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Quality Labels & Packaging, Inc. v. Wells Fargo Bank, N.A.

United States District Court, M.D. North Carolina

July 9, 2019

QUALITY LABELS & PACKAGING, INC. and DISTRIBUIDORA DE EMPAQUES CENTROAMERICANO, S.A., Plaintiffs,
v.
WELLS FARGO BANK, N.A., DREW'S LOUNGE, LLC, ANDREW I. ROBERTSON, and JOHN DOES 1-5, Defendants.

          MEMORANDUM OPINION AND ORDER

          OSTEEN, JR., DISTRICT JUDGE

         Now before the court are Defendants' motion to dismiss, (Doc. 5), Plaintiffs' first amended complaint and Plaintiffs' motion to remand, (Doc. 8). As explained herein, this court finds that the motion to dismiss should be denied as moot because Plaintiffs have filed a second amended complaint. This court further finds that the motion to remand should be denied.

         I. BACKGROUND & PROCEDURAL HISTORY

         Plaintiff Quality Labels & Packaging, Inc., is “in the business of printing labels for use in textile products.” (Second Amended Complaint (“Second Am. Compl.”) (Doc. 6) ¶ 9.) Defendant Wells Fargo Bank, N.A. (“Wells Fargo”) is “a national banking institution.” (Id. ¶ 3.) Defendant Drew's Lounge, LLC (“Drew's Lounge”) is a corporation, owned by Defendant Andrew I. (“Robertson”), that allegedly “opened a Business Choice Checking Account . . . at Wells Fargo . . . [that] was used to receive stolen funds illegally and fraudulently obtained from Plaintiffs.” (Id. ¶¶ 4-5, 14.) Plaintiffs also identify as defendants five unknown individuals, John Does 1-5, who allegedly assisted in this conspiracy.

         Generally, Plaintiffs allege that Defendant Robertson (through Drew's Lounge) created fake email addresses, duped Plaintiffs into thinking they were dealing with a real supplier of label material, and induced Plaintiffs to transfer thousands of dollars into the Wells Fargo accounts. (Id. ¶¶ 15-20.) Plaintiffs bring the following claims: (1) negligence and violation of UCC Article 4A against Wells Fargo, alleging that the bank failed to follow know-your-customer processes and verify account ownership; (2) conversion against all Defendants; (3) false pretenses against Drew's Lounge, Robertson and John Does 1-5; (4) tortious interference with contracts against Drew's Lounge, Robertson and John Does 1-5; and (5) unfair and deceptive trade practices against all Defendants. (Id. ¶¶ 21-56; Amended Complaint (“First Am. Compl.”) (Doc. 2) ¶¶ 21-56.)

         Plaintiffs initially filed this lawsuit in Forsyth County Superior Court. The case was then removed by Defendants, who assert that this court has jurisdiction pursuant to 28 U.S.C. § 1332 because the parties are completely diverse and the amount in controversy alleged on the face of the first amended complaint is greater than $75, 000.00. (Doc. 1 ¶¶ 10-12.) Defendants then filed a motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6). (See Doc. 5.)

         Two days after the motion to dismiss was filed, Plaintiffs filed a second amended complaint. (See Second Am. Compl. (Doc. 6).) Plaintiffs then moved to remand the case to state court, (Doc. 8), and submitted a brief in support of that motion, (Pls.' Br. in Supp. of Mot. to Remand (“Pls.' Br.”) (Doc. 9).) Defendants responded opposing the motion to remand, (Doc. 14), and Plaintiffs replied, (Doc. 16).

         II. MOTION TO DISMISS

         Because this court ultimately determines that the motion to dismiss should be denied as moot without reaching the merits, this court will not set forth the substantive motion to dismiss standard here.

         Plaintiffs filed a second amended complaint as a matter of course under Fed.R.Civ.P. 15(a)(1)(B). (See Second Am. Compl. (Doc. 6).) Because the subsequent complaint automatically supersedes the first amended complaint, rendering it null and void, this court finds that Defendants' motion to dismiss the first amended complaint should be denied as moot. See, e.g., Shoe Show, Inc. v. One-Gateway Assocs., LLC, No. 1:14CV434, 2015 WL 1128016, at *2 (M.D. N.C. Mar. 12, 2015) (“Defendant's Motion to Dismiss Plaintiff's Original Complaint will be denied as moot because the Original Complaint is superseded by Plaintiff's Amended Complaint.”) (internal quotation marks omitted); Baucom v. Cabarrus Eye Ctr., P.A., No. 1:06CV00209, 2006 WL 2569079, at *1 (M.D. N.C. Sept. 1, 2006) (“Defendant's motion to dismiss seeks dismissal of a superceded complaint, and the court must regard the motion as moot.”).

         III. MOTION TO REMAND

         A. Legal Standard

         28 U.S.C. § 1441 allows a defendant to remove “any civil action brought in a State court of which the district courts of the United States have original jurisdiction” to federal court.

[A] party seeking to adjudicate a matter in federal court must allege and, when challenged, must demonstrate the federal court's jurisdiction over the matter. If a plaintiff files suit in state court and the defendant seeks to adjudicate the matter in federal court through removal, it is the defendant who carries the burden of alleging in his notice ...

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