Brogan-Johnson v. Navient Sols.
Decision Date | 06 October 2021 |
Docket Number | Civil Action 5:21-CV-155 |
Court | U.S. District Court — Northern District of West Virginia |
Parties | REBECCA L. BROGAN-JOHNSON, Plaintiff, v. NAVIENT SOLUTIONS, INC., Defendant. |
REBECCA L. BROGAN-JOHNSON, Plaintiff,
v.
NAVIENT SOLUTIONS, INC., Defendant.
Civil Action No. 5:21-CV-155
United States District Court, N.D. West Virginia
October 6, 2021
Judge Bailey
MEMORANDUM OPINION AND ORDER DENYING MOTION TO REMAND
JOHN PRESTON BAILEY UNITED STATES DISTRICT JUDGE
Currently pending before this Court is Plaintiff's Motion to Remand [Doc. 5], filed September 10, 2021. The Motion has been fully briefed and is now ripe for decision. For the reasons that follow, the Court will deny the Motion.
BACKGROUND
This case arises out of a dispute over student loan payments. As set forth in the Amended Complaint, plaintiff incurred student loan debt while pursuing her education at Virginia Tech and later Loyola University School of Law, finishing in May of 2002. [Doc. 1 -4 at ¶ 6]. At some later time, defendant became the student loan servicer for those loans. [Id. at¶ 15]. "The original balance [of the consolidated loans] is listed as $78, 322.89. The annual interest rate on the consolidated loans is 3.0%. The repayment term for the consolidated loans is 30 years under a 'Level Payment Plan.'" [Id. at ¶ 16]. On April 10, 2016, defendant sent a letterto plaintiff indicating that her monthly payment would increase from $307.89 to $328.89; defendant did not provide a reason for the increase. [Id. at
¶¶ 18-20]. On September 5, 2016, plaintiff filed a complaint with the Consumer Financial Protection Bureau; defendant responded that plaintiff's original interest rate is 4% but that she was receiving a 1 % reduction, and that although it calculated payments based on the original rate, it would be willing to recalculate her payment using the discounted rate of 3%. [Id. at ¶ 33]. Nonetheless, defendant continued to bill at the same rate. [Id. at ¶ 34].
On January 17, 2017, plaintiff filed suit in the Circuit Court of Ohio County, West Virginia. See [Doc. 1-1]. Plaintiff alleged three causes of action: first, breach of contract for applying a loan interest rate in excess of the contract interest rate. [Id. at ¶¶ 35-44]. Second, for fraudulent, deceptive, or misleading representations under W.Va. Code § 46A-2-127. [Id. at ¶¶ 45-59]. Third, for unfair or unconscionable debt collection practices in violation of W.Va. Code § 46A-2-128. [Id. at ¶¶ 60-69]. On both of the counts under the West Virginia Consumer Credit and Protection Act ("WVCCPA") plaintiff alleged that each monthly bill received using the incorrect interest rate constituted an additional violation. [Id. at¶¶58 & 69].
In her initial Complaint, plaintiff included a stipulation, signed by herself and by plaintiff's counsel, stating that "she will neither seek nor accept damages in this matter in excess of $75, 000, including any award that may be made for attorneys fees. . . . thus barring removal of this matter on diversity ground as the claim does not meet the jurisdictional threshold." [Id. at 15].
On August 2, 2021, over four and a half years after filing the initial Complaint, plaintiff filed a Motion to Amend the Complaint; the amendment sought to remove the $75, 000 cap on damages. [Doc. 1-2]. The Circuit Court granted the motion. [Doc. 1-3]. On September 1, 2021, defendant filed a Notice of Removal, removing this case to this
Court on the basis of diversity jurisdiction. [Doc. 1]. Defendant contends that diversity exists because plaintiff is a resident of West Virginia and defendant is a citizen of Delaware. [Doc. 1 at 4-5]. Likewise, the amount in controversy exceeds $75, 000. [Id. at 5]. Although the removal in this case is more than one year from the commencement, defendant contends that plaintiff's "manipulation" of its removal rights constitutes bad faith. [Id. at 3].
On September 10, 2021, plaintiff filed the instant Motion. In her memorandum in support, plaintiff argues that removal in this case is untimely under 28 U.S.C. § 1446(c)(1) and that defendant has not shown that the plaintiff has acted in bad faith. While plaintiff does not dispute that the amount in controversy now exceeds $75, 000, she argues that the power to stop accruing damages was within the control of defendant, who continued to send the monthly billing statements. [Doc. 6 at 5]. Plaintiff further argues that "the fact that Plaintiff has amended her Complaint in good faith has already been factually established by the Circuit Court of Appeals for Ohio County (sic)" in allowing the amendment. [Id. at 6]. Plaintiff requests this Court award attorneys' fees, costs, and actual expenses incurred as a result of removal. [Id. at 7-8].
In response, defendant argues that, first, plaintiff's original stipulation was effective in preventing removal. [Doc. 7 at 2]. Second, that the amount in controversy did not have to meet the jurisdictional threshold at the time of filing and plaintiff could have alleged greater damages based on the ongoing violations. [Id. at 3-4]. Finally, that the withdrawal of the stipulation, in itself, constitutes bad faith. [Id. at 4-8].
In her reply, plaintiff contends that defendant has failed to demonstrate any act of bad faith. [Doc. 8 at 1].
LEGAL STANDARD
"We begin with the undergirding principle that federal courts, unlike most state courts, are courts of limited jurisdiction, created by Congress with specified jurisdictional requirements and limitations. Accordingly, a party seeking to adjudicate a matter in federal court must allege and, when challenged, must demonstrate the federal court's jurisdiction over the matter. If a plaintiff files suit in state court and the defendant seeks to adjudicate the matter in federal court through removal, it is the defendant who carries the burden of alleging in his notice of removal and, if challenged, demonstrating the court's jurisdiction over the matter." Strawn v. AT&T Mobility, 530 F.3d 293, 296 (4th Cir. 2008) (citations omitted).
Defendants in civil actions may remove a matter from state to federal court if the latter forum has original subject matter jurisdiction. This requirement can be based upon diversity jurisdiction or federal question jurisdiction. 28 U.S.C. § 1441. A federal district court has diversity jurisdiction over cases between citizens of different states where the amount in controversy exceeds $75, 000.00, exclusive of interest and costs. 28 U.S.C. § 1332. Further, a federal district court has federal question jurisdiction over all civil actions arising under the Constitution, laws, or treaties of the United States. 28 U.S.C. § 1331. This particular jurisdiction must inhere in the plaintiff's claim, ratherthan be based on a defense or counterclaim. Louisville & Nashville R.R. v. Mottley, 211 U.S. 149 (1908).
Federal courts "are obliged to construe removal jurisdiction strictly because of the 'significant federalism concerns implicated.' Therefore, 'if federal jurisdiction is doubtful, a remand to state court is necessary.'" Maryland Stadium Auth. v. Ellerbe Becket Inc., 407 F.3d 255, 260 (4th C¡r. 2005) (quoting Mulcahey v. Columbia Organic Chems. Co., 29 F.3d 148, 151 (4th C¡r. 1994)); see also Healy v. Ratta, 292 U.S. 263, 270 (1934) ("Due regard for the rightful independence of state governments, which should actuate federal courts, requires that they scrupulously confine their own jurisdiction to the precise limits which the statute has defined.").
Defendants seeking removal bear the burden of demonstrating that jurisdiction is proper. See Strawn, 530 F.3d at 296-97. "While a defendant filing a notice of removal under 28 U.S.C. § 1446(a) need only allege federal jurisdiction in a short plain statement-just as federal jurisdiction is pleaded in a complaint-when removal is challenged, the removing party bears the burden of demonstratingthat removal jurisdiction is proper." Id. at 297 (citing Ellenburg v. Spartan Motors Chassis, Inc., 519 F.3d 192, 200 (4th Cir. 2008)); see also Dart Cherokee Basin Operating Co. v. Owens, 57'4 U.S. 81, 88-89 (2014) (when challenged, defendant must show that removal is proper by...
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