United States District Court, N.D. California, San Jose Division
ORDER DENYING PLAINTIFF'S MOTION TO REMAND [RE:
LABSON FREEMAN, United States District Judge
Christian Wellisch brings this suit, which was originally
filed in state court, against Defendants Pennsylvania Higher
Education Assistance Agency (“PHEAA”) and James
L. Preston (collectively, “Defendants”), claiming
that Defendants failed to comply with the California Military
and Veterans Code (“CMVC”) and the Federal
Servicemembers Civil Relief Act (“SCRA”). See
generally Ex. B to Notice of Removal
(“Compl.”), ECF 1-2. Captain Wellisch's
claims arise out of issues related to PHEAA's servicing
of his student loans while he was on active duty as a
commissioned officer in the California Army National Guard
(“CAARNG”). Id. ¶¶ 8-9, 11.
before the Court is Plaintiff's motion to sever his state
law claims and remand them to state court or, alternatively,
remand the action in its entirety. See generally
Mot., ECF 16. The Court heard argument on this motion on
March 16, 2017. For the reasons stated herein and on the
record, the Court DENIES Plaintiff's motion.
courts have limited subject matter jurisdiction, and may only
hear cases falling within their jurisdiction. Generally, a
defendant may remove a civil action filed in state court if
the action could have been filed originally in federal court.
28 U.S.C. § 1441. The removal statute provides two basic
ways in which a state court action may be removed to federal
court: (1) the case presents a federal question, or (2) the
case is between citizens of different states and the amount
in controversy exceeds $75, 000. See Id.
§§ 1441(a), (b).
removal statutes are construed restrictively to limit removal
jurisdiction. See Shamrock Oil & Gas Corp. v.
Sheets, 313 U.S. 100, 108-09 (1941). The Ninth Circuit
recognizes a “strong presumption against
removal.” Gaus v. Miles, Inc., 980 F.2d 564,
566 (9th Cir. 1992) (internal quotation marks omitted). Any
doubts as to removability should be resolved in favor of
remand. See Matheson v. Progressive Specialty Ins.
Co., 319 F.3d 1089, 1090 (9th Cir. 2003). The defendant
bears the burden of showing that removal is proper. See
Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1117 (9th
Cir. 2004). If at any time before final judgment it appears
that a district court lacks subject matter jurisdiction over
a case that has been removed to federal court, the case must
be remanded. 28 U.S.C. § 1447(c).
the presence of a federal question-Plaintiff's claim
under the SCRA-Captain Wellisch contends that this action, or
at least the state law claims, should be remanded. Plaintiff
asserts three grounds for remand: First, Defendants
improperly removed a separate, nonremovable proceeding. Mot.
2. Second, through removal, Defendants wrongly seek to avoid
the ramifications of their failure to timely file responsive
pleadings. Id. Third, the removal was improper
because Defendants failed to comply with statutory
requirements. Id. Defendants oppose remand.
Opp'n, ECF 28.
one week after filing his multi-claim complaint in state
court, including a claim under CMVC section 409.3, Captain
Wellisch filed a Petition for Relief from Financial
Obligation During Military Service pursuant to CMVC section
409.3. Ex. D to Notice of Removal (“MIL 010
Petition”), ECF 1-4. This document was filed and
associated with Plaintiff's civil case that was pending
in state court. Id.
first argues that because the MIL 010 Petition is an
independent proceeding with particular procedural
requirements that could not have been filed in this Court
originally, it is not removable. Mot. 3-4. Defendants,
however, contend that the MIL 010 Petition is not a separate
proceeding, and is instead a part of his civil case.
to CMVC section 409.3(a),
[a] service member may, at any time during his or her most
current period of military service or within six months
thereafter, petition a court for relief in respect of any
obligation or liability incurred by the service member before
the effective date of the orders for his or her most current
period of military service or in respect of any tax
assessment whether falling due before or during his or her
most current period of military service.
Mil. & Vet. Code § 409.3(a). This section allows a
service member to file a petition for relief separate and
apart from any civil action or as a part of an underlying
lawsuit. See generally Id. The MIL 010 Petition is a
California Judicial Council form specific to claims brought
under CMVC section 409.3. The form includes instructions for
the petitioner and provides notice to the defendant(s) as
required under CMVC section 409.3, i.e., that a
hearing is to be held within 25 days of filing the petition
and that the respondent has until five days before that
hearing in which to file and serve any opposition. Cal. Mil
& Vet. Code § 409.3(b). Here, the state court clerk
set a hearing for January 20, 2017. See MIL 010
previously described, Captain Wellisch filed a complaint in
state court alleging that Defendants' conduct violated
the CMVC and SCRA, as well as claims for unfair business
practices under California's Business and Professions
Code § 17200 and fraudulent concealment. See
generally Compl. Thereafter, Plaintiff filed the MIL 010
Petition in the underlying state action. See MIL 010
Petition. Although Captain Wellisch presumably could have
filed the MIL 010 Petition separate from his underlying state
action, he did not. Now, Plaintiff seeks to sever and remove
his claim under CMVC section 409.3, arguing that it is
separate from the underlying civil action. While Captain
Wellisch correctly recounts the special procedures set forth
in CMVC section 409.3, he provides no authority to support
his assertion that it is to be construed as a proceeding
separate and apart from the underlying civil action when it
is filed in the underlying civil action. Indeed, the Monterey