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Renfroe v. Quality Loan Service Corp. of Washington

United States District Court, E.D. Washington

August 3, 2017

JAN M. RENFROE, Plaintiff,
QUALITY LOAN SERVICE CORP. OF WASHINGTON; BANK OF AMERICA, N.A., successor by merger to BAC Home Loans Servicing, LP, f/k/a Countrywide Home Loans Servicing, LP; CITIBANK, N.A., as trustee of NRZ Pass-Through Trust VI; MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC.; and BANK OF NEW YORK MELLON, as trustee on behalf of the Certificateholders of the CWHEQ Inc., CWHEQ, Revolving Home Equity Loan Trust Series 2006-C, Defendants.


          SALVADOR MENDOZA, JR. United States District Judge.

         Before the Court, without oral argument, is Plaintiff Jan M. Renfroe's Motion to Remand to Washington State Court, ECF No. 11. Through this motion, Renfroe seeks an order from this Court remanding the case back to the Superior Court for the State of Washington in and for the County of Okanogan. Id. at 1. Defendants oppose the motion. ECF Nos. 17, 21 and 22. Having reviewed the pleadings and the file in this matter, the Court is fully informed and denies the motion.


         Plaintiff Jan M. Renfroe initiated this lawsuit in the Okanogan County Superior Court on April 3, 2017. ECF No. 1-1. She named Quality Loan Services Corp. of Washington, Bank of America, Citibank, and Mortgage Electronic Registration Systems, as defendants, and the Bank of New York Mellon as nominal defendant (collectively “Defendants”). ECF No. 1-1 at 1. She seeks declaratory, injunctive, and monetary relief arising out of a dispute over a loan she acquired that was secured by her home. ECF No. 1-1 at 3-11. Renfroe asserts only state law claims, under the Washington State Deed of Trust Act and Consumer Protection Act, and for quiet title. ECF No. 1-1 at 6-10.

         While this action was in state court, Renfroe and Quality Loan Service entered into a stipulated agreement on May 2, 2017, in which Quality Loan Service was to be considered a nominal defendant, subject to certain conditions. ECF No. 1-2. On or about June 2, 2017, Renfroe received a Notice of Continuance of Trustee's Sale of her home indicating the Quality Loan Service rescheduled the sale of her home to July 28, 2017. ECF No. 12-1. About two weeks later, Renfroe's attorney sought, and Judge Christopher E. Culp of Okanogan Superior Court granted, a temporary restraining order enjoining Quality Loan Service from proceeding with the Trustee's Sale. ECF No. 13-1.

         Defendants removed the case from Okanogan Superior Court to this Court on June 1, 2017. ECF No. 1.


         Removal of a civil action from state to federal court is governed by 28 U.S.C. § 1446. Cases removed on the basis of diversity jurisdiction must present parties whose citizenship is completely diverse and contest an amount greater than $75, 000. 28 U.S.C. § 1332(a). Given the strong presumption against removal, defendants bear the burden of establishing by a preponderance of the evidence that removal is proper. Adrain v. Wells Fargo Bank, N.A., No. 2:16-cv-00142-SAB, 2016 WL 4059231, at *1 (E.D. Wash. July 27, 2016) (citing Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992)).

         For diversity jurisdiction purposes when removing a case from state to federal court, whether the parties are diverse to each other “is determined (and must exist) as of the time the complaint is filed and removal is effected.” Strotek Corp. v. Air Transp. Ass'n of Am., et al, 300 F.3d 1129, 1131 (9th Cir. 2002) (citations omitted). Once jurisdiction attaches, a party cannot destroy diversity by changing its citizenship. Id. at 1132 (citation omitted).

         Moreover, federal courts disregard formal or nominal parties' citizenship when considering citizenship for subject matter jurisdiction purposes. Batson v. Deutsche Bank Tr. Ams., No. 2:15-cv-00193, 2015 WL 5316869, at *1 (E.D. Wash. Sept. 11, 2015). Courts have defined a nominal defendant as “one ‘who holds the subject matter of the litigation in a subordinate or possessory capacity and to which there is no dispute.'” Id. (citing SEC v. Colello, 139 F.3d 674, 676 (9th Cir. 1998)). The Batson court noted that “[m]ost courts consider trustees in foreclosure suits nominal parties, unless plaintiffs have alleged direct claims against them.” Id. (citations omitted).

         As to meeting the amount in controversy requirement, when the amount of damages a plaintiff seeks is unclear from the complaint, the defendant bears the burden of proving facts supporting the jurisdictional amount. Gaus, 980 F.2d at 566-67; Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1117 (9th Cir. 2004). To discharge its burden, a defendant must “provide evidence establishing that it is more likely than not that the amount in controversy exceeds [$75, 000].” Valdez, 372 F.3d at 1117 (citations and quotations omitted). The amount in controversy must be established as of the time of removal. Grieff v. Brigandi Coin. Co., No. C14-214, 2014 WL 2608209, *1 (W.D. Wash. June 11, 2014). Defendants may rely on claims of general and specific damages, punitive damages, and attorney's fees to satisfy the amount in controversy requirement. Colvin v. Conagra Foods, Inc., No. C07-1376, 2007 WL 3306746, *2 (W.D. Wash. Nov. 5, 2007). In determining whether the jurisdictional amount is met, a reviewing court evaluates the complaint and “may consider any evidence submitted by the parties including affidavits or declarations, or other [relevant] summary-judgment-type evidence.” Coleman v. American Commerce Ins. Co., No. C16-5096, 2016 WL 2586636, *2 (W.D. Wash. May 5, 2016) (citations and quotations omitted). Defendants cannot rely on “speculation and conjecture” or “unreasonable assumptions” to meet their burden. Id.


         At the outset, the Court notes that Renfroe's argument regarding the fact that she tailored her claims for state court is unclear. ECF No. 11 at 3-4. Renfroe seems to argue that because she is the plaintiff and master of her claims and complaint, and she does not raise any federal law questions, she may avoid federal jurisdiction by relying exclusively on state law. Id. To the extent she asserts that she can avoid her case's removal from state court into federal court by relying exclusively on state law claims, that argument is unavailing. First, the Court notes that the authorities she cites in support of this proposition, ECF No. 11 at 3-4, are inapposite here. Those cases dealt with federal question jurisdiction. Here, Defendants removed on the basis of diversity jurisdiction. ECF No. 1 at 1. ...

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