Mendoza et al v. J.P. Morgan Mortgage N.A. et al
ORDER re 8 MOTION to Remand, 4 MOTION to Dismiss , J.P. Morgan Mortgage N.A. and David R Karle (as Substitute Trustee) terminated(Signed by Judge Micaela Alvarez) Parties notified.(BelindaSaenz, 7)
United States District Court
Southern District of Texas
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
CRISELDA MENDOZA, et al,
J.P. MORGAN MORTGAGE N.A., et al,
June 27, 2017
David J. Bradley, Clerk
§ CIVIL ACTION NO. 7:17-CV-180
The Court now considers the motion to remand,1 filed by Criselda Mendoza (“Ms.
Mendoza”) and Jose A. Muro (“Mr. Muro”) (“Plaintiffs”), as well as the unopposed motion to
dismiss,2 filed by JPMorgan Chase Bank, N.A., incorrectly named as J.P. Morgan Mortgage
N.A. (“JPMC”). After duly considering the record and relevant authorities, the Court DENIES
the motion to remand and GRANTS the motion to dismiss.
Plaintiffs allege that they executed a promissory note to purchase real property located at
145 W. Dicker Dr., Pharr, Texas (“the property”).3 In its response to the motion to remand,
Select Portfolio Servicing, Inc. (“SPS”) asserts that Mr. Muro is deceased and has been named in
an improper capacity.4 Furthermore, SPS contends that Ms. Mendoza was not a party to the
original loan agreement, but she nevertheless signed the Deed of Trust, 5 which granted a security
Dkt. No. 8.
Dkt. No. 4. The motion is now unopposed, as Plaintiffs did not file a response. See LR 7.2 of the Local Rules of
the United States District Court for the Southern District of Texas.
Dkt. No. 1-4, at p. 2.
Dkt. No. 9, at ¶ 1, n. 1.
Id. at ¶ 2.
interest in the property.6 Plaintiffs explain that they made required payments for more than
thirteen years, but “due to unexpected circumstances[,] Plaintiffs stayed behind on a few
payments.”7 Plaintiffs allege that they “were not allowed their legal right to cure” and
“Defendants have not made a due diligent effort to allow Plaintiffs to bring the account current[,]
despite the fact that Plaintiffs have tried to make their payment[.]”8 The property was scheduled
for foreclosure on May 2, 2017.9
In April 2017, Plaintiffs filed suit in state court against JPMC, SPS, and David R. Karle,
as substitute trustee (“David Karle”) (collectively “Defendants”), generally alleging wrongful
foreclosure and a Texas Property Code violation.10 Plaintiffs additionally request both a
temporary restraining order and temporary injunction to enjoin Defendants from taking any steps
to foreclose on the property.11 SPS subsequently removed the case pursuant to 28 U.S.C. §§ 1332
and 1441, asserting federal question and diversity jurisdiction.12 Thereafter, JPMC filed a motion
to dismiss and Plaintiffs filed a motion to remand. JPMC and SPS filed responses to the motion
Motion to Remand
The removing party bears the burden of establishing whether federal jurisdiction exists,14
and the Court must resolve all doubts regarding whether removal jurisdiction is proper in favor
of remand.15 The Court does not have subject matter jurisdiction under 28 U.S.C. § 1332(a)
Dkt. No. 1-4, at p. 2.
Id. at p. 2.
Id. at pp. 3–4.
Id. at pp. 4–6.
Dkt. No. 1, at ¶¶ 5–21.
Dkt. Nos. 9, 10.
Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001) (citation omitted).
Acuna v. Brown & Root, Inc., 200 F.3d 335, 339 (5th Cir. 2000).
unless the parties are completely diverse and the amount in controversy exceeds $75,000.00.16
Generally, “the sum demanded in good faith in the initial pleading shall be deemed to be the
amount in controversy.”17 However, when state practice does not permit a demand for a specific
sum, removal is proper if the removing party proves by a preponderance of the evidence that
amount in controversy exceeds $75,000.00.18 A defendant can satisfy this burden by (1) showing
it is “apparent from the claims of the petition that the claims are likely to exceed $75,000” or (2)
setting forth “summary judgment-type evidence of facts in controversy that support a finding of
the requisite amount.”19
Further, the residency of non-diverse defendants who have been improperly joined is not
considered for diversity jurisdiction purposes.20 The Fifth Circuit recognizes two manners by
which improper joinder may occur: “(1) actual fraud in the pleading of jurisdictional facts, or (2)
[the] inability of the plaintiff to establish a cause of action against the non-diverse party in state
court.”21 The Fifth Circuit has interpreted the second manner to mean that “there is no reasonable
basis for the district court to predict that the plaintiff might be able to recover against an in-state
defendant.”22 To determine whether a plaintiff has a reasonable basis for recovery, courts
evaluate the sufficiency of the pleadings against non-diverse parties under the federal pleading
28 U.S.C. § 1332(a).
Id. § 1446(c)(2).
Id.; see also De Aguilar v. Boeing Co., 11 F.3d 55, 58 (5th Cir. 1993).
Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002) (quotation marks and citations
Salazar v. Allstate Tex. Lloyd’s, Inc., 455 F.3d 571, 574 (5th Cir. 2006).
Smallwood v. Ill. Cent. R. Co., 385 F.3d 568, 573 (5th Cir. 2004).
Int’l Energy Ventures Mgmt., L.L.C. v. United Energy Grp., Ltd., 818 F.3d 193, 208 (5th Cir. 2016).
Twombly and Iqbal lay out a two-prong approach to motions to dismiss under Federal
Rule of Civil Procedure (“Rule”) 12(b)(6) dismissal motions,24 which is relevant here for
understanding what constitutes the baseline federal pleading standard.25 First, the plaintiff must
plead “enough facts to state a claim to relief that is plausible on its face.”26 A claim has facial
plausibility when its factual content “allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.”27 Second, the plaintiff must prove the plausibility
of his claim with case-specific facts, not mere conclusions: “a pleading that offers labels and
conclusions or a formulaic recitation of the elements of a cause of action will not do.”28 “Nor
does a complaint suffice if it tenders naked assertion[s] devoid of further factual enhancement.”29
Thus, although courts must accept as true all well-pleaded facts, they need not accept as true
overt legal conclusions, or legal conclusions which have been “couched” as factual allegations.30
Diversity of Citizenship
Plaintiffs’ original petition contends that all parties are citizens of Texas.31 There is no
dispute that Plaintiffs and David Karle are citizens of Texas. Plaintiffs allege that SPS and JPMC
are Texas corporations that regularly conduct business in Texas, and that they can be served
through David Karle, their “registered agent of service and/or trustee[.]”32 However, SPS and
JPMC are residents of Utah33 and Ohio,34 respectively, for diversity jurisdiction purposes. As a
Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009) (“Our decision in Twombly illustrates the two-pronged approach.”).
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).
Iqbal, 556 U.S. at 678.
Id. (“Although for the purposes of a motion to dismiss we must take all of the factual allegations in the complaint
as true, we are not bound to accept as true a legal conclusion couched as a factual allegation.”).
Dkt. No. 1-4, at pp. 1–2.
Dkt. No. 1, at ¶ 9; Allen v. Wash. Mut. Bank, 2015 WL 4395141, at * 3 (W.D. Tex. July 16, 2015) (“SPS is a
corporation incorporated under the laws of Utah with its principal place of business in Salt Lake City, Utah, and is
therefore a citizen of Utah for purposes of diversity jurisdiction.”).
result, there is diversity of citizenship between Plaintiffs, SPS, and JPMC. The Court will now
engage in an improper joinder analysis to determine whether David Karle is a proper party to this
Plaintiffs do not allege any cause of action against David Karle. In fact, David Karle’s
name does not appear anywhere in the original petition beyond the introductory material that
presents the parties and underlying facts of the lawsuit. Although Plaintiffs request both a
temporary restraining order and temporary injunction against all named Defendants generally,35
there are insufficient facts to support any particular cause of action against David Karle. As such,
Plaintiffs fail to state a claim against David Karle, and thus he was improperly joined.
Accordingly, David Karle is DISMISSED WITH PREJUDICE. Since the only remaining
named Defendants, SPS and JPMC, are completely diverse from Plaintiffs, the Court will now
consider the amount in controversy.
Amount in Controversy
Plaintiffs claim that diversity jurisdiction is improper in this case because the amount in
controversy has not been satisfied.36 As previously noted, a plaintiff’s pleading for a specific sum
made in good faith must be deemed the amount in controversy; however, this request does not
control when made in bad faith or when state practice does not permit demand for a specific
sum.37 In Texas, the law does not permit a plaintiff to plead for a specific amount. Rather, Texas
Rule of Civil Procedure (“TRCP”) 47 requires a pleading to contain a statement that the damages
sought are within the jurisdictional limits of the court, and a statement that a party seeks a pre34
Dkt. No. 10, at p. 3 (“For purposes of 28 U.S.C. § 1348[,] a national bank is a citizen of the state in which its main
office, as set forth in its articles of association, is located. Defendant JPMC is a national association with its main
office, as designated by its articles of association, in Columbus, Ohio. Accordingly, JPMC is a citizen of Ohio for
purposes of diversity jurisdiction.”) (internal citation omitted).
Dkt. No. 1-4, at pp. 4–6.
Dkt. No. 8, at ¶ 3 (“The amount in controversy is less than $75,000, excluding interest and costs. The amount in
controversy is $40,388.00, the amount of the original note.”).
28 U.S.C. § 1446(c)(2).
defined range of damages.38 Plaintiffs attempted compliance with TRCP as they pled for
damages “over $58,650.00 but not more than $70,000.00 and also non-monetary relief.”39
However, this does not comport with TRCP 47. Ultimately, however, the Fifth Circuit ruled that
“[i]n actions enjoining a lender from transferring property and preserving an individual’s
ownership interest, it is the property itself that is the object of the litigation; the value of that
property represents the amount in controversy.”40
As noted, Plaintiffs’ original petition alleges an amount in controversy of over
$58,650.00.41 Plaintiffs’ motion to remand, however, contends an amount in controversy of
“$48,388.00, the amount of the original note.”42 In its notice of removal, SPS argued that “the
value of the [p]roperty was not less than $76,990.00 since the value of the [p]roperty was at all
relevant time no less than that amount.”43 SPS attached a valuation of the property at $76,990.00
from the Hidalgo County Appraisal District.44 This Court has previously ruled that the fair
market value of the property as determined by a county appraisal district is appropriate for
determining the amount in controversy.45 As a result, SPS has demonstrated that the amount in
controversy exceeds the jurisdictional threshold of $75,000.00.
Complete diversity exists among the remaining parties and the amount in controversy
exceeds $75,000.00. Thus, the Court DENIES the motion to remand.
Tex. R. Civ. P. 47(b)–(c).
Dkt. No. 1-4, at p. 1.
Farkas v. GMAC Mortg., L.L.C., 737 F.3d 338, 341 (5th Cir. 2013).
Dkt. No. 1-4, at p. 2.
Dkt. No. 8, at ¶ 3.
Dkt. No. 9, at ¶ 21.
Dkt. No. 1-11, at p. 1.
Ouzenne v. Deutsche Bank Nat’l Trust Co. for Soundview Home Loan Trust 2006-3, Asset-Backed Certificates,
Series 2006-3, 2017 WL 1437297 at *4 (S.D. Tex. Apr. 24, 2017).
Motion to Dismiss
In its motion to dismiss, JPMC argues that Plaintiffs failed to state a claim against
JPMC.46 Plaintiffs’ original petition is devoid of any specific causes of action against JPMC. In
fact, Plaintiffs generally allege wrongdoing by “Defendants.” This Court has ruled that “[a]
complaint does not satisfy the requirements of Iqbal and Twombly by lumping together all
defendants, while providing no factual basis to distinguish their conduct.”47 Plaintiffs have not
presented any facts to differentiate the conduct of JPMC and SPS. Ultimately, Plaintiffs tender
naked assertions without any additional factual support and fail to allege any particular liability
of JPMC that differs from SPS as required by this Court. Furthermore, JPMC explains that it “is
not the mortgage servicer or the mortgagee[,]” and thus is not a property party to this lawsuit. 48
As a result, and in light of the fact that Plaintiffs have not filed a response, the Court GRANTS
the motion to dismiss. JPMC is hereby DISMISSED WITH PREJUDICE.
For all the foregoing reasons, the Court DENIES the motion to remand and GRANTS
the motion to dismiss. Additionally, David Karle and JPMC are hereby DISMISSED WITH
IT IS SO ORDERED.
DONE at McAllen, Texas, this 27th day of June, 2017.
United States District Judge
Dkt. No. 4, at pp. 3–4.
Del Castillo v. PMI Holdings N. Am. Inc., 2015 WL 3833447 at *6 (S.D. Tex. June 22, 2015).
Dkt. No. 4, at p. 4. See also Dkt. No. 4-1, at p. 3.
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