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Premier One Holdings, Inc. v. Nationstar Mortgage, LLC

United States District Court, D. Nevada

June 30, 2018

PREMIER ONE HOLDINGS, INC., Plaintiff,
v.
NATIONSTAR MORTGAGE, LLC, a foreign limited liability company, ROXEY A. RANFTL; DOES 1-100, inclusive, and ROES 1-100, inclusive, Defendants. NATIONSTAR MORTGAGE, LLC, Counterclaimant,
v.
PREMIER ONE HOLDINGS, INC., Counterdefendant.

          ORDER PLAINTIFF'S MOTION TO REMAND (ECF NO. 10)

          RICHARD F. BOULWARE, II UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         Before this Court comes Plaintiff / Counterdefendant Premier One Holdings, Inc. (“Plaintiff”)'s Motion to Remand. (ECF No. 10).[1] For the reasons stated below, the Motion to Remand is GRANTED.

         II. BACKGROUND

         On March 20, 2017, Plaintiff filed a Complaint in the Eighth Judicial District Court of Clark County, Nevada. (ECF No. 1-2). Plaintiff brings the following causes of action: (1) declaratory relief and quiet title; (2) preliminary and permanent injunction; and (3) unjust enrichment. On April 24, 2017, Defendant Nationstar Mortgage, LLC (“Nationstar”) filed a Petition for Removal to this Court. (ECF No. 1). Nationstar asserts as the grounds for removal that the Court has original jurisdiction over the determination of the constitutionality of the state foreclosure statute at issue. On May 1, 2017, Nationstar filed an Answer with Counterclaim. (ECF No. 4). In the Counterclaim, Nationstar argues that the Court has diversity jurisdiction as well as original federal question jurisdiction - the federal question is based upon Nationstar's assertion of civil claims arising under the Constitution, laws, or treaties of the United States.[2] Nationstar brings the following Counterclaims: (1) quiet title / declaratory relief pursuant to 28 U.S.C. § 2201, NRS 30.010 et seq., and NRS 40.010 et seq.; (2) declaratory relief pursuant to the Fifth and Fourteenth Amendments; (3) quiet title pursuant to the Fifth and Fourteenth Amendments; (4) permanent and preliminary injunction; and (5) unjust enrichment. Plaintiff filed an Answer to the Counterclaim on May 22, 2017. (ECF No. 6). On May 25, 2017, Plaintiff filed a Motion to Remand to State Court. (ECF Nos. 8, 10). Nationstar filed its Response on June 8, 2017. (ECF No. 11). Plaintiff filed a Reply on June 15, 2017. (ECF No. 13).

         III. LEGAL STANDARD

         A. Removal Jurisdiction

         28 U.S.C. § 1441(a) grants federal district courts jurisdiction over state court actions that originally could have been brought in federal court. “Removal and subject matter jurisdiction statutes are strictly construed, and a defendant seeking removal has the burden to establish that removal is proper and any doubt is resolved against removability.” Hawaii ex rel. Louie v. HSBC Bank Nev., N.A., 761 F.3d 1027, 1034 (9th Cir. 2014) (citation and quotation marks omitted). If the district court has not entered final judgment, and it appears that the court does not have subject matter jurisdiction, the case must be remanded to state court. 28 U.S.C. § 1447(c).

         B. Federal Question Jurisdiction

         A district court has “original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331. An action “arises under” federal law when “federal law creates the cause of action.” Merrell Dow Pharm. Inc. v. Thompson, 478 U.S. 804, 808 (1986). But even where a claim finds its origins in state rather than federal law, the Supreme Court has identified a “special and small category” of cases in which federal question jurisdiction still exists. Empire Healthchoice Assurance, Inc., v. McVeigh, 547 U.S. 677, 699 (2006). Federal jurisdiction over a state law claim may 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. See Grable & Sons Metal Prods., Inc. v. Darue Eng'g & Mfg., 545 U.S. 308, 314 (2005) (“[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[?]”). Grable does not provide a per se “test” for federal question jurisdiction. However, the presence of all four Grable factors suggests that federal jurisdiction is proper because there is a “serious federal interest in claiming the advantages thought to be inherent in a federal forum, ” which can be vindicated without disrupting Congress's intended division of labor between state and federal courts. Id. at 313 (citations omitted).

         IV. DISCUSSION

         A. Subject Matter Jurisdiction

         In the Petition for Removal, Nationstar proffers that the Court has original jurisdiction under 28 U.S.C. § 1331, because at issue is the constitutionality of Nevada Revised Statute (“NRS”) Chapter 116 and the statutory notice provisions of a homeowner's association foreclosure of a lien for delinquent assessments. In support of its argument, Nationstar cites to Bourne Valley Ct. Tr. v. Wells Fargo Bank, NA, 832 F.3d 1154 (9th Cir. 2016). Plaintiff argues in the Motion to Remand that there is no federal question on the face of the Complaint, and therefore the case cannot remain before this Court.

         The Court finds that Nationstar's Petition for Removal provides an insufficient basis for federal question jurisdiction. The second element of the Grable test requires that a federal issue be actually disputed. At the time Nationstar sought to remove the case, the Ninth Circuit had already decided Bourne Valley. Although a petition for certiorari was filed and not denied until June 26, 2017, the Court finds that at the time Nationstar filed its Petition for Removal, a federal court had determined that the nonjudicial foreclosure scheme of NRS 116 was unconstitutional; therefore, there remained no disputed federal issue at the time of removal. As there no longer remained a disputed federal issue at the time Nationstar removed this case to federal court, ...


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