Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_08-cv-00222/USCOURTS-caed-1_08-cv-00222-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Other Contract

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

DENNIS C. ROUSTON, CASE NO. 1: 08 cv 0222 LJO GSA

Plaintiff, ORDER TO DISMISS COMPLAINT

vs.

MERCANTILE ADJUSTMENT BUREAU,

Defendant.

 /

A. INTRODUCTION

Plaintiff Dennis C. Rouston (“Plaintiff”) is pro se and he has filed an application to proceed in

forma pauperis. Plaintiff filed a complaint on February 13, 2008, against Mercantile Adjustment Bureau

(“Defendant”) in an effort resolve a conflict related to Plaintiff’s 1995 Jeep Cherokee (“Jeep”).

Specifically, the complaint alleges that Plaintiff purchased the Jeep in December 2001 through

Transouth Finance (“Transouth”). Plaintiff became disabled and was no longer able to make the

regularly scheduled payments due to his disability. Plaintiff attempted to have Transouth repossess the

vehicle, but Transouth did not do so. 

Plaintiff alleges that Transouth sold Plaintiff’s account to Defendant. Plaintiff most recently

attempted to set up a repayment plan with Defendant in May 2007, but the parties were unable to

successfully resolve the issue. Plaintiff alleges that he had agreed to make payments to Defendants

totaling $2,500.00 for the fair market value of the Jeep. However, there were disagreements regarding

when payments were to be made. Plaintiff alleges that ultimately Defendant informed Plaintiff that if

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he wanted title of the vehicle, Plaintiff would have to pay a lump sum of $6,296.01 which is the amount

Plaintiff still owed on the Jeep. Plaintiff is requesting that Defendant accept reasonable payments for

the fair market value of the vehicle or repossess the Jeep. 

B. DISCUSSION

1. Standards For Screening

Pursuant to 28 U.S.C. § 1915(e)(2), the court must conduct an initial review of the complaint for

sufficiency to state a claim. The court must dismiss a complaint or portion thereof if the court

determines that the action is legally “frivolous or malicious,” fails to state a claim upon which relief may

be granted, or seeks monetary relief from a defendant who is immune from such relief. 28 U.S.C. §

1915(e)(2); 2 Schwarzer, Tashima & Wagstaffe, California Practice Guide: Federal Civil Procedure

Before Trial (2006) Attacking the Pleadings, para. 9:226.1, pp. 9-69. “A trial court may dismiss a claim

sua sponte under Fed.R.Civ.P. 12(b)(6). . . . Such dismissal may be made without notice where the

claimant cannot possibly win relief.” Omar v. Sea-Land Service, Inc., 813 F.2d 986, 991 (9 Cir. 1987); th

see Wong v. Bell, 642 F.2d 359, 361-362 (9 Cir. 1981). Sua sponte dismissal may be made before

th

process is served on defendants. Neitzke v. Williams, 490 U.S. 319, 324 (1989) (dismissals under 28

U.S.C. § 1915(d) are often made sua sponte); Franklin v. Murphy, 745 F.2d 1221, 1226 (9 Cir. 1984) th

(court may dismiss frivolous in forma pauperis action sua sponte prior to service of process on

defendants). 

A complaint, or portion thereof, may be dismissed for failure to state a claim if it appears beyond

doubt that plaintiff can prove no set of facts in support of the claim or claims that would entitle him to

relief. See Hishon v. King & Spalding, 467 U.S. 69, 73 (1984) (citing Conley v. Gibson, 355 U.S. 41,

45-46 (1957)); see also Palmer v. Roosevelt Lake Log Owners Ass’n, 651 F.2d 1289, 1294 (9 Cir. th

1981). “[W]hen a federal court reviews the sufficiency of a complaint, before the reception of any

evidence either by affidavit or admissions, its task is necessarily a limited one. The issue is not whether

a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support

claims.” Scheurer v. Rhodes, 416 U.S. 232, 94 S.Ct. 1683, 1688 (1974); Gilligan v. Jamco Development

Corp., 108 F.3d 246, 249 (9 Cir. 1997). th

The face of the complaint reflects deficiencies to prevent plaintiff from offering evidence to

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support claims raised in the complaint.

2. Lack of Subject Matter Jurisdiction

Federal courts are courts of limited jurisdiction and lack inherent or general subject matter

jurisdiction. Federal courts can adjudicate only those cases in which the United States Constitution and

Congress authorize them to adjudicate which are essentially those involving diversity of citizenship,

or a federal question, or to which the United States is a party. Kokkonen v. Guardian Life Ins. Co., 511

U.S. 375, 114 S.Ct. 1673, 1677 (1994); Finley v. United States, 490 U.S. 545, 109 S.Ct. 2003, 2008

(1989). Federal courts are presumptively without jurisdiction over civil actions, and the burden to

establish the contrary rests upon the party asserting jurisdiction. Kokkonen, 511 U.S. at 377; 114 S.Ct.

at 1677. Lack of subject matter jurisdiction is never waived and may be raised by the court sua sponte.

Attorneys Trust v. Videotape Computer Products, Inc., 93 F.3d 593, 594-595 (9 Cir. 1996). “Nothing th

is to be more jealously guarded by a court than its jurisdiction. Jurisdiction is what its power rests upon.

Without jurisdiction it is nothing.” In re Mooney, 841 F.2d 1003, 1006 (9 Cir. 1988). th

F.R.Civ.P. 8 establishes general pleading rules and provides in pertinent part:

(a) Claims for Relief. A pleading which sets forth a claim for relief . . . shall

contain (1) a short and plain statement of the grounds upon which the court’s jurisdiction

depends, unless the court already has jurisdiction and the claim needs no new grounds

of jurisdiction to support it, (2) a short plain statement of the claim showing that the

pleader is entitled to relief, and (3) a demand for judgment for the relief the pleader

seeks.

Plaintiff has not alleged the deprivation of a federal constitutional or statutory right. Instead,

Plaintiff indicates in the Civil Cover Sheet, that jurisdiction is established pursuant to 28 U.S.C. § 1332.

28 U.S.C. § 1332 defines diversity jurisdiction. Although diversity jurisdiction may seem available

under 28 U.S.C. § 1332, the complaint fails to allege facts to support subject matter jurisdiction over

Defendant. 

District Courts have original jurisdiction of all civil actions were the matter in controversy

exceeds the sum or value of $75,000 and is between citizens of different states. 28 U.S.C. § 1332. It

appears in documents attached to the complaint that Defendant’s address is Rochester, New York.

Accordingly, Defendant may be a citizen of New York. However, the amount in controversy in this

case does not exceed $75,000. Plaintiff is seeking the fair market value of the Jeep which he alleges is

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$2,500. Alternatively, Plaintiff asserts that the amount owed on the Jeep is $6,296.01. In either instance,

the amount in controversy is well below the required amount for this court to have jurisdiction. 

Since Plaintiff has not alleged a deprivation of a constitutional or statutory right, and diversity

jurisdiction has not been established, the complaint fails to establish this court’s subject matter

jurisdiction. In the absence of subject matter jurisdiction, this court is unable to proceed on Plaintiff’s

claims. If a court determines that the complaint fails to state a claim, leave to amend the complaint may

be granted to the extent that the deficiencies of the complaint can be cured by amendment. However,

int this case, Plaintiff will not be given leave to amend since the value of the Jeep does not exceed

$75,000.

C. CONCLUSION AND ORDER

For the reasons discussed above, IT IS HEREBY ORDERED that Plaintiffs’ complaint filed on

February 13, 2008, be DISMISSED without prejudice, for lack of subject matter jurisdiction. The clerk

is directed to close this action.

 IT IS SO ORDERED.

Dated: February 21, 2008 /s/ Lawrence J. O'Neill 

66h44d UNITED STATES DISTRICT JUDGE

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