Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_19-cv-02099/USCOURTS-casd-3_19-cv-02099-0/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 28:1331 Fed. Question

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19-cv-2099-GPC(RBB)

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

LVNV FUNDING LLC,

Plaintiff,

v.

MELINA C. HALL, and individual; and 

DOES 1 through 10, inclusive,

Defendant.

Case No.: 19-cv-2099-GPC(RBB)

ORDER SUA SPONTE REMANDING 

CASE TO STATE COURT FOR 

LACK OF SUBJECT MATTER 

JURISDICTION

On November 4, 2019, Defendant Melina C. Hall, proceeding pro se, filed a notice 

of removal.1 (Dkt. No. 4.) Based on the reasoning below, the Court sua sponte remands 

the case to state court for lack of subject matter jurisdiction. 

Discussion

On September 10, 2019, Plaintiff LVNV Funding LLC filed a complaint against 

Defendant Melina C Hall in the San Diego Superior Court for account stated and open 

book account seeking damages in the amount of $5,456.78. (Dkt. No. 4 at 72.) On 

November 4, 2019, Defendant filed a notice of removal asserting the Court’s diversity 

 

1 On November 1, 2019, Melina Hall mistakenly filed her answer and counterclaim as a Complaint in 

this Court. (Dkt. No. 1.) Three days later, she corrected her filing with a notice of removal. (Dkt. No. 

4.) 

2 Page numbers are based on the CM/ECF pagination. 

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19-cv-2099-GPC(RBB)

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and federal question jurisdiction based on allegations in her counterclaim. Her 

counterclaim alleges violations of the TCPA3, FCRA4and FDCPA5and seeks statutory 

damages in the amount of $84,000. (Dkt. No. 1.) Defendant claims that the Court has 

subject matter jurisdiction over the case because her counterclaim alleges violations of 

federal law and she seeks over $75,000. (Dkt. No. 4 at 2-3.) 

“Federal courts are courts of limited jurisdiction.” Kokkonen v. Guardian Life Ins. 

Co. of Am., 511 U.S. 375, 377 (1994). “It is to be presumed that a cause lies outside this 

limited jurisdiction, and the burden of establishing the contrary rests upon the party 

asserting jurisdiction.” Id. It is well-established that a federal court cannot reach the 

merits of any dispute until it confirms that it retains subject matter jurisdiction to 

adjudicate the issues presented. Steel Co. v. Citizens for a Better Environ., 523 U.S. 83, 

94-95 (1988). 

Federal subject matter jurisdiction may be based on (1) federal question 

jurisdiction under 28 U.S.C. § 1331 or (2) diversity jurisdiction under 28 U.S.C. § 1332. 

The complaint must establish either that federal law creates the cause of action or that the 

plaintiff’s right to relief necessarily depends on the resolution of substantial questions of 

federal law. Franchise Tax Board of Cal. v. Construction Laborers Vacation Trust for 

Southern Cal., 463 U.S. 1, 10–11 (1983). Alternatively, a federal court may have 

diversity jurisdiction over an action involving citizens of different states where the 

amount in controversy exceeds $75,000. 28 U.S.C. § 1332. 

The presence or absence of federal question jurisdiction “is governed by the ‘wellpleaded complaint rule,’ which provides that federal jurisdiction exists only when a 

federal question is presented on the face of plaintiff’s properly pleaded complaint.” 

Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). It is well settled that a “case may 

not be removed to federal court on the basis of a federal defense . . . even if the defense is 

 

3 Telephone Consumer Protection Act.

4 Fair Credit Reporting Act.

5 Fair Debt Collection Practices Act.

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19-cv-2099-GPC(RBB)

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anticipated in the plaintiff's complaint, and even if both parties concede that the federal 

defense is the only question truly at issue.” Id. at 393. Moreover, a counterclaim cannot 

be a basis for federal question jurisdiction under 28 U.S.C. § 1331. Holmes Grp., Inc. v. 

Vornado Air Circulation Sys., Inc., 535 U.S. 826, 831-32 (2002) (“allowing responsive 

pleadings by the defendant to establish ‘arising under’ jurisdiction would undermine the 

clarity and ease of administration of the well-pleaded-complaint doctrine, which serves as 

a ‘quick rule of thumb’ for resolving jurisdictional conflicts.”). The more than $75,000 

amount in controversy must also be evident from the complaint and not counterclaim. 

See e.g., Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 

2003). Here, Defendant improperly relies solely on the allegations in the counterclaim to 

seek the Court’s diversity and federal question jurisdiction. Accordingly, Defendant has 

failed to demonstrate the Court has subject matter jurisdiction over the complaint and the 

case must be remanded to state court.

Conclusion

Based on the reasoning above, the Court SUA SPONTE remands the case to state 

court. 

IT IS SO ORDERED.

Dated: November 22, 2019

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