Branch Banking & Trust Co. v. Okay
| Decision Date | 23 August 2016 |
| Docket Number | 1:16cv555(JCC/JFA) |
| Court | U.S. District Court — Eastern District of Virginia |
| Parties | BRANCH BANKING & TRUST CO., Plaintiff, v. CHRISTOPHER M. OKAY, Defendant. |
This matter is now before the Court on Defendant Christopher M. Okay's ("Defendant" or "Okay") Motion to Dismiss for Improper Venue, or in the Alternative, Transfer the Action1 [Dkt. 2], and Plaintiff Branch Banking and Trust Company's ("Plaintiff" or "BB&T") Motion to Remand [Dkt. 6]. For the following reasons, the Court denies Defendant's Motion to Dismiss for Improper Venue, denies Plaintiff's Motion to Remand, grants Defendant's Motion to Transfer, and transfers the action to the Western District of Virginia, Harrisonburg Division.
At the motion to dismiss stage, the Court must read the complaint as a whole, construe the complaint in a light most favorable to the plaintiff, and accept the facts alleged in the complaint as true. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
The following facts, taken from Plaintiff's Complaint [Dkt. 1-4], Plaintiff's Amended Complaint [Dkt. 11], Defendant's Notice of Removal [Dkt. 1], and the parties' briefs are taken as admitted only for purposes of the motions now before the court.
On or about August 22, 2007, Defendant and Former Defendant Priscilla M. Okay submitted a retail loan application seeking a line of credit from Plaintiff in the amount of $101,000.00. (Compl., ¶ 4.) Plaintiff is a banking corporation with its principle offices in Winston-Salem, North Carolina. (Notice of Removal, ¶ 12.) The Application was approved and Plaintiff granted Defendant and Priscilla M. Okay a line of credit with the maximum credit limit of $101,000.00. (Compl. at ¶ 5.) This loan is evidenced by a BB&T Tax Advantage Credit Line Agreement and Initial Disclosure Statement (the "Tax Advantage Credit Line"). (Id. at ¶ 6.) At the time the parties entered into the Tax Advantage Credit Line, Defendant was employed by Plaintiff as an attorney at its corporate headquarters in Winston-Salem, North Carolina. (Def.'s Mem. in Supp. [Dkt. 3], at 2.) The loan was secured by a security interest in real property and improvements at 216 Hollow Tree Court, Winston-Salem, North Carolina 27127 (the "Hollow Tree Property") for the benefit of Plaintiff. (Compl., ¶ 8.) Plaintiff's security interest was recorded among the Land Records of Davidson County, North Carolina as a Deed of Trust. (Id.)
By October 14, 2014, Defendant had entered into default on the Tax Advantage Line of Credit and Plaintiff notified him that failure to cure the default could result in acceleration of the entire balance due. (Id. at ¶ 10.) On April 1, 2015, Plaintiff notified Defendant that it had elected not to pursue foreclosure and would be releasing the lien on the Hollow Tree Property, but would not be releasing Defendant from his liability on any amounts due and owing under the Tax Advantage Line of Credit. (Id. at ¶ 11.)
On August 19, 2015, Plaintiff filed this suit against Defendant and Former Defendant Priscilla Okay in the Circuit Court for Arlington County, Virginia seeking the outstanding balance under the Tax Advantage Line of Credit, prior accrued interest, and reasonable attorney's fees as provided for by the Tax Advantage Line of Credit. (Id., ¶ 15.) On or about October 9, 2015, Plaintiff settled its claim against Former Defendant Priscilla Okay for the sum of $25,000.00. (Am. Compl., ¶ 15.) Defendant was not served with this lawsuit until April 18, 2016. (Notice of Removal, ¶ 4.) When the lawsuit was filed, and when Defendant received service of process, he lived in Staunton, Virginia. (Id.)
On May 18, 2016, Defendant removed the action to this Court from the Circuit Court for Arlington County pursuant to 28 U.S.C. §§ 1332(a), 1441, and 1446. (Id.) Defendant then filed his Motion to Dismiss for Improper Venue or in the Alternative, Transfer the Action on May 25, 2016. Defendant noticed a hearing on his Motion for August 4, 2016. Plaintiff has not filed any opposition to Defendant's Motion. Plaintiff did, however, file a Motion to Remand on June 23, 2016. (Pl.'s Mot. to Remand [Dkt. 6].) Defendant filed his Opposition to Plaintiff's Motion to Remand on July 5, 2016. At the August 4, 2016 hearing the Court addressed both Defendant's Motion to Dismiss for Improper Venue or, in the Alternative, Transfer the Action and Plaintiff's Motion to Remand. Both Motions are now ripe for decision.
Plaintiff moves to remand this action back to the Circuit Court for Arlington County pursuant to Federal Rule of Civil Procedure 15(a) and 28 U.S.C. § 1447(c).
Civil actions over which a federal court would have original jurisdiction can be removed by the defendant from state court to the appropriate federal district court pursuant to 28 U.S.C. § 1441. The party seeking removal bears the burden of establishing federal jurisdiction. See Mulcahey v. Columbia Organic Chem. Co., 29 F.3d 148, 151 (4th Cir. 1994)(citing Wilson v. Republic Iron & Steel Co., 257 U.S. 92, 97 (1921)). "If federal jurisdiction is doubtful, a remand is necessary." Id. (citations omitted).
Federal courts have original jurisdiction over civil actions between citizens of different States provided that "the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs . . . ." 28 U.S.C. § 1332(a). When determining the amount in controversy for purposes of diversity jurisdiction, courts must look to the complaint as it existed at the time of removal. See St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 292 (1938); Alabama Great S. Ry. Co. v. Thompson 200 U.S. 206, 215 (1906). The court looks to the amount asserted in good faith in the plaintiff's complaint at the time of removal, and will only question this number where "it appears to a legal certainty that the plaintiff cannot recover the jurisdictional amount." McDonald v. Patton, 240 F.2d 424, 426 (4th Cir. 1957). The legal impossibility must be "so certain as virtually to negative the plaintiff's good faith in asserting the claim." Wiggins v. N. Am. Equitable Life Assurance Co., 644 F.2d 1014, 1017 (4th Cir. 1981)(quoting St. Paul Mercury Indemnity Co., 240 F.2d at 426).
Although attorney's fees are generally not included in the amount in controversy calculation, "courts have created two exceptions to this rule: '(1) if the fees are provided for by contract; or (2) if a statute mandates or allows payment of attorney's fees.'" Francis v. Allstate Ins. Co., 709 F.3d 362, 368 (4th Cir. 2013)(quoting 15-102 Moore's Federal Practice, Civil § 102.106(6)(a)).
Federal Rule of Civil Procedure 12(b)(3) permits the defendant to challenge the plaintiff's choice of venue in a pre-answer motion. When a defendant challenges venue, the plaintiff bears the burden of establishing that venue is proper. T. and B. Equip. Co., Inc. v. RI, Inc., No. 3:15-cv-337, 2015 WL 5013875, at *2 (E.D. Va. Aug. 24, 2015). "[I]f no evidentiary hearing is held, 'the plaintiff need only make a prima facie showing of venue.'" Id. (quoting Mitrano v. Hawes, 377 F.3d 402, 405 (4th Cir. 2004)). Id. (citations omitted).
When a plaintiff brings a case in an improper venue, the district court may dismiss the action or transfer it "to any district in which it could have been brought" if such transfer is "in the interest of justice." 28 U.S.C. § 1406(a).
When an action is removed from state court to federal court, § 1441(a) expressly provides that the proper venue of a removed action is "the district court of the United States for the district and division embracing the place where such action is pending." Polizzi v. Cowles Magazines, Inc., 345 U.S. 663, 666 (1953)(quoting 28 U.S.C. § 1441(a)).
Where venue is proper, but convenience and the interests of justice impel the use of either another proper venue in which the action "might have been brought" or a "district or division to which all parties have consented," the court may transfer the case to that district and division pursuant to 28 U.S.C. § 1404(a). See Brock v. Entre Computer Ctrs., Inc., 933 F.2d 1253, 1257 (4th Cir. 1991).
As a challenge to the exercise of this Court's subject matter jurisdiction, the Court must first resolve Plaintiff's Motion to Remand before turning to Defendant's Motion to Dismiss for Improper Venue and then, finally, to Defendant's Alternative Motion to Transfer Pursuant to 28 U.S.C. § 1404(a).
Plaintiff moves to remand this action on the grounds that the amount in controversy is now below the $75,000 jurisdictional floor established by 28 U.S.C. § 1332(a).2 Plaintiff argues that because "prior to the removal of this action to this Court, Plaintiff settled with former Defendant Priscilla Okay for $25,000," the principal balance now in controversy in this action is "$65,881.34, an amount less than the $75,000 jurisdictional amount." (Pl.'s Mem. in Supp. [Dkt. 5-2] at 1.) While Plaintiff admits that its Complaint did not reflect this settlement at the time of removal, it has since amended its complaint to reflect that it now only seeks "$65,881.34, plus prior accrued interest of $1,723.64, plus costs and reasonable attorney fees." (Am. Compl. [Dkt. 11], ¶ 17). The Amended Complaint further notes that the Tax Advantage Credit Line provides that in the event of default, Defendant is responsible for "reasonable attorney fees of 15% of the outstanding balance." (Id.)
Plaintiff is essentially arguing that its Amended Complaint destroys this court's jurisdiction by reducing the amount in controversy to below the jurisdictional floor of $75,000. It is well settled law,...
To continue reading
Request your trial