United States District Court, N.D. California
Decided November 30, 2013.
For Juan Manuel Vargas, Hilda Vargas, Plaintiffs: Ephraim Okechukwu Obi, LEAD ATTORNEY, Law Offices of Ephraim O. Obi, Los Angeles, CA; Zachary Alexander Toran, LEAD ATTORNEY, Law Offices of Zachary A. Toran, San Francisco, CA.
For Wells Fargo Bank N.A., also known as Wachovia Mortgage formerly known as Wachovia Mortgage, FSB formerly known as World Savings Bank, Defendant: Elizabeth Christine Hehir, Robert Arthur Bailey, LEAD ATTORNEYS, Robert C. Little, Yaw-Jiun Wu, Anglin Flewelling Rasmussen Campbell & Trytten LLP, Pasadena, CA.
ORDER RE: LACK OF SUBJECT MATTER JURISDICTION
JON S. TIGAR, United States District Judge.
Before the Court is the question of whether a national banking association is a citizen only of the state in which it maintains its " main office," or whether it is also a citizen of the state in which it maintains its principal place of business. Because Plaintiffs are California citizens, and Wells Fargo is incorporated in South Dakota but its prinicipal place of business is in California, the answer to that question will determine whether this action must be remanded to state court.
Plaintiffs Juan Manual Vargas and Hilda Vargas filed this action in San Mateo County Superior Court on March 19, 2012, against Defendants " Wells Fargo Bank, N.A. aka Wachovia Mortgage, a division of Wells Fargo Bank, N.A. and f/k/a Wachovia, Mortgage, FSB formerly known as World Savings Bank, FSR, as beneficiary," and Cal-Western Reconveyance Corp. Wells Fargo removed the action to this Court on April 20, 2012, based on diversity of citizenship pursuant to 28 U.S.C. § § 1332 and 1441. ECF No. 1. The Notice of Removal argued that Cal-Western Reconveyance Corp., a California corporation, was fraudulently joined, and that Wells Fargo is a citizen of South Dakota, whereas Plaintiffs are citizens of California. Id. Defendant Cal-Western Reconveyance Corp. has not appeared in this action, and the record contains no evidence that it has been served. On July 25, 2013, Wells Fargo filed a notice of bankruptcy petition stating that EC Closing Corp., formerly known as Cal-Western Reconveyance Corp., filed a Chapter 11 bankruptcy petition in the District of Delaware, Case No. 13-11619-BLS. The Complaint filed in state court alleges that Cal-Western Reconveyance Corp. is a California Corporation.
Following two motions to dismiss, ECF Nos. 34, 57, Plaintiffs filed their operative Third Amended Complaint on January 10, 2013, ECF No. 64 (" Complaint" ). The Complaint asserts five causes of action arising out of alleged racial discrimination in the modification of a home loan: (1) violation of California's Unfair Competition Law (" UCL" ), Cal. Bus. & Prof. Code § 17200, et seq., (2) common law fraud, (3) injunctive and declaratory relief, (4) negligence, and (5) to set aside the foreclosure sale of Plaintiffs' home.
Wells Fargo moved for summary judgment as to each cause of action on July 11, 2013. Mot., ECF No. 74. After the motion was fully briefed, the Court issued an Order to Show Cause why this case should not be remanded for lack of subject matter jurisdiction because Wells Fargo may be a citizen of California, defeating diversity. ECF No. 92 (citing Martinez v. Wells Fargo Bank, No. 12-cv-6006-EMC, 2013 WL 2237879, 946 F.Supp.2d 1010 (N.D. Cal. May 21, 2013)).
II. LEGAL STANDARD
" Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending." 28 U.S.C. § 1441(a). " If at any time before final judgment, it appears that the district court lacks subject matter jurisdiction, the case shall be ...