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O'Brien v. Ford Motor Company

United States District Court, C.D. California

February 27, 2018

Haley O'Brian, et al.
v.
Ford Motor Company, et al.

          PRESENT: HONORABLE DOLLY M. GEE, UNITED STATES DISTRICT JUDGE

          CIVIL MINUTES-GENERAL

         Proceedings: IN CHAMBERS - ORDER REMANDING ACTION TO LOS ANGELES COUNTY SUPERIOR COURT

         On December 18, 2017, Plaintiffs, California citizens, filed in the Los Angeles County Superior Court a Complaint, which alleged, as relevant here, violations of the Song-Beverly Act, Cal. Civ. Code § 1790 et seq.; state law fraud claims; and violation of the Consumer Legal Remedies Act (“CLRA”), Cal. Civ. Code § 1750 et seq., against Defendant Ford Motor Company (“Ford”), a Delaware citizen. [Doc. # 1-1.] The Complaint also alleged against Defendant NGP Motors, Inc. dba Sunrise Ford of North Hollywood (“NGP”), a California citizen, a state law cause of action for negligent repair. Id. In the Complaint, Plaintiffs sought general, special, and actual damages; rescission of the purchase contract and restitution of all monies expended, diminution in value; incidental and consequential damages, civil penalties, punitive damages, and reasonable attorney's fees. Id. at 32-33, Prayer for Relief. It is not clear when, if at all, Plaintiffs served Ford with the Complaint.

         On January 16, 2018, Plaintiffs filed a First Amended Complaint (“FAC”), which they served on Ford on January 18, 2018. [Doc. ## 1 (Notice of Removal (“NOR”)) at ¶ 22, 1-2 (FAC).] Similar to the Complaint, the FAC seeks general, special, and actual damages; rescission of the purchase contract and restitution of all monies expended, diminution in value, incidental and consequential damages, and civil penalties-but not punitive damages or reasonable attorney's fees. FAC at 32, Prayer for Relief. The FAC, unlike the Complaint, aims both the negligent repair and the CLRA causes of action against NGP. See FAC at ¶¶ 159-85.

         At least three considerations lead the Court to conclude that removal is improper here. The Court therefore REMANDS the action to the Los Angeles County Superior Court, as discussed further below.

         I. LEGAL STANDARD

         Pursuant to 28 U.S.C. section 1332(a)(1), a district court shall have jurisdiction over a civil action where the matter in controversy exceeds the sum or value of $75, 000 and there is complete diversity of citizenship between the parties. An action may be removed from a state court to a federal district court if the latter would have had “original jurisdiction” over the action had it been filed in that court. 28 U.S.C. § 1441(a).

         Fraudulently joined defendants are “ignored for purposes of determining diversity.” Morris v. Princess Cruises, Inc., 236 F.3d 1061, 1067 (9th Cir. 2001). To demonstrate that the removal of an action involving a non-diverse defendant was proper, the removing party must show fraudulent joinder by “clear and convincing evidence.” See Hamilton Materials, Inc. v. Dow Chem. Corp., 494 F.3d 1203, 1206 (9th Cir. 2007). Specifically, “[t]he defendant must show that there is no possibility that the plaintiff could prevail on any cause of action it brought against the non-diverse defendant” and that “plaintiff would not be afforded leave to amend his complaint to cure the purported deficiency.” Padilla v. AT&T Corp., 697 F.Supp.2d 1156, 1159 (C.D. Cal. 2009) (emphasis added).

         Related to fraudulent joinder is the doctrine of fraudulent misjoinder. Under the Federal Rules of Civil Procedure, two or more persons may be joined in one action when, as relevant here, a plaintiff “assert[s] a right to relief arising out of the same transaction and occurrence.” Visendi v. Bank of Am., N.A., 733 F.3d 863, 870 (9th Cir. 2013) (citing Fed.R.Civ.P. 20(a)). Where a plaintiff joins in the action “a resident defendant having no real connection with the controversy” between plaintiff and the nonresident defendant, the misjoinder is fraudulent. Sutton v. Davol, Inc., 251 F.R.D. 500, 503 (E.D. Cal. 2008). “A defendant's ‘right of removal cannot be defeated by'” such misjoinder. Id. In the case of fraudulent misjoinder, a district court may “at any time, on just terms, add or drop a party.” Fed.R.Civ.P. 21.

         “Federal jurisdiction [under the removal statute] must be rejected if there is any doubt as to the right of removal in the first instance.” See Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (emphasis added).

         II. DISCUSSION

         A. Amount in Controversy

         Contending that the $75, 000 minimum threshold is satisfied for purposes of the amount in controversy requirement in federal court, Ford argues that the FAC's sought relief, “[u]pon information and belief, ” is in excess of $75, 000 exclusive of interest and costs. NOR at ¶ 8. Ford has not established that the amount in controversy is satisfied.

         The purchase price of the vehicle at issue appears to have been $21, 380. See Ex. 1 to FAC; Ex. 1 to Complaint. No other dollar amounts appear anywhere on either the Complaint, FAC, or exhibits attached thereto. Accordingly, based on the Plaintiffs' Prayer for Relief alone, it is not clear how the amount in controversy is satisfied. Ford has thus failed to carry its burden of establishing federal jurisdiction. See Guglielmino v. McKee Foods Corp., 506 F.3d 696, 699 (9th Cir. 2007) (“[W]here it is unclear or ambiguous from the face of a state-court complaint whether the requisite amount in controversy is pled[, ] . . . . [t]he removing defendant bears the burden of establishing, by a preponderance of the evidence, that the amount in controversy exceeds [the jurisdictional amount].” (final alteration in original) (quoting Sanchez v Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996))); Gaus, 980 F.2d at 566-67 (“If it is unclear what amount of ...


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