UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA WESTERN DIVISION
September 12, 2011
DONALD L. MCDAVID, PLAINTIFF,
WELLS FARGO BANK, N.A., FIDELITY NATIONAL TITLE INSURANCE COMPANY, DEFENDANTS.
The opinion of the court was delivered by: Hon. Otis D. Wright, II United States District Judge
Order GRANTING Defendant's Motion to Dismiss  [Filed 08/18/11] and GRANTING Defendant's Motion to Expunge  [Filed 08/18/11] and VACATING Hearing Thereon
Pending before the Court are Defendant Wells Fargo Bank, N.A.'s ("Wells Fargo" or "Defendant") two concurrently-filed Motions: (1) a Motion to Dismiss Plaintiff, Donald L. McDavid's ("Plaintiff") Complaint, and (2) a Motion to Strike/Expunge the Lis Pendens. (Dkt. Nos. 10, 11.) Plaintiff failed to timely oppose the Motions, which may be deemed consent to the granting of the Motions. See L.R. 7-9; L.R 7-12. Nevertheless, the Court has considered Defendant's arguments in support, and for the reasons discussed in the papers, hereby GRANTS both the Motion to Dismiss and the Motion to Expunge. The September 26, 2011 hearing on the matters is VACATED and no appearances are necessary.
On August 11, 2006, to purchase the real property located at 419 E. Mountain Street, Glendale, CA 91207 (the "Property"), Plaintiff, who is a permanent resident of California, executed a loan in the amount of $400,000 (the "Loan"). (Def.'s Request for Judicial Notice ("RJN"), Exh. 1;*fn1 Compl. ¶ 1). The Deed of Trust securing the Loan identifies Wells Fargo as the lender, and Fidelity National Title Insurance Company ("Fidelity"), who is a California corporation with its principal place of business in California, as the trustee.*fn2 (RJN, Exh. 1; RJN, Exh. 6).
On March 18, 2011, due to Plaintiff's default on the Loan in the amount of $11,956.67, Fidelity recorded a Notice of Default. (RJN, Exh. 2). Thereafter, on July 18, 2011, Fidelity foreclosed on the Property. (Compl. ¶ 9). The Property was subsequently sold to Yeganeh Property Group LLC. (RJN, Exh. 5).
In light of the foregoing events, Plaintiff initiated this action for injunctive relief, accounting, monetary relief, and full disclosure. Wells Fargo now brings the instant Motion to Dismiss and Motion to Expunge.
III. LEGAL STANDARD
Federal courts are courts of limited jurisdiction and thus, "have only the power that is authorized by Article III of the Constitution and the statutes enacted by Congress pursuant thereto." Couch v. Telescope, Inc., 611 F.3d 629, 632 (9th Cir. 2010) (quoting Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541 (1986)). A court is required, either by a motion or sua sponte, to dismiss an action if it determines that it lacks subject matter jurisdiction. Fed. R. Civ. P. 12(h)(3); Hertz Corp. v. Friend, 130 S.Ct. 1181, 1193 (2010). Furthermore, "[f]ederal courts must determine they have jurisdiction before proceeding to the merits." Lance v. Coffman, 549 U.S. 437, 439 (2007); Munoz v. Mabus, 630 F.3d 856 (9th Cir. 2010).
Despite the favorable standard generally applied in a motion to dismiss, the burden of establishing federal jurisdiction is on the party invoking federal jurisdiction. United States v. Orr Water Ditch Co., 600 F.3d 1152, 1154 (9th Cir. 2010). However, when considering a Rule 12(b)(1) motion, a court accepts the allegations in the complaint as true and draws all reasonable inferences in plaintiff's favor. Wolfe v. Strankman, 392 F.3d 358, 362 (9th Cir. 2004).
Wells Fargo moves to dismiss the Complaint for lack of subject matter jurisdiction pursuant to Federal Rules of Civil Procedure 12(b)(1) and for failure to state a claim pursuant to Federal Rules of Civil Procedure 12(b)(6). Additionally, Wells Fargo moves to expunge the Lis Pendens recorded in connection with this action. The Court addresses each in turn.
A. THE COURT LACKS SUBJECT MATTER JURISDICTION OVER THE CASE
Pursuant to 28 U.S.C. § 1332, a federal court has diversity jurisdiction over a case if the suit is between citizens of different states, and the amount in controversy exceeds $75,000 exclusive of interests and costs. Geographic Expeditions, Inc. v. Estate of Lhotka, 599 F.3d 1102 (9th Cir. 2010). "Diversity jurisdiction requires complete diversity between the parties-each defendant must be a citizen of a different state from each plaintiff." In re Digimarc Corp. Derivative Litigation, 549 F.3d 1223, 1234 (9th Cir. 2008) (citing Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 267, 2 L.Ed. 435 (1806)). Additionally, pursuant to 28 U.S.C. § 1331, a federal court has original jurisdiction over all civil actions arising under the Constitution, laws, or treaties of the United States.
Here, Plaintiff is a resident of California and Fidelity is a California corporation with its principal place of business in California. (See Compl. ¶ 1; RJN, Exh. 1; RJN, Exh. 6). Consequently, complete diversity of citizenship is lacking. Furthermore, Plaintiff alleges claims for injunctive relief, accounting, monetary relief, and full disclosure. Because none of these claims present a federal question, jurisdiction pursuant to 28 U.S.C. § 1331 is lacking.Accordingly, the Court lacks subject matter jurisdiction over this case and GRANTS Wells Fargo's Motion to Dismiss.
B.MOTION TO EXPUNGE LIS PENDENS
"A lis pendens is a recorded document giving constructive notice that an action has been filed affecting right or title to possession of the real property described in the notice." Pedersen v. Greenpoint Mortgage Funding, Inc., No. S--11--0642 KJM EFB, 2011 WL 3818560, at * 22 (E.D. Cal. Aug. 29, 2011). Under California law, a lis pendens may be expunged on either of two grounds: (1) the pleading on which the lis pendens is based does not contain a real property claim, or (2) the claimant has not shown a probable validity of the claim by a preponderance of the evidence. Cal. Civ. Proc. Code §§ 405.31, 405.32; Justo v. Indymac Bancorp, No. SACV 09-1116 JVS (AGRx), 2010 WL 623715, at *11 (C.D. Cal Feb. 19, 2010). In light of the Court's dismissal of Plaintiff's case for lack of subject matter jurisdiction, there is no basis to maintain a lis pendens. Accordingly, the Court GRANTS the Wells Fargo's Motion to Expunge the Lis Pendens.
Based on the foregoing, the Court GRANTS both Wells Fargo's Motion to Dismiss for lack of subject matter jurisdiction and Wells Fargo's Motion to Expunge the Lis Pendens. The Clerk of the Court shall close this case.
IT IS SO ORDERED.