Foreclosure Defense: Homeowners Face Judge Lauren Reeder, Deutsche Bank and PHH Mortgage

It has long been the case that “the jurisdiction of the court depends upon the state of things at the time of the action brought.”

Mollan v. Torrance, 9 Wheat. 537, 539 (1824).

This time-of-filing rule is hornbook law (quite literally) taught to first-year law students in any basic course on federal civil procedure.

It measures all challenges to subject-matter jurisdiction premised upon diversity of citizenship against the state of facts that existed at the time of filing — whether the challenge be brought shortly after filing, after the trial, or even for the first time on appeal.

(Challenges to subject-matter jurisdiction can of course be raised at any time prior to final judgment.

See Capron v. Van Noorden, 2 Cranch 126 (1804).)

We have adhered to the time-of-filing rule regardless of the costs it imposes.

Grupo Dataflux v. Atlas Glob. Grp., L.P., 541 U.S. 567, 570-71 (2004)

In sum, Avalos’s removal of this case to federal court was procedurally defective, in violation of the forum-defendant rule.

Avalos, the sole defendant in this case, could “snap” remove this case to federal court in compliance with Section 1441(b).

Moreover, Fortis never properly served Avalos in the state court proceedings below because Avalos never received a citation and petition.

However, Texas Rule of Civil Procedure 121 has clear commands that filing an Answer substitutes service, and Avalos’s Answer filed in state court therefore triggered this rule.

See Doc. No. 1-2 at 38.

LIT: In the case of Samuels, all the defendants appeared and answered before removal in Harris County District Court (the Exhibit A attached in Federal court include the answers)…as such Judge Bennett should be remanding this case when he decides to release his Order.

Indeed, Avalos has failed to provide relevant case law showing that Rule 121 does not apply in the context of injunctive relief proceedings, only that filing an Answer does not waive a defendant’s right to removal.

...This case should therefore be remanded to the 253rd Judicial District Court of Liberty County, Texas, as Cause No. 22DC-CV-01607.

Fortis Constr. v. Avalos, 1:23-CV-00009-MAC-ZJH, at *20 (E.D. Tex. Feb. 9, 2023)

When foreclosure mill lawyer Alex Rio (for Emily Stroope) of Baker Donelson sent the draft Joint Status Update (“JSU”) providing the parties with only a couple of hours to respond, Joanna Burke replied on the turn with the following email and content:

“Per federal docket 1-4, I, Joanna Burke am not listed as a removed party and disavow any claim or interest in these proceedings. Please remove me immediately from your JSU.”

Joanna is referring to the Civil Cover Sheet which attaches to a new or removed proceeding and which identifies the parties and causes of action, etc. See; “the Court construes her civil cover sheet as part of her complaint and finds that she has asserted a federal question sufficient to invoke the Court’s jurisdiction.” Hendrix v. Iqor Inc., No. 3:20-cv-00437-N (BT), at *4 (N.D. Tex. Oct. 27, 2020)

In response, one of the email recipients, Mark Cronenwett responded and the full subsequent thread of his ‘conversation’ with Alex Rio is attached in this converted PDF.

It should be remembered, this lawyer, Mark Cronenwett claims to represent AVT Title Services, LLC  – a “Nominal Party” and appointed substitute trustee by the mortgage servicer Onity, on behalf of Deutsche Bank – is always discounted when seeking federal jurisdiction for their fraudulent removals (relying upon diversity of the parties).

Yet here, he wishes to inject himself into this conversation, a nominal party who is “hired” by Alex Rio’s clients, PHH Mortgage and Deutsche Bank.

Furthermore, it’s evident from the docket, LIT’s associated articles, and copies of docket filings that Deutsche Bank and others were directed by the federal judiciary.

This directive emphasized that omitting Joanna Burke’s state court pleadings—both in the cover sheet and in the removal filings—would disrupt the federal judiciary’s dubious efforts to classify Joanna Burke as a vexatious litigant through judge shopping selection tactics (assigning the Samuels’ case to the last federal judge Joanna Burke appeared before, US District Judge Alfred Homer Bennett).

Counsel representing Deutsche Bank at Baker Donelson were instructed to submit arguments tailored specifically to Joanna Burke.

The timeline of this conspiracy is clear for all to see.

THIS IS DEUTSCHE BANK ET AL’S REMOVAL NOTICE….REPRESENTING AND ANSWERING FOR AVT TITLE…

16. Here, Plaintiff’s Complaint is entirely void of specific facts or actions taken by either AVT Title or Power Default which would create a basis for any claims against them. Both AVT Title and Power Default filed Verified Denials pursuant to Tex. Prop. Code Sec. 51.007. In those Verified Denials, both AVT Title and Power Default declared that they were not necessary parties to this case by reason of their reasonable belief that they were named as parties solely in their capacity as substitute trustee under the Deed of Trust. AVT Title is the Substitute Trustee appointed by the mortgagee in the Notice of Sale attached to the Complaint.19 Power Default sent Notice of Acceleration to Plaintiff on behalf of the mortgagee, also attached as an exhibit to the Complaint.20 This is the extent of the involvement of AVT Title and Power Default with the mortgage loan at issue in this case. As such, they are improperly joined defendants and their citizenship should be disregarded for diversity jurisdiction analysis.

So what does the timeline tell you exactly.

Setting aside the allegations of conspiracy between counsel for the defendants and the court, let’s interpret the laws of removal.

Here, in the state court proceedings, Samuels did not formally serve any of the Defendants. However, on Dec. 15, 2023 they voluntarily appeared and removed the case to federal court under the false guise of diversity jurisdiction and where their notice specifically states that AVT and Power Default (Mark Cronenwett as counsel) are improperly joined and should be disregarded.

After removal, the Catholic Bandit filed two pleadings. First, “MOTION to Dismiss Intervenor-Plaintiff Joanna Burke’s Claims by AVT Title Services, LLC” filed on Dec. 26 and the next day on Dec. 27; “SUPPLEMENT to 1 Notice of Removal, by AVT Title Services, LLC”.

The final JSU stated, in relevant part…

“Joanna Burke conferred with the parties only to request to be removed from this matter….Joana Burke, a party to this case, has the following other related cases….”

The document is titled;

4858-3391-4295 v.2 Joint Discovery Case Management Plan (Judge Bennett)

Let us not forget that Judge Shopping is a major issue in Texas courts right now and this case is a prime example of Deutsche Bank, PHH and the judiciary itself enabling it to persecute and maliciously target an elder widow because of her association with LIT’s founder, her son.

Before rising to the federal bench, Judge Al Bennett was a former state judge. Notably, he was also a judge in the prior state proceedings by Jeff Samuels, in his state courtroom in Harris County District Court. All this has previously been documented in a related LIT article, titled; “Terror in Texas Courts…”

As such, this has become more than a civil rights abuse, it has now escalated to a human rights abuse.

FROM DISSENTING SENIOR UNITED STATES DISTRICT JUDGE DAVID HAMILTON, 7TH CIRCUIT

Americans are justly proud of our constitutional protections of individual rights.

But the declaration of those rights in the Bill of Rights and the Thirteenth, Fourteenth, and Fifteenth Amendments is not sufficient grounds for satisfaction or self-congratulation. Many national constitutions announce similar protections of individual rights.

Those precious rights under the United States Constitution are meaningful because of our mechanisms to enforce them.

“The very essence of civil liberty certainly consists in the right of every individual to claim the protection of the laws, whenever he receives an injury.”

Bivens, 403 U.S. at 397, quoting Marbury v. Madison, 5 U.S. (1 Cranch) 137, 163 (1803);

accord, 3 William Blackstone, Commentaries on the Laws of England *23

(“where there is a legal right[,] there is also a legal remedy”).

An independent judiciary’s power to issue injunctions against federal (or state and local) agencies and officers to ensure compliance is a critical tool in making those declared constitutional rights real.

In many cases, however, an injunction would come too late to do any good for a victim of government abuse.

Doctrines of ripeness and standing also can prevent prospective injunctions without a clear threat that the plaintiff herself will again be a victim of the same conduct.

E.g., City of Los Angeles v. Lyons, 461 U.S. 95 (1983)

Defendants in criminal cases may invoke the exclusionary rule to prevent the use of unconstitutional techniques to obtain their conviction.

But for victims of government abuses who do not face prosecution or imminent repetition of the abuse, it is, as Justice Harlan wrote in Bivens, “damages or nothing.”

403 U.S. at 410 (Harlan, J., concurring in judgment).

In Egbert, Hernandez, and Abbasi, the Supreme Court opted for nothing.

As those cases are applied by the majority here and by some other circuits, a federal agent who violates the Constitution to carry out the policies of the federal executive branch now has little to fear in terms of direct accountability.

Sargeant v. Barfield, No. 21-2287, at *28-30 (7th Cir. Nov. 28, 2023)

TO THE HONORABLE JUDGE:

COMES NOW, Plaintiff JEFF SAMUELS hereby files his Motion for Remand and Incorporated Memorandum of Law. As grounds therefore, Plaintiff states as follows:

1.  On or about September 1, 2023, Jeff Samuels filed Plaintiff’s Application for Temporary Restraining Order and Injunctive Relief in 234th Judicial District Court, Harris County, Texas in Cause No. 2023-59141.

2.  On September 5, 2023, the trial court granted Plaintiff’s Application for Temporary Restraining Order and Injunctive Relief after posting a cash bond.

3.  On September 20, 2023, Plaintiff’s attorney filed motion to withdraw as counsel.

4.  On November 15, 2023, Defendant AVT filed an Original Answer and Verified Denial.

On November 20, 2023, state trial court granted Attorney Errol Jones motion to withdraw.

On November 30, 2023, 234th Judicial District Court signed a Docket Control/Scheduling Order in Cause No. 2023-59141.

5.  On December 15, 2023, Defendant AVT filed an untimely Notice of Removal in state & federal court.

See Defendants Notice of Removal (Dkt #1).

Plaintiff filed his Motion for Remand within thirty (30) days of AVT’s filing of its Notice of Removal.

Therefore, this Motion for Remand is timely.

6.  Jeff Samuels moves to remand on the basis that AVT and Power Default Service Inc were properly joined and lack of subject-matter jurisdiction.

I.

UNTIMELY NOTICE OF REMOVAL

A.  Standard Review-Notice of Removal.

7.  Removal from state court is governed by 28 U.S.C. § 1441. Section 1441 allows a defendant to remove “any civil action brought in a state court of which the district courts of the United States have original jurisdiction.”

28 U.S.C. § 1441.

The statute, which must be strictly construed, requires remand to state court if any doubt exists over whether removal is proper.

Abels v. State Farm Fire & Cas. Co., 770 F.2d 26, 29 (3d Cir. 1985).

8.  It is the rule in the Fifth Circuit that in cases involving multiple defendants, the 30-day removal period begins to run as soon as the first defendant is served.

Getty Oil v. Insurance Co. of North America, 841 F.2d 1254, 1262-63 (5th Cir.1988).

All served defendants must join in the removal, and because the notice of removal must be filed within 30 days of service on the first defendant, all served defendants must join in the removal no later than 30 days from the day on which the first defendant is served.

Getty Oil, 841 F.2d at 1254.

9.  On September 1, 2023, Plaintiff filed and served his Application for Temporary Restraining Order and Injunctive Relief on Defendants.

Defendant AVT’s Notice of Removal was due to be filed in federal court on or about September 25, 2023.

See 28 U.S. Code § 1446(b).

Thus, Defendant ATV’s notice of removal is untimely and so are Defendants Deutsche Bank National Trust Co., and Power Default Service, Inc. notice of removal are untimely.

See 28 U.S. Code § 1446(b).

B.    Standard Review-Removal Based on Federal Question.

10.  Removal of a state court action on the basis of a federal question is appropriate if the suit could have been brought in federal district court, as “founded on a claim or right arising under the Constitution, treaties or laws of the United States.”

28 U.S.C. § 1441(b).

11.  This federal jurisdiction only exists when a federal question is presented on the face of the plaintiff’s properly pleaded complaint.

Louisville & Nashville R. Co. v. Mottley, 211 U.S. 149 (1908).

12.  Under the “well-pleaded complaint” doctrine, Jeff Samuels is master of his claim and may avoid federal removal jurisdiction by exclusive reliance on state law.

Caterpillar Inc. v. Williams, 482 U.S. 386, 392, 96 L. Ed. 2d 318, 107 S. Ct. 2425 (1987).

When a plaintiff’s action is properly brought under state law, the defendant is not entitled to remove simply because federal law or principles of federal preemption will provide a defense, even a complete defense, to plaintiff’s state law claims.

Id. at 393.

13.  Additionally, the well-pleaded complaint rule bars a defendant from removing an action based on a counterclaim.

Indeed, “a counterclaim–which appears as part of defendant’s answer, not as part of the plaintiff’s complaint–cannot serve as the basis for ‘arising under’ jurisdiction.”

Warren G. Kleban Eng’g Corp. v. Caldwell, 490 F.2d 800, 802 n. 1 (5th Cir.1974) (noting that 1447(c) imposes a duty on district courts to inquire, on their own initiative, whether they have jurisdiction over a removed suit).

14.  Here, Plaintiff filed an Application for Temporary Restraining Order and Injunctive Relief.

Franchise Tax Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 27-28, 103 S.Ct. 2841, 2856, 77 L.Ed.2d 420 (1983).

Plaintiff’s foreclosure complaint in state court seeks exclusively state law remedies.

There are no federal questions implicated by the relief requested.

Further, nor did Plaintiff conceal federal questions that would have been clear in a well-pleaded complaint.

See Plaintiff’s Application.

15.  To the extent the Defendants may seek to allege that various defenses or counterclaims may arise under federal law, those defenses and counterclaims are irrelevant as to whether the complaint can be removed on the basis of a federal question.

As no federal question exists, Defendant cannot remove this matter on the basis of federal question jurisdiction.

C.  Standard Review- Removal Based on Diversity of Citizenship.

16.  Plaintiff herein incorporates the preceding paragraphs.

Similarly, as there is no federal question present, there is also no diversity of citizenship here, and this Court should remand this action to state court.

“When a complaint does not raise a question of federal law, a district court may properly exercise subject matter jurisdiction only if the amount in controversy exceeds the value of $75,000 and diversity exists among the adverse parties.”

See 28 U.S.C. § 1441(b).

17.  In their Notice of Removal, Defendant AVT admits that they “are citizens of Texas.”

See Notice of Removal at page 4 (Section B).

By their own admission, there is no doubt that Defendants are citizens of Texas.

Because they are clearly citizens of Texas and because Defendants’ underlying foreclosure action was brought in Harris County Court, Texas, Defendants cannot remove this case based on diversity jurisdiction.

As such, Section 1441(b)(2) plainly dictates that the action may not be removed and remand is not only appropriate, but required.

18.  Permitting the Defendants to litigate this case in federal court would open the federal courts to malpractice, breach of duty, and similar state law claim in which the allegation is that the defendant gave fraudulent or negligent promise based on an unreasonable or otherwise faulty interpretation of federal law.

See Plaintiff Application for Temporary Order (Loan Modification Process); see also Snook v. Deutsche Bank AG, 410 F.Supp.2d 519 (S.D. Tex. 2006).

CONCLUSION

18. Defendants have not presented a single legitimate basis for the removal of this matter.

Plaintiff Jeff Samuels is the master of his claim and chose state court. Defendants cannot and do not change that fact.

Rather, it seems clear that Defendants only purpose in removing this action is to cause unnecessary delay and needless increase to the cost of litigation.

Plaintiff therefore urges that the removal was interposed.

For the foregoing reasons, both under statutory law and on policy grounds, this Court should remand this case to the 234th Judicial District, Harris County, Texas.

Respectfully submitted,

SUPPLEMENT TO NOTICE OF REMOVAL

DEFENDANT AVT TITLE SERVICES, LLC’S ORIGINAL ANSWER AND VERIFIED DENIAL TO INTERVENOR-PLAINTIFF’S PETITION IN INTERVENTION

Defendant AVT Title Services, LLC, Substitute Trustee (“Defendant”) files this its Original Answer and Verified Denial and shows the Court as follows:

I.    GENERAL DENIAL

1.                  Pursuant to Rule 92 of the Texas Rules of Civil Procedure, Defendant generally denies each and every allegation contained in Intervenor-Plaintiffs Joanna Burke’s (“Intervenor­ Plaintiff’) Verified Petition in Intervention Seeking Declaratory Judgment with Application for Injunctive Relief by Joanna Burke (“Petition”), and any amendments or supplements thereto, and demands strict proof thereof.

II.  VERIFIED DENIAL

2.                  Defendant is not a necessary party to this cause of action by reason of its reasonable belief that it was named as a party solely in its capacity as a substitute trustee under a Deed of Trust as contemplated by Section 51.007 of the Texas Property Code.

Intervenor-Plaintiffs Petition demonstrates that all of its claims against Defendant relates to their alleged actions taken as a substitute trustee.

(See Petition).

Intervenor-Plaintiff brings a claim against Defendant for declaratory judgment and requests an injunction seeking only to restrain Defendant in its trustee capacity from proceeding with the subject foreclosure sale.

III.    AFFIRMATIVE DEFENSES

Defendant asserts the following affirmative defenses:

3.                  Defendant’s conduct or activity conformed at all times to any and all applicable state and federal statutes, codes, and regulations.

4.                  Any allegedly wrongful acts or omissions of Defendant, if and to the extent such acts and omissions occurred, were legally excused or justified.

5.                  Any alleged wrongful acts or omissions of Defendant, if and to the extent such acts or omissions occurred, were not intentional and resulted from a bona fide error.

6.                  Defendant is not liable for the acts, omissions, or conduct of other persons or entities not authorized to act on behalf of it; pleading further, and in the alternative, Defendant is not liable for the acts, omissions, or conduct of its agents who exceeded the scope of their authority.

7.                  Defendant’s actions and omissions were undertaken in good faith, with the absence of malicious intent to injure Intervenor-Plaintiff, and constitute lawful, proper and justified means

to further the business purposes of Defendant. Any purported conduct of individuals who were or are agents of Defendant were privileged, and those individuals were and are justified in engaging in the conduct attributed to them. Defendant pleads all statutory and common law privileges that may apply to its conduct and those of its agents.

8.                  Intervenor-Plaintiff’s claims are barred, in whole or in part, by the doctrines of judicial estoppel, collateral estoppel, quasi estoppel, contractual estoppel, equitable estoppel and res judicata.

9.                  Intervenor-Plaintiff has failed to mitigate her damages.

10.              Intervenor-Plaintiff’s damages, if any, were proximately caused by the acts, omissions, or breaches of other persons and entities, including Intervenor-Plaintiff, and the acts, omissions, or breaches were intervening and superseding causes oflntervenor-Plaintiff’s damages, if any.

11.              Intervenor-Plaintiff lacks clean hands to bring an action in equity.

12.              Intervenor-Plaintiff has failed to state a claim upon which relief may be granted.

WHEREFORE, PREMISES CONSIDERED, Defendant AVT Title Services, LLC prays that Intervenor-Plaintiff take nothing on her claims; Defendant recover its attorneys’ fees and costs; Defendant be dismissed from this case, and the Court award such other and further relief to which Defendant may be justly entitled at law or in equity.

Respectfully submitted,

By: Cheyenne D. Haley

MARKD. CRONENWETT
Texas Bar No. 00787303
mcronenwett@mwzmlaw.com

CHEYENNE D. HALEY
Texas Bar No. 24131883
chaley@mwzmlaw.com

MACKIE WOLF ZIENTZ & MANN, P.C.
14160 N. Dallas Parkway, Suite 900
Dallas, Texas 75254
(214) 635-2650 (Phone)
(214) 635-2686 (Fax)

Attorneys For Defendant AVT Title Services, LLC

PLEASE TAKE NOTICE THAT, pursuant to 28 U.S.C. §§ 1332, 1441 and 1446,

Defendants PHH Mortgage Corporation (“PHH”), Deutsche Bank National Trust Company, as Trustee for FFMLT TRUST 2004-FF3, Mortgage Pass-Through Certificates, Series 2004-FF3 (“Deutsche Bank”), and Power Default Services, Inc. (“Power Default”) filed removal papers with the Clerk of the United States District Court for the Southern District of Texas, Houston Division, regarding the above-styled action.

A copy of the Notice of Removal to Federal Court (without its accompanying exhibits) is attached hereto as Exhibit A and incorporated by reference.

Respectfully submitted,

BAKER, DONELSON, BEARMAN, CALDWELL & BERKOWITZ
A Professional Corporation

By: /s/ Emily Stroope

Emily Stroope
State Bar No. 24070692

Alexis del Rio
State Bar No. 24120796 5956
Sherry Lane, 20th Floor Dallas, Texas 75225

Telephone: (713) 650-9700
Facsimile: (713) 650-9701
estroope@bakerdonelson.com
adelrio@bakerdonelson.com

Attorneys for Defendant PHH Mortgage Corporation, Power Default Services Inc. and Deutsche Bank National Trust Company, as Trustee for FFMLT TRUST 2004-FF3, Mortgage Pass-Through Certificates, Series 2004-FF3

CERTIFICATE OF SERVICE

I certify that a true and correct copy of the foregoing has been forwarded in accordance with the Texas Rules of Civil Procedure on December 15, 2023, as follows:

Via e-mail Jeff.uben@gmail.com
and CMRRR No. 7022 3330 0000 7770 3774

Jeff Samuels, pro-se
14810 Winding Waters Drive
Cypress, TX 77429
Pro Se Plaintiff

Via e-mail joanna@2dobermans.com
and CMRRR No. 7022 3330 0000 7770 3798

Joanna Burke,
46 Kingwood Greens Dr
Kingwood, Texas 77339
Pro Se Intervenor

Via eFileTX

Mark D. Cronenwett
mcronenwett@mwzmlaw.com
Mackie Wolf Zientz & Mann, P.C.
14160 N. Dallas Parkway, Suite 900
Dallas, Texas 75254
Attorneys For Defendant
AVT Title Services, LLC

/s/ Emily Stroope

Emily Stroope

EXHIBIT “A”

CIVIL ACTION NO. 4:23-cv-4687
SD TEX.

DEFENDANTS’ NOTICE OF REMOVAL

Defendants PHH Mortgage Corporation (“PHH”), Deutsche Bank National Trust Company, as Trustee for FFMLT TRUST 2004-FF3, Mortgage Pass-Through Certificates, Series 2004-FF3 (“Deutsche Bank”), and Power Default Services, Inc. (“Power Default”) hereby give notice of the removal of the state court civil action described below on the basis of diversity jurisdiction. As grounds for the removal, PHH, Deutsche Bank, and Power Default respectfully state as follows:

I.                   INTRODUCTION

1.                  On June 1, 2023, Plaintiff Jeff Samuels (“Plaintiff”) filed his Application for Temporary Restraining Order and Injunctive Relief (“Complaint”) in the 234th Judicial District, Harris County, Texas numbered and styled as Cause No. 2023-59141, Jeff Samuels v. AVT Title Services LLC, Deutsche Bank National Trust Co., PHH Mortgage Corp., and Power Default Services, Inc.

2.                  In his Complaint, Plaintiff seeks injunctive relief to prevent foreclosure of the real property commonly known as 14810 Winding Waters Drive, Cypress, Texas 77429 (the “Property”).

Plaintiff also seeks actual damages and attorney’s fees and costs.

3.                  Defendant AVT Title Services, LLC filed its Original Answer and Verified Denial pursuant to Section 51.007 of the Texas Property Code on November 15, 2023.

4.                  An individual named Joanna Burke, a stranger to this mortgage loan and property, then filed a “Verified Petition in Intervention Seeking Declaratory Judgment with Application for Injunctive Relief.”

In this pleading, Ms. Burke states that she lives at 46 Kingwood Greens Drive, Kingwood, Texas 77339.

All of Ms. Burke’s exhibits reference the same property.

This is not the real property secured by the mortgage loan in this lawsuit.

Ms. Burke is not a borrower on the mortgage loan at issue in this case and does not allege that she has any connection to Plaintiff’s property or the subject mortgage loan.

In her pleading, Ms. Burke references a federal case in Minnesota in which she is the plaintiff.

5.                    PHH, Deutsche Bank, and Power Default filed their Original Answer on December 15, 2023.

Power Default included a Verified Denial pursuant to Section 51.007 of the Texas Property Code.

6.                  In accordance with 28 U.S.C. § 1446(a), copies of all process, pleadings, orders, and other papers filed in the state court action and obtained Defendants are attached hereto, marked as composite Exhibit “A,” and incorporated herein by reference.

II.                TIMELINESS OF NOTICE OF REMOVAL

7.                  PHH, Deutsche Bank, and Power Default have not been formally served with process as such this removal is timely pursuant to 28 U.S.C. § 1446(b)(1).1

III.             BASIS FOR REMOVAL: DIVERSITY JURISDICTION

8.                  This Court has original jurisdiction over this lawsuit pursuant to 28 U.S.C. § 1332 because it is between citizens of different states and the amount in controversy exceeds $75,000, exclusive of interest and costs, as discussed more fully below.

A.                Complete Diversity Exists.

9.                  Plaintiff is a resident and citizen of Harris County, Texas.2

10.              Deutsche Bank is a national banking association and trustee of a mortgage- securitization trust. When a trustee is the real party in interest to the suit, its citizenship controls for purposes of diversity jurisdiction.

A national banking association is considered a citizen of the state in which it is located, as determined by the state of its main office as set forth in its articles of association.3

Deutsche Bank’s main office as designated in its articles of association is in California. Accordingly, Deutsche Bank is a citizen of California.

11.              PHH is a New Jersey Corporation with its principal place of business located at 1 Mortgage Way, Mt. Laurel, New Jersey 08054. A corporation is a citizen of the state where it is

1 See 28 U.S.C. § 1446(b)(1). See also Thompson v. Deutsche Bank Nat’l Tr. Co., 775 F.3d 298, 303 (5th Cir. 2014) (citing Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 347-48, 119 S.Ct. 1322, 143 L.Ed. 448 (1999) (the federal removal and jurisdiction statutes “clearly provide that a defendant’s right to removal runs from the date on which it is formally served with process.”).

2 See Plaintiff’s Complaint; see also Hollinger v. Home State Mut. Ins. Co., 654 F.3d 564, 571 (5th Cir. 2011)

(For purposes of determining citizenship, “[e]vidence of a person’s place of residence [] is prima facie proof of his domicile.”).

3 Wachovia Bank, NA v. Schmidt, 546 U.S. 303, 318 (2006) (citing 28 U.S.C. § 1348).

incorporated and the state where it has its principal place of business.4

Therefore, for diversity purposes, PHH is a citizen of New Jersey.

12.              Because Plaintiff is a citizen of Texas and Deutsche Bank and PHH are not citizens of Texas, complete diversity exists between Plaintiff, Deutsche Bank, and PHH.

B.                 AVT Title Services, LLC and Power Default Services, Inc. are improperly joined parties and should be disregarded for diversity jurisdiction.

13.              Under Section 1441 (b), while complete diversity of citizenship must exist between plaintiff and all defendants to establish federal subject matter jurisdiction, only the citizenship of properly joined parties can establish federal subject matter jurisdiction.5

The doctrine of improper joinder “prevents defeat of federal removal jurisdiction premised on diversity jurisdiction by an improperly joined, non-diverse defendant.”6

Citizenship of an improperly joined defendant is disregarded entirely in determining whether complete diversity exists.7

“Normally, a court reviewing allegations of fraudulent joinder should refrain from conducting an evidentiary hearing but may utilize a summary judgment-like procedure.”8

The court may consider affidavits and deposition testimony filed with a defendant’s removal petition.9

14.              Improper joinder is established when the removing party meets the burden of showing either (1) there was actual fraud in pleading the jurisdictional facts or (2) the plaintiff is

4 28 U.S.C. § 1332(c)(1); Lincoln Prop. Co. v. Roche, 546 U.S. 81, 88-90 (2005).

5 28 U.S.C. § 1441(b); Smallwood v. Illinois Cent. R. Co., 385 F.3d 568, 572 (5th Cir. 2004).

6 Borden v. Allstate Ins. Co., 589 F.3d 168, 171 (5th Cir. 2009).

7 Smallwood, 385 F.3d at 572.

8 Delgado v. Shell Oil Co., 231 F.3d 165, 179 (5th Cir. 2000) (citing Burchett v. Cargill, 48 F.3d 173, 176 (5th Cir. 1995)).

9 TAJ Properties, LLC v. GAB Robins North America, Inc., H-10-4134, 2011 WL 2162321, at *2 (S.D. Tex. 2011) (citing Carriere v. Sears, Roebuck & Co., 893 F.2d 98, 100 (5th Cir. 1990)).

unable to establish a cause of action against the non-diverse defendant under state law.10

In order to establish the second ground for improper joinder, the removing party bears the burden of proving that there is “no reasonable basis for the district court to predict that the plaintiff might be able to recover against an in-state defendant.”11

The potential recovery “must be reasonable, not merely theoretical.”12

“[W]hether the plaintiff has stated a valid state law cause of action depends upon and is tied to the factual fit between the Plaintiff’s allegations and the pleaded theory of recovery.”13

15.              As the Fifth Circuit held in Int’l Energy Ventures Management, LLC v. United Energy Group, LTD., federal courts should use the federal pleading standard when conducting the rule 12(b)(6)-type analysis for an improper joinder claim to determine if the plaintiff has stated a claim against a non-diverse defendant.14

A plaintiff fails to state a claim on which relief may be granted as required under rule 12(b)(6) when a plaintiff’s factual allegations do not show a right to relief that is plausible and rises above mere speculation.15

“[A] complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.”16

To do so, the plaintiff must plead “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.”17 This plausibility standard “asks for more than a sheer possibility that a defendant has acted unlawfully.”18

10 Smallwood, 385 F.3d at 572; Cantor v. Wachovia Mortg., FSB, 641 F.Supp.2d 602, 606 (N.D. Tex. 2009); Rodriguez v. Casa Chapa S.A. de C.V., 394 F.Supp.2d 901, 905 (W.D. Tex. 2005).

11 Smallwood, 385 F.3d at 572.

12 Great Plains Trust Co. v. Morgan Stanley Dean Witter & Co., 313 F.3d 305, 312 (5th Cir. 2002).

13 Griggs v. State Farm Lloyds, 181 F.3d 694, 701 (5th Cir. 1999).

14 Smallwood, 385 f.3d at 572.

15 Ashcroft v. Iqbal, 556 u.s. 662, 677 (2009).

16 Id.

17 Id. at 678.

18 Id.

16.              Here, Plaintiff’s Complaint is entirely void of specific facts or actions taken by either AVT Title or Power Default which would create a basis for any claims against them.

Both AVT Title and Power Default filed Verified Denials pursuant to Tex. Prop. Code Sec. 51.007.

In those Verified Denials, both AVT Title and Power Default declared that they were not necessary parties to this case by reason of their reasonable belief that they were named as parties solely in their capacity as substitute trustee under the Deed of Trust.

AVT Title is the Substitute Trustee appointed by the mortgagee in the Notice of Sale attached to the Complaint.19 Power Default sent Notice of Acceleration to Plaintiff on behalf of the mortgagee, also attached as an exhibit to the Complaint.20

This is the extent of the involvement of AVT Title and Power Default with the mortgage loan at issue in this case.

As such, they are improperly joined defendants and their citizenship should be disregarded for diversity jurisdiction analysis.

C.                 The amount in controversy exceeds $75,000.00.

17.           Diversity jurisdiction is proper if “‘it is facially apparent’ from the plaintiffs’ complaint that their ‘claims are likely above [$75,000]’ . . .

If the value of the claims is not apparent, then the defendants ‘may support federal jurisdiction by setting forth the facts—[either] in the removal petition [or] by affidavit—that support a finding of the requisite amount.’”21

Diversity jurisdiction exists where a removing defendant establishes by a preponderance of the evidence that the amount in controversy exceeds $75,000.22

18.              The Fifth Circuit has held that “in actions seeking declaratory or injunctive relief, it is well established that the amount in controversy is measured by the value of the object of the

19 See Notice of Trustee Sale, Exhibit C to Complaint.

20 See Notice of Acceleration of Loan Maturity, Exhibit E to Complaint.

21 Govea v. JPMorgan Chase Bank, N.A., No. CIV.A. H-10-3482, 2010 WL 5140064, at *2 (S.D. Tex. Dec. 10, 2010)

(quoting Garcia v. Koch Oil Co. of Tex. Inc., 351 F.3d 636, 639 (5th Cir. 2003) (quoting Allen v. R & H Oil & Gas Co., 63 F.3d 1326, 1335 (5th Cir. 1995))).

22 Garcia, 351 F.3d at 638-39 (quoting De Aguilar v. Boeing Co., 11 F.3d 55, 58 (5th Cir. 1993)).

litigation.”23

When “a right to property is called into question in its entirety, the value of the Property controls the amount in controversy.”24

And, where the “object of the mortgagor’s litigation [is] the protection of his entire property,” the fair market value of the property is the proper measure of the amount in controversy.25

19.              When a plaintiff seeks a declaration that the mortgagee is barred from foreclosing on its interest in the property, it calls into question a right to the property in its entirety and the amount in controversy is equal to the value of the property.26

Additionally, the Fifth Circuit held that [i]n actions enjoying a lender from transferring property and preserving an individual’s ownership interest, it is the property itself that is the object of the litigation; the value of that property represents the amount in controversy.”27

20.              Here, Plaintiff seeks injunctive relief to prevent Deutsche Bank and PHH from selling the subject real property at foreclosure.

Therefore, the fair market value of the property is the proper measure of the amount in controversy. The property has a value of $476,358.28 As such, the amount is controversy is $476,358.

23 Farkas v. GMAC Mortg., L.L.C., 737 F.3d 338, 341 (5th Cir. 2013) (citing Hunt v. Wash. State Apple Adver. Comm’n, 432 U.S. 333, 347 (1977)).

24 McDonald v. Deutsche Bank Nat’l Trust Co., as trustee, No. 3:11-cv-2691, 2011 WL 6396628 at *2 (N.D. Tex. Dec. 20, 2011) (quoting Waller v. Prof’l Ins. Corp., 296 F.2d 545,547-48 (5th Cir. 1961)); see also Leininger v. Leininger, 705 F.2d 727, 729 (5th Cir., 1983) (“In actions seeking declaratory or injunctive relief, the amount in controversy is measured by the value of the object of the litigation.”).

25 Martinez v. BAC Home Loans Servicing, L.P., No. SA-09-CA-951, 2010 WL 6511713, at *7 (W.D. Tex. Sep. 24, 2010).

26 Bardwell v. BAC Home Loans Servicing, LP, No. 3:11-cv-1002-B, 2011 WL-4346328, at *2 (N.D. Tex. Sept. 16, 011) (holding the amount in controversy is equal to the value of the property when plaintiff was seeking a declaration that defendant was barred from foreclosing on its interest the property); see also Hayward v. Chase Home Finance, LLC, 2011 WL 2881298, *4–5 (N.D. Tex. July 8, 2011).

27 Id.

28 See Harris County Appraisal District Summary attached as Exhibit “B”. It is appropriate for the court to take judicial notice of this document because it is a public record and the information it provides is readily ascertainable and the source—the Harris County Appraisal District—cannot reasonably be questioned. See Funk v. Stryker, 631 F.3d 777, 783 (5th Cir. 2011).

IV.             VENUE

21.              Venue for this removal is proper in the United States District Court for the Southern District of Texas, Houston Division, because this district and division includes Harris County, Texas—the location of the pending state court action.29

V.                ADDITIONAL REQUIREMENTS

22.              Written Notice of Removal will be provided to Plaintiff and filed with the District Clerk of Hidalgo County, Texas.

23.              In the event that Plaintiff seeks to remand this case, or the Court considers remand sua sponte, PHH, Deutsche Bank, and Power Default respectfully request the opportunity to submit such additional argument or evidence in support of removal as may be necessary.

24.              Plaintiff did not make jury demand in the Complaint.

25.              WHEREFORE, having satisfied the requirements for removal, PHH, Deutsche Bank, and Power Default give notice that Cause No. 2023-59141 originally filed in Harris County District Court styled Jeff Samuels v. AVT Title Services, LLC, Deutsche Bank National Trust Co., PHH Mortgage Corp., and Power Default Services, Inc. is effectively removed to this Court.

29 See 28 U.S.C. § 1441(a); 28 U.S.C. § 124(b) (stating that the Houston Division of the Southern District includes Harris County).

Respectfully submitted,

By: /s/ Emily Stroope

Emily Stroope
State Bar No. 24070692

Alexis del Rio
State Bar No. 24120796

Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C.
5956 Sherry Lane, 20th Floor Dallas, Texas 75225

Telephone: (713) 650-9700

Facsimile: (713) 650-9701
estroope@bakerdonelson.com
adelrio@bakerdonelson.com

Attorneys for Defendants PHH Mortgage Corporation, Power Default Services, Inc., and Deutsche Bank National Trust Company, as Trustee for FFMLT TRUST 2004-FF3, Mortgage Pass-Through Certificates, Series 2004-FF3

CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of the foregoing document has been served upon counsel of record pursuant to the Federal Rules of Civil Procedure on December 15, 2023, as indicated below:

/s/ Emily Stroope

Emily Stroope

U.S. District Court
SOUTHERN DISTRICT OF TEXAS (Houston)
CIVIL DOCKET FOR CASE #: 4:23-cv-04687

RECAP Actions

TO THE COURT AND ALL PARTIES:

Please take notice that the undersigned and the law firm of MACKIE WOLF ZIENTZ & MANN, P.C., hereby appear as additional counsel Defendant AVT Title Services, LLC, Substitute Trustee (“Defendant”), and request all notices given or required to be given in this case, and all papers served or required to be served in this case, including, without limitation, notices and any orders, applications, complaints, demands, hearings, motions, petitions, pleadings or requests, and any other documents brought before this Court in this case, whether formal or informal, whether written or oral, and whether transmitted or conveyed by mail, telephone, facsimile or otherwise be served upon the undersigned attorney at the following address:

Cheyenne D. Haley
MACKIE WOLF ZIENTZ & MANN, P.C.

14160 N. Dallas Parkway, Suite 900
Dallas, Texas 75254
Telephone: (214) 635-2650
Facsimile: (214) 635-2686
Email: chaley@mwzmlaw.com

Respectfully submitted,

By: /s/ Cheyenne D. Haley

MARK D. CRONENWETT
Texas Bar No. 00787303
mcronenwett@mwzmlaw.com

CHEYENNE D. HALEY
Texas Bar No. 24131883
chaley@mwzmlaw.com

MACKIE WOLF ZIENTZ & MANN, P.C.
14160 N. Dallas Parkway, Suite 900
Dallas, Texas 75254
(214) 635-2650 (Phone)
(214) 635-2686 (Fax)

Attorneys For Defendant AVT Title Services, LLC