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Reed v. U.S. Bank National Association

United States District Court, M.D. Florida, Tampa Division

May 11, 2017




         This matter comes before the Court upon sua sponte review of pro se Plaintiff Patricia Reed's Complaint, filed on May 5, 2017. (Doc. # 1). For the reasons that follow, the Court dismisses the Complaint and grants Reed leave to file an amended complaint by June 8, 2017.

         I. Background

         Reed initiated this action on May 5, 2017, against Defendants U.S. Bank National Association, Ocwen Loan Servicing, LLC, Mortgage Electronic Registrations Systems, Inc. (MERS), American Brokers Conduit, and “Does 1 through 10 inclusive.” (Doc. # 1). The Complaint references numerous state and federal statutes but only lists two causes of action for (1) Cancellation and Expungement of an Instrument (“Assignment of Mortgage”), seeking cancellation and expungement of the mortgage recorded with the Sarasota County Recorder's Office; and (2) Declaratory Relief, seeking a declaration that the mortgage on file with the county recorder is voidable. (Id. at 41-42). Reed also filed an additional memorandum of law in support of her Complaint, including excerpts from various statutes and consent orders entered between Ocwen, U.S. Bank, and MERS and the Comptroller of the Currency of the United States. (Doc. # 2).

         Essentially, Reed argues her mortgage is voidable and the Defendant companies “do not have a lawful ownership or a security interest in [her] home.” (Doc. # 1 at ¶ 14).

         II. The Complaint Does Not Establish the Basis for the Court's Jurisdiction

         A. Federal Question

         Federal courts are courts of limited jurisdiction. Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994). And “because a federal court is powerless to act beyond its statutory grant of subject matter jurisdiction, a court must zealously [e]nsure that jurisdiction exists over a case, and should itself raise the question of subject matter jurisdiction at any point in the litigation where a doubt about jurisdiction arises.” Smith v. GTE Corp., 236 F.3d 1292, 1299 (11th Cir. 2001).

         Generally, the district courts have jurisdiction over cases “arising under the Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331. As stated in Merrell Dow Pharmaceuticals, Inc. v. Thompson, 478 U.S. 804 (1986), “the question of whether a claim ‘arises under' federal law must be determined by reference to the well-pleaded complaint.” Id. at 808. The Supreme Court has explained that “[u]nder the longstanding well-pleaded complaint rule, . . . a suit arises under federal law only when the plaintiff's statement of his own cause of action shows that it is based upon federal law.” Vaden v. Discover Bank, 556 U.S. 49, 60 (2009)(internal citations omitted).

         Within these parameters, the Supreme Court has clarified that a cause of action can arise under federal law in one of three ways. Franchise Tax Bd. v. Constr. Laborers Vacation Tr., 463 U.S. 1, 8 (1983). First, a federal law may “create the cause of action.” Id. at 8-9. Second, a cause of action may arise where “some substantial, disputed question of federal law is a necessary element of one of the well-pleaded state claims.” Id. at 13. Third, a cause of action may arise where “a federal cause of action completely preempts a state cause of action.” Id. at 24. The mere mention of a federal statute in a complaint does not create federal question jurisdiction. Hill v. Marston, 13 F.3d 1548, 1550 (11th Cir. 1994). Rather, federal question jurisdiction requires that a party assert a substantial federal claim. Hagans v. Lavine, 415 U.S. 528, 536 (1976); see also Baker v. Carr, 369 U.S. 186, 199 (1962)(holding that if jurisdiction is based on a federal question, the plaintiff must show that he has alleged a claim under federal law that is not frivolous).

         The Complaint is unclear regarding the basis for the Court's exercise of jurisdiction. Although the Complaint references various federal statutes and states that federal question jurisdiction exists, neither of the two causes of action is brought under a federal statute or the United States Constitution. (Doc. # 1 at ¶ 1). In fact, neither cause of action states the legal basis for the claim, leaving the Court to guess what federal statute could form the basis of the claim. The first cause of action, labeled Cancellation and Expungement of an Instrument (“Assignment of Mortgage”), appears to be a state common law claim for rescission of the mortgage.

         While the second cause of action seeks declaratory relief, the Complaint does not state whether Reed is bringing this claim pursuant to the federal Declaratory Judgment Act. Regardless, the “Declaratory Judgment Act does not itself confer jurisdiction upon federal courts.” United States v. Knowles, -- F. App'x --, No. 16-15080, 2017 WL 1089497, at *1 (11th Cir. Mar. 23, 2017). Rather, it “allow[s] parties to precipitate suits that otherwise might need to wait for the declaratory relief defendant to bring a coercive action.” Household Bank v. JFS Grp., 320 F.3d 1249, 1253 (11th Cir. 2003)(quotation omitted). “Thus, in the context of a declaratory judgment action, we must determine ‘whether, absent the availability of declaratory relief, the instant case could nonetheless have been brought in federal court.'” Knowles, 2017 WL 1089497, at *1 (quoting Stuart Weitzman, LLC v. Microcomputer Resources, Inc., 542 F.3d 859, 862 (11th Cir. 2008)). Here, Reed seeks a declaration that the mortgage is voidable. If declaratory relief were unavailable, the case would involve state law claims brought by Defendants to foreclose on Reed's property based on their interest in the mortgage. Thus, Reed's claim for declaratory relief does not establish this Court's exercise of federal question jurisdiction.

         And many of the federal statutes cited throughout the Complaint do not create private rights of action. For example, 15 U.S.C. § 7003 merely lists the exceptions to 15 U.S.C. § 7001, which states contracts should not be denied legal effect because an electronic signature of record was used in their formation. 15 U.S.C. §§ 7001, 7003. Reed also quotes a criminal statute, 18 U.S.C. § 1021, which criminalizes the false certification of unrecorded property conveyances by an officer or other person authorized by any law of the United States to record a conveyance of real property. (Doc. # 1 at 16). But, this is a civil case - not a criminal action. See Fisher v. Conseco Fin. Co., No. 3:07CV266/RV/MD, 2007 WL 3012881, at *3 (N.D. Fla. Oct. 12, 2007)(“Rarely is there a private right of action under a criminal statute.” (citing Chrysler Corp. v. Brown, 441 U.S. 281, 316 (1979))).

         Reed also has not identified what substantial question of federal law, if any, is a necessary element of her claims. A question of federal law is substantial if “the vindication of a right under state law necessarily turn[s] on some construction of federal law.” Merrell Dow, 478 U.S. at 808-09 (quoting Franchise Tax Bd., 463 U.S. at 9); see also Templeton Bd. of Sewer Comm'rs., 352 F.3d at 38 (noting that even where the federal law invoked does not create a private right of action, “when the interpretation of federal law is outcome-determinative, subject matter jurisdiction may be properly exercised”). Reed seems to invoke numerous federal statutes and Defendants' prior consent orders merely to accuse Defendants of wrongful mortgage handling ...

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