United States District Court, D. New Jersey
Matthew S. Wolf, Esq., Melissa A. Schroeder, Esq. Matthew S. Wolf, ESQ., LLC, Cherry Hill, New Jersey, Counsel for Plaintiff.
William M. Tambussi, Esq., Susan M. Leming, Esq., Michael J. Miles, Esq., BROWN & CONNERY LLP, Westmont, New Jersey and Seth M. Kean, Esq., REED SMITH LLP, New York, New York, Counsel for Defendant TD Bank, N.A.
THOMAS J. GOSSE, ESQ. Haddon Heights, New Jersey, Counsel for Defendant Moser.
JOSEPH E. IRENAS, Senior District Judge.
Plaintiffs, Oleg and Angela Shtutman, husband and wife, bring this state law negligence suit against Defendants TD Bank, N.A., and its "senior manager, " Marissa Moser, asserting that Defendants' negligence caused Plaintiffs to lose approximately $1.5 million in a Ponzi scheme.
Defendants timely removed the suit to this Court. Plaintiffs move to remand the case, asserting that this Court lacks subject matter jurisdiction pursuant to 28 U.S.C. § 1331. For the reasons stated herein, the Court holds that the negligence claims do not "arise under" the Constitution, laws, or treaties of the United States, as that term is used in the federal question jurisdictional statute. Accordingly, the Motion to Remand will be granted.
In July, 2013, Everett Miller, the principal of Carr Miller Capital, LLC, pled guilty in this District to securities fraud and tax evasion. The charges allegedly arise out of a "Ponzi scheme" Miller operated through Carr Miller Capital. Prior to Miller's plea, in 2011, Carr Miller Capital was placed in receivership by the Attorney General of New Jersey.
Plaintiffs invested approximately $1.5 million in the Carr Miller Capital enterprise. "Investments were achieved by opening a joint account between Oleg Shtutman and Carr Miller, which TD Bank knew was completely unsound, inappropriate and criminally suspicious manner of opening an account." (Compl. ¶ 12) Miller admitted in his plea colloquy that "investors' money was commingled and pooled into one of Carr Miller's seventy-five related bank accounts, " at TD Bank and that money was used for purposes other than Carr Miller ventures. (Id. ¶ 14)
The Complaint alleges that over the course of several years, TD Bank deliberately or negligently ignored suspicious transactions involving Carr Miller Capital's TD Bank accounts, and did so because its senior manager, Defendant Marissa Moser, was at one point in time Carr Miller Capital's "Comptroller/Office Manager." (Compl. ¶ 19) According to the Complaint, "TD Bank had actual knowledge that client funds were being funneled through the TD Bank Carr Miller accounts but based on the special relationship that Carr Miller had with TD Bank by virtue of [Marissa Moser], TD Bank did not take actions that it should have taken." (Id. ¶ 25)
Specifically, the Complaint alleges that TD Bank should have filed with federal law enforcement and the Department of Treasury "Suspicious Activity Reports" ("SARs") as required by federal regulations 12 C.F.R. 21.11(c)(4) and 31 C.F.R. 103.18(a)(2), and the Bank Secrecy Act, 31 U.S.C. §§ 5318(g) and (h)(1); and failed to properly train its employees concerning these obligations under federal law. The Complaint further states, "[a]s a direct and proximate result of TD Bank's negligence in failing to train its employees..., failing to issue SARs properly, failing to follow the guidance of the Bank Secrecy Act / Anti-Money Laundering Examination Manual of 2007... and TD Bank's willful indifference resulting from its special treatment of Carr Miller based on Marissa Moser's employment between the two companies, Plaintiffs Oleg and Angela Shtutman suffered approximately $1.5 million in damages." (Compl. ¶ 35)
The Complaint asserts two counts: a negligence claim against TD Bank and a negligence claim against Marissa Moser.
28 U.S.C. § 1447(c) provides in relevant part, "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded." Removing defendants bear the burden of establishing subject matter jurisdiction. ...