ONA T. WANG, Magistrate Judge.
Before the Court is a dispute whether the Court has proper removal jurisdiction over this case. Although Plaintiffs did not file a motion to remand, the Court can sua sponte terminate a case whenever a lack of subject-matter jurisdiction is found. See Bernstein v. Universal Pictures, Inc., 517 F.2d 976, 979 (2d Cir. 1975). Because the face of Plaintiffs' complaint only lists a fraud cause of action, on October 24, 2018, the Court directed the parties to brief whether this Court has subject-matter jurisdiction. (ECF 7). For the reasons listed below, the Court concludes that subject-matter jurisdiction does not exist here and that the case was improperly removed.
Plaintiffs, owners of a flower business, were initially sued by their former employee, Defendant Luna Saavedra ("Ms. Saavedra"), in a separate federal lawsuit for failure to provide overtime compensation. See Saavedra v. Mrs. Bloom's Direct, Inc., Case No. 17-CV-2180 (OTW) (S.D.N.Y. Mar. 26, 2017). Plaintiff attempted to introduce evidence of Ms. Saavedra's immigration status at trial, but my predecessor, the Honorable Andrew J. Peck, granted the motion in limine to preclude such evidence. (ECF 1-1 ¶ 9). During the bench trial, the parties reached a settlement, with the agreement and Judge Peck's Cheeks
The Court entered judgment against Plaintiffs in the amount of $25,000 plus postjudgment interest on May 25, 2018. (ECF 70). Approximately a month later, Plaintiffs then brought this action in New York Supreme Court, Westchester County against Ms. Saavedra for allegedly making fraudulent misrepresentations about her immigration status in order to be hired by Plaintiffs. (ECF 25 ¶¶ 22-23). Plaintiffs specifically alleged that before she was hired, Ms. Saavedra falsely stated that she was a legal permanent resident and that she had a valid Social Security number. (ECF 1-1 ¶¶ 4-5). As a result, Plaintiffs allege, they have been placed at risk of being prosecuted for violation of federal law for hiring an undocumented worker. Id. ¶ 12. Ms. Saavedra removed the action to this Court on September 4, 2018, asserting federal question jurisdiction. (ECF 1). In the notice of removal, Ms. Saavedra acknowledges that only a state fraud claim is alleged, but argues that the action is a "frivolous Rule 60 motion couched in state law" that attempts to attack the previous federal court settlement and judgment. Id. ¶¶ 1, 7.
Ms. Saavedra removed the state court action to this Court based on federal question jurisdiction under 28 U.S.C. §1331. (ECF 1 ¶ 2). Ms. Saavedra argues that although the state court action was labeled a fraud claim, the allegations show that the complaint was actually "an improper collateral attack on a federal court judgment." Id. ¶ 7. In response, Plaintiffs argue that their complaint is indeed a true fraud claim that does not require federal law to resolve. See Saavedra, No. 17-cv-2180, ECF 90 at 11.
The removing party must demonstrate original subject-matter jurisdiction on the face of the pleading. See Jefferson County v. Acker, 527 U.S. 423, 431 (1999) (noting that without a basis for federal jurisdiction in the complaint, "an anticipated or actual federal defense generally does not qualify a case for removal"). Here, Ms. Saavedra cites federal question jurisdiction, which encompasses "all civil actions arising under the Constitution, laws, or treaties of the United States." See 28 U.S.C. § 1331. Specifically, Ms. Saavedra asserts that Plaintiffs' suit is "predicated upon the validity of a federal judgment, federal law and the conduct within a prior federal action." (ECF 1 ¶ 2). Federal jurisdiction does not lie, however, merely to protect a federal court order or to protect a federal court settlement agreement. See Syngenta Crop Protection, Inc. v. Henson, 537 U.S. 28, 33-34 (2002); see also Young-Smith v. Holt, 575 F. App'x 680, 681 (7th Cir. 2014) ("fraud-on-the-court claims do not independently supply another federal court with federal-question jurisdiction if a federal law has not been violated").
Plaintiffs' complaint alleges that Ms. Saavedra made fraudulent misrepresentations concerning her legal status when they initially hired her. (ECF 2-1 ¶¶ 4-7). Although Plaintiffs reference the initial federal court judgment, they do so only to demonstrate injury, not to support their claim of fraud.
The case cited by Ms. Saavedra, Black v. Niagara Mohawk Power Corp., 641 F.Supp. 799 (N.D.N.Y. 1986), is distinguishable because there, the plaintiff was "attacking the validity of a federal judgment," for which relief can only be provided under federal law. Black, 641 F.Supp. 799 at 802 n. 3. In contrast, Plaintiffs' claim is more akin to the one in Cresswell because Plaintiffs are not disputing the settlement agreement's validity but are arguing Ms. Saavedra's fraudulent misrepresentations caused damages.
Without original subject-matter jurisdiction, this case was improperly removed. Accordingly, the matter is hereby REMANDED to the New York Supreme Court, County of Westchester.