Peeples v. Ditech Fin. LLC

• Decision Date: 07 November 2017
• Docket Number: Case No.: 4:17-CV-1311-VEH
• Parties: NICKELS BOWEN PEEPLES, Plaintiff, v. DITECH FINANCIAL LLC and MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., Defendants.
• Court: U.S. District Court — Northern District of Alabama

NICKELS BOWEN PEEPLES, Plaintiff, v. DITECH FINANCIAL LLC andMORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., Defendants.

Case No.: 4:17-CV-1311-VEH

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

November 7, 2017

MEMORANDUM OPINION AND ORDER

I. INTRODUCTION

On August 4, 2017, Defendants Ditech Financial LLC ("Ditech") and Mortgage Electronic Registration Systems, Inc. ("MERS") (collectively "Defendants") removed this case to the Northern District of Alabama. (Doc. 1). On that day, Defendants also filed a Motion To Dismiss. (Doc. 3). In response, the Court, on September 6, 2017, took two actions. First, the Court stayed the case until ruling on the pending Motion To Remand. (Doc. 10). Second, the Court issued an Order Requiring Repleader within 14 days because Plaintiff's Complaint was a "shotgun pleading." (Doc. 11).

Now before the Court is Plaintiff Peeples's Motion To Remand (the "Remand Motion") filed on September 5, 2017. (Doc. 8). Defendants responded on September 15, 2017. (Doc. 12). In Defendants' response, they moved to stay ruling on the Remand Motion until after Plaintiff files an amended complaint, and they also argued their opposition to the Motion. (Id. at 1). To date, Plaintiff has neither filed a new complaint, nor has he replied to Defendants' response. Accordingly, this Motion is ripe for review.

The issue presented is whether this case meets the amount in controversy requirement needed to confer federal jurisdiction. For the reasons herein stated, this Court determines that it does. Accordingly, the Remand Motion is DENIED.

II. RELEVANT FACTUAL AND PROCEDURAL BACKGROUND

This case arises from a dispute over a home foreclosure. (Doc. 1-2 at 4-7). The Complaint states nine counts for relief. (Id. at 7-14). It does not explicitly state a specific dollar amount in controversy. (See generally id.). The case was originally filed in the Circuit Court of St. Clair County, Alabama, on July 5, 2017. (Id. at 3). The complaint states multiple counts. (Id. at 7-14). Among those claims are quiet title, negligence, wantonness, wrongful foreclosure, slander of title, placed in a false light, defamation/libel/slander, and declaratory relief. (Id.).

Defendants Ditech and MERS removed this case to the Northern District of Alabama on August 4, 2017. (Doc. 1 at 1). The basis for removal was diversity jurisdiction. (Id. at 2-6). Although the Defendants do not state as much in their Noticeof Removal, this case was removed under 28 U.S.C. § 1446(b)(1). That statute states:

(b) Requirements; generally.--(1) The notice of removal of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based, or within 30 days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter.

(2)(A) When a civil action is removed solely under section 1441(a), all defendants who have been properly joined and served must join in or consent to the removal of the action.

(B) Each defendant shall have 30 days after receipt by or service on that defendant of the initial pleading or summons described in paragraph (1) to file the notice of removal.

(C) If defendants are served at different times, and a later-served defendant files a notice of removal, any earlier-served defendant may consent to the removal even though that earlier-served defendant did not previously initiate or consent to removal.

(3) Except as provided in subsection (c), if the case stated by the initial pleading is not removable, a notice of removal may be filed within 30 days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable.

28 U.S.C. § 1446(b). Defendants filed the Notice of Removal within 30 days after being served. (Doc. 1 at 7); (see also Doc. 1-2 at 21-22). They base their removal on the complaint filed in state court, not a later "pleading, motion, order or other paperfrom which it may be first ascertained that the case is one which is or has become removable." (See generally Doc. 1-2); see 28 U.S.C. § 1446(b)(3). This means that it is a "first paragraph removal case." See Smith v. Family Dollar Stores, Inc., No. 7:14-cv-161-SLB, 2014 WL 4793445 at *2 (N.D. Ala. Sept. 25, 2014).¹,²

Defendants allege complete diversity of citizenship. (Doc. 1 at 3-4). Defendants also allege that this case meets the amount in controversy requirement. (Id. at 4). However, Plaintiff argues that this case does not meet the amount in controversyrequirement. (Doc. 8 at 5-7).

III. LEGAL STANDARDS

A. Subject Matter Jurisdiction Generally

"It is by now axiomatic that the inferior 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)). "Accordingly, '[w]hen a federal court acts outside its statutory subject-matter jurisdiction, it violates the fundamental constitutional precept of limited federal power.'" Univ. of S. Ala., 168 F.3d at 409 (quoting Victory Carriers, Inc. v. Law, 404 U.S. 202, 212, 92 S. Ct. 418, 425, 30 L. Ed. 2d 383 (1971)). "Simply put, once a federal court determines that it is without subject matter jurisdiction, the court is powerless to continue." Univ. of S. Ala., 168 F.3d at 410.

"A necessary corollary to the concept that a federal court is powerless to act without jurisdiction is the equally unremarkable principle that a court should inquire into whether it has subject matter jurisdiction at the earliest possible stage in the proceedings." Id. "Indeed, it is well settled that a federal court is obligated to inquire into subject matter jurisdiction sua sponte whenever it may be lacking." Id. (citingFitzgerald v. Seaboard Sys. R.R., 760 F.2d 1249, 1251 (11th Cir. 1985) (per curiam)).

Moreover, "[t]he jurisdiction of a court over the subject matter of a claim involves the court's competency to consider a given type of case, and cannot be waived or otherwise conferred upon the court by the parties. Otherwise, a party could 'work a wrongful extension of federal jurisdiction and give district courts power the Congress denied them.'" Jackson v. Seaboard Coast Line R.R., 678 F.2d 992, 1000-01 (11th Cir. 1982) (quoting American Fire & Cas. Co. v. Finn, 341 U.S. 6, 18 (1951)) (footnote omitted) (citation omitted). Furthermore, "[b]ecause removal jurisdiction raises significant federalism concerns, federal courts are directed to construe removal statutes strictly." Univ. of S. Ala., 168 F.3d at 411 (citing Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108-09 (1941)).

Lastly, Congress has decreed and the Supreme Court has confirmed that - with the express exception of civil rights cases that have been removed - orders of remand by district courts based upon certain grounds, including in particular those premised upon lack of subject matter jurisdiction, are entirely insulated from review. More specifically, § 1447(d) provides:

An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1443 of this title shall be reviewable by appeal or otherwise.

28 U.S.C. § 1447(d) (emphasis added); see also Kirchner v. Putnam Funds Trust, 547 U.S. 633, 642 (2006) (recognizing that "'[w]here the [remand] order is based on one of the grounds enumerated in 28 U.S.C. § 1447(c), review is unavailable no matter how plain the legal error in ordering the remand'") (citing Briscoe v. Bell, 432 U.S. 404, 413 n.13 (1977)); Milton I. Shadur, Traps for the Unwary in Removal and Remand, 33 no. 3 Litigation 43 (2007); Powerex Corp. v. Reliant Energy Servs., Inc., 127 S. Ct. 2411, 2418 (2007) (holding that when "the District Court relied upon a ground that is colorably characterized as subject-matter jurisdiction, appellate review is barred by § 1447(d)").

B. Defendant's Burden on Removal

The burden of establishing subject matter jurisdiction for the purposes of removal to this court is on the removing defendant. See Williams v. Best Buy Co., 269 F.3d 1316, 1319 (11th Cir. 2001) ("Because this case was originally filed in state court and removed to federal court by Best Buy, Best Buy bears the burden of proving that federal jurisdiction exists."). "The court should determine its jurisdiction over the case 'based upon the plaintiff's pleadings at the time of removal.'" Fowler v. Provident Life & Accident Ins. Co., 256 F. Supp. 2d 1243, 1246 (N.D. Ala. 2003).

"[B]ecause the jurisdiction of federal courts is limited, the Eleventh Circuit Court of Appeals favors remand of cases that have been removed where federaljurisdiction is not absolutely clear." Lowe's OK'd Used Cars, Inc. v. Acceptance Ins. Co., 995 F. Supp. 1388, 1389 (M.D. Ala. 1998) (citing Burns v. Windsor, 31 F.3d 1092, 1095 (11th Cir. 1994)). "In fact, removal statutes are to be strictly construed, with all doubts resolved in favor of remand." Lowe's, 995 F. Supp. at 1389 (emphasis added) (citing Diaz v. Sheppard, 85 F.3d 1502, 1505 (11th Cir.1996)).

C. Unspecified Amount in Controversy

The Eleventh Circuit stated the following regarding situations where the Plaintiff alleges unspecified damages:

If a plaintiff makes "an unspecified demand for damages in state court, a removing defendant must prove by a preponderance of the evidence that the amount in controversy

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