? _ I 2 a
Christine E. Springer 1 181 1 North Tatuir Blvd., Ste. 303 Phoenix, Arizona 85028 (602) 350-21s I Pro Se Plaintiff
FTLED _rys1czo RECEIVED
.jLil' $ b ?t1i 1
UNITED STATES DISTRICT COURT 5
DISTRICT OF ARIZONA
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Christine E. Springer, an unmarried woman,
PLAINTIFF'S MOTION FOR REMAND
BANK OF AMERICA, N.A., and its subsidiaries, BAC HOME LOAN SERVICING, LP, f/k/a Countrywide Home Loans Servicing, LP and RECONTRUST, a National Banking Association; COUNTRYWIDE HOME LOANS, INC., f/k/a COUNTRYWIDE BANK, FSB; MORTGAGE
ELECTRONIC REGISTRATION SYSTEMS, INC., a Delawale corporatioi; 17 625 North 7m Street, # | 1 64, Phoenix, Arizona 85022: JOHN AND JANE DOES 1-1OOO, XYZ CORPORATIONS 1-15; ABC LIMITED LIABILITY COMPANIES 1-15; andl23 BANKING ASSOCIATIONS I - 1 5.
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SUMMARY OF THE CASE BEFORE THIS COURT
Pursuant to 28 U.S.C.
$ 1aa7(c) and other applicable law, Plaintiff Christine
Springer hereby files her Motion to Remand this case to the Maricopa County Superior
Court. Defendants jointlyt removed this case to this Court on June 29,2011 and therefore 25
' All named Defendants joined in the removal and apparently are represented solely by Gregory Iannelli of Bryan Cave L[.P
this Motion is timely. The sole ground for dismissal was diversity2 based upon the alleged
fraudulent joinder of ReconTrust by Plaintiff. Defendants contend the requisite amount for
establishing diversity (the second prong of the diversity test) has been met; that is, the
amount in controversy is in excess of $75,000.
Plaintiff contends the Removal is procedurally defective in that the amount in
controversy cannot be met and because the grounds alleged by Defendants for removal, fraudulent joinder, do not exist. Additionally, Plaintiff claims there are several other bases
for remand, some of which are issues of first impression in this jurisdiction and may also
be in the Ninth Circuit3. These issues include:
All Defendants lack standing to remove
as they have
no interest in either the
title to Plaintiffs property, or the promissory note, both issues to be litigated in this
has indicated in a recent ruling,
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n v. Deutsche Bank Nati
al., D.C. No. 3:09-cv-00228-RIC. there are serious issues whether a federal court should address in rem actions which address only state court issues.a
The action alleged is essentially an in rem action and as the Ninth Circuit
An Arizona Magistrate Judge in this Court has already ruled on the issue of
abstention, and consistent with that case, Plaintiff contends that the doctrines of abstention
require this case to be remanded and heard Home Loan Corp.,2010 WL 5758614
in state court. See Forde v. First Horizon
(D. Ariz. Dec.6,2010). A copy of this Order is
No federal claims were pled by Plaintiff and therefore the ONLY ground for removal would be "diversity" if it can be qstablished. - Plaintiff has the right to seek review of a denial of her Motion for Remand in the Ninth Circuit by either a Writ of prohibition or Appeal and intends on doing so, not only because the Defendants are abusing the processes ofthis Court by this "near frivolous" claim of fraudulent joinder, but because the issues presented need to be addressed by the Ninth Circuit and have not been in the context ofthe foreclosure crisis now enveloping the Courts ofthis state. Plaintiff suggests that this Court may, like the Ninth Circuit and the United States Bankruptcy Court, Arizona wish to certiff the
issue to the Arizona Supreme Court ofwhether cases such as the case at bar should ever be heard in federal court. or whether the sole appropriate forum for such actions is in state court.
attached as Exhibit A.
There is an absence of federal law in the Ninth Circuit that would indicate
that a federal court sitting in diversity has the authority in an in rem foreclosure action to
grant a temporary restraining order to prevent Defendants from foreclosing or evicting
that this Court is without jurisdiction to do so, leaving Plaintiff to go to state court at the
eleventh hour to seek injunctive relief to stop the eviction.
such would become necessary in the instant case, Defendants may contend
PROCEDURAL AND FACTUAL BACKGROUND
In July of
to mounting financial difficulties, Plaintiff filed
bankruptcy under Chapter 7. Plaintiff moved out of the property.
Plaintiff s bankruptcy proceeding was open for seven months. Defendants
were given Notice of Plaintiffls bankruptcy, yet none of them stepped forward during
those proceedings to assert any claims. Defendants did not
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file a Proof of Claim or a
Motion to Lift Automatic Stay.
Plaintiff received a Discharge under Chapter 7 on February 11, 2010, Case
No. 2:09:bk-15521. A copy of Plaintiff
Discharge is attached at Exhibit B.
When Plaintiff s discharge was issued and no foreclosure had taken place,
Plaintiff became concerned because the property was vacant and the
condominium complex had failed, causing the surrounding area to become economically unstable. She was therefore required to expend funds for additional insurance, including a vacancy clause, on the property and for securing the property.
On April 26, 2010, Defendant BAC Home Loans Servicing, LP
Plaintiff a letter notifying her that ownership of the first loan had been transferred to CWHL. In that letter, BAC admitted that it was the only the servicer of the loan and not a creditor.
On September 22, 2010, the North Parc Owners Association threatened
Plaintiff with a lawsuit for unpaid COA dues.
In December 2010, Plaintifl frustrated with the lack of closure with respect
to the foreclosure on the Property, paid all past due COA dues that were owed from the
time the property was vacant and moved back into the property. Plaintiff expended
dollars worth of repair work, including a new water heater, a new air handler, new
flooring, new bathroom faucets, new windows, a new fence, and plumbing repairs as a
result of sitting vacant for eighteen months.
of dollars in moving, utility disconnection/reconnection, cleaning and repair
to make the property habitable. The property presently needs several thousands of
Then, without any notice, on June
Kim Panozzo, a non-lawyer and
real estate agent who claimed to be "representing" Defendant BOA trespassed
Plaintiffs property, told Plaintiffs mother that the property had been sold, and that
Plaintiff needed to contact her "to make moving arrangements."
Upon further review of the documents left by Ms. Panozzo, Plaintiff found
information on Defendant ReconTrust's website about the non-judicial sale of Plaintiff
property on its website. The information available on the website referenced a sale held on
May 27,2011 and that Defendant MERS purchased the property for $39,150.00.
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Exhibit C. Plaintiff never received notice of this sale and was still owner of record on title.
On June 14,2011, Plaintiff filed a lawsuit against the Defendants because
none of the documents recorded by Defendants evidence that any of the Defendants have
any standing to non-judicially foreclose, and the non-judicial sale was done without any notice to Plaintiff.
It is reasonable to conclude that if
Defendants had any interest in the
loan, or were concerned about protecting their interests, they would have come forward during Plaintiff s bankruptcy or at least made sure the documents they were preparing and recording actually made sense and demonstrated a clear chain of title. Yet, they did not come forward and they recorded documents fulI of false and fraudulent information that
have broken the chain of title, making the property unmarketable, which explains why
Defendant MERS was the purchaser at the purported auction. No intelligent buyer is
going to purchase a property with title problems.
15. All Defendants have been served. Plaintiff received the Affidavit of Service
from the process server that served Defendant MERS on Wednesday, June 29,2011.
Plaintiff filed the Proof of Service for MERS and ReconTrust on July 4,2011.
16. Plaintiff filed an Application for a Temporary
Restraining Order on
Monday, June 20, 20lT after finding a letter from an out of state law firm lying on the
ground outside of her property. See Exhibit D. The conespondence is from Johnson &
LLC, located in Atlanta, Georgia and threatened Plaintiff with an unlawful
detainer action unless she moved out of the property within five (5) days. Notably, the
letter fails to identifu who the firm's client is and there is no Arizona licensed attorney
listed that Plaintiff could contact to discuss the pending lawsuit.
Plaintiff served all Defendants with written notice of the Show Cause Hearins.
INITIATION OF REMOVAL
Counsel for Defendants, Gregory Iannelli, called Plaintiff on June 29, 2011.
During that discussion, there was no discussion of removal. Mr. Iannelli intentionally removed the case to avoid an appearunce at the Show Cause Hearing set by Judge Fenzel.
Judge Fenzel scheduled a Show Cause Hearing for Friday, June 29,2011.
Defendants removed this case
to federal court on the basis of diversity
jurisdiction, amount in controversy in excess of $75,000, and for fraudulent joinder.
Defendants' bear the burden of proof in a removal. That burden has not been
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Specifically, Defendants claim the amount in controversy is $183,655.12. However, Defendant MERS purportedly purchased the property at auction for $39,150.00
five weeks ago. See Exhibit B. Defendants have not met the burden of establishins the
amount in controversy.
Defendants also have the burden to establish fraudulent joinder by "clear
and convincing evidence." Hamilton Materials. Inc.. v. Dow Chemical Corp., 494 F.3d
1203, 1206 (9tt' Cir.2007). Defendants have not met this burden, making only vague
allegations without clear and convincing evidence. Defendants failed
standard in their Notice of Removal. Further, Defendants did not make a claim that they
have met the standards for removal.
THE REMOVAL IS PROCEDURALLY DEF'ECTIVE
Superior Court; and (2) Defendants' failure to properly allege and substantiate the amount
There are two reasons why the removal is procedurally defective: (1)
to submit a complete copy of the file from the Maricopa
LRCiv 3.7 (b) states, "The removing party must file copies of all pleadings
and other documents that were previously filed with the state court, accompanied by
verification from the removing party or its counsel that they are true and complete copies
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pleadings and other documents filed
in the state court proceeding.
removing party files a motion requesting an extension of time for good cause, the state court record must
Jiled when the notice of removal
Defendants did not
file copies of all pleadings and other documents
were previously filed with the state court, accompanied by a verification from Mr. Iannelli
that they are true and complete copies of all pleadings and other documents filed in the state court proceeding.
Mr. Iannelli also failed to file a motion to request an extension of time for
good cause to later include the documents that he knew were missing from the Superior
Court's record. Mr. Iannelli failed to include a copy of Plaintiffs Application for Temporary Restraining Order.
Plaintiff f,rled the Temporary Restraining Order with the Maricopa Superior
Court on June 20,2011, nine days before Defendants removed the case. 27
Additionally, Plaintiff provided Mr. Iannelli with a copy of the Application
for Temporary Restraining Order by e-mail.
There is no excuse for Mr. Iannelli to have left this document out of the
removal package. LRCiv 3.7 (b) states "all pleadings and other documents filed in the
state court proceeding...." He knew about the Application for Temporary Restraining
Order but did not include it with the Notice of Removal. nor did he file a Motion for more
time to include it.
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to 28 U.S.C. $1332 (a), the district court shall have
jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000.
Defendants make a cursory allegation that this standard has been met in
their Notice of Removal.
Plaintiff purchased the property in2007 for $197,000. The debt was discharged by the United State Bankruptcy Court, Arizona on
February 11,2010, Case No. 2:09:bk-15521.
Defendant MERS purportedly paid $39,150.00 for the property onMay 27,
2011. See Exhibit C.
The chain of title is broken because of the documentation recorded by the
Defendants and therefore the property is unmarketable. Plaintiff alleges that this is the reason the only bidder at the auction was Defendant MERS
no one is going to purchase
property with title defects. Because the title is unmarketable, the property is worthless and has no value for the purposes of establishing the amount in controversy.
Defendants fail to explain why the amount
in controversy is not the price
they allegedly paid for it as opposed to the original value or acknowledge the fact that it is
worthless because of the unmarketability of the title as a result of their conduct.
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appropriate because the amount
is less than
$75,000 and because the removal is procedurally defective.
V. THE ALLEGATION OF FRAUDULENT JOINDBR HAS NO BASIS 37. Defendants allege that Defendant ReconTrust was fraudulently joined. This allegation is vague, unsupported and meritless. Joinder is fraudulent
the plaintiff fails to state a cause of action against a resident
defendant, and the failure is obvious according to the settled rules of the state. Hunter v.
Philip Morris USA,582 F.4d 1029,1043
Defendants have the burden
establish fraudulent joinder
by "clear and
convincing evidence." Hamilton Materials. Inc.. v. Dow Chemical Com.,4g4 F.3d 1203, 1206 (9h cir.2007).
The removing Defendant must show "that there is no possibility, based on the
pleadings, that a plaintiff can state a cause of action against the non-diverse defendant in
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state court." Pampillonia v. RIR Nabisco. Inc., 138 F.3d 459,461 (2d Cir.l998).
ambiguities in state law must be resolved in the plaintiff s favor. Dodson v.
Sillada Maritime Corp., 951 F.3d 40,4215th Cir.199S).
Fraudulent joinder allegations are improper where they "manifestly [go] to the merits of the action as an entirety, and not to the joinder; that is to say [the allegations
indicatel that the plaintiffs case was ill-founded as to all the defendants. Smallwood
Illinois Central Railroad Co.,342 F.3d 400, 403-404 (5ft Cir.2003), (citingChesapeake & Ohio Railwoy Co. v. Coclvell,232IJ.S. 146,153, S.Ct.278, 5g L.Ed. 544
Defendants have not met their burden because they have not shown by
clear and convincing evidence that ReconTrust was fraudulently joined. Defendants have
also not shown why Plaintiff has not stated a cause of action against ReconTrust.
Defendants' allegation that A.R.S. $33-807(E) entitles ReconTrust to
dismissal also fails. The protections under this statute are reserved for trustees who are
lawfully appointed. There is no evidence that ReconTrust was appointed to serve as
substitute trustee other than documents created by ReconTrust and signed by ReconTrust
employees. Thus, there is no protection for Defendant ReconTrust under A.R.S. $33-
Defendants have failed
establish that ReconTrust was fraudulently
joined and that Defendant ReconTrust is protected under A.R.S. $33-807(E).
OTHER REASONS FOR REMAND
Plaintiff raises the following additional grounds for remand.
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All Defendants lack standing. There is no evidence that any of the
Defendants are entitled to non-judicially foreclose on Plaintiff s properfy. The documents
the Substitution of Trustee, Notice of Trustee's Sale,
Assignment of Deed of Trust, are all defective as outlined in Plaintiff s Complaint.
The Federal Court lacks jurisdiction over the res. Plaintiff s lawsuit
rs an in rem action There is no state law issue regarding whether quiet title actions arc in
rem or in personam Kennedy,
1930 Arizona Supreme Court Decision, Snow v.
36 Ariz. 475, (1930) makes it clear that "[A]n action to quiet title is
proceeding in rem and a court has no jurisdiction to render a judgment affecting the title to real property unless it has jurisdiction of the res, since real estate is governed by the law
its situs, is 'subject only to the jurisdiction of the courts of the state where
situated. . ." (emphasis added.) 25
See also TWE Retirement Fund Trust 26
v. Ream, 198 Ariz. 268 (2000), "[R]eal
estate is governed by the law of its situs."
is appropriate under
Rooker-Feldman, Burford and
Younger Doctrines. As mentioned previously, the Forde case is on point regarding
abstention, Forde v. First Horizon Home Loan Corp., 2010 WL 5758614 (D. Artz. Dec. 6,
2010). Plaintiff s lawsuit concerns issues of state real property law and the interplay of
various state law statutory schemes. These issues should be decided in state court.
Remand is Appropriate Because Federal Court Lacks Jurisdiction to
Issue a Temporary Restraining Order
or Preliminary Injunction. In Plaintiffs
chosen jurisdiction, the court has authority
to issue a Temporary Restraining Order
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Preliminary Injunction. Plaintiff would have had an opportunity to be heard if Defendants had not removed the case to federal court the day before the hearing.
TheAnti-Injunction Act,28 U.S.C. 52283, is aUnited States federal statute that prohibits any federal court from issuing an injunction against proceedings in any state court, except within three specifically defined exceptions. As such, Plaintiff cannot seek
relief to stop an unlawful detainer in federal court.
Defendants and their agents have already sent multiple individuals who have
attempted to enter the property, looked in the windows and photographed the property.
Further, Defendants' counsel has already stated that Defendants
stipulate to waiting until the case
is litigated on the merits to prosecute an unlawful
47. It is therefore obvious why Defendants removed
the lawsuit, especially
given their vague and meritless claims. Defendants' and other large banking institutions
routinely harass pro 23
Plaintiffs with removals (especially under the guise of "fraudulent
removal") because most pro se Plaintiffs are not prepared to adequately defend themselves.
Further complicating these issues is Arizona's unlawful detainer statutes. An
unlawful detainer hearing for the defendant is nearly impossible for skilled attorneys to
win, let alone a pro
the issue of chain of title or fraudulent and false recordings.
party. The standards are naffow and do not allow for hearings on
Removal is appropriate in two situations: on the basis of diversity jurisdiction or
there is a federal question. Defendants fail to meet both. There is no explanation or
supporting evidence offered as
allegations and lack
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supporting evidence or argument are not enough to meet the
importance; retention of jurisdiction would be disruptive of Arizona's need to rule on issues of first impression.
That this issue is one of first impression in Arizona, undecided by any state court,
Additionally, foreclosures in Arizona are a policy problem of substantial public
to the reasons for the removal. Defendants'
was succinctly and purposefully pointed out by the Arizona District Court in March of last year.
In Garcia v. ReconTrust Co.. No. CV-08-81l3-PHX-MHM, Garcia sued her lender and MERS, arguing, among other things, that the trustee's sale should be enjoined, and that the original promissory note must be presented before foreclosure can be initiated. In responding to these arguments, the Honorable Mary H. Murguia stated:
The only courts that have addressed this issue are federal courts within the District of Arizona; neither the Arizona Court of Appeals, nor the Arizona Supreme Court have weighed in on the issue. [C]ourts within the District of Arizona "have routinely held that [a plaintiff s] 'show me the note' argument lacks merit."
Given the absence of instruction from the Arizona Supreme Court or Court of Appeals, the most reasonable course of action is for this Court to follow the rirfines of its sister courts within the District of Arizona and hold that production- of the original promissory note is not required before commencing a foreclosure/t--rustee"s sale. To the extent Gariia intends to argue that these non-judicial proceedings are indeed contemplated by the
effect, Judge Murguia made the strongest argument possible for federal
abstention in Arizona foreclosure cases. Foreclosures in this state are a critical matter
statewide importance to its citizens and to its economy. Plaintiff homeowners are seeking
the assistance of their local courts, while their lenders and related defendants remove these
Atizona Supreme Court have not addressed these matters
importance because the banks prevent these cases from ever achieving that level, each
to federal court as a matter of
course. The Arizona Court
of Appeals and the
of substantial statewide
time they remove the matter to federal court. The "accidents of residence" should not stand in the way of this state's interpretation and construction of its own statutes, a matter
of strictly local concern.
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When a federal court has no guidance from the state in terms of rules of decision, the matter should be remanded to state court. The goal of a federal court, sitting in diversity, is to resolve a lawsuit in substantially the same manner as the state court would. See, e.g., Gasperini
2220 (1996) (a federal court sitting
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in diversity should have "substantially the same',
outcome as a state court would have, deciding the same matter).
When the state courts have not decided a matter,
v. Center for Humanities. Inc.. 518 U.S. 415,42g,116 S.Ct.
it is impossible for the federal
court to divine how the state court would have ruled. This is precisely the situation now before this Court. The Arizona state courts have never had an opportunity to speak on many of the issues brought to court by this Plaintiff. Her claims are all state law claims, some of which are claims of first impression regarding the proof required of a parfy before that s
see also' Diessnerv' Mortgage Electronic Registration systems,6l8 F.Supp.2d cite' nor is the court aware of, any controlling authority providing
llg4, l1g7 (D. Ariz. 200g) (..Diessner does not that the ucc section applies in non-judicial foreclosure proceedings in Arizona'"); Mawour v. cal-Ivestern "lt.o Reconveyance Corp.,6lg F.Supp.2d ll7g, (D. Ariz.200g) (,.no reported cases address the appricability of A.R.s. 47-3301 in a factualry analogous situation.,,) $
party may be paid pursuant to, or foreclose due to an alleged default on, a promissory note
which has been sold, insured, resold, and resold. Federal court determinations of these
difhcult f,rrst impression issues of state law and policy. The "accident of residence" of the
parties should not operate to deprive the State Court of its need to rule on the state law
issues presented here, and develop
burgeoning arca of litigation.
date, have prevented the state courts from confronting and deciding these
a coherent body of
to deal with this
Based on the foregoing, Plaintiff respectfully requests that this Court remand her
lawsuit to Maricopa County Superior Court. Plaintiff respectfully requests that this Court
abstain from deciding her lawsuit, and instead remand it to Superior Court.
The state courts of Arizona have not had the opportunity to rule on a number of
claims being asserted by Plaintiff here, and other homeowners in lawsuits pertaining to
foreclosures, in this State. Such issues of first impression are without doubt matters of the
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utmost statewide significance, and should be decided by the state courts, interpreting state
law. The District
Courts in Arizona, deciding homeowner diversity cases before them,
have voiced a desire for guidance from the state courts on these issues. Remand to state court will provide that guidance.
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RESPECTFULLY SUBL4ITTED on this 5e day of July, 201 1.
11811 North Tatum Blvd.. Ste. 3031 Phoeirix, Arizona 85 028 Pro Se Plaintiff
The ORIGINAL of the foregoing was hand delivered on the 5'h of July, 2011 to: Sandra Day O'Connor U.S. Courthouse 401 W. Washington Street, Suite 130, SPC Phoenix, AZ 85003-2118
And a COPY mailed on the 5fr day of July, 2011 to: Gregory Iannelli Bryan Cave LLP Two North Central Avenue, Suite ?200 Phoenix, Arizona 85004 CounsEl for Defendants
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Christine Springer's Motion to Remand in Springer v. Bank of America, et al