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Meredith L. Manzano, An v. Metlife Bank N.A.

May 24, 2011



Plaintiff Meredith L. Manzano brought this action against defendants MetLife Bank, N.A. ("MetLife"), Quality Loan Service Corp. ("Quality Loan"), and Donn Steier, Inc. dba Sierra Mortgage ("Sierra Mortgage"), arising out of defendants' allegedly wrongful conduct relating to a residential loan agreement. Presently before the court are plaintiff's motion to remand and Metlife's motions to dismiss plaintiff's Second Amended Complaint ("SAC") pursuant to Federal Rule of Civil Procedure 12(b)(6) and to strike plaintiff's SAC pursuant to Rule 12(f).

I. Factual and Procedural Background

Plaintiff is the owner of real property located at 168 Beaver Trail in Mammoth Lakes, California. (SAC ¶ 7 (Docket No. 14).) In July of 2008, First Horizon Home Loans recorded a Deed of Trust on the property with the Mono County Recorder's Office as security for a loan for $417,000.00. (Def.'s Req. for Judicial Notice Ex. 1 (Docket No. 18); see SAC ¶ 8.)

On April 28, 2009, MetLife filed a Corporate Reassignment of Deed of Trust with the Mono County Recorder's Office, which stated that First Horizon Home Loans conveyed the Deed of Trust on plaintiff's home to Metlife. (Def.'s Req. for Judicial Notice Ex. 2.) Plaintiff alleges, however, that MetLife is not the true owner of the Deed of Trust and underlying indebtedness. (SAC ¶ 29.)

Plaintiff apparently missed at least one loan payment, as on July 8, 2010, plaintiff received a letter from MetLife regarding the possibility of loan modification following plaintiff's "failure to pay." (SAC ¶ 28.) Plaintiff then allegedly called the loss mitigation department of MetLife and spoke to a representative who told plaintiff to stop making regular payments in order to qualify for a loan modification. (Id. ¶ 31.) The representative allegedly told plaintiff that her credit would not be affected during the process as long as she provided MetLife with the required financial information for the modification. (Id. ¶ 32.)

Plaintiff allegedly made a Qualified Written Request ("QWR") to MetLife on November 16, 2010. (Id. ¶ 88.) She received no response. (Id.) MetLife has allegedly recorded a Notice of Default and Notice of Trustee's Sale on plaintiff's home but has not yet foreclosed. (Id. ¶¶ 10-11.)

On December 21, 2010, plaintiff filed suit in the Superior Court of the County of Mono against MetLife and Quality Loan, asserting both state and federal claims. (Notice of Removal ¶ 1 (Docket No. 1).) On February 22, 2011, plaintiff filed a First Amended Complaint in state court, adding another federal claim against MetLife. (John Manzano Decl. in Supp. of Mot. to Remand ¶ 12 (Docket No. 9).) The parties dispute whether and when MetLife was properly served with the Complaint or First Amended Complaint in state court.

On March 9, 2011, MetLife removed the action to this court on the basis of both diversity and federal question jurisdiction.*fn1 (Notice of Removal ¶¶ 7-12.) Plaintiff then filed her SAC in this court on April 12, 2011, adding a state law claim against MetLife and Sierra Mortgage, which had not previously been a party. (Docket No. 14.) The SAC states claims against MetLife for slander of title and quiet title, fraud, negligent misrepresentation, bad faith, wrongful foreclosure, violation of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §§ 1692-1692p, violation of the Real Estate Settlement Procedures Act ("RESPA"), 12 U.S.C. §§ 2601-2617, and predatory lending under California Financial Code sections 4970-4979.8.*fn2

II. Discussion

A. Motion to Remand

Plaintiff moves to remand this action to state court on the grounds that removal was untimely, MetLife waived its right to remove by taking substantial action in state court, MetLife failed to obtain the requisite consent to remove from Sierra Mortgage, and this court does not have jurisdiction under 28 U.S.C. § 1332. (Pl.'s Mot. to Remand (Docket No. 8).)

A motion to remand a case on the basis of any defect other than lack of subject matter jurisdiction must be made within thirty days after the filing of the notice of removal under 28 U.S.C. § 1446(a). 28 U.S.C. § 1447(c); Pavone v. Miss. Riverboat Amusement Corp., 52 F.3d 560, 566 (5th Cir. 1995). "Federal courts strictly observe the thirty-day deadline for filing motions to remand." Alter v. Bell Helicopter Textron, Inc., 944 F. Supp. 531, 535 (S.D. Tex. 1996) (citing In re Shell Oil Co., 932 F.2d 1518, 1522-23 (5th Cir. 1991) (holding that remand was precluded when the motion to remand was filed thirty-four days after the removal notice); Elder v. Wal-Mart Stores, Inc., 751 F. Supp. 639, 640 (E.D. La. 1990) (thirty-one days)); see also Borchers v. Standard Fire Ins. Co., No. C-10-1706, 2010 WL 2608291, at *1 (N.D. Cal. June 25, 2010) (thirty-one days); Ramos v. Quien, 631 F. Supp. 2d 601, 608 (E.D. Pa. 2008) (thirty-one days).

MetLife filed its notice of removal with this court on March 9, 2011, which gave plaintiff until April 8, 2011, to move to remand.*fn3 Plaintiff did not file her motion to remand until April 11, 2011.*fn4 Accordingly, plaintiff's motion was untimely. Because the thirty-day limitation for a motion to remand on procedural grounds also limits a court's authority to remand a case sua sponte on such grounds, Maniar v. F.D.I.C., 979 F.2d 782, 785 (9th Cir. 1992) (court may not consider plaintiff's untimely argument that removal was untimely), the court will not consider whether MetLife's removal was procedurally defective.

However, the court must still consider whether it has subject matter jurisdiction over the action. See 28 U.S.C. § 1447(c) ("If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded."). Plaintiff has brought federal claims under the FDCPA and RESPA. Because the court has federal question jurisdiction, 28 U.S.C. § 1331, the court need not consider plaintiff's argument regarding diversity jurisdiction. Accordingly, plaintiff's motion to remand will be denied.

B. Motion to Strike

MetLife moves to strike plaintiff's SAC on the ground that she filed it without leave of court. A plaintiff is allowed to amend her complaint once as a matter of course. Fed. R. Civ. P. 15(a). "When a state court action is removed to federal court, the removal is treated as if the original action has been commenced in federal court." Schnabel v. Lui, 302 F.3d 1023, 1037 (9th Cir. 2002); see also Butner v. Neustadter, 324 F.2d 783, 785 (9th Cir. 1963) ("The federal court takes the case as it finds it on removal and treats everything that occurred in the state court as if it had taken place in federal court.") (footnote omitted).

Because plaintiff filed her First Amended Complaint in state court prior to removal to this court, plaintiff already amended her pleading once as a matter of course. Thus, she could not properly file the SAC without first obtaining leave of court. Howell v. City of Fresno, No. CV-F-07-371 OWW TAG, 2007 WL 1501844, at *2 (E.D. Cal. May 23, 2007); see also Yazdanpanah v. Sacramento Valley Mortg. Grp., No. C 09-02024, 2009 WL 4573381, at *1 (N.D. Cal. Dec. 1, 2009).

However, even when a pleading is improperly filed, the court may choose not to strike the pleading in the interests of judicial economy. See Telles v. Stanislaus Cnty., No. 1:10-cv-01911 AWI JLT, 2011 WL 643358, at *1 n.1 (E.D. Cal. Feb. 17, 2011); Roybal v. Equifax, No. 2:05-cv-01207 MCE KJM, 2008 WL 4532447, at *14 n.12 (E.D. Cal. Oct. 9, 2008); Chang Heum Lee v. Cnty. of Kern, No. CV-F-07-1337 LJO SMS, 2007 WL 4372838, at *3 (E.D. Cal. Dec. 12, 2007); Rhodes v. Elec. Data Sys. Corp., No. CIV S-06-1715 MCE EFB, 2007 WL 1988750, at *1 n.2 (E.D. Cal. July 3, 2007); Sapiro v. Encompass Ins., 221 F.R.D. 513, 517 (N.D.Cal. 2004). This is often true when "leave to amend would have been granted had it been sought and when it does not appear that any of the parties will be prejudiced by allowing the change." Charles Alan Wright et al., Federal Practice & Procedure ยง 1484 (3d ed. 2010) (observing that ...

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