Child and Marton LLP v. Sentinel Insurance Company, Limited et al

Filing 19

MINUTES (IN CHAMBERS) ORDER REMANDING ACTION by Judge Fernando M. Olguin. The above-captioned action shall be remanded to the Superior Court of the State of California for the County of Los Angeles, for lack of subject matter jurisdiction pursuant to 28 U.S.C 1447(c). MD JS-6. Case Terminated. (iv)

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

CV 20-9811 FMO (JEMx)

Title

Child & Marton LLP v. Sentinel Insurance Company, Limited, et al.

Present: The Honorable

Date

November 18, 2020

Fernando M. Olguin, United States District Judge

Vanessa Figueroa

None

None

Deputy Clerk

Court Reporter / Recorder

Tape No.

Attorney Present for Plaintiff:

Attorney Present for Defendant:

None Present

None Present

Proceedings:

(In Chambers) Order Remanding Action

On September 2, 2020, plaintiff Child & Marton LLP (“plaintiff”) filed a Complaint in the Los
Angeles County Superior Court against Sentinel Insurance Company, Limited and Hartford
Financial Services Group, Inc. (“defendants”) asserting claims relating to an insurance coverage
dispute. (See Dkt. 1, Notice of Removal (“NOR”) at 1, 4); (Dkt. 1-1, Complaint). On November
12, 2020, defendants removed that action on diversity jurisdiction grounds pursuant to 28 U.S.C.
§ 1332(a). (See Dkt. 1, NOR at 5). Having reviewed the pleadings, the court hereby remands this
action to state court for lack of subject matter jurisdiction. See 28 U.S.C. § 1447(c).
“Federal courts are courts of limited jurisdiction. They possess only that power authorized
by Constitution and statute[.]” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377, 114
S.Ct. 1673, 1675 (1994). The courts are presumed to lack jurisdiction unless the contrary appears
affirmatively from the record. See DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 342 n. 3, 126
S.Ct. 1854, 1861 n. 3 (2006). Federal courts have a duty to examine jurisdiction sua sponte
before proceeding to the merits of a case, see Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574,
583, 119 S.Ct. 1563, 1569 (1999), “even in the absence of a challenge from any party.” Arbaugh
v. Y&H Corp., 546 U.S. 500, 514, 126 S.Ct. 1235, 1244 (2006).
“Under the plain terms of § 1441(a), in order properly to remove [an] action pursuant to that
provision, [the removing defendant] must demonstrate that original subject-matter jurisdiction lies
in the federal courts.” Syngenta Crop Prot., Inc. v. Henson, 537 U.S. 28, 33, 123 S.Ct. 366, 370
(2002); Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 684 (9th Cir. 2006) (per curiam)
(noting the “longstanding, near-canonical rule that the burden on removal rests with the removing
defendant”); Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (“The strong presumption
against removal jurisdiction means that the defendant always has the burden of establishing that
removal is proper.”) (internal quotation marks omitted). If there is any doubt regarding the
existence of subject matter jurisdiction, the court must resolve those doubts in favor of remanding

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

CV 20-9811 FMO (JEMx)

Date

Title

Child & Marton LLP v. Sentinel Insurance Company, Limited, et al.

November 18, 2020

the action to state court.1 See Gaus, 980 F.2d at 566 (“Federal jurisdiction must be rejected if
there is any doubt as to the right of removal in the first instance.”).
The court’s review of the NOR and the attached Complaint makes clear that the court does
not have subject matter jurisdiction over the instant matter. In other words, plaintiff could not have
originally brought this action in federal court, as plaintiff does not competently allege facts
supplying diversity jurisdiction.2 Therefore, removal was improper. See 28 U.S.C. § 1441(a);
Caterpillar Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 2429 (1987) (“Only state-court
actions that originally could have been filed in federal court may be removed to federal court by
the defendant.”).
Defendants bear the burden of proving by a preponderance of the evidence that the amount
in controversy meets the jurisdictional threshold. See Valdez v. Allstate Ins. Co., 372 F.3d 1115,
1117 (9th Cir. 2004); Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir.
2003) (per curiam) (“Where it is not facially evident from the complaint that more than $75,000 is
in controversy, the removing party must prove, by a preponderance of the evidence, that the
amount in controversy meets the jurisdictional threshold. Where doubt regarding the right to
removal exists, a case should be remanded to state court.”) (footnote omitted). Here, there is no
basis for diversity jurisdiction because the amount in controversy does not appear to exceed the
diversity jurisdiction threshold of $75,000. See 28 U.S.C. § 1332(a).3
As an initial matter, the amount of damages plaintiff seeks cannot be determined from the
Complaint, as the Complaint does not set forth a specific amount. (See, generally, Dkt. 1-1,
Complaint). Defendants primarily rely on the fact that plaintiff is a law firm, and contend that
plaintiff’s “allegations indicate lost business income for at least 171 days . . . or 46.8% of the year
[and that g]iven an annual sales estimate of $792,000, a reduction of income of approximately
46.8% would be around $370,656.” (Dkt. 1, NOR at 8). However, the Complaint does not allege
that plaintiff, a two-person firm, lost all income during the relevant time period, (see, generally, Dkt.
1-1, Complaint), and there is no evidence to support defendants’ contention. (See, generally, Dkt.
1, NOR). Defendants also contend that the amount in controversy exceeds the jurisdictional

1

An “antiremoval presumption” does not exist in cases removed pursuant to the Class
Action Fairness Act (“CAFA”), 28 U.S.C. § 1332(d). See Dart Cherokee Basin Operating Co., LLC
v. Owens, 574 U.S. 81, 89, 135 S.Ct. 547, 554 (2014).
2

Defendants seek only to invoke the court’s diversity jurisdiction. (See, generally, Dkt. 1,

NOR).
3

In relevant part, 28 U.S.C. § 1332(a) provides that a district court has diversity jurisdiction
“where the matter in controversy exceeds the sum or value of $75,000, . . . and is between . . .
citizens of different States” or “citizens of a State and citizens or subjects of a foreign state[.]” 28
U.S.C. §§ 1332(a)(1)-(2).
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES - GENERAL
Case No.

CV 20-9811 FMO (JEMx)

Date

Title

Child & Marton LLP v. Sentinel Insurance Company, Limited, et al.

November 18, 2020

threshold based on plaintiff’s requests for relief. (See id. at 7-8). However, defendants proffer no
evidence that might help the court determine whether plaintiff’s claims and requests for relief
would fulfill the amount in controversy requirement. (See, generally, id.). For the most part,
defendants merely cite to plaintiff’s alleged injuries and requested forms of relief as proof, ipso
facto, that the amount plaintiff seeks meets the amount in controversy requirement. (See id.).
Such unsubstantiated assertions, untethered to any evidence, cannot satisfy the amount in
controversy requirement of § 1332(a). See, e.g., Gaus, 980 F.2d at 567 (remanding for lack of
diversity jurisdiction where defendant “offered no facts whatsoever . . . [to] overcome[ ] the strong
presumption against removal jurisdiction, [and did not] satisf[y] [defendant’s] burden of setting forth
. . . the underlying facts supporting its assertion that the amount in controversy exceeds
[$75,000].”) (internal quotation marks omitted) (emphasis in original).
In sum, given that any doubt regarding the existence of subject matter jurisdiction must be
resolved in favor of remanding the action, see Gaus, 980 F.2d at 566, the court is not persuaded,
under the circumstances here, that defendants have met their burden of proving by a
preponderance of the evidence that the amount in controversy meets the jurisdictional threshold.
See Matheson, 319 F.3d at 1090 (“Where it is not facially evident from the complaint that more
than $75,000 is in controversy, the removing party must prove, by a preponderance of the
evidence, that the amount in controversy meets the jurisdictional threshold. Where doubt
regarding the right to removal exists, a case should be remanded to state court.”) (footnote
omitted); Valdez, 372 F.3d at 1117.
This order is not intended for publication. Nor is it intended to be included in or
submitted to any online service such as Westlaw or Lexis.
CONCLUSION
Based on the foregoing, IT IS ORDERED that:
1. The above-captioned action shall be remanded to the Superior Court of the State of
California for the County of Los Angeles, for lack of subject matter jurisdiction pursuant to 28
U.S.C. § 1447(c).
2. The Clerk shall send a certified copy of this Order to the state court.
3. Any pending motion is denied as moot.

Initials of Preparer

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