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Zhai v. Stein Tree Services Inc.

United States District Court, N.D. California

January 9, 2015

ANN ZHAI, Plaintiff,
STEIN TREE SERVICES INC., et al., Defendants.


JOSEPH C. SPERO, Magistrate Judge.


This case originates from a traffic accident that occurred in Delaware in November of 2008. Plaintiff Ann Zhai alleges that the accident led her to discover an "illegal trucking scheme" operating in Delaware, as well as a conspiracy to conceal the purported scheme. Her Complaint also includes allegations related to an action that she brought in Delaware state court regarding the same or similar issues. Zhai does not allege that any conduct at issue occurred in this district.

The undersigned granted Zhai's application to proceed in forma pauperis and now reviews the Complaint for sufficiency pursuant to 28 U.S.C. § 1915(e)(2). For the reasons stated below, the undersigned recommends that the Complaint be DISMISSED for improper venue, with leave to amend if Zhai is aware of facts that would show venue to be proper in this district. Because Zhai has declined magistrate judge jurisdiction pursuant to 28 U.S.C. § 636(c), this case will be reassigned to a United States district judge for further proceedings.


A. The Parties

Plaintiff Ann Zhai is currently a California resident. It is not clear where she resided at the time of the accident, but she was not a Delaware resident. See Compl. (dkt. 1) ¶ 41. Zhai was traveling through Delaware due to a family emergency. Id. ¶ 57.

Zhai's Complaint names the following Defendants: (1) Stein Tree Services, Inc. ("Stein Tree"), an "interstate motor carrier... which employed a fleet of Boom Trucks and other commercial utility vehicles for forestry risk management and property transportation in Maryland, New Jersey, and Delaware"; (2) Jeffrey Stein, the president of Stein Tree; (3) Hartford Mutual Insurance Company ("Hartford"), Stein Tree's insurance carrier, based in Maryland; (4) Robin Raymond, an individual to whom Hartford assigned a third-party claim; (5) Weber Gallagher Simpson Stapleton Fires & Newby LLC ("Weber"), a "general practice law firm headquarted in Philadelphia with multiple locations in [the] Northeast and Mid-Atlantic region[s] of the United States"; (6) Mary E. Sherlock, an attorney employed by Weber; (7) the Honorable Richard R. Cooch, a judge of the Superior Court of Delaware; and (8) the state of Delaware. Id. ¶¶ 4-8.

B.Zhai's Allegations

Zhai alleges that on November 11, 2008, she was stopped at a red light at the intersection of "Delaware highways 3 and 13" when her car was struck by a boom truck. Id. ¶¶ 40, 42. The boom truck was unmarked, and did not have state or federal Department of Transportation decal. Id. ¶¶ 43-44. The operator of the truck informed Zhai that he was employed by"Stein Tree, that his boss was Jeffrey Stein, and that Hartford was the primary insurance carrier for the truck. Id. ¶¶ 52-54. Zhai contacted Mr. Stein by telephone, but alleges that he refused to provide her with documents such as his insurance contract with Hartford or maintenance records for the truck. Id. ¶¶ 58-64.

Zhai filed a claim with Hartford, and an insurance adjuster determined that her vehicle was a total loss. Id. ¶¶ 70-71. Hartford declined to provide certain documents and information to Zhai. Id. ¶¶ 72-76. Hartford did, however, provide a check for the total loss value of Zhai's vehicle. Id. ¶ 77. Zhai alleges that the check bore a different policy number than the truck operator had given her at the scene of the accident. Id. Zhai then filed a lawsuit in state court, which she describes as follows:

"Zhai" duly and timely filed Zhai v. Stein & Stein Tree services, Inc. in Delaware superior court under the condition if "Hartford" and "Stein Tree" have conspired to conceal the jurisdictional facts as allege in ¶¶30-31-32 with intent to defraud "Zhai" due to her race, gender and vulnerability of family medical emergency, defense counsels [s]hall remove to Federal court pursuant to Article III §2 of Constitution.

Id. ¶ 78 (brackets in original). Sherlock was assigned to defend the claim on behalf of Hartford. Zhai alleges that "[w]ithin 30 days of receipt of the complaint, nobody answered the complaint." Id. ¶ 80. It is difficult to discern from Zhai's allegations what happened in the state court action. It appears that her claim may have been dismissed, or at least that a motion to dismiss was filed:

Delaware state court imposed private settlement in the absence of jurisdiction: Ms. Sherlock and "Weber" violated 18 U.S.C. §1952 when they knew Delaware state court lacked remedy or contradicted to Federal remedy. When extortion of private settlement failed, Ms. Sherlock immediately caused motion to dismiss via U.S. ...

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