Settle et al v. OneWest Bank, FSB

Filing 27

MEMORANDUM OPINION AND REMAND ORDER: granting Plaintiffs' 7 MOTION to Remand to Circuit Court; remanding this case to the Circuit Court of Raleigh County for further proceedings. Signed by Judge Irene C. Berger on 7/25/2011. (cc: attys; any unrepresented party; Raleigh County Circuit Clerk) (slr)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA
BECKLEY DIVISION

OVERTON E. SETTLE and
LOEWANNA K. SETTLE,
Plaintiffs,
v.

CIVIL ACTION NO. 5:11-cv-00063

ONE WEST BANK, FSB,
Defendant.

MEMORANDUM OPINION AND REMAND ORDER
The above-styled case is before this Court for consideration of Plaintiffs’ Motion to Remand
(Document No.7), wherein Plaintiffs argue that this Court lacks subject matter jurisdiction in this
case because the requisite jurisdictional amount in controversy, pursuant to 28 U.S.C. § 1332, has
not been satisfied.1 Plaintiffs contend that they have sufficiently limited their recovery in this
litigation to $74,999.99 in a binding stipulation filed contemporaneously with their Complaint.2

1

Plaintiffs initially filed their Complaint in the Circuit Court of Raleigh County on December 13, 2010,
alleging that One West Bank, mortgage loan servicer, (1) assessed illegal charges on their mortgage loan in violation
of West Virginia Code §§ 46A-2-127(g) - 128(c) and threatened to add fees and charges in violation of West Virginia
Code §§ 46A-2-127(g) - 124(f); and (2) failed to provide an account history upon Plaintiffs’ written request in violation
of West Virginia Code § 46A-2-114(2). Plaintiffs seek actual damages, declaratory judgment that Defendant is charging
unauthorized charges, injunctive relief to enjoin the illegal practice, civil statutory penalties of $4,400 for each violation,
and attorney fees. (See Mem. of Law in Support of Plaintiffs’ Motion to Remand (Document No. 8) at 1-3; Notice of
Removal, Ex. A, Complaint (Document No. 1-1)). Defendant removed this matter to this Court on January 26, 2011
(Notice of Removal (Document No. 1).
2

The Stipulation states:
(1) The Plaintiffs stipulate that all of their alleged damages set forth in the Complaint are no greater
than $75,000, inclusive of attorney’s fees and court costs.
(2) To the extent any award of the Court and/or jury, inclusive of attorney fees, would be in excess
of a combined $75,000.00, the Plaintiffs stipulate that they will not be entitled to recover said excess.

(continued...)

Defendant, in opposition, contends that the stipulation is not binding because it does not limit
Plaintiffs’ claim for declaratory and injunctive relief and because their Complaint does not contain
a sum certain prayer for relief. In lieu of a binding stipulation, Defendant contends that the amount
in controversy is met upon consideration of the statutory penalties that Plaintiffs seek, attorneys fees
and the value of any injunctive relief.
The Court held a hearing on the motion on July 21, 2011, during which the parties clarified
their positions on the issue of whether Plaintiffs’ stipulation limiting the amount in controversy was
sufficient to prevent Defendant’s removal of the matter to this Court. During the hearing, Plaintiffs
maintained the position that they have filed a proper stipulation that limits their recovery for all of
the relief sought. Plaintiffs argue that any value of injunctive relief sought, that is, for Defendant to
stop assessing inappropriate or illegal fees on their account, is encompassed in any award amount
limited to $74,999.99.3
Defendant persisted in its argument that the stipulation is insufficient to account for
injunctive relief. Defendant argued that Plaintiffs cannot place a cap on the value of any award of
injunctive relief and that the Court must consider the value of the injunctive relief to Defendant in
any determination of the amount in controversy. In support of its argument, Defendant cited
GreenEarth Cleaning, LLC v. Collidoue Invest France, No.09-0329, 2009 U.S. Dis. LEXIS 53046
(W.D. Mo. Jun. 23, 2009). GreenEarth and Collidoue entered into a license agreement permitting

2

(...continued)

(Notice of Removal, Ex. A., Stipulation (Document No. 1-1.)) There is no dispute that the stipulation is signed by
Plaintiffs and their attorney, notarized, and filed contemporaneous with the Complaint. Additionally, the Complaint
contains a similar statement (Complaint at 1.)
3

Plaintiffs contended that if the Court were to find, as a result of this litigation, that the fees were illegal,
Defendant would have no pecuniary interest in any injunctive relief enjoining it from assessing illegal fees.

2

Collidoue to use GreenEarth’s patented dry-cleaning process with its trademarked name and logo
in France. A dispute later arose with respect to whether Collidoue wrongfully induced GreenEarth
into executing an exclusive license agreement, rather than a non-exclusive agreement. The Western
District of Missouri found that a stipulation, purporting to limit GreenEarth’s recovery to $74,999,
filed after removal (unlike the Plaintiffs’ Stipulation here), was insufficient to preclude removal.
The district court considered that the contract at issue (attached to the petition) provided that
GreenEarth offered to license its technology for an amount exceeding $75,000. Based on that
contract, the Court found that even if GreenEarth’s damages were capped at $74,999, the amount
in controversy is still greater than $75,000 considering declaratory and injunctive relief.
An action may be removed from state court to federal court if it is one over which the district
court would have had original jurisdiction. 28 U.S.C. § 1441(a).4 Federal district courts have
original jurisdiction over all civil actions between citizens of different states if the amount in
controversy exceeds $75,000, exclusive of interest and costs. 28 U.S.C. § 1332(a)(1).5 It is the
long-settled principle that the party seeking to adjudicate a matter in federal court, through removal,
carries the burden of alleging in its notice of removal and, if challenged, demonstrating the court’s
jurisdiction over the matter. See Strawn et al. v. AT &T Mobility, LLC et al., 530 F.3d 293, 296 (4th
Cir. 2008) (citations omitted); see also Mulcahey v. Columbia Organic Chems. Co., 29 F.3d 148,

4

Section 1441(a) states in pertinent part:
Except as otherwise expressly provided by Act of Congress, any civil action
brought in a State court of which the district courts of the United States have
original jurisdiction, may be removed by the defendant or the defendants, to
the district court of the United States for the district and division embracing the
place where such action is pending.
28 U.S.C. § 1441(a).

5

The parties do not contest that they are diverse.

3

151 (4th Cir. 1994) (“The burden of establishing federal jurisdiction is placed upon the party seeking
removal.”) (citation omitted). Accordingly, in this case, Defendant has the burden to demonstrate
the existence of federal jurisdiction by a preponderance of the evidence. See White v. Chase Bank
USA, NA., Civil Action No. 2:08-1370, 2009 WL 2762060, at *1 (S.D. W. Va. Aug. 26, 2009)
(Faber, J) (citing McCoy v. Erie Insurance Co., 147 F.Supp. 2d 481,488 (S.D. W. Va. 2001)). A
defendant must furnish evidence in support of the statutory jurisdictional amount. “[A] mere
assertion that the amount in controversy exceeds $75,000.00 is insufficient to meet this burden.”
White, 2009 WL 2762060 at *2. In deciding whether to remand, this Court must “resolve all doubts
about the propriety of removal in favor of retained state jurisdiction.” Hartley v. CSX Transp., Inc.,
187 F.3d 422, 425 (4th Cir. 1999).
There is no dispute with respect to the citizenship of the parties. Thus, Defendant need only
establish that the jurisdictional amount is satisfied. Upon consideration of Defendant’s notice of
removal, Plaintiffs’ motion to remand, the opposition thereto, and the arguments made by counsel
at the hearing, the Court finds that Defendant has not carried its burden. Stipulations may be used
by Plaintiffs to limit the amount in controversy for the purpose of defeating jurisdiction in this Court.
The Stipulation must be “a formal [i.e., signed and notarized], truly binding, pre-removal stipulation
signed by counsel and [his/her] client explicitly limiting recovery. The stipulation should be filed
contemporaneously with the complaint, which also should contain the sum-certain prayer for relief.
McCoy v. Erie Ins. Co., 147 F.Supp. 2d 481, 485-86 (S.D. W. Va. 2001) (Haden, C.J.). Plaintiffs’
stipulation meets this requirement.6 Defendant has not adequately demonstrated otherwise. The
Court finds unpersuasive Defendant’s argument that any award of injunctive relief against

6

(See supra n.2.)

4

Defendant would make the Stipulation ineffective. Moreover, the Court cannot find, and indeed
Defendant has not demonstrated, that any award of injunctive relief would have any value in this
case.7 Particularly, if the litigation concludes with a finding that the fees, the value of which has not
been determined, were wholly appropriate, no award of injunctive relief would be made. Likewise,
if the parties’ litigation ultimately ends in a finding against Defendant, that it is charging illegal or
inappropriate fees, Defendant would have no pecuniary interest in an award precluding its
assessment of those fees. Indeed, the value of the injunctive relief has not been quantified. The
mere inclusion of such a claim of relief does not, in and of itself, satisfy the requisite jurisdictional
amount of $75,000. Therefore, the Court is not persuaded, on the facts known to the Court at the
time of removal, that the injunctive relief sought could be valued, either standing alone or coupled
with other relief, in a manner which would support the requisite jurisdictional amount.
In conclusion, for the reasons stated above, the Court ORDERS that Plaintiffs’ Motion to
Remand (Document No. 7) is GRANTED. The Court REMANDS this case to the Circuit Court
of Raleigh County for further proceedings. The Court DIRECTS the Clerk to send a certified copy
of this Memorandum Opinion and Remand Order to the Circuit Clerk of Raleigh County, West
Virginia, and a copy to counsel of record.
ENTER:

7

July 25, 2011

Consequently, the Court finds Defendant’s reliance on GreenEarth is unavailing as that case is factually
distinguishable.

5