Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_11-cv-00099/USCOURTS-casd-3_11-cv-00099-2/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 28:1331(a) Fed. Question: Real Property

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

MARIO DURAZO,

Plaintiff,

CASE NO. 11cv0099-GPB(KSC)

ORDER SUA SPONTE

REMANDING TO STATE

COURT FOR LACK OF

SUBJECT MATTER

JURISDICTION AND

DENYING DEFENDANTS’

MOTION TO DISMISS FIRST

AMENDED COMPLAINT AND

MOTION TO STRIKE

PORTIONS OF THE FIRST

AMENDED COMPLAINT 

[Dkt. Nos. 70, 71, 88.]

vs.

CAL-WESTERN RECONVEYANCE

CORPORATION, a California

corporation, WACHOVIA

MORTGAGE, a division of WELLS

FARGO BANK, N.A., a federally

chartered bank, and DOES 1 through

10, inclusive,

Defendants.

Before the Court is Defendant Wachovia Mortgage, a division of Wells Fargo

Bank, N.A.’s (“Wachovia”) motion to dismiss and motion to strike the first amended

complaint. (Dkt. Nos. 83, 84.) On May 24, 2013, Defendant Cal-Western

Reconveyance Corporation filed a notice of joinder in Wachovia’s motion to dismiss

and motion to strike. (Dkt. Nos. 85, 86.) On June 6, 2013, Plaintiff filed an opposition

and an “ex parte motion to reconsider judgement (sic).” (Dkt. Nos. 88, 90.) On June

20, 2013, Wachovia filed a reply. (Dkt. No. 91.) On June 21, 2013, Defendant Cal-

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Western Reconveyance Corporation filed a joinder in the reply. (Dkt. No. 92.) Based

on a review of the operative pleading, and the briefing on the motion to dismiss, the

Court SUA SPONTE remands the matter to state court and DENIES Defendants’

motion to dismiss. 

Background

On January 18, 2011, the case was moved to this court from the Superior Court

of California, County of San Diego. (Dkt. No. 1) The notice of removal states that the

Court has subject matter jurisdiction because Plaintiff alleged at least one violation of

a federal statute. (Id.) On March 14, 2011, District Judge Anello granted in part and

denied in part Defendant Wachovia’s motion to dismiss the complaint. (Dkt. No. 17.) 

On October 9, 2012, the case was transferred to the undersigned judge. (Dkt. No. 60.) 

On December 5, 2012, plaintifffiled a first amended complaint(“FAC”) alleging

nine state law causes of action based on the foreclosure of his home. (Dkt. No. 65.) 

Subsequently, Defendant Wachovia filed a motion to dismiss and motion to strike with

Cal-Western Reconveyance Corporation filing a notice of joinder in these motions. 

(Dkt. Nos. 70, 71, 72, 73.) No opposition was filed by Plaintiff. On May 7, 2013, the

Court granted Defendants’ unopposed motions to dismiss and motions to strike and

dismissed the FAC without prejudice. (Dkt. No. 78.) On May 15, 2013, Plaintiff filed

a motion to vacate the Clerk’s judgment, (Dkt. No. 81), which the Court granted on

May 21, 2013. (Dkt. No. 82.) A new briefing schedule was set as to the pending

motions filed by Wachovia. 

Discussion

The federal court is one of limited jurisdiction. Lowdermilk v. U.S. Bank Nat’l

Ass’n, 479 F.3d 994, 997 (9th Cir. 2007). It possesses only that power authorized by

the Constitution or a statute. See Bender v. Williamsport Area Sch. Dist., 475 U.S.

534, 541 (1986). It is constitutionally required to raise issuesrelated to federal subject

matter jurisdiction, and may do so sua sponte. Steel Co. v. Citizens for a Better Envt,

523 U.S. 83, 93–94 (1998); see Indus. Tectonics, Inc. v. Aero Alloy, 912 F.2d 1090,

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1092 (9th Cir. 1990). Removal jurisdiction is governed by 28 U.S.C. § 1441 et seq. 

A state court action can only be removed if it could have originally been brought in

federal court. Caterpillar, Inc. v. Williams, 482 U.S. 386, 392, 107 (1987); Duncan v.

Stuetzle, 76 F.3d 1480, 1485 (9th Cir.1996). Thus, for an action to be removed on the

basis of federal question jurisdiction, 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 burden of establishing federal jurisdiction is on the party seeking removal,

and the removal statute is strictly construed against removal jurisdiction." Emrich v.

Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir.1988). The presence or absence of

federal question jurisdiction “is governed by the ‘well-pleaded 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., 482 U.S. at 392. 

A review of the amended complaint in this case shows that Plaintiff alleges nine

causes of action under California state law. (Dkt. No. 65, FAC.) In the motions to

dismiss, while Defendants do not address subject matter jurisdiction, itseeks dismissal

of the state law claims because they are preempted by the Home Owners’ Loan Act

(“HOLA”), 12 U.S.C. § 1461 et seq. 

“[A] state claim may be removed to federal court in only two

circumstances-when Congress expressly so provides . . . or when a federal statute

wholly displaces the state-law cause of action through complete pre-emption.”

Beneficial Nat’l Bank v. Anderson, 539 U.S. 1, 8 (2003). Complete preemption is

sometimes invoked by reference to the “artful pleading” doctrine, under which “a

well-pleaded state law claim presents a federal question when a federal statute has

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completely preempted that particular area of law.” Hall v. N. Am. Van Lines, Inc., 476

F.3d 683, 687 (9th Cir. 2007). Two types of preemption exists. Ordinary premption

is a federal defense to a state law claim and “insufficient to confer federal jurisdiction

if the complaint on its face does not present a federal question.” Moore-Thomas v.

Alaska Airlines, 553. F.3d 1241, 1244 (9th Cir. 2009) (citation omitted). On the other

hand, complete preemption may remove a state-law claim “[w]hen [a] federal statute

completely pre-empts [a] state-law cause of action, a claim which comes within the

scope of that cause of action, even if pleaded in terms of state law, is in reality based

on federal law. This claim is then removable under 28 U.S.C. § 1441(b), which

authorizes any claim that ‘arises under’ federal law to be removed to federal court.”

Beneficial Nat’l Bank, 539 U.S. at 8. 

Although the NinthCircuit has not yet addressed the question of whether HOLA

completely preempts state law claims, districts court within the Ninth Circuit have

concluded that HOLA and its implementing regulations do not have the effect of

complete preemption. See, e.g., Bazan v. U.S. Bancorp, No. 10–CV–03265–LHK,

2011 WL 566804, at *4 (N.D. Cal. Feb. 14, 2011); Wilburn v. IndyMac Bank, F.S.B.,

No. CIV2:10-3384 WBS CMK, 2011 WL 2174608, at *2 (E.D. Cal. June 1, 2011);

Sarzaba v. Aurora Loan Servs., No. 10cv1569 BTM (NLS), 2010 WL 3385062, at *3

(S.D. Cal. Aug. 26, 2010); Pazos v. Wachovia, No. CV 10–2732 AHM (CWx), 2010

WL 3171082, at *3–4 (C.D. Cal. Aug.10, 2010); Caampued v. First Federal Bank of

California, No. C 10–0008 RS, 2010 WL 963080, at *2 n. 1 (N.D. Cal. Mar.16, 2010). 

This Court agrees and finds the analysis in these cases to be persuasive. Since HOLA 

does not provide for complete preemption, the state law claims alleged in the FAC do

not confer federal subject matter jurisdiction on this Court.

Conclusion

Based on the above, the Court finds no basis for subject matter jurisdiction in

this case and SUA SPONTE remandsthe matter to state court and DENIES Defendants’

motions to dismiss and motion to strike. The Court also DENIES Plaintiff ex parte

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motion to reconsider judgment. The Clerk of Court shall close the case. 

IT IS SO ORDERED. 

DATED: July 22, 2013

HON. GONZALO P. CURIEL

United States District Judge

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