United States District Court, N.D. Texas, Dallas Division
MEMORANDUM OPINION & ORDER
J. BOYLE UNITED STATES DISTRICT JUDGE.
the Court is Plaintiffs' Motion to Remand. Doc. 7. For
the reasons that follow, the Court GRANTS the motion.
plaintiffs Harold and Rosetta McGee (the McGees) ask the
Court to remand their case, claiming the Court does not have
subject matter jurisdiction because they assert only
state-law causes of action in their complaint. Doc. 7, Mot.
to Remand, 1. The McGees filed suit in Texas state court
claiming that Defendants the Veterans Land Board of the State
of Texas (VLB) and Citimortgage, Inc. (Citimortgage)
unlawfully accelerated the payments due under their mortgage
and unlawfully scheduled a foreclosure sale of the
McGees' home. Doc. 1-6, Compl., ¶ 13. When the
McGees purchased their home they executed a promissory note
and a deed of trust with non- defendant CTX Mortgage Company
L.L.C. (CTX). Id., ¶ 19. CTX assigned the note
and deed of trust to Citimortgage, which in turn assigned the
note and deed of trust to VLB. Id. The deed of trust
incorporates federal regulations promulgated by the Secretary
of Housing and Urban Development (HUD) that dictate, in
relevant part, the circumstances under which a lender may
accelerate a note and initiate foreclosure proceedings.
Id., ¶¶ 21-23. Specifically, paragraph
9(d) of the deed of trust incorporates 24 C.F.R. §
203.501 and 24 C.F.R. §§ 203.604-606. Id.
The McGees claim that Defendants breached the deed of trust
when they violated these provisions by failing to send a
letter of default, conduct a face-to-face interview with
them, and complete a loss mitigation evaluation before
initiating a foreclosure sale. Id. The McGees claim
also that Defendants breached the deed of trust by violating
Texas Property Code § 51.002(d) and the duty of good
faith and fair dealing imposed by Texas law. Id.,
¶¶ 31-32. In addition to their breach of contract
claim, the McGees seek to quiet title, a declaratory judgment
that the notices of acceleration and foreclosure sale are
invalid, specific performance of Defendants' duty to
provide loss mitigation options under the deed of trust, and
an accounting of all transactions relating to their mortgage
pursuant to the Real Estate Settlement Procedures Act
(RESPA). Id., ¶¶ 37, 40, 42, 44, prayer
timely removed the case to this Court on the basis of federal
question jurisdiction under 12 U.S.C. § 1331 and §
1441. Doc. 1, Notice of Removal, 1. The McGees then filed a
motion to remand. Doc. 7, Mot. to Remand. The same day, the
McGees voluntarily dismissed VLB from the case. Doc. 9,
Notice. Citimortgage claims in its response to the motion to
remand that not only does the Court have federal-question
jurisdiction over the case, it now also has diversity
jurisdiction since VLB, an in-state defendant and Texas
citizen, was voluntarily dismissed. Doc. 10, Def.'s
Resp., 5-7. The McGees did not file a reply, but the time has
passed for them to do so. Thus, their motion to remand is
ripe for review.
to remand are governed by 28 U.S.C. § 1447(c), which
provides that “[i]f at any time before final judgment
it appears that the district court lacks subject matter
jurisdiction, the case shall be remanded.” 28 U.S.C.
§ 1447(c). When considering a motion to remand,
“[t]he removing party bears the burden of showing that
federal jurisdiction exists and that removal was
proper.” Manguno v. Prudential Prop. & Cas.
Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002).
Furthermore, “any doubt about the propriety of removal
must be resolved in favor of remand.” Gasch v.
Hartford Accident & Indem. Co., 491 F.3d 278, 281-82
(5th Cir. 2007).
federal removal statute permits a defendant to remove any
civil action that falls within the original jurisdiction of
the district courts. 28 U.S.C. § 1441(a). Original
jurisdiction lies when there is federal-question jurisdiction
or diversity jurisdiction. In its notice of removal,
Citimortgage claims only that the Court has federal-question
jurisdiction. But it now claims the Court also has diversity
jurisdiction. Thus, the Court will consider both standards.
district court has federal-question jurisdiction over
“all civil actions arising under the Constitution,
laws, or treaties of the United States.” 28 U.S.C.
§ 1331. The most direct way a case arises under federal
law is “when federal law creates the cause of action
asserted.” Gunn v. Minton, 568 U.S. 251, 257
(2013). But there is a backdoor to federal court reserved for
a “small and special” group of state-law claims.
Empire Health choice Assurance, Inc. v. McVeigh, 547
U.S. 677, 699 (2006). “That is, federal jurisdiction
over a state law claim will lie if a federal issue is: (1)
necessarily raised, (2) actually disputed, (3) substantial,
and (4) capable of resolution in federal court without
disrupting the federal-state balance approved by
Congress.” Gunn, 568 U.S. at 258.
courts also have original jurisdiction over “all civil
actions where the matter in controversy exceeds the sum or
value of $75, 000 . . . and is between . . . citizens of
different States.” 28 U.S.C. § 1332(a)(1). Removal
is only proper in such cases, however, if there is complete
diversity of citizenship among the parties at the time the
complaint is filed and at the time of removal. Mas v.
Perry, 489 F.2d 1396, 1398-99 (5th Cir. 1974). Moreover,
none of the parties properly joined and ...