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Buchanan v. Aramark Campus, LLC

United States District Court, N.D. California, San Jose Division

July 23, 2019

ROBERT BUCHANAN, Plaintiff,
v.
ARAMARK CAMPUS, LLC, et al., Defendants.

          ORDER REMANDING CASE TO STATE COURT RE: DKT. NOS. 24, 25

          VIRGINIA K. DEMARCHI UNITED STATES MAGISTRATE JUDGE.

         Plaintiff Robert Buchanan sues for himself and on behalf of a putative class (and several subclasses) claiming that defendants Aramark Campus, LLC and Aramark Sports, LLC committed wage and hour violations contrary to various provisions of the California Labor Code. According to his complaint, Mr. Buchanan was employed by defendants for several years, first as a concessions worker, and then as a concessions supervisor, at defendants' facilities and in connection with their operations at the SAP Center in San Jose, California. Essentially, Mr. Buchanan claims that defendants did not pay him for hours worked beyond his scheduled shift hours; did not permit him to take legally required meal and rest breaks; failed to maintain and provide accurate wage statements; and did not timely pay all wages due upon termination of employment. The putative class members are individuals who, at any time from four years prior to the filing of this lawsuit, were “employed as non-exempt, hourly concessions managers in connection with the concessions operations and services Defendants provide at facilities and venues within the State of California.” Dkt. No. 1-1 ¶ 37.

         For the reasons discussed below, the Court determines that it lacks federal diversity jurisdiction over this action.

         I. BACKGROUND

         Mr. Buchanan filed this action in the Santa Clara County Superior Court on December 10, 2018, asserting nine claims for relief: (1) failure to pay minimum wages, Cal. Labor Code §§ 204, 1194, 1197; (2) failure to pay wages and overtime, Cal. Labor Code § 510; (3) meal period liability, Cal. Labor Code § 226.7; (4) rest-break liability, Cal. Labor Code § 226.7; (5) failure to provide accurate, itemized wage statements, Cal. Labor Code § 226(a); (6) failure to pay for all hours worked, Cal. Labor Code § 221; (7) failure to timely pay all wages earned, Cal. Labor Code § 204; (8) failure to timely pay all wages due at termination, Cal. Labor Code § 203; and (9) unlawful and unfair business practices, Cal. Bus. & Prof. Code § 17200, et seq. Dkt. No. 1-1.

         Defendants answered Mr. Buchanan's complaint on January 18, 2019 and subsequently removed the matter here on January 22, 2019, asserting diversity jurisdiction under 28 U.S.C. § 1332(a). Dkt. No. 1. On February 14, 2019, Mr. Buchanan filed a First Amended Complaint (“FAC”), adding a representative claim under the California Private Attorneys General Act (“PAGA”), Cal. Labor Code §§ 2698, et seq., which provides for civil penalties stemming from defendants' alleged conduct that violates the California Labor Code. Dkt. No. 13. The FAC acknowledges, but does not endorse, defendants' assertion that diversity jurisdiction exists. Id. ¶ 9. Defendants answered the FAC. Dkt. No. 15.

         In the parties' joint case management statement (Dkt. No. 18), defendants advised that on January 7, 2019, in connection with a matter pending before the California Division of Labor Standards Enforcement, Mr. Buchanan signed a general release of all claims against them. Defendants contend that the release extinguished Mr. Buchanan's claims in the present suit and that this action therefore should be dismissed. Mr. Buchanan's counsel does not deny that Mr. Buchanan signed a release, although counsel questions the circumstances under which that release was obtained and suggests that the release was the product of overreaching by defendants. Additionally, counsel claims that Mr. Buchanan did not notify him about that release and that defendants said nothing about it until shortly before the scheduled April 23, 2019 initial case management conference before this Court. In any event, Mr. Buchanan's counsel requests permission to conduct early discovery in order to find a new plaintiff. Defendants objected to Mr. Buchanan's request for such discovery.

         The Court directed the parties to brief the propriety of defendants' removal to this Court and Mr. Buchanan's standing to pursue this action, including:

1. How the relief sought by the complaint (including any attorney's fees) should be measured for purposes of establishing the $75, 000 amount-in-controversy threshold for diversity jurisdiction, where at the time of removal, the removing party has knowledge of bases for potential dismissal of the action; and
2. Whether there is a genuine dispute of material fact regarding the validity or enforceability of the release at issue, and if so, whether discovery is necessary and sufficient to resolve the dispute.

Dkt. No. 23. The parties timely submitted their briefs, and the Court held a hearing on the matter on June 4, 2019. Defendants maintain that they properly removed this action based on diversity jurisdiction, and that this matter must be dismissed in view of Mr. Buchanan's general release. Mr. Buchanan does not dispute that complete diversity of citizenship exists. However, he contends that this matter must be remanded to the state court because defendants have not met their burden to establish that the amount in controversy exceeds the $75, 000 threshold. Assuming the Court has diversity jurisdiction over this case, the parties disagree whether Mr. Buchanan may pursue the PAGA claim. Upon consideration of the papers submitted, as well as the arguments of counsel, the Court concludes that defendants have not met their burden to establish that diversity jurisdiction exists and therefore remands this matter to the state court.[1]

         II. DISCUSSION

         A. Diversity Jurisdiction

         Federal district courts have diversity jurisdiction over civil actions in which the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs, and is between citizens of different states. 28 U.S.C. § 1332(a). Diversity jurisdiction is measured at the time a lawsuit is filed. See generally Grup Dataflux v. Atlas Global Group, L.P., 541 U.S. 567, 570-71 (2004). Removal to federal court is proper where the federal court would have original subject matter jurisdiction over the complaint. 28 U.S.C. § 1441. The removal statutes are strictly construed against removal and place the burden on defendants to demonstrate that removal is proper. 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. 1992)). Additionally, the Court has a continuing duty to determine whether it has subject matter jurisdiction. Fed.R.Civ.P. 12(h). A case must be remanded to the state court if it appears at any time before final judgment that the court lacks subject matter jurisdiction. 28 U.S.C. § 1447(c).

         B. Amount in Controversy

         Because the amount in controversy is not evident from the face of Mr. Buchanan's pleadings, defendants must prove, by a preponderance of the evidence, that the jurisdictional threshold is met. Fritsch v. Swift Transp. Co. of Arizona, LLC, 899 F.3d 785, 793 (9th Cir. 2018); Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996). “Under this burden, the defendant[s] must provide evidence establishing that it is more likely than not that the amount in controversy exceeds that amount.” Sanchez, 102 F.3d at 404 (internal quotations and citations omitted). To discharge their burden, defendants must do more than present speculation or conclusory allegations. Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1117 (9th Cir. 2004). The Court may consider the complaint, facts presented in the removal petition, and any summary-judgment type evidence relevant to the amount in controversy at the ...


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