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First Federal Bank of California v. Natividad

September 5, 2008


The opinion of the court was delivered by: Gregory G. Hollows United States Magistrate Judge


Defendants John and Florence Natividad, proceeding pro se, filed on August 4, 2008, a Notice of Removal of an unlawful detainer action filed against them in state court. On August 5, 2008, they filed an "amended petition for removal" due to plaintiff having filed a new complaint against them in state court. Also filed by defendants on August 5, 2008 is a motion to dismiss, to which plaintiff (First Federal) filed an opposition. These matters were heard on the court's September 4, 2008 law and motion calendar. Defendants appeared pro se. Earl Wallace appeared for plaintiff. After reviewing the filings and hearing oral argument, the court now issues the following findings and recommendations.*fn1


Defendants were sued in state court in an unlawful detainer action for their refusal to quit and deliver possession of residential real property purchased by plaintiff at a foreclosure sale. In response, defendants petitioners have filed the instant amended petition for removal, alleging new claims, including fraud because plaintiff sold the note and does not have standing here, under 15 U.S.C. § 1611 et seq., 26 U.S.C. § 2605 et seq., 15 U.S.C. § 1602 et seq., and 15 U.S.C. § 1692; civil rights violations in the foreclosure proceedings including substantive and procedural due process under 42 U.S.C. § 1983; and unconstitutional application of Cal. Civ. Code § 2924. Defendants state that they have a complaint against First Federal in state court for fraud. Defendants assert federal question jurisdiction, and seek removal based on the aforementioned grounds.

The motion to dismiss, as amended on August 5, 2008, asserts that the complaint fails to state a cause of action, is uncertain, ambiguous, and unintelligible in that the deed and note fails to state the name of the plaintiff and there is no explanation of how plaintiff obtained the deed and note, and there is no indication of an underlying contract upon which the note and deed are based. Defendants also assert that plaintiff has failed to establish proper service of the notice to vacate.


I. Removal

Defendants bring their petition for removal on the grounds that the complaint does not address their claims of fraud by plaintiff in bringing the unlawful detainer action, civil rights violations in the foreclosure proceedings, and unconstitutional application of Cal. Civ. Code § 2924. Plaintiff contends that removal jurisdiction does not exist because the action could not have been filed in federal court as there is no diversity or federal question jurisdiction, and a counterclaim may not serve as a basis for "arising under" jurisdiction. Plaintiff requests remand to state court.

A district court has an independent duty to examine its own jurisdiction and remand a removed action "since removal is permissible only where original jurisdiction exists at the time of removal or at the time of the entry of final judgment ...." Sparta Surgical Corp. v. National Ass'n. of Securities Dealers, Inc., 159 F.3d 1209, 1211 (9th Cir. 1998), quoting Lexecon, Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26, 43, 118 S.Ct. 956, 966 (1998); FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 229, 110 S.Ct. 596, 606-07 (1990); Harris v. Provident Life and Acc. Ins. Co., 26 F.3d 930, 932 (9th Cir. 1994).

Removal jurisdiction statutes are strictly construed against removal. See Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1979). "Federal 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). "The burden of establishing federal jurisdiction falls on the party invoking removal." Harris v. Provident Life and Accident Ins. Co., 26 F.3d 930 (9th Cir.1994) (quoting Gould v. Mut. Life Ins. Co. of New York, 790 F.2d 769, 771 (9th Cir.1986)).

Defendants invoke the court's jurisdiction under 28 U.S.C. §§ 1331 and 1343, among other statutes. A plaintiff may bring suit in federal court if his claim "arises under" federal law. 28 U.S.C. § 1331. In that situation, the court has original jurisdiction. A defendant cannot invoke the federal court's original jurisdiction. But he may in some instances invoke the court's removal jurisdiction. The requirements to invoke removal jurisdiction are often identical to those for invoking its original jurisdiction. The requirements for both relate to the same end, that is, federal jurisdiction.

Removal of a state court action is proper only if it originally could have been filed in federal court. 28 U.S.C. § 1441. "[F]ederal courts have jurisdiction to hear, originally or by removal, only those cases in which a well-pleaded complaint establishes either that federal law creates the cause of action, or that the plaintiff's right to relief necessarily depends on resolution of a substantial question of federal law." Franchise Tax Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 27-28, 103 S.Ct. 2841, 2855-56 (1983). Mere reference to federal law is insufficient to permit removal. See Smith v. Industrial Valley Title Ins. Co., 957 F.2d 90, 93 (3d Cir. 1992). A defense to an action, based on constitutional rules of general applicability, is not a sufficient basis to remove an action to federal court. See id.; Berg v. Leason, 32 F.3d 422, 426 (9th Cir. 1994) ("[N]either an affirmative defense based on federal law . . . nor one based on federal preemption . . . renders an action brought in state court removable."). Defendants have not shown that they are unable to raise their federal constitutional rights in state court.

This court has no jurisdiction over unlawful detainer actions which are strictly within the province of state court. Defendants' apparent attempt at creating federal subject matter jurisdiction by simply adding claims and defenses to a petition for removal will not succeed. See Catee v. Capital One, F.S.B. 479 F.3d 1143, 1145 (9th Cir. 2007) (even previously asserted counterclaims raising federal issue will not permit removal).

Accordingly, the court finds that remand is appropriate because the case is not one which arises under federal law. Pursuant to 28 U.S.C. ยง 1447(c), where it appears the court lacks subject matter jurisdiction, the court shall make an order for remand. The petition for removal and the state court record filed in this case demonstrate that the underlying proceedings are not ...

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