Lakeview Loan Servicing, LLC v. Tennyson

Summary

The United States District Court for the Northern District of Texas sua sponte dismissed the action without prejudice for lack of subject matter jurisdiction. The court held that 28 U.S.C. § 2410 waives sovereign immunity but does not independently confer federal jurisdiction over an action originally filed in federal court, and that the pleadings did not establish federal-question or diversity jurisdiction. The court denied the pending motions as moot and overruled the defendant’s objection as moot.

Holdings

1. Section 2410(a) waives the United States' sovereign immunity in qualifying foreclosure and lien actions but does not itself create a basis for federal subject matter jurisdiction in an action originally filed in federal court.
2. Grable did not overrule Hussain, and Grable's passing discussion of § 2410 was nonbinding dicta because the issue was not necessary to the decision.
3. Lakeview did not adequately plead a quiet-title cause of action against the United States because it alleged only conclusory statements concerning HUD's lien and requested that junior lienholders' interests be deemed inferior to Lakeview's interest.
4. The complaint did not establish federal-question jurisdiction because Lakeview pleaded a state-law breach-of-contract foreclosure claim that did not arise under federal law and did not necessarily turn on construction of federal law.
5. The complaint did not establish diversity jurisdiction because Lakeview did not allege diversity and its allegation concerning Tennyson's residency did not establish her citizenship or domicile.

Questions Presented

1. Whether 28 U.S.C. § 2410 independently created federal subject matter jurisdiction over Lakeview's original federal foreclosure action.
2. Whether Grable & Sons Metal Products, Inc. v. Darue Engineering & Manufacturing displaced or overruled the Fifth Circuit's holding in Hussain v. Boston Old Colony Insurance Co. that § 2410 waives sovereign immunity but does not itself create federal subject matter jurisdiction.
3. Whether Lakeview's complaint established federal-question jurisdiction under 28 U.S.C. § 1331.
4. Whether Lakeview's pleadings established diversity jurisdiction under 28 U.S.C. § 1332.

Disposition

dismissed