Mendoza v. Pacific Theatres Entertainment Corp.

          ORDER GRANTING PLAINTIFF'S MOTION TO REMAND [DKT. 21]

          CORMAC J. CARNEY, UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION AND BACKGROUND

         On September 17, 2019, Plaintiff Roberto A. Mendoza filed this action in Los Angeles County Superior Court against Defendants Pacific Theatres Entertainment Corporation and the Decurion Corporation. (Dkt. 1-1 [Complaint, hereinafter “Compl.”].) Plaintiff alleges that Defendants violated the Fair and Accurate Credit Transactions Act (“FACTA”)-an amendment to the Fair Credit Reporting Act (“FCRA”)-which requires merchants to print only limited credit and debit card information on receipts. (Compl. ¶ 1.) Specifically, Plaintiff alleges that he received a receipt at a Pacific Theaters location with the first six digits and the last four digits of his debit card printed on it. (Id. ¶¶ 40-41.)

         Defendants removed to this Court on October 24, 2019, invoking federal question jurisdiction. (Dkt. 1 [Notice of Removal].) On November 19, 2019, Plaintiff filed a motion to remand the action to Los Angeles County Superior Court, arguing that this Court does not have subject matter jurisdiction because Plaintiff lacks Article III standing. (Dkt. 21, hereinafter “Mot.”) For the following reasons, Plaintiff's motion is GRANTED.^[1]

         II. LEGAL STANDARD

         A defendant may remove a civil action filed in state court to a federal district court if the federal court would have had original jurisdiction over the action. 28 U.S.C. § 1441. Federal courts have subject matter jurisdiction over cases that (1) involve questions arising under federal law or (2) are between diverse parties and involve an amount in controversy that exceeds $75, 000. 28 U.S.C. §§ 1331, 1332. Principles of federalism and judicial economy require courts to “scrupulously confine their [removal] jurisdiction to the precise limits which [Congress] has defined.” See Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 109 (1941). Indeed, “[n]othing is to be more jealously guarded by a court than its jurisdiction.” See United States v. Ceja-Prado, 333 F.3d 1046, 1051 (9th Cir. 2003) (internal quotations omitted). The defendant removing the action to federal court bears the burden of establishing that the district court has subject matter jurisdiction over the action, and the removal statute is strictly construed against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (“Federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance.”).

         “A suit brought by a plaintiff without Article III standing is not a ‘case or controversy,' and an Article III federal court therefore lacks subject matter jurisdiction over the suit.” Cetacean Cmty. v. Bush, 386 F.3d 1169, 1174 (9th Cir. 2004) (citing Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 101 (1998)). To satisfy Article III's standing requirement, “a plaintiff must show (1) that it has suffered an ‘injury in fact' that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.” Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 181 (2000). Defendants, as the party asserting federal jurisdiction, bear the burden of establishing Plaintiffs' Article III standing. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992).

         “[A] removed case in which the plaintiff lacks Article III standing must be remanded to state court under § 1447(c).” Polo v. Innoventions Int'l, LLC, 833 F.3d 1193, 1196 (9th Cir. 2016) (emphasis added); see Davidson v. Kimberly-Clark Corp., 889 F.3d 956, 970 n.6 (9th Cir. 2018) (“As a general rule, if the district court is confronted with an Article III standing problem in a removed case-whether the claims at issue are state or federal-the proper course is to remand for adjudication in state court.”); Envtl. Research Ctr. v. Heartland Prod., 29 F.Supp.3d 1281, 1283 (C.D. Cal. 2014) (remanding the action because the plaintiff lacked a cognizable Article III injury). “Remand is the correct remedy” when a district court lacks subject-matter jurisdiction, because “the federal courts have no power to adjudicate the matter, ” while “[s]tate courts are not bound by the constraints of Article III.” Polo, 833 F.3d at 1196 (citing ASARCO Inc. v. Kadish, 490 U.S. 605, 617 (1989)).

         III. DISCUSSION

         Plaintiff argues that his complaint fails to establish Article III standing because he alleges nothing more than a bare procedural violation of the FACTA. Defendants oppose his motion, arguing that Plaintiff has sufficiently alleged injury in fact. (Dkt. 26, hereinafter “Opp.”) Specifically, Defendants cite the following alleged injury from printing too many digits on the receipt:

1. “[H]eightened risk of identity theft, ” (Compl. ¶ 80),

2. Disclosure of Plaintiff's private financial information “to the world, including to persons who might find the receipts in the trash or elsewhere, including identity thieves who thrive in environments such as Defendants' box office locations, ” and to those of Defendants' employees who handled the receipt, (id. ¶¶ 43, 52, 80), and

3. Being “forced . . . to take action to prevent further disclosure of the private information displayed on the receipt, ” (id. ¶ 80), including by “tak[ing] steps to ...