The opinion of the court was delivered by: Irma E. GONZALEZUnited States District Judge
(1) GRANTING PLAINTIFFS'
MOTION TO PROCEED
FORMA PAUPERIS; AND
[Doc. No. 2]
(2) DENYING WITHOUT
PREJUDICE MOTION FOR WITHDRAWAL OF REFERENCE Doc. No.1]
On June 11, 2012, Plaintiffs Steven Harry Lucore, Sr. and Judy Lynne Lucore ("Plaintiffs"), proceeding pro se, filed a document entitled "Removal/Transfer and Memorandum of Law in Support of Transfer/Removal of Bankruptcy Case No. 11-14196-PB13." [Doc. No. 1.] The Court construes this filing as a motion for withdrawal of reference to bankruptcy court pursuant to 28 U.S.C. § 157(d).*fn1 Along with their motion, Plaintiffs submitted a motion to proceed in forma pauperis. [Doc. No. 2.] Having considered Plaintiffs' submissions, the Court GRANTS Plaintiffs leave to proceed in forma pauperis, but DENIES WITHOUT PREJUDICE Plaintiffs' motion for withdrawal of reference.
On August 25, 2011, Debtor Plaintiffs filed a voluntary Chapter 13 bankruptcy case. In re Lucore, No. 11-14196-PB13 (S.D. Cal., filed Aug. 25, 2011 [Doc. No. 1]). On June 11, 2012, the same day Plaintiffs filed their motion for withdrawal, Plaintiff filed an adversary complaint in the bankruptcy court against Defendants Guild Mortgage Company, Guild Administration Corporation, Mortgage Electronic Registration Systems, Inc., Terry W. Lewis, Teresita Callejas, Rhonda M. Kaninau, Gail Windus, Paul Laboda, Claudia Cappio, and Does 1-20. Lucore v. Guild Mortg. Co., No. 12-90193-PB (S.D. Cal., filed Mar. 16, 2011 [Doc. No. 1]). The complaint asserts various causes of action for (1) breach of contract; (2) civil rights violations; (3) mortgage fraud; (4) the recordation of fraudulent documents; (5) violation of 18 U.S.C. § 1341; (6) violation of 18 U.S.C. § 1001; (7) constitutional violations; (8) violation of 15 U.S.C. § 1641; (9) mortgage fraud for counterfeiting; and (10) declaratory and injunctive relief. Id. The complaint demands a jury trial. Id.
On July 9, 2011, the defendants in the adversary proceeding filed a motion to dismiss Plaintiff's adversary complaint. Id. ([Doc. No. 6.]). A hearing on the motion to dismiss is currently scheduled for August 27, 2012 at 10:00 a.m. before the bankruptcy court. Id. ([Doc. No. 7.]). By the present motion, Plaintiffs seek withdrawal of the reference from the bankruptcy court to this Court. [Doc. No. 1.]
I. MOTION TO PROCEED IN FORMA PAUPERIS
All parties instituting any civil action, suit, or proceeding in a district court, except an application for writ of habeas corpus, must pay a filing fee of $350. See 28 U.S.C. § 1914(a); see, e.g., Meyers v. Textron Fin. Corp., 2011 U.S. Dist. LEXIS 101190, at *15-16 (N.D. Tex. Sept. 7, 2011) (requiring party filing a motion for withdrawal of reference to pay filing fee); Control Ctr. L.L.C. v. Lauer, 288 B.R. 269, 271 (M.D. Fla. 2002) (same). However, an action may proceed despite failure to pay the filing fee if the party is granted in forma pauperis ("IFP") status. See Rodriguez v. Cook, 169 F.3d 1176, 1177 (9th Cir. 1999). The Court may grant IFP status to any party who demonstrates that he or she is unable to pay such fees or give security therefor. 28 U.S.C. § 1915(a).
In the present case, having reviewed Plaintiffs' motion to proceed IFP and the declaration in support of the motion, the Court finds that Plaintiffs have made a sufficient showing of inability to pay the required filing fees. See Rodriguez, 169 F.3d at 1177. Accordingly, good cause appearing, the Court GRANTS Plaintiffs leave to proceed in forma pauperis.
II. MOTION FOR WITHDRAWAL OF REFERENCE
Federal courts have original jurisdiction over civil proceedings arising in or related to bankruptcy cases. 28 U.S.C. § 1334(a); In re McGhan, 288 F.3d 1172, 1179 (9th Cir. 2002). Under 28 U.S.C. § 157(a), a district court may refer any or all such bankruptcy matters to a bankruptcy judge. See In re Harris, 590 F.3d 730, 736 (9th Cir. 2009). Bankruptcy judges have jurisdiction to "hear and determine all cases under title 11 and all core proceedings arising under title 11, or arising in a case under title 11." 28 U.S.C. § 157(b). However, a district court may withdraw cases arising under title 11--or matters within those cases--from the bankruptcy courts "on its own motion or on timely motion of any party, for cause shown." 28 U.S.C. § 157(d); accord. Vacation Vill., Inc. v. Clark Cnty., 497 F.3d 902, 914 (9th Cir. 2007). Under § 157(d), a reference to the bankruptcy court may be subject to a permissive or mandatory withdrawal, depending on the circumstances. In re Estate Fin. Mortg. Fund, LLC, 2011 U.S. Dist. LEXIS, at *4 (C.D. Cal. Sept. 9, 2011).
The burden of proving that withdrawal is appropriate is on the party seeking withdrawal. In re First Alliance Mortg. Co., 282 B.R. 894, 902 (C.D. Cal. 2001). A district court's decision to withdraw a reference is reviewed for abuse of discretion. Sec. Farms v. Int'l Bhd. of Teamsters, ...