LARRY L. COX and RENEE M. COX v. United States Department of Agriculture

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
LARRY L. COX and RENEE M. COX,
Plaintiffs - Appellees,
v.
UNITED STATES DEPARTMENT OF
AGRICULTURE,
Defendant - Appellant.
No. 13-15225
D.C. No. 3:11-cv-00454-RCJ-
WGC
MEMORANDUM*
Appeal from the United States District Court
for the District of Nevada
Robert Clive Jones, District Judge, Presiding
Submitted July 6, 2015**
San Francisco, California
Before: TALLMAN, M. SMITH, and MURGUIA, Circuit Judges.
Plaintiffs-Appellees Larry and Renee Cox defaulted on a rural housing loan
granted by Defendant-Appellee U.S. Department of Agriculture (“USDA”). When
USDA initiated foreclosure proceedings, the Coxes elected to participate in
FILED
JUL 13 2015
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
* This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
** The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).

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Nevada’s Foreclosure Mediation Program. The mediator found that USDA did not
participate in mediation in good faith, chiefly because USDA regulations prevented
the agency from entertaining the loan modifications that the Coxes requested. The
Coxes petitioned in state court for an order modifying their loan.
USDA removed the petition to the District of Nevada under 28 U.S.C.
§ 1442(a)(1) and moved to dismiss pursuant to sovereign immunity and other
doctrines. The district court held that it lacked subject matter jurisdiction and
remanded to state court. USDA now appeals, arguing that remand was improper
because USDA enjoys sovereign immunity from suit in Nevada state courts. We
have jurisdiction under 28 U.S.C. § 1291, and reverse the district court’s order
remanding the petition to state court.
Because the record contains no evidence that USDA waived its sovereign
immunity to the Coxes’ petition, the Nevada state court lacked jurisdiction over the
action. See Neb. ex rel. Dep’t of Soc. Servs. v. Bentson, 146 F.3d 676, 679–80 (9th
Cir. 1998). Accordingly, under the derivative jurisdiction doctrine, the district
court also lacks jurisdiction over the petition on removal. See In re Elko Cnty.
Grand Jury, 109 F.3d 554, 555 (9th Cir. 1997). The district court therefore was
bound to dismiss the petition rather than remand to state court. See id.
Because we conclude that the district court erred in failing to dismiss the
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petition for lack of jurisdiction, we do not reach the other issues raised on appeal.
The district court’s remand order is REVERSED and the action
REMANDED with instructions that the district court dismiss the Coxes’ petition
for lack of jurisdiction.
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