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Mixon v. Nationstar Mortgage, LLC

United States District Court, S.D. Alabama, Southern Division

December 2, 2014

TIMOTHY M. MIXON, et al., Plaintiffs,
v.
NATIONSTAR MORTGAGE, LLC, Defendant

For Timothy M. Mixon, Lisa N. Mixon, Plaintiffs: Michael Jay Tonder, LEAD ATTORNEY, Law Office of Michael Tonder, P.C., Mobile, AL; J. Milton Coxwell, Jr., Monroeville, AL.

For Nationstar Mortgage, LLC, Defendant: Gregory C. Cook, LEAD ATTORNEY, Balch & Bingham, Birmingham, AL; Griffin Lane Knight, LEAD ATTORNEY, Balch & Bingham, Montgomery, AL; John Wesley Naramore, Balch & Bingham LLP, Montgomery, AL.

Page 1322

ORDER

WILLIAM H. STEELE, CHIEF UNITED STATES DISTRICT JUDGE.

This matter is before the Court on the plaintiffs' motion to remand. (Doc. 6). The defendant has filed a response and the plaintiffs a reply, (Docs. 12, 13), and the motion is ripe for resolution.[1] After careful consideration, the Court concludes the motion to remand is due to be granted.

BACKGROUND

The plaintiffs filed suit in state court alleging that the defendant, as the assignee of their mortgage, has refused to accept bi-monthly mortgage payments even though the mortgage specifically provides for them. Based on its improper refusal to accept their payments, the defendant has declared the plaintiffs to be in default and the mortgage subject to foreclosure. The plaintiffs deny they are in default or that the defendant has a lawful right to foreclose, and they ask the court both to make a declaration to that effect and to enjoin the defendant from attempting to foreclose. (Doc. 1-1).

The defendant removed on the basis of diversity. The issue is whether the defendant has met its burden of showing that the amount in controversy exceeds the jurisdictional threshold.

Page 1323

DISCUSSION

" [T]he party seeking to invoke federal jurisdiction bears the burden of proving by a preponderance of the evidence that the claim on which it is basing jurisdiction meets the jurisdictional minimum." Federated Mutual Insurance Co. v. McKinnon Motors, LLC, 329 F.3d 805, 807 (11th Cir. 2003). " [A] removing defendant must prove by a preponderance of the evidence that the amount in controversy more likely than not exceeds the ... jurisdictional requirement." Roe v. Michelin North America, Inc., 613 F.3d 1058, 1061 (11th Cir. 2010) (internal quotes omitted). " A court's analysis of the amount-in-controversy requirement focuses on how much is in controversy at the time of removal, not later." Pretka v. Kolter City Plaza II, Inc., 608 F.3d 744, 751 (11th Cir. 2010).

" When a plaintiff seeks injunctive or declaratory relief, the amount in controversy is the monetary value of the object of the litigation from the plaintiff's perspective." Cohen v. Office Depot, Inc., 204 F.3d 1069, 1077 (11th Cir. 2000). " In other words, the value of the requested injunctive relief is the monetary value of the benefit that would flow to the plaintiff if the injunction were granted," id., or, conversely, " the losses that will follow from" not obtaining the injunction. Hunt v. Washington State Apple Advertising Commission, 432 U.S. 333, 347, 97 S.Ct. 2434, 53 L.Ed.2d 383 (1977).

The threshold question is how to evaluate the amount in controversy when the plaintiff seeks to enjoin foreclosure. This is not a novel issue, but courts have resolved it in a variety of ways.

Other federal courts in Alabama ... have taken one of four approaches to establish the amount in controversy in claims involving wrongful foreclosures: either (1) the value of the property; (2) the amount of the mortgage (i.e., the balance due on the promissory note secured by the mortgage); (3) the value of a temporary delay of a foreclosure; or (4) a plaintiff's equity in the real estate subject to foreclosure.

Mapp v. Deutsche Bank National Trust Co., 2009 WL 3664118 at *1 (M.D. Ala. 2009) (" Mapp II " ). The Court has addressed the issue three times, but its resolutions were driven by the unusual facts of those cases.

In Carstarphen v. Deutsche Bank National Trust Co., 2009 WL 1035490 (S.D. Ala. 2009) (" Castarphen I " ), the Court determined that the monetary value to the plaintiff of an injunction against foreclosure was " the full value of her home." Id. at *6. This conclusion was based on the allegations of the complaint, which asserted that the removing defendant had no standing to foreclose and that the plaintiff's mortgage payments were actually payable to a third party, such that the plaintiff could still be required to make payments to the third party even after foreclosure. In such a situation, the plaintiff would lose her home without any offsetting benefit of reduced or eliminated debt, so the value to her of obtaining the injunction was the full value of her home. Id. & n.11.

On motion to reconsider, the plaintiff pointed out that she did not seek a permanent injunction but sought only to prevent foreclosure " until such time as the bona fides of the plaintiff's complaint can be heard before the Court after the taking of evidence" or " until such time as the material averments of the Plaintiff's complaint have been heard." Carstarphen v. Deutsche Bank National Trust Co., 2009 WL 1537861 at *4 (S.D. Ala. 2009) (" Castarphen II " ). The Court concluded that the monetary value of the ...


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