Randolph Lomeli v. HD Supply, Inc. et al

Filing 19

MINUTES (IN CHAMBERS) by Judge S. James Otero: ORDER GRANTING PLAINTIFF'S MOTION TO REMAND 9 ; DENYING AS MOOT DEFENDANT'S MOTION TO DISMISS 10 . Case to State Court Case Remanded to Los Angeles Superiior Court, No. BC590214. ( MD JS-6. Case Terminated ) (lc)

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL

CASE NO.: CV 16-01075 SJO (PLAx)
TITLE:

DATE: April 29, 2016

Lomeli v. HD Supply, Inc. et al.

========================================================================
PRESENT: THE HONORABLE S. JAMES OTERO, UNITED STATES DISTRICT JUDGE
Victor Paul Cruz
Courtroom Clerk

Not Present
Court Reporter

COUNSEL PRESENT FOR PLAINTIFF:

COUNSEL PRESENT FOR DEFENDANTS:

Not Present

Not Present

========================================================================
PROCEEDINGS (in chambers): ORDER GRANTING PLAINTIFF'S MOTION TO REMAND
[Docket No. 9]; DENYING AS MOOT DEFENDANT'S MOTION TO DISMISS [Docket No. 10]
This matter is before the Court on (1) Plaintiff Randolph Lomeli's ("Plaintiff") Motion for Remand
("Lomeli Motion"), filed March 29, 2016; and (2) Defendant Jim Schneider's ("Schneider") Motion
to Dismiss Plaintiff's Complaint ("Schneider Motion"), filed April 1, 2016. Plaintiff opposed the
Motion to Dismiss ("Schneider Opposition") on April 6, 2016, replied to the Lomeli Motion on April
22, 2016. Schneider did not oppose the Lomeli Motion, but replied to the Motion to Dismiss on
April 25, 2016. The Court found these matters suitable for disposition without oral argument and
vacated the hearings set for May 2, 2016. See Fed. R. Civ. P. 78(b). For the following reasons,
the Court GRANTS the Lomeli Motion and DENIES AS MOOT the Schneider Motion.
I.

FACTUAL AND PROCEDURAL BACKGROUND

This employment dispute presents the parties' second trip to the federal court system, after
Schneider and co-defendant HD Supply, Inc.'s ("HD Supply") first removal attempt in Lomeli v. HD
Supply, Inc. et al., No. CV 15-07759 SJO (SHx) (C.D. Cal.) ("First Removal Action") was rebuffed.
See Order Granting Pl.'s Am. Mot. to Remand, First Removal Action (Nov. 6, 2015), ECF No. 19
("First Remand Order"). In the First Remand Order, the Court remanded in light of HD Supply's
inability to demonstrate that the amount in controversy exceeds $75,000, as required by 28 U.S.C.
section 1332 ("Section 1332"). See generally First Remand Order.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL

CASE NO.: CV 16-01075 SJO (PLAx)

DATE: April 29, 2016

Plaintiff's state court complaint ("Complaint") against Defendants1 was filed in Los Angeles
Superior Court on August 3, 2015 in a case captioned Lomeli v. HD Supply, Inc., et al., No.
BC590214 (Cal. Super. Ct. Aug. 3, 2015) ("State Court Action"). (See Decl. Sarina Saluja in Supp.
Notice and Pet. for Removal of Action ("Saluja Decl."), Ex. A ("Compl."), ECF No. 1.) Plaintiff
amended his complaint ("FAC") on January 28, 2016 solely to add HD Supply Management, Inc.
("HDSM") as one of the fictitious defendants (together with HD Supply and Schneider,
"Defendants"). (See Saluja Decl., Ex. E.)
On January 15, 2016, counsel for Defendants received Plaintiff's Case Management Conference
("CMC") Statement in the State Court Action. (Saluja Decl., Ex. J ("CMC Statement").) In the
CMC Statement, Plaintiff alleges that he is seeking damages in excess of $245,000. (CMC
Statement ¶ 4(b).)
On February 10, 2016, counsel for Defendants received an email from Plaintiff's counsel regarding
whether their firm was authorized to accept service on behalf of Schneider. (See Saluja Decl., Ex.
H.) The same day, counsel for Defendants informed Plaintiff's counsel to send her a notice of
acknowledgment of receipt for service of the FAC for Schneider. (Saluja Decl., Ex. H.) Counsel
for Defendants had not received such acknowledgment as of the date they removed the State
Court Action. (Saluja Decl. ¶ 9.)
Plaintiff alleges the following in his Complaint. Plaintiff resides in the state of California. (Compl.
¶ 1.) HD Supply, Inc. is a business entity authorized to do business in, and conduct business in,
Los Angeles County. (Compl. ¶ 2.) Schneider "was, and now is, an individual residing in the
County of Los Angeles, State of California, and was a Owner, Officer, Shareholder, Director,
Manager, Supervisor, Lead, Managing Agent and employee of Defendants . . ." (Compl. ¶ 3.)
For approximately two-and-a-half years, Plaintiff was employed as a driver by HD Supply. (Compl.
¶ 6.) In April or May of 2012, Plaintiff developed physical disabilities including foot injuries, tendon
injuries, and associated conditions. (Compl. ¶ 7.) Plaintiff kept Defendants informed of his
disability at all relevant times, and made a Worker's Compensation claim. (Compl. ¶¶ 8-9.)
Plaintiff "was entitled to and/or requested and/or was granted, full and/or intermittent CFRA and/or
other medical and/or other negotiated leave in order to recuperate and heal, from September 2013
onwards." (Compl. ¶ 10.) In or around December 2013, Plaintiff underwent foot surgery. (Compl.
¶ 11.) Plaintiff returned to work on April 7, 2014. (Compl. ¶ 12.)

1

Although Plaintiff has named "Jim Snyder" as a defendant in both the instant action and
the First Removal Action, Plaintiff does not dispute Defendants' averment that the individual
defendant's actual name is "Jim Schneider." (See, e.g., Lomeli Mot. 3, ECF No. 9.)
Although it is immaterial for purposes of the instant Motion, the Court refers to the individual
defendant as "Schneider."
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
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CASE NO.: CV 16-01075 SJO (PLAx)

DATE: April 29, 2016

Upon returning to work, "each of" the Defendants harassed, discriminated against, and retaliated
against Plaintiff by, among other things, cutting Plaintiff's work hours and routes and assigning
Plaintiff, who is short, the largest trucks. (Compl. ¶ 13.) In particular, Schneider "slapped papers
out of Plaintiff's hands, knocked his boxes over and called him 'shorty' on a daily basis." (Compl.
¶ 13.) Plaintiff complained about and protested these actions to superiors, to no avail. (Compl.
¶ 14.) On or about August 15, 2014, one of Plaintiff's supervisors informed Plaintiff that he was
terminated because he had missed a lunch break the prior week, even though Plaintiff explained
that he had been scheduled to start at a different hour, which had shifted the lunch break period.
(Compl. ¶ 15.)
Plaintiff asserts the following causes of action against Defendants: (1) violation of California
Government Code section 12940 et seq. ("FEHA") due to unlawful employment practices; (2)
violation of California Government Code section 12945.2 (the "California Family Rights Act" or
"CFRA") by failing to give Plaintiff an opportunity to return to work and refusing to allow Plaintiff
to retain Plaintiff's employee status; (3) retaliation and wrongful termination in violation of
California Government Code section 12940 et seq., California Labor Code section 132a, and
California Civil Code section 3333; and (4) declaratory relief. (See generally Compl.)
The instant action was removed to this Court on February 16, 2016. (See Notice and Pet. for
Removal of Action, ECF No. 1.)
II.

DISCUSSION

Although two motions are pending before the Court, several of the legal issues contained therein
are integrally related.
In the Lomeli Motion, Plaintiff offers five reasons why the instant action should be remanded to
state court. First, Plaintiff contends that Schneider, who allegedly has been served with the
Complaint, has not joined HD Supply in the Notice of Removal, rendering removal improper
pursuant to 28 U.S.C. section 1446(b)(2)(A). (Lomeli Mot. 3, ECF No. 9.) Second, Schneider,
who is not diverse from Plaintiff, was not fraudulently joined because management personnel can
be held liable under California Government Code section 12940 for harassment of an employee.
(Lomeli Mot. 5.) Third, removal is untimely because HD Supply did not remove the State Court
Action within thirty days of the Case Management Conference. (Lomeli Mot. 10.) Fourth,
Defendants cannot prove, based on a single statement made during the Case Management
Conference, that the amount in controversy exceeds $75,000, defeating diversity jurisdiction.
(Lomeli Mot. 12.) Finally, HD Supply Management, Inc. ("HDSM") is not Plaintiff's employer, and

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UNITED STATES DISTRICT COURT
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CIVIL MINUTES - GENERAL

CASE NO.: CV 16-01075 SJO (PLAx)

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HD Supply's attempt to name HDSM as an additional defendant for the purpose of effecting
removal a second time is a sham. (Lomeli Mot. 14.)2
In the Schneider Motion, Defendants contend that Schenider must be dismissed as a defendant
in the instant. (See generally Schneider Mot., ECF No. 10.) First, Defendants argue that there
is no individual liability for discrimination, retaliation, violation of CFRA, or wrongful termination
claims, warranting dismissal of these claims. (Schneider Mot. 4-5.) Defendants further contend
that, with respect to the harassment claim, Plaintiff fails to state sufficient facts that Schneider's
conduct was clearly based on Plaintiff's disability or was sufficiently "severe" or "pervasive" so as
to alter the conditions of Plaintiff's employment. (Schneider Mot. 6-8.) Defendants also argue that
Plaintiff's declaratory relief claim fails as to Schneider because all of the other causes of action fail.
(Schneider Mot. 9.)
A.

Legal Standards
1.

Diversity Jurisdiction: Amount-In-Controversy and Fraudulent Joinder

A district court has removal jurisdiction pursuant to 28 U.S.C. section 1332 "where the matter in
controversy exceeds the sum of $75,000, exclusive of interest and costs, and is between . . .
citizens of different States." 28 U.S.C. § 1332(a)(1). "Jurisdictional facts are assessed on the
basis of Plaintiff's complaint at the time of removal." Simmons v. PCR Tech., 209 F. Supp. 2d
1029, 1032 (N.D. Cal. 2002) (citing 28 U.S.C. § 1441). "[W]here it is unclear or ambiguous from
the face of a state-court complaint whether the requisite amount in controversy is pled," the
removing defendant "bears the burden of establishing, by a preponderance of the evidence, that
the amount in controversy exceeds [the jurisdictional amount]." Guglielmino v. McKee Foods
Corp., 506 F.3d 696, 699 (9th Cir. 2007); Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404
(9th Cir. 1996). General allegations that the amount in controversy exceeds $75,000 does not
satisfy this burden. See Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1117 (9th Cir. 2004).
Although federal law requires complete diversity of citizenship, one exception to this requirement
is where a non-diverse defendant has been "fraudulently joined." Morris v. Princess Cruises, Inc.,
236 F.3d 1061, 1067 (9th Cir. 2001). "Joinder of a non-diverse defendant is deemed fraudulent,
and the defendant's presence in the lawsuit is ignored for purposes of determining diversity, '[i]f
the plaintiff fails to state a cause of action against a resident defendant, and the failure is obvious
according to the settled rules of the state." Id. at 1067 (citing McCabe v. General Foods Corp.,
811 F.2d 1336, 1339 (9th Cir. 1987)).

2

Plaintiff also contends that, should Plaintiff succeed in its Motion, the Court should award
it attorneys' fees and costs incurred in composing the Motion. (Mot. 15.)
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CASE NO.: CV 16-01075 SJO (PLAx)

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A defendant cannot successfully prove fraudulent joinder by arguing either that a plaintiff will not
prevail against the non-diverse defendant or that a plaintiff has not sufficiently alleged a claim
against that defendant. See Munoz v. Lab. Corp. of America, No. CV 15-902-GW, 2015 WL
4507104 (C.D. Cal. July 23, 2015). Instead, a defendant must provide "clear and convincing
evidence" that a plaintiff cannot succeed against the non-diverse defendant. Hamilton Materials,
Inc. v. Dow Chem. Corp., 494 F.3d 1203, 1206 (9th Cir. 2007). "Even where presently deficiently
pled, where Plaintiffs may amend that claim to cure any arguable defects, it may not be said that
it is impossible for them to state a claim against [a non-diverse defendant]." Munoz, 2015 WL
4507104, at *1.
"If at any time before final judgment it appears that the district court lacks subject matter
jurisdiction, the case shall be remanded." 28 U.S.C. § 1447(c). Courts sitting in the Ninth Circuit
"strictly construe the removal statute against removal jurisdiction." Gaus v. Miles, Inc., 980 F.2d
564, 566 (9th Cir. 1992) (citing Boggs v. Lewis, 863 F.2d 662, 663 (9th Cir. 1988). "Federal
Jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance."
Id. (citing Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1979)). "The 'strong
presumption' against removal jurisdiction means that the defendant always has the burden of
establishing that removal is proper." Id. (citing Nishimoto v. Federman-Bacharach & Assocs., 903
F.2d 709, 712 n. 3 (9th Cir. 1990)).
2.

Rule 12(b)(6): Failure to State a Claim

Federal Rule of Civil Procedure 12(b)(6) ("Rule 12"), which provides for dismissal of a plaintiff's
cause of action for "failure to state a claim on which relief can be granted," see Fed. R. Civ. P.
12(b)(6), must be read in conjunction with Federal Rule of Civil Procedure 8(a) ("Rule 8"). See
Ileto v. Glock Inc., 349 F.3d 1191, 1199-1200 (9th Cir. 2003). Rule 8 requires that "[a] pleading
that states a claim for relief must contain . . . a short and plain statement of the claim showing that
the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). Although the pleader is not required to
plead "detailed factual allegations" under Rule 8, this standard demands "more than a sheer
possibility that a defendant has acted unlawfully." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(citation omitted). Pleadings that contain nothing more than legal conclusions or "a formulaic
recitation of the elements of a cause of action" are insufficient. Id. (citation and quotation marks
omitted). "To survive a motion to dismiss, a complaint must contain sufficient factual matter,
accepted as true, to 'state a claim to relief that is plausible on its face.'" Id. (quoting Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 570 (2007)). Where a complaint pleads sufficient facts "to raise a right
to relief above the speculative level," a court may not dismiss the complaint under Rule 12(b)(6).
See Twombly, 550 U.S. at 545. In reviewing a motion to dismiss under Rule 12, a court may only
consider the complaint, documents incorporated by reference in the complaint, and matters of
judicial notice. United States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003).
As a general rule, leave to amend a complaint which has been dismissed should be freely granted.
Fed. R. Civ. P. 15(a). However, leave to amend may be denied when "the court determines that
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CASE NO.: CV 16-01075 SJO (PLAx)

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the allegation of other facts consistent with the challenged pleading could not possibly cure the
deficiency." Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir.
1986).
B.

Analysis
1.

Defendants Have Established the Amount in Controversy Exceeds $75,000

Unlike in the First Removal Action, Defendants have come prepared with documentation
corroborating the amount-in-controversy requirement. In the CMC Statement, Plaintiff submitted
to the state court that it is seeking (1) at least $100,000.00 in loss of earnings; (2) at least
$100,000.00 in future loss of earnings; (3) $20,000.00 in general damages; and (4)
$25,000,000.00 in punitive damages. (See CMC Statement ¶ 4(b).) This amount far exceeds the
$75,000.00 threshold provided in Section 1332(a). Moreover, the Court treats the CMC Statement
as "other paper" within the meaning of Section 1446(b)(3), see 28 U.S.C. § 1446(c)(3)(A), and
accordingly considers the statements made therein when ruling on the instant motion to remand,
see Olonzo v. Wells Fargo Bank, N.A., No. CV 09-6611 PSG (RCx), 2010 WL 330245, at *3 (C.D.
Cal. Jan. 21, 2010) (holding that a "Case Management Statement" constitutes "other paper," and
that it is "proper to consider the assertions made in that Statement in determining whether removal
here is proper"); see also Riggs v. Continental Banking Co., 678 F. Supp. 236, 238 (N.D. Cal.
1988) (finding that plaintiff's deposition testimony constituted "other paper"). Plaintiff's
protestations that other evidence elicited during discovery "is the best evidence to prove by a
preponderance the amount in controversy" does not alter the fact that Plaintiff himself admitted
that he is seeking well beyond $75,000 in monetary relief, particularly where Plaintiff has not
proffered any such allegedly contradictory statements made or obtained during the course of
discovery.
Accordingly, the Court DENIES the Lomeli Motion on the issue of whether the amount-incontroversy requirement is satisfied.
2.

Although Plaintiff Has Failed to State a Claim Against Schneider, Because
Plaintiff Can Amend His First Cause of Action for Harassment, the Court
Must Remand

Plaintiff in his Complaint asserts three substantive causes of action against Schneider: (1)
harassment, discrimination, and retaliation in violation of FEHA; (2) violation of CFRA; and (3)
retaliation and wrongful termination in violation of public policy. Although the Court finds that
Schneider has provided "clear and convincing evidence" that Plaintiff cannot succeed in his

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UNITED STATES DISTRICT COURT
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CASE NO.: CV 16-01075 SJO (PLAx)

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discrimination and retaliation claims against Schneider,3 see Hamilton Materials, 494 F.3d at 1206,
because "it may not be said that it is impossible" for Plaintiff to state a cause of action for
harassment in violation of FEHA against Schneider, Munoz, 2015 WL 4507104, at *1, the Court
must remand the instant action.
"To establish a claim for harassment [under FEHA], a plaintiff must demonstrate that: (1) she is
a member of a protected group; (2) she was subjected to harassment because she belonged to
this group; and (3) the alleged harassment was so severe that it created a hostile work
environment." Lawler v. Montblanc N. Am., LLC, 704 F.3d 1235, 1344 (9th Cir. 2013) (quoting
Aguilar v. Avis Rent A Car Sys., Inc., 21 Cal. 4th 121 (1999)). California courts require that the
harassment complained of must be "sufficiently pervasive so as to alter the conditions of
employment and create an abusive working environment . . . ." Fisher v. San Pedro Peninsula
Hospital, 214 Cal. App. 3d 590, 608 (1989). Thus, "harassment cannot be occasional, isolated,
sporadic, or trivial[;] rather the plaintiff must show a concerted pattern of harassment of a
repeated, routine or a generalized nature." Id. at 610. It follows that "simple teasing, offhand
comments, and isolated incidents (unless extremely serious) will not amount to discriminatory
changes in the ‘terms and conditions of employment." Faragher v. City of Boca Raton, 524 U.S.
775, 788 (1998) (internal citation omitted).
Here, the sole allegations in Plaintiff's Complaint that concern Schneider are that he "slapped
papers out of Plaintiff's hands, knocked his boxes over and called him 'shorty' on a daily basis."
(Compl. ¶ 13.) Although Plaintiff alleges only two isolated incidents of physical abuse, such
conduct, when coupled with allegations that Schneider verbally harassed Plaintiff "on a daily basis"
might be sufficient to state a claim for harassment in violation of FEHA. Unlike in Manatt v. Bank
of America, NA, 339 F.3d 792, 799 (9th Cir. 2003), a case decided on summary judgment in which
the plaintiff's coworkers directed racially insensitive "humor" at the plaintiff "on only a couple of
occasions" over a two-and-a-half year period, Plaintiff alleges that Schneider verbally abused him
"on a daily basis," and even committed two acts of physical aggression. Indeed, the Ninth Circuit
3

In Reno v. Baird, the California Supreme Court held that although the employer may be
liable for unlawful discrimination, individuals working for the employer, including
supervisors, are not personally liable for that discrimination. 18 Cal. 4th 640, 76 Cal. Rptr.
2d 499 (1998). Ten years later, the California Supreme Court in Jones v. Lodge at Torrey
Pines Partnership held that although "the employer is liable for retaliation under section
12940, subdivision (h), . . . nonemployer individuals are not personally liable for their role
in that retaliation." 42 Cal. 4th 1158, 1174, 72 Cal. Rptr. 3d 624, 637 (2008). Nor is there
individual liability for retaliation in violation of public policy or retaliation for taking leave
under the CFRA. See Nazir v. United Airlines, Inc., 178 Cal. App. 4th 243, 287, 100 Cal.
Rptr. 3d 296, 333 (1st Dist. 2009) (citing Jones, 42 Cal. 4th at 1173). Thus, Schneider
cannot, as a matter of law, be held liable under FEHA's discrimination or retaliation prongs,
CFRA's anti-retaliation provision, or for retaliation in violation of public policy.
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CASE NO.: CV 16-01075 SJO (PLAx)

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in Manatt noted that if the defendants' racially insensitive gestures "had occurred repeatedly,
[Plaintiff] may very well have had an actionable hostile environment claim." Id. (citation omitted).
Accepting these allegations as true—as the Court must when ruling on Schneider's motion to
dismiss and Plaintiff's motion to remand—the Court does not find that Plaintiff has failed to stated
a claim for harassment in violation of FEHA. See Brooks v. City of San Mateo, 229 F.3d 917, 926
(9th Cir. 2000) (noting that "the required showing of severity or seriousness of the harassing
conduct varies inversely with the pervasiveness or frequency of the conduct"). Indeed, even if the
Court were to find Plaintiff's allegations deficient, the Court cannot say that Plaintiff cannot
succeed against Schneider as to this claim, for Plaintiff could "amend [his] claim to cure any
arguable defects." Munoz, 2015 WL 4507104, at *2.
Accordingly, Defendants have not proved by "clear and convincing" evidence that Schneider was
fraudulently joined, and the Court therefore GRANTS IN PART the Lomeli Motion.4 Because there
is not complete diversity between the parties, this Court REMANDS this matter to the Superior
Court of the State of California in and for the County of Los Angeles.
III.

RULING

For the foregoing reasons, the Court GRANTS Plaintiff Randolph Lomeli's Motion for Remand and
DENIES AS MOOT Defendant Jim Schneider's Motion to Dismiss Plaintiff's Complaint. This
matter is hereby REMANDED to the Superior Court of the State of California in and for the County
of Los Angeles. Because this is the second time the Court has remanded this matter, the Court
remands with instructions not to attempt removal for a third time.
IT IS SO ORDERED.

4

Because the Court concludes that it lacks subject-matter jurisdiction over the instant
action, it need not consider the remainder of Plaintiff's arguments contained in the Lomeli
Motion. Moreover, because the Court remands this action, it DENIES AS MOOT the
Schneider Motion.
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