ORDER RE DEFENDANT'S MOTION TO DISMISS AND PLAINTIFF'S MOTION TO REMAND
WILLIAM ALSUP, District Judge.
In this foreclosure action, defendant moves to dismiss the complaint for failure to state a claim and preemption. For the reasons stated below, defendant's motion is GRANTED.
Plaintiff Keni Meyer executed a promissory note in 2007, which was secured by a deed of trust, to obtain a home refinance loan from defendant Wells Fargo Bank, N.A.'s predecessor, World Savings Bank, FSB. In March 2010, plaintiff defaulted on her loan after experiencing economic hardship and requested mortgage assistance from defendant. Plaintiff alleges that defendant engaged in "dual-tracking" by initiating foreclosure proceedings while promising to evaluate her request for a loan modification. In fact, plaintiff states that defendant sent her a letter regarding a mortgage modification review as late as April 3, 2013.
According to plaintiff, defendant never concluded its loan modification review. After promising plaintiff that foreclosure proceedings would not be initiated while reviewing her loan modification request, defendant recorded several notices of default and trustee sale. The most recent notice was recorded on April 8, 2013, noticing a May 1, 2013 sale (Compl ¶¶ 12-13, 28, 31, 33-27, 39, 40). Just before the sale date, plaintiff filed for bankruptcy protection under Chapter 7 (RJN, Exh. K). According to the bankruptcy petition, plaintiff does not reside at the subject property. Plaintiff failed to pursue the bankruptcy action, so the bankruptcy trustee filed a report of no distribution and abandoned all assets of the bankruptcy estate (Br. at 1, Dkt. No. 34).
Plaintiff filed this action in the Sonoma County Superior Court on July 1, 2013, alleging (1) breach of contract, (2) fraud, (3) promissory estoppel, (4) negligence, (5) negligent misrepresentation, (6) violation of California's Unfair Competition Law ("UCL"), Section 17200 of the California Business and Professions Code, and (7-8) violations of Sections 2923.6 and 2923.7 of the California Civil Code. Following removal, defendants moved to dismiss the action for failure to state a claim and preemption. In response, plaintiff moved to remand the action back to state court for lack of federal subject-matter jurisdiction.
This order follows full briefing and oral argument. For the reasons stated below, plaintiff's motion to remand is DENIED. Defendant's motion to dismiss is GRANTED.
1. PLAINTIFF'S MOTION TO REMAND.
As a threshold matter, plaintiff argues that removal was improper because there is no federal subject-matter jurisdiction. In her motion to remand, plaintiff admits to being a citizen of the state of California (Br. at 6). She alleges, however, that defendant Wells Fargo "is headquartered and has a its principal place of business in [San Francisco], " which violates the rule of complete diversity for diversity jurisdiction ( ibid. ). Defendant argues in its opposition, however, that its articles of association designate South Dakota as its headquarters (Opp. at 6). Moreover, it argues that its principal place of business is not relevant for diversity jurisdiction.
Under 28 U.S.C. 1348, all national banking associations are "deemed citizens of the States in which they are respectively located." In Schmidt, the United States Supreme Court interpreted Section 1348 to mean that a national banking association is a citizen of the state where its articles of association designate its "main office, " as opposed to being a citizen of every state in which it has a branch office. Wachovia Bank, N.A. v. Schmidt, 546 U.S. 303, 313-14 (2006). The undersigned judge is quite aware that Wells Fargo's actual main office is in San Francisco, rather than in South Dakota. This is a well-known fact. Nonetheless, the undersigned judge is obligated to follow the holding of the United States Supreme Court, which requires this order to identify Wells Fargo's main office as the one designated by its articles of association. Id. at 318. In its articles of association, Wells Fargo designates its main office as the one located in "the City of Sioux Falls, County of Minnehaha, State of South Dakota" (Notice of Removal, Exh. D at 1).
While Schmidt did not actually decide whether a bank's principal place of business should be relied on to determine diversity jurisdiction, the Supreme Court explicitly noted that national banking associations do not fall under Section 1332, which relies on the principal place of business test. Id. at 317 n.9. While our court of appeals has not addressed the issue since Schmidt, a majority of judges in this district, including the undersigned judge, have determined that for purposes of diversity jurisdiction, defendant Wells Fargo is a citizen of only South Dakota, the state in which its main office is located under its articles of association, and not California, where it has its principal place of business. See, e.g., Schmidt v. Wells Fargo Bank, N.A., No. 13-1509, 2013 U.S. Dist. LEXIS 87696, at *5 (N.D. Cal. June 21, 2013); Marquez v. Wells Fargo Bank, N.A., No. 13-2819, 2013 U.S. Dist. LEXIS 131364, at *3-4 (N.D. Cal. Sep. 13, 2013) (Judge Phyllis Hamilton) ; Tse v. Wells Fargo Bank, N.A., No. 10-4441, 2011 U.S. Dist. LEXIS 6796, at *2-8 (N.D. Cal. Jan. 19, 2011) (Judge Thelton Henderson); Atienza v. Wells Fargo Bank, N.A., No. 10-3457, 2011 U.S. Dist. LEXIS 1738, at *3 (N.D. Cal. Jan. 4, 2011) (Judge Richard Seeborg); DeLeon v. Wells Fargo Bank, N.A., 729 F.Supp.2d 1119, 1122 (N.D. Cal. 2010) (Judge Jeremy Fogel). The small minority of decisions in this district that apply the principal place of business test rely on American Surety Co. v. Bank of Cal., 133 F.2d 160 (9th Cir. 1943), a Ninth Circuit decision that pre-dates Schmidt. See, e.g., Vargas v. Wells Fargo Bank N.A., No. 12-2008, 2013 U.S. Dist. LEXIS 113530, at *1 (N.D. Cal. Aug. 12, 2013) (Judge Jon Tigar); Martinez v. Wells Fargo Bank, No. 12-6006, 2013 U.S. Dist. LEXIS 72075, at *6-22 (Judge Edward Chen). Absent binding authority from our court of appeals, this order holds that Wells Fargo is a citizen of only South Dakota. Thus, plaintiff and defendant are completely diverse for the purposes of diversity jurisdiction.
Moreover, the amount in controversy exceeds the $75, 000 threshold required for diversity jurisdiction. In her complaint, plaintiff seeks a "disgorgement of all funds taken from Plaintiff and any profits thereafter derived through use of such funds" (Compl. at 32). Plaintiff admits to making monthly mortgage payments of $2, 932 to defendant for 28 months ( id. ¶¶ 28, 30). Thus, plaintiff is seeking at least $82, 096 in ...