Freunscht v. BankNorth, NA

2004 DNH 051

• Court: District Court, D. New Hampshire
• Decided: March 17, 2004
• Docket: CV-04-024-JD
• Status: Published

Opinion

Freunscht v. BankNorth, NA CV-04-024-JD 03/17/04 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Catherine Freunscht

v. Civil No. 04-024-JD Opinion No. 2004 DNH 051 BankNorth. NA

O R D E R

The plaintiff brought a class action suit in state court,

seeking a declaratory judgment and statutory damages pursuant

to New Hampshire Revised Statutes Annotated ("RSA") § 361-A.

The defendant removed the action to this court asserting that

the plaintiff's claims were preempted by federal law. The

plaintiff moves to remand the case for lack of subject matter

jurisdiction.

An action brought in state court may be removed to an

appropriate federal district court, if the federal court has

original subject matter jurisdiction. 28 U.S.C. § 1441.

Subject matter jurisdiction is determined from the face of the

complaint filed in state court unless, in unusual cases, "a

claim, though couched in the language of state law, implicates

an area of federal law for which Congress intended a

particularly powerful preemptive sweep." Danca v. Private

Health Care Svs., Inc.. 185 F.3d 1, 4 (1st Cir. 1999). In

that narrow exception to the rule, the claim is "necessarily federal in character." Metro. Life Ins. Co. v. Tavlor. 481

U.S. 58, 63 (1987).

"Thus, a state claim may be removed to federal court in

only two circumstances--when Congress expressly so provides,

such as in the Price-Anderson Act, . . . or when a federal

statute wholly displaces the state-law cause of action through

complete pre-emption." Beneficial Nat'l Bank v. Anderson. 123

S. C t . 2058, 2063 (2003) . To date, the Supreme Court has

found complete preemption only in causes of action under the

Labor Management Relations Act, the Employee Retirement Income

Security Act, possessory land claims by Indian tribes, and

usury claims under the National Bank Act. Id. at 2063-64.

The defendant bears the burden of showing subject matter

jurisdiction for removal based on complete preemeption.

Danca. 185 F.3d at 5.

In the case removed to this court, the plaintiff alleged

that when she and others in the proposed class bought cars,

the dealers arranged for financing which included up front

charges for insurance coverage on the loans.1 When they paid

’■Although the plaintiff has filed an amended complaint here, jurisdiction is determined from the complaint filed in state court. See Danca. 185 F.3d at 4. In any case, the contract claim added in the amended complaint provides no additional grounds for federal jurisdiction.

2 off the loans before the prepaid insurance coverage expired,

the plaintiff alleges, the defendant, holding the note on

their car financing loans, did not notify the credit insurer

that the loan was paid, as is required by state law. Due to

the lack of notice from the defendant, the credit insurers did

not refund the unearned premiums.

The plaintiff contends that the defendant's failure to

provide notice violated RSA 361-A:7, IV-a. She seeks a

declaratory judgment that the defendant's conduct violated RSA

361-A:7, IV-a, and an injunction to prevent future violations.

She also seeks an award of actual damages and a refund,

pursuant to RSA 361-A:11, III, of all finance charges paid to

the defendant.

In opposition to the plaintiff's motion to remand, the

defendant asserts that "[t]his Court's subject matter

jurisdiction over this case flows from the matrix of federal

statutes and regulations--including the National Bank Act, OCC

regulations, and the rights and remedies provided in the Truth

in Lending Act--and their preemption of RSA 361-A's notice

requirement as it applies to national banks." Opposition at

3. The defendant then provides background on the doctrine of

preemption, the history of the National Bank Act, and a long

and strained presentation on the interrelationship of certain

3 federal statutes and regulations. The defendant has not,

however, shown that Congress expressly provided for preemption

of state statutes like RSA 361-A:7 and :11 or that a federal

statute wholly displaces the cause of action alleged by the

plaintiff under RSA 361-A:7. See Beneficial. 123 S. Ct. at

2 0 63; see also Wilson v. Bank of Am. Corp.. 2004 WL 443881

(S.D. Miss. Feb. 20, 2004); JK & E P'ship v. Chase Manhattan

Bank. 2004 WL 97543 (E.D.N.Y. Jan. 16, 2004); McKenzie v.

Ocwen Fed. Bank FSB. 2004 WL 383374 (Jan. 9, 2004) .

Therefore, the defendant has not carried its burden of

showing that federal subject matter jurisdiction exists in

this case. In the absence of an adequate showing of subject

matter jurisdiction, the case is remanded to state court. The

defendant shall pay the plaintiff "just costs and any actual

expenses, including attorney fees, incurred as a result of the

removal." 28 U.S.C. § 1447(c).

Conclus ion

For the foregoing reasons, the plaintiff's motion to

remand (document no. 7) is granted. The plaintiff's motions

for class certification (document no. 12) and to stay

(document no. 13) are terminated without ruling due to a lack

of subject matter jurisdiction. The defendant shall pay the

4 plaintiff's costs and expenses pursuant to § 1447(c)

The clerk of court shall remand this case to the Superior

Court for the Northern District of Hillsborough County, New

Hampshire.

SO ORDERED.

Joseph A. DiClerico, Jr. United States District Judge

March 17, 2004

cc: David A. Anderson, Esquire Peter W. Culley, Esquire Edward K. O'Brien, Esquire