Mederer v. Access Capital Investment Fund Two, LP

Background

Matthias Richard Mederer sued Access Capital Investment Fund Two, LP, SN Servicing Corporation, Prestige Default Services, LLC, U.S. Bank Trust National Association as trustee for Chalet Series III Trust and Lodge Series III Trust, Wells Fargo Bank, Steven Wang, Michelle Ghidotti, and William A. Fogleman. He alleged that Wells Fargo’s predecessor, World Savings Bank, misrepresented the terms of a loan and induced him to sign documents he did not understand. He alleged that the loan terms led to default and foreclosure.

Mederer filed an application to proceed in forma pauperis, meaning without paying the filing fee because he could not afford it, and later filed a First Amended Complaint. The court ordered him either to provide additional financial information or to pay the $402 filing fee by January 24, 2022. He submitted two Bank of America account statements showing an aggregate balance of $100.01 in December 2021, but he did not declare that those were his only accounts. He did not submit the required amended application or supplemental declaration and did not pay the filing fee.

Analysis

The court concluded that Mederer had not established that he qualified to proceed without paying the filing fee. Under 28 U.S.C. § 1915, an applicant must provide an affidavit listing all assets and showing an inability to pay. The court found that the incomplete financial information independently supported dismissal.

The court also reviewed the complaint under the statute requiring screening of complaints filed by people proceeding without paying filing fees. It explained that complaints must contain enough factual matter to state a plausible claim for relief and that courts generally give self-represented litigants’ complaints a liberal reading.

The court separately determined that Mederer had not established subject-matter jurisdiction, meaning the court’s legal authority to hear the case. It found that his reference to the federal Truth in Lending Act did not establish federal-question jurisdiction because his seventh claim primarily relied on California’s Unfair Competition Law and California Business and Professions Code. The court also found that he had not alleged complete diversity or affirmatively alleged every party’s citizenship. The complaint stated that Mederer resided in California and that several defendants were also located in California.

Disposition

The court directed the Clerk of Court to reassign the case to a district judge because Wells Fargo Bank had not consented to the magistrate judge’s jurisdiction. Magistrate Judge Laurel Beeler recommended dismissal for two independent reasons: Mederer failed to establish that he was entitled to proceed without paying the filing fee, and he failed to establish subject-matter jurisdiction. The recommendation was not itself a final dismissal in the opinion. Parties could file specific written objections within 14 days after being served, and the opinion stated that failing to object could waive the right to appeal the district court’s order.