Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-13-07036/USCOURTS-caDC-13-07036-0/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 9, 2014 Decided December 30, 2014

No. 13-7036

HENOK ARAYA,

APPELLANT

v.

JPMORGAN CHASE BANK, N.A., ET AL.,

APPELLEES

Appeal from the United States District Court

for the District of Columbia

(No. 1:12-cv-00335)

Henok Araya, pro se, argued the cause and filed the 

briefs for appellant. 

Jason C. Hicks argued the cause for appellees. On the 

brief were Bizhan Beiramee and Jeffrey L. Tarkenton.

Before: BROWN, MILLETT and WILKINS, Circuit Judges.

Opinion for the Court filed by Circuit Judge WILKINS.

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WILKINS, Circuit Judge: 

Henok Araya owned and operated a rental property in the 

District of Columbia, which he leased to tenants. After 

several years, the bank foreclosed on his mortgage and sold 

the property to the highest bidder. Araya sued in D.C. 

Superior Court challenging the foreclosure proceedings that 

ultimately resulted in the sale of his property. After 

defendants removed to federal court and moved for judgment 

on the pleadings, the District Court rejected Araya’s

challenges. Because the D.C. statutory and common law 

claims against the bank and its foreclosing agent should have 

been decided by the local courts, we vacate the District 

Court’s opinions and orders relating to claims against those 

parties.

I.

In October 2005, Henok Araya1 purchased property 

located at 2630 Myrtle Avenue NE in Washington, D.C. The 

purchase was financed by Chase Home Finance LLC 

(“Chase”)

2 and the property was encumbered by a security 

instrument consisting of a note and a deed of trust. Araya

purchased the property as an investment property in which 

tenants would live, and a rider to that effect was attached to 

the deed of trust. J.A. 240.

 1 Mr. Araya transposed his first and last names in the case 

caption of his Superior Court complaint, and most of the 

earlier pleadings and court orders repeated that mistake.

2 Chase Home Finance LLC originated the loan. JPMorgan 

Chase appeared before this Court as successor by merger. 

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On December 1, 2008, Araya sent Chase a letter 

indicating that he had been unable to “communicate and solve 

the issues” with several accounts. He asked that all 

correspondence be directed to 1800 New Jersey Ave NW. 

J.A. 69. The next day, Chase sent Araya an acceleration 

warning at that address, alerting Araya that his loan on the 

Myrtle Avenue property was in default. The letter told Araya

that he owed $5,814.28 and had 32 days to cure the default. 

J.A. 71. Chase sent similar acceleration warnings on March 

4, 2009; April 4, 2009; May 2, 2009; and June 2, 2009. J.A.

75-93. 

On September 21, 2009, Araya sent Chase a letter 

claiming that his mortgage payment was not behind and 

“requesting a payment research.” He provided a phone 

number that Chase should call with questions and again used 

the New Jersey Avenue address. J.A. 95.

On November 18, 2009, Chase sent another acceleration 

warning, this time to 908 New Hampshire Ave NW.

According to Araya, he mailed Chase a certified letter on 

January 20, 2010, requesting the correct amount to bring his 

account current. In that letter, he asked that Chase reply by 

email and by mail to 908 New Hampshire Ave NW #400. He 

sent identical letters on February 2, 2010, and March 17, 

2010. Around February 18, 2010, Araya received a notice 

from Shapiro & Burson, LLP, that his property was to be sold 

at a foreclosure sale. 

On March 24, 2010, the property was sold at public 

auction. J.A. 104-05. The Federal Home Loan Mortgage 

Corporation (“Freddie Mac”) purchased the home and sold it 

in turn to Dorothy Ihuoma. Id.; J.A. 46. 

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On February 2, 2012, Araya filed a complaint in the 

Superior Court of the District of Columbia against Chase and 

Shapiro & Burson asserting numerous claims including 

breach of contract, fraud, illegal foreclosure, breach of 

fiduciary duty, forgery, misrepresentation, negligence, 

statutory violations, and violation of the takings clause of the 

Fifth Amendment. The gravamen of Araya’s complaint was 

that Chase and Shapiro & Burson had not provided the proper 

notice before foreclosure and had not given him a meaningful 

opportunity to cure. Citing D.C. Sup. Ct. Civ. R. 19,3 Araya

joined Ihuoma and Fannie Mae4as defendants on the theory

that they were persons with an “interest in the property.” J.A.

289-295. 

On March 1, 2012, the defendants removed to the United 

States District Court for the District of Columbia on the basis 

of federal question jurisdiction. Notice of Removal p. 3

(March 1, 2012). On March 5, 2012, Ihuoma filed a motion 

to dismiss, arguing that she was protected from suit as a bona 

fide purchaser; the motion was granted over Araya’s 

opposition on September 11, 2012. Order on Motion to 

Dismiss p. 1 (Sept. 11, 2012). Araya did not designate the 

order granting Ihuoma’s dismissal in his notice of appeal or in 

any other way demonstrate intent to appeal that judgment of 

dismissal, and therefore this order is final and not before us. 

See Fed. R. App. P. 3(c)(1)(B); see also Brookens v. White, 

795 F.2d 178, 180 (D.C. Cir. 1986) (“[Appellant’s] failure to 

specify the [dismissal] order by name in his notice of appeal, 

or otherwise to evidence his intent to pursue an appeal from 

 3 The Superior Court rule is identical for all intents and 

purposes to Fed. R. Civ. P. 19.

4 Fannie Mae is the common moniker for the Federal National 

Mortgage Association.

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that order, renders the notice inapplicable to the earlier 

order.”). Ihuoma appears before this Court solely to contest 

Araya’s appeal of the District Court’s denial of the motions to 

amend his complaint.

On March 7, 2012, Araya filed a document entitled 

“Plaintiff’s opposition to removal of case.” Response to 

Document (March 7, 2012). In this document, Araya argued 

that his complaint raised no federal questions and was entirely 

based on D.C. law. Id. at p. 2. He also asserted that the 

parties were not diverse. Id. at p. 1.

On March 20, 2012, Chase and Fannie Mae filed a 

memorandum in opposition to Araya’s document, which they 

had construed as a remand motion. Response to Document p. 

1 (March 20, 2012). Chase and Fannie Mae argued that 

federal jurisdiction was appropriate because Araya raised 

constitutional claims and because Fannie Mae’s “sue and be 

sued” clause, 12 U.S.C. §1723a(a), created federal subject 

matter jurisdiction under Pirelli Armstrong Tire Corp. Retiree 

Med. Benefits Trust v. Raines, 534 F.3d 779 (D.C. Cir. 2008).

On May 11, 2012, the District Court denied Araya’s 

remand motion on the grounds that “[t]he D.C. Circuit has 

held that § 1723a(a) is a grant of subject matter jurisdiction.” 

Order p. 2 (May 11, 2012).

On May 25, 2012, Chase and Fannie Mae filed a joint 

motion for judgment on the pleadings. Motion for Judgment 

on the Pleadings (May 25, 2012). Shapiro & Burson filed a 

similar motion on June 19, 2012. Motion for Judgment on the 

Pleadings (June 19, 2012). On July 5, 2012, Araya filed a 

motion for partial summary judgment. Motion for Partial 

Summary Judgment (July 5, 2012). Araya also filed two 

motions for leave to file an amended complaint, the first on 

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July 26, 2012, and the second on October 24, 2012. Motion 

for Leave to File (July 26, 2012); Motion for Leave to File 

(Oct. 24, 2012). The proposed amended complaints 

eliminated the Fifth Amendment takings claim and added two 

new counts: a claim under the Real Estate Settlement 

Procedures Act (RESPA), 12 U.S.C. § 2605, and a statutory 

claim for wrongful foreclosure under D.C. Code § 42-815. 

The only difference in the two proposed complaints is that the 

second complaint replaces references to Fannie Mae with 

references to Freddie Mac. 

On February 13, 2013, the District Court issued an order 

and opinion. Henok v. Chase Home Finance, LLC, 922 F. 

Supp. 2d 110 (D.D.C. 2013). The District Court dismissed 

Fannie Mae and denied leave to add Freddie Mac on the 

grounds that “the second amended complaint fails to state a 

claim for relief on any ground.” Id. at 124-25. Although 

Fannie Mae’s presence in the suit was the perceived linchpin 

of federal subject matter jurisdiction, the District Court did 

not consider whether it should proceed to the other claims or 

remand them to the Superior Court. The District Court 

instead ruled against Araya on all of his state-law claims, 

construing D.C. law to do so. Araya filed a timely appeal.

On appeal, Araya challenges (1) the District Court’s grant 

of partial summary judgment to Chase, (2) the District Court’s 

denial of his motions for leave to amend, and (3) the District 

Court’s grant of judgment on the pleadings. After oral 

argument, we asked the parties for supplemental briefing on 

subject matter jurisdiction. We do not address the merits of 

Araya’s challenges because we conclude that the predicate for 

supplemental jurisdiction evaporated once Fannie Mae was

dismissed and the District Court denied leave to amend to add 

any new federal claims.

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II.

Ordinarily, the plaintiff is entitled to select the forum in 

which he wishes to proceed. See, e.g., Sinochem Int’l Co. v. 

Malaysia Int’l Shipping Corp., 549 U.S. 422, 436 (2007) 

(referencing “the consideration ordinarily accorded the 

plaintiff’s choice of forum”); Holmes Group, Inc. v. Vornado 

Air Circulation Systems, Inc., 535 U.S. 826, 831-32 (2002) 

(discussing extent to which plaintiff is master of the 

complaint). Congress has provided, however, that “any civil 

action brought in a State court of which the district courts of 

the United States have original jurisdiction” may be removed 

by the defendants to the federal courts. 28 U.S.C. § 1441(a)

(2012). The removal notice must contain “a short and plain 

statement of the grounds for removal,” id. § 1446(a). 

Even if a claim raising a federal question is properly 

removed from state court to federal court, the district court 

has an obligation to employ its discretion to determine 

whether to exercise supplemental jurisdiction over the 

ancillary state-law claims. City of Chicago v. Int’l Coll. of 

Surgeons, 522 U.S. 156, 167, 172-73 (1997). In doing so, the 

district court should consider “a host of factors, . . . including 

the circumstances of the particular case, the nature of the state 

law claims, the character of the governing state law, and the 

relationship between the state and federal claims.” Id. at 173. 

In addition, “[i]f the federal question is eliminated relatively 

soon after removal, it is ordinarily preferable to remand the 

case rather than dismiss the case.” 16-107 Moore’s Federal 

Practice - Civil § 107.41; see also 28 U.S.C. § 1447(c) (“If at 

any time before final judgment it appears that the district 

court lacks subject matter jurisdiction, the case shall be 

remanded.”). 

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In the removal notice, the defendants asserted two bases 

for federal court jurisdiction. First, defendants argued that 

Araya’s Fifth Amendment claims against Chase and Shapiro 

& Burson were sufficient to create federal jurisdiction under 

28 U.S.C. § 1331, which gives the federal district courts 

“original jurisdiction of all civil actions arising under the 

Constitution, laws, or treaties of the United States.” Second, 

defendants argued that 12 U.S.C. § 1723a(a), which 

authorizes Fannie Mae “to sue and to be sued” in federal 

courts, creates federal jurisdiction because Fannie Mae was a 

named party.

We consider each asserted basis of subject matter 

jurisdiction in turn.

A.

As a general matter, “the absence of a valid (as opposed 

to arguable) cause of action does not implicate subject-matter 

jurisdiction.” Steel Co. v. Citizens for a Better Env't, 523 U.S. 

83, 89 (1998). It has long been recognized, however, that “a 

suit may sometimes be dismissed for want of jurisdiction 

where the alleged claim under the Constitution or federal 

statutes clearly appears to be immaterial . . . or where such a 

claim is wholly insubstantial and frivolous.” Bell v. Hood, 

327 U.S. 678, 682-83 (1946). 

Araya’s Fifth Amendment claim against Chase and 

Shapiro & Burson is insufficient to sustain jurisdiction 

because it has been foreclosed by the Supreme Court. See

Steel Co., 523 U.S. at 89. It is beyond dispute that the Fifth 

Amendment “appl[ies] to and restrict[s] only the Federal 

Government and not private persons.” Pub. Utils. Comm’n of 

D.C. v. Pollak, 343 U.S. 451, 461 (1952); see also San 

Francisco Arts & Athletics, Inc. v. U.S. Olympic Committee, 

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483 U.S. 522, 542 (1987) (“The fundamental inquiry is 

whether the USOC is a governmental actor to whom the 

prohibitions of [the Fifth Amendment] apply.”); Corrigan v. 

Buckley, 271 U.S. 323, 330 (1926) (“The Fifth Amendment is 

a limitation only upon the powers of the General Government

and is not directed against the action of individuals.”) 

(citations omitted) (internal quotation marks omitted); Barron 

v. Baltimore, 32 U.S. 243, 250-51 (1833) (“[T]he fifth 

amendment to the constitution . . . is intended solely as a 

limitation on the exercise of power by the government of the 

United States.”). There is no plausible argument that either 

Chase or Shapiro & Burson is a governmental actor, and 

indeed Araya’s complaint does not even allege that either 

defendant is a governmental actor. The Fifth Amendment 

claim is thus an insufficient basis for federal subject matter 

jurisdiction. Understandably, the District Court did not rely 

upon the takings claim as a basis for jurisdiction when it 

denied Araya’s request to remand, and it later granted the 

motion to dismiss that claim.

B.

The argument regarding Fannie Mae presents a more 

complicated question. 

At the time of removal, Fannie Mae was named in the 

Superior Court complaint as a party that “upon information 

and belief . . . ha[d] an interest in the property,” and it is 

settled law in this Circuit that 12 U.S.C. § 1723a(a) ordinarily 

creates federal jurisdiction “in Fannie Mae cases.” Pirelli, 

534 F.3d at 785.5

 Thus, it was reasonable for the District 

 5 The Supreme Court has addressed a similar statute, holding 

that the Red Cross’s “‘sue and be sued’ provision confers 

original jurisdiction on federal courts over all cases to which 

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Court to deny Araya’s motion to remand, because Fannie Mae 

was named and had been served as a defendant in the case, 

and supplemental jurisdiction over the ancillary state claims 

(with their attendant party defendants) would appear 

appropriate insofar as those claims involved the same 

property and were related to any claim involving Fannie Mae. 

See LaShawn A. v. Barry, 87 F.3d 1389, 1396 (D.C. Cir. 

1996) (en banc) (“Whether a court may decide pendent claims 

is determined on the face of the pleadings.”).

However, after the denial of the motion to remand, 

counsel jointly representing Fannie Mae and Chase moved to 

dismiss the claim against Fannie Mae, informing the District 

Court for the first time that there was no basis for Fannie 

Mae’s inclusion in this controversy. The documents attached 

to Araya’s Superior Court complaint make it clear that the 

property was purchased at the foreclosure auction by the 

Federal Home Loan Mortgage Corporation – Freddie Mac. 

J.A. 15-35. Araya apparently mistook Freddie Mac for 

Fannie Mae. The presence of Fannie Mae in this suit is 

therefore entirely illusory. (It is not lost on us that Fannie 

Mae waited until after it had defeated plaintiff’s choice of 

forum to inform the District Court of this rather salient fact.) 

Neither our decision in Pirelli nor the Supreme Court’s 

decision in Red Cross contemplates a situation such as this, in 

which a federally chartered corporation without any 

connection whatsoever to the dispute is named as a party by 

mistake. This case does not require us to resolve the troubling 

question of whether Pirelli and Red Cross permit automatic 

 

the Red Cross is a party, with the consequence that the 

organization is thereby authorized to remove from state to 

federal court any state-law action it is defending.” American

Nat’l Red Cross v. S.G., 505 U.S. 247, 248 (1992). 

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federal jurisdiction any time Fannie Mae is mentioned in a 

party’s pleadings, however, and we decline to do so. On the 

particular facts presented in this appeal – in which a pro se

D.C. resident accidentally named the wrong federally 

chartered corporation as a potentially interested party in his 

suit against defendants residing outside the District of 

Columbia and then sought to correct that mistake by naming 

the correct federally chartered corporation – we are satisfied 

that the District Court had original jurisdiction. See Steel Co., 

523 U.S. at 89.

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C.

The District Court dismissed Fannie Mae from the 

lawsuit, Henok, 922 F. Supp. 2d at 117-24, and this dismissal 

was summarily affirmed by a panel of this Court. Henok v. 

JPMorgan Chase Bank, N.A., No. 13-7036, 2013 WL 

4711675 (D.C. Cir. Aug. 2, 2013) (per curiam). Even though 

the basis of federal question jurisdiction had vanished with 

Fannie Mae’s dismissal,

7 the District Court went on to rule on 

 6 Judge Millett would hold that because minimal diversity 

exists between these parties (Araya, the plaintiff, is a citizen 

of D.C., whereas at least one of the defendants, JPMorgan 

Chase, is not), the exercise of Article III jurisdiction in this 

instance to dismiss Ihuoma and Fannie Mae from the case was 

permissible. See State Farm Fire & Cas. Co. v. Tashire, 386 

U.S. 523, 531 (1967) (“Article III poses no obstacle to the 

legislative extension of federal jurisdiction, founded on 

diversity, so long as any two adverse parties are not cocitizens.”).

7 The District Court also denied Araya’s motion to amend his 

complaint to add Freddie Mac as a defendant or to add a claim 

asserting a RESPA violation, finding that either addition 

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the merits of Araya’s state-law claims against Chase and 

Shapiro & Burson. The question thus becomes whether that 

exercise of supplemental jurisdiction was proper.

III.

The jurisdictional grant in the supplemental jurisdiction 

statute potentially confers jurisdiction over “all other claims 

that are so related to claims in the action within such original 

jurisdiction that they form part of the same case or 

controversy under Article III of the United States 

Constitution.” 28 U.S.C. § 1367(a). However, the statute 

also provides that “[t]he district courts may decline to 

exercise supplemental jurisdiction over a claim . . . if (1) the 

claim raises a novel or complex issue of State law, (2) the 

claim substantially predominates over the claim or claims 

over which the district court has original jurisdiction, (3) the 

district court has dismissed all claims over which it has 

original jurisdiction, or (4) in exceptional circumstances, there 

are other compelling reasons for declining jurisdiction.” Id. § 

1367(c). This case implicates § 1367(c)(3) because the 

District Court was called upon to decide the validity of 

several state and common law claims despite the dismissal of 

all claims giving it federal question jurisdiction.

Prior to the enactment of the supplemental jurisdiction 

statute, the law in this Circuit was that “[i]f a district court has 

power to adjudicate a pendent claim, the court must then 

engage in a second inquiry to determine whether to exercise 

its discretion to decide the local claim.” Dimond v. District of 

Columbia, 792 F.2d 179, 188 (D.C. Cir. 1986). On several 

occasions, we found an abuse of discretion when the district 

 

would be futile. Henok, 922 F. Supp. 2d at 123-24. We agree 

with this conclusion.

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court failed to remand the case to the D.C. courts when it was 

not appropriate to retain jurisdiction. See, e.g., Financial 

General Bankshares, Inc. v. Metzger, 680 F.2d 768, 777 (D.C. 

Cir. 1982) (“When a District Court reaches out to decide 

unsettled issues of state law despite the pretrial dismissal of 

all federal claims, its action may be an abuse of discretion.”); 

REA Exp., Inc. v. Travelers Ins. Co., 554 F.2d 1200, 1201 

(D.C. Cir. 1977) (per curiam) (altering district court judgment 

so as to allow plaintiffs to file in state court). Moreover, not 

engaging in the analysis of whether to remand could itself 

potentially be an abuse of discretion. See Dimond, 792 F.2d 

at 188. We have continued to apply this two-part test even 

after the enactment of the supplemental jurisdiction statute. 

See Women Prisoners of D.C. Dep’t of Corrections v. District 

of Columbia, 93 F.3d 910, 921-22 (D.C. Cir. 1996) (noting 

that § 1367(c) does not disturb the Gibbs framework); see 

also H.R. REP. NO. 101-734 (1990), at 29 (“As under current 

law, subsection (c) requires the district court, in exercising its 

discretion, to undertake a case-specific analysis.”). 

In keeping with the principle that “[n]eedless decisions of 

state law should be avoided both as a matter of comity and to 

promote justice between the parties,” United Mineworkers of 

America v. Gibbs, 383 U.S. 715, 726 (1966), we have 

explained that “[i]n the usual case in which all federal-law 

claims are dismissed before trial, the balance of factors to be 

considered under the pendent jurisdiction doctrine . . . will 

point toward declining to exercise jurisdiction over the 

remaining state-law claims.” Shekoyan v. Sibley Intern., 409 

F.3d 414, 424 (D.C. Cir. 2005) (quoting Carnegie-Mellon 

Univ. v. Cohill, 484 U.S. 343, 350 n.7 (1988)) (holding that 

the district court properly exercised its discretion to remand 

state-law claims after dismissing federal claims). Thus, we 

have repeatedly held that a district court abuses its discretion 

when it maintains jurisdiction over a removed case presenting 

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unsettled issues of state law after the federal claims have been 

dismissed. 

For example, in Edmondson & Gallagher v. Alban 

Towers Tenants Association, this Court considered a case in 

which plaintiffs had filed a suit in D.C. Superior Court 

alleging a number of state and common law claims in addition 

to a federal RICO claim. 48 F.3d 1260, 1262 (D.C. Cir. 

1995). Defendants removed to district court and filed 

summary judgment motions. Id. at 1263. “After the district 

court dismissed the federal claims, however, it abused its 

discretion by reaching the merits of the local-law claims.” Id. 

In evaluating the district court’s exercise of its discretion, this 

Court determined that the dismissal of the federal claim, 

combined with the unsettled nature of the law regarding the 

state and common law claims, compelled the district court to 

remand to D.C. Superior Court. Id. at 1266-67; see also

Women Prisoners, 93 F.3d at 923 (“[W]e hold that the district 

court abused its discretion in exercising jurisdiction over these 

local claims in violation of the supplemental jurisdiction 

statute and the well-established principles it has codified.”); 

Financial General, 680 F.2d at 778 (holding that district court 

“abused its discretion by failing to take into account the 

uncertainty of state law and by proceeding to trial on the local 

claims after the dismissal of the federal claims”). 

Guided by this precedent, we are constrained to hold that 

the District Court abused its discretion. Unfortunately, the 

District Court did not explain in its opinion whether or how it 

applied its discretion to exercise supplemental jurisdiction 

over the state-law claims in this case. See Dimond, 792 F.2d 

at 188. As in Edmondson, “if the district court considered the 

relevant factors at all, it left no written trace of the process; 

after dismissing the [federal] claims, the court plunged into 

the common law ones with no apparent pause for breath.” 48 

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F.3d at 1266. In Edmondson, we concluded there was no 

reason to remand the case to the district court to exercise its 

discretion whether to remand in the first instance, because the 

circumstances compelled only one conclusion. Id. at 1266-

67. We noted that the complaint raised novel issues of state 

law, which was another reason to decline supplemental 

jurisdiction in addition to the dismissal of all of the federal 

claims. Id. (citing 28 U.S.C. § 1367(c)(1)). Similar issues 

permeate this case:

(1) Araya’s complaint alleges numerous vaguely worded 

claims and allegations, which the District Court construed 

with the liberality ordinarily afforded to pro se litigants. 

Although we acknowledge the District Court’s considerable 

efforts in finding a substantial number of arguable local 

statutory and common law claims in Araya’s pleadings, the 

result in this case was a 34-page opinion, less than a page of 

which involved federal claims. To the extent that Araya’s 

complaint articulates any plausible state-law claims, the D.C. 

Superior Court is eminently more qualified than a federal 

court to navigate the as-yet-unsettled contours of the statutory 

and common law claims potentially presented. And even 

were none of the individual state law issues complex, the 

process of discerning, interpreting, and deciding a half-dozen 

state-law claims could be described as undertaking to resolve 

a “complex issue of State law.” 28 U.S.C. § 1367(c)(1).

(2) Araya’s complaint, as interpreted by the District 

Court, raises issues that have not been directly confronted by 

D.C. courts, such as whether D.C. Code § 47-1431(a) (2001) 

conferred a private right of action, see Henok, 922 F. Supp. 2d 

at 124, as well as issues that have been resolved in conflicting 

ways by D.C. and federal courts, such as whether negligent 

misrepresentation requires a pre-existing confidential 

relationship, compare Sherman v. Adoption Center of 

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Washington, Inc., 741 A.2d 1031, 1037 (D.C. 1999)

(“Negligent misrepresentation requires that the defendants 

made statements that they knew or should have known were 

false, and that they knew or should have known would induce 

reliance on the part of Sherman, and that did induce such 

reliance.”) and Kumar v. D.C. Water & Sewer Auth., 25 A.3d 

9, 15 n.9 (D.C. 2011) (“To prove negligent misrepresentation, 

a plaintiff must show ‘(1) that [the defendant] made a false 

statement or omitted a fact that he had a duty to disclose; (2) 

that it involved a material issue; and (3) that [the plaintiff] 

reasonably relied upon the false statement or omission to his 

detriment . . . .’”) (quoting Redmond v. State Farm Ins. 

Co., 728 A.2d 1202, 1207 (D.C. 1999)) with Choharis v. State 

Farm Fire and Cas. Co., 961 A.2d 1080, 1089 (D.C. 2008) 

(“[C]onduct occurring during the course of a contract dispute 

may be the subject of a fraudulent or negligent 

misrepresentation claim when there are facts separable from 

the terms of the contract upon which the tort may 

independently rest and when there is a duty independent of 

that arising out of the contract itself.”).

As we concluded in Edmondson, “D.C. courts are better 

equipped to resolve the unsettled legal questions in this case.” 

48 F.3d at 1266. The District Court therefore had no choice 

but to remand. Id.; see also, e.g., Carver v. Nassau Cnty.

Interim Fin. Auth., 730 F.3d 150, 154-55 (2d Cir. 2013)

(abuse of discretion to retain supplemental jurisdiction over 

claim raising unresolved issue of state law); Creighton v. City 

of Livingston, 628 F. Supp. 2d 1199, 1218-19 (E.D. Cal.

2009) (declining to exercise supplemental jurisdiction over 

state-law claim where California courts had not yet decided 

whether private right of action existed).

This case is functionally indistinguishable from 

Edmondson. Here, as there, the District Court dismissed all 

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claims over which it had original jurisdiction; here, as there, 

“[t]here has been no trial of the common law claims,” 

Edmondson, 48 F.3d at 1266; here, as there, the local claims 

involve novel and complex issues, id.; here, as there, “there 

seems little difference in convenience for the parties whether 

they litigate in D.C. or federal court,” id. at 1267; and here, as 

there, the District Court had an obligation to exercise its 

discretion to remand the case to the District of Columbia 

courts once the federal question, like Elvis, had left the 

building.

IV.

For the foregoing reasons, we affirm the District Court’s 

order denying leave to amend Araya’s complaint to add 

additional federal claims, vacate the District Court’s orders 

relating to the state-law claims against Chase and Shapiro & 

Burson, and remand to the District Court with instructions to 

remand to Superior Court for determination of Araya’s statelaw claims against those parties.

So ordered.

USCA Case #13-7036 Document #1529566 Filed: 12/30/2014 Page 17 of 17