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Pineda, et al. v. Wells Fargo Bk N.A.

November 30, 2012


The opinion of the court was delivered by: Honorable George H. Wu, United States District Judge



Present: The Honorable GEORGE H. WU, United States District Judge

Javier Gonzalez Not Present Deputy Clerk Court Reporter Attorneys Present for Plaintiffs: Attorneys Present for Defendants: None Present None Present Proceedings: (IN CHAMBERS): ORDER REMANDING ACTION TO STATE COURT

Wells Fargo Bank, N.A. ("Wells") and Mortgage Electronic Registration Systems, Inc. ("MERS") removed this action from Los Angeles County Superior Court on October 26, 2012, asserting that the Court has diversity jurisdiction over this matter. Federal courts are courts of limited jurisdiction, having subject matter jurisdiction only over matters authorized by the Constitution and Congress. See, e.g., Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375, 377 (1994). A "strong presumption" against removal jurisdiction exists. See Gaus v. Miles, Inc., 980 F.2d 564, 567 (9th Cir. 1992). In removing, Wells and MERS bore the burden of proving that jurisdiction exists. See Scott v. Breeland, 792 F.2d 925, 927 (9th Cir. 1986). Subject matter jurisdiction based on diversity of citizenship requires all plaintiffs to have different citizenship(s) from all defendants and that the amount in controversy exceed $75,000. See 28 U.S.C. § 1332; Owen Equip. & Erection Co. v. Kroger, 437 U.S. 365, 373 (1978).

Plaintiffs Arturo and Maria Pineda ("Plaintiffs") are California citizens. See Notice of Removal at 3:1-9. Wells is a national banking association. Id. at 3:11-12. Although the Notice of Removal asserts that there is complete diversity, it alleges Wells's citizenship based only upon the location of Wells's main office, citing to the Supreme Court's decision in Wachovia Bank v. Schmidt, 546 U.S. 303, 313-14 (2006), for the proposition that a national banking association's main office location is its only source of citizenship.

The Notice of Removal contains no allegations concerning the location of Wells's principal place of business. However, this Court recently joined many of its sister courts in holding that Schmidt left open the question of whether a national banking association is a citizen of the state of its principal place of business, in addition to the state of its main office. Mojica v. Wells Fargo Bank, N.A., et al., CV 12-1608-GW-AGR, Docket No. 12. See also Rouse v. Wachovia Mortgage, FSB, No. EDCV 11-00928 DMG (DTBx), 2012 U.S. Dist. LEXIS 6962, at *42 (C.D. Cal. Jan. 13, 2012) (finding that Wells is a citizen both of South Dakota and of California). Further, this Court has held that in the absence of contrary controlling authority*fn1 , the principal place of business of a national banking association does give rise to citizenship for jurisdictional purposes. Mojica, CV 12-1608-GW-AGR, Docket No. 12 at 2 (listing cases holding that a national banking association has the dual citizenship of its main office location and its principal place of business).

The Court notes that many recent cases have found that Wells's principal place of business is in California, which fact has not been disputed by Wells in other litigation in which this issue has arisen, including Mojica. See id. (listing cases where Wells has stipulated or the Court has found that its principal place of business is California). Wells and MERS, who bear the burden of proving that subject matter jurisdiction exists, have not included any allegations that Wells's principal place of business is anywhere other than in California. Given the aforementioned caselaw and the fact that Plaintiffs are California citizens, the Court concludes that the parties in this case are not diverse.

Thus, the Court finds that the allegations in the notice of removal are insufficient to establish the Court's removal jurisdiction by virtue of diversity jurisdiction, and the removing defendants have failed to meet their burden of showing that subject matter jurisdiction exists. The Court hereby remands this action to the Superior Court of Los Angeles County and vacates the motion to dismiss that is presently set for hearing in this Court on December 10, 2012.

The Court further orders the Court Clerk promptly to serve this order on all parties who have appeared in this action.

Clerk's ...

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