Grant v. Capella University et al

Filing 28

ORDER RE: Plaintiff's Motion to Dismiss (Remand) and Defendant's Motion to Dismiss or for a More Definite Statement, signed by District Judge Anthony W. Ishii on 7/9/15: 30-Day Deadline. (Hellings, J)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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O’DEAN M. GRANT,

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CASE NO. 1:14-CV-01678-AWI-JLT

Plaintiff
v.
CAPELLA UNIVERSITY, SOPHIA
PATHWAYS, AND DOES 1-12,

ORDER RE: PLAINTIFF’S MOTION
TO DISMISS (REMAND) AND
DEFENDANT’S MOTION TO DISMISS
OR FOR A MORE DEFINITE
STATEMENT

Defendants
I. INTRODUCTION
On October 27, 2014, this case was removed from Superior Court, County of Kern. Doc. 1,

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1. On November 26, 2014, O’Dean Grant (“Plaintiff”) filed a motion entitled “Motion to Dismiss

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Pursuant to 28 U.S.C.A. #1331” that sought a hearing on December 9, 2014 in Kern County

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Superior Court. Doc. 8. That same day, Plaintiff filed a motion entitled “Motion to Dismiss

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Removal of Action to District Court.” Doc. 9. Plaintiff’s motions will be treated as a motion for

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remand. Defendants filed a separate motion to dismiss pursuant to Federal Rules of Civil

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Procedure 12(b)(1) (“Rule 12(b)(1)”) and Federal Rules of Civil Procedure 12(b)(6) (“Rule

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12(b)(6)”). Doc. 7. Defendant’s motion also included, in the alternative, a request for more

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definite statement pursuant to Federal Rules of Civil Procedure 12(e) (“Rule 12(e)”). The court

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conflated the motions and took both matters under submission. Doc. 10.

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II. BACKGROUND
On March 20, 2014, Plaintiff filed a complaint in the Superior Court of California, County
of Kern. Plaintiff filed in pro per. Doc. 1, 37. The complaint was filed on the standard Judicial

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Counsel form naming Capella University Inc. and Sophia Learning, LLC (erroneous named and

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served as Sophia Pathways) (collectively “Defendants”) and Doe defendants one through 12. Doc.

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1, 38. The body of the complaint asserts a cause of action under the theory of intentional tort. Doc.

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1, 39. However, Plaintiff has attached complaint forms that assert two causes of action, one under

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the theory of negligence and one under the theory of intentional tort. Doc 1, 40-41. Plaintiff’s

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complaint is based on events that allegedly occurred while Plaintiff was attending online courses

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offered by Defendants. Doc 1, 40-41. Under the intentional tort cause of action, Plaintiff alleges

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Defendants “intentionally hindered, obstruct[ed], impeded and deterred” Plaintiff’s “ability to

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learn and participate” in courses. Doc. 41. Specifically, Defendants interfered with Plaintiff’s

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ability to access necessary tools by causing malfunctions in Plaintiff’s online course page, and

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Defendants denied Plaintiff access to required materials by failing to provide a book allowance.

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Doc. 1, 41. Plaintiff alleges Defendants’ conduct was fraudulent. Doc. 1, 41. Under the negligence

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cause of action, Plaintiff alleges that Defendants breached a professional duty of care owed to

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Plaintiff by withholding “all the transferrable credits available to [Plaintiff] as a transfer student.”

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Plaintiff indicates only 115 units out of a total of 167 transfer units were accepted. Doc. 1, 40.

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Plaintiff also alleges Defendants violated his Civil Rights, but provides no further details. Plaintiff

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seeks a judgment against Defendants in the amount of $150,000 in damages. Doc. 1, 39.

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III. DISCUSSION
A. Legal Standard

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28 United States Code section 1447(c) provides that when a case is removed from state

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court, “[i]f at any time before final judgment it appears that the district court lacks subject matter

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jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447 (2012). The statute governing removal,

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28 United States Code section 1441, is strictly construed against removal. Geographic

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Expeditions, Inc. v. Estate of Lhotka, 599 F.3d 1102, 1107 (9th Cir. 2010); Provincial Gov’t of

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Marinduque v. Placer Dome, Inc., 582 F.3d 1083, 1087 (9th Cir. 2009); Boggs v. Lewis, 863 F.2d

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662, 663 (9th Cir. 1988). For this reason, it is presumed that a case lies outside the limited subject

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matter jurisdiction of the federal courts, and the burden of establishing the contrary rests upon the
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party asserting jurisdiction. Geographic Expeditions, Inc. v. Estate of Lhotka, 599 F.3d at 1107;

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Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 2009). Defendants removed this

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action from the Superior Court, County of Kern, and have the burden of establishing the

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jurisdiction of the federal courts. Doc. 1. “[A]ny civil action brought in a State court of which the

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district courts of the United States have original jurisdiction, may be removed by the defendant or

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the defendants.” 28 U.S.C. § 1441(a) (2012). Original jurisdiction may be established based on the

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presence of a federal question or through diversity of citizenship. 28 U.S.C. § 1331-32 (2012).

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However, when a claim is removed and jurisdiction is based on diversity of citizenship, none of

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the defendants may be “citizen[s] of the State in which such action is brought.” 28 U.S.C. §

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1441(b)(2) (2012).

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B. Defendants’ Removal of Plaintiff’s Action

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Defendants filed a notice of removal on October 27, 2014. Doc. 1. A “notice of removal of

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a civil action or proceeding shall be filed within 30 days after the receipt by the defendant. . . of a

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copy of the initial pleading setting forth the claim for relief upon which such action or

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proceeding.” 28 U.S.C. § 1446(b)(1) (2012). Defendants allege they were served a copy of

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Plaintiff’s first amended complaint (FAC) on September 29, 2014. Doc. 1, 2:2. There is no

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indication Defendants were aware of Plaintiff’s claim prior to September 29, 2014, and Plaintiff

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does not allege Defendants were served prior to September 29, 2014. Defendants’ notice of

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removal, filed within 30 days of Defendant’s receipt of the FAC, is filed timely. The general rule

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is that “all defendants in a state action must join in [a] petition for removal.” Emrich v. Touche

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Ross & Co., 846 F.2d 1190, 1193 n.1 (9th Cir. 1988). However, when a defendant is not “properly

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joined and served in the action” the party does not need to join in a petition for removal. Id.

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Plaintiff filed the FAC on March 20, 2014. Doc. 1, 37. Both named defendants joined in the

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petition for removal. Doc 1, 1. Plaintiff’s FAC includes 12 unnamed Doe defendants, but the

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record does not indication any of the Doe defendants were identified or served as of October 27,

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2014. Defendants’ notice of removal was procedurally valid because all properly served

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defendants joined in the petition and the petition was filed timely.
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In Plaintiff’s motion for remand, he argues removal of the case to the federal court was

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improper. Specifically, Plaintiff argues there is no federal question and there is not complete

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diversity of citizenship between the parties. Doc 8, 1:20 & 2:6. Defendants notice of removal

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alleges the court has original jurisdiction based on diversity of citizenship. Doc. 1, 2:22. Neither

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party has alleged the court has original jurisdiction based on the existence of a federal question, as

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such, the court will not consider this matter.

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Jurisdiction is conferred on district courts through diversity of citizenship when there is: 1)

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complete diversity of citizenship, and 2) the amount in controversy exceeds $75,000. 28 U.S.C. §

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1332(a) (2012). The amount in controversy is generally determined from the face of the pleadings.

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See Crum v. Circus Circus Enterprises, 231 F.3d 1129, 1131 (9th Cir. 2000); Pachinger v. MGM

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Grand Hotel-Las Vegas, Inc., 802 F.2d 362, 363 (9th Cir. 1986).

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Plaintiff’s FAC seeks damages in the amount of $150,000. Doc. 1, 39. The amount in

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controversy exceeds $75,000, which satisfies one of the two requirements of diversity jurisdiction.

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The other requirement of diversity jurisdiction, complete diversity of citizenship, is established

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when “each defendant is a citizen of a different State from each plaintiff. Owen Equip. & Erection

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Co. v. Kroger, 437 U.S. 365, 373, 98 S. Ct. 2396, 57 L. Ed. 2d 274 (1978). Challenges to diversity

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of citizenship must be based on “the state of facts that existed at the time of filing. In re Digimarc

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Corp. Derivative Litig., 549 F.3d 1223, 1236 (9th Cir. 2008) (citation omitted). A natural person’s

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state citizenship is “determined by [his/]her state of domicile.” Kanter v. Warner-Lambert Co.,

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265 F.3d 853, 857 (9th Cir. 2001). “A person's domicile is [his/]her permanent home, where

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[he/]she resides with the intention to remain or to which [he/]she intends to return.” Kanter v.

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Warner-Lambert Co., 265 F.3d at 857; Lew v. Moss, 797 F.2d 747, 749 (9th Cir.1986). In

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Plaintiff’s FAC, he provide a contact address in California. Doc. 1, 37. Plaintiff also filed the FAC

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in California. Doc. 1, 37. There is no indication Plaintiff has a permanent home outside of

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California, so Plaintiff is regarded as a citizen of California for diversity of citizenship purposes.

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Defendant Capella University is a corporation. Doc. 1, 1:20. “[A] corporation shall be deemed to

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be a citizen of every State and foreign state by which it has been incorporated and of the State or

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foreign state where it has its principal place of business.” 28 U.S.C. § 1332(c)(1) (2012).
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Defendants indicate Capella University is a Minnesota corporation with its principal place of

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business being in Minnesota. Doc. 1, 12-13. Plaintiff has not provided facts to the contrary.

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Capella University and Plaintiff are not citizens of the same state, so there is diversity of

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citizenship between these parties.

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Defendant Sophia Learning, LLC is a limited liability company. Doc. 1, 2:13. LLC legal

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entities “resemble both partnerships and corporations.” Johnson v. Columbia Properties

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Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006). When confronted with the issue of how to

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determine the citizenship of a LLC for purposes of 28 United States Code section 1332, the Ninth

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Circuit noted that the Supreme Court has consistently “refus[ed] to extend the corporate

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citizenship rule to non-corporate entities, including those that share some of the characteristics of

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corporations.” Id. (referring to the Supreme Court’s refusal to extend the corporation citizenship

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rule to limited partnerships or to limited partnership associations). Taking this into consideration,

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the Ninth Circuit held that LLC entities should be treated “like partnerships for the purposes of

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diversity jurisdiction.” Id. As such, “[a] LLC is a citizen of every state of which its

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owners/members are citizens.” Id. Defendants indicate Sophia Learning, LLC is a Delaware

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limited liability company with a principal place of business in Minnesota. Doc. 1, 2:13. However,

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Defendants do not indicate the state citizenship of the LLC owner/members. Based on record, the

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court cannot determine whether there is diversity of citizenship between defendant Sophia

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Learning, LLC and Plaintiff.

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The court will order defendant Sophia Learning, LLC to provide a list of all

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owner/members of Sophia Learning, LLC. The list should include sufficient information for the

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court to determine the citizenship of all owner/members, including: the state of domicile for any

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natural persons that are owner/members; the state of incorporation and principal place of business

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of any corporations that are owner/members; and the corresponding owner/members of any LLC

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or partnership owner/members of Sophia Learning LLC. The information provided should be

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reflective of the point in time when the FAC was filed. Upon receipt of the additional information,

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the court will determine whether removal was proper. If the court has original jurisdiction over

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the claim, the court will address Defendants’ separate motions.
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IV. ORDER

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Accordingly, IT IS HEREBY ORDERED that defendant Sophia Learning, LLC file a response to

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Plaintiff’s motion for remand within 30 days. Specifically, defendant Sophia Learning, LLC

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should address Plaintiff’s claim that complete diversity of citizenship is lacking.

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IT IS SO ORDERED.
Dated:

July 9, 2015
SENIOR DISTRICT JUDGE

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