857 F. Supp. 2d 544
D. Maryland2012Background
- Trustees filed an Order to Docket a foreclosure in the Circuit Court for Prince George’s County, Maryland, on September 10, 2009.
- Charles filed a Counterclaim and a Third Party Complaint (federal TILA and RESA claims) on June 3, 2011 within the foreclosure proceeding.
- On July 21, 2011, Trustees and Nationstar removed the Counterclaim and Third Party Complaint to federal court.
- Charles moved to remand to state court under the well-pleaded complaint rule and separately moved for attorneys’ fees; Nationstar and Trustees moved to dismiss.
- The court granted remand, denied fees, and held that removal was improper, with the case remanded to state court; Nationstar’s and Trustees’ MOOT motions followed.
- The court analyzed whether an Order to Docket foreclosure is a pleading and who was the proper “defendant” authorized to remove the case.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether removal was proper under §1441(a) | Charles contends Trustees and Nationstar were not proper defendants to remove. | Trustees/Nationstar argue third-party status allows removal under §1441(c). | Removal improper; remand granted. |
| Whether the Counterclaim/Third Party Complaint can support federal question removal | Remand relies on well-pleaded complaint rule; federal question not in the complaint. | Removal based on federal questions embedded in federal counterclaims/third-party claims. | No removal based on federal question; not within well-pleaded rule. |
| Whether a Maryland Order to Docket foreclosure is a pleading enabling removal | Order to docket is a pleading under current Maryland law. | Order to docket is not a pleading; severance not authorized for removal. | Order to docket not a removable pleading; removal improper. |
| Whether removal was objectively reasonable warranting fees under §1447(c) | Fees should be awarded for improper removal. | Remand was based on murky remand law and evolving Maryland foreclosure rules. | No fees or costs awarded. |
Key Cases Cited
- Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100 (U.S. 1941) (strict construction of removal authority for defendants)
- Palisades Collections, LLC v. Shorts, 552 F.3d 327 (4th Cir.2008) (third-party defendant generally cannot remove under §1441(a))
- Verizon Md., Inc. v. Global NAPS, Inc., 377 F.3d 355 (4th Cir.2004) (well-pleaded complaint rule governs federal question jurisdiction)
- Caterpillar v. Williams, 482 U.S. 386 (U.S. 1987) (federal question arises only from plaintiff's complaint)
- Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826 (U.S. 2002) (counterclaims cannot create removal jurisdiction)
- In re Blackwater Sec. Consulting, LLC, 460 F.3d 576 (4th Cir.2006) (well-pleaded complaint rule; federal defense not removing ground)
- Dixon v. Coburg Dairy, Inc., 369 F.3d 811 (4th Cir.2004) (doubts resolved in favor of remand when removal is uncertain)
- Fairfax Sav., F.S.B. v. Kris Jen Ltd. P’ship, 338 Md. 1 (Md. 1995) (state-court proceedings and counterclaims in foreclosure can affect removal)
- Mulcahey v. Columbia Organic Chems. Co., Inc., 29 F.3d 148 (4th Cir.1994) (removal standards and federalism concerns)