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U.S. Bank National Association v. Sanders

United States District Court, N.D. Georgia, Atlanta Division

September 30, 2014

U.S. BANK NATIONAL ASSOCIATION, Plaintiff,
v.
TINA M. SANDERS, Defendant.

OPINION AND ORDER

WILLIAM S. DUFFEY, Jr., District Judge.

This matter is before the Court on Magistrate Judge Walter E. Johnson's Report and Recommendation ("R&R") [4] which recommends remanding this dispossessory action to the Magistrate Court of Gwinnett County, Georgia. Also before the Court is Defendant's Application to Appeal In Forma Pauperis [7].

I. BACKGROUND

On April 30, 2014, U.S. Bank National Association ("Plaintiff" or "U.S. Bank") filed, in the Magistrate Court of Gwinnett County, Georgia, a dispossessory proceeding ("Complaint") [1.1 at 2-3] against Tina M. Sanders ("Defendant" or "Sanders"). The Complaint asserts that Defendant is a tenant at sufferance following an April 1, 2014, foreclosure sale of Defendant's property.

On May 20, 2014, Defendant, proceeding pro se, removed the Gwinnett County Action to this Court on the basis of diversity of citizenship. (Notice of Removal [1] at 2).

On May 20, 2014, Defendant also filed her "First Amended Answer, Third Party Complaint and Counterclaim" ("Answer") [1.1 at 9-11]. Defendant alleges that she "did not receive proper notice of the alleged foreclosure" and that "her Note is paid in full and there is not [sic] default" because "[t]he United States of American [sic] [p]aid [her mortgage] via the Pooling and Service [sic] Agreement." (Answer at 2). Defendant asserts a counterclaim for violation of the False Claims Act and seeks to recover $1, 000, 000.

On May 27, 2014, Magistrate Judge Johnson issued his R&R. The Magistrate Judge considered, sua sponte , whether the Court has subject-matter jurisdiction over this action. He concluded that the Court's jurisdiction cannot be based on diversity of citizenship. He also found that Plaintiff's Complaint is a dispossessory action, which is based on state law. Noting that a federal law defense or counterclaim alone is not sufficient to confer federal jurisdiction, the Magistrate Judge concluded that the Court does not have federal question jurisdiction over this matter. Because the Court lacks subject-matter jurisdiction, the Magistrate Judge recommended that this action be remanded to state court.

On June 9, 2014, Defendant filed her Application to Appeal In Forma Pauperis ("IFP") [7], seeking to appeal the Magistrate Judge's R&R.

On August 18, 2014, the Eleventh Circuit dismissed sua sponte Defendant's appeal [13]. The Eleventh Circuit found that it lacked jurisdiction to review directly the R&R, which is not a final and appealable decision. Because the Eleventh Circuit has dismissed her appeal, Defendant's Application to Appeal IFP is denied as moot.[1]

II. DISCUSSION

A. Legal Standard

After conducting a careful and complete review of the findings and recommendations, a district judge may accept, reject, or modify a magistrate judge's report and recommendation. 28 U.S.C. § 636(b)(1); Williams v. Wainwright , 681 F.2d 732, 732 (11th Cir. 1982) (per curiam). A district judge "shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made." 28 U.S.C. § 636(b)(1). With respect to those findings and recommendations to which a party has not asserted objections, the Court must conduct a plain error review of the record. United States v. Slay , 714 F.2d 1093, 1095 (11th Cir. 1983) (per curiam).

The parties have not objected to the R&R and the Court thus conducts a plain error review of the record.[2]

B. Analysis

In her Notice of Removal, Defendant appears to assert that the Court has subject-matter jurisdiction based on diversity of citizenship. Diversity jurisdiction exists over suits between citizens of different states where the amount in controversy exceeds $75, 000. 28 U.S.C. § 1332(a). Here, the record does not show the citizenship of the parties, and, even if there is complete diversity between the parties, the amount-in-controversy requirement cannot be satisfied because this is a dispossessory action. "[A] claim seeking only ejectment in a dispossessory action cannot be reduced to a monetary sum for the purposes of determining the amount in controversy." Citimortgage, Inc. v. Dhinoja , 705 F.Supp.2d 1378, 1382 (N.D.Ga. 2010); Novastar Mortg., Inc. v. Bennett , 173 F.Supp.2d 1358, 1361 (N.D.Ga. 2001), aff'd, 35 F.Appx. 858 (11th Cir. 2002); cf. Fed. Home Loan Mortg. Corp. v. Williams, Nos. 1:07-cv-2864-RWS , 1:07-cv-2865-RWS, 2008 WL 115096, at *2 (N.D.Ga. Jan 29, 2008) ("[A] dispossessory proceeding under Georgia law is not an ownership dispute, but rather only a dispute over the limited right to possession, title to property is not at issue and, accordingly, the removing Defendant may not rely on the value of the property as a whole to satisfy the amount in controversy requirement.").[3] The Court finds no plain error in the Magistrate Judge's finding that diversity jurisdiction does not exist over this action.

Although not alleged in the Notice of Removal, because of Defendant's pro se status, the Magistrate Judge also considered whether the Court has subject-matter jurisdiction based on the existence of a federal question. It is well-settled that federal question jurisdiction exists only when a federal question is presented on the face of a plaintiff's well-pleaded complaint, and that the assertions of defenses or counterclaims based on federal law cannot confer federal question jurisdiction over a cause of action. See Beneficial Nat'l Bank v. Anderson , 539 U.S. 1, 6 (2003); Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc. , 535 U.S. 826, 830-32 (2002). Here, Plaintiff's Complaint is a dispossessory proceeding against Defendant based only on state law. See O.C.G.A. § 44-7-50; Steed v. Fed. Nat'l Mortg. Corp. , 689 S.E.2d 843 (Ga.Ct.App. 2009) (when former owner of real property remain in possession after foreclosure sale, she becomes "tenant at sufferance, " and thus landlord-tenant relationship exists and dispossessory procedure in O.C.G.A. § 44-7-50 applies). The Court finds no plain error in the Magistrate Judge's finding that federal question jurisdiction does not exist over this action.[4]

Because the Court lacks both diversity of citizenship and federal question jurisdiction, this action is required to be remanded to the state court. See 28 U.S.C. § 1447(c) ("If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.").

III. CONCLUSION

For the foregoing reasons,

IT IS HEREBY ORDERED that Magistrate Judge Walter E. Johnson's Report and Recommendation [4] is ADOPTED.

IT IS FURTHER ORDERED that this action is REMANDED to the Magistrate Court of Gwinnett County, Georgia.

IT IS FURTHER ORDERED that Defendant's Application to Appeal In Forma Pauperis [7] is DENIED AS MOOT.

SO ORDERED.


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