United States District Court, M.D. Georgia, Columbus Division
PEDRO J. BURGOS, Plaintiff,
SAND CANYON CORP., f/k/a OPTION ONE MORTGAGE COMPANY, Defendant.
D. LAND CHIEF U.S. DISTRICT COURT JUDGE
alleges that Defendant, his loan originator, fraudulently
assigned his security deed to Wells Fargo Bank and that Wells
Fargo later wrongfully foreclosed on his home. Plaintiff sued
Defendant in the Superior Court of Muscogee County. Plaintiff
did not properly serve the Defendant, and he did not name
Wells Fargo as a defendant. Plaintiff nonetheless obtained a
default judgment against Defendant that set aside the
original security deed, the assignment to Wells Fargo, and
the deed under power. Years later, Defendant learned of the
action and filed a motion to set aside the default judgment
due to lack of personal jurisdiction. The Superior Court
granted the motion, then Defendant removed the action to this
Court and filed a motion to dismiss Plaintiff's
who is represented by counsel, has flooded the Court with a
series of motions and briefs, but the resolution of them
requires the Court to answer three simple questions: (1) was
this action properly removed to this Court such that this
Court has subject matter jurisdiction? (2) was the default
judgment previously entered in the state court properly set
aside? and (3) does Plaintiff's complaint state a claim
upon which relief may be granted? The answer to the first two
questions is yes, and the answer to the third is no.
Accordingly, this action is dismissed.
Was Removal Proper and Does the Court Have
undisputed that complete diversity of citizenship exists and
that the amount in controversy requirement is met. Plaintiff
is a Georgia citizen. Compl. at 2 ¶ 1, ECF No. 1-1.
Defendant is a citizen of California. Compl. Ex. A,
Certificate of Withdrawal, ECF No. 1-1 at 31 (stating that
defendant is a California corporation). The amount in
controversy exceeds $75, 000.00. See, e.g., Compl.
at 23 ¶ 1 (seeking more than $5 million in compensatory
damages). Accordingly, diversity jurisdiction exists under 28
U.S.C. § 1332(a)(1).
arguments that this run-of-the-mill wrongful
foreclosure/fraud/RICO action asserting in personam
tort claims is somehow subject to the exclusive in
rem jurisdiction of the Georgia state courts are so
unpersuasive that the Court's disposition of them
requires no further elaboration. Plaintiff also
misunderstands Younger abstention. It has no
application here. See generally Younger v. Harris,
401 U.S. 37 (1971) (in exceptional circumstances, federal
courts should abstain from adjudicating actions being
litigated in state courts). It is clear that Plaintiff's
quiet title action in state court is not an exceptional
circumstance warranting abstention. The general rule is that
pendency of a parallel state court action “is no bar to
proceedings concerning the same matter in the Federal court
having jurisdiction.” Sprint Commc'ns, Inc. v.
Jacobs, 571 U.S. 69, 73 (2013) (quoting Colorado
River Water Conservation Dist. v. United States, 424
U.S. 800, 817 (1976)). No. legitimate basis exists for
abstention under the circumstances presented in this action.
Defendant's removal was timely. A notice of removal must
be filed “within 30 days after the receipt by the
defendant, through service or otherwise, of a copy of the
initial pleading setting forth the claim for relief upon
which such action or proceeding is based.” 28 U.S.C.
§ 1446(b)(1). The present record supports the finding
that Defendant was not properly served with Plaintiff's
complaint until June 14, 2019, after Defendant
removed the action to this Court. Plaintiff previously
attempted to serve the Georgia Secretary of State with the
state court action pursuant to Georgia law. But because
Defendant obtained a certificate of withdrawal of its
authority to transact business in Georgia in 2008, before
this action was filed, service of process on the Georgia
Secretary of State is proper if a copy of the
process is also mailed to an officer of the
withdrawn corporation at the mailing address provided by the
company in its application for withdrawal. O.C.G.A. §
14-2-1520(c). Merely serving a secretary of state, without
more, violates due process. Ware v. Fleetboston Fin.
Corp., 180 Fed.Appx. 59, 62 (11th Cir. 2006) (per
curiam) (citing Wuchter v. Pizzutti, 276 U.S. 13, 21
(1928)). Therefore, in the context of serving a foreign
corporation, “the failure to comply strictly with the
statutory requirements for service on such corporation
renders the attempted service defective.” Id.
(citing Howard v. Technosystems Consol. Corp., 536
S.E.2d 753, 756 (Ga.Ct.App. 2000)).
did not point to any evidence that process was delivered to
Defendant in 2013. The correct address for service of process
was 6531 Irvine Center Drive, Irvine CA 92618. Burgos Aff.
(Mar. 12, 2019) Ex. A, Letter from D. Sugimoto to Sec'y
of State (Sept. 15, 2008), ECF No. 1-5 at 34. When Plaintiff
originally filed his affidavit of service in state court in
2013, he presented evidence that he mailed the letter to
Defendant at 6351 Irvine Center Drive, Irvine CA 92618.
Burgos Aff. (Apr. 5, 2013) Ex. A, Certified Mail Receipts,
ECF No. 1-3 at 92. Thus, he mailed the process and complaint
to the wrong address. When Defendant moved to set aside the
default judgment in state court, Plaintiff submitted another
affidavit, admitting that he made an error when he handwrote
the address but asserting that he typed the address correctly
in a separate area of the envelope. Burgos Aff. ¶ 6
(Mar. 12, 2019), ECF No. 1-5 at 30. In support of this
assertion, Plaintiff points to what he says is a copy of the
envelope that contained the process and complaint mailed to
Defendant, which he avers he obtained from the post
office. Id. Ex. B, Envelope, ECF No. 1-5
at 37. But that envelope is clearly marked “Returned to
Sender, Not Deliverable as Addressed, Unable to
Forward.” Id. Plaintiff pointed to no evidence
that the envelope containing the process and complaint were
delivered to Defendant, and his own evidence
suggests that it was not delivered and that it was
returned to him.
on the present record, the Court finds that Defendant was not
properly served with the complaint in this action before the
action was removed. And the removal clock cannot begin before
service of official process. Murphy Bros., Inc. v.
Michetti Pipe Stringing, Inc., 526 U.S. 344, 347-48
(1999) (“[A] named defendant's time to remove . . .
[is not triggered] by mere receipt of the complaint
unattended by any formal service.”). Defendant
nevertheless removed the action within thirty days of the
state court's order setting aside the default judgments
and reopening the action. A defendant may elect to remove
before service of process because “nothing in the
removal statute, or any other legal provision, requires that
a defendant be served with the complaint before filing a
notice of removal.” Whitehurst v. Wal-Mart,
306 Fed.Appx. 446, 448 (11th Cir. 2008) (per curiam). Removal
was timely under 28 U.S.C. § 1446(b).
Court rejects Plaintiff's argument that even if removal
was timely under 28 U.S.C. § 1446(b), it was untimely
under 28 U.S.C. § 1446(c). If a case is removed pursuant
to § 1446(b)(3) because it was not removable by the
initial pleading but later became removable, then it must be
removed within one year after commencement of the action
unless the court finds that the plaintiff acted in bad faith
to prevent removal. 28 U.S.C. § 1446(c)(1). Here, the
action was removable based on the initial pleading, so
removal was not pursuant to § 1446(b)(3); thus §
1446(c)(1)'s one-year limitation does not apply.
timely removed this action which the Court has subject matter
jurisdiction over based upon diversity of citizenship,
Defendant is entitled to have this action adjudicated in this
Court. Plaintiff's motion to remand and
jurisdiction-related motions are denied.
Should this Court Disturb the State Court's Setting Aside
of Plaintiff's Default Judgment?
receiving briefs from the parties and holding a hearing where
Plaintiff was represented by counsel, the state court
determined that Plaintiff had not properly served the
Defendant in the state court action in which Plaintiff had
previously obtained default judgments. Therefore, the state
court set aside the default judgments for lack of personal
jurisdiction. Plaintiff claims that the state court had no
authority to set aside the judgment and that this Court
should not accept the default judgment as having been set
a general rule, when a case is removed to federal district
court under original jurisdiction the federal court treats
everything done in the state court as if it had in fact been
done in the federal court.” Salery v. United
States, 373 Fed.Appx. 29, 30 n.1 (11th Cir. 2010)
(citing Savell v. S. Ry. Co., 93 F.2d 377, 379 (5th
Cir. 1937)). “Therefore, assuming an error occurred in
the state court, a federal district court ‘may dissolve
or modify injunctions, orders, and all other proceedings
which have taken place in state court prior to
removal.'” Id. (quoting Maseda v.
Honda Motor Co., 861 F.2d 1248, 1252 (11th Cir. 1988)).
The Court finds no error in the state court's decision to
set aside the default judgment. As discussed previously, the
record supported the finding that Defendant had not been
properly served with the complaint, and thus the state court
did not have personal jurisdiction over the Defendant at the