Felicia Enriquez v. Stericycle, Inc. et al

Filing 10

MINUTES (IN CHAMBERS) - ORDER TO SHOW CAUSE WHY THIS ACTION SHOULD NOT BE REMANDED TO STATE COURT FOR LACK OF SUBJECT MATTER JURISDICTION by Judge Dolly M. Gee. Stericycle is hereby ORDERED TO SHOW CAUSE ("OSC") why this action should not be remanded to Los Angeles County Superior Court for lack of subject matter jurisdiction. Stericycle shall file its response by no later than October 12, 2016. Plaintiff may file a reply by no later than October 19, 2016. (iv)

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

Date

CV 16-6964 DMG (JEMx)

Title Felicia Enriquez v. Stericycle, Inc., et al.
Present: The Honorable

October 5, 2016
Page

1 of 2

DOLLY M. GEE, UNITED STATES DISTRICT JUDGE

KANE TIEN
Deputy Clerk

NOT REPORTED
Court Reporter

Attorneys Present for Plaintiff(s)
None Present

Attorneys Present for Defendant(s)
None Present

Proceedings: IN CHAMBERS - ORDER TO SHOW CAUSE WHY THIS ACTION
SHOULD NOT BE REMANDED TO STATE COURT FOR LACK OF
SUBJECT MATTER JURISDICTION
On August 12, 2016, Plaintiff Felicia Enriquez filed a complaint against Defendants
Stericycle, Inc. and David Steele in the Los Angeles County Superior Court. (“Notice of
Removal”) ¶ 1 [Doc. # 1.] On September 16, 2016, Stericycle removed the case to this Court on
the basis of diversity of citizenship pursuant to 28 U.S.C. § 1332(a). Id. at 1.
Diversity jurisdiction under 28 U.S.C. § 1332 requires that the parties to the suit are of
diverse citizenship. Diaz v. Davis (In re Digimarc Corp. Derivative Litig.), 549 F.3d 1223, 1234
(9th Cir. 2008) (citing Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267 (1806)) (“Diversity
jurisdiction requires complete diversity between the parties—each defendant must be a citizen of
a different state from each plaintiff.”). “The burden of establishing federal subject matter
jurisdiction falls on the party invoking removal.” Marin Gen. Hosp. v. Modesto & Empire
Traction Co., 581 F.3d 941, 944 (9th Cir. 2009) (citing Toumajian v. Frailey, 135 F.3d 648, 652
(9th Cir. 1998)). There is a “strong presumption against removal jurisdiction,” and courts must
reject it “if there is any doubt as to the right of removal in the first instance.” Geographic
Expeditions, Inc. v. Estate of Lhotka ex rel. Lhotka, 599 F.3d 1102, 1107 (9th Cir. 2010) (quoting
Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (per curiam) (internal quotation marks
omitted)).
Stericycle argues that Defendant Steele must be disregarded for purposes of diversity
because he is a “sham” defendant. Notice of Removal ¶¶ 9-16. “It is a commonplace that
fraudulently joined defendants will not defeat removal on diversity grounds.” Ritchey v. Upjohn
Drug Co., 139 F.3d 1313, 1318 (9th Cir. 1998). “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.’” Morris v. Princess Cruises, Inc.,

CV-90

CIVIL MINUTES—GENERAL

Initials of Deputy Clerk KT

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

CV 16-6964 DMG (JEMx)

Title Felicia Enriquez v. Stericycle, Inc., et al.

Date

October 5, 2016
Page

2 of 2

236 F.3d 1061, 1067 (9th Cir. 2001) (quoting McCabe v. General Foods Corp., 811 F.2d 1336,
1339 (9th Cir. 1987)).
According to Stericycle, because Steele—Plaintiff’s supervisor—is not considered an
“employer” for the purposes of California Labor Code sections 1198.5 and 226(b), Plaintiff’s
causes of action under those sections against Steele fail as a matter of law. Notice of Removal ¶¶
14-15. Additionally, Stericycle asserts that because Plaintiff did not identify allegations against
Steele in her administrative complaint against Stericycle, she cannot allege a valid harassment
claim against Steele under FEHA. Id. ¶¶ 11-13.
A defendant, however, must show that “there is no possibility that the plaintiff could
prevail on any cause of action it brought against the non-diverse defendant.” Padilla v. AT&T
Corp., 697 F. Supp. 2d 1156, 1159 (C.D. Cal. 2009) (internal citations omitted; emphasis added).
Further, “[r]emand must be granted unless the defendant shows that the plaintiff would not be
afforded leave to amend his complaint to cure the purported deficiency.” Id. “Fraudulent
joinder must be proven by clear and convincing evidence,” and “there is a general presumption
against fraudulent joinder.” Hamilton Materials, Inc. v. Dow Chem. Corp., 494 F.3d 1203, 1206
(9th Cir. 2007). Here, it does not appear that Stericycle has established that Steele is a sham
defendant.
Stericycle is hereby ORDERED TO SHOW CAUSE (“OSC”) why this action should
not be remanded to Los Angeles County Superior Court for lack of subject matter jurisdiction.
Stericycle shall file its response by no later than October 12, 2016. Plaintiff may file a reply by
no later than October 19, 2016.
IT IS SO ORDERED.

CV-90

CIVIL MINUTES—GENERAL

Initials of Deputy Clerk KT