United States District Court, N.D. Indiana, Fort Wayne Division
WELLS FARGO BANK, N.A., as Trustee for Merrill Lynch Mortgage Investors Trust, Mortgage Loan Asset-Backed Certificates, Series 2003-OPT1, Plaintiff,
JOY JONES, et al., Defendants.
OPINION AND ORDER
PHILIP P. SIMON, Chief District Judge.
Wells Fargo filed this case in Indiana state court in 2010 alleging that Joy Jones defaulted on her mortgage. Jones removed the case to this court on January 16, 2015. (Docket Entry 2.) Plaintiff Wells Fargo seeks remand of the case to state court, arguing that removal was untimely by about four years, and also that the other defendants did not indicate their consent to removal. (DE 11.) Jones opposes remand, arguing that equitable tolling should apply to her removal effort for several reasons, among them that Wells Fargo violated federal law and behaved deceptively and unfairly. (DE 19, 20, 22.) For the following reasons I find that this case may not be removed to this Court, and I will therefore order it remanded.
Jones got a mortgage loan from Option One Mortgage Corporation in 2003. The mortgage was ultimately transferred to Wells Fargo (Jones challenges the validity of the transfer). By 2010 Jones was in default on the loan, and Wells Fargo filed this case in October 2010 seeking a judgment against Jones and foreclosure of her mortgage. (DE 1 at 1-2, 4-5.) The case proceeded for years in state court, so I'm not going to get too far into the weeds, but I don't need to for the purpose of addressing removal and remand. Jones's filings in this Court also get into the underlying merits, but I'm not going there any more than is necessary to address her argument that equitable tolling should be applied to her removal to federal court.
Notably, Jones explains that "[o]n or about May, 2011, " after months of research, "it became clear that it was the Plaintiff that had not only failed to credit payments made by the Defendant to her account but as well had falsely and inappropriately made multiple charges to her escrow account." (DE 19 at 3.) Jones goes on to explain that she talked to a "volunteer advisory counsel" over the phone about "her discovery which now provided evidence for her RESPA and TILA claims. The attorney advised her that because she had timely mentioned the Federal violations as counterclaims they would be preserved as counterclaims in a Federal law suit against the Plaintiff which she could initiate at any time." (Id. ) So it is apparent, from Jones's own filing, that she knew of the potential federal issues in the case by May 2011, yet didn't remove the case to federal court for another three-and-a-half years.
Jones's excuses for waiting so long are these: She claims that some of her filings were not well taken in state court, and the way she was treated there made her "very fearful of submitting pleadings to the Court without a great deal of fear and trepidation." (Id. ) She states that her counterclaims arise under federal law, over which federal courts have "exclusive as well as original and federal question jurisdiction." (DE 20 at 2; see also, id. at 5.) And, probably most importantly, Jones alleges that "Plaintiff misrepresented substantial and material issues of fact and otherwise deceived the Defendant of its true intent with respect to loss mitigation all of which prevented the Defendant a legally unsophisticated and untrained individual from fully and timely understanding the full scope of her rights and options and from taking necessary action to remove the case before January, 15, 2015." (Id. ) Jones goes on to say that she diligently pursued the case as she understood it from 2010 to 2014. She argues that Wells Fargo's state complaint doesn't make clear the federal questions potentially at issue, and somehow Wells Fargo "prevented Defendant from understanding the full scope of its claims and decipher the extent of Federal and Removal jurisdiction. Defendant was thus prevented from from ( sic ) removing the case." (DE 20 at 3-4.) Jones goes on to point out that she lacked legal counsel, which meant it took her "much longer to research, read and understand the laws and procedures governing the case, " and in any event "it is well settled that it is difficult to determine if there is a substantial federal question on the face of a well-pled complaint." (DE 20 at 4.) And Jones alleges that "Plaintiff also led her to falsely believe that it was going to settle the case." (Id. )
Moving on to the present, Jones filed a notice of removal and motion for leave to proceed in forma pauperis on January 16, 2015. (DE 2, 3.) Wells Fargo timely moved to remand on February 13, 2015. (DE 11.) Jones asked for and received an extension (DE 15, 17), then responded to the motion to remand. (DE 19, 20.) Wells Fargo replied. (DE 21.) Then Jones filed an amended response to the motion to remand - a second bite at the response apple, and also an untimely response filed several days after the alreadyextended response deadline. (DE 22.) Wells Fargo has moved to strike the amended response under Rule 12(f) because it is redundant and untimely, and also because Jones attached to it e-mails exchanged during the course of settlement that Wells Fargo argues are confidential and should not have been filed publicly on the record (if at all). (DE 23.)
The state case named several defendants in addition to Jones, described as creditors and others who might have an interest in the property at issue. These defendants did not file their consent to removal. Jones explains that they have told her they do not intend to participate in the case at all because Wells Fargo has priority with respect to the property and they don't think it's worth their time to be involved. According to Jones, those defendants "do not believe their consent for removal was necessary." (DE 20 at 2.)
Defendants may remove state court cases to federal court if the district court would have had original jurisdiction. 28 U.S.C. § 1441(a). Jones only addresses federal question jurisdiction. 28 U.S.C. § 1331. But federal jurisdiction may alternatively arise out of complete diversity of citizenship between the two sides of the "v" combined with an amount in controversy over $75, 000. 28 U.S.C. § 1332. "Removal must occur within thirty days of the defendant's receipt of the complaint or within thirty days of the date that removal becomes possible." Lott v. Pfizer, Inc., 492 F.3d 789, 792 (7th Cir. 2007) (citing 28 U.S.C. § 1446(b)). "When a civil action is removed solely under section 1441(a), all defendants who have been properly joined and served must join in or consent to the removal of the action." 28 U.S.C. § 1446(b)(2)(A). "The party seeking removal bears the burden of proving the propriety of removal; doubts regarding removal are resolved in favor of the plaintiff's choice of forum in state court." Morris v. Nuzzo, 718 F.3d 660, 668 (7th Cir. 2013).
Jones doesn't discuss the citizenship of the parties, or diversity therein, and instead limits her argument for removal to the presence in the case of issues of federal law. The problem with that ground for removal is that the federal questions only arise in her counterclaims, and a counterclaim raising issues of federal law can't be the sole basis for removal. See Holmes Group, Inc. v. Vornado Air Circulation Sys., 535 U.S. 826, 832 (2002) ("we decline to transform the longstanding well-pleaded-complaint rule into the well-pleaded-complaint- or-counterclaim rule' urged by respondent") (abrogated only with respect to patent and copyright counterclaims by 28 U.S.C. § 1454, the Leahy-Smith America Invents Act of 2011, "[a] civil action in which any party asserts a claim for relief arising under any Act of Congress relating to patents, plant variety protection, or copyrights may be removed to the district court of the United States for the district and division embracing the place where the action is pending"; see, e.g., Peaches & Cream LLC v. Robert W. Baird & Co., No. 14-cv-6633, 2015 U.S. Dist. LEXIS 42575, at *10 n.3 (E.D.N.Y. Mar. 31, 2015)); see also, Vill. of Merrimac v. Eagles Nest on Lake Wisconsin, LLC, No. 12-cv-824-wmc, 2012 U.S. Dist. LEXIS 164555, at *1-2 (W.D. Wis. Nov. 16, 2012). It appears that the question of removal might well begin and end there.
The parties don't address the issue of diversity jurisdiction, but for the sake of completeness I will go on to address Jones's arguments for removal and tolling as if removal was, at some point, theoretically possible in this case, which would probably only be true based on diversity.
Jones wants the Court to find that her 30-day time limit to remove the case was tolled such that her 2015 removal of the 2010 case was timely. Equitable tolling is a "doctrine [that] deals with situations in which timely filing is not possible despite diligent conduct. Waiting until the last hours is not diligent; the errors that often accompany hurried action do not enable the bungling lawyer to grant himself extra time." Farzana K. v. Ind. Dep't of Educ., 473 F.3d 703, 705 (7th Cir. 2007) (citations omitted). "[E]quitable tolling is granted sparingly. Extraordinary circumstances far beyond the litigant's control must have prevented timely filing.... [T]he threshold necessary to trigger equitable tolling is very high, lest the exceptions swallow the rule." United States v. Marcello, 212 F.3d 1005, 1010 (7th Cir. 2000) (citations omitted). "[S]uch relief is available only where the petitioner is unable to [act] within the statutory period due to extraordinary circumstances outside his control and through no fault of his own. Mistakes of law or ignorance of proper legal procedures are not extraordinary circumstances warranting invocation of the doctrine of equitable tolling. Indeed, permitting equitable tolling of a statute of limitation for every procedural or strategic mistake made by a litigant (or his attorney) would render such statutes of no value at all to persons or institutions sued by people who don't have good, or perhaps any, lawyers." Arrieta v. Battaglia, 461 F.3d 861, 867 (7th Cir. 2006) (quotation marks and citations omitted).
On that note, a more general point: "Even pro se litigants... must follow the Rules of Civil Procedure." Townsend v. Alexian Bros. Med. Ctr., 589 Fed.Appx. 338, 339 (7th Cir. 2015) (citing McNeil v. United States, 508 U.S. 106, 113 ...