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Alvarez v. Transitamerica Services, Inc.

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

September 24, 2019

ALBERT C. ALVAREZ, Plaintiff,
v.
TRANSITAMERICA SERVICES, INC., et al., Defendants.

          ORDER GRANTING PLAINTIFF'S MOTION TO REMAND; REMANDING ACTION TO SANTA CLARA COUNTY SUPERIOR COURT RE: DKT. NO. 35

          EDWARD J. DAVILA UNITED STATES DISTRICT JUDGE.

         Plaintiff moves for this case to be remanded claiming this Court lacks subject matter jurisdiction. Because the complaint does not allege Article III standing for the federal claims, there is no federal question jurisdiction and so, there is necessarily no supplemental jurisdiction. Accordingly, Plaintiff’s motion is GRANTED, and this case is remanded to the Santa Clara County Superior Court. See 28 U.S.C. § 1447(c).

         I. BACKGROUND

         A. Factual Background

         Plaintiff Albert C. Alvarez (“Plaintiff”) initiated this putative class action in the Santa Clara Superior Court asserting that Defendants TransitAmerica Services and Herzog Transit Services (“Defendants”) violated federal and state laws. The federal claims alleged violations of the Fair Credit Reporting Act (“FCRA”), which occurred when Defendants obtained background checks for Plaintiff’s employment. Plaintiff asserted analogous California state law claims under Investigative Consumer Reporting Agencies Act (“ICRAA”), Consumer Credit Reporting Agencies Act (“CCRAA”), and unfair competition law (“UCL”). Plaintiff also included claims that Defendants failed to provide meal periods, rest periods, pay hourly and overtime wages, accurate written wage statements, and timely pay all final wages.

         Plaintiff claims that Defendants routinely acquired consumer, investigative, and credit reports (i.e., credit and background reports) to conduct background checks on Plaintiff and other prospective, current, and former employees. Second Amended Complaint (“SAC”) ¶ 2, Dkt. 26. Defendants then used information from the reports in their hiring process without providing or obtaining proper disclosures/authorizations in compliance with federal and state law. Id.

         Plaintiff alleges two FCRA claims. First, that Defendants willfully failed to provide proper disclosures because the authorization did not “stand alone” as required by 15 U.S.C. § 1681b(b)(2)(A) and “[a]s a result of Defendants’ unlawful procurement of credit and background reports by way of their inadequate disclosures, . . . Plaintiff and class members have been injured, including but not limited to, having their privacy and statutory rights invaded in violation of the FCRA.” SAC ¶¶ 46, 56. Second, that Defendants failed to give proper “summary of rights” as required by 15 U.S.C. § 1681d(a)(1) and 15 U.S.C. § 1681g(c). Id. ¶¶59–70. Plaintiff incorporates the same allegations of injury for this second cause of action. See SAC ¶ 59. Finally, Plaintiff seeks declaratory and restitutionary relief for the FCRA claims. SAC ¶ 180.

         B. Procedural History

         Defendants removed the action to federal court, invoking federal question jurisdiction over the FCRA claims and supplemental jurisdiction over the other state-law claims. See Dkt. 1. Plaintiff moves to remand, arguing that because he lacks Article III standing for his FCRA claim, removal was improper as this Court lacks subject matter jurisdiction. See Pl. Motion to Remand (“Pl. Mot.”); Dkt. 35.

         II. LEGAL STANDARDS

         Removal of a civil action from state to federal court is appropriate only if the federal court has subject matter jurisdiction over the matter. 28 U.S.C. § 1444(a). If a case is improperly removed, “the federal court must remand the action because it has no subject-matter jurisdiction to decide the case.” ARCO Envtl. Remediation, LLC v. Dep’t of Health & Envtl. Quality of the State of Mont., 213 F.3d 1108, 1113 (9th Cir. 2000); 28 U.S.C. 1447(c) (“If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.”). On a motion to remand, federal courts must presume that a cause of action lies beyond its subject matter jurisdiction. Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 2009). The burden to establish that jurisdiction exists rests upon the party asserting jurisdiction. Id. The “strong presumption” against removal jurisdiction means that the court “resolves all ambiguity in favor of remand to state court.” Id. (quoting Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (per curiam)).

         Article III of the United States Constitution limits the jurisdiction of the federal courts to actual “cases” and “controversies.” U.S. Const. art. III, § 2. To satisfy the case-or-controversy requirement, a plaintiff must have standing to bring a claim. See, e.g., Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118, 125 (2014); Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016). Article III standing requires that a plaintiff have: (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) is likely to be redressed by a favorable judicial decision. Lujan v. Defs. of Wildlife, 504 U.S. 555, 560–61 (1992). To establish an injury in fact required for Article III standing, “a plaintiff must show that he or she suffered an invasion of a legally protected interest that is concrete and particularized and actual or imminent.” Spokeo, 136 S.Ct. at 1548. For an injury to be “particularized” it “must affect the plaintiff in a personal and individual way.” Id.; see also Valley Forge Christian Coll. v. Ams. United for Separation of Church and State, 454 U.S. 464, 472 (1982) (standing requires that the plaintiff “‘personally has suffered some actual or threatened injury’”). A “concrete” injury must be “de facto;” it must be “real” and “actually exist.” Spokeo, 136 S.Ct. at 1548.

         III. DISCUSSION

         A. Federal ...


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