United States District Court, N.D. California, San Jose Division
ORDER REMANDING CASE TO STATE COURT RE: DKT. NOS. 24,
VIRGINIA K. DEMARCHI UNITED STATES MAGISTRATE JUDGE.
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.
reasons discussed below, the Court determines that it lacks
federal diversity jurisdiction over this action.
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.
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.
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.
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
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. §
Amount in Controversy
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