Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_09-cv-02676/USCOURTS-caed-2_09-cv-02676-0/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 15:1601 Truth in Lending

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28 This matter is deemed suitable for decision without oral *

argument. E.D. Cal. R. 230(h).

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

CHARLES DAY, )

)

Plaintiff, ) 2:09-cv-02676-GEB-KJM

)

v. ) ORDER DENYING PLAINTIFF’S

) MOTION TO REMAND*

AMERICAN HOME MORTGAGE SERVICING, )

INC., CLC FUNDING, and DOES 1-50, )

inclusive, )

)

Defendants. )

) 

On October 14, 2009, Plaintiff filed a Motion to Remand this

case to the Sacramento County Superior Court in California from which

it was removed. Plaintiff argues since Plaintiff and Defendant CLC

Funding are both citizens of California, and Defendant CLC Funding is

not a “sham” defendant as argued Defendant American Home Mortgage

Servicing, Inc. (“AHMSI”) argues in its notice of removal, this Court

lacks diversity subject matter jurisdiction. 

“If [a] plaintiff fails to state a cause of action against a

resident defendant, and the failure is obvious according to the

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settled rules of the state, the joinder of the resident defendant is

fraudulent.” McCabe v. General Foods Corp., 811 F.2d 1336, 1339 (9th

Cir. 1987). “Fraudulent joinder must be proved by clear and

convincing evidence.” Hamilton Materials, Inc. v. Dow Chemical Corp.,

494 F.3d 1203, 1206 (9th Cir. 2007). “The defendant seeking removal

to the federal court is entitled to present the facts showing the

joinder to be fraudulent.” McCabe, 811 F.2d at 1339. “[F]raudulent

joinder claims may be resolved by ‘piercing the pleadings’ and

considering summary judgment-type evidence . . . .” Morris v.

Princess Cruises, Inc., 236 F.3d 1061, 1068 (9th Cir. 2001) (quoting

Cavallini v. State Farm Mutual Auto Ins. Co., 44 F.3d 256, 263 (5th

Cir. 1995)).

AHMSI argues CLC Funding is a “sham” defendant since “no

possible cause of action has been stated against [CLC Funding].” 

(Not. of Removal 4:1-2; Def.’s Opp’n 2:17-18.) AHMSI also presents

the deed of trust which names American Brokers Conduit as the

originating lender. (Not. of Removal Ex. A.) Plaintiff rejoins in a

conclusory fashion, “each cause of action is against all defendants.” 

(Mot. to Remand 5:26.) Plaintiff also argues he “took out the

mortgage through CLC Funding, a California corporation[,and that the]

loan was funded by CLC and was then sold and/or assigned to American

Home Mortgage Servicing, Inc.” (Mot. to Remand 3:5-9.) However,

Plaintiff’s complaint does not allege facts showing that CLC Funding

was involved in the mortgage transaction. Additionally, American

Brokers Conduit is listed as the originating lender, and CLC Funding

is not named in the deed of trust. Since Plaintiff has not shown that

CLC Funding has any relationship to the mortgage at issue in this

case, Plaintiff’s joinder of CLC Funding is fraudulent. Therefore,

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CLC Funding is dismissed as a defendant, and Plaintiff’s Motion to

Remand is DENIED.

Dated: January 26, 2010

 

GARLAND E. BURRELL, JR.

United States District Judge

Case 2:09-cv-02676-GEB -CMK Document 22 Filed 01/27/10 Page 3 of 3