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Winn v. Chrysler Group

December 23, 2009

DANIEL STACEY WINN, INDIVIDUALLY AND ASSUCCESSOR IN INTEREST TO PETRA MONIKA WINN, DECEASED, KORY MICHAEL WINN, INDIVIDUALLY AND AS SUCCESSOR IN INTEREST TO PETRA MONIKA WINN, DECEASED, BREEONNA WINN, INDIVIDUALLY AND AS SUCCESSOR IN INTEREST TO PETRA MONIKA WINN, DECEASED, ERIKA WINN, INDIVIDUALLY AND AS SUCCESSOR IN INTEREST TO PETRA MONIKA WINN, DECEASED, PLAINTIFFS,
v.
CHRYSLER GROUP, LLC, A DELAWARE CORPORATION, SUCCESSOR IN INTEREST TO DAIMLER CHRYSLER CORPORATION; MAGNA POWERTRAIN, INC.; MAGNA INTERNATIONAL OF AMERICA, INC. ALSO KNOWN AS MAGNA POWERTAIN; GREAT VALLEY CHRYSLER JEEP, AN UNKNOWN BUSINESS ENTITY; ENTERPRISE RENT-A-CAR COMPANY, A CALIFORNIA CORPORATION; S.J. DENHAM, INC., A CALIFORNIA CORPORATION, DEBORAH MATISENGLE; AND DOES 1 THROUGH 100, INCLUSIVE, DEFENDANTS.



The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge

MEMORANDUM AND ORDER

Plaintiffs have moved to remand this case back to the Superior Court of the State of California in and for the County of Shasta, where it originated, on grounds that the claims against Defendant Chrysler Group, who removed the case to this Court, do not arise under federal law. Alternatively, Plaintiffs also argue for remand on equitable grounds and further assert that this Court should abstain from hearing the matter. As set forth below, Plaintiffs' Motion to Remand will be granted.

BACKGROUND

This wrongful death case arises from a motor vehicle accident that occurred in Shasta County, California on August 13, 2007 as Plaintiffs' decedent, Petra Monika Winn, was driving a 2004 Chrysler Sebring automobile. Ms. Winn was killed as a result of the accident. Through this action, Plaintiffs seeks damages against alleged manufacturers/suppliers of the Chrysler vehicle and its component parts (Defendants Chrysler Group, LLC/Daimler AG and Defendants Magna Powertrain/Magna International, who allegedly furnished the gas tank utilized in the vehicle). Additionally, Defendants include Great Valley Chrysler Jeep, who purportedly sold the Chrysler vehicle to Defendant Enterprise Rent-a-Car, S.J. Denham, Inc. who bought the vehicle from Great Valley and sold it to Plaintiffs' decedent, and Defendant Deborah Matisengle, who apparently drove the other vehicle involved in the accident.

Defendant Chrysler Group removed the action to this Court on grounds that under the terms of its purchase of Chrysler assets from Chrysler Group's predecessor in interest, Chrysler Corp. LLC (who is not a Defendant in this lawsuit), any successor liability on Chrysler Group's part was specifically excepted. Because that agreement was approved by the bankruptcy court overseeing Chrysler Corp.'s bankruptcy proceeding, Defendant Chrysler Group removed Plaintiff's entire case to federal court pursuant to 28 U.S.C §§ 1452(a) and 1334, which provide for federal jurisdiction on cases arising under or related to bankruptcy proceedings under Title 11.

Plaintiffs argue that because the bankruptcy proceedings as to Defendant Chrysler Group's predecessor at most give rise to a defense available to Chrysler Group in this matter, it does not arise under federal law because it does not derive from the allegations of Plaintiffs' complaint itself. Plaintiffs further contend that equitable grounds also mandate remand. They point out that their complaint itself alleges only state law causes of action, argue that Chrysler Group's potential bankruptcy defense relates only to one of several different defendants sued in this matter, and emphasize that the bankruptcy debtor, Chrysler Corp. LLC, is not even a party to this lawsuit.

Defendant Chrysler Group argues that federal jurisdiction is invoked because this matter qualifies as a "core" proceeding with regard to Chrysler Corp's bankruptcy. Chrysler Group alternatively argues that Plaintiffs' claims against it are "related" to the bankruptcy case in that they directly challenge the bankruptcy debtor's sale of assets.

Finally, Chrysler Group argues that this Court has exclusive jurisdiction over bankruptcy issues like those raised herein, and that in any event the equities weigh in favor of exercising jurisdiction.

STANDARD

A defendant may remove any civil action from state court to federal district court if the district court has original jurisdiction over the matter. 28 U.S.C. § 1441(a). Generally, district courts have original jurisdiction over civil actions in two instances: (1) where there is complete diversity between the parties, or (2) where a federal question is presented in an action arising under the Constitution, federal law, or treaty.

28 U.S.C. §§ 1331 and 1332.

The removing party bears the burden of establishing federal jurisdiction. Ethridge v. Harbor House Rest., 861 F.2d 1389, 1393 (9th Cir. 1988). Furthermore, courts construe the removal statute strictly against removal. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (citations omitted). If there is any doubt as to the right of removal in the first instance, remand must be granted. See Gaus, 980 F.2d at 566. Therefore, if it appears before final judgment that a district court lacks subject matter jurisdiction, the case shall be remanded to state court.

28 U.S.C. § 1447(c).

The district court determines whether removal is proper by first determining whether a federal question exists on the face of the plaintiff's well-pleaded complaint. Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987). If a complaint alleges only state-law claims and lacks a federal question on its face, then the federal court must grant the motion to remand. See 28 U.S.C. ยง 1447(c); Caterpillar, 482 U.S. at 392. Nonetheless, there are rare exceptions when a well--pleaded state-law cause of action will be deemed to arise under federal law and support removal. They are "(1) where federal law completely preempts state law, (2) where the claim is necessarily federal in character, or (3) where the right to relief depends on the ...


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