Miranda Kral v. J Choo USA, Inc. et al

Filing 23

MINUTES (IN CHAMBERS) ORDER ON MOTION TO REMAND AND REQUEST FOR SANCTIONS (ECF No. 14 ) by Judge Mark C. Scarsi. Plaintiff's motion to remand is GRANTED. Plaintiff's request for sanctions is DENIED. The case is remanded to the Los Angeles County Superior Court for further proceedings. MD JS-6. Case Terminated. (lom)

JS-6

harassment because of her sexual orientation in violation of the California Fair
Employment and Housing Act (“FEHA”), Cal. Gov’t. Code §§ 12940 et seq.,
(Compl. ¶¶ 3, 9(a)–(g), 51(a)–(g)), and intentional infliction of emotional distress,
(id. ¶¶ 134–46). Plaintiff brings those and additional claims against JCUSA. (See
generally Compl.) Chilstrom is a citizen of California. (Id. ¶ 3; see also Notice of
Removal (“NOR”) ¶¶ 24–29; ECF No. 1.) Notwithstanding, JCUSA removed the
case to federal court, asserting diversity jurisdiction and arguing Chilstrom’s
citizenship should be disregarded because he is a sham defendant. (NOR ¶¶ 8–9, 24–
29.)
II.

LEGAL STANDARDS
A.

Remand

“Federal courts are courts of limited jurisdiction, possessing only that power
authorized by Constitution and statute.” Gunn v. Minton, 568 U.S. 251, 256 (2013)
(internal quotation marks omitted). A defendant may remove to federal district court
a civil action brought in state court when a federal court has original jurisdiction
over the action. 28 U.S.C. § 1441(a). There is a “strong presumption” against
removal jurisdiction, and the removing party bears the burden of proving that
removal is proper. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992).
To invoke diversity jurisdiction, a party must demonstrate that there is
complete diversity of citizenship between the parties and that the amount in
controversy exceeds the sum or value of $75,000, exclusive of interest and costs. 28
U.S.C. § 1332(a). In evaluating diversity jurisdiction, the Court “may disregard the
citizenship of a non-diverse defendant who has been fraudulently joined.”
GranCare, LLC v. Thrower, 889 F.3d 543, 548 (9th Cir. 2018). “There are two ways
to establish fraudulent joinder: (1) actual fraud in the pleading of jurisdictional facts,
or (2) inability of the plaintiff to establish a cause of action against the non-diverse
party in state court.” Id. (internal quotation marks omitted). In evaluating a claim of
fraudulent joinder, “a federal court must find that a defendant was properly joined
and remand the case to state court if there is a ‘possibility that a state court would
find that the complaint states a cause of action against any of the [non-diverse]
supplement’s contents are immaterial because Plaintiff’s failure to serve Chilstrom
prior to JCUSA removing this case does not abrogate 28 U.S.C. § 1332(a)’s
requirement of complete diversity. See Lopez v. United Parcel Serv., Inc., No. SACV
21-01492-CJC (DFMx), 2021 WL 5122293, at *2 (C.D. Cal. Nov. 3, 2021).
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defendants.’” Id. (alteration in original) (quoting Hunter v. Philip Morris USA, 582
F.3d 1039, 1046 (9th Cir. 2009)). In this inquiry, “the district court must
consider . . . whether a deficiency in the complaint can possibly be cured by granting
the plaintiff leave to amend.” Id. at 550. There is a presumption against fraudulent
joinder, and “defendants who assert fraudulent joinder carry a heavy burden of
persuasion.” Tanner v. Ford Motor Co., 424 F. Supp. 3d 666, 670 (N.D. Cal. 2019).
B.

Sanctions

Pursuant to 28 U.S.C. § 1447(c) and Federal Rule of Civil Procedure 11,
Plaintiff requests attorneys’ fees associated with bringing the motion to remand.
(Mot. 17–18.) “Absent unusual circumstances, courts may award attorney[s’] fees
under § 1447(c) only where the removing party lacked an objectively reasonable
basis for seeking removal.” Martin v. Franklin Cap. Corp., 546 U.S. 132, 141
(2005). A court may issue sanctions under Rule 11(c) if the court determines that a
filing was presented for an improper purpose or is factually or legally frivolous. Fed.
R. Civ. P. 11(b)–(c).
III.

DISCUSSION
A.

Motion to Remand

For this Court to maintain jurisdiction over the matter, JCUSA must show that
there is no possibility Plaintiff can recover against Chilstrom on any claim. Padilla
v. AT & T Corp., 697 F. Supp. 2d 1156, 1158 (C.D. Cal. 2009). Because remand is
required if Plaintiff can sustain just one claim against Chilstrom, id., the Court need
only evaluate the sufficiency of Plaintiff’s first claim against Chilstrom for
harassment based on sex/gender under the FEHA, (Compl. ¶ 9(a)–(g)).
JCUSA argues Plaintiff cannot maintain any claim for harassment against
Chilstrom under the FEHA based on the purported verbal comments alone because
“Plaintiff’s allegations are based on conduct that is part of the normal employment
relationship,” (NOR ¶ 36), and because Plaintiff’s claims fail to show her
“employment ‘permeated with . . . intimidation, ridicule, and insult that is
sufficiently severe or pervasive to alter the conditions of [her] employment and
create an abusive working environment,’” (Opp’n 9 (quoting Haley v. Cohen &
Steers Cap. Mgmt., Inc., 871 F. Supp. 2d 944, 958 (N.D. Cal. 2012))). Under the
FEHA, it is unlawful “[f]or an employer . . . or any other person, because of . . . sex[
or] gender . . . to harass an employee.” Cal. Gov’t Code § 12940(j)(1). To constitute
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harassment, conduct must be “sufficiently severe or pervasive to alter the conditions
of [the victim’s] employment and create an abusive work environment.” Aguilar v.
Avis Rent A Car Sys., Inc., 21 Cal. 4th 121, 130 (1999) (alteration in original)
(quoting Meritor Sav. Bank, FSB v. Vinson, 477 U.S. 57, 67 (1986)). In California,
“a single incident may be enough to constitute a hostile work environment in the
context of a workplace harassment claim.” Vazquez v. Costco Wholesale Corp., No.
CV 21-2563 PSG (JCs), 2021 WL 1784342, at *3 (C.D. Cal. May 5, 2021) (citing
Cal. Gov’t Code § 12923(b)).
Plaintiff alleges that Chilstrom harassed her based on her sex/gender. (Compl.
¶¶ 3, 9(a)–(g)). Plaintiff further alleges that, because of these characteristics,
Chilstrom harassed her throughout the course of her employment by making
demeaning, harassing, sex/gender-based comments to her. (Id.) JCUSA argues the
statements Plaintiff attributes to Chilstrom are insufficient for her to prevail on her
sex/gender harassment claim under FEHA because the statements are neither severe
nor pervasive. (See Opp’n 9–11.) In support of its argument, JCUSA cites
unpublished, nonbinding authority where courts found plaintiffs could not sustain
harassment claims against their individual supervisors under the FEHA. (Id.) Both
cases are distinguishable on their facts. In Mendoza v. Staples, Inc., the district court
found that comments made by a supervisor defendant to the plaintiff regarding her
age were insufficient to state a claim for harassment under the FEHA because they
occurred on just two isolated occasions. No. CV 14-07837 BRO (FFMx), 2014 WL
6670221, at *4 (C.D. Cal. Nov. 24, 2014). However, the court found the comments
could “conceivably go beyond [the individual defendant’s] supervisory role and
could have been engaged in for personal gratification.” Id. Thus, the court rested its
finding not on the nature of the supervisor’s comments, but the infrequency of the
comments.2 Similarly, in Wexler v. Jensen Pharmaceuticals, Inc., the district court
found the plaintiff could not sustain a claim against her supervisor under the FEHA
for two isolated comments related to the plaintiff’s age over a two-year period
because, taking all of supervisor’s actions together, this was “neither severe nor
pervasive, such that they arguably altered the conditions of Plaintiff’s employment.”
No. CV 15-03518-AB (AJWx), 2015 WL 6159101, at *5 (C.D. Cal. Oct. 20, 2015.)3
2

The Court also questions whether Mendoza remains good law. The circuit court has
since clarified that courts must evaluate whether the plaintiff could state a claim
against a purportedly fraudulently joined defendants upon amendment. See
GranCare, 889 F.3d at 550. The Mendoza court did not engage in such an analysis.
3
JCUSA also cites Pineda v. Abbott Laboratories, Inc., No. 2:18-cv-03395-SVWRAO, 2018 WL 3487111, at *2–4 (C.D. Cal. July 18, 2018), in support of its
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Here, Plaintiff alleges that Chilstrom made several harassing, sex/genderbased comments to Plaintiff about female customers’ bodies on a daily basis,
(Compl. ¶ 9(a), see also id. ¶ 9(e)), and that he repeatedly told her he didn’t respect
her because of her sex/gender, (id. ¶ 9(b)). Plaintiff provides direct quotations of the
purported comments and avers Chilstrom made the comments continuously
throughout her employment with JCUSA from November 2021 until her termination
on August 18, 2022. (Id. ¶¶ 7, 9.) JCUSA fails to demonstrate it is “obvious under
settled state law” that Plaintiff cannot prevail against Chilstrom on this claim, Burris
v. AT & T Wireless, Inc., No. C 06-02904 JSW, 2006 WL 2038040, at *2 (N.D. Cal.
July 19, 2006), and it is conceivable based on the allegations in the complaint that
Plaintiff could in fact recover against him. JCUSA has failed to show “there is no
possibility that the plaintiff could prevail on any cause of action . . . brought against
the non-diverse defendant.” Id. at *1. Therefore, remand is warranted. 28 U.S.C.
§ 1447(c).
B.

Request for Sanctions

Plaintiff requests sanctions if the Court remands on the grounds that JCUSA’s
removal was “not based upon objectively reasonable grounds.” (Mot. 17.) After a
review of the record, the Court finds that Plaintiff has failed to establish that
JCUSA’s removal was not objectively reasonable, frivolous, or presented for an
improper purpose. Martin, 546 U.S. at 138, Fed. R. Civ. P. 11(b)–(c). JCUSA
removed the action to this Court arguing Chilstrom was a sham defendant and,
therefore, his citizenship should not be considered for purposes of assessing diversity
jurisdiction. JCUSA provided reasonable argument and legal authority to support its
position. Though the Court ultimately disagrees with JCUSA, its position was
objectively reasonable and neither frivolous nor presented for an improper purpose.
(See generally NOR; Opp’n.) Therefore, Plaintiff’s motion for sanctions is DENIED.
///

argument but provides no analysis relating Plaintiff’s claims to those made in
Pineda. (See Opp’n 10.) The Court fails to see the relevance of Pineda. There, the
court found the plaintiff failed to allege a harassment claim under FEHA against his
supervisor based solely on plaintiff witnessing his supervisor writing up and
harassing older employees. 2018 WL 3487111, at *3. This is clearly different from
Plaintiff’s FEHA claims here, which are premised on statements Chilstrom
purportedly made directly to her.
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IV.

CONCLUSION

Plaintiff’s motion to remand is GRANTED. Plaintiff’s request for sanctions is
DENIED. The case is remanded to the Los Angeles County Superior Court for
further proceedings. The Court directs the Clerk to effect the remand immediately
and close the case.
IT IS SO ORDERED.

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