Discover Bank v. McGraw

Filing 9

MEMORANDUM OPINION AND ORDER The 8 Brief in Opposition is OVERRULED; the 7 Proposed Findings & Recommendation is ADOPTED in full; directing that this matter is REMANDED the Circuit Court of Jackson County, West Virginia. Signed by Senior Judge John T. Copenhaver, Jr. on 6/3/2024. (cc: counsel of record; any unrepresented parties) (kew)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF WEST VIRGINIA
AT CHARLESTON
DISCOVER BANK,
Plaintiff,
v.

Civil Action No. 2:24-cv-00127

LINDA M. MCGRAW,
Defendants.
MEMORANDUM OPINION AND ORDER
Pending are defendant’s objections, ECF No. 8 (“Obj.”)
to the Magistrate Judge’s Proposed Findings and Recommendation,
ECF No. 7 (“PF&R”).
I. Factual and Procedural Background
Plaintiff Discover Bank (hereinafter “plaintiff” or
“Discover”) originally filed this action in the Circuit Court of
Jackson County, West Virginia, on February 7, 2024.
2-1 at 2 (Complaint) (hereinafter, “Compl.”).

See ECF No.

Plaintiff alleges

that defendant Linda M. McGraw is indebted to plaintiff in the
amount of $9,178.21, and plaintiff has expressly waived postjudgment interest and court costs.

Id.

The complaint does not

cite to or assert any claims under federal law.

See id.

Defendant was served on February 9, 2024.

Notice of Removal

¶ 2, ECF No. 2.
On March 15, 2024, defendant filed a Notice of Removal
in which she asserts that the court “has original jurisdiction
under 28 U.S.C. § 1331” and that removal is proper under 28
U.S.C. § 1441(a).

Notice of Removal, ¶ 4.

Nonetheless,

defendant notes therein that “[t]here is no mention of any
[f]ederal statutes or precedents within the [c]omplaint.”
at ¶ 2.

Id.

The “Civil Cover Sheet” which defendant filed

contemporaneously with the Notice of Removal describes the cause
of action as “[b]reach of contract.”

ECF No. 2-2 (Civil Cover

Sheet).
Defendant asserts both in the Civil Cover Sheet and
Notice of Removal that the court has original jurisdiction under
28 U.S.C. § 1331.

Notice of Removal at ¶ 4; ECF No. 2-2.

Notice of Removal asserts:
[This civil action] arises under 15 u.s.c. §
1681g, 15 u.s.c. § 44, 15 U.S.C. § 1679a, 15
U.S.C. § 1692a(2), (5) and (6), 15 U.S.C. §
1692a(3), 15 U.S.C. § 1692a (6), 15 U.S.C. §
1692b(2), 15 U.S.C. § 1692c(c), 15 U.S.C. §
1692c(c)(2), 15 U.S.C. § 1692j, 15 U.S.C. §
6827(4)(B), 18 U.S.C. §1461, 15 USC §1601,
15 USC §1692, 15 U.S.C.S. § 1601-1667c, 12
CFR §226.1, Federal Rule of Civil Procedure
17(a)(I), UCC 3-104(3)(b), UCC 3-106, UCC 3302, UCC 3-603, and finally, Article I,
Section 10, Clause I of the Constitution for
the [U]nited States of America (1782).
2

The

Given the mention of having "access to a
system of records maintained by the United
States Department of Defense," makes this a
Federal matter.
Notice of Removal ¶ 4.

Defendant concludes with the conclusory

statement that “[a]ll of the aforementioned reasons raise
[f]ederal questions.”

Id.

Magistrate Judge Dwane L. Tinsley issued his proposed
findings and recommendations on April 16, 2024.

The Magistrate

Judge finds that the court must sua sponte remand this matter
because “it is clear from the record that this [c]ourt lacks
subject-matter jurisdiction over” this action under either 28
U.S.C. § 1331 or § 1332.
1447(c)).

PF&R at 3-4 (citing 28 U.S.C. §

First, the Magistrate Judge finds that this action

“does not ‘arise under’ federal law in accordance with § 1331,”
inasmuch as this is a breach of contract case arising under
state law.

Id. at 3-5.
Second, the Magistrate Judges finds that the court

also does not possess subject matter jurisdiction under 28
U.S.C. § 1332 because the amount in controversy, $9,178.21,
falls far short of the $75,000 minimum to satisfy the statutory
requirement.

PF&R at 7; see Lottig v. Haley, 3:23-cv-603, 2023

WL 8295978, at *2 (S.D.W. Va. Dec. 1, 2023) (finding the amount
in controversy requirement unsatisfied where plaintiff
“specifically request[ed] $12,379.76 in damages”).
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On May 1, 2024, defendant filed objections to the
PF&R.

See Defendants’ Brief in Opposition to Remand, ECF No. 8

(hereinafter, “Obj.”).

Though not styled as an objection to the

PF&R, defendant’s “Brief in Opposition to Remand” is directed to
the PF&R and the court interprets it as objections thereto.
II. Legal Standard
Under Federal Rule of Civil Procedure 72(b), “a party
may serve and file specific written objections to the proposed
findings and recommendations.”

Fed. R. Civ. P. 72(b).

A

district judge “must determine de novo any part of the
magistrate judge’s disposition that has been properly objected
to.”

Id.

In particular, “a general objection . . . is

insufficient to avoid waiver.”

Page v. Lee, 337 F.3d 411, 416

n.3 (4th Cir. 2003) (noting also that “other circuits have held
that the failure to raise an objection sufficiently specific to
focus the district court's attention on the factual and legal
issues that are truly in dispute waives any appellate review”
(quotation marks omitted)).

See also Howard v. Sec’y of Health

& Human Servs., 932 F.2d 505, 508–09 (6th Cir. 1991); Lockert v.
Faulkner, 843 F.2d 1015, 1019 (7th Cir. 1988).
Additionally, the court is instructed to liberally
construe pro se pleadings.

See Estelle v. Gamble, 429 U.S. 97,

106 (1976); Loe v. Armistead, 582 F.2d 1291, 1295 (4th Cir.
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1978).

Such liberal construction does not mean, however, that

the court can ignore a failure to allege facts setting forth a
cognizable claim for relief.

See Weller v. Dep't of Social

Servs., 901 F.2d 387, 391 (4th Cir. 1990).

Further, “[t]he

‘special judicial solicitude’ with which a district court should
view pro se complaints does not transform the court into an
advocate.”

Id.
III. Defendant’s Objections
Defendant structured her objections by providing four

“Questions Presented,” which the court understands to establish
four general objections to the PF&R and will address each in
turn.

Those four objections, stated verbatim, are as follows:
1. Given the jurisdiction of the District
Court is for "all civil actions arising
under the Constitution, laws, or treaties
of the United States", does not
mentioning of any laws, codes, treaties
or regulations of the United States
within the complaint preemptively
disqualify any filing for a removal under
28 USC 1331?
2. Given the answer to Question 1,
therefore, why does it disqualify any
later removal under 28 USC 1331 when a
removal is submitted which mentions
"access to a system of records maintained
by the United States"?
3. According to the Analysis, the court
states the amount required of Removal is
set by Congress in 28 USC 1332. The court
also states this case doesn't meet that
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requirement. What is the legal definition
of a US dollar which is what the
presumption of value is based on?
4. The court mentions "Plaintiffs commonlaw complaint" in the Analysis which
assumes and presumes there is a common
law contract. However, given the
parameters of such contract, does one
actually exist? And if one does not
exist, how does this fact affect this
case? Can there be a Breach of Contract
when a contract does not exist or is of a
legal means?
Obj. at 2-3.
a.

First Objection

Defendant’s first objection is, in essence, an
objection to the PF&R’s conclusion the court does not have
federal question jurisdiction, see 28 U.S.C. § 1331, over this
matter.

The objection seems to center on an argument that,

because West Virginia is a state within the United States, a
case arising under state law necessarily also had a “federal
ingredient” and thus arises under federal law.

See Obj. 3-4

(citing to Osborn v. Bank of U.S., 22 U.S. 738, 6 L. Ed. 204
(1824), though the phrase “federal ingredient” never appears
therein).
Federal courts are fundamentally “courts of limited
jurisdiction” and may only exercise subject matter jurisdiction
pursuant to authority under Article III of the Constitution and

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by federal statute.

See Owen Equip. & Erection Co. v. Kroger,

437 U.S. 365, 374 (1978).

In order for jurisdiction to arise

under 28 U.S.C. § 1331, a disputed issue of federal law must be
a ”necessary element of one of the [plaintiff’s] well-pleaded
claims.”

Anne Arundel Cnty., Maryland v. BP P.L.C., 94 F.4th

343, 351 (4th Cir. 2024) (citing Burrell v. Bayer Corp., 918
F.3d 372, 381 (4th Cir. 2019)).

After removal from state court,

“[i]f at any time before final judgment it appears that the
district court lacks subject matter jurisdiction, the case shall
be remanded.”

28 U.S.C. § 1447(c).

Here, state law is the basis of plaintiff’s cause of
action.

As defendant acknowledges in her filings by

recognizing that “[t]here is no mention of any [f]ederal
statutes or precedents within the [c]omplaint,” the breach of
contract claim in this case is a matter of state law, not
federal law.

Notice of Removal at 2; see Interstate Petroleum

Corp. v. Morgan, 249 F.3d 215, 221-222 (4th Cir. 2001) (finding
breach of contract claim is one only of state law even where
anticipated defense necessarily implicates federal law).
Further, defendant’s conclusory recitation of federal
statutes does not establish “arising under” jurisdiction because
“a claim of federal question jurisdiction is to be resolved on
the basis of the allegations of the complaint itself.”

7

Burgess

v. Charlottesville Sav. And Loan Assoc., 477 F.2d 40, 43 (4th
Cir. 1973); see also Mayor & City Council of Baltimore v. BP
P.L.C., 31 F.4th 178, 198 (4th Cir. 2022), cert. denied, 143 S.
Ct. 1795, 215 L. Ed. 2d 678 (2023) (“The general rule, of
course, is that a plaintiff is the ‘master of the claim,’ and he
may ‘avoid federal jurisdiction by exclusive reliance on state
law’ in drafting his complaint.”) (quoting Pinney v. Nokia,
Inc., 402 F.3d 430, 442 (4th Cir. 2005)).
Accordingly, defendant’s first objection is OVERRULED.

b.

Second Objection

Defendant’s second objection again appears to be an
objection to the PF&R’s conclusion that federal question
jurisdiction under 28 U.S.C. § 1331 does not exist in this
action.

See Obj. 5-6.

Seemingly, defendant appears to object

to that conclusion inasmuch as the words “‘access to a system of
records maintained by the United States’ was a statement in an
Affidavit entered as an exhibit.”

Obj. at 5.

The exhibit to which defendant refers appears to be an
affidavit by Lori Snyder, a “Litigation Support Coordinator” for
plaintiff, who stated, in relevant part, that plaintiff “has
access to a system of records maintained by the United States

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Department of Defense which allows [plaintiff] to ascertain
whether a particular person in engaged in active duty in any
branch of the [United States] military.”

Affidavit of Lori

Snyder, ECF No. 2-1 at 20 (originally filed as an exhibit to
plaintiff’s motion for summary judgment in state court).
Jurisdiction under 28 U.S.C. § 1331 arises only where
the well-pleaded allegations in the complaint establish a cause
of action that “aris[es] under the Constitution, laws, or
treaties of the United States.”

28 U.S.C. § 1331; see Anne

Arundel Cty., Maryland, 94 F.4th at 351.

Accordingly, a

reference to a federally maintained system of records in an
affidavit supporting a motion for summary judgment is
insufficient to establish federal question jurisdiction.
Defendant’s second objection is OVERRULED.

c.

Third Objection

In defendant’s third objection, she acknowledges that
the PF&R “states this case doesn’t meet” the amount in
controversy requirement of 28 U.S.C. § 1332.

Obj. at 6.

Her

objection then asks, “What is the legal definition of a US
dollar which is what presumption of value is based on?”
2, 6-7.

Obj. at

When expanding on this objection, defendant further

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asks, “And if it not based on the US Dollar, what is the value
based on?”

Obj. at 7.
Inasmuch as this objection lacks specificity because

it does not “focus the district court’s attention on the factual
and legal issues that are truly in dispute,” the court need not
directly address it.

Lee, 337 F.3d at 416 n.3 (citing Fed. R.

Civ. P. 72(b) (requiring that objections, if filed, be
“specific”)).

The debt allegedly owed by defendant is in United

States dollars.

Defendant’s third objection is OVERRULED.

d.

Fourth Objection

Defendant’s fourth objection is not particularly an
objection at all.

Rather, it asks the court to reach the merits

of this matter: it challenges the underlying breach of contract
claim by arguing that there may not be a contract at all.
Obj. 9-15.

Its heading states:
The court mentions "Plaintiff's common-law
complaint" in the Analysis which assumes and
presumes there is a common law contract.
However,
given
the
parameters
of
such
contract, does one actually exist? And if one
does not exist, how does this fact affect this
case? Can there be a Breach of Contract when
a contract does not exist or is of a legal
means?

Obj. at 9.
10

See

Because the court has determined it does not have
subject matter jurisdiction over this matter, the court cannot
reach its merits and determine whether a contract between
plaintiff and defendant exists.

See Fed. R. Civ. P. 12(h)(3).

Inasmuch as this objection objects to the PF&R’s decision to not
reach the merits of this matter, defendant’s fourth objection is
OVERRULED.

IV. Portions of the PF&R to which Defendant did not Object
When a party does not object to a portion of a
Magistrate Judge’s report, the court must nonetheless review the
report to ensure, based upon the record, that it contains no
clear error.
1983).

See Camby v. Davis, 718 F.2d 198, 200 (4th Cir.

Having reviewed the PF&R in its entirety, the court

finds no clear error.
V.

Conclusion

Regardless of whether the court understands the
objections made by the defendant – obscure as they are – it is
obvious that this court has neither federal question nor
diversity jurisdiction over this case.

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For the foregoing reasons, the court OVERRULES each of
defendant’s objections to the PF&R and ADOPTS Magistrate Judge
Tinsley’s PF&R in full.
Pursuant to 28 U.S.C. § 1447(c), the court ORDERS that
this matter be REMANDED to the Circuit Court of Jackson County,
West Virginia.
The Clerk is directed to transmit copies of this order
to all counsel of record and any unrepresented parties.
ENTER: June 3, 2024

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