Paula Johnson vs Elizabeth R. Wellborn, P.A., Morris Laing Evans Brock & Kennedy CHTD. ( 2011 )

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
FILED
U.S. COURT OF APPEALS
No. 10-12494 ELEVENTH CIRCUIT
MARCH 17, 2011
Non-Argument Calendar
JOHN LEY
________________________ CLERK
D.C. Docket No. 0:09-cv-61685-KAM
PAULA JOHNSON,
Plaintiff-Appellant,
versus
ELIZABETH R. WELLBORN, P.A.,
MORRIS LAING EVANS BROCK & KENNEDY CHTD.,
Defendants-Appellees.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(March 17, 2011)
Before EDMONDSON, HULL and PRYOR, Circuit Judges.
PER CURIAM:
Paula Johnson appeals pro se the district court’s denial of her motion to
remand and the dismissal of her pro se amended complaint. After review, we
affirm.
I. BACKGROUND
A. Original State Court Complaint and Removal
Johnson’s action arose out of an attempt to obtain a mortgage loan
modification with Ocwen Loan Servicing, LLC (“Ocwen”) in March 2009.
Johnson, a citizen of Illinois, filed her original pro se complaint in a Florida state
court against defendants Elizabeth R. Wellborn, P.A. (“Wellborn”) and Rick A.
Kear of the Law Offices of Morris, Laing, Evans, Brock & Kennedy, Chtd.
(“Kear”), whom Johnson alleged were debt collectors and agents of Ocwen.
Johnson’s original complaint asserted claims under the Fair Housing Act
(“FHA”) regulations, 24 C.F.R. § 100.120, the Fair Debt Collection Practices Act
(“FDCPA”), 15 U.S.C. §§ 1692c-1692p, and state law. Johnson sought over
$250,000 in damages and a preliminary injunction. Johnson attached a certificate
of service to her complaint. The certificate stated that she had “forwarded” a copy
of “this Petition and a NOTICE OF COMMENCEMENT OF ACTION-WAIVER
OF SERVICE OF PROCESS . . . to Defendants, electronically via Email delivery
on September 27, 2009,” and listed e-mail addresses and Florida mailing addresses
for each defendant.
2
Defendant Wellborn removed the action to the federal district court in
Miami. Wellborn’s notice of removal stated that: (1) the basis for removal was
federal question jurisdiction under 28 U.S.C. § 1331, diversity jurisdiction under
28 U.S.C. § 1332 and supplemental jurisdiction under 28 U.S.C. § 1367; (2)
complete diversity existed between Johnson and the defendants and the amount in
controversy exceeded $75,000;1 and (3) because the other defendant, Kear, had not
been served, Wellborn did not need his consent to removal.
B. First Motion to Dismiss
Defendant Wellborn then filed a motion to dismiss Johnson’s complaint,
pursuant to Federal Rule of Civil Procedure 12(b)(1), because Johnson was not a
party to the mortgage loan and lacked standing to sue. According to the motion to
dismiss, Johnson’s mother was the borrower on the mortgage loan.
C. Motion to Remand
Plaintiff Johnson did not respond to Defendant Wellborn’s motion to
dismiss, but instead filed a motion to remand the action to state court. Johnson
argued that removal by an in-state defendant based on diversity jurisdiction
violated 28 U.S.C. § 1441(b). Johnson also averred that she sent copies of the
1
Wellborn’s notice of removal stated that Wellborn was a Florida law firm and a citizen
of Florida and that Morris Laing was a law firm in Kansas.
3
complaint and waiver of service of process to both defendants via the U.S. Postal
Service and electronically via e-mail.
The district court denied Johnson’s motion to remand, finding that removal
properly rested on federal question jurisdiction because Johnson’s complaint
alleged violations of federal law (the FHA and the FDCPA). The district court
entered an order directing Johnson to show cause by December 7, 2009 why
Wellborn’s motion to dismiss should not be granted.
D. Amended Complaint
On December 7, 2009, Johnson filed a response to the show cause order
stating that she had not received Wellborn’s motion to dismiss. On the same day,
Johnson filed an amended complaint that (1) omitted the two federal claims and
alleged only state law claims; and (2) stated that it was filed in response to
Wellborn’s motion to dismiss.
According to Johnson’s amended complaint, Johnson resides at 715 North
24th Street in East Saint Louis, Illinois. Johnson is also “on the Deed and all
property Tax and property Insurance documents.” Ocwen holds the loan on the
property, which is higher than the property’s value. Defendants Wellborn and
Kear are “debt collectors and agents” for Ocwen and are the only contact between
Johnson and Ocwen.
4
On March 13, 2009, the Defendants, on behalf of Ocwen, “entered into a
‘Loan Modification Offer’” with Johnson.2 Under the terms of the agreement,
Johnson was required to send Ocwen $600, which she did in a timely fashion in
March 2009. After Ocwen received the payment, however, the loan modification
was “denied without explanation.” Johnson was “unable to find out where the
$600.00 was posted” or “where any of the Payments . . . ha[d] been posted.”
Because Johnson had sent payments by certified mail, her only confirmation that
her payments were received was the return receipt signature cards.
On July 31, 2009, Johnson signed a contract with a non-profit “home-
save/home-refinance Agency,” N.A.C.A., which began contacting Ocwen and the
Defendants. Meanwhile, the Defendants verbally informed Johnson that no
modification or refinance proposals would be considered. In a written letter,
Ocwen told Johnson that the loan was not assumable.
2
Johnson later filed a copy of this Offer, which was made by Wellborn on behalf of
Ocwen to settle a separate lawsuit Johnson had filed against Ocwen. Wellborn represented
Ocwen in this other litigation. Wellborn’s March 13, 2009 Offer letter is addressed to Ida Mae
Johnson, Plaintiff Paula Johnson’s mother. The Offer letter states that Ocwen will modify the
existing mortgage if Ida Mae Johnson makes a down payment of $600 to Ocwen by March 18,
2009, and both Ida Mae and Paula Johnson sign a settlement and release agreement. Under the
modified mortgage, monthly payments of $544.46 would begin on April 15, 2009. The Offer
letter warned that the offer was valid only until March 18, 2009, after which Ocwen would
proceed with litigation.
5
Johnson’s amended complaint alleged that, to date, she had been unable to
learn why the loan modification had been denied; why the loan was not assumable;
why the loan could not be refinanced with N.A.C.A.; where the original $600
payment and the monthly payments had been posted; whether there were any
accrued fees; and what the outstanding loan balance was. Johnson was “unable to
gain ‘access’” to Ocwen’s website and, when she called Ocwen, she was told all
contact had to be made through the Defendants.
Johnson’s amended complaint contained three counts. Count I alleged that
Defendants Wellborn and Kear tortiously interfered with her contract with
N.A.C.A. Count I also alleged: (1) that Wellborn and Kear, as attorneys, were
liable to third parties where their services aided Ocwen’s illegal activities (such as
fraud and misrepresentation); (2) that Wellborn and Kear through “negligent acts
and omissions that breached a duty the attorney owed,” which injured Johnson;
and (3) that “[t]he fraudulent misrepresentation of the March 13, 2009
‘Modification Offer’ and the interference with the ‘NACA Loan Modification and
Refinance’ ha[d] directly caused [Johnson] to be in a position that she will not be
able to recover from Foreclosure Status.”
Count II alleged that the Defendants, as joint tortfeasors, bore liability under
the Illinois Joint Tortfeasor Contribution Act (“IJTCA”). Count III requested a
6
preliminary injunction to enjoin the Defendants from further tortious interference
with Johnson’s contractual relationship with N.A.C.A, “or any other home-save or
home refinance agency or financial institution.”3 Count III also listed these claims
against the Defendants, which were the “cause for [Johnson] to request a
Preliminary Injunction”: “breach of contract, breach of fiduciary duty, conspiracy
to breach fiduciary duty, tortious interference, conspiracy to tortious interference,
fraud or alternatively negligent misrepresentation, conspiracy to fraud, fraudulent
transfer, conversion, legal malpractice, negligence, unjust enrichment, and
alternatively promissory estoppel or quantum meruit.”
E. Second Motion to Dismiss
In light of Johnson’s amended complaint, the district court denied
Wellborn’s motion to dismiss as moot. Wellborn then filed a motion to dismiss
the amended complaint, arguing again that Johnson lacked standing to sue because
she was not a party to the loan. Wellborn’s motion further contended that, because
Johnson was not a tortfeasor, she had no standing to bring her state-law IJTCA
claim. The district court ordered Johnson to show cause why Wellborn’s second
motion to dismiss should not be granted.
F. Second Motion to Remand
3
Johnson’s amended complaint mislabeled this count as Count IV.
7
Johnson never responded to the district court’s order or to Wellborn’s
second motion to dismiss.
Instead, Johnson filed a second motion to remand her case to state court.
Johnson argued, inter alia, that: (1) the claims in her amended complaint arose
under state law, the parties were non-diverse and, consequently, subject-matter
jurisdiction was lacking; (2) Defendant Wellborn’s removal violated 28 U.S.C.
§ 1441(b) because Wellborn was a citizen of Florida; and (3) Defendant Kear
failed to file a responsive pleading even though Johnson had served with him with
notice of her action electronically and by U.S. First Class mail.
The district court denied Johnson’s second motion to remand. The district
court explained that Johnson could not rely on her amended complaint to defeat
federal question jurisdiction because her original complaint, alleging federal
claims, was properly removed to federal court.
G. Dismissal Order Granting Wellborn’s Second Motion to Dismiss
After setting the trial date, scheduling discovery and referring the case for
mediation, the district court granted Wellborn’s second motion to dismiss. The
district court did not address Wellborn’s standing argument, but instead concluded
that Johnson’s amended complaint failed to state a claim for which relief could be
granted.
8
The district court first noted that Johnson had failed to respond to
Wellborn’s second motion to dismiss or the court’s show cause order to do so. As
to the tortious interference claim in Count I, the district court emphasized that
Johnson did not allege she was a borrower on the mortgage or that she had any
contractual relationship with Ocwen. Rather, Johnson’s contract was with
N.A.C.A., and the amended complaint did not allege any acts by the Defendants
that prevented N.A.C.A. from fulfilling its contractual obligations to try to obtain
a loan modification for Johnson.
The district court dismissed the IJTCA claim in Count II because the
amended complaint did not allege that Johnson was a tortfeasor entitled to
contribution. Finally, the district court dismissed Count III, concluding that,
because Johnson failed to state a claim in her first two counts, she could not seek
an injunction based on these claims. Johnson pro se appealed.
II. DISCUSSION
A. Motion to Remand
A defendant may remove to federal court an action filed in state court based
on either diversity or federal question jurisdiction. 28 U.S.C. § 1441(a), (b). The
removing defendant bears the burden to show the existence of federal subject-
9
matter jurisdiction. Pacheco de Perez v. AT&T Co., 139 F.3d 1368, 1373 (11th
Cir. 1998).
Federal question jurisdiction exists if the plaintiff’s action “arises under” the
“Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331.
Generally, an action “arises under” federal law when federal law creates the cause
of action. Pacheco de Perez, 139 F.3d at 1373. Where a defendant properly
removes an action to federal court on the basis of federal question and
supplemental jurisdiction, the district court “ha[s] discretion to retain jurisdiction
over the state law claims even after [the plaintiff] amend[s] the complaint to
remove any federal cause of action.” Behlen v. Merrill Lynch, 311 F.3d 1087,
1095 (11th Cir. 2002).4
Here, Defendant Wellborn removed Johnson’s action based on both
diversity and federal question jurisdiction. Johnson’s original complaint (filed in
state court) alleged claims under the FHA and the FDCPA in addition to state law
claims. Thus, federal question jurisdiction existed at the time Wellborn filed its
notice of removal. The fact that Johnson later amended her complaint to remove
4
We review de novo a district court’s denial of a motion to remand. Moore v. N. Am.
Sports, Inc., 623 F.3d 1325, 1328 (11th Cir. 2010).
10
the federal claims did not defeat the district court’s removal jurisdiction over her
supplemental state law claims. See Behlen, 311 F.3d at 1095.5
There is no merit to Johnson’s argument that removal was improper because
Kear did not consent to it. The requirement that there be unanimity of consent in
removal cases with multiple defendants does not require consent of defendants
who have not been properly served. See Bailey v. Janssen Pharmaceutica, Inc.,
536 F.3d 1202, 1208 (11th Cir. 2008) (“[A] defendant has no obligation to
participate in any removal procedure prior to his receipt of formal service of
judicial process.”).
There is no evidence in the record that Kear was ever properly served, either
while the action was in state court or after it was removed to federal court. Nor is
there evidence Kear waived service. Johnson maintains that she “served” Kear by
sending him copies of her complaint and a waiver of service of process via e-mail
and U.S. mail on September 27, 2009. This does not constitute proper service of
process under either Florida or federal law. See Fla. Stat. § 48.031 (providing that
5
Because Wellborn’s removal was properly based on federal question jurisdiction, it did
not violate 28 U.S.C. § 1441(b)’s forum-defendant rule even though Wellborn is a citizen of
Florida. See 28 U.S.C. § 1441(b) (stating that a claim based on federal question jurisdiction is
“removable without regard to the citizenship or residence of the parties”); Moore, 623 F.3d at
1328 (explaining that, under § 1441(b), an action “cannot be removed on the basis of diversity
jurisdiction if a defendant is a citizen of the State in which such action is brought” (quotation
marks omitted)).
11
service of process is made by delivering a copy of the complaint to the person to
be served or leaving the copy at the person’s usual place of abode with a person
who resides there and who is fifteen years of age or older); Fed. R. Civ. P. 4(e)
(requiring service of the summons and complaint by following the law of the
forum state; delivering a copy of the summons and complaint to the defendant
personally; leaving the copies at the defendant’s dwelling or usual place of abode
with someone of suitable age and discretion who resides there; or delivering
copies to the defendant’s agent for service of process).
Because Defendant Kear was not properly served, Defendant Wellborn did
not need his consent to remove Johnson’s action to federal court.6
B. Dismissal for Failure to State a Claim
To avoid dismissal for failure to state a claim under Federal Rule of Civil
Procedure 12(b)(6), a complaint must allege “enough facts to state a claim to relief
that is plausible on its face” and that rises “above the speculative level.” Speaker
v. U.S. Dep’t of Health & Human Servs., 623 F.3d 1371, 1380 (11th Cir. 2010)
(quotation marks omitted). “A claim has facial plausibility when the plaintiff
6
Because Kear was not properly served and did not waive service, the district court could
not have required Kear to file a responsive pleading and participate in the action, as Johnson
suggests. See Murphy Bros., Inc., v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 350, 119 S. Ct.
1322, 1327 (1999).
12
pleads factual content that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.” Id. (quotation marks and
brackets omitted). We agree with the district court that Johnson’s amended
complaint failed to state a claim for which relief could be granted.7
Under Florida law, to state a claim of tortious interference with a
contractual relationship, a plaintiff must allege “(1) the existence of a business
relationship or contract to which a plaintiff is a party; (2) the defendant’s
knowledge of the contract; (3) the defendant’s intentional procurement of the
contractual breach; (4) the absence of justification or privilege; and (5) [that] the
plaintiff suffered damages from the breach.” Fernandez v. Haber & Ganguzza,
LLP, 30 So. 3d 644, 646 (Fla. Dist. Ct. App. 2010). The amended complaint
alleges that Plaintiff Johnson contracted with N.A.C.A. (denoted the “home-
save/home-refinance Agency”) to seek a loan modification from Ocwen, but that
Ocwen denied modification without explanation and refused to allow Johnson to
assume her mother’s loan. Even assuming arguendo that the other elements were
met, the amended complaint does not allege that the N.A.C.A. contract was
7
We review de novo a district court’s dismissal under Rule 12(b)(6), “accepting the
allegations in the complaint as true and construing them in the light most favorable to the
plaintiff.” Am. Dental Ass’n v. Cigna Corp., 605 F.3d 1283, 1288 (11th Cir. 2010) (quotation
marks omitted).
13
breached. On the face of the complaint. N.A.C.A. was not obligated to actually
obtain the loan modification from Ocwen. In any event, even if N.A.C.A.
breached the contract by failing to obtain the loan modification, the amended
complaint does not allege that the Defendants procured that breach.
Johnson’s amended complaint also refers to a loan modification offer
pursuant to which Ocwen received $600 from Johnson, but then denied the loan
modification without explanation. Even construing these allegations in Johnson’s
amended complaint liberally, they do not state a claim of tortious interference. To
state a tortious interference claim, the interfering defendant must be a third party
and a stranger to the business relationship; an employee or agent acting on behalf
of a contracting party’s interests cannot be liable. See Sloan v. Sax, 505 So. 2d
526, 527-28 (Fla. Dist. Ct. App. 1987). Johnson’s amended complaint alleges that
the Defendants were Ocwen’s agents and does not allege that they were acting
against the interests of their client, Ocwen. Thus, the Defendants were not
strangers to any agreement between Ocwen and Johnson to modify the loan.8
8
To the extent these allegations are construed as a claim of breach of contract, they also
fail. Under Florida law, an agent is not liable for a disclosed principal’s obligations under a
contract that the agent negotiated or executed on behalf of the principal. Babul v. Golden Fuel,
Inc., 990 So. 2d 680, 683 (Fla. Dist. Ct. App. 2008). Thus, to the extent Johnson alleges that
Ocwen breached the loan modification offer, the Defendants cannot be held liable.
14
With respect the IJTCA claim, that state Act provides for a right of
contribution among two or more joint tortfeasors. 740 Ill. Comp. Stat. 100/2(a).
The contribution right “exists only in favor of a tortofeasor who has paid more
than his pro rata share of the common liability.” Id. 100/2(b); see Muirfield
Village-Vernon Hills, LLC v. K. Reinke, Jr. & Co., 810 N.E.2d 235, 244-45 (Ill.
App. Ct. 2004). Johnson’s amended complaint does not allege any facts to suggest
she is a joint tortfeasor who has a right of contribution against the Defendants
under the IJTCA.
Because the amended complaint’s allegations do not support any
substantive claims, Johnson was not entitled to receive an injunction based on
these claims.9 See Hall v. Hanford, 64 So. 2d 303, 304 (Fla. 1953) (concluding
that when the complaint is dismissed, there is nothing before the court upon which
a temporary injunction can issue); see also Klay v. United Healthgroup, Inc., 376
F.3d 1092, 1097 (11th Cir. 2004) (“For a traditional injunction to be even
9
Johnson’s amended complaint listed within Counts II and III other state law claims, but
did not allege any facts to support them. Additionally, Count II alleged that the Defendants, as
attorneys, were liable for fraudulent misrepresentation as to the March 13, 2009 loan
modification offer, but did not state what was misrepresented or how the Defendants participated
in the misrepresentation. Accordingly, the district court properly dismissed these state law
claims. See Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 1964-65
(2007) (explaining that although a complaint does not need to contain detailed factual
allegations, it must contain enough factual allegations to rise above the level of speculation); Fed.
R. Civ. P. 8.
15
theoretically available, a plaintiff must be able to articulate a basis for relief that
would withstand scrutiny under [Rule] 12(b)(6) . . . .”).
III. CONCLUSION
For these reasons, the district court did not err in denying Johnson’s motion
to remand the case to state court or in dismissing Johnson’s amended complaint
for failure to state a claim.10
AFFIRMED.
10
There is no merit to Johnson’s argument that the district court’s dismissal improperly
obstructed the previously scheduled discovery and mediation. Where there are no legally
supportable claims, the district court may properly terminate a case before discovery or other pre-
trial proceedings. See, e.g., Chudasama v. Mazda Motor Corp., 123 F.3d 1353, 1368 (11th Cir.
1997).
16