Scotiabank De P.R. v. Halais-Borges

Citation: 350 F. Supp. 3d 39Docket: Civil No. 18-1350 (FAB)

Court: United States District Court; December 10, 2018; Federal District Court

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The Court has remanded the case, originally filed as K CD 2012-1782 in the Puerto Rico Court of First Instance, back to that court. In this action, Scotiabank de Puerto Rico (the plaintiff) sought an order for defendant Eric Santiago Halais-Borges to pay attorneys' fees under 28 U.S.C. § 1447(c) following a notice of removal filed by Halais, which invoked federal question jurisdiction but was deemed inappropriate. The Court determined that the defenses raised by Halais under federal statutes were insufficient to establish jurisdiction, citing that similar situations have previously led to remands in similar cases focused on Puerto Rico law.

Scotiabank's request for attorneys' fees was granted, based on the provision in § 1447 that allows for recovery of costs and expenses incurred due to removal. The Supreme Court has indicated that such removals can delay case resolutions and waste judicial resources. The awarding of fees is at the district court's discretion, with the standard being the reasonableness of the removal. Generally, fees may be awarded if the removing party lacked an objectively reasonable basis for seeking federal jurisdiction, without needing to prove bad faith.

Scotiabank contends that the removal of the case to this Court lacked an objectively reasonable basis, arguing for an award of attorneys' fees due to the absence of any federal claim in the notice of removal. The Court agrees, citing that actions based solely on state law cannot invoke federal subject matter jurisdiction through federal defenses. It references multiple precedents confirming that a federal defense does not suffice for removal jurisdiction and that the federal statutes cited in Scotiabank's defense do not establish subject matter jurisdiction. The Court deems that Halais, the defendant, lacked a reasonable basis for removal, which unnecessarily prolonged the case, consumed judicial resources, and inflated litigation costs. 

Halais opposes the attorneys' fees request by arguing that the case involved unsettled legal principles and that Scotiabank's claims are preempted by federal law, referencing case law that supports removal in cases of complete preemption. However, the Court finds Halais' arguments unpersuasive, noting that the claims do not present novel legal questions and that mere references to federal statutes do not indicate preemption applicability. Ultimately, Scotiabank seeks attorneys' fees in the amount of $1,762.50.

Ramón Luis Nieves, counsel for Scotiabank, submitted a sworn affidavit detailing the legal services rendered, specifically noting 13.75 hours of work at $100 per hour for himself and 7.75 hours at $50 per hour for his paralegal. The Court referenced the case Andrade v. Jamestown Housing Authority to establish that it can determine reasonable attorney fees based on its knowledge of prevailing rates in the local market. The Court concluded that $1,762.50 is a reasonable fee for the services provided. Consequently, Scotiabank's motion for attorneys' fees was granted, ordering Halais to pay this amount due to the removal and remand of the case. Additionally, Halais has alleged multiple violations by Scotiabank under various federal statutes, including the Truth in Lending Act and the Fair Debt Collection Practices Act.