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Nieto v. Lantana Community Association, Inc.

United States District Court, E.D. Texas, Sherman Division

August 1, 2019




         Came on for consideration the report of the United States Magistrate Judge in this action, this matter having been heretofore referred to the United States Magistrate Judge pursuant to 28 U.S.C. § 636. On June 5, 2019, the Magistrate Judge entered her report (Dkt. #20) containing proposed findings of fact and recommendations that Plaintiff Lucia J. Nieto's Motion to Remand (Dkt. #13) be granted. Having received the report and recommendation of the Magistrate Judge and after considering Defendant Lantana Community Association, Inc.'s objections (Dkt. #21), the Court rejects the Magistrate Judge's report and finds that Plaintiff's motion to remand should be denied.


         Plaintiff filed this foreclosure and mortgage case on December 28, 2017, in the 393rd Judicial District Court of Denton County, Texas (Dkt. #1). In her Original Petition, Plaintiff sought a declaratory judgment, temporary restraining order, temporary injunction, and asserted claims for wrongful foreclosure, breach of contract, and to quiet title (Dkt. #1-4). Although Plaintiff alleged that she was not properly served under certain rules and provisions of the Texas Rules of Civil Procedure and Texas Property Code, Plaintiff did not assert a federal cause of action or allege any facts relating to a federal question in her Original Petition (See Dkt. #1-4 ¶¶ 14, 17, 22, 26, 36).[1]

         On January 30, 2019, Plaintiff filed two motions in the state court: (1) Plaintiff's Traditional Motion for Partial Summary Judgment Against Defendants Fannin 900 Land Trust and TFHSP, LLC (Dkt. #13-3) and (2) Plaintiff's Motion for Leave to File Supplemental Petition (Dkt. #13-2). In her motion for summary judgment, Plaintiff argued, “Because Movant was not served with process in the foreclosure action and given the opportunity to cure, Movant's due process rights under the Texas and United States Constitution[s] were violated and the default judgment rendered against Movant is void.” (Dkt. #13-3 at p. 2). In her motion for leave, Plaintiff stated, “this suit implicates Movant's due process rights under the State and Federal constitutions. Out of an abundance of caution, Movant seeks to file a supplemental petition to makes explicitly clear that her constitutional rights to due process have been violated.” (Dkt. #13-2 at p. 1). On February 22, 2019, Plaintiff filed a Motion for Continuance, Objections and Response to Defendant Lantana Community Association, Inc's Traditional and First Supplement (sic) Motion for Summary Judgment (Dkt. #13-4). In this filing, Plaintiff again alleged that Defendant violated her federal due process rights (Dkt. #13-4 ¶¶ 4, 21, 24, 26). In reply to Plaintiff's argument, Defendant contended that Plaintiff could not invoke a constitutional claim against a homeowner's association (Dkt. #13-5 at pp. 7-8). Defendant did not remove the case within 30 days of any of these filings.

         On March 1, 2019, the state court granted Plaintiff's Motion for Leave to File Supplemental Petition (Dkt. #1-36). Defendant removed the case on March 29, 2019-within 30 days of the state court granting Plaintiff's motion for leave (Dkt. #1). On April 3, 2019, Plaintiff filed her motion to remand arguing that Defendant failed to timely remove the case (Dkt. #13). Defendant filed a response to the motion on April 15, 2019 (Dkt. #16). Plaintiff filed a reply in support of the motion on April 22, 2019 (Dkt. #19).

         On June 5, 2019, the Magistrate Judge issued her Report and Recommendation recommending that the undersigned grant Plaintiff's motion to remand as Defendant did not timely remove the case (Dkt. #20). Specifically, the Magistrate Judge characterized Plaintiff's motion for leave as a “motion” or “other paper” under 28 U.S.C. § 1446(b)(3) (Dkt. #20 at p. 7). Therefore, the Magistrate Judge found that the 30-day removal clock began on January 30-the day Plaintiff file her motion for leave-instead of March 1-the day the state court granted Plaintiff's motion for leave (See Dkt. #20 at p. 7).

         On June 19, 2019, Defendant filed its objections to the Magistrate Judge's Report and Recommendation (Dkt. #21). Defendant objects to the Magistrate Judge's interpretation of § 1446(b)(3) and contends that Defendant could not have ascertained that the case was removable until the state court granted Plaintiff's motion for leave. Therefore, Defendant contends the 30-day removal clock did not start until March 1.


         A party who files timely written objections to a magistrate judge's report and recommendation is entitled to a de novo review of those findings or recommendations to which the party specifically objects. 28 U.S.C. § 636(b)(1)(C); Fed.R.Civ.P. 72(b)(2)-(3). “Federal courts are courts of limited jurisdiction, possessing only that power authorized by Constitution and statute.” Gunn v. Minton, 568 U.S. 251, 256 (2013) (quoting Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)). “Only state court actions that originally could have been filed in federal court may be removed to federal court by the defendant.” Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987) (citing 28 U.S.C. § 1441(a)). “In an action that has been removed to federal court, a district court is required to remand the case to state court if, at any time before final judgment, it determines that it lacks subject matter jurisdiction.” Humphrey v. Tex. Gas Serv., No. 1:14-CV-485, 2014 WL 12687831, at *2 (E.D. Tex. Dec. 11, 2014) (citations omitted). The Court “must presume that a suit lies outside [its] limited jurisdiction, ” Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001), and “[a]ny ambiguities are construed against removal and in favor of remand to state court.” Mumfrey v. CVS Pharmacy, Inc., 719 F.3d 392, 397 (5th Cir. 2013) (citing Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002)). “When considering a motion to remand, the removing party bears the burden of showing that federal jurisdiction exists and that removal was proper.” Humphrey, 2014 WL 12687831, at *2 (quoting Manguno, 276 F.3d at 723).


         The issue here is whether Defendant timely removed the case to this Court. To begin, the Court must decide whether the case was initially removable. If the case was not initially removable, the Court must then determine when the case became removable.

         I. The Original Petition

         Defendant could not have removed the Original Petition pursuant to 28 U.S.C. § 1331 as the Original Petition did not contain a federal question.[2] Federal jurisdiction is authorized by Constitution or statute. Gunn, 568 U.S. at 256 (quoting Kokkonen, 511 U.S. at 377). One statute, 28 U.S.C. § 1331, authorizes “federal question” jurisdiction over “all civil actions arising under the Constitution, laws, or treaties of the United States.” To determine whether federal question jurisdiction exists, courts apply the “well-pleaded complaint” rule. The well-pleaded complaint rule “provides that federal jurisdiction exists only when a federal question is ...

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