Manuel Balian v. Home Depot U.S.A., Inc. et al

Filing 17

MINUTES (IN CHAMBERS) by Judge Beverly Reid O'Connell: ORDER RE PLAINTIFF'S MOTION TO REMAND 14 The Court concludes that Defendant properly removed this matter under 28 U.S.C. section 1332. Accordingly, the Court DENIES Plaintiffs' Motion to Remand. The hearing set for September 18, 2017, is hereby VACATED.IT IS SO ORDERED. (rfi)

LINK:
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No.

CV 17-04837-BRO (MRWx)

Title

MANUEL BALIAN V. THE HOME DEPOT U.S.A., INC.

Date

September 14, 2017

Present: The Honorable

BEVERLY REID O’CONNELL, United States District Judge

Renee A. Fisher

Not Present

N/A

Deputy Clerk

Court Reporter

Tape No.

Attorneys Present for Plaintiffs:

Attorneys Present for Defendants:

Not Present

Not Present

Proceedings:

(IN CHAMBERS)

ORDER RE PLAINTIFF’S MOTION TO REMAND [14]
I.

INTRODUCTION

Pending before the Court is Plaintiff Manuel Balian’s (“Plaintiff”) Motion to
Remand. (See Dkt. No. 14 (hereinafter, “Motion” or “Mot.”).) After considering the
papers filed in support of and in opposition to the instant Motion, the Court deems this
matter appropriate for resolution without oral argument of counsel. See Fed. R. Civ. P.
78; C.D. Cal. L.R. 7-15. For the following reasons, the Court DENIES Plaintiff’s
Motion.
II.

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiff is, and at all relevant times herein was, a resident of the County of Los
Angeles, State of California. (See Dkt. No. 1-2 (hereinafter, “Complaint” or “Compl.”)
¶ 2.) Defendant The Home Depot U.S.A., Inc. (“Home Depot”) is incorporated in the
State of Delaware and has corporate headquarters located in the State of Georgia. (See
Dkt. No. 1 (hereinafter, “Removal”) ¶ 15.) Home Depot maintains several places of
business in Los Angeles County, California. (See Compl. ¶ 3.)
The Home Depot hired Plaintiff to work at its Burbank, California location on or
around December 3, 2015. (Compl. ¶ 10.) Plaintiff alleges that his work environment
became hostile due to the appointment of a new supervisor of his freight team in early
August 2016 and that he continued to be harassed by that supervisor until Home Depot
terminated his employment on September 27, 2017. (See Compl. ¶¶ 11–22.)

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LINK:
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No.

CV 17-04837-BRO (MRWx)

Title

MANUEL BALIAN V. THE HOME DEPOT U.S.A., INC.

Date

September 14, 2017

On May 15, 2017, Plaintiff filed his Complaint in Los Angeles County Superior
Court, alleging nine causes of action: (1) discrimination in violation of California
Government Code Section 12940 et seq.; (2) harassment in violation of California
Government Code Section 12940 et seq.; (3) retaliation in violation of California
Government Code Section 12940 et seq.; (4) failure to prevent discrimination,
harassment, and retaliation in violation of California Government Code Section
12940(k); (5) retaliation for disclosing violations of law pursuant to California Labor
Code Section 98.6; (6) wrongful termination; (7) intentional infliction of emotional
distress; (8) breach of implied-in-fact agreement; and (9) unfair competition pursuant to
violation of California Business and Professions Code Section 17200, et seq. (See
Compl. at 1–2.) Plaintiff also seeks declaratory judgment that Defendant harassed,
discriminated against, and wrongfully terminated him on the basis of protected
characteristics under California Government Code Section 12920 et seq. (See Compl.
¶¶ 29–38.) Defendant filed its Notice of Removal on June 30, 2017, invoking this
Court’s diversity jurisdiction (see Removal), and filed an Answer to the Complaint on
July 7, 2017 (see Dkt. No. 8). On July 28, 2017, Plaintiff filed the instant Motion
asserting that Defendant improperly removed the case from state court due to a lack of
complete diversity. (See Mot. at 3.) Defendants filed their Opposition to Plaintiff’s
Motion to Remand on August 28, 2017. (See Dkt. No. 15 (hereinafter, “Opposition” or
“Opp’n”).) Plaintiff replied on August 31, 2017. (See Dkt. No. 16 (hereinafter,
“Reply”).)
III.

LEGAL STANDARD

Federal courts are of limited jurisdiction and possess jurisdiction only as
authorized by the Constitution or by federal statute. Kokkonen v. Guardian Life Ins. Co.
of Am., 511 U.S. 375, 377 (1994). Pursuant to 28 U.S.C. section 1332(a)(1), a federal
district court has jurisdiction over “all civil actions where the matter in controversy
exceeds the sum or value of $75,000, exclusive of interest and costs,” and the dispute is
between citizens of different states. 28 U.S.C. § 1332(a)(1). The Supreme Court has
interpreted Section 1332 to require “complete diversity of citizenship,” meaning each
plaintiff must be diverse from each defendant. Caterpillar Inc. v. Lewis, 519 U.S. 61,
67–68 (1996).

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LINK:
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No.

CV 17-04837-BRO (MRWx)

Title

MANUEL BALIAN V. THE HOME DEPOT U.S.A., INC.

Date

September 14, 2017

Under 28 U.S.C. section 1441(a), a civil action may be removed to federal court
only if the action could have been brought in federal court originally. 28 U.S.C.
§ 1441(a). This means that removal is proper only if the district court has original
jurisdiction over the issues alleged in the state court complaint. The Ninth Circuit
“strictly construe[s] the removal statute against removal jurisdiction.” Gaus v. Miles,
Inc., 980 F.2d 564, 566 (9th Cir. 1992) (citations omitted). If a district court finds that it
lacks jurisdiction at any time, the court must remand the action. See 28 U.S.C. § 1447(c).
Moreover, “[f]ederal jurisdiction must be rejected if there is any doubt as to the right of
removal in the first instance.” Gaus, 980 F.2d at 566 (citing Libhart v. Santa Monica
Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1988)). This presumption against removal
“means that the defendant always has the burden of establishing that removal is proper.”
Id. (citations omitted). “[T]he court resolves all ambiguity in favor of remand to state
court.” Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 2009) (citing Gaus,
980 F.2d at 566).
IV.

DISCUSSION
A.

Whether Complete Diversity Exists Between Plaintiff and Defendant

Plaintiff contends that removal was improper because Defendant has failed to show
complete diversity between Plaintiff and Defendant. (Mot. at 3.) As explained below,
the Court disagrees with Plaintiff.
1.

Plaintiff’s Citizenship

For diversity jurisdiction purposes, an individual’s citizenship is determined by
where the individual is domiciled. See Hunter, 582 F.3d at 1043. An individual’s
domicile is his or her permanent home, where the individual resides with the intention to
remain or to where he or she intends to return. See Lew v. Moss, 797 F.2d 747, 749–50
(9th Cir. 1986). Here, Plaintiff is and was a resident of Los Angeles County, California
during the relevant time period (see Compl. ¶ 3), and there is no evidence before the
Court that Plaintiff intends to leave the state. Moreover, Plaintiff appears to concede that
he is a California citizen. (See Mot.) Accordingly, the Court finds that Plaintiff is and
was domiciled in, and therefore a citizen of, California.

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LINK:
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No.

CV 17-04837-BRO (MRWx)

Title

MANUEL BALIAN V. THE HOME DEPOT U.S.A., INC.

Date

September 14, 2017

2.

Defendant Home Depot’s Citizenship

The citizenship of a corporation is both the state of its incorporation and the state
of its principal place of business. 28 U.S.C. § 1332(c)(1); Hertz Corp. v. Friend, 559
U.S. 77, 80 (2010). The phrase “principal place of business” refers to “the place where
the corporation maintains its headquarters—provided that the headquarters is the actual
center of direction, control, and coordination, i.e., the ‘nerve center.’” Hertz, 559 U.S. 77
at 93.
Here, Defendant provided declarations stating that Home Depot is a Delaware
corporation (see Dkt. No. 15-1 (hereinafter, “Collins-Brown Decl.”) ¶ 3.) and that it
“performs a vast majority its executive and administrative functions at its corporate
headquarters” in Fulton County, Georgia (see Dkt. No. 3 (“Conley Decl.”) ¶ 5; see also
Removal ¶ 15). Specifically, Home Depot asserts its executive offices, as well as its
“finance, accounting, purchasing, treasury, marketing, training, human resources,
information systems, internal audit, and legal functions are all centralized in its Atlanta
headquarters.” (Collins-Brown Decl. ¶ 3.) Defendant has thus adequately established its
“nerve center,” where executives control its enterprise, as its Georgia corporate
headquarters. Therefore, the Court finds that Home Depot is a citizen of Delaware, its
state of incorporation, and of Georgia, its principal place of business.
Plaintiff asserts that Home Depot is a citizen of California because California is its
“principal place of business.” (Mot. at 8–9.) Plaintiff does not dispute the location of
Home Depot’s corporate headquarters in Atlanta, Georgia, as described above. (Mot.
at 5–9.) Instead, Plaintiff relies on Tosco Corp. v. Communities for a Better
Environment, 236 F.3d 495 (9th Cir. 2001) as authority supporting that a corporation’s
principal place of business can be established by identifying a state where a “substantial
predominance” of business activity takes place. (See Mot. at 6.) According to the
Supreme Court’s holding in Hertz, the “substantial predominance” test, previously used
by the Ninth Circuit as a way to determine a corporation’s principal place of business, is
no longer valid. See Hertz, 559 U.S. 77 at 92 (nullifying divergent statutory
interpretations by federal circuit courts and exclusively adopting the “nerve center” test
for determining the singular principal place of business of a corporation). The Court
therefore rejects Plaintiff’s argument.

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LINK:
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No.

CV 17-04837-BRO (MRWx)

Title

MANUEL BALIAN V. THE HOME DEPOT U.S.A., INC.

Date

September 14, 2017

Accordingly, the Court finds that based on the facts presented in this case, Home
Depot is a citizen only of the States of Delaware and Georgia, not California, for the
purpose of 28 U.S.C. Section 1332.
Plaintiff is therefore a citizen of a different state than Defendant, and the Court
finds that the complete diversity of citizenship requirement is satisfied.
B.

Whether the Amount in Controversy is Sufficient

In order for removal to be proper, Defendant must also establish that the amount in
controversy exceeds $75,000. Defendant provided support of this requirement in its
removal petition (see Removal ¶¶ 19–21) and Plaintiff does not challenge removal on
these grounds in its Motion (see Mot.).
“[I]n cases where a plaintiff's state court complaint does not specify a particular
amount of damages, the removing defendant bears the burden of establishing, by a
preponderance of the evidence, that the amount in controversy exceeds [the jurisdictional
amount].” Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996). A
“preponderance of the evidence” standard requires that the defendant establish that it is
more likely than not that the amount in controversy exceeds the jurisdictional
requirement, exclusive of costs and interest. See id.
When considering whether the Defendant’s burden is met upon removal, a court
“may consider facts in the removal petition.” Singer v. State Farm Mut. Auto. Ins. Co.,
116 F.3d 373, 377 (9th Cir. 1997). Additionally, “[a] settlement letter is relevant
evidence of the amount in controversy if it appears to reflect a reasonable estimate of the
plaintiff’s claim.” Cohn v. Petsmart, Inc., 281 F.3d 837, 840 (9th Cir. 2002). Where a
plaintiff does not “disavow his letter or offer contrary evidence,” the letter may be taken
as “sufficient to establish the amount in controversy.” Id.
Here, the amount of damages sought was not specified in Plaintiff’s Complaint.
Defendant cites in its Removal papers a settlement letter from Plaintiff’s counsel dated
February 3, 2017 to establish that the amount in controversy exceeds $75,000. (See
Removal ¶ 20, Ex. I.) Specifically, Defendant points to Plaintiff’s opening demand of
$110,000 to settle all claims as “an honest estimate of Plaintiff’s claims” based on the
calculation of lost wages alleged in the letter. (See Removal ¶ 20, Ex. I.) In addition to
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LINK:
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No.

CV 17-04837-BRO (MRWx)

Title

MANUEL BALIAN V. THE HOME DEPOT U.S.A., INC.

Date

September 14, 2017

Plaintiff’s calculation of lost wages in the settlement letter, Plaintiff also claims damages
related to emotional distress. (See Compl. at 22.)
Plaintiff does not discuss the amount in controversy in its Motion (see Mot.), but
argues in response to Defendant’s Opposition that Defendant has not met their burden
because a settlement letter is not admissible evidence of the amount in controversy
pursuant to Federal Rule of Evidence 408(a). (See Reply at 5.) Like the settlement
demand in Cohn, here “Rule 408 is inapplicable because [the settlement letter] was not
offered to establish the amount of [Defendant’s] liability,” but only to indicate Plaintiff’s
assessment of the value of its lost wages. Cohn, 281 F.3d 837 at n.3.
Plaintiff has not specifically contended, nor presented evidence to the Court which
disputes, that the actual amount of damages Plaintiff seeks is less than the amount
represented in Plaintiff’s settlement demand. The preponderance of the evidence before
the Court thus supports an amount in controversy of more than $75,000. See Sanchez,
102 F.3d at 404. Therefore, the Court finds the amount in controversy requirement for
removal is also satisfied.
In conclusion, the Court finds that because there is complete diversity of
citizenship and the amount in controversy exceeds $75,000, this Court has subject matter
jurisdiction under 28 U.S.C. section 1332.
C.

Requests for Fees and Sanctions

Plaintiff has requested that the Court award him attorney’s fees and costs incurred
in bringing this Motion pursuant to 28 U.S.C. Section 1447(c). Based on the Court’s
conclusion that removal was proper this request is denied.
In its Opposition, Defendant contends that Plaintiff’s counsel’s arguments in its
Motion are frivolous and warrant monetary sanctions under Rule 11 of the Federal Rules
of Civil Procedure.1 Rule 11 requires that a request for sanctions be “made separately

1

Defendant asserts Plaintiff’s Motion is frivolous because its arguments relied on the abrogated
“substantial predominance” test for a corporation’s principal place of business. (Opp’n at 5.) Notably,
in its Removal papers, Defendant refers to the same abrogated standard to articulate an alternative basis
for finding their principal place of business as their corporate headquarters. (See Removal ¶ 16 (stating
that because “Home Depot does not perform a ‘substantial predominance’ of corporate operations in
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LINK:
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No.

CV 17-04837-BRO (MRWx)

Title

MANUEL BALIAN V. THE HOME DEPOT U.S.A., INC.

Date

September 14, 2017

from other motions or requests.” Fed. R. Civ .P. 11(c)(1)(A); Arellano v. Home Depot
U.S.A., Inc., 245 F. Supp. 2d 1102, 1109 (S.D. Cal. 2003).2 Here, Defendant’s request
for sanctions is instead included in their Opposition. (See Opp’n at 5.) Though
formulating their request as at the mercy of the Court’s own initiative and discretion
under Rule 11(c)(3) to order the Plaintiff to show cause why sanctions are improper, it is
in essence a request for sanctions, and as such, is procedurally inappropriate.
Accordingly, Defendant’s request for sanctions is denied, though Defendant has the
opportunity to place a properly noticed motion for Rule 11 sanctions before the Court.
V.

CONCLUSION

For the foregoing reasons, the Court concludes that Defendant properly removed
this matter under 28 U.S.C. section 1332. Accordingly, the Court DENIES Plaintiffs’
Motion to Remand. The hearing set for September 18, 2017, is hereby VACATED.
:

IT IS SO ORDERED.
Initials of Preparer

rf

any single state,” its “principal place of business is the state in which the corporation performs its
executive and administrative functions”) (emphasis added).)
2

Home Depot also cites Arellano in its Removal, which as shown above, clearly and explicitly states the
proper procedure for requesting Rule 11 sanctions. (See Removal ¶ 15.)

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