Opinion
Case No. 3:17-cv-00041-SB
03-27-2017
CAPITAL ONE BANK (USA), N.A., Plaintiff, v. JAMES E. CLARK, Defendant.
FINDINGS AND RECOMMENDATION
BECKERMAN, Magistrate Judge.
On November 27, 2016, Plaintiff Capital One Bank (USA), N.A. ("Plaintiff") filed suit in Hood River County Circuit Court against Defendant James Clark ("Defendant"), seeking to collect on a $4,132.08 debt. On January 9, 2017, Defendant (appearing pro se) removed the action to federal court. Plaintiff now moves to remand to Hood River County Circuit Court, arguing that (1) this Court lacks subject matter jurisdiction, and (2) Defendant failed to remove the case within the thirty-day period required by 28 U.S.C. § 1446(b). For the reasons that follow, the district judge should grant Plaintiff's motion to remand.
BACKGROUND
The following facts are taken from the Complaint, which are presumed to be true for purposes of this motion only.
Plaintiff is a lawfully organized banking business. (Compl. ¶ 1.) Defendant is an individual residing in Hood River County, Oregon. (Compl. ¶ 1.) Plaintiff entered into an agreement with Defendant, pursuant to which Plaintiff agreed to extend credit to Defendant in the form of merchandise, services, and cash advances. (Compl. ¶ 2.) Defendant defaulted on his obligation to repay Plaintiff, causing Plaintiff to suffer damages in the amount of $4,132.08. (Compl. ¶ 4.)
ANALYSIS
I. STANDARD OF REVIEW
The nature of federal courts' limited jurisdiction directs that "[t]he removal statute is strictly construed, and any doubt about the right of removal requires resolution in favor of remand. Moore-Thomas v. Alaska Airlines, Inc., 553 F.3d 1241, 1244 (9th Cir. 2009) (citation omitted). The presumption against removal means that 'the defendant always has the burden of establishing that removal is proper.'" Id.; see also Lanza v. Ashcroft, 389 F.3d 917, 930 (9th Cir. 2004) ("There is a general presumption against federal court review, and the burden of establishing the contrary rests on the party asserting jurisdiction."). This includes the burden of demonstrating compliance with the procedural requirements for removal. Riggs v. Plaid Pantries, Inc., 233 F. Supp. 2d 1260, 1264 (D. Or. 2001) (citation omitted). Thus, "[S]ection 1446(b)'s 'time limit' is mandatory [such that] a timely objection to a late petition will defeat removal[.]" Kuxhausen v. BMW Fin. Servs. NA LLC, 707 F.3d 1136, 1142 (9th Cir. 2013).
II. DISCUSSION
Plaintiff seeks an order pursuant to 28 U.S.C. § 1447(c) remanding this case to state court on two grounds. First, Plaintiff argues that this Court lacks subject matter jurisdiction because Plaintiff did not raise a federal question in the Complaint. Second, Plaintiff argues that Defendant's removal was untimely because 28 U.S.C. § 1446(b) requires the defendant to remove to federal court within thirty days of service. Defendant did not remove the case until thirty-two days after he was served.
A. Lack of Subject Matter Jurisdiction
Plaintiff first argues that this case should be remanded because Plaintiff has not raised a federal question in the Complaint. In his notice of removal, Defendant asserts that this Court has jurisdiction under 28 U.S.C. § 1331 because the suit arises under the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692. Defendant is mistaken.
Whether a case "arises under" federal law is governed by the well-pleaded complaint rule, which provides that a federal court may exercise jurisdiction "only when a federal question is presented on the face of the plaintiff's properly pleaded complaint." Balcorta v. Twentieth Century-Fox Film Corp., 208 F.3d 1102, 1106 (9th Cir. 2000). If the original case could not have been brought in federal court, any federal question asserted in a defendant's responsive pleading may not serve as the basis for federal question jurisdiction. See Vaden v. Discover Bank, 556 U.S. 49, 60 (2009) (explaining that "[f]ederal jurisdiction cannot be predicated on an actual or anticipated defense"); see also Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826, 831 (2002) (declining to adopt the principle that the "answer as well as the complaint . . . be consulted before a determination [is] made whether the case 'ar[ises] under' federal law") (citing Franchise Tax Bd. of Cal. v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 10-11, n.9 (1983))).
Here, the Complaint does not raise a federal question. Plaintiff asserts only breach of contract and quantum meruit claims, which are governed by state law. (Compl. ¶¶ 2-4.) Plaintiff makes no reference to the FDCPA in its complaint, and Defendant has not filed a counterclaim alleging a violation of the FDCPA. Even if Defendant had asserted a counterclaim arising under the FDCPA, any such counterclaim may not serve as the basis for federal question jurisdiction. See Holmes Group, Inc., 535 U.S. at 831 ("Allowing a counterclaim to establish 'arising under' jurisdiction would ... contravene the longstanding policies underlying our precedents .... [W]e decline to transform the longstanding well-pleaded complaint rule into the 'well-pleaded-complaint-or-counterclaim rule.'") (italics omitted); see also K2 Am. Corp., v. Roland Oil & Gas, LLC, 653 F.3d 1024, 1029 (9th Cir. 2011) ("Federal jurisdiction cannot hinge upon defenses or counterclaims, whether actual or anticipated.").
Absent a federal question, this court lacks federal question jurisdiction. The Court further notes that diversity jurisdiction is lacking here, because the amount in controversy does not satisfy the $75,000 jurisdictional threshold. See 28 U.S.C. § 1332(a). Accordingly, the Court lacks subject matter jurisdiction and the district judge should remand the case to state court.
B. Untimeliness
A plaintiff may also seek to remand a case if the removal notice was untimely under 28 U.S.C § 1446(b). Section 1446(b)(1) requires that a defendant's notice of removal be filed within thirty days of being served with the "initial pleading." The statutory thirty-day deadline is mandatory, and a timely objection to late removal will defeat the removal. See Fristoe v. Reynolds Metals Co., 615 F.2d 1209, 1212-13 (9th Cir. 1980).
The thirty-day removal clock began when Plaintiff served Defendant with the initial pleading on December 8, 2016. (Notice of Removal at 2.) Defendant did not file his notice of removal until January 9, 2017, thirty-two days after service. (Notice of Removal at 2.) As a result, the removal was untimely and the district judge should remand this case to state court.
CONCLUSION
For the foregoing reasons, the Court recommends that the district judge GRANT Plaintiff's motion to remand (ECF No. 4), and REMAND this case to Hood River County Circuit Court.
SCHEDULING ORDER
The Findings and Recommendation will be referred to a district judge. Objections, if any, are due fourteen (14) days from service of the Findings and Recommendation. If no objections are filed, the Findings and Recommendation will go under advisement on that date. If objections are filed, a response is due fourteen (14) days after being served with a copy of the objections. When the response is due or filed, whichever date is earlier, the Findings and Recommendation will go under advisement.
DATED this 27th day of March, 2017.
/s/_________
STACIE F. BECKERMAN
United States Magistrate Judge