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NRZ REO Inventory Corp. v. Lindberg

United States District Court, D. South Dakota, Western Division

May 28, 2019

NRZ REO INVENTORY CORP., Plaintiff,
v.
LAYNE A. LINDBERG, BARBARA J. LINDBERG, Defendants.

          ORDER

          JEFFREY L. VIKEN, CHIEF JUDGE

         INTRODUCTION

         This case concerns a state court eviction action. Defendants Layne and Barbara Lindberg, appearing pro se, removed this action from the Seventh Judicial Circuit Court of South Dakota. (Docket 1). They assert this court has supplemental jurisdiction over the action under 28 U.S.C. § 1367. Id. at p. 6. Plaintiff NRZ REO Inventory Corp. moved to remand the case to state court. (Docket 7). Defendants oppose remand. (Docket 10).

         The court referred the pending motion to Magistrate Judge Veronica L. Duffy pursuant to the court's standing order of October 16, 2014, and 28 U.S.C. § 636(b)(1) for a report and recommendation (“R&R”). (Docket 12). The magistrate judge recommended the motion to remand be granted. (Docket 14). Defendants objected to the R&R.[1] Under the Federal Magistrate Act, 28 U.S.C. § 636(b)(1), if a party files written objections to the magistrate judge's proposed findings and recommendations, the district court is required to “make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made.” Id. The court may “accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge.” Id. For the reasons given below, the court adopts the R&R in full and grants plaintiff's motion to remand.

         DISCUSSION

         I. Facts

         Plaintiff brought an action in South Dakota state court to evict defendants from a house in Rapid City, South Dakota. (Docket 1-1 at pp. 2-3). The house is the subject of another case recently dismissed by this court. See Lindberg et al. v. Dimon et al., CIV. 17-5089, 2019 WL 1460644 (D.S.D. Mar. 27, 2019), appeal filed, 19-1883 (8th Cir. Apr. 30, 2019). Defendants leased this house while it was in foreclosure proceedings. Id. at *2. U.S. Bank purchased the house during the foreclosure sale and conveyed it to plaintiff through a quit claim deed. (Docket 1-1 at p. 2). Defendants asserted the holder of the original mortgage, JP Morgan Chase Bank, breached a contract to sell the house to them. Dimon, 2019 WL at *4. The court concluded no contract to buy or sell the house existed between any party and defendants. Id. To the best of the court's knowledge, defendants do not own or have any legal relationship to the house.

         II. Legal Standards

         “Defendants may remove civil actions to federal court only if the claims could have been originally filed in federal court.” Cent. Iowa Power Co-op v. Midwest Indep. Transmission Sys. Operator, Inc., 561 F.3d 904, 912 (8th Cir. 2009) (citing 28 U.S.C. 1441(b)). “The district courts shall have original jurisdiction of 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. Diversity actions “may not be removed if any of the . . . defendants [are] a citizen of the State in which such action is brought.” Id. at § 1441(b)(2).

         To determine whether plaintiff's complaint presents a federal question, the court must “apply[] the well-pled complaint rule. This long-standing doctrine ‘provides that federal jurisdiction exists only when a federal question is presented on the face of the plaintiff's properly pleaded complaint.' ” Moore v. Kan. City Pub. Schs., 828 F.3d 687, 691 (8th Cir. 2016) (quoting Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987)). “[T]he question is, does a state-law claim necessarily raise a stated federal issue, actually disputed and substantial, which a federal forum may entertain without disturbing any congressionally approved balance of federal and state judicial responsibilities.” Grabel & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 314 (2005). “[T]he plaintiff is master of his claim and may avoid federal removal jurisdiction by exclusive reliance on state law.” M. Nahas & Co., Inc. v. First Nat. Bank of Hot Springs, 930 F.2d 608, 611 (8th Cir. 1991).

         Supplemental “jurisdiction does not provide an independent source of removal separate from § 1441.” Motion Control Corp. v. SICK, Inc., 354 F.3d 702, 705 (8th Cir. 2003). Where “diversity jurisdiction d[oes] not permit removal due to the prohibition of § 1441(b), ” supplemental jurisdiction “does not provide an independent basis for removal” and “removal [is] improper.” Id. at 706. “The proponents of federal jurisdiction bear the burden to establish federal subject matter jurisdiction, and all doubts about federal jurisdiction must be resolved in favor of remand.” Moore, 828 F.3d at 691 (quotation omitted).

         III. Analysis

         Defendants' sole discernable objection is that the magistrate judge erred by recommending remand.[2] Defendants assert this case “stems wholly from” their above-discussed other case in this court and that the two cases are “based on a common nucleus of operative facts.” (Docket 14 at pp. 4, 13). They complain the Clerk of Court refused to consolidate this removed action with their other case. Id. at p. 2. They ask the court to consolidate the two cases to avoid remand. Id. at p. 3. The court overrules defendants' objection because it has no subject matter jurisdiction to entertain this matter.

         Removal is improper because the court has no diversity, federal question or supplemental jurisdiction over the case. Diversity cases may not be removed if any of the state-court defendants are citizens of the state in which the action was filed. 28 U.S.C. § 1441(b)(2). Defendants do not deny their South Dakota citizenship; their removal notice and objections both include South Dakota addresses in the signature ...


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