Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-almd-2_10-cv-00357/USCOURTS-almd-2_10-cv-00357-0/pdf.json

Nature of Suit Code: 892
Nature of Suit: Economic Stabilization Act
Cause of Action: 12:5201 Economic Stabilization Act of 2008

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IN THE DISTRICT COURT OF THE UNITED STATES FOR THE

MIDDLE DISTRICT OF ALABAMA, NORTHERN DIVISION

JAMES MACKS and )

LISA MACKS, )

)

Plaintiffs, )

) CIVIL ACTION NO.

v. ) 2:10cv357-MHT

) (WO)

U.S. BANK NATIONAL )

ASSOCIATION, as Trustee )

for CMLTI 2007-WFHE3, and )

WELLS FARGO BANK, )

)

Defendants. )

OPINION AND ORDER

Plaintiffs James and Lisa Macks brought this lawsuit

in state court seeking damages arising out of an

attempted foreclosure on their home by defendants U.S.

Bank National Association and Wells Fargo Bank. The

banks removed this lawsuit under 28 U.S.C. §§ 1332, 1441,

& 1446 (diversity). The Mackses now move for remand to

state court because the banks have failed to demonstrate

that the $ 75,000 amount in controversy required for

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1. In Pretka v. Kolter City Plaza II, Inc., -- F.3d

--, –-, 2010 WL 2278358, at *1 (11th Cir. 2010) the

Eleventh Circuit Court of Appeals explained that “Lowery

was a case that involved removal procedures in the second

paragraph of 28 U.S.C. § 1446(b), and the decision must

be read in that context.” Pretka rejected as dicta the

Lowery court’s statement that “the ‘receipt from the

(continued...)

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diversity jurisdiction has been met in this case. For

the reasons that follow, the Mackses’ remand motion will

be granted.

I.

For purposes of removal pursuant to

diversity-of-citizenship jurisdiction, where damages have

not been specified by the plaintiff, a removing defendant

has the burden of proving by a preponderance of the

evidence that the $ 75,000 amount-in-controversy

requirement is met. Leonard v. Enterprise Rent-a-Car,

279 F.3d 967, 972 (11th Cir. 2002). The court may not

“speculate in an attempt to make up for the notice's

failings.” Lowery v. Alabama Power Co., 483 F.3d 1184,

1211 n.63 (11th Cir. 2007).1

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1. (...continued)

plaintiff’ rule is not limited to removals made under the

second paragraph of § 1446(b) but applies to first

paragraph removals as well.” Id. at *15. The Pretka

court explained that, “The substantive jurisdictional

requirements of removal do not limit the types of

evidence that may be used to satisfy the preponderanceof-evidence standard.” Id. at *8 (emphasis added).

Accordingly, this court has placed no such limitation

upon the types of evidence that may be utilized by the

defendants in order to satisfy the preponderance-ofevidence standard.

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Finally, “[r]emoval statutes are construed narrowly;

where plaintiff and defendant clash about jurisdiction,

uncertainties are to be resolved in favor of remand.”

Burns v. Windsor Ins. Co., 31 F.3d 1092, 1095 (11th Cir.

1994).

II.

In February 2007, the Mackses executed a promissory

note and a mortgage with GMFS, LLC (the original lender),

with Wells Fargo Bank instituted as the loan servicer.

The mortgage was then sold to Mortgage Electronic

Registrations Systems, Inc. In June 2008, Mortgage

Electronic assigned the mortgage to U.S. Bank.

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In 2009, the Mackses filed for Chapter 13 Bankruptcy.

After that claim was denied, the Mackses’ attorney

contacted Wells Fargo to request that it allow them to

make an effort to modify their loan and stay foreclosure

proceedings under the Home Affordable Modification

Program, a federal program designed to help financially

struggling homeowners avoid foreclosure. The request was

denied, and the Mackses were informed that only payment

in full would stop foreclosure.

In January 2010, Wells Fargo notified the Mackses

that it was increasing the interest rate on their loan

and that a loan modification was not possible for them.

Later that month, the Mackses received a notice from

Wells Fargo asserting that they had defaulted on their

loan, the entire balance of the mortgage and note was

due, and foreclosure was to begin immediately. At the

same time, U.S. Bank asserted that they own the mortgage

and also attempted to foreclose upon the Mackses’ home.

Before either bank could foreclose, however, the Mackses

filed this action in state court, seeking damages and

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requesting a temporary restraining order. After the

state court granted the temporary order, the banks

removed this case to federal court.

The Mackses argue that Wells Fargo and U.S. Bank have

no right to pursue foreclosure at this time because the

banks have failed to provide the mandatory preforeclosure default servicing required of companies that

received funds under the Troubled Asset Relief Plan, a

federal program that purchases assets and equity from

financial institutions following the subprime mortgage

crisis. The Mackses further argue that the banks have no

right to pursue foreclosure at this time because they

have failed to provide the mandatory pre-foreclosure

default servicing required by the loan agreement.

Additionally, the Mackses allege that the assignment

between Mortgage Electronic and U.S. Bank is defective,

void, or otherwise unenforceable and that the banks lack

standing to foreclose.

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The Mackses seek injunctive relief as well as damages

stemming from wrongful foreclosure, malicious

prosecution, and abuse of process. They also ask the

court to continue a state-court temporary restraining

order, thereby preventing foreclosure until their case

might be heard.

III.

The Mackses do not specify the damages sought for any

of their claims. U.S. Bank and Wells Fargo,

nevertheless, contend that this case belongs in federal

court. The banks argue that the opposing parties are from

different States and the $ 75,000 amount-in-controversy

requirement is met because “this case involves the

acceleration by Defendants of a $ 90,250 promissory note

secured by the mortgage against real property that

Plaintiffs themselves recently valued at $ 135,000.”

Def.’s Resp. in Opp. to Remand at 1 (Doc. No. 17); see 28

U.S.C. § 1332. In making this argument, the banks focus

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on the value of injunctive relief, not the damages

stemming from the Mackes’ tort claims. The banks’

argument does not persuade the court.

All parties concede that the “plaintiff-viewpoint

rule” is the proper method for determining the amount in

controversy when injunctive relief is sought. See

Ericsson GE Mobile Commc’ns v. Motorola Commc’ns &

Elecs., Inc., 120 F.3d 216, 218-19 (11th Cir. 1997)

(courts are “requir[ed] ... to measure the object of the

litigation solely from the plaintiff’s perspective.”).

“[T]he value of the requested injunctive relief is the

monetary value of the benefit that would flow to the

plaintiff if the injunction were granted.” Morrison v.

Allstate Indemnity Co., 228 F.3d 1255, 1268 (11th Cir.

2000). The banks argue, however, that even from the

Mackses’ viewpoint the amount in controversy exceeds

$ 75,000. They assert that the Mackses seek injunctive

relief barring foreclosure on the property at issue and

that, therefore, the value of the property determines the

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2. In Bonner v. City of Prichard, Ala., 661 F.2d

1206, 1209 (11th Cir. 1981) (en banc), the Eleventh

Circuit Court of Appeals adopted as binding precedent all

of the decisions of the former Fifth Circuit handed down

prior to the close of business on September 30, 1981.

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financial value at stake. To support this proposition,

they cite Waller v. Professional Ins. Corp., 296 F.2d

545, 547 (5th Cir. 1961) (“when the validity of a

contract or a right to property is called into question

in its entirety, the value of the property controls the

amount in controversy.”) (emphasis added).2

 

Crucially, however, the Mackses do not challenge the

validity of the mortgage in its entirety; they simply

assert that “[o]ne of the defendants should prove

ownership of the mortgage and debt prior to [the]

foreclosure.” Pl.’s Mot. to Remand at 3 (Doc. No. 12).

As such, the Mackses seek a temporary restraining order

until a final determination of the allegations within

their complaint have been made on the merits. From the

plaintiffs’ perspective, then, the monetary value of the

injunctive relief is not the entire value of the

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property; rather, it is the value of a delay in

foreclosure. See James v. U.S. Bank Nat. Ass’n, 2009 WL

2170045, at *4-5 (M.D. Ala. July 17, 2009) (Thompson, J.)

(holding that amount in controversy is the value of a

delay in foreclosure); see also Carstarphen v. Deutsche

Bank Nat’l Trust Co., 2009 WL 1537861, at *5 (S.D. Ala.

June 01, 2009) (Steele, J.) (same). While delay may be

very important to the Mackses, it is certainly worth much

less than the property itself, and the court cannot

simply rely on the value of the mortgage or the property

to determine that amount. See James, 2009 WL 2170045, at

*5; see also Carstarphen, 2009 WL 1537861, at *5

(determining that the court had “no basis” for valuating

temporary restraining order above $ 75,000).

Therefore, U.S. Bank and Wells Fargo have failed to

present any evidence that clearly establishes that the

amount in controversy in this case exceeds the

jurisdictional threshold of $ 75,000. 

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***

Accordingly, it is the ORDER, JUDGMENT, and DECREE of

the court that plaintiffs James Macks and Lisa Macks’s

motion to remand (Doc. No. 12) is granted and that,

pursuant to 28 U.S.C. § 1447(c), this cause is remanded

to the Circuit Court of Covington County, Alabama for

want of jurisdiction.

The clerk of the court is DIRECTED to take

appropriate steps to effect the remand.

DONE, this the 23rd day of July, 2010. 

 /s/ Myron H. Thompson 

UNITED STATES DISTRICT JUDGE

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