Maitland v. Fishbein

17-1142-cv
Maitland v. Fishbein, et al.
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY
ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF
APPELLATE PROCEDURE 32.1 AND THIS COURT=S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER
IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION ASUMMARY ORDER@). A PARTY CITING TO A SUMMARY
ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Second Circuit,
held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of
New York, on the 26th day of February, two thousand eighteen.
PRESENT:
BARRINGTON D. PARKER,
PETER W. HALL,
RAYMOND J. LOHIER, JR.,
Circuit Judges.
_____________________________________
Edson Maitland, Yvonne Maitland,
Plaintiffs-Appellants,
v. No. 17-1142-cv
Lisa Fishbein, Robert Fishbein,
JPMorgan Chase Bank, N.A.,
Defendants-Appellees,
Select Portfolio Servicing, Inc.,
Defendant.
_____________________________________
FOR APPELLANTS: EDSON MAITLAND, Yvonne Maitland, pro se, Palm
Coast, FL.
FOR LISA AND ROBERT FISHBEIN: ANDREW S. MULLER, Platzer, Swergold, Levine,
Goldberg, Katz & Jaslow, LLP, New York, NY.
FOR JPMORGAN CHASE BANK, N.A.: BRIAN P. SCIBETTA, Buckley Madole, P.C., New
York, NY.
Appeal from a judgment of the United States District Court for the Eastern District of
New York (Azrack, J.; Tomlinson, M.J.).
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND
DECREED that the judgment of the district court is AFFIRMED IN PART and VACATED IN
PART, and that this case is REMANDED to the district court for further proceedings consistent
with this opinion.
Appellants Edson and Yvonne Maitland, proceeding pro se, appeal from a judgment in
favor of Lisa and Robert Fishbein and JPMorgan Chase Bank, N.A. (Chase). The Maitlands
asserted federal claims, including a claim under the Racketeer Influenced and Corrupt
Organizations Act (RICO), 18 U.S.C. §§ 1961–1968, as well as state law claims sounding in fraud.
Following a magistrate judge’s report and recommendation, the district court dismissed the federal
claims for failure to state a claim, concluded that the Maitlands failed to allege diversity
jurisdiction, and declined to exercise supplemental jurisdiction over their state law claims. This
appeal follows. We assume the parties’ familiarity with the underlying facts, the procedural
history of the case, and the issues on appeal.
We review de novo the dismissal of a complaint pursuant to Federal Rule of Civil
Procedure 12(b)(6), accepting all factual allegations as true and drawing all reasonable inferences
in the plaintiff’s favor. Biro v. Condé Nast, 807 F.3d 541, 544 (2d Cir. 2015). The complaint
must plead “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007); see also Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Although a court must accept as true all the factual allegations in the complaint, that requirement
is “inapplicable to legal conclusions.” Iqbal, 556 U.S. at 678.
2
As an initial matter, the Maitlands have waived appellate review of their RICO claim
against the Fishbeins by failing to object to the portion of the magistrate judge’s February 28, 2017
report and recommendation addressing that claim despite being notified of the consequences of
their failure to do so.1 See Cephas v. Nash, 328 F.3d 98, 107 (2d Cir. 2003). Although we have
discretion to excuse that waiver “in the interests of justice,” Thomas v. Arn, 474 U.S. 140, 155
(1985); Cephas, 328 F.3d at 107, “[s]uch discretion is exercised based on, among other factors,
whether the defaulted argument has substantial merit or, put otherwise, whether the magistrate
judge committed plain error in ruling against the defaulting party,” Spence v. Superintendent,
Great Meadow Corr. Facility, 219 F.3d 162, 174 (2d Cir. 2000). Upon review, we conclude that,
even were we to excuse the Maitlands’ failure to object to the relevant portions of the magistrate
judge’s report and recommendation, we would nonetheless affirm for substantially the reasons
stated by the magistrate judge.
On appeal, the Maitlands primarily argue that the district court possessed diversity
jurisdiction over their state law claims and erred when it dismissed their claims for want of
diversity jurisdiction (having declined to exercise supplementary jurisdiction following dismissal).
“For purposes of diversity jurisdiction, a party’s citizenship depends on his domicile.” Linardos
v. Fortuna, 157 F.3d 945, 948 (2d Cir. 1998). “[E]stablishing one’s domicile in a state generally
requires both physical presence there and intent to stay.” Universal Reinsurance Co. v. St. Paul
Fire & Marine Ins. Co., 224 F.3d 139, 141 (2d Cir. 2000). The magistrate judge properly
concluded, in a report and recommendation adopted in its entirety by the district court, that the
Maitlands failed to adequately plead diversity jurisdiction. The complaint alleged only that the
1
Further, the Maitlands have abandoned all their remaining federal claims by failing to address
them in their appellate brief. See LoSacco v. City of Middletown, 71 F.3d 88, 92–93 (2d Cir.
1995).
3
Maitlands resided in Florida, the Fishbeins resided in New York, and Chase’s main office was in
New York. This was insufficient to show that the Maitlands were domiciled in, and thus citizens
of (within the meaning of 28 § U.S.C. 1332), Florida, especially considering that their lawsuit
involved a property they owned in New York. See, e.g., Leveraged Leasing Admin. Corp. v.
PacifiCorp Capital, Inc., 87 F.3d 44, 47 (2d Cir. 1996) (“It is . . . clear that a statement of the
parties’ residence is insufficient to establish their citizenship.”).
However, “[a] failure to allege facts establishing jurisdiction need not prove fatal to a
complaint.” Canedy v. Liberty Mut. Ins. Co., 126 F.3d 100, 103 (2d Cir. 1997). Federal law
provides that “[d]efective allegations of jurisdiction may be amended, upon terms, in the trial or
appellate courts.” 28 U.S.C. § 1653. As such, when the record supports a factual basis for
diversity, leave to correct a technical defect is freely given. See Canedy, 126 F.3d at 103.
“Unless the record clearly indicates that the complaint could not be saved by any truthful
amendment, we generally afford an opportunity for amendment.” Id. (citation omitted).
Having reviewed the entire record and the Maitlands’ filings in this Court, we conclude
that they have now alleged an adequate basis for diversity jurisdiction. The Maitlands moved to
Florida in 2010, have had Florida driver’s licenses since before their complaint was filed, have
advised us that they intend to remain in Florida, and have been renting their New York property
to a tenant since moving. Under the circumstances of this case, where the plaintiffs are
proceeding pro se, we are satisfied that these allegations are sufficient to demonstrate “both
physical presence [in Florida] and intent to stay.” See Universal Reinsurance Co., 224 F.3d at
141. We therefore hereby deem the Maitlands’ pleadings amended to properly allege diversity
jurisdiction, see Canedy, 126 F.3d at 103, and we remand the case for the district court to address
the Maitlands’ state law claims in the first instance, see, e.g., Farricielli v. Holbrook, 215 F.3d
4
241, 246 (2d Cir. 2000) (per curiam) (observing that “[i]t is [this Court’s] settled practice to allow
the district court to address arguments in the first instance”).2
Accordingly, we AFFIRM the judgment of the district court with respect to the Maitlands’
federal claims, we VACATE the judgment of the district court with respect to their state law
claims, and we REMAND for further proceedings consistent with this opinion.
FOR THE COURT:
Catherine O’Hagan Wolfe, Clerk of Court
2
None of the appellees dispute that they are not citizens of Florida. However, it appears that
Chase, a national banking association, is actually a citizen of Ohio, not New York. See OneWest
Bank, N.A. v. Melina, 827 F.3d 214, 219 (2d Cir. 2016) (per curiam) (national banking association
is citizen of state listed in its articles of association as its main office); Arthur v. JP Morgan Chase
Bank, NA, 569 F. App’x 669, 673 (11th Cir. 2014) (Chase’s principal office is in Ohio); Excelsior
Funds, Inc. v. JP Morgan Chase Bank, N.A., 470 F. Supp. 2d 312, 313–14, 314 n.3 (S.D.N.Y.
2006) (same). Regardless, this fact would not defeat complete diversity.
5