Citigroup Global Markets Realty Group v. Brown et al
Filing
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REPORT AND RECOMMENDATION re 13 MOTION to Remand to State Court for lack of Subject Matter Jurisdiction Pursuant to 28 USC 1447 (C) filed by Florida Coastal Partners, LLC in that the Court RECOMMENDS that Florida Coastal's motion be granted and this case be remanded to the Court of Common Pleas of Delaware County, Ohio. Objections to R&R due by 8/25/2014. Signed by Magistrate Judge Terence P Kemp on 8/6/14. (sem1)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
Citigroup Global Markets
Realty Corp,
Plaintiff,
:
:
v.
:
:
Ronald Brown, et al.,
Case No. 2:13-cv-1232
JUDGE PETER C. ECONOMUS
Magistrate Judge Kemp
:
Defendants.
REPORT AND RECOMMENDATION
On December 2, 2008, Citigroup Global Markets Realty Corp
filed this mortgage foreclosure action in the Court of Common
Pleas of Delaware County, Ohio, as Case No. 08-CVE-12-1598.
On
December 11, 2013, defendants Ronald Brown and Tonya Brown
(collectively “the Browns”) removed the case to this Court and
subsequently filed an amended notice of removal.
The substitute
plaintiff in the underlying action, Florida Coastal Partners, LLC
(“Florida Coastal”), has filed a motion to remand this case for
lack of subject matter jurisdiction.
(Doc. 13).
The Browns have
filed a memorandum in opposition, and the motion is now ready to
decide.
In its motion, Florida Coastal states that this is the
second attempt by the Browns to remove this case.
On February
23, 2010, the Browns first attempted to remove Case No. 08-CVE12-1598 to this Court.
See Case No. 2:10-cv-165.
On March 15,
2010, Judge Graham issued an order remanding that case to the
Court of Common Pleas based upon his finding that this Court
lacked subject matter jurisdiction.
(Doc. 13, Ex. A); see also
Case No. 2:10-cv-165, Doc. 4.
In his remand order, Judge Graham found that a fair reading
of the petition reflected that the Browns removed the case based
upon their belief that it involved federal questions of law.
Judge Graham, however, found that the complaint in Case No. 08CVE-12-1598 “is a simple mortgage foreclosure action” which did
“not, on its face, raise any claims that arise under federal
law.”
Id. at 2.
Judge Graham noted that the availability of a
federal defense does not alter the “well-pleaded complaint rule,”
under which a “complaint states a federal question only when ‘a
right or immunity created by the Constitution or laws of the
United States [is] an element, and an essential one, of
plaintiff’s cause of action.’” Id., quoting Gully v. First Nat’l
Bank, 299 U.S. 109 (1936).
He also pointed out that this Court
had “specifically held that the existence of federal law defenses
to a mortgage foreclosure action brought under state law does not
make the case removable.”
Id. at 3, quoting James v. Guaranteed
Rate, Inc., 2009 WL 928285, *4 (S.D. Ohio Apr. 6, 2009).
For
these reasons, and because he determined that this foreclosure
case was “an action between private parties that is wholly
governed by state law,” Judge Graham held that the Court did not
have jurisdiction and that the case was improperly removed.
at 3-4.
Id.
Consequently, pursuant to 28 U.S.C. §1447(c), Judge
Graham remanded the action to the Court of Common Pleas of
Delaware County, Ohio.
Here, Florida Coastal argues that all of the findings in
Case No. 2:10-cv-165 are applicable to the Browns’ second attempt
at removal.
The Browns oppose Florida Coastal’s motion to
remand, arguing that “the Defendants’ removal in December, 2013
is under different circumstances than the removal in March,
2010.”
(Doc. 14 at 1).
According to the Browns:
This Court has Subject Matter jurisdiction for several
reasons.
The Defendants Ronald and Tonya Brown have
filed a lawsuit against the Substitute Plaintiff in
Federal Court alleging violations of the Fair Debt
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Collection Practices Act (FDCPA). The State Court case
is a related case. A Federal question arises under 28
U.S. Code §1331 regarding the State Court case.
The
Defendants Ronald and Tonya Brown have filed a lawsuit
against the Substitute Plaintiff in State Court which is
part of this Court’s record. The Plaintiffs may join
related claims to their lawsuit in Federal Court under
Federal Rule of Procedure 18. State Court proceeded to
trial on December 12, 2013 without a jury which is
unlawful under 28 U.S.C. § 1331 because the Defendants
Ronald and Tonya Brown made a “Jury Demand” upon the
filing of their lawsuit in State Court.
Id. at 2.
The Browns appear to argue that this Court has subject
matter jurisdiction because they filed a separate lawsuit in this
Court against Florida Coastal which involves a federal question.
In Case No. 2:13-cv-1225, the Browns sued certain entities and
individuals who they claim defrauded them, violated the Fair Debt
Collection Practices Act, and clouded the title to their property
in connection with the mortgage involved in the foreclosure
action in state court.
Although Case No. 2:13-cv-1225 is a
related case, it is insufficient to confer subject matter
jurisdiction in this case.
As Judge Graham explained in Case No.
2:10-cv-165, the complaint is a simple mortgage foreclosure
action which does raise any claims that arise under federal law.
That has not changed since the prior attempt to remove the case.
Further, “[c]ourts have expressly and clearly rejected attempts
to remove actions based on the relationship of the civil action
to be removed and another separate action already pending in
federal court.”
MFC Twin Builders, LLC v. Fajardo, 2012 WL
3862399, *4 (E.D. Cal. Sept. 5, 2012), adopted and affirmed 2012
WL 4468751 (E.D. Cal. Sept. 27, 2012); see also Evergreen Sch.
Dist. v. N.F., 393 F. Supp.2d 1070, 1075-76 (W.D. Wash. 2005).
The relationship of the two matters simply does not create
federal court jurisdiction over a case where that jurisdiction is
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not present based upon the pleadings in that case.
Consequently,
this Court does not have subject matter jurisdiction over this
removed case.
Alternatively, the Browns argue that because the court in
Case No. 08-CVE-12-1598 held a bench trial as opposed to a jury
trial, this Court has federal question jurisdiction.
The Browns
appear to be arguing that the state court deprived them of their
constitutional right to a jury trial, which they had demanded in
their answer.
Even if they are correct, those facts do not give
rise to federal subject matter jurisdiction over the case.
Their
constitutional argument can be made on appeal to a state court,
but it is not properly raised on removal to this Court because,
again, no federal question is presented in the complaint - the
procedure about which the Browns complain happened well after the
complaint was filed.
It has long been the law that a case cannot
be removed simply to challenge the constitutionality of the state
court proceedings.
See, e.g., In re Stuart, 143 F.Supp. 772, 774
(W.D. Mich. 1956)(remanding a case removed on the basis that the
state court had violated the defendant’s federal due process
rights by ordering a competency examination, and explaining that
“it is well recognized that the grounds for removal must be found
in the declaration or complaint or in the initiatory proceedings
in the State court”).
Further, even if the Browns sought to raise their jury trial
claim as independent cause of action in this Court, it would be
barred by the Rooker-Feldman doctrine.
See District of Columbia
Court of Appeals v. Feldman, 460 U.S. 462 (1983); Rooker v.
Fidelity Trust Co., 263 U.S. 413 (1923).
That doctrine,
explained simply, is that federal district courts do not function
as appellate courts to review and correct errors occurring during
the course of state court proceedings.
As the Court of Appeals
has explained, “[t]he inquiry [under Rooker-Feldman] ... is the
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source of the injury the plaintiff alleges in the federal
complaint.
If the source of the injury is the state court
decision, then the Rooker-Feldman doctrine would prevent the
district court from asserting jurisdiction.”
McCormick v.
Braverman, 451 F.3d 382, 393 (6th Cir. 2006).
Because the source
of the injury alleged by the Browns is the state court’s decision
to hold a bench trial and not a jury trial, this Court has no
jurisdiction to hear the Browns’ claim.
Based upon the foregoing, the Court finds that there is no
basis for federal removal jurisdiction in this case.
Consequently, the Court recommends that Florida Coastal’s motion
to remand (Doc. 13) be granted and this case be remanded to the
Court of Common Pleas of Delaware County, Ohio.
Procedure On Objections
If any party objects to this Report and Recommendation, that
party may, within fourteen days of the date of this Report, file
and serve on all parties written objections to those specific
proposed findings or recommendations to which objection is made,
together with supporting authority for the objection(s).
A judge
of this Court shall make a de novo determination of those
portions of the report or specified proposed findings or
recommendations to which objection is made.
Upon proper
objections, a judge of this Court may accept, reject, or modify,
in whole or in part, the findings or recommendations made herein,
may receive further evidence or may recommit this matter to the
magistrate judge with instructions.
28 U.S.C. §636(b)(1).
The parties are specifically advised that failure to object
to the Report and Recommendation will result in a waiver of the
right to have the district judge review the Report and
Recommendation de novo, and also operates as a waiver of the
right to appeal the decision of the District Court adopting the
Report and Recommendation.
See Thomas v. Arn, 474 U.S. 140
5
(1985); United States v. Walters, 638 F.2d 947 (6th Cir. 1981).
/s/Terence P. Kemp
United States Magistrate Judge
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