United States District Court, E.D. Texas, Sherman Division
KAREN F. NEWTON REVOCABLE TRUST, et al., Plaintiffs,
CANADIAN REAL ESTATE HOLDINGS, LP, Defendant.
MEMORANDUM OPINION AND ORDER
KIMBERLY C. PRIEST JOHNSON UNITED STATES MAGISTRATE JUDGE.
before the Court is Plaintiffs' Motion to Remand (the
“Motion”) (Dkt. 10). Defendant filed a response
(Dkt. 15), Plaintiffs filed a reply (Dkt. 19), and Defendant
filed a surreply (Dkt. 20). For the reasons set forth below,
the Motion (Dkt. 10) is GRANTED IN PART and DENIED IN
13, 2019, Plaintiffs Karen F. Newton Revocable Trust and the
Individual Plaintiffs filed suit in the 296th
Judicial District Court of Collin County, Texas, asserting
state law claims for temporary and permanent injunctive
relief related to the enforcement of restrictive covenants
contained in deed restrictions filed in real property records
of Collin County. See Dkt. 3. On June 10, 2019,
Plaintiffs filed a First Amended Original Petition, but did
not assert a federal cause of action as a part of the
amendment. See Dkt. 4. On June 10, 2019, Defendant
Canadian Real Estate Holdings, LP, filed a Notice of Removal
(Dkt. 1) alleging the Court has original jurisdiction over
the case based on federal interest jurisdiction. Though not
specifically stated as a basis for removal in the Notice of
Removal, Defendant cited a number of cases related to the
importance of the Fair Housing Act. See Dkt. 1 at
3-4. Plaintiffs moved to remand and Defendant responded,
contending the case should remain in federal court because it
involves an important federal interest related to the Fair
Housing Act. See Dkt. 15 at 4.
district courts are courts of limited jurisdiction and may
hear only those cases authorized by a federal statute, the
Constitution, or U.S. treaty. Kokkonen v. Guardian Life
Ins. Co., 511 U.S. 375, 377 (1994); Howery v.
Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001).
The federal removal statute provides that “[e]xcept as
otherwise expressly provided . . . any civil action brought
in a State court of which the district courts . . . have
original jurisdiction, may be removed by the defendant or
defendants, to the district court . . . for the district and
division embracing the place where such action is
pending.” 28 U.S.C. § 1441(a); see
Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987).
matter jurisdiction in federal court is generally conferred
through either: (1) federal question jurisdiction under 28
U.S.C. §1331; or (2) diversity of citizenship
jurisdiction under 28 U.S.C. §1332. In cases where an
action originally filed in state court is removed to federal
court, it is well settled that the removing party has the
burden of proof to establish a federal court's
jurisdiction. Gasch v. Hartford Accident & Indem.
Co., 491 F.3d 278, 281 (5th Cir. 2007); De Aguilar
v. Boeing Co., 11 F.3d 55, 58 (5th Cir. 1993);
Jernigan v. Ashland Oil Inc., 989 F.2d 812, 815 (5th
Cir. 1993); MD Matrix Health, L.L.C. v. Kasle, 2012
WL 6161941, at *2 (E.D. Tex. Nov. 5, 2012), report and
recommendation adopted, 2012 WL 6161840 (E.D. Tex. Dec. 10,
2012). When reviewing removal, a court is required to
strictly construe the removal statute in favor of remand and
against removal. 28 U.S.C. § 1447; In re Hot-Hed
Inc., 477 F.3d 320, 323 (5th Cir. 2007). Only
state-court actions that originally could have been filed in
federal court may be removed to federal court by the
defendant. See Williams, 482 U.S. at 392 (1987).
has not asserted diversity of citizenship as a basis for
removal. See Dkt. 15 at 8. Rather, Defendant's
sole basis for the Court's jurisdiction is federal
interest jurisdiction. See id. Plaintiffs argue the
case does not involve a federal question. See Dkt.
10 at 1. Plaintiffs filed this case in Texas State Court,
asserting state law claims for temporary and permanent
injunctive relief and declaratory judgment pursuant to the
Uniform Declaratory Judgment Act. See Dkt. 3.
Plaintiffs do not assert any cause of action under federal
law. See id. Nevertheless, Defendant contends the
Court has jurisdiction because Plaintiffs' claims raise
“a substantial and serious federal interest
(i.e. [h]ousing for the handicapped).” Dkt. 15
at 2. Defendant relies on Clauer v. Heritage Lakes
Homeowners Ass'n, Inc., for the proposition that the
Court has jurisdiction simply because there is an
“important federal interest at the core of this
[c]ase.” Id.; No. 4:09-CV-560, 2010 WL 446545,
at *4 (E.D. Tex. Feb. 3, 2010). Clauer fell into a
“special and small category” of cases where state
law claims turn on substantial questions of federal law.
See Clauer, 2010 WL 446545, at *2 (citing Empire
Healthchoice Assur., Inc. v. McVeigh, 547 U.S. 677, 699
(2006)). In Clauer, the plaintiffs sought a
declaration regarding entitlement to protections of the
Servicemembers Civil Relief Act (“SCRA”)-a
federal law-and other issues specifically related to the
SCRA. See id. Moreover, in Clauer, the
plaintiffs did not contest that resolving a federal issue was
necessary to resolution of their state-law claim, and the
federal issue was actually disputed. See id. at *3.
The plaintiffs in Clauer contested that the case
involved a substantial question of federal law solely because
the SCRA did not provide a private remedy. See id.
The court found that the plaintiffs' claim raised a
significant federal interest:
Plaintiffs' entire case is based on a federal law, the
SCRA. Plaintiffs' rights asserted in this action were
created by federal law and require the Court to interpret a
federal law. The Court will have to determine whether Mrs.
Clauer is entitled to the protection under the SCRA. This is
an important question of law. Moreover, the question whether
Mrs. Clauer is entitled to protection under the SCRA is the
preliminary element of Plaintiffs' claims. Federal law is
not “tangentially relevant” to Plaintiffs'
state claims but rather their claims would not exist without
the SCRA. Thus, Plaintiffs' claims turn on answers to
federal statutory questions.
present case is readily distinguishable. Plaintiffs do not
assert a claim seeking a declaration or protection under
federal law. Plaintiffs do not seek interpretation of a
federal law. To the contrary, Plaintiffs' claims asserted
in accordance with a Texas statute would exist without
federal law. Even if a plaintiff may have asserted a claim
under federal law, a plaintiff may forego relief based on
federal law and choose to rely exclusively on state law.
See Williams, 482 U.S. at 392 (1987) (stating that a
plaintiff is “the master of the claim; he or she may
avoid federal jurisdiction by exclusive reliance on state
law”); see also Gemcraft Homes, Inc. v.
Sumurdy, 688 F.Supp. 289, 292 (E.D. Tex. 1988)
(“[T]he plaintiff is the master of his complaint and
may rely exclusively on state law and prevent removal to
federal court unless some other doctrine provides a basis for
removal. . . . This court will not hold that plaintiff has
stated a claim for copyright infringement simply because it
is available from the facts set out in the
contends that for Plaintiffs to prevail on their requested
relief, they must prevail on Defendant's affirmative
defense under the federal Fair Housing Act. See Dkt.
15 at 4 fn. 3. A federal defense, however, is not sufficient
to establish federal question jurisdiction. See Hart v.
Bayer Corp., 199 F.3d 239, 244 (5th Cir. 2000).
“For better or worse . . . a defendant may not remove a
case to federal court unless the plaintiff's
complaint establishes that the case arises under federal
law.” Franchise Tax Bd. of State of Cal. v. Constr.
Laborers Vacation Tr. for S. Cal., 463 U.S. 1, 27-28
(1983) (emphasis in original); Rivet v. Regions Bank of
La., 522 U.S. 470, 475 (1998).
neither party, in their briefing, step through each element
of establishing federal question jurisdiction (which is
notable, as the removing party has the burden of proof to
establish a federal court's jurisdiction), the Court
briefly addresses the factors considered by the Court.
“[F]ederal question jurisdiction exists where (1)
resolving a federal issue is necessary to resolution of the
state-law claim; (2) the federal issue is actually disputed;
(3) the federal issue is substantial; and (4) federal
jurisdiction will not disturb the balance of federal and
state judicial responsibilities.” Singh v. Duane
Morris LLP, 538 F.3d 334, 338 (5th Cir.
2008). Here, Defendant does not argue that federal law
preempts state law, but rather cites the Fair Housing Act as
providing an affirmative defense. See Dkt. 15 at 4.
Defendant has not demonstrated that resolving a federal issue
is necessary to resolution of Plaintiffs' state-law
claims, that such a federal issue is actually disputed, or
that such issue is substantial. Rather, Defendant argues the
Fair Housing Act is substantial in that it is “one of
the most important federal policies in existence.” Dkt.
15 at 5. The significance of the Fair Housing Act is
indisputable. Case law demonstrates, however, that mere
invocation of the Fair Housing Act as a defense will not
create federal court jurisdiction. See Villanueva
Apartments v. Vasquez, No. CV H-17-1822, 2017 WL
4676645, at *2 (S.D. Tex. July 24, 2017), report and
recommendation adopted, No. CV H-17-1822, 2017 WL 4620959
(S.D. Tex. Oct. 16, 2017) (no federal court jurisdiction
where, in the notice of removal, defendant asserted plaintiff
violated the Fair Housing Act). Texas state courts regularly
consider matters involving the Fair Housing Act. See Tarr