Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_18-cv-01503/USCOURTS-casd-3_18-cv-01503-1/pdf.json

Nature of Suit Code: 370
Nature of Suit: Other Fraud
Cause of Action: 28:1441fd Removal - Fair Debt Collection Practices Act

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18cv1503-LAB (LL)

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

KECIA M. FLANAGAN,

Plaintiff,

v.

CITIMORTGAGE, INC. et al.,

Defendants.

Case No.: 18cv1503-LAB (LL)

ORDER DISMISSING TILA AND 

FDCPA CLAIMS; AND

ORDER OF REMAND

This action was removed from state court on the basis of federal question 

jurisdiction. The complaint included two claims based on federal statutes, a Truth 

in Lending Act (TILA) claim and a Fair Debt Collection Practices Act (FDCPA) 

claim. Defendants filed motions to dismiss. Neither Defendant sought dismissal of 

the two federal claims that formed the basis for jurisdiction, except that Defendant 

North Star Homes sought dismissal of the TILA claim to the extent it was brought 

against North Star.

On reviewing the briefing, the Court found that the TILA and FDCPA claims 

appeared to be insubstantial. The lack of a substantial federal claim in the 

complaint means the Court cannot exercise federal question jurisdiction. See 

Merrell Dow Pharmaceuticals, Inc. v. Thompson, 478 U.S. 804, 823 n.3 (1986); 

see also Hannis Distilling Co. v. City of Baltimore, 216 U.S. 285, 288 (1910)

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(explaining that if a claim is “manifestly devoid of merit,” it is insubstantial for 

purposes of conferring jurisdiction). The Court is required to raise and address 

jurisdictional questions, sua sponte if necessary, whenever a doubt arises. Mt. 

Healthy City School Dist. Bd. of Ed. v. Doyle, 429 U.S. 274, 278 (1977). 

The Court must presume it lacks jurisdiction, until the party invoking the 

Court’s jurisdiction proves otherwise. Kokkonen v. Guardian Life Ins. Co. of Am., 

511 U.S. 375, 377 (1994). There is a “strong presumption” against removal 

jurisdiction, and “[f]ederal jurisdiction must be rejected if there is any doubt as to 

the right of removal in the first instance.” Gaus v. Miles, 980 F.2d 564, 566 (9th Cir. 

1992) (citations omitted).

Defendants and Plaintiff each filed a response.

TILA Claim

Plaintiff’s TILA claim appeared to be time-barred, and she never requested 

rescission. Her claim for damages based on Defendants’ failure to rescind 

therefore appeared insubstantial. In their response, Defendants made clear they 

intend to rely on the statute of limitations. Plaintiff, noting that the TILA claim was 

time-barred and that she never asked for rescission, agreed to dismiss it. 

FDCPA Claim

Plaintiff’s FDCPA claim arises from Defendants’ non-judicial 

foreclosure on her home. But the foreclosure was governed by California law, and 

Defendants were not acting as debt collectors under the FDCPA. See VienPhuong Thi Ho v. ReconTrust Company, NA, 858 F.3d 568 (9th Cir. 2017).

In her response, Plaintiff agrees the law does not permit her to bring a 

FDCPA claim based on the non-judicial sale of her home, and has agreed to 

dismiss it. Defendants agree this claim is meritless. 

Supplemental Jurisdiction

Defendants have argued that while Plaintiff’s two federal claims are 

meritless, they are not so insubstantial as to deprive the Court of jurisdiction. They 

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have also pointed to Plaintiff’s other claims, which rely in part on allegations that 

Defendants were debt collectors within the meaning of the FDCPA.

Plaintiff’s other claims do not arise under federal law, nor does their 

resolution turn on a question of federal law. Defendants point out that she has 

supported seven of her state-law claims with allegations of Defendants being debt 

collectors within the meaning of the FDCPA. 

But Plaintiff’s claims depend merely on Defendants not being legitimate 

creditors with a right to foreclose. Arguing that they were debt collectors is one way 

to do that, but she does not need to establish that they were debt collectors to 

prevail on any of these claims. See Rains v. Criterion Systems, Inc., 80 F.3d 339, 

346 (9th Cir. 1996) (“When a claim can be supported by alternative [state and 

federal law theories,] federal question jurisdiction does not attach because federal 

law is not a necessary element of the claim.”).

Of course, after this order she will no longer be able to argue that Defendants 

were debt collectors under the FDCPA or that they committed any FDCPA 

violations; this order conclusively rejects those claims.

Conclusion and Order

Defendants have argued that the federal claims were substantial, and in the 

case of the FDCPA claim, it is a closer question. The Court recognizes that if it 

found either claim substantial, it could exercise supplemental jurisdiction over the 

state law claims and consider them on the merits. But here, there would be little 

point. Plaintiff filed her complaint in state court, and was not required to meet 

federal pleading standards, so it is not surprising that she did not do so. Because 

it is not absolutely clear she could not correct defects in the complaint, she would 

have been given an opportunity to amend any claims the Court dismissed. But 

because this action is being remanded in any event, there is no reason to require 

her to try to meet federal pleading standards now. Furthermore, the Court is 

mindful of the Ninth Circuit’s admonition that “[f]ederal jurisdiction must be rejected 

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if there is any doubt as to the right of removal in the first instance.” Gaus, 980 F.2d 

at 566.

Even assuming the Court has jurisdiction over this case by virtue of either or 

both of the federal claims, it has discretion to decline to exercise that jurisdiction 

once the federal claims are dismissed, see 28 U.S.C. ' 1367(c), and it would do 

so here. See Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350–51 and n.7 

(1988). See also Ho, 858 F.3d at 576 (“Foreclosure is a traditional area of state 

concern.”)

To the extent they seek dismissal of the TILA and FDCPA claims, 

Defendants motions to dismiss (Docket nos. 6 and 17) are GRANTED, and the

TILA and FDCPA claims are DISMISSED WITH PREJUDICE. But in all other 

respects, the motions are DENIED AS MOOT. The case is REMANDED to the 

Superior Court of California for the County of San Diego.

IT IS SO ORDERED.

Dated: March 4, 2019

Hon. Larry Alan Burns

Chief United States District Judge

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