Michael Chavez v. Time Warner Cable LLC et al

Filing 117

(IN CHAMBERS) Order Re: Motion for Reconsideration and Remand (DE 113 by Judge R. Gary Klausner: The Court DENIES Plaintiff's Motion for Reconsideration and Remand. (ah)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.

CV 12-5291-RGK (RZx)

Title

Michael Chavez v. Time Warner Cable LLC et al.

Present: The
Honorable

Date

April 20, 2016

R. GARY KLAUSNER, U.S. DISTRICT JUDGE

Sharon L. Williams (Not Present)

Not Reported

N/A

Deputy Clerk

Court Reporter / Recorder

Tape No.

Attorneys Present for Plaintiffs:

Attorneys Present for Defendants:

Not Present

Not Present

Proceedings:

I.

(IN CHAMBERS) Order Re: Motion for Reconsideration and Remand
(DE 113)

INTRODUCTION & PROCEDURAL HISTORY

On January 7, 2011, Michael Chavez (“Plaintiff”) filed a Class Action Complaint against Time
Warner Cable, LLC; Time Warner Entertainment Company, LP; and Time Warner Cable Shared
Services (collectively, “Defendants”) in Los Angeles County Superior Court. The Complaint alleged
wage-and-hour violations under California Labor Code. In his Complaint, Plaintiff stated his intention to
seek penalties under the Private Attorney General Act (“PAGA”) after administrative prerequisites had
been exhausted.
On April 5, 2011, Defendants removed the case to this Court, contending that jurisdiction was
proper under the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2), (“CAFA”). On April 22, 2011,
Plaintiff filed a First Amended Complaint (“FAC”) in which he omitted any claims under PAGA. Based
on this amendment, Plaintiff moved for remand, as the FAC did not meet the jurisdictional requirements
of CAFA. On June 10, 2011, this Court remanded the action to the Los Angeles County Superior Court.
On May 17, 2012, Plaintiff filed a Second Amended Complaint (“SAC”) in state court alleging
various violations of California’s wage-and-hour claims. Of particular importance, Plaintiff also
resuscitated the PAGA claims that had been previously dropped in federal court. On June 18, 2012,
Defendants once again removed the action to this Court on the basis of CAFA. This time, CAFA
jurisdiction was found, primarily due to Plaintiff’s addition of the PAGA claim.
On February 13, 2013, the Court issued an order granting Defendants’ Motion to Strike Class
Allegations and denying as moot Plaintiff’s Motion to Certify Class. As a result of the orders, Plaintiff’s
case proceeded solely as an individual action against Defendants.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.

CV 12-5291-RGK (RZx)

Title

Date

April 20, 2016

Michael Chavez v. Time Warner Cable LLC et al.

On February 20, 2013, this Court granted Defendants’ motion for summary judgment and denied
Plaintiff’s cross-motion for summary judgment. Subsequently, the Court also denied Plaintiff’s motion
seeking reconsideration of the summary judgment ruling.
Plaintiff appealed the case to the Ninth Circuit. Before reaching the merits, the Ninth Circuit
vacated this Court’s order granting summary judgment in Defendants’ favor and remanded the case for
this Court to determine whether diversity jurisdiction exists. On January 11, 2016, this Court concluded
that diversity jurisdiction exists.
Presently before the Court is Plaintiff’s Motion for Reconsideration and Remand. For the
following reasons, the Court DENIES Plaintiff’s motion.
II.

JUDICIAL STANDARD

Federal Rule of Civil Procedure 60(b) allows a party to move for reconsideration of a court’s
order for certain, enumerated reasons or for “any other reason that justifies relief.” A motion for
reconsideration should not be used to reargue or present evidence that should have been presented
previously. Marlyn Nautraceuticals, Inc. v. Mucos Pharma GmbH & Co., 571 F.3d 873, 880 (9th Cir.
2009) (citing Kona Enters, Inc. v. Estate of Bishop, 229 F.3d 887, 890 (9th Cir. 2000)). A court should
grant a motion for reconsideration only in highly unusual circumstances. Id.
Local Rule 7-18 of the Central District of California states:
A motion for reconsideration of the decision of any motion
may be made only on the grounds of (a) a material difference
in fact or law from that presented to the Court before such
decision that in the exercise of reasonable diligence could not
have been known to the party moving for reconsideration at
the time of such decision, or (b) the emergence of new
material facts or a change of law occurring after the time of
such decision, or (c) a manifest showing of a failure to
consider material facts presented to the Court before any such
decision. No motion for reconsideration shall in any manner
repeat any oral or written argument made in support of or in
opposition to the original motion.
III.

DISCUSSION

Plaintiff moves for reconsideration of this Court’s prior order finding that diversity jurisdiction
exists in this case. He argues that the Court erred by finding that: (1) diversity jurisdiction exists and (2)
Plaintiff acted in bad faith to prevent removal, thereby equitably tolling the one-year removal limit.
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.

CV 12-5291-RGK (RZx)

Title

Michael Chavez v. Time Warner Cable LLC et al.

A.

Date

April 20, 2016

Diversity Jurisdiction

Plaintiff attacks this Court’s prior order finding that diversity jurisdiction exists. He bases his
argument on the sweeping—but utterly erroneous—proposition that “it is impossible for complete
diversity to exist in a case which contains claims for PAGA penalties.” (Pl.’s Mot. For Reconsideration
1, ECF No. 113.)
This Court previously held otherwise. After explaining that PAGA penalties sought on behalf of
non-party aggrieved employees may not be aggregated to meet the jurisdictional threshold in diversity
actions, the Court held that Plaintiff’s own PAGA penalties may be combined with his other damages to
satisfy the amount in controversy. See Urbino v. Orkin Servs. of California, Inc., 726 F.3d 1118 (9th
Cir. 2013). This Court also explained that PAGA penalties attributable to the state could not be
aggregated because “[t]he State, as the real party in interest, is not a ‘citizen’ for diversity purposes.” Id.
at 1123.
Undeterred by the clear language of the case law as explained in this Court’s prior order,
Plaintiff persists and boldly proclaims, “This is the fourth time in as many months that plaintiff has
pointed out to the Court that the presence of the State of California, as a real party in interest on the
PAGA claim, destroys complete diversity.” (Pl.’s Mot. For Reconsideration 1-2, ECF No. 113)
(emphasis added). Plaintiff’s position is simply wrong as the Court explains below.
First, the Ninth Circuit remanded the instant action back to this Court to examine whether
diversity jurisdiction exists. If PAGA claims categorically destroyed diversity jurisdiction, as Plaintiff
contends, the Ninth Circuit’s mandate inquiring into the existence of diversity jurisdiction would have
been completely unnecessary, even nonsensical.
Second, the Ninth Circuit has held, “With regard to [] PAGA claims, we hold that the district
court properly exercised jurisdiction over the claims. Although California may be a real party in interest
to a PAGA action, this does not convert California into an actual party to all PAGA litigation.” Archila
v. KFC U.S. Properties, Inc., 420 F. App’x 667, 668 (9th Cir. 2011) (internal citation omitted)
(emphasis added).
Third, Plaintiff’s reliance on Mississippi ex rel. Hood v. AU Optronics Corp., 134 S. Ct. 736
(2014) is misguided. Plaintiff cites AU Optronics for the proposition that “in cases involving a State or
state official, [courts inquire] into the real party in interest because a State’s presence as a party will
destroy complete diversity.” Id. at 745. The facts and holding in AU Optronics are entirely different
from those of the instant action. In AU Optronics, the Supreme Court held that an action brought solely
by the State of Mississippi against a group of business did not constitute a “mass action” under CAFA;
therefore, the high court ultimately remanded the case because “the State of Mississippi [was] the only
named plaintiff in the [] action.” Id. at 739. It is unclear how AU Optronics governs the present case.
Here, an individual plaintiff is proceeding with a PAGA action under diversity jurisdiction; the State of
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.

CV 12-5291-RGK (RZx)

Title

Date

April 20, 2016

Michael Chavez v. Time Warner Cable LLC et al.

California is not an actual party or named plaintiff proceeding under CAFA jurisdiction. Thus, the two
cases are clearly distinguishable, and Plaintiff fails to explain how the holding of AU Optronics applies
to the instant action.
Finally, Plaintiff invokes two Ninth Circuit opinions addressing the interplay between PAGA
and CAFA—neither of which supports his blanket assertion that “district courts are forbidden to
exercise [diversity] jurisdiction . . . over cases with PAGA claims.” See Baumann v. Chase Inv. Servs.
Corp., 747 F.3d 1117 (9th Cir. 2014); Yocupicio v. PAE Grp., LLC, 795 F.3d 1057 (9th Cir. 2015). The
Baumann court did not declare that PAGA claims categorically defeated diversity, it simply held that in
the specific case before it, the plaintiff’s individual PAGA recovery did not satisfy the amount in
controversy and, therefore, diversity jurisdiction did not exist. 747 F.3d at 1124. Likewise, the
Yocupicio court did not rule that PAGA claims can never serve as the basis of diversity jurisdiction. 795
F.3d 1062. Instead, in that particular case, the Ninth Circuit found a lack of complete diversity because
both the named parties were citizens of the same state—not because, as Plaintiff posits, the presence of
California as a real party in interest defeats diversity. Id.
Accordingly, the Court rejects Plaintiff’s arguments on the issue of diversity jurisdiction.
B.

Bad Faith

Next, Plaintiff challenges this Court’s finding that he acted in bad faith to prevent removal. In its
previous order the Court found that
Plaintiff engaged in bad faith based on the timing of his
amendments. Plaintiff originally asserted PAGA claims in
state court. After the case was removed to federal court,
Plaintiff immediately deleted his PAGA claims [in the FAC]
. . . . Once back in state court, Plaintiff reasserted the same
PAGA claims one month after the one-year limit had lapsed.
This sequence of events suspiciously resembles a ploy to
evade removal by waiting out the clock. Compounding
matters further, Plaintiff failed to provide any explanation for
the suspicious timing of his amendments or the decision to
omit the PAGA claim until just after the one-year limitation
had expired. Based on these facts, the Court finds that
Plaintiff’s bad faith equitably tolls the one-year limitation,
rendering Defendants’ removal timely.
(Order re: Ninth Circuit Remand to Determine Diversity Jurisdiction 6, ECF No. 104.)
Plaintiff argues, for the first time, that he never actually included a PAGA claim in his original
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.

CV 12-5291-RGK (RZx)

Date

Title

April 20, 2016

Michael Chavez v. Time Warner Cable LLC et al.

Complaint, and, therefore, did not subsequently delete a PAGA claim in his FAC. In support of this
argument, he points to this Court’s order remanding the FAC in June 2011, stating that “the causes of
action named in the Complaint do not include an action for PAGA penalties . . . . Rather, the Complaint
announces Plaintiff’s intention to seek PAGA penalties.” (Case No. 11-2880, ECF No. 24.)
The Court rejects this contention for several reasons. First, Plaintiff did not raise this argument in
his original brief disputing diversity jurisdiction even though all the same information was available to
him at that time. (See Pl.’s Br. re: Diversity Jurisdiction, ECF No. 99.) Second, while Plaintiff may not
have formally asserted his PAGA claims in the original Complaint, he did state his intent to bring such
claims several times throughout the pleading. Upon removal, however, Plaintiff filed his FAC in which
he deleted all mention of PAGA claims. After remand, Plaintiff waited until the one-year limit had
lapsed before resurrecting his PAGA claims. Thus, even if Plaintiff merely hinted at the PAGA claims
in his Complaint, his course of conduct after the first removal still suggests a bad faith attempt to defeat
a second removal. Finally, compounding matters further, Plaintiff does not provide a reason for the
delay in bringing the PAGA claims; instead he argues that he “is under no obligation to explain to
defendants or to the Court his litigation strategy, which is protected by privilege; or to explain his
decision whether or not to bring a claim, or when he chooses to bring such claim.” (Pl.’s Mot. For
Reconsideration 1-2, ECF No. 113.)
Accordingly, the Court rejects Plaintiff’s argument on the issue of bad faith.
V.

CONCLUSION

For the foregoing reasons, the Court DENIES Plaintiff’s Motion for Reconsideration and
Remand.
IT IS SO ORDERED.
:
Initials of Preparer

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