Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_16-cv-02556/USCOURTS-caed-2_16-cv-02556-0/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 28:1331(a) Fed. Question: Real Property

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

U.S. BANK, NATIONAL 

ASSOCIATIONS, as trustee for the 

certificate holders of the LXS 2006-12N 

trust fund,

Plaintiff,

v.

ROBERT Q. BOUGHTON, SR., et al.,

Defendants.

No. 2:16-cv-02556-TLN-DB 

ORDER

This matter is before the Court pursuant to Defendants Robert Q. Boughton, Sr., Belinda 

Boughton, Robert Boughton Jr., and Jeremy Boughton’s (jointly “Defendants”) Notice of 

Removal. (ECF No. 1.) Defendant Robert Q. Boughton Sr. also filed a motion to proceed in 

forma pauperis. (ECF No. 2.) For the reasons set forth below, the Court remands the action to 

the Superior Court of California, County of Sacramento, due to lack of subject matter jurisdiction. 

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

On August 26, 2016, Plaintiff U.S. Bank, National Association (“Plaintiff”) filed an 

unlawful detainer action in the Sacramento County Superior Court of California. (Not. of 

Removal, ECF No. 1 at 8.) On October 27, 2016, Defendants filed a Notice of Removal in the 

United States District Court, Eastern District of California. (ECF No. 1.) The Notice of 

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Removal, contains a complaint by Defendant Robert Q. Boughton Sr. The complaint asserts 

Plaintiffs violated the Federal Real Estate Settlement Procedures Act (“RESPA”) by failing to 

disclose their relationship to Defendant as a lender and dealer in real properties and that Plaintiff 

wrongfully foreclosed on the property. (ECF No. 1 at 4–5.) Defendants allege that Plaintiff’s 

actions caused them to suffer the loss of their home. (ECF No. 1 at 5.)

II. STANDARD OF LAW

28 U.S.C. § 1441 permits the removal to federal court of any civil action over which “the 

district courts of the United States have original jurisdiction.” 28 U.S.C. § 1441(a). “Removal is 

proper only if the court could have exercised jurisdiction over the action had it originally been 

filed in federal court.” Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987). 

Courts “strictly construe the removal statute against removal jurisdiction,” and “the 

defendant always has the burden of establishing that removal is proper.” Gaus v. Miles, Inc., 980 

F.2d 564, 566 (9th Cir. 1992) (per curiam). Furthermore, “[i]f the district court at any time 

determines that it lacks subject matter jurisdiction over the removed action, it must remedy the 

improvident grant of removal by remanding the action to state court.” California ex rel. Lockyer 

v. Dynegy, Inc., 375 F.3d 831, 838, as amended, 387 F.3d 966 (9th Cir. 2004), cert. denied 544 

U.S. 974 (2005). 

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 the plaintiff’s properly pleaded complaint.” Caterpillar, 482 U.S. at 386. 

Removal cannot be based on a defense, counterclaim, cross-claim, or third party claim raising a 

federal question, whether filed in state court or federal court. See Vaden v. Discover Bank, 556 

U.S. 49 (2009); Hunter v. Philip Morris USA, 582 F.3d 1039, 1042–43 (9th Cir. 2009). 

III. ANALYSIS

Defendants state in the notice of removal that jurisdiction is proper under “28 U.S.C. § 

1331 pursuant to 12 U.S.C. § 2605.13. (ECF No. 1 at 2.) However, Defendants also assert 

jurisdiction is proper because “the amount in controversy exceeds the sum of $75,000. District 

court has diversity jurisdiction of the action pursuant to 28 U.S.C. 1332(a).” (ECF No. 1 at 6.) 

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After reviewing the briefing, the Court concludes that Defendants cannot present a viable 

argument to support federal jurisdiction on either basis. 

Subject matter jurisdiction exists where a federal question arises on the face of the 

complaint or if there is diversity jurisdiction. Here, there is no federal cause of action that would 

supply this court with original jurisdiction since there is no federal question presented on the face 

of Plaintiff’s complaint. See Caterpillar, 482 U.S. at 386 (“federal [question] jurisdiction exists 

only when a federal question is presented on the face of the plaintiff’s properly pleaded 

complaint”). Simply put, Plaintiff does not bring any claims within the complaint that involve a 

federal question. Defendants assert that Plaintiffs violated RESPA and seem to imply that this 

creates federal question jurisdiction. However, defenses that rest on federal question cannot form 

a basis for federal question jurisdiction. See Id. at 393 (“it is now settled law that a case may not

be removed to federal court on the basis of a federal defense”). Even though Defendants named 

the responsive pleading a complaint that does not change the fact that the document is a 

responsive pleading to Plaintiff’s original complaint. Therefore, Defendant is not entitled to 

removal on the grounds of federal question jurisdiction. 

Furthermore, Defendants cannot satisfy the requirements for diversity jurisdiction under 

section 1332. Section 1332 states that “[t]he district courts shall have original jurisdiction of all 

civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of 

interest and costs, and is between—(1) citizens of different States.” Defendants do not assert that 

the parties are citizens of different states. 

Moreover, the burden of proving the amount in controversy depends on what the plaintiff 

has pleaded. Lowdermilk v. U.S. Bank Nat’l Ass’n, 479 F.3d 994, 998, 1000 (9th Cir. 2007). 

Plaintiff’s complaint alleges damages calculated at $120 per day for the time period that 

Defendants fail to vacate the premises since August 24, 2016. Should damages be awarded in 

Plaintiff’s favor today the amount in controversy would only be around $7,500. When the 

complaint alleges damages less than the jurisdictional requirement, the party seeking removal 

must prove the amount in controversy with legal certainty. Id.; Rynearson v. Motricity, Inc., 601 

F. Supp. 2d 1238, 1240 (W.D. Wash. 2009). Defendants allege that the amount in controversy 

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requirement is met under § 1332(a) based on the “complaint” they filed in response to Plaintiff’s 

unlawful detainer action. However, no case law exists that permits a defendant’s counterclaim to 

be factored into the amount in controversy. See Franklin v. Car Financial Services, Inc., No. 

09cv1361–LAB (AJB), 2009 WL 3762687, at *2 (S.D. Cal. Nov. 9, 2009) (discussing the case 

law supporting this rule). Therefore, Defendants may not meet the amount in controversy 

requirement by considering their responsive pleading. 

Defendants have failed to establish their burden of showing that jurisdiction before this 

Court is proper based on diversity jursidiction. Therefore, it is appropriate to remand this case, 

sua sponte, for lack of federal jurisdiction. See United Investors Life Ins. Co. v. Waddell & Reed 

Inc., 360 F.3d 960, 967 (9th Cir. 2004) (“the district court ha[s] a duty to establish subject matter 

jurisdiction over the removed action sua sponte, whether the parties raised the issue or not.”).

IV. CONCLUSION

For the foregoing reasons, the Court hereby REMANDS the action to the Superior Court 

of California, County of Sacramento. Additionally, the Court has reviewed Defendant Robert Q. 

Boughton Sr.’s motion for in forma pauperis status (ECF No. 2) and finds that Defendant meets 

the requisite standard. As such, Defendant’s motion for in forma pauperis status is GRANTED.

IT IS SO ORDERED.

Dated: October 31, 2016

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