Welch v. Pen Air Fed. Credit Union

• Decision Date: 25 September 2019
• Docket Number: CIVIL ACTION NO. 18-00220-B
• Parties: ELMORE S. WELCH, JR., Plaintiff, v. PEN AIR FEDERAL CREDIT UNION, Defendant.
• Court: U.S. District Court — Southern District of Alabama

ELMORE S. WELCH, JR., Plaintiff, v. PEN AIR FEDERAL CREDIT UNION, Defendant.

CIVIL ACTION NO. 18-00220-B

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

September 25, 2019

ORDER

This action is before the Court on review following the Court's sua sponte issuance of a show cause order directing the parties to address whether subject matter jurisdiction exists in this case (Doc. 40). While Defendant/Counterclaimant Pen Air Federal Credit Union filed a statement regarding subject matter jurisdiction (Doc. 42) in response to the Court's order, no response has been filed by Plaintiff/Counter-Defendant Elmore S. Welch, Jr., who is proceeding pro se. For the reasons set forth below, the Court finds that subject matter jurisdiction is lacking. Accordingly, this matter is due to be DISMISSED without prejudice.

I. BACKGROUND

On May 10, 2018, Plaintiff Elmore S. Welch, Jr. ("Welch"), proceeding pro se, filed a complaint and a motion to proceed without prepayment of fees. (Docs. 1, 2). The factual allegations of Welch's original complaint¹ are as follows:

Before this Court a fraudulent contract took place with this Bank Corporation that is licensed in the State of Florida. My Attorney that I was using in this matter to pursue my purchase contract is also licensed in Florida.

On 6/15/2017, I purchased a truck. The list price was 21,000.00. 3,000.00 was put down and 500.00 went towards full coverage insurance for 6 months at 84.00 a month.

Pen Air Bank Corp. removed my contract out of my buying package when they made copies after I signed for 242.00 dollars and 100.00 for an extended warranty contract. That contract was 20,060.00 dollars. After I left the bank they mailed a contract to me for an additional 442.00 that I didn't sign for, making the total contract equaling to 29,528.00, fraudulently signing my name.

I contacted Attorney Dana Brook Cooper to act on my behalf to obtain my contract policy in which she failed to do by not suing Pen Air Bank Corp. for fraud, signing my name to their made-up contract.

Pen Air Bank made up that contract for this truck at a rate of 937.00 a month after 2,200.00 was already paid by me for the truck. The balance for the truck is 25,528.00 dollars. The more I pay, the more they add and the agreed amount was for 20,060.00 dollars. Dana Brook Cooper wanted me to continue paying for the truck without a contract as she stated on her letter mailed to me.

(Doc. 1 at 1). Welch attached to his complaint various documents, including correspondence between him and attorneyDana Brooks Cooper, a letter presumably sent by attorney Cooper to Pen Air Federal Credit Union on Welch's behalf, an automobile purchase agreement, copies of checks or money orders from Pen Air Federal Credit Union to Chris Carroll Automotive, insurance documents, loan documents, and correspondence from Pen Air Federal Credit Union to Welch. (Doc. 1 at 2-32).

The Court granted Welch's motion to proceed without prepayment of fees on May 25, 2018. (Doc. 3 at 1). Having granted Welch in forma pauperis status, the Court proceeded to review his complaint under 28 U.S.C. § 1915(e)(2).² In an order dated May 25, 2018 (Doc. 3), the Court observed that it was not clear what, if any, basis for federal jurisdiction exists in this case and that while Welch mentioned diversity jurisdiction, he did not allege the states of which he and the Defendants were citizens, nor did he allege the amount in controversy. (Id. at4). Thus, Welch was ordered to file an amended complaint, prior to service of process, setting forth facts in support of his assertion of diversity jurisdiction. (Id.).

On June 1, 2018, Welch filed an amended complaint using a Court complaint form as a template, and he alleged the following:

(Grounds for jurisdiction)

1. Rule 28 USC Section 1332

Banks are bonded by (FDIC)

(Show plaintiff's name(s) and residence or address)

2. Elmore S. Welch Jr.

[address omitted by the Court]³

(Show defendant(s) name(s) and address(es))

3. Pen Air Bank Corporation etc al.

1495 E. Mile Rd

Pensacola Fla 32514

(State briefly your legal claim or your reason for filing suit. Include the statue under which the suit is filed.)

4. Banks are FDIC bonded, when banks fraud aganish there coustmer's it excess a truck noted, and $75,000.00 [sic]

(Give a brief, concise statement of the specific facts involved in your case)

5. My contract I sign for was remove from my buying packing of $242 a month to $442 month(State the relief you are requesting.)

6. $250,000 that insurance by (FDIC) for taking my truck, changing my contract and fraud my name on a different contract, to make over $10,000.000 profit.

(Doc. 4 at 1-2)

Welch also attached an additional handwritten page to his amended complaint, wherein he stated:

Before Court a Case has taking place contain to a Diversity jursidiction Laws of Rules enter by Law, to remain for the U.S. District Court the Laws, under Litter Tucker Act, are 28 USC § 1346 and Contract Disputies Act, of 41 USC § 7101, 28 USC § 1346(a)(2) The Federal Courts do not have jursidiction to act on these Laws. Tucker Act Law is a differant matter of Rules provide under 28 USC § 1491, 28 USC § 754 and 959(a) 18 USC § 1344 Section 1344 18 USC § 656 and 657 28 USC § 1332 are Laws stated before this Court. [sic]

(Id. at 4).

On July 31, 2018, Pen Air Federal Credit Union⁴ ("Pen Air"), filed an answer to Welch's amended complaint. (Doc. 10). Pen Air requested and was granted permission to file an amended answer and counterclaim, and filed such on December 11, 2018. (Docs. 27, 30, 31). In both Pen Air's answer and amended answer, it asserted as an affirmative defense "that this Court lacks subject matter jurisdiction over this case as Plaintiff has failed to adequately plead the amount in controversy required by28 U.S.C. § 1332." (Doc. 10 at 2; Doc. 31 at 2). In its counterclaim, Pen Air asserted a breach of contract claim against Welch. (Doc. 31 at 4-6).

Upon review of Pen Air's motion for summary judgment and the other filings in this case, the undersigned again questioned whether there was subject matter jurisdiction over the case. As a result, on June 21, 2019, the Court ordered Welch, as the party alleging federal jurisdiction, to show cause, on or before August 5, 2019, as to whether subject matter jurisdiction existed. (Doc. 40). The Court also ordered Pen Air to set forth its position as to whether the Court is permitted or required to exercise jurisdiction over Pen Air's counterclaim in the event of a determination by the Court that it lacks subject matter jurisdiction over Welch's claims. (Id. at 9-10). Welch failed to respond to the Court's show cause order. In its response, Pen Air asserted that if the Court lacks subject matter jurisdiction over Welch's claims, then the Court also lacks subject matter jurisdiction over Pen Air's counterclaim. (Doc. 42).

II. SUBJECT MATTER JURISDICTION REVIEW

Federal courts are courts of limited jurisdiction. As a result of this limitation, federal district courts have the obligation to ensure that subject matter jurisdiction exists.Cadet v. Bulger, 377 F.3d 1173, 1179 (11th Cir. 2004) ("Federal courts 'are obligated to inquire into subject-matter jurisdiction sua sponte whenever it may be lacking.'") (quoting Galindo-Del Valle v. Att'y Gen., 213 F.3d 594, 599 (11th Cir. 2000)); Univ. of S. Ala. v. Am. Tobacco Co., 168 F.3d 405, 411 (11th Cir. 1999) (federal courts are courts of limited jurisdiction and must examine their subject matter jurisdiction notwithstanding the presence of other motions pending before the court). "As the Federal Rules of Civil Procedure state, 'If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action.'" Williams v. Warden, Fed. Bureau of Prisons, 713 F.3d 1332, 1337 (11th Cir. 2013) (quoting Fed. R. Civ. P. 12(h)(3)); see also Morrison v. Allstate Indem. Co., 228 F.3d 1255, 1261 (11th Cir. 2000) ("[O]nce a court determines that there has been no grant [of jurisdiction] that covers a particular case, the court's sole remaining act is to dismiss the case for lack of jurisdiction.").

"In a given case, a federal district court must have at least one of three types of subject matter jurisdiction: (1) jurisdiction under a specific statutory grant; (2) federal question jurisdiction pursuant to 28 U.S.C. § 1331; or (3) diversity jurisdiction pursuant to 28 U.S.C. § 1332(a)." Baltin v. Alaron Trading Corp., 128 F.3d 1466, 1469 (11th Cir. 1997),cert. denied, 525 U.S. 841 (1998). Two main statutes confer original jurisdiction on the district courts. The first is 28 U.S.C. § 1331, which provides a federal forum "in federal-question cases—civil actions that arise under the Constitution, laws, or treaties of the United States." Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552 (2005). The second is 28 U.S.C. § 1332, which "provide[s] a neutral forum for what have come to be known as diversity cases, [that is] civil actions between citizens of different States, between U.S. citizens and foreign citizens, or by foreign states against U.S. citizens." Id. "To ensure that diversity jurisdiction does not flood the federal courts with minor disputes, § 1332(a) requires that the matter in controversy in a diversity case exceed a specified amount, currently $75,000." Id. If jurisdiction is based on either federal question or diversity jurisdiction, "the pleader must affirmatively allege facts demonstrating the existence of jurisdiction and include 'a short and plain statement of the grounds upon which the court's jurisdiction depends.'" Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994) (quoting Fed. R. Civ. P. 8(a)).

The Court notes Welch's pro se status and consequently gives his pleadings a liberal construction, holding them to a more lenient standard than those drafted by an attorney. SeeTannenbaum v. United States, 148 F.3d 1262, 1263 (11th Cir. 1998) (per curiam). However, "this leniency does not permit the...