Court Opinion

ID: 4660073
Source: CourtListenerOpinion
Date Created: 2021-02-12 21:00:34.258458+00
Date Added: 2024-06-11T08:02:03.506927
License: Public Domain

NOT FOR PUBLICATION                        FILED
                   UNITED STATES COURT OF APPEALS                       FEB 12 2021
                                                                    MOLLY C. DWYER, CLERK
                                                                     U.S. COURT OF APPEALS
                            FOR THE NINTH CIRCUIT

BANK OF AMERICA, N.A., FKA                    No.   19-16802
Countrywide Home Loans Servicing, LP,
Successor by merger to BAC Home Loans         D.C. No.
Servicing, LP,                                2:16-cv-00475-RFB-EJY
                                              District of Nevada,
      Plaintiff-Counter-                      Las Vegas
      defendant-Appellee,
                                              ORDER
 v.

REMINGTON PLACE HOMEOWNERS’
ASSOCIATION; ABSOLUTE
COLLECTION SERVICES, LLC,

               Defendants,

and

9060 BOSTON SPRINGS TRUST,

      Defendant-Counter-claimant-
      Appellant.

                  Appeal from the United States District Court
                           for the District of Nevada
                Richard F. Boulware II, District Judge, Presiding

                    Argued and Submitted February 5, 2021
                          San Francisco, California

Before: SILER,* IKUTA, and NGUYEN, Circuit Judges.

      *
            The Honorable Eugene E. Siler, United States Circuit Judge for the
      9060 Boston Springs Trust (“Boston Springs”) appeals from the district

court’s summary judgment in favor of Bank of America, N.A. Because we cannot

ascertain from the record whether the district court properly exercised subject

matter jurisdiction, we vacate the district court’s judgment and remand for the

district court to determine whether there was complete diversity of citizenship

when the case was filed.

      “[W]e are obliged to raise sua sponte issues concerning district courts’

subject matter jurisdiction.” Animal Legal Def. Fund v. U.S. Dep’t of Agric., 933

F.3d 1088, 1092 (9th Cir. 2019). “If the district court lacked subject matter

jurisdiction . . . , ‘we would have jurisdiction to correct the jurisdictional error, but

not to entertain the merits of an appeal.’” Id. (quoting Matheson v. Progressive

Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003)).

      Bank of America filed this case in the district court on the basis of diversity

jurisdiction under 28 U.S.C. § 1332. Diversity jurisdiction “requires ‘complete

diversity’ of citizenship, meaning that ‘the citizenship of each plaintiff is diverse

from the citizenship of each defendant.’” Demarest v. HSBC Bank USA, N.A., 920

F.3d 1223, 1226 (9th Cir. 2019) (quoting Caterpillar Inc. v. Lewis, 519 U.S. 61, 68

(1996)).

U.S. Court of Appeals for the Sixth Circuit, sitting by designation.

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      In the complaint, Bank of America alleges that it is a citizen of North

Carolina because it “is a national bank with its principal place of business in

Charlotte.” But “a national bank is a citizen only of the state in which its main

office is located.” Rouse v. Wachovia Mortg., FSB, 747 F.3d 707, 709 (9th Cir.

2014). Frequently, “the location of a national bank’s main office and of its

principal place of business coincide,” id. at 711 (quoting Wachovia Bank v.

Schmidt, 546 U.S. 303, 317 n.9 (2006))—but not always. See id. at 709 (“Wells

Fargo’s main office is in South Dakota and its principal place of business is in

California . . . .”). Therefore, Bank of America’s allegations are insufficient to

establish its own citizenship.

      The allegations of defendants’ citizenship are also indeterminate. Bank of

America alleges that Remington Place Homeowners’ Association “is a Nevada

non-profit corporation,” but a corporation is a citizen of both its state of

incorporation “and . . . the State where it has its principal place of business.”

Hertz Corp. v. Friend, 559 U.S. 77, 80 (2010) (quoting 28 U.S.C. § 1332(c)(1)).

Absolute Collection Services, LLC, a Nevada limited liability corporation, is “a

citizen of every state of which its owners/members are citizens,” Johnson v.

Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006), but Bank of

America “cannot determine the citizenship of the members.” Boston Springs, a

Nevada trust, “has the citizenship of its trustee or trustees,” id., but Bank of

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America “cannot determine the citizenship of the trustee.” As the party invoking

federal jurisdiction, Bank of America had the burden to “allege . . . the facts

essential to show jurisdiction.” McNutt v. Gen. Motors Acceptance Corp. of Ind.,

298 U.S. 178, 189 (1936).

      “We cannot consider the merits of the appeal before assuring ourselves that

the district court had jurisdiction.” Matheson, 319 F.3d at 1091. Therefore, we

vacate the district court’s judgment and remand for the district court to ascertain

the citizenship of all the parties. “Further discovery on this issue might well

demonstrate facts sufficient to constitute a basis for jurisdiction, and in the past we

have remanded in just such a situation.” Harris Rutsky & Co. Ins. Servs. v. Bell &

Clements Ltd., 328 F.3d 1122, 1135 (9th Cir. 2003) (citation omitted). If the

district court determines that there was not complete diversity at the time the

complaint was filed, it shall dismiss the action. If the district court determines that

the parties were diverse, it may (but need not) reconsider its summary judgment

ruling in light of subsequent developments in Nevada law. See, e.g., 7510 Perla

Del Mar Ave Tr. v. Bank of Am., N.A., 458 P.3d 348 (Nev. 2020) (en banc).

Neither side shall recover costs.

      VACATED AND REMANDED WITH INSTRUCTIONS.

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