Scotiabank v. Halais-Borges

Filing 21

MEMORANDUM AND ORDER re 19 Motion for Attorney's Fees: GRANTED. Halais is ORDERED to pay Scotiabank $1,762.50, the amount of attorneys' fees incurred as a result of the removal and subsequent remand of this action. Signed by Judge Francisco A. Besosa on 12/11/2018. (brc)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
SCOTIABANK DE PUERTO RICO,
Plaintiff,
v.

Civil No. 18-1350 (FAB)

ERIC SANTIAGO HALAIS-BORGES,
Defendant.

MEMORANDUM AND ORDER
BESOSA, District Judge.
The Court remanded this action to the Puerto Rico Court of
First Instance, San Juan Superior Division, case number K CD 20121782.

(Docket No. 16.)

Plaintiff Scotiabank de Puerto Rico

(“Scotiabank”) requests the Court to order defendant Eric Santiago
Halais-Borges (“Halais”) to pay attorneys’ fees pursuant to 28
U.S.C. section 1447(c) (“section 1447”).

(Docket No. 19.)

For

the reasons set forth below, the Court GRANTS Scotiabank’s motion
for attorneys’ fees.
I.

Background
On May 7, 2018, Halais filed a notice of removal.

No. 1.)

(Docket

Halais invoked the Court’s federal question jurisdiction

pursuant to 28 U.S.C. § 1331, asserting that the “Commonwealth
Court Action concern[ed] a suit for mortgage foreclosure and
collection of monies owed by [Halais] to [Scotiabank].”

Id. at

Civil No. 18-1350 (FAB)

2

p. 1 (citing Scotiabank v. Eric Santiago Halais-Borges, Civil Case
No. K CD 2012-1782).
law.

Both claims arise pursuant to Puerto Rico

See P.R. Laws Ann. tit 31, § 5171 (“A debtor is liable for

the fulfillment of his obligations with all his present and future
property.”).

Halais set forth a myriad of affirmative defenses

pursuant to eight federal statutes. 1
Scotiabank opposed removal, arguing that the Court lacked
jurisdiction.

(Docket No. 12.)

holding

the

that

federal

The Court remanded this action,

statutes

“raise[d]

in

defense

of

Scotiabank’s Puerto Rico law claims [were] insufficient to confer
jurisdiction on this Court.”

Scotiabank de P.R. v. Halais-Borges,

No. 18-1350, 2018 U.S. Dist. LEXIS 182535 *5 (D.P.R. Oct. 22, 2018)
(Besosa, J.); see Scotiabank de P.R. v. Residential Partners S.E.,
350 F. Supp. 2d 334, 337 (D.P.R. 2004) (Pieras, J.) (remanding
action based on collection of monies and mortgage foreclosure
pursuant to Puerto Rico law because an affirmative defense arising
from the federal Bank Holding Company Act was “insufficient to
confer federal jurisdiction”).

1

Scotiabank seeks payment of the

Halais alleges that Scotiabank violated the: (1) Truth in Lending Act, 15
U.S.C. § 1601 et seq., (2) the Real Estate Settlement Procedures Act, 12 U.S.C.
§ 2600 et seq., (3) the Home Mortgage Disclosure Act, 12 U.S.C. § 2801 et seq.,
(4) the Home Ownership and Equity Protection Act, 15 U.S.C. § 1639, (5) the
Equal Credit Opportunity Act, 15 U.S.C. § 1691 et seq., (6) the Fair and Accurate
Credit Transactions Act, 15 U.S.C. § 1681 et seq., (7) the Homeowner’s
Protection Act, 12 U.S.C. §§ 4901-4910, and (8) the Fair Debt Collection
Practices Act, 15 U.S.C. § 1692 et seq. (Docket No. 1 at pp. 1—2.)

Civil No. 18-1350 (FAB)

3

attorneys’ fees stemming from the removal and subsequent remand of
this action.
II.

(Docket No. 19.)

Attorneys’ Fees Pursuant to Section 1447
Section 1447 provides that an “order remanding the case may

require payment of just costs and any actual expenses, including
attorneys’ fees, incurred as a result of the removal.”
§ 1447(c).

28 U.S.C.

The United States Supreme Court has noted that “[t]he

process of removing a case to federal court and then having it
remanded back to state court delays resolution of the case, imposes
additional costs on both parties, and wastes judicial resources.”
Martin v. Franklin Capital Corp., 546 U.S. 132, 140 (2005); see
Cortés-Pacheco v. PBF-TEP Acquisitions, Inc., No. 15-1460, 2015
U.S. Dist. LEXIS 171876 *16 (D.P.R. Dec. 23, 2015) (Fusté, J.)
(granting motion for attorneys’ fees, because “[a]ll that the
removal accomplished was eight months of needless litigation and
expense”).
An award of fees pursuant to section 1447 is committed to the
sound discretion of the district court.

See Martin, 546 U.S. at

138-39. There is neither a strong presumption in favor of awarding
fees on remand, nor a strong bias against fee awards.

Id. (noting

that there is “nothing to . . . [suggest] that fees under § 1447(c)
should either usually be granted or usually be denied”).

Because

there is “no heavy congressional thumb on either side of the scales

Civil No. 18-1350 (FAB)
.

.

.

the

standard

4
for

awarding

reasonableness of the removal.”

fees

should

turn

Id. at 139-41.

on

the

Consequently,

“[a]bsent unusual circumstances, courts may award attorneys’ fees
under § 1447(c) only where the removing party lacked an objectively
reasonable basis for seeking removal.”

Id. at 141.

does not require a finding of bad faith.

Section 1447

Net 2 Press, Inc. v.

Nat’l Graphic Supply Corp., 324 F. Supp. 2d 15, 19 (D. Me. 2004)
(citing Excell, Inc. v. Sterling Boiler & Mech., Inc., 106 F.3d
31, 32 (10th Cir. 1997)).
III. Discussion
Scotiabank

argues

that

no

supported removal to this Court.

objectively

reasonable

(Docket No. 19.)

basis

According to

Scotiabank, an award of attorneys’ fees is warranted because the
notice of removal failed to raise “any federal claim whatsoever.”
(Docket No. 19 at p. 3.)
In

actions

premised

The Court agrees.
exclusively

on

state

law,

litigants

cannot invoke the Court’s subject matter jurisdiction by asserting
defenses pursuant to federal law.

Rosselló-González v. Calderón-

Serra, 398 F.3d 1, 10 (1st Cir. 2004) (“The existence of a federal
defense is not sufficient for removal jurisdiction.”) (citing
Franchise Tax. Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1,
10 (1983) (“[A] federal court does not have original jurisdiction
over a case in which the complaint presents a state-law cause of

Civil No. 18-1350 (FAB)

5

action, but also asserts . . . a federal defense the defendant may
raise is not sufficient to defeat the claim.”)); Ten Taxpayer Grp.
v. Cape Wind Assoc., 373 F.3d 183, 191 (1st Cir. 2004) (“It is
hornbook law that a federal defense does not confer ‘arising under’
jurisdiction, regardless whether that defense is anticipated in
the plaintiff’s complaint.”).
The relevant precedent is explicit:

the federal statutes

raised in defense of Scotiabank’s Puerto Rico law claims cannot
establish subject matter jurisdiction.

See Scotiabank of P.R. v.

Sánchez-Castro, 227 F. Supp. 3d 188, 195 (D.P.R. 2017) (Besosa,
J.) (granting motion for attorneys’ fees, because “a minimal amount
of research on [the defendant’s part] would have revealed to him
that supplemental jurisdiction does not constitute an independent
ground for removal jurisdiction”); Rafter v. Stevenson, 680 F.
Supp. 2d 275, 281 (D. Me. 2010) (holding that the “defendant lacked
an objectively reasonable basis for [removal],” because the “legal
principles on which [the] case turns are established and clear”).
Accordingly, Halais lacked an objectively reasonable basis to
remove this action.
Four months elapsed between the notice of removal and remand.
Removal consumed judicial resources, inflated litigation costs,
and prolonged the resolution of this action.

Ultimately, removal

Civil No. 18-1350 (FAB)

6

to this Court constituted an unwarranted stay of the Commonwealth
of Puerto Rico action.

An award of attorneys’ fees is proper.

Halais presents two arguments in opposition to Scotiabank’s
motion for attorneys’ fees.

(Docket No. 20 at pp. 5-6.)

Halais

which

cites

precedent

in

the

removing

reasonable stand on an unsettled principle of law.”

party

First,
“took

a

Docket No. 20

at p. 5 (citing Garnier v. Andin Intern, Inc., 884 F. Supp. 58, 62
(D.R.I. 1995) (denying request for attorneys’ fees because “this
was a tough case that resulted in setting a precedent for [the
First Circuit]”)).

Second, Halais submits that the foreclosure

and collection of monies claims raised by Scotiabank are preempted
by federal law.

Docket No. 20 at p. 6 (citing Negrón-Fuentes v.

UPS Supply Chain Solutions, 532 F.3d 2, 6 (1st Cir. 2008) (holding
that the plaintiff’s state law claims, “if completely preempted by
[the Employee Retirement Income Security Act], can support removal
of the entire action”)).
Nothing in the record suggests that the causes of action set
forth in Scotiabank’s complaint present novel questions of law.
See García v. Amfels, Inc., 254 F.3d 585, 588 (5th Cir. 2001)
(affirming

imposition

of

attorneys’

fees,

because

“[d]espite

appellant’s attempt to conjure up a conflict in this Court’s
caselaw, there is no question that the [Longshore and Harbor
Worker’s Compensation Act] does not create federal subject matter

Civil No. 18-1350 (FAB)

7

jurisdiction supporting removal”). The mere reference to a federal
statute does not demonstrate that the doctrine of preemption is
applicable.

Accordingly, Halais’ arguments are unavailing.

Scotiabank seeks payment of attorneys’ fees in the amount of
$1,762.50.

(Docket No. 19 at p. 5.)

Ramón Luis Nieves (“Nieves”),

counsel for Scotiabank, submitted an affidavit under penalty of
perjury concerning the legal services he provided in this matter.
(Docket No. 19, Ex. 1.)

Nieves states that the removal to this

Court required him to work 13.75 hours at a rate of $100.00 an
hour.

Id.

Counsel’s paralegal worked 7.75 hours at a rate of

$50.00 an hour.

Id.

This Court may “rely upon its own knowledge

of attorney’s fees in its surrounding area in arriving at a
reasonable hourly rate.”

Andrade v. Jamestown Hous. Auth., 82

F.3d 1179, 1190 (1st Cir. 1996) (holding that the court imposed a
reasonable

amount

of

attorneys’

fees

by

“determin[ing]

the

prevailing market rate for federal civil rights litigation by
utilizing his knowledge and experience of the Providence, Rhode
Island,

market

while

plaintiff’s] counsel”).

considering

the

customary

rate

of

[the

The Court is satisfied that $1,762.50 is

a reasonable amount.
IV.

Conclusion
For the reasons set forth above, the Court GRANTS Scotiabank’s

motion for attorneys’ fees.

(Docket No. 19.)

Halais is ORDERED

Civil No. 18-1350 (FAB)

8

to pay Scotiabank $1,762.50, the amount of attorneys’ fees incurred
as a result of the removal and subsequent remand of this action.
IT IS SO ORDERED.
San Juan, Puerto Rico, December 11, 2018.

s/ Francisco A. Besosa
FRANCISCO A. BESOSA
UNITED STATES DISTRICT JUDGE