Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_24-cv-03254/USCOURTS-azd-2_24-cv-03254-0/pdf.json

Parties Involved:
Ovard Aloise Ambroise
Plaintiff
Desert Financial
Defendant

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UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

Ovard Aloise Ambroise,

Plaintiff

-vsDesert Financial,

Defendant.

CV-24-3254-PHX-DGC (JFM)

Report & Recommendation 

to Hon. Stephen M. McNamee

This matter is before the undersigned magistrate judge awaiting consents pursuant 

to 28 U.S.C. § 636(c). Because the appropriate resolution of this matter is dispositive of 

claims or defenses, the undersigned proceeds by way of a Report & Recommendation to 

Senior District Judge McNamee, pursuant to 28 U.S.C. § 636(b)(1)(B) and General Order 

21-25.

A. BACKGROUND

On November 21, 2024 Plaintiff filed a Complaint against Defendant Desert 

Financial, asserting no basis for subject matter jurisdiction. (Doc. 1 at 3.) Plaintiff makes 

only conclusory allegations, asserting: “Loan was signed under duress”; “Judith Ann 

Martin and Desert Financial colluded in a discriminatory act toward/against all.” (Id. at 

4.) Plaintiff asserts as injuries: “Debt bondage;” “Psychological abuse/anxieties;” and 

“harassment.” (Id. at 5.) 

On December 4, 2024, the Court issued an Order to Show Cause reasoning that the 

Complaint failed to include allegations to establish diversity jurisdiction, and alleged no 

facts to raise a federal question, the related federal statutes do not apply to the facts alleged, 

or do not create private causes of action and at best allege state law causes of action. 

Plaintiff was directed to show cause why the Complaint should not be dismissed. (Order 

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12/4/24, Doc. 8.) 

Plaintiff responded (Doc. 9) arguing a conspiracy to engage in fraudulent activities 

between Defendant and Judith Ann Martin, who he identifies as his mother. He argues his 

mother had him placed in a psychiatric hospital without probable cause, depriving him of 

support. Plaintiff discusses predatory lending practices, and references a variety of forms 

it may take, but alleges not facts to show predatory lending by Defendant, nor does he 

suggest federal causes of action for such practices. At most, he alleges Defendant should 

have been aware the Plaintiff would not be able to repay an automobile loan, and should 

have disclosed that fact (i.e. that it was a “predatory” loan) but did not. He complains that 

he has been aggressively contacted by text messaging, email, telephone calls and mails. 

He argues that as a result of the predatory loan, his account became overdrawn. Plaintiff 

argues federal jurisdiction over “civil liberties violations,” and asserts he has state a “claim 

of fraud and discrimination,” “discriminatory practices,” and violations of “plaintiff’s civil 

rights.” 

The undersigned concludes that, liberally construed in light of the additional 

arguments and allegations in the Response to the order to show cause, Plaintiff not only 

fails to show that the Complaint fails to establish subject matter jurisdiction, but that 

amendments to the Complaint would be futile. Therefore, the Complaint should be 

dismissed with leave to amend.

B. APPLICATION OF LAW

1. Sua Sponte Consideration of Jurisdiction

“It is to be presumed that a cause lies outside [of federal courts'] limited jurisdiction, 

and the burden of establishing the contrary rests upon the party asserting jurisdiction.” 

Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994) (citations omitted). 

Thus, Federal Rule of Civil Procedure 8(a)(1) requires a “short and plain statement of the 

grounds for the court’s jurisdiction.” “The presence or absence of federal-question 

jurisdiction is governed by the ‘well-pleaded complaint rule,’ which provides that federal 

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jurisdiction exists only when a federal question is presented on the face of the plaintiff's 

properly pleaded complaint.” Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). The 

courts “are obliged to inquire sua sponte whenever a doubt arises as to the existence of 

federal jurisdiction.” Mt. Healthy City Sch. Dist. Bd. of Educ. v. Doyle, 429 U.S. 274, 278 

(1977).

2. Liberal Construction

Because Plaintiff is proceeding pro se, the Court is generally obligated to liberally 

construe his pleading. Hebbe v. Pliler, 627 F.3d 338, 342 (9th Cir. 2010). The liberal 

construction mandate requires the Court to read a claim as asserting legal theories 

suggested by the facts alleged.

Moreover, the liberal construction rule means that a judge should 

apply the relevant law regardless whether a self-represented litigant 

has mentioned it by name. Although a court cannot create a claim or 

a defense for a self-represented litigant where none exists, a judge 

should interpret a self-represented litigant's papers to raise the 

strongest arguments they suggest and to give effect to a pleading in 

conformity with the general theory that it was intended to follow.

Cynthia Gray, Reaching Out or Overreaching: Judicial Ethics and Self-Represented 

Litigants, 27 J. Nat’l Ass’n Admin. L. Judiciary 97, 124-125 (2007). “We believe that this 

[liberal construction] rule means that if the court can reasonably read the pleadings to state 

a valid claim on which the plaintiff could prevail, it should do so despite the plaintiff's 

failure to cite proper legal authority, his confusion of various legal theories, his poor syntax 

and sentence construction, or his unfamiliarity with pleading requirements.” Hall v. 

Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991). 

The undersigned assumes arguendo in Plaintiff’s favor that this liberal construction 

mandate applies to the direction in Federal Rule of Civil Procedure 8(a)(1) that a pleading 

must contain “a short and plain statement of the grounds for the court's jurisdiction.” 

To that end, to the extent that Plaintiff’s Response proposes new legal grounds for 

jurisdiction, the considers them. But, none suffice.

/ /

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3. Diversity Jurisdiction

Neither in his Complaint nor in his Response to the Order to Show Cause does 

Plaintiff allege or establish that this Court has diversity jurisdiction. 

Diversity jurisdiction generally depends upon Plaintiff making allegations showing 

each defendant is a citizen of a different state than Plaintiff, and the amount in controversy 

is more than $75,000. 28 U.S.C. § 1332(a). Plaintiff’s failure to include in the Complaint 

and the Response any allegations regarding the parties’ citizenship or the amount in 

controversy. This precludes a finding of subject matter jurisdiction based on diversity. 

Moreover, diversity jurisdiction depends upon the “citizenship” of a party, not their 

residence, domicile, or headquarters. To demonstrate citizenship for diversity purposes a 

party must: (i) be a citizen of the United States, and (ii) be domiciled in a state of the 

United States. See Lew v. Moss, 797 F.2d 747, 749 (9th Cir. 1986). See also Wright & 

Miller, Devices to Defeat Diversity Jurisdiction—Utilization of John Doe Defendants, 13F 

Fed. Prac. & Proc. Juris. § 3642 (3d ed.) (discussing effect of Doe defendants and result 

when eventually determined to be non-diverse); and Macheras v. Ctr. Art Galleries--

Hawaii, Inc., 776 F. Supp. 1436 (D. Haw. 1991) (same). Finally, the statute provides: “a 

corporation shall be deemed to be a citizen of every State and foreign state by which it has 

been incorporated and of the State or foreign state where it has its principal place of 

business.” 28 U.S.C. § 1332 (c)(1). Plaintiff makes no assertions about the place of 

incorporation of Defendant or its principal place of business. 

4. Federal Question Jurisdiction

Plaintiff broadly asserts that his claims touch on federal laws and therefore this 

Court has jurisdiction. However, Plaintiff fails to show that any federal question exists on 

the facts alleged in the Complaint. In his Response, Plaintiff asserts that the Court should 

nonetheless find jurisdiction because his allegations implicate federal laws. However, 

“where there is no federal private right of action, federal courts may not entertain a claim 

that depends on the presence of federal question jurisdiction under 28 U.S.C. § 1331.” 

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Webb v. Smart Document Sols., LLC, 499 F.3d 1078, 1083 (9th Cir. 2007). 

Civil Rights Violations - 42 U.S.C. § 1983 – Plaintiff asserts jurisdiction on the 

basis that he has alleged violations of his civil rights. Most civil rights law suits are based 

on a private right of action provided for under § 1983. That section only applies to actions 

taken “under color of state law,” which requires action by “state actors,” i.e. state or local 

governmental authorities. It “excludes from its reach merely private conduct, no matter 

how discriminatory or wrong.” Sutton v. Providence St. Joseph Med. Ctr., 192 F.3d 826, 

835 (9th Cir. 1999). ). “The mere fact that a business is subject to state regulation does 

not by itself convert its action into that of the State for purposes of the Fourteenth 

Amendment.” Jackson v. Metro. Edison Co., 419 U.S. 345, 350 (1974). Plaintiff offers 

no facts to show Defendant was a state actor. 

Conspiracy – 42 U.S.C. § 1985 - 42 U.S.C. § 1985(3) provides a right of action 

for a conspiracy to deprive someone of equal protection under the law. Here, Plaintiff 

alleges a discriminatory conspiracy, but offers no allegations to show that it was a 

conspiracy to deny equal protection of the laws, as opposed to merely deny him of his 

money. Moreover, “[l]ike § 1983, which requires the wrongdoer to be a state actor, § 

1985(3) requires at least one of the wrongdoers in the alleged conspiracy to be a state

actor.” Pasadena Republican Club v. W. Just. Ctr., 985 F.3d 1161, 1171 (9th Cir. 2021). 

Plaintiff has not alleged Defendant or Martin were state actors. 

Discriminatory Lending - 42 U.S.C. § 3605 prohibits discriminatory lending 

practices, and under 42 U.S.C. § 3613 a private right of action can be maintained for 

violations. But this applies only in the context of home loans (i.e. a “residential real estaterelated transaction”). Plaintiff makes no allegation that the loan he references was a home 

loan. (Indeed, Plaintiff’s application to proceed in forma pauperis (Doc. 2) indicates he 

does not own a home.) 

The Equal Credit Opportunity Act (“ECOA”), 15 U.S.C. § 1691, et seq., prohibits 

discrimination against an applicant for credit based on race, color, religion, national origin, 

sex or marital status, or age. See 15 U.S.C. § 1691(a). It creates a private right of action 

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for actual, compensatory and punitive damages, equitable relief, and recovery of costs. 15 

U.S.C. § 1691e. However, Plaintiff alleges no facts to suggest that the discrimination was 

on one of these protected bases. Moreover, an ECOA claim requires a showing that the 

Plaintiff was denied credit he was qualified to receive. Das v. WMC Mortg. Corp., 831 

F. Supp. 2d 1147, 1160 (N.D. Cal. 2011); Proof of Violation of Equal Credit Opportunity 

Act (ECOA), 142 Am. Jur. Proof of Facts 3d 259 at § 26 (Originally published in 2014). 

Plaintiff does not allege he was denied credit, but rather complains that he was granted 

credit. 

Predatory Lending – Plaintiff complains that his loan was “predatory,” asserting 

Defendant should have disclosed that Plaintiff could not afford the loan. But Plaintiff 

identifies no federal law requiring such a disclosure. The Truth in Lending Act (TILA), 

185 U.S.C. § 1631, et seq. imposes disclosure requirements in but it is generally limited 

to requiring disclosures of annual percentage rates and finance charges as part of consumer 

credit transactions. 

Section 1639 of the TILA precludes making loans “without regard to the 

consumers' repayment ability,” but this provision only applies to “high-cost mortgages” 

under 15 U.S.C. § 1602(b)(b). 15 U.S.C. § 1639(h). See id. at n. 1 (redesignation of 

§1602(a)(a) as § 1602(b)(b)). Here Plaintiff did not obtain such a mortgage. 

Fair Debt Collection – Plaintiff complains in his Response of aggressive collection 

contacts by Defendant. Harassment in collection of a debt is prohibited by the Fair Debt 

Collections Practices Act, in particular 15 U.S.C. § 1692d. However, this section applies 

only to actions by a “debt collector.” A “debt collector” is one who regularly attempts to 

collect a debt “owed or due to another,” specifically excluding “any officer or employee 

of a creditor while, in the name of the creditor, collecting debts for such creditor.” 15 

U.S.C. § 1692a(6) and (6)(A). Here, Plaintiff complains only of Defendant’s actions in 

collecting the debt owed to it. 

Conclusion re Federal Question Jurisdiction

Based on the foregoing, a federal question is not presented on the face of the 

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Complaint, nor is one suggested by Plaintiff’s response to the Order to Show Cause.

5. Dismissal without Leave to Amend

Because it fails to establish subject matter jurisdiction of this Court, the Complaint

must be dismissed. 

“A pro se litigant must be given leave to amend his or her complaint unless it is 

‘absolutely clear that the deficiencies of the complaint could not be cured by amendment.’” 

Noll v. Carlson, 809 F.2d 1446, 1448 (9th Cir. 1987) (quoting Broughton v. Cutter 

Laboratories, 622 F.2d 458, 460 (9th Cir.1980)). Here, even considering the arguments 

and allegations in the Response to the Order to Show Cause, Plaintiff fails to supply a 

basis for subject matter jurisdiction over his claims. “Dismissal of a complaint without 

leave to amend is proper where it is clear that the complaint could not be saved by 

amendment.” Cooper v. Ramos, 704 F.3d 772, 783 (9th Cir. 2012).

Accordingly, the dismissal should be without leave to amend. 

“Ordinarily, a case dismissed for lack of subject matter jurisdiction should be 

dismissed without prejudice so that a plaintiff may reassert his claims in a competent 

court.” Frigard v. United States, 862 F.2d 201, 204 (9th Cir. 1988) (dismissing with 

prejudice because no other court had power to hear claim barred by sovereign immunity). 

Here, there appears no reason to conclude that Plaintiff could not raise his claims in a state 

court. Accordingly, a dismissal without leave to amend but without prejudice is the 

appropriate disposition. 

C. EFFECT OF RECOMMENDATION

This recommendation is not an order that is immediately appealable to the Ninth 

Circuit Court of Appeals. Any notice of appeal pursuant to Rule 4(a)(1), Federal Rules of 

Appellate Procedure, should not be filed until entry of the district court's judgment.

However, pursuant to Rule 72, Federal Rules of Civil Procedure, the parties shall 

have fourteen (14) days from the date of service of a copy of this recommendation within 

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which to file specific written objections with the Court. Thereafter, the parties have 

fourteen (14) days within which to file a response to the objections. Failure to timely file 

objections to any findings or recommendations of the Magistrate Judge will be considered 

a waiver of a party's right to de novo consideration of the issues, see United States v. 

Reyna-Tapia, 328 F.3d 1114, 1121 (9th Cir. 2003) (en banc), and will constitute a waiver 

of a party's right to appellate review of the findings of fact in an order or judgment entered 

pursuant to the recommendation of the Magistrate Judge, Robbins v. Carey, 481 F.3d 1143, 

1146-47 (9th Cir. 2007). 

In addition, the parties are cautioned Local Civil Rule 7.2(e)(3) provides that 

“[u]nless otherwise permitted by the Court, an objection to a Report and Recommendation 

issued by a Magistrate Judge shall not exceed ten (10) pages.” 

D. RECOMMENDATIONS

IT IS THEREFORE RECOMMENDED

(A) Plaintiff’s Complaint (Doc. 1) be DISMISSED WITHOUT LEAVE TO AMEND 

AND WITHOUT PREJUDICE. 

(B) The Clerk be directed to enter judgment accordingly. 

Dated: December 10, 2024

24-3254r RR 24 12 09 re Dismiss Subj Matter Jurisd.docx

James F. Metcalf

United States Magistrate Judge

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