Gillespie et al v. Wells Fargo Home Mortgage
ORDER DENYING 111 Motion to Vacate Signed by Judge Kathleen Cardone. (vm1)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TEXAS
EL PASO DIVISION
CAROL L. REEVES, et al.,
WELLS FARGO HOME
MORTGAGE, et al.,
On this day, the Court considered Plaintiff Carol Reeves’s (“Plaintiff”) Motion to Vacate
All Judgments for Lack of Jurisdiction Pursuant to FRCP 60(b) (“Motion to Vacate”), ECF No.
111, in the above-captioned case (the “Case”). For the following reasons, the Motion to Vacate
The Case stems from alleged fraudulent conduct relating to a 2004 mortgage. See Am.
Compl. 2-9, ECF No. 26. On June 28, 2010, Plaintiff, along with co-plaintiff Fern Gillespie,1
filed this action by requesting a temporary restraining order to prevent a “wrongful, illegal, and
fraudulent” foreclosure on Plaintiff’s home. See “Order to Show Cause and TRO” (the
“Complaint”) 5, ECF No. 1. After the Court denied the requested injunctive relief, see July 2,
2010, TRO, ECF No. 4, Plaintiff filed an Amended Complaint on September 13, 2011. See Am.
Compl. By the Amended Complaint, Plaintiff asserted a single federal cause of action alleging
The Court notes that Plaintiff Carol Reeves alone has filed the instant motion and there is no indication that
Plaintiff Fern Gillespie has any interest in pursuing the Motion to Vacate. See Mot. to Vacate 1.
civil RICO violations under 18 U.S.C. § 1692, as well as a number of tort claims under Texas
state law. Id. at 9-16. The Court subsequently ordered Plaintiff to file a RICO case statement by
December 14, 2011. See Nov. 17, 2011, Order 5, ECF No. 50. The Court warned Plaintiff that
failure to file the RICO statement would result in dismissal of Plaintiff’s RICO claim. Id. After
Plaintiff failed to timely file the RICO statement as ordered, the Court dismissed Plaintiff’s
RICO claim on January 5, 2012. See Jan. 5, 2012, Order, ECF No. 57. By doing so, the Court
dismissed Plaintiff’s only federal claim, thus leaving only Plaintiff’s claims sounding in Texas
On January 18, 2012, Defendants Wells Fargo Home Mortgage, Wells Fargo Bank, N.A.,
and Mortgage Electronic Registration System filed their Motion for Summary Judgment. See
Mot. for Summ. J., ECF No. 61. A week later, Defendant Barrett Daffin Frappier Turner &
Engel, LLP filed its Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(c)
(“Motion to Dismiss”), ECF No. 63. The Court granted both the Motion for Summary Judgment
and the Motion to Dismiss on May 11, 2012, thereby deciding Plaintiff’s remaining state law
claims. See May 11, 2012, Order 7-20, ECF No. 79.
Plaintiff filed the instant Motion to Vacate on January 12, 2015, “asking that all
judgments issued by this [C]ourt be vacated pursuant to [Federal Rule of Civil Procedure]
60(b)(4) because [the Court] lacked jurisdiction after the [f]ederal question providing jurisdiction
under 28 U.S.C. § 1331 was dismissed.” Mot. to Vacate 1. Defendants filed their Response in
Opposition to Plaintiff’s Motion to Vacate All Judgments for Lack of Jurisdiction Pursuant to
FRCP 60(b) (“Response”), ECF No. 112, on January 20, 2015.
Federal Rule of Civil Procedure 60(b)(4) provides that “[o]n motion and just terms, the
court may relieve a party or its legal representative from a final judgment, order, or proceeding
[if] . . . the judgment is void.” Fed. R. Civ. P. 60(b)(4). “‘A judgment is void only if the court
that rendered it lacked jurisdiction of the subject matter, or of the parties, or it acted in a manner
inconsistent with due process of law.’” Franklin v. Laughlin, 442 F. App’x 177, 178 (5th Cir.
2011) (quoting Carter v. Fenner, 136 F.3d 1000, 1006 (5th Cir. 1998)).
Plaintiff asserts that the Court lost jurisdiction over Plaintiff’s state law claims when, on
January 5, 2012, the Court dismissed Plaintiff’s federal civil RICO claim, upon which the
Court’s jurisdiction was initially based. Mot. to Vacate 3. Therefore, according to Plaintiff, the
Court’s subsequent decisions relating to the remaining state law claims are void because the
Court lacked jurisdiction to reach them. Id. Defendants respond that the dismissal of Plaintiff’s
federal claim did not deprive the Court of jurisdiction because the Court retained valid pendent
jurisdiction over Plaintiff’s state law claims. Resp. 5.
“[A] district court has discretionary power to adjudicate pendent [state] claims after it has
dismissed the federal claims that originally invoked its jurisdiction.” Cinel v. Connick, 15 F.3d
1338, 1344 (5th Cir. 1994) (citing United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 725-26
(1966)); see also 28 U.S.C. § 1367. “The federal claim must have substance sufficient to confer
subject matter jurisdiction on the court” and “[t]he state and federal claims must derive from a
common nucleus of operative fact.” United Mine Workers, 383 U.S. at 725. This power “need
not be exercised in every case in which it is found to exist.” Id. at 726. “The district court may
decline to exercise [pendent] jurisdiction over a claim . . . if (1) the claim raises a novel or
complex issue of State law, (2) the claim substantially predominates over the claim or claims
over which the district court has original jurisdiction, (3) the district court has dismissed all
claims over which it has original jurisdiction, or (4) in exceptional circumstances, there are other
compelling reasons for declining jurisdiction.” 28 U.S.C. § 1367(c). Courts additionally
consider the common law factors of “‘judicial economy, convenience, fairness, and comity’” in
deciding whether to exercise pendent jurisdiction. See Hicks v. Austin Indep. Sch. Dist., 564 F.
App’x 747, 748 (5th Cir. 2014) (quoting Brookshire Bros. Holding, Inc. v. Dayco Prods., Inc.,
554 F.3d 595, 601-02 (5th Cir. 2009)); Donahue v. Tokyo Electron Am., Inc., 42 F. Supp. 3d 829,
840 (W.D. Tex. 2014).
Plaintiff’s own Motion to Vacate acknowledges that the “[C]ourt initially had
jurisdiction” under 28 U.S.C. § 1331 “because there were questions concerning the laws of the
United States.” Mot. to Vacate 2. Accordingly, there is no dispute that Plaintiff’s initial federal
claim had “substance sufficient to confer subject matter jurisdiction on the [C]ourt.” United
Mine Workers, 383 U.S. at 725. After the Court dismissed Plaintiff’s federal civil RICO claim,
only Plaintiff’s causes of action sounding in state law remained. See Am. Compl. These state
tort claims arose, however, from the same “common nucleus of operative fact” as the federal
civil RICO claim, namely, Defendants’ allegedly fraudulent and tortious conduct relating to the
handling of Plaintiff’s mortgage. See United Mine Workers, 383 U.S. at 725; Am. Compl. 9-15
(“repeat[ing] and re-alleg[ing]” the same set of facts for each federal and state cause of action).
Consequently, the Court had the discretion to retain pendent jurisdiction over Plaintiff’s
remaining state claims. See Connick, 15 F.3d at 1344.
Furthermore, none of the common law or statutory factors considered by courts weighed
in favor of declining jurisdiction. See 28 U.S.C. § 1367(c); Hicks, 564 F. App’x at 748. First,
the judicial economy of both the federal and state courts was served by retaining jurisdiction.
The Motion for Summary Judgment and the Motion to Dismiss were filed shortly after the Court
dismissed Plaintiff’s federal claim. See Mot. for Summ. J. (filed thirteen days after dismissal of
Plaintiff’s civil RICO claim); Mot. to Dismiss (filed nineteen days after dismissal of Plaintiff’s
civil RICO claim). Plaintiff then sought, and received, an extension of time by which to respond
to Defendants’ motions. See Mot. for Time Extension to Respond to Defs.’ Reqs. for Dismissal,
ECF No. 64; Feb. 17, 2012, Order (granting Plaintiff until March 9, 2012, to respond).
Accordingly, it was not until nearly two months after Defendants filed their motions that Plaintiff
responded. See Pl.’s Resp. to Def.’s Mot. for Summ. J. (“Response to Motion for Summary
Judgment”), ECF No. 72; Pl.’s Resp. to Def. Barret Daffin Frappier Turner & Engel, LLP’s Mot.
to Dismiss Pursuant to Fed. R. of Civ. P. 12(c) (“Response to Motion to Dismiss”), ECF No. 73.
Despite the extension on her time to respond, Plaintiff at no point challenged the Court’s
jurisdiction over the state law claims. To the contrary, Plaintiff affirmatively asserted, albeit
incorrectly, that there were remaining federal causes of action in the Case. Compare Resp. to
Mot. for Summ. J. 5 (“Plaintiff[‘s] Amended Complaint includes requests that this Court enter
judgment based on violations of the Truth in Lending Act (‘TILA’) [and] the Federal Real Estate
Settlement Procedures Act (‘RESPA’).”), and Resp. to Mot. to Dismiss 5 (same), with Am.
Compl. 9-15 (asserting only a single federal cause of action), and Jan. 5, 2012, Order (dismissing
Plaintiff’s federal cause of action).
Accordingly, on May 11, 2012, the Court decided the merits of Plaintiff’s state law
claims. See May 11, 2012, Order. At that time the Case had been pending before the Court for
almost two years, the parties’ discovery deadline had passed, and the Case was only three
months before trial. See Compl.; Scheduling Order, ECF No. 47 (setting March 30, 2012,
discovery deadline and August 31, 2012, trial date). Refusing to retain jurisdiction over the state
law claims at that time would not have served the judicial economies of either the federal or state
courts. Compare Doddy v. Oxy USA, Inc., 101 F.3d 448, 456 (5th Cir. 1996) (finding district
court did not abuse discretion by retaining pendent jurisdiction where the case had been pending
for two years, was one month away from trial, and the parties had already conducted extensive
discovery), with Parker & Parsley Petroleum Co. v. Dresser Indus., 972 F.2d 580, 587 (5th Cir.
1992) (finding judicial economy would have been better served by refusing pendent jurisdiction
where case had been pending for only nine months, discovery had not been completed, and the
parties were not ready for trial).
The Court further notes that deciding Plaintiff’s state law claims was neither novel nor
complex. See 28 U.S.C. § 1367(c)(1). Plaintiff’s claims for fraud and intentional infliction of
emotional distress failed because Plaintiff presented no evidence at all in support of her claims.
See May 11, 2012, Order 13-14. Plaintiff’s request for declaratory judgment likewise failed
because Plaintiff “ha[d] no evidence or legal authority” in support of her assertion that Defendant
Wells Fargo could not enforce the mortgage note. Id. at 11. Similarly, Plaintiff’s claim for
wrongful foreclosure “failed as a matter of law” because “it [was] undisputed that no foreclosure
ha[d] taken place.” Id. at 12. Accordingly, “while the matters remaining in [the] lawsuit [were]
solely questions of state law, they present[ed] no novel or especially unusual questions which
[could not] be readily and routinely resolved by the [C]ourt.” See Newport Ltd. v. Sears,
Roebuck & Co., 941 F.2d 302, 308 (5th Cir. 1991). Therefore, considerations of comity to the
State courts did not weigh against exercising pendent jurisdiction over Plaintiff’s state law
claims. See id.
Finally, the Court finds that neither considerations of fairness or convenience weighed in
favor of declining jurisdiction over the state claims. Even after the Court dismissed Plaintiff’s
federal claim, the Court granted Plaintiff an extension of time by which to respond to
Defendants’ dispositive motions on the remaining state claims. See Feb. 17, 2012, Order.
Nonetheless, after nearly two years of litigation, Plaintiff was unable to present any evidence in
support of her claims. See May 11, 2012, Order 7-14. Plaintiff has offered no reason why the
Court’s retention of jurisdiction was in anyway unfair to her ability to pursue her claim. Nor has
Plaintiff offered any reason why it would have been convenient for any party if the Court had
declined jurisdiction and required Plaintiff to re-file her claims in the State courts.
Accordingly, the Court properly exercised pendent subject matter jurisdiction over
Plaintiff’s state law claims. See Doddy, 101 F.3d at 456; Connick, 15 F.3d at 1344; Newport,
941 F.2d at 308. The Court’s judgments in the Case are, therefore, not void within the meaning
of Federal Rule of Civil Procedure 60(b)(4), and Plaintiff is not entitled to the relief sought. See
Franklin, 442 F. App’x at 178.
It is therefore ORDERED that Plaintiff’s Motion to Vacate, ECF No. 111, is DENIED.
SIGNED this 25th day of March, 2015.
UNITED STATES DISTRICT JUDGE
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