United States District Court, N.D. California, San Jose Division
L.A.M.B. OXFORD MANAGEMENT AND TECHNOLOGY COMPANY, INC., Plaintiff,
ROBERT RUTKOWSKI, Defendant.
ORDER REMANDING CASE TO STATE COURT
H. KOH UNITED STATES DISTRICT JUDGE
March 20, 2018, Plaintiff L.A.M.B. Oxford Management and
Technology Company, Inc. (“Plaintiff”), a
California corporation, sued Defendant Robert Rutkowski
(“Defendant”), a resident of California, in
California state court for alleged misappropriation of trade
secrets and other related state law causes of action. ECF No.
1-1. On April 27, 2018, Defendant removed the case to federal
court based on federal question jurisdiction. See
ECF No. 1. On May 4, 2018, Defendant filed a motion to
dismiss and a motion for summary judgment. ECF No. 11. On May
25, 2018, Plaintiff filed an ex parte application for a
temporary restraining order. ECF No. 19. For the reasons
explained below, the Court concludes that it lacks subject
matter jurisdiction over this case. As a result, the case is
hereby REMANDED to state court for further proceedings.
may be removed from state court to federal court only if the
federal court would have had subject matter jurisdiction over
the case. 28 U.S.C. § 1441(a); see Caterpillar Inc.
v. Williams, 482 U.S. 386, 392 (1987) (“Only
state-court actions that originally could have been filed in
federal court may be removed to federal court by the
defendant.”). If it appears at any time before final
judgment that the federal court lacks subject matter
jurisdiction, the federal court must remand the action to
state court. 28 U.S.C. § 1447(c).
party seeking removal bears the burden of establishing
federal jurisdiction. Provincial Gov't of Marinduque
v. Placer Dome, Inc., 582 F.3d 1083, 1087 (9th Cir.
2009). “The removal statute is strictly construed, and
any doubt about the right of removal requires resolution in
favor of remand.” Moore-Thomas v. Alaska Airlines,
Inc., 553 F.3d 1241, 1244 (9th Cir. 2009) (citing
Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir.
Court to have federal question jurisdiction over a complaint,
the complaint must arise under federal law. 28 U.S.C. §
1331. Generally speaking, “[a] cause of action arises
under federal law only when the plaintiff's well-pleaded
complaint raises issues of federal law.” Hansen v.
Blue Cross of Cal., 891 F.2d 1384, 1386 (9th Cir. 1989).
“The well-pleaded complaint rule is the basic principle
marking the boundaries of the federal question jurisdiction
of the federal district courts.” Met. Life Ins. Co.
v. Taylor, 481 U.S. 58, 63 (1987) (internal quotation
marks omitted). Plaintiff's complaint asserts only state
law claims for misappropriation of trade secrets,
unauthorized access to computers, unfair competition,
interference with economic relations, intentional
interference with prospective business relations, negligent
interference with prospective business relations, and
declaratory and injunctive relief. See ECF No. 1-1
at 2, 7-13. Generally, a complaint that asserts only state
law claims does not arise under federal law. Taylor,
481 U.S. at 63.
sole basis that Defendant advances for federal question
jurisdiction is that Plaintiff's complaint “arises
under the Computer Fraud and Abuse Act.” ECF No. 1 at
2. Specifically, Plaintiff states in the context of its state
law misappropriation of trade secrets claim that Defendant is
“in violation of, inter alia, 18 U.S.C. §
1030, et seq., Penal Code § 502, et seq., and California
Civil Code § 3426, et seq.” See ECF No.
1-1 at ¶ 41. Aside from this passing mention to 18
U.S.C. § 1030 in Plaintiff's state law cause of
action, Plaintiff's complaint does not invoke any other
federal law or federal question.
question jurisdiction will lie over state law claims like
Plaintiff's only “in certain cases” where
those state law claims “implicate significant federal
issues.” Grable & Sons Metal Prods., Inc. v.
Darue Eng'g & Mfg., 545 U.S. 308, 312 (2005).
Under Grable, a federal court may exercise
jurisdiction over a state law claim only if (1) the action
necessarily raises a federal issue that is (2) disputed and
(3) substantial, and if (4) the court may entertain the case
without disturbing the congressionally approved balance of
federal and state judicial responsibilities. Id. at
314. The party seeking to establish jurisdiction must justify
a need for “the experience, solicitude, and hope of
uniformity that a federal forum offers on federal
issues.” Id. at 312.
Defendant fails to demonstrate that federal question
jurisdiction exists over Plaintiff's state law claims
under Grable. First, Defendant does not explain why
Plaintiff's state law cause of action for
misappropriation of trade secrets necessarily raises federal
issues. Instead, Defendant merely points generally to
Plaintiff's passing mention of 18 U.S.C. § 1030,
see ECF No. 1 at ¶ 7, without discussing the
particular federal issues that are implicated by
Plaintiff's state law misappropriation of trade secrets
cause of action. Indeed, to the extent that establishing the
underlying conduct is unlawful is required, it appears to be
possible that Plaintiff could prove a misappropriation of
trade secrets cause of action in a way that entirely avoids
18 U.S.C. § 1030 and relies instead on California Penal
Code § 502, which Plaintiff also invokes in the same
sentence of its complaint. Thus, although Plaintiff mentions
a federal law, the state law cause of action does not
necessarily raise a federal issue. See Grable, 545
U.S. at 314; K2 America Corp. v. Roland Oil & Gas,
LLC, 653 F.3d 1024 (9th Cir. 2011) (holding that federal
question jurisdiction did not exist where a lease was
governed “by [a] specific federal statutory and
regulatory scheme” but the plaintiff's cause of
action relating to the lease did not require the resolution
of a federal question of law). Moreover, none of Plaintiff s
causes of action are expressly brought under federal law.
because the Court lacks subject matter jurisdiction, the case
must be remanded to state court. See 28 U.S.C.
§ 1447(c); Smith v. Mylan Inc, 761 F.3d 1042,
1044 (9th Cir. 2014) (“Under § 1447(c), the
district court must remand “[i]f at any time before
final judgment it appears that the district court lacks
subject matter jurisdiction[.]'" (alterations in
foregoing reasons, the Court REMANDS the case to Santa Clara
County Superior ...