Morgan v. PNC Bank

• Decision Date: 14 May 2014
• Docket Number: CIVIL ACTION NO. 14-00181-KD-B
• Parties: GLORIA MORGAN, Plaintiff, v. PNC BANK, NATIONAL ASSOCIATION, Defendant.
• Court: U.S. District Court — Southern District of Alabama

GLORIA MORGAN, Plaintiff, v. PNC BANK, NATIONAL ASSOCIATION, Defendant.

CIVIL ACTION NO. 14-00181-KD-B

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF ALABAMA NORTHERN DIVISION

DONE and ORDERED: May 14, 2014

ORDER

This action is before the Court on Defendant's Amendment to Notice of Removal (Doc. 8), timely filed in response to the Court's Order sua sponte addressing subject-matter jurisdiction (Doc. 5), along with Plaintiff's Motion to Remand (Doc. 7). Upon consideration, the Court finds that, though given the opportunity, Defendant has failed to establish that the Court has subject-matter jurisdiction over this case. Accordingly, Plaintiff's Motion to Remand (Doc. 7) is due to be GRANTED.

I. Procedural History

On April 23, 2014, Defendant initiated this action by removing the case from the Circuit Court of Dallas County, Alabama, under 28 U.S.C. § 1441(a). (Doc. 1). Defendant's notice of removal alleged federal question jurisdiction under 28 U.S.C. § 1331¹ as the sole basis for the Court's subject-matter jurisdiction over the claims asserted. On April 30, 2014, following a review of the record, the Court sua sponte determined that "Defendant, as the party who sought removal in this action, has failed to meet its burden of demonstrating that subject-matter jurisdiction exists." (Doc. 5 at 7). Defendant was granted until May 7, 2014, to file "whatever materials it deems necessary to demonstrate to the Court that subject-matter jurisdiction exists in this action." (Id.).

Defendant's Amendment to Notice of Removal (Doc. 8) was timely filed by this deadline. It too asserts only federal question jurisdiction under § 1331 as the basis for the Court's subject-matter jurisdiction over the claims asserted. Between the entry of the Court's Order (Doc. 5) and the filing of Defendant's Amendment (Doc. 8), Plaintiff filed her Motion to Remand (Doc. 7), which also asserts that federal question jurisdiction does not exist in this action.

II. Analysis

The Court has already determined that the record as it existed on April 30, 2014, does not support a finding of subject-matter jurisdiction in this action. (Doc. 5). The Court renews that determination and will herein address only whether Defendant has sufficiently cured that defect in its Amendment to Notice of Removal (Doc. 8). For the following reasons, the Court finds that Defendant has not done so. See, e.g., Kirkland v. Midland Mortgage Co., 243 F.3d 1277, 1281 n.5 (11th Cir. 2001) ("[I]n removal cases, the burden is on the party who sought removal to demonstrate that federal jurisdiction exists.").

"It is . . . axiomatic that the inferior federal courts are courts of limited jurisdiction. They are 'empowered to hear only those cases within the judicial power of the United States as defined by Article III of the Constitution,' and which have been entrusted to them by a jurisdictional grant authorized by Congress." Univ. of S. Ala. v. Am. Tobacco Co., 168 F.3d 405, 409 (11th Cir. 1999) (quoting Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994)). "Congress has provided for removal of cases from state court to federal court when the plaintiff's complaint alleges a claim arising under federal law." Rivet v. Regions Bank of Louisiana, 522 U.S. 470, 472 (1998). Where, as here, only state-law claims are asserted in a complaint, a claim "aris[es] under" federal law if it "necessarily raise[s] a stated federal issue, actually disputed and substantial, which a federal forum may entertain without disturbing any congressionallyapproved balance of federal and state judicial responsibilities." Grable & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 314 (2005); Gunn v. Minton, 133 S. Ct. 1059, 1065 (2013). "The test ordinarily applied for determining whether a claim arises under federal law is whether a federal question appears on the face of the plaintiff's well-pleaded complaint." Cmty. State Bank v. Strong, 651 F.3d 1241, 1251 (11th Cir. 2011), cert. denied, 133 S. Ct. 101 (2012).

Previously, the Court found that "Defendant's notice of removal does not persuade the Court that Plaintiff's fleeting, unspecified references to federal law[ in her TRO Petition] implicates federal issues that are '(1) necessarily raised, (2) actually disputed, (3) substantial, and (4) capable of resolution in the federal court without disrupting the federal-state balance approved by Congress.' " (Doc. 5 at 5 (quoting Gunn, 133 S. Ct. at 1065)). The Court finds that Defendant's Amendment to Notice of Removal (Doc. 8) similarly fails to persuade. However, subject matter jurisdiction is not established even under the arguments Defendant has presented in its Amendment (Doc. 8).

Defendant asserts that the Court "has jurisdiction over this case because Plaintiff's TRO Petition is based at least in part on the federal Home Affordable Modification Program ('HAMP')." (Doc. 8 at 2). The Eleventh Circuit has explained HAMP as follows:

During the economic crisis of 2008, Congress passed the Emergency Economic Stabilization Act of 2008 (EESA), 12 U.S.C. §§ 5201-5261. EESA charges the Secretary of the United States Department of the Treasury with acting in a manner that "preserves homeownership and promotes jobs and economic growth." Id. § 5201(2)(B). To this end, the Department of the Treasury created the Making Home Affordable Program, a program that included HAMP.

Miller v. Chase Home Fin., LLC, 677 F.3d 1113, 1115-16 (11th Cir. 2012).

As Defendant notes, the Eleventh Circuit has determined that neither HAMP nor EESA expressly or impliedly creates "a private right of action for borrowers against loan servicers . . ." Miller, 677 F.3d at 1116. Accord Mathis v. Nationstar Mortgage, Ltd., Civ. A. No.12-0386-WS-N, 2012 WL 6162233, at *4 (S.D. Ala. Dec. 11, 2012) (Steele, C.J.) ("In Miller v. Chase Home Finance, LLC, 677 F.3d 1113 (11th Cir. 2012), the Eleventh Circuit ruled that '[n]either HAMP nor EESA expressly creates a private right of action for borrowers against loan servicers.' Id. at 1116. The Court then 'addressed ... whether there is an implied private right of action under HAMP.' Id. After engaging in the standard analysis of such issues, the Court 'conclude[d] that no such right exists.' Id. The parties agree that Miller precludes a federal cause of action under HAMP.").

In arguing that Plaintiff is making claims based on HAMP, Defendant asserts: "Plaintiff is claiming that she applied for a loan modification and she is seeking to enjoin PNC from foreclosing until she obtains a loan modification... Significantly, there should be no dispute that Plaintiff submitted an application for a loan modification under HAMP or that her application was denied." (Doc. 8 at 2). Miller applies squarely to such a situation, precluding a private cause of action in such circumstances. See Mathis, 2012 WL 6162233, at *6 ("Miller applies when the defendant declines to modify the loan and the plaintiff alleges that the failure to modify violates the defendant's obligations under HAMP. Those obligations, according to Miller, are 'to abide by guidelines promulgated by the Secretary when determining a mortgagor's eligibility for a permanent loan modification.' 677 F.3d at 1116. Here, the plaintiffs do not complain of a failure to modify the loan or of a breach of obligations in considering whether to modify a loan. Instead, they allege that a loan modification agreement was in fact entered but that the defendants have not honored their agreement with the plaintiffs. Miller does not reach such a situation.").

In Jairath v. Dyer, 154 F.3d 1280 (11th Cir. 1998), the plaintiff "brought suit[ in state court] pursuant to [a Georgia statute], for damages based upon a breach of a duty created under the Americans with Disabilities Act ('ADA'), pursuant to 42 U.S.C. § 12182(a). Thedefendant,...asserting that the case involved a substantial question of federal law, filed a notice of removal in federal court." Jairath, 154 F.3d at 1280-81. The Eleventh Circuit concluded that, because the ADA did not provide a private damages remedy for the kind of ADA violation the plaintiff asserted, "the district court lacked subject-matter jurisdiction over th[e] case because [the plaintiff]'s claims do not 'arise under' federal law." Id. at 1281, 1283-84. In so holding, the Jairath court found "closely analogous" the case of Merrell Dow Pharmaceuticals Inc. v. Thompson, 478 U.S. 804, (1986), in which "the plaintiffs alleged, inter alia, that the defendant drug company was negligent, and that its violation of the federal Food, Drug and Cosmetic Act ('FCDA') constituted a rebuttable presumption of negligence. The violation alleged by plaintiff was that the drug company had misbranded its product, and provided inadequate warning that its use was potentially dangerous. Thus, violation of the federal law was an element of the state law claim." Jairath, 154 F.3d at 1282.

In Merrell Dow, the Court focused on the fact that Congress had not created a private remedy for violation of the federal duty with respect to misbranding. The Court placed great significance on the congressional intention not to provide a private federal remedy. The Court stated:

[I]t would flout congressional intent to provide a private federal remedy for the violation of the federal statute. We think it would similarly flout, or at least undermine, congressional intent to conclude that the federal courts might nevertheless exercise federal-question jurisdiction and provide remedies for violations of that federal statute solely because the violation of the federal statute is said to be a "rebuttable presumption" or a "proximate cause" under state law, rather than a federal action under federal law.

[Merrell Dow, 478 U.S.] at 812, 106 S. Ct. at 3234 (footnotes omitted). The Court continued:

Given the significance of the assumed congressional determination to preclude federal private remedies, the presence of the federal issue as an element of the state tort is not the

...