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Lillian B. Harris, et al. v. Russakow

November 21, 2011


The opinion of the court was delivered by: Honorable John F. Walter, United States District Judge




Shannon Reilly Courtroom Deputy None Present Court Reporter



On July 20, 2011 Plaintiffs Lillian B. Harris, and Joanna Jones and Lillian B. Harris, as Co-Trustees of the Lillian B. Harris Trust ("Plaintiffs") filed a First Amended Complaint against Defendants Russakow, Ryan & Johnson, Russakow, Greene & Tan, LLP, Mark Russakow, Kelly Ryan, Christopher Johnson, Colin Greene, Lisa Tan, Megan Lee, Sergio Rodriguez, Marivel Zialcita, Abraham Apraku, Citibank (South Dakota), N.A., Citicorp Credit Services, Inc. (U.S.A.), and Chase Bank U.S.A., N.A. in Los Angeles Superior Court alleging the following claims for relief:

(1) professional negligence; (2) elder abuse; (3) declaratory judgment; (4) unfair trade practices in violation of Cal. Bus. & Prof. Code § 17200, et seq., (5) negligence; and (6) unfair debt collection practices. On September 14, 2011, Defendants Citibank (South Dakota), N.A. and Citicorp Credit Services, Inc. (USA) ("Removing Defendants") filed a Notice of Removal, alleging that this Court has jurisdiction pursuant to 28 U.S.C. § 1331.

Federal courts are courts of limited jurisdiction, having subject matter jurisdiction only over matters authorized by the Constitution and Congress. See Bender v. Williamsport Area School , 475 U.S. 534, 541 (1986). "Because of the Congressional purpose to restrict the jurisdiction of the federal courts on removal, the statute is strictly construed, and federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance." Duncan v.

, 76 F.3d 1480, 1485 (9th Cir. 1996) (citations and quotations omitted). There is a strong presumption that the Court is without jurisdiction unless the contrary affirmatively appears. See Fifty Associates v. Prudential Insurance Company of America, 446 F.2d 1187, 1190 (9th Cir. 1990). As the party invoking federal jurisdiction, Removing Defendants bear the burden of demonstrating that removal is proper. See, e.g., Gaus v. Miles, 980 F.2d 564, 566 (9th Cir. 1992); Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir. 1988).

Under 28 U.S.C. § 1331, this Court has original jurisdiction over civil actions "arising under" federal law. Removal based on § 1331 is governed by the "well-pleaded complaint" rule. Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987). Under the rule, "federal jurisdiction exists only when a federal question is presented on the face of plaintiff's properly pleaded complaint." Id. Thus, a plaintiff is generally the "master of the claim." Id. There is no federal question jurisdiction simply because there is a federal defense to the claim. Id. The only exception to this rule is where plaintiff's federal claim has been disguised by "artful pleading," such as where the only claim is a federal one or is a state claim preempted by federal law. Sullivan v. First Affiliated Sec., Inc., 813 F. 2d 1368, 1372 (9th Cir. 1987).

"Congress has given the lower federal courts jurisdiction to hear, originally or by removal from a state court, 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 Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 27-28 (1983). The "well-pleaded complaint" rule "severely limits the number of cases in which state law 'creates the cause of action' that may be initiated in or removed to federal district court." Id. at 9-10. A case may arise under federal law "where the vindication of a right under state law necessarily turned on some construction of federal law." Id. at 9. "[F]ederal jurisdiction demands not only a contested federal issue, but a substantial one, indicating a serious federal interest in claiming the advantages thought to be inherent in a federal forum." Grable & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 313 (2005).

The absence of a federal cause of action is a relevant factor to be considered in assessing whether a federal issue is substantial. Id. at 318; Merrell Dow Pharm. Inc. v. Thompson, 478 U.S. 804, 811-12 (1986). Merely using the potential violation of a federal statute to form part of the basis for a state law cause of action does not transform the cause of action into a federal claim.

, 478 U.S. at 811-12. Such references to federal violations to support state law causes of action do not ...

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