims of (1) a non-appearance exception

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to the requirement that all defendant’s join, and (2) fraudulent joinder. First, the case cited by

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Fidelty is non-binding and inapplicable authority. Lewis v. Rego Co., 757 F.2d 66, 68 (3d Cir.

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1985). In Lewis, the Third Circuit cites a case focusing on exceptions to joinder which relate to

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non-service, not non-appearance. Here, Fidelity was served and therefore Lewis is inapplicable.

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Second, Plaintiff’s original Complaint states Fidelity is “believed to be a Delaware

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Corporation.” There can be no fraudulent joinder for the purpose of destroying diversity when the

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Plaintiff acknowledges and lists every defendant as non-residents of Nevada. Therefore, the Court

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grants Plaintiff’s Motion to Remand to State Court and defers ruling on the remaining motions.

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CONCLUSION

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Accordingly, and for good cause appearing,

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IT IS HEREBY ORDERED that Plaintiff’s Motion for Remand (#7) is

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GRANTED.
Dated: September 8, 2011.

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____________________________________
ROGER L. HUNT
United States District Judge

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AO 72
(Rev. 8/82)

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