Moody v. PennyMac Loan Services, LLC

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
Dana E. Moody
v. Civil No. 16-cv-21-JL
PennyMac Loan Services, LLC
REPORT AND RECOMMENDATION
In a case that has been removed from state court, Dana E.
Moody, proceeding pro se, brings this action against PennyMac
Loan Services, LLC (“PennyMac”) alleging violations of the Real
Estate Settlement Procedure Act (“RESPA”), 12 U.S.C. § 2601 et
seq. Before the court for a report and recommendation are
Moody’s motions to remand (doc. nos. 10, 19, 23, & 27) and for
default judgment (doc. nos. 11, 20, 24, & 28). For the reasons
stated below, the court recommends that the motions be denied.
Background1
Moody previously owned a home in New Boston, New Hampshire.
Compl. ¶ 1, doc. no. 30.2 In 2010, PennyMac began to service
Moody’s mortgage loan. Id. ¶ 2; Compl. Ex. C, doc. no. 30-3.
1 A more detailed background can be found in the court’s June 6,
2016 report and recommendation. Doc. no. 37.
2 The complaint referenced is Moody’s amended consolidated
complaint submitted on April 6, 2016. Doc. no. 30.
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In July 2014, Moody’s home was foreclosed and sold at auction.
Compl. ¶ 3; Compl. Ex. C.
The next year, in April 2015, Moody sent a letter to
PennyMac requesting five categories of documents. Compl. Ex. A.
The next month, PennyMac acknowledged receipt of Moody’s April
2015 letter and soon after responded, in part, to Moody’s
requests. Compl. Ex. B; Compl. Ex. C.
In August 2015, Moody sent another letter to PennyMac.
Compl. ¶ 14; Compl. Ex. D. Moody’s August 2015 letter requested
eight additional categories of documents. Compl. Ex. D.
PennyMac acknowledged receipt of Moody’s August 2015 letter but
never responded to Moody’s document requests. Compl. ¶¶ 15-16;
Compl. Ex. E.
In September 2015, Moody sent another letter, this time
addressed to PennyMac’s foreclosure counsel in Rhode Island.
Compl. Ex. F. Neither PennyMac nor its foreclosure counsel
responded to Moody’s September 2015 letter. Compl. ¶ 19.
In October 2015, Moody sent a third letter to PennyMac and
his fourth letter since April requesting certain documents.
Compl. ¶ 20; Compl. Ex. G. The October 2015 letter requested
documents initially requested in Moody’s earlier letter to
PennyMac’s foreclosure counsel and five additional categories of
documents. Compl. ¶¶ 20-21. PennyMac acknowledged receipt of
Moody’s October 2015 letter but, again, did not respond to
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Moody’s document requests. Compl. ¶ 22-23; Compl. Ex. H. This
suit followed.
Discussion
A month after PennyMac removed Moody’s four actions to this
court, Moody filed a motion to remand as well as a motion for
default judgment.3 Moody’s motion to remand alleges that he
filed his complaints in state court against PennyMac on December
21, 2015. Doc. no. 10 ¶ 1. According to Moody, the state court
sent PennyMac a copy of the complaint and permitted it until
January 22, 2016 to file a response. Id. ¶¶ 2-3. On the day
before the response deadline, PennyMac filed its notice of
removal in this court. Id. ¶ 5; doc. no. 1. Moody alleges that
PennyMac, however, failed to notify the state court of its
removal until after the allotted response deadline in state
court. Id. ¶¶ 8-9.
Moody contends that because PennyMac served a copy of its
notice to the state court after the response deadline, PennyMac
has defaulted and removal to this court was improper. See doc.
3 This case was consolidated from four actions to one. See
Dockets 16-cv-00022-PB, 16-cv-00024-LM, & 16-cv-00025-JL.
Before consolidation, Moody filed a motion to remand and a
motion for default judgment in each action. Doc. nos. 10, 11,
19, 20, 23, 24, 27 & 28. Although eight separate motions appear
on the docket, the motions are nearly identical and are viewed
by the court as one motion to remand and one motion for default
judgment.
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nos. 10, 11. PennyMac objects, arguing that removal was proper
and default cannot be entered in this court. The court agrees.
Under 28 U.S.C. § 1446, “[a] defendant may remove a civil
case from state to federal court only if the federal court has
‘original jurisdiction’ over the action . . . .” Universal
Truck & Equip. Co., Inc. v. Caterpillar, Inc., No. 15-1609, 2016
WL 3509541, at *3 (1st Cir. June 27, 2016). A defendant,
though, must file its notice of removal within thirty days of
service. 28 U.S.C. § 1446(b). In addition, after filing a
notice of removal, a defendant must “[p]romptly . . . file a
copy of the notice with the” state court. § 1446(d).
Here, PennyMac filed its notice of removal on January 21,
and the state court received a paper copy the next day. Doc. 10
¶ 8. Moody alleges that the state court rejected the copy
(because the court does not accept paper copies) and requested
that the notice be filed electronically. Id. ¶ 9. PennyMac did
so three days later. Doc. no. 42-1. Therefore, at the latest,
PennyMac filed a copy of its notice of removal with the state
court four days after filing in this court.4
Importantly, Moody does not appear to argue that this court
does not have original jurisdiction or that PennyMac improperly
4 In addition, pursuant to Federal Rule of Civil Procedure
81(c)(2)(C), PennyMac filed its original motion to dismiss in
lieu of an answer within seven days after the notice of removal.
Doc. no. 6.
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filed its notice of removal, but rather it failed to promptly
file a copy with the state court. Yet, the plaintiff does not
allege any prejudice from the four-day delay between filings,
and no significant action has been taken by the state court
since PennyMac filed its notice of removal. See doc. no. 42-1.
Thus, under these circumstances, a four-day delay between filing
a notice of removal and providing a copy to the state court is
sufficiently “prompt,” and the court should not remand this
action back to the state court. See Ynoa v. Kutner, No. 10–
5398, 2011 WL 1796320, at *2–3 (S.D.N.Y. May 5, 2011) (denying
remand and noting that the court was not aware of any action
taken by the state court during the delay and plaintiff did not
claim that she suffered any prejudice due to the sixty-seven day
delay).
Moreover, even if PennyMac had defaulted in state court,5
this court maintains jurisdiction. See Berberian v. Gibney, 514
F.2d 790, 792–93 (1st Cir. 1975) (“[J]urisdiction of the federal
court attaches as soon as the petition for removal is filed with
it, and that both state and federal courts have jurisdiction
until the process of removal is completed”); Sindi v. El-
Moslimany, No. CIV.A. 13-10798-GAO, 2014 WL 1281522, at *2 (D.
5 In its supplementary briefing, PennyMac attached a copy of the
state court’s electronic docket showing that default had not
been entered by the state court. See doc. no. 42-1.
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Mass. Mar. 26, 2014) (“Because this Court and the state court
had concurrent jurisdiction, ‘the default was effective, but did
not defeat the jurisdiction of the federal court which had
already attached. The effect of the default was the same as if
it had been entered by [this] court upon failure of [the
defendants] to answer a complaint originally filed there.’”)
(quoting Berberian, 514 F.2d at 792).
Lastly, Moody’s motions for default judgment should also be
denied. Obtaining a default judgment under Federal Rule of
Civil Procedure 55 “is a two[-]step process that requires the
entry of a default by the clerk prior to the entry of a default
judgment.” Allied Home Mortgage Capital v. Belli, No. CIV.A.
12-10158-GAO, 2012 WL 3059423, at *7 (D. Mass. July 25, 2012);
see also 10A Charles Alan Wright, Arthur R. Miller & Mary Kay
Kane, Federal Practice & Procedure § 2682 (3d ed. 1998) (“Prior
to obtaining a default judgment under either Rule 55(b)(1) or
Rule 55(b)(2), there must be an entry of default as provided by
Rule 55(a)”). These two steps cannot be consolidated. See
e.g., VonGrabe v. Sprint PCS, 312 F. Supp. 2d 1313, 1318 (S.D.
Cal. 2004). Thus, without an entry of default by the clerk,
Moody may not seek default judgment against PennyMac.
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Conclusion
For the foregoing reasons, the court recommends that
Moody’s motions to remand (doc. nos. 10, 19, 23, & 27) and for
default judgment (doc. nos. 11, 20, 24, & 28) be denied. Any
objections to this report and recommendation must be filed
within fourteen days of receipt of this notice. See Fed. R.
Civ. P. 72(b)(2). Failure to file objections within the
specified time waives the right to appeal the district court’s
order. See United States v. De Jesús-Viera, 655 F.3d 52, 57 (1st
Cir. 2011); Sch. Union No. 37 v. United Nat’l Ins. Co., 617 F.3d
554, 564 (1st Cir. 2010).
SO ORDERED.
__________________________
Andrea K. Johnstone
United States Magistrate Judge
August 30, 2016
cc: Dana E. Moody, Pro Se
Kevin P. Polansky, Esq.
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