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Castaneda v. Saxon Mortgage Services

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA


June 3, 2010

CESAR CASTANEDA AND SUZZANNE CASTANEDA, PLAINTIFFS,
v.
SAXON MORTGAGE SERVICES, INC.; NOVASTAR MORTGAGE, INC.; QUALITY LOAN SERVICE CORP.; SYNERGY FINANCIAL MANAGEMENT DBA DIRECT LENDER; THE BANK OF NEW YORK MELLON, AS SUCCESSOR TRUSTEE UNDER NOVASTAR MORTGAGE FUNDING TRUST 2005-2 BY SAXON; MORTGAGE SERVICES, INC.; LOUIS LEON PACIFIC; MICHAEL TIMOSHUCK; IVETTE CAMPOS;, AND DOES 1-20, INCLUSIVE, DEFENDANTS.

ORDER RE: MOTIONS TO DISMISS

Plaintiffs Cesar and Suzzanne Castaneda filed this action against defendants Saxon Mortgage Services, Inc. ("Saxon"), Novastar Mortgage, Inc. ("Novastar"), Quality Loan Service Corp. ("Quality Loan"), Synergy Financial Management, d/b/a Direct Lender ("Synergy"), The New York Bank of Mellon, as successor Trustee under Novastar Mortgage Funding Trust 2005-2 by Saxon ("Mellon"), Louis Leon Pacific, Michael Timoshuck, and Ivette Campos, alleging various state and federal claims relating to a loan they obtained to refinance their home in Sacramento, California. (Docket No. 2.) Plaintiffs asserted that the basis of this court's jurisdiction over the action was federal question jurisdiction, predicated on their claims for violations of the Truth In Lending Act ("TILA"), 15 U.S.C. §§ 1601-1667f, and the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. §§ 2601-2617. (Docket No. 2.)

After the court granted two motions to dismiss plaintiffs' complaint with leave to amend, (Docket Nos. 47, 66), plaintiffs filed a Third Amended Complaint ("TAC") on March 17, 2010, which no longer contains any federal causes of action. (Docket No. 69.) Plaintiffs do not oppose defendants Novastar and Saxon and Mellon's motions to dismiss without prejudice on the grounds that the court should decline to exercise supplemental jurisdiction over plaintiffs' pendant state law claims. (See 72, 79.) The defendants, however, ask the court to retain supplemental jurisdiction over plaintiffs' state law claims and dismiss plaintiff's TAC with prejudice. (See Docket Nos. 71, 73.)

Under 28 U.S.C. § 1367(c) (3), a district court may decline to exercise supplemental jurisdiction over a state law claim if "the district court has dismissed all claims over which it has original jurisdiction . . . ." 28 U.S.C. § 1367(c)(3); see also Acri v. Varian Assocs., Inc., 114 F.3d 999, 1000 (9th Cir. 1997) ("[A] federal district court with power to hear state law claims has discretion to keep, or decline to keep, them under the conditions set out in § 1367(c)."). Factors for a court to consider in deciding whether to dismiss supplemental state claims include judicial economy, convenience, fairness, and comity. Imagineering, Inc. v. Kiewit Pac. Co., 976 F.2d 1303, 1309 (9th Cir. 1992). "[I]n the usual case in which federal law claims are eliminated before trial, the balance of factors . . . will point toward declining to exercise jurisdiction over the remaining state law claims." Reynolds v. County of San Diego, 84 F.3d 1162, 1171 (9th Cir. 1996) overruled on other grounds by Acri, 114 F.3d at 1000.

While it has been over a year since plaintiffs filed their original Complaint in federal court, the case has yet to progress beyond the motion to dismiss stage. As none of the parties have posed any extraordinary or unusual circumstances that would counsel against dismissal, the court will decline to exercise supplemental jurisdiction under § 1367(c)(3) as to the TAC's state law claims.

IT IS THEREFORE ORDERED that plaintiff's Third Amended Complaint be, and the same hereby is, DISMISSED without prejudice.*fn1


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