Tracy Randall et al v. Cambria Company, LLC et al

Filing 17

MINUTE Order GRANTING Plaintiffs' Motion to Remand (Dkt. No. 10 ) (IN CHAMBERS) by Judge Jesus G. Bernal. (SEE ORDER FOR FURTHER DETAILS) For the foregoing reasons, the Court finds that Alciatore is not a sham defendant, and that there is no t complete diversity between the Parties. Accordingly, the Court GRANTS Plaintiffs motion and REMANDS the action to state court. The Court also GRANTS Plaintiffs request for attorneys fees in the amount of $9,638.00. (Case Remanded to Riverside County Superior Court, Palm Springs District, PSC 1604977.) (MD JS-6. Case Terminated.) (iva)

JS-6
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No.

EDCV 17-1362 JGB (KKx)

Date August 16, 2017

Title Tracy Randall et al v. Cambria Company, LLC et al.

Present: The Honorable

JESUS G. BERNAL, UNITED STATES DISTRICT JUDGE

MAYNOR GALVEZ

Not Reported

Deputy Clerk

Court Reporter

Attorney(s) Present for Plaintiff(s):

Attorney(s) Present for Defendant(s):

None Present

None Present

Proceedings:

Order GRANTING Plaintiffs’ Motion to Remand (Dkt. No. 10) (IN
CHAMBERS)

Before the Court is Plaintiffs’ motion to remand the action to state court. (Dkt. No. 10.)
After consideration of the papers filed in support of and in opposition to the motion, as well as
the arguments of the Parties presented at the August 14, 2017 hearing, the Court GRANTS the
motion.
I.

INTRODUCTION

On September 30, 2016, Tracy Randall (“Randall”), Jamie Macknickie (“Macknickie”),
Andrea Mills (“Mills”) and Denise Pierce (“Pierce”) (collectively, “Plaintiffs”) initiated this
action against Cambria Company LLC (“Cambria”) and Karen Alciatore (“Alciatore”)
(collectively, “Defendants”) in California Superior Court for the County of Riverside.
(“Complaint,” Dkt. No. 1-1.) In brief, the Complaint alleges that, while employed at Cambria,
Plaintiffs were subjected to numerous sexist and racist comments by their managers and
retaliated against when they complained about these comments. Based on these allegations,
Plaintiff alleged six causes of action: (1) retaliation; (2) harassment; (3) associational harassment;
(4) wrongful termination; (5) failure to prevent harassment, discrimination, and retaliation;
and (6) declaratory judgment.
On July 6, 2017, more than nine months after this action was filed, Defendants removed
the action to this Court on the basis of diversity jurisdiction, asserting that Alciatore—a
California resident—was a fraudulently joined individual sham defendant. (Not. of Removal,
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Dkt. No. 1.) Plaintiffs subsequently filed the instant motion to remand the action to state court,
countering the contention that Alciatore is a sham defendant and challenging the removal on the
basis of untimeliness. (“Motion,” Dkt. No. 10.) Defendants opposed the motion on July 24,
2017. (“Opp’n,” Dkt. No. 12.) Plaintiffs filed their reply memorandum on July 31, 20.
(“Reply,” Dkt. No. 13.) The Court held a hearing on the matter on August 14, 2017.
II.

LEGAL STANDARD

“Federal courts are courts of limited jurisdiction, possessing only that power authorized by
Constitution and statute.” Gunn v. Minton, 133 S. Ct. 1059, 1064 (2013). As such, federal courts
only have original jurisdiction over civil actions in which a federal question exists or in which
complete diversity of citizenship between the parties exists and the amount in controversy exceeds
$75,000. See 28 U.S.C. §§ 1331, 1332. “Complete diversity” means that “each defendant must
be a citizen of a different state from each plaintiff.” In re Digimarc Corp. Derivative Litigation,
549 F.3d 1223, 1234 (9th Cir. 2008).
Moreover, the Ninth Circuit “strictly construe[s] the removal statute against removal
jurisdiction,” and “[f]ederal jurisdiction must be rejected if there is any doubt as to the right of
removal in the first instance.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992); see also
Jackson v. Specialized Loan Servicing, LLC, No. CV 14-05981 MMM PLAX, 2014 WL 5514142,
at *6 (C.D. Cal. Oct. 31, 2014) (quoting Gaus). “The strong presumption against removal
jurisdiction means that the defendant always has the burden of establishing that removal is
proper.” Jackson, 2014 WL 5514142, at *6. Doubts as to removability must be resolved in favor
of remanding the case to state court. Id. (internal citations omitted).
But removal is proper despite the presence of a non-diverse defendant where that
defendant is a fraudulently joined or sham defendant. Ritchey v. Upjohn Drug Co., 139 F.3d
1313, 1318 (9th Cir. 1998). As the Ninth Circuit has explained, “fraudulent joinder is a term of
art” and requires courts to look at whether a plaintiff has failed to state a cause of action against a
resident defendant. Id. Thus, the defendant must show that there is no possibility that the
plaintiff could prevail on any cause of action it brought against the non-diverse defendant. Id.;
see also Padilla v. AT & T Corp., 697 F. Supp. 2d 1156, 1159 (C.D. Cal. 2009) (defendant seeking
removal based on alleged fraudulent joinder “must do more than show that the complaint at the
time of removal fails to state a claim against the non-diverse defendant” but must also show that
“there is no possibility that the plaintiff could prevail on any cause of action it brought against the
non-diverse defendant”); Gloger v. Lynch, No. 2:16-CV-05445-CAS-E, 2016 WL 4770015, at *3
(C.D. Cal. Sept. 12, 2016) (noting that “the burden of proving a fraudulent joinder is a heavy
one” because “the removing party must prove that there is absolutely no possibility that the
plaintiff will be able to establish a cause of action against the in-state defendant in state court”);
Hurd v. Am. Income Life Ins., No. CV-13-05205 RSWL-MRW, 2013 WL 5575073, at *3 (C.D.
Cal. Oct. 10, 2013) (“The defendant must demonstrate that there is no possibility that the plaintiff
will be able to establish a cause of action in State court against the alleged sham defendant.”)
(internal marks omitted) (emphasis in original). Finally, the Ninth Circuit has explained that the

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general rule is that “the propriety of removal is determined solely on the basis of the pleadings
filed in state court.” Williams v. Costco Wholesale Corp., 471 F.3d 975, 976 (9th Cir. 2006).
III.

DISCUSSION

A. Fraudulent joinder
Under 28 U.S.C. § 1446(b), a defendant must file a notice of removal within 30 days from
the date he first objectively learns that an action is removable. A defendant may learn that an
action is removable in one of two ways: through the face of the initial pleadings or through the
receipt “of a copy of an amended pleading, motion, order or other paper from which it may first
be ascertained that the case is one which is or has become removable.” 28 U.S.C. § 1446(b);
Harris v. Bankers Life & Cas. Co., 425 F.3d 689, 692 (9th Cir. 2005). Courts in this Circuit have
found that a deposition constitutes an “other paper” under the statute. See, e.g., Riggs v. Cont'l
Baking Co., 678 F. Supp. 236, 238 (N.D. Cal. 1988); see also Amarant v. Home Depot U.S.A.,
Inc., No. 1:13-CV-00245-LJO-SK, 2013 WL 3146809, at *5 (E.D. Cal. June 18, 2013)
(“Interrogatory responses and other discovery documents as well as deposition testimony can
constitute an “other paper” under Section 1446(b), triggering the second 30–day period for
removal.”) Accordingly, Defendants argue that their removal was timely because it was filed
within thirty days of the last of the Plaintiffs’ depositions.1 (Opp’n at 6.) It was not until then,
they contend, that Defendants were able to ascertain that Plaintiffs’ claims against of harassment
against Alciatore were not viable. (Id.)
To the extent that the Complaint asserts allegations specifically against Alciatore, these
are as follows:
In February 2016, Alciatore asked Mills if she would sleep with her boss.
(Complaint ¶ 15.)
In February 2016, Alciatore told Mills she did not like women, that she would
never vote for a woman, that a woman should not be president, and that “she did
not like women who wear makeup, including Mills.” (Id.)
In February 2016, Alciatore told Randall that it was disgusting that she had dated a
black man. (Id.)
In February 2016, while they were having dinner, Alciatore suggested to Mills and
another employee that Hispanic individuals were “only good for” cooking and
gardening. (Id.) That same night, Alciatore told them that black people were
“dirty,” “filthy,” and “a drain on society.” (Id.) She further stated that
“Mexicans and blacks are disgusting.” (Id.)
In April 2016, after Plaintiffs had reported Alciatore’s comments to the president
of Cambria, Alciatore terminated Macknicki. (Id. at ¶ 25.) The president of

1

The last Plaintiff—Pierce—was deposed on June 6, 2017, and Defendants removed this
matter on July 6, 2017, within thirty days of Pierce’s deposition. (Opp’n at 6.)
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Cambria subsequently terminated Mills “because Alciatore decided she was not a
‘good fit’ for Cambria.” (Id.)
In May 2016, Alciatore terminated Randall. (Id. at ¶ 28.)
In July 2016, Pierce lodged complaints of a hostile work environment to the Senior
Vice President of Cambria. (Id. at ¶ 31.) Alciatore terminated her six days later.
(Id. at ¶ 32.)
Defendants do not declare outright that these allegations cannot possibly make out a
claim against Alciatore, but argue instead that the insufficiency of these claims was made clear
through Plaintiffs’ deposition testimony. (Opp’n at 7.) To this end, they parse the deposition
testimony of the individual Plaintiffs to make various arguments about whether the alleged
harassment was sufficiently pervasive, whether the comments in question were specifically
directed at the Plaintiffs, and so on. (See, e.g., Opp’n at 3-5.)
The Court finds that these kinds of arguments go to the weight of the evidence and not
the sufficiency of the allegations in the Complaint, as required at this stage. As noted above, the
standard for remand is not whether plaintiffs will actually or even probably prevail on the merits,
but whether there is a possibility that they may do so. Couscouris v. Hatch Grinding Wheels, Inc.,
No. CV 12-4464-GHK AGRX, 2012 WL 2190741, at *2 (C.D. Cal. June 14, 2012). Thus, “the
focus of the inquiry must be on the joinder, not on the merits of the plaintiff’s case.” Reynolds v.
The Boeing Co., No. 2:15-CV-2846-SVW-AS, 2015 WL 4573009, at *4 (C.D. Cal. July 28, 2015).
This means the Court “may not delve too far into the merits,” and must limit itself to “checking
for obviously fraudulent or frivolous claims.” Id. (internal citations and quotation marks
omitted).
Courts in this Circuit have resisted previous attempts to analyze fraudulent joinder cases
under a summary judgment framework, explaining that “piercing the pleadings is generally the
exception rather than the norm” and that courts should not resolve the merits of plaintiffs’
claims at this stage. See id. (noting that “district courts must exercise extraordinary care to avoid
jumbling up motions for remand and motions for summary judgment that come before them”);
see also Munoz v. Lab. Corp. of Am., No. EDCV 15-902-GW(DTBX), 2015 WL 4507104, at *1
(C.D. Cal. July 23, 2015) (“As Plaintiffs express in their Reply brief, the defendants' attempt to
argue fraudulent joinder here amounts to an attempt to argue either that Plaintiffs will not prevail
against Flanary or that Plaintiffs have not sufficiently alleged a claim against Flanary. That is not
the standard for assessing fraudulent joinder in the removal context.”); Dahmen v. McNeil-PPC,
Inc., No. CV 12-10371-GW(CWX), 2013 WL 12130314, at *2 (C.D. Cal. Jan. 14, 2013)
(“[N]otwithstanding the fact that Defendants are entitled to present facts, by way of summary
judgment-type evidence, in order to demonstrate fraudulent joinder, the Court is not required to
resolve the merits of Plaintiffs' claim at this stage.”); Amarant v. Home Depot U.S.A., Inc., No.
1:13-CV-00245-LJO-SK, 2013 WL 3146809, at *7 (E.D. Cal. June 18, 2013) (“Merely showing
that the evidence supporting a claim may be insufficient to survive summary judgment against a
non-diverse defendant, however, is no more adequate to prove fraudulent joinder than asserting a
claim is insufficiently pled such that it may not survive a motion to dismiss.”); Awasthi v.
InfoSys Techs. Ltd., No. C-10-0783 JCS, 2010 WL 2077161, at *6 (N.D. Cal. May 21, 2010)
(“The law is clear that this Court may not pre-try substantive factual issues in order to answer
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the discrete threshold question of whether joinder of a defendant is fraudulent.”); Berger v.
Harley Ellis Devereaux, No. CV 08-02318 MMM AGRX, 2008 WL 10610129, at *10 (C.D. Cal.
June 6, 2008) (“While the court can consider summary judgment-type evidence in assessing the
propriety of a fraudulent joinder claim, ultimately, the standard it must apply is closer to a Rule
12(b)(6) standard.”).
These cases are consistent with the Ninth Circuit’s admonition that joinder is only
fraudulent when “the plaintiff’s fail[ure] to state a cause of action against a resident defendant
. . . is obvious according to the settled rules of the state.” Hamilton Materials, Inc. v. Dow Chem.
Corp., 494 F.3d 1203, 1206 (9th Cir. 2007) (emphasis added). This rule statement delineates the
scope of the analysis: a court should look to whether the plaintiff has stated a claim—not whether
she has proven it. Moreover, the requirement that the failure to state a claim be obvious
precludes removal under the circumstances at hand, where Defendants seem to have conceded
that the allegations in the Complaint are sufficient to state a claim against Alciatore,2 and
challenge only whether such allegations have been borne out by the evidence. Again, this goes to
an analysis of the merits, not the sufficiency of the allegations. And, while Defendants argued at
the hearing that this Court may “pierce the pleadings” to analyze whether Plaintiffs have viable
claims against Alciatore, such factual inquiry is appropriate “only when the facts necessary to
sustain jurisdiction do not implicate the merits of the plaintiff's claim.” Dahmen, 2013 WL
12130314, at *2 (internal citations and quotation marks omitted). In sum, allowing Defendants to
remove the case on the merits on the basis of evidence developed during discovery would
undermine the removal standard, which focuses on the possibility that the state court could
recognize a cause of action.
What’s more, even if such analysis were appropriate, the Court disagrees that the
allegations cannot not rise to the level of harassment. Under FEHA, harassment consists of a
type of conduct not necessary for performance of a supervisory job, but rather “of conduct
outside the scope of necessary job performance, conduct presumably engaged in for personal
gratification, because of meanness or bigotry, or for other personal motives.” Id. This includes:
(a) verbal harassment, e.g. epithets, derogatory comments or slurs on a basis enumerated in the
Act; (b) physical harassment, e.g. assault, impeding or blocking movement, or any physical
2

If Defendants believed that such allegations were insufficient, they should have removed
the case nine months ago. Their attempt to avoid this conclusion is unsuccessful: they argue that
they “could not ascertain that there was no possibility for Plaintiffs to amend their complaint to
state a viable claim against Alciatore until the last of them was deposed” because the Complaint
“does not reveal the ground for removability.” (Opp’n at 6.) But “it is Defendants'
responsibility to analyze the facts and law as alleged in the original complaint to determine
whether the suit is removable.” Knutson v. Allis-Chalmers Corp., 358 F. Supp. 2d 983, 996–97
(D. Nev. 2005). While the subsequent discovery that certain facts alleged in the complaint are
untrue may be grounds for removing a case at a later date, “Defendants cannot justify removal
based on Plaintiff's failure to establish a more factually or legally compelling case than the case
alleged in the initial pleading.” Id. Here, Defendants have not actually pointed to anything in
the Complaint that is materially false.
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interference with normal work or movement, when directed at an individual on a basis
enumerated in the Act, or; (c) visual forms of harassment, e.g. derogatory posters, cartoons, or
drawings on a basis enumerated in the Act. Cal. Code Regs. Tit. 2 § 7287.6, subd. (b)(1). And, to
establish harassment, a plaintiff must show unwelcome conduct that is “sufficiently severe or
pervasive to alter the conditions of her employment and create an abusive working
environment.” Hurd v. Am. Income Life Ins., No. CV-13-05205 RSWL-MRW, 2013 WL
5575073, at *4 (C.D. Cal. Oct. 10, 2013).
Here, at least one of the Plaintiffs—Mills—has shown that Alciatore subjected her to
repeated and outrageous comments about her gender and her race, and that Alciatore directed
her termination after she complained about these comments. Based on these allegations, a jury
could reasonably conclude that her work environment was hostile. And, if even one of the
Plaintiffs has a colorable claim against Alciatore, the Court cannot dismiss her as a sham
defendant. See cf. Christ v. Staples, Inc., No. CV 14-07784 MMM JEMX, 2015 WL 248075, at
*4 (C.D. Cal. Jan. 20, 2015) (“In order to establish that there has been no fraudulent joinder, a
plaintiff need only have one potentially valid claim against a non-diverse defendant.”) (internal
citations and quotation marks omitted).
Moreover, Defendants make several arguments that directly contradict allegations in the
Complaint. For example, Defendants argue that Mills “cannot show that Alciatore harassed her
because of her Mexican ancestry,” and cite to a self-serving declaration and deposition testimony
from Alciatore. (Opp’n at 13) (emphasis added). But it is certainly plausible that a jury may not
find Alciatore’s testimony to be credible.3 Defendants also argue that, “[a]s none of Alciatore’s
alleged comments were made in their presence, Macknicki and Mills could not have been the
target of harassment—associational or otherwise—and cannot possible state a viable claim of
harassment against Alciatore.” (Opp’n at 11.) But, as the Complaint indicates, Alciatore made
multiple derogatory comments to Mills, including asking whether she would sleep with her boss
and stating that she did not like women, that black individuals are “a drain on society,” and that
“Mexicans and blacks are disgusting.” Plaintiffs’ deposition testimony reaffirms that Alciatore
made such statements to them. (See, e.g., Deposition of Andrea Mills at 113-121.) It is unclear,
then, why Defendants think none of these comments were made in her presence.4 Besides, the

3

Of course, Plaintiffs’ allegations also indicate that Alciatore harassed Mills on the basis
of gender, not just national origin, and Defendants cannot dispute that Alciatore knew that Mills
was a woman.
4

Defendants’ position seems to be that Alciatore’s statements were not harassment
because they were not directed at Mills—e.g., Alciatore “never said, ‘Andrea you are a dirty
Mexican,’” (Mills Dep. Tr. at 223-225)—but the Court does not find this distinction dispositive.
At this stage, it is sufficient to establish a hostile work environment that Alciatore made blatantly
disparaging comments about women and Mexicans directly to Mills—who is Mexican and a
woman—regardless of whether Alciatore specified in explicit terms that Mills was the direct
target of her vitriol.
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Court emphasizes that the standard at this stage calls for viewing the allegations in the light most
favorable to Plaintiffs, and that the burden is firmly on Defendants to justify removal. And, as
discussed above, Plaintiffs' alleged inability to make out a claim against Alciatore is, at the very
least, not “obvious,” even if their allegations and evidence would be insufficient to survive
summary judgment. On this basis, the Court concludes that Alciatore is not a sham defendant,
and that the Parties are therefore non-diverse. Accordingly, the Court GRANTS Plaintiffs’
motion to remand the matter to state court.
B.

Attorneys’ fees

In addition to remand, Plaintiffs seek attorney fees incurred as a result of improper
removal. This is pursuant to 28 U.S.C. § 1447(c), which provides that “[a]n order remanding
the case may require payment of just costs and any actual expenses, including attorney fees,
incurred as a result of the removal.” The Supreme Court has clarified that, “absent unusual
circumstances, attorney's fees should not be awarded when the removing party has an objectively
reasonable basis for removal.” Martin v. Franklin Capital Corp., 546 U.S. 132, 136 (2005); see
also Moore v. Permanente Medical Group, Inc., 981 F.2d 443, 446–47 (9th Cir.1992) (upholding
fee award for “wholly unnecessary litigation costs” related to remand motion).
Here, the Court agrees that Defendants have not satisfactorily explained their failure to
seek removal within thirty days of service of the Complaint. As noted above, a defendant may
justify a later removal following receipt “of a copy of an amended pleading, motion, order or
other paper from which it may first be ascertained that the case is one which is or has become
removable.” 28 U.S.C. § 1446(b). Here, Defendants argue that “[they] could not ascertain that
there was no possibility for Plaintiffs to amend their complaint to state a viable claim against
Alciatore until the last of them was deposed.” (Opp’n at 6.) But Defendants have not pointed to
anything in Pierce’s deposition that would reveal the case to be removable and that was not
already clear from Plaintiffs’ allegations in their Complaint. For example, one of Defendants’
arguments for dismissing Alciatore is that she could not have discriminated against Mills for
being Mexican because she did not know Mills was Mexican. (Opp’n at 13.) But this
argument—regardless of its viability—could have been made nine months ago: presumably,
Alciatore could have raised her lack of knowledge as soon as the Complaint was filed.
Similarly, Defendants argue that Randall’s harassment claim cannot survive because
Alciatore’s statement that it was “disgusting” that Randall’s ex was black “refer[ed] to
Randall’s husband, not her,” so “Randall was not the target of the alleged comment.” (Notice
Defendants also argue that the comments did not occur “in [Mills’] immediate work
environment because they took place at a “completely voluntary dinner.” (Opp’n at 15.) There
is no evidence before the Court to indicate that the dinner with Alciatore was “completely
voluntary,” rather than part of a work event. In fact, the Complaint indicates that these dinners
were work events. (Complaint ¶ 15 (“Mills had a work dinner with Alciatore.”)) What’s more,
the deposition testimony reaffirms that the dinner in question was part of a training event. (See
Opp’n at 3 (noting allegations that Alciatore made racist remarks “on February 23 and February
24, 2016, in Minnesota while they were there for training.”))
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of Removal at 7.) But again, the necessary information was already in the Complaint; Randall’s
deposition only confirmed the facts as alleged there. It is therefore disingenuous for Defendants
to argue that the deposition somehow “revealed” that Randall did not have standing to make a
claim when their argument is based exactly on the allegations as made in the Complaint. What’s
more, Defendants mischaracterize the evidence on the record, apparently to justify their late
removal: they claim that Mills’ deposition testimony confirmed that the harassing comments
were made “during social gatherings outside the workplace.” (Id.) But Mills’ testimony in fact
indicates that the dinners—during which Alciatore made such comments as telling her that she
“didn’t like women”—were part of training events. (See Mills Dep. At 117, 139 (explaining that
Alciatore set up dinner with her “to talk about our training.”) These weak justifications for
waiting until discovery was well underway in state court to remove the case suggest that
Defendants were “experimenting” in state court and reserving to themselves the right to remove
should their fortunes worsen. This strategy has wasted judicial resources and unnecessarily
prolonged the litigation. Altogether, the Court finds that attorneys’ fees are justified under the
circumstances.
The Ninth Circuit uses the lodestar method for determining a reasonable attorney fee.
Morales v. City of San Rafael, 96 F.3d 359, 363 (9th Cir. 1996). Under the lodestar method, the
court calculates the lodestar figure by “multiplying the number of hours the prevailing party
reasonably expended on the litigation by a reasonable hourly rate.” Id. at 363. Counsel for
Plaintiffs has provided a declaration that he has spent a total of 15.8 hours, at a rate of $610.00
per hour, in drafting the motion to remand, drafting the reply brief, and preparing for and
appearing at the hearing. (Declaration of Cory Hurwitz ¶ 10, Dkt. No. 10-1.) The Court finds
the amount charged and time spent by Plaintiffs' counsel in preparing and filing the motion to
remand reasonable in light of the necessities of the motion.5 Accordingly, the Court orders
Defendants’ counsel to reimburse fees in the amount of $9,638.00.
IV.

CONCLUSION

For the foregoing reasons, the Court finds that Alciatore is not a sham defendant, and that
there is not complete diversity between the Parties. Accordingly, the Court GRANTS Plaintiffs’
motion and REMANDS the action to state court. The Court also GRANTS Plaintiffs’ request
for attorneys’ fees in the amount of $9,638.00.
IT IS SO ORDERED.

5

Specifically, preparing the motion required counsel to review the deposition testimony
of all the Plaintiffs, among other things, to counter Defendants’ characterization of the
testimony.
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