The opinion of the court was delivered by: Whaley, District Judge.
ORDER GRANTING PLAINTIFFS' MOTIONS TO REMAND
Before the Court are motions to remand brought by Plaintiffs in
each of the above-captioned cases: Ct. Rec. ___ in S.D. Cal. No.
00-CV-2524-RHW; Ct. Rec. ___ in S.D. Cal. No. 00-CV-2525-RHW; Ct.
Rec. ___ in S.D. Cal. No. 01-CV-387-RHW; Ct. Rec. ___ in N.D.
Cal. No. C-01-838-RHW; and Ct. Rec. ___ in N.D. Cal. No.
C-01-178-RHW. Oral argument was heard on these motions on June
27, 2001. Attorney appearances are noted in the official minutes.
For the reasons below, the motions are granted and these matters
are remanded to the state courts from which they were removed.
Plaintiffs in each case allege that Defendants engaged in
anticompetitive conduct while participating in California's
energy market, thereby artificially and illegally inflating the
wholesale and retail prices of electricity in that state.
Plaintiffs originally filed suit in state court, alleging that
Defendants' conduct violated California's Cartwright Act and
other sections of the California Business and Professions Code
prohibiting unfair or unlawful business practices. Various
Defendants then removed the actions to federal court in their
respective districts, arguing, inter alia, that the artful
pleading doctrine requires recasting of Plaintiffs' claims in
federal terms under the Federal Power Act. The cases were
subsequently transferred to this Court by the Judicial Panel on
Multidistrict Litigation. Plaintiffs now move to remand.
It is clear that Congress intended, in the Federal Power Act,
to vest in the federal government a central and controlling role
in the regulation of energy production, marketing, and
distribution. However, it is equally clear that the jurisdiction
of federal courts is limited, and may not be expanded by judicial
decree or in the absence of a federal question or issue. On its
face, Plaintiffs' complaint alleges only violations of state law.
The Court concludes that Congress did not intend for the federal
government to entirely occupy the field with the Federal Power
Act, thereby completely preempting Plaintiffs' state law claims
and converting them into federal questions. Further, although
Plaintiffs' claims might conceivably be cast in federal terms, a
plaintiff is the master of his or
her own claims; the Court need not recast Plaintiffs' state
causes of action into federal causes because Plaintiffs' claims
can all be resolved with reference to or resolution of
substantial federal questions or issues. Accordingly, the Court
concludes that it lacks jurisdiction and remands these matters to
the originating state courts.
A. The limits of federal removal jurisdiction.
The Court begins with several propositions regarding removal
jurisdiction. Foremost among these is the following:
Federal courts are courts of limited jurisdiction.
They possess only that power authorized by
Constitution and statute, which is not to be expanded
by judicial decree. It is to be presumed that a cause
lies outside this limited jurisdiction, and the
burden of establishing the contrary rests upon the
party asserting jurisdiction.
Kokkonen v. Guardian Life Ins. Co. of America, 511 U.S. 375,
377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994) (citations omitted).
It logically follows that removal jurisdiction is extremely
limited. Accordingly, the removal statute, 28 U.S.C. § 1441, is
strictly construed against removal, see Clinton v. Acequia,
Inc., 94 F.3d 568, 573 (9th Cir. 1996), citing Sullivan v.
First Affiliated Sec., Inc., 813 F.2d 1368, 1372 (9th Cir.
1987), and "[f]ederal jurisdiction must be rejected if there is
any doubt as to the right of removal in the first instance."
Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992), citing
Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir.
1979). Furthermore, "a defendant may remove a case only if the
claim could have been brought in federal court." Merrell Dow
Pharm., Inc. v. Thompson, 478 U.S. 804, 808, 106 S.Ct. 3229, 92
L.Ed.2d 650 (1986).
Ordinarily, "[t]he presence or absence of federal-question
jurisdiction is governed by the `well-pleaded complaint rule,'
which provides that federal jurisdiction exists only when a
federal question is presented on the face of the plaintiff's
properly pleaded complaint." Caterpillar, Inc. v. Williams,
482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987). This rule
is based upon three key jurisdictional principles: "that the
plaintiff is the master of the complaint, that a federal question
must appear on the face of the complaint, and that the plaintiff
may, by eschewing claims based on federal law, choose to have the
cause heard in state court." Caterpillar, Inc., 482 U.S. at
398-99, 107 S.Ct. 2425. The well-pleaded complaint rule also bars
federal courts from asserting jurisdiction based on the existence
of a federal defense, even if the defense is anticipated by the
complaint, because a defense is not part of a plaintiff's
properly-pleaded statement of his or her claim. See Rivet v.
Regions Bank of Louisiana, 522 U.S. 470, 475, 118 S.Ct. 921, 139
L.Ed.2d 912 (1998); Metropolitan Life Ins. Co. v. Taylor,
481 U.S. 58, 63, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987).
However, "a plaintiff may not defeat removal by omitting to
plead necessary federal questions in a complaint." Franchise Tax
Bd. of California v. Construction Laborers Vacation Trust for S.
California, 463 U.S. 1, 22, 103 S.Ct. 2841, 77 L.Ed.2d 420
(1983). A federal court may exercise removal jurisdiction under
the "artful pleading" doctrine, even if a federal question does
not appear on the face of a well-pleaded complaint, in three
circumstances. First, a state law claim may be removed "in the
rare instances where Congress has chosen to regulate the entire
field." ARCO Envtl. Remediation, L.L.C. v. Department of Health
& Envtl. Quality of Montana, 213 F.3d 1108,
1114 (9th Cir. 2000). See also Metropolitan Life, 481 U.S. at
63-64, 107 S.Ct. 1542 ("Federal pre-emption is ordinarily a
federal defense to the plaintiff's suit. As a defense, it does
not appear on the face of a well-pleaded complaint, and,
therefore, does not authorize removal to federal court. One
corollary of the well-pleaded complaint rule developed in the
case law, however, is that Congress may so completely pre-empt a
particular area that any civil complaint raising this select
group of claims is necessarily federal in character.") Second, a
state law claim may be recharacterized as federal and,
accordingly, removed where the claim is necessarily federal in
character. ARCO Envtl. Remediation, 213 F.3d at 1114. Third, a
state law claim also may be recharacterized as federal and
removed where the right to relief depends on the resolution of a
substantial, disputed federal question. Id. As might be
surmised from the narrowness of removal jurisdiction and the
longstanding recognition that a plaintiff is the master of his or
[t]he "artful pleading" doctrine is a narrow
exception to the straightforward rules of removal
jurisdiction, which we will apply only if "the
particular conduct complained of [is] governed
exclusively by federal law." Further, we will invoke
the doctrine "only in exceptional circumstances as it
raises difficult ...