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Barillas v. FCA U.S. LLC

United States District Court, C.D. California

July 3, 2019

Pedro W. Barillas et al.
v.
FCA U.S. LLC et al.

          Present: The Honorable STEPHEN V. WILSON, U.S. DISTRICT JUDGE

          CIVIL MINUTES - GENERAL

         Proceedings: IN CHAMBERS ORDER GRANTING PLAINTIFFS' MOTION TO REMAND [22] AND DENYING DEFENDANT'S MOTION FOR JUDGMENT ON THE PLEADINGS [23]

         I. Introduction and Background

         On March 1, 2019, Plaintiffs Pedro W. Barillas and Ingrid Martinez filed the instant suit against Defendants FCA U.S. LLC and BN Dealership I, LLC (dba West Valley Chrysler Jeep). Dkt. 3, Ex. A. Plaintiffs assert claims against Defendant FCA for: (1) violation of the Song-Beverly Act (breach of express warranty); (2) violation of the Song-Beverly Act (breach of implied warranty); and (3) violation of Cal. Civ. Code § 1793.2. Plaintiffs bring one claim against Defendant West Valley Chrysler Jeep for negligent repair. Id.

         On April 8, 2019, Defendant FCA removed the action to this Court. Dkt. 1. The alleged basis for removal was diversity of citizenship. Id. at 3. Plaintiffs now move to remand the action to state court on the ground that Defendants have not met their burden to establish diversity jurisdiction. Dkt. 22.

         II. Summary of Allegations

         A. Allegations of the Complaint

         The crux of Plaintiffs' allegations is that in 2012, Plaintiffs purchased a new 2012 Jeep Grand Cherokee that was manufactured and/or distributed by Defendant FCA. Dkt. 3, Ex. A ¶¶ 9, 14. The vehicle was delivered to Plaintiffs with, and further developed, a variety of defects during the warranty period, including suspension, electrical, engine, and transmission defects. Id. ¶ 10. Plaintiffs allege that Defendant FCA was unable to conform their vehicle to the applicable express warranties after a reasonable number of repair attempts. Id. ¶ 24. Plaintiffs also allege that they delivered the vehicle to Defendant West Valley Chrysler Jeep for repair on numerous occasions, and that it failed to properly store, prepare, and repair the vehicle in accordance with industry standards. Id. ¶¶ 58, 60. Plaintiffs seek actual damages, restitution, and civil penalties. Id. at 8.

         B. Allegations Regarding Removal

         Defendant FCA alleged removal jurisdiction based on complete diversity of the parties. Defendant FCA is a limited liability company, organized under the laws of the State of Delaware and with its principal place of business in Michigan. Dkt. 24 at 5. Plaintiffs are citizens and residents of the State of California. Id. Defendant West Valley Chrysler Jeep is also alleged to be a citizen of California. Id. However, Defendant FCA alleges that Defendant West Valley Chrysler Jeep is a sham defendant, joined only to defeat diversity jurisdiction. Id. at 5-6.

         III. Legal Standard

         United States federal courts are courts of limited jurisdiction. Gunn v. Minton, 568 U.S. 251, 256 (2013). Consequently, a “federal court is presumed to lack jurisdiction in a particular case unless the contrary affirmatively appears.” Stock West, Inc. v. Confederated Tribes, 873 F.2d 1221, 1225 (9th Cir. 1989). Due to this presumption, federal courts must exercise “prudence and restraint” when considering the propriety of removal. Merrell Dow Pharm. Inc. v. Thompson, 478 U.S. 804, 810 (1986). Thus, “[i]f a district court determines at any time that less than a preponderance of the evidence supports the right of removal, it must remand the action to the state court.” Hansen v. Grp. Health Coop., 902 F.3d 1051, 1057 (9th Cir. 2018). “The removing defendant bears the burden of overcoming the ‘strong presumption against removal jurisdiction.'” Id. (quoting Geographic Expeditions, Inc. v. Estate of Lhotka ex rel. Lhotka, 599 F.3d 1102, 1107 (9th Cir. 2010)).

         IV. Analysis

         Plaintiffs contend that Defendants have failed to meet their burden to establish diversity jurisdiction because they have not established that Defendant West Valley Chrysler Jeep is fraudulently joined. Only if a court finds that a defendant was fraudulently joined simply to defeat complete diversity and the defendant “cannot be liable on any theory” may the court disregard the citizenship of the “sham” defendant for removal purposes. Ritchey v. Upjohn Drug Co., 139 F.3d 1313, 1318 (9th Cir. 1998); see also Morris v. Princess Cruises, Inc., 236 F.3d 1061, 1067 (9th Cir. 2001) (stating that fraudulent joinder occurs where a plaintiff's failure to state a claim is “obvious according to the settled rules of the state”); Hunter v. Philip Morris USA, 582 F.3d 1039, 1046 (9th Cir. 2009) (“[I]f there is a possibility that a state court would find that the complaint states a cause of action against any of the resident defendants, the federal court must find that the joinder was proper and remand the case to the state court.”) (emphasis added). ...


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