### REVISED December 9, 2013

IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

No. 13

- 20192 Summary Calendar

NOEL T. CONNELL,

Plaintiff

– Appellant

v. CITIMORTGAGE, INCORPORATED; HUGHES, WATTERS, & ASKANASE, L.L.P.,

Defendants

– Appellees

Appeal from the United States District Court for the Southe rn District of Texas USDC No. 4:12

- CV

- 3265

Before REAVLEY, JONES and PRADO, Circuit Judges

. PER CURIAM: * Appellant Noel T. Connell filed a state court suit on the eve of CitiMortgage, Incorporated’s (“CMI”) scheduled foreclosure of his house. He joined Appellees CMI and Hughes, Watters, & Askanase (“HWA”), the law firm that made demand for his nonpayment of amounts allegedly due. CMI

* Pursuant to 5 TH C IR . R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5 TH C IR . R. 47.5.4. United States Court of Appeals Fifth Circuit 

### FILED November 18, 2013 Lyle W. Cayce Clerk Case: 13-20192 Document: 00512464700 Page: 1 Date Filed: 12/09/2013No. 13

- 20192 removed the case to the federal district court, arguing that the law firm was fraudulently joined in the suit, rendering irrelevant its citizenship for diversity

purposes. Borden v. Allstate Ins. Co. , 589 F.3d 168, 171 (5th Cir . 2009). S oon after ward, the district court set a pretrial conference to discuss the case. Immediately before the conference, Connell moved to remand because the law firm is also a Texas resident whose joinder as a defendant destroyed complete diversity

. During the hearing, it became clear that the court had not read and did not take time to review the just

- filed motion to remand, nor did the court follow Appellees’ arguments. Instead, the court characterized Connell’s suit as arising under federal ques tion jurisdiction, and it wrongly equated Connell’s pleadings alleging violations of the Texas Finance Code with pleadings under the federal Fair Debt Collection Practices Act. On this basis alone, the court denied remand. Summary judgment was later awar ded to the Appellees. This court has been placed at a disadvantage on appeal. Because the issue of fraudulent joinder goes to the court’s jurisdiction, we review it de novo

. La. ex rel. Caldwell v. Allstate Ins. Co. , 536 F.3d 418, 425 (5th Cir. 2008). W e cannot approve the trial court’s methodology, however, which ignored the parties’ pleadings and arguments in favor of its own creative evaluation of the case. We must therefore start over without the benefit of a reliable district court ruling. First, the question of diversity jurisdiction is reviewed based on the pleadings at the time of removal. Cavallini v. State Farm Mu. Auto Ins. Co. , 44 F.3d 256, 264 (5th Cir. 1995). Second, in addressing a claim of fraudulent joinder, the question is whe ther there is no possibility that the plaintiff could prevail on a claim asserted against an in

- state defendant. Travis v. Irby , 326 F.3d 644, 647 (5th Cir. 2003).

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- 20192 Connell acknowledges that his state court pleading asserted the wrong section of the Texas Finance Code as the basis of a claim against the law firm, which is not a “credit bureau.” Cf. Tex. Fin. Code § 392.201 with § 392.202

. Connell did not seek to cure this pleading defect until after Appellees’ motions for summary judgment had been filed. His state court pleading must be the operative pleading for analysis of diversity jurisdiction. Because Connell’s pleading relied on an inapposite statutory provision, there was “no possibility” that he could prevail against the law firm on this claim. There was also no reasonable possibility that Connell would recover against the law firm under
asserted claims applying specifically to debt collectors. See Tex. Fin. Code §§ 392.303(a)(2) and 392.304(a)(8). T he Texas Finance Code specifically
excludes “an attorney collecting a debt as an attorney on behalf of and in the name of a client ” from the meaning of debt collector, and Connell did not allege in his pleadings that the law firm qualified as a debt collector under the two exception s to this exclusi on. See Tex. Fin. Code § 392.001(7). Therefore, jurisdiction was proper in the federal court. The remainder of the proceeding against Connell, although short

- lived, shows no reversible error. The court did not abuse its discretion in rejecting
his amended pleading. Ballard v. Devon Energy Prod. Co. , 67 8 F.3d 360, 364 (5th Cir. 2012). Connell had been placed on notice immediately upon the filing of the removal that CMI claimed fraudulent joinder, and he knew the reason
was the mischaracterization o f the law firm’s status under state law. Yet he waited three months, until after the summary judgment motion s and his

response s had been filed, to amend and state a different provision of the Texas Finance Code relevant to the law firm’s conduct. The cou rt was not re quired to stop in midstream for Connell to amend his pleadings. Because Connell challenges only the court’s procedure and not its substantive summary judgment ruling, we do not consider the merits of the 3 Case: 13-20192 Document: 00512464700 Page: 3 Date Filed: 12/09/2013No. 13

- 20192 ruling. The record of the hearing disp lays the court’s verbally articulated reasoning in granting summary judgment; the reasoning was sufficiently clear and connected to the Appellees’ motion that Connell is not prejudiced in any way by the absence of a written opinion. The court did not abus e its discretion in ruling on the record rather than by writing an opinion. See Brumley Estate v. Iowa Beef Processors, Inc. , 704 F.2d 1351, 1359 (5th Cir. 1983). For these reasons, the judgment against Appellant is AFFIRMED.

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