Aldea Homes, Inc., et al., v. Nole

Filing 13

ORDER signed by Judge Kimberly J. Mueller on 3/21/2013 GRANTING 9 Motion to Remand; REMANDING CASE to Superior Court of the State of California, County of Placer; ORDERING Defendant's counsel to personally pay Plaintiffs' attorneys' fees in the amount of $1,000.00; ORDERING Defendant's counsel to not pass this cost to her client; ORDERING Defendant's counsel to file a Declaration with this Court attesting that she has complied with this order in full. Copy of remand order sent to other court. CASE CLOSED. (Michel, G)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE EASTERN DISTRICT OF CALIFORNIA

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ALDEA HOMES, INC., TKR
PROPERTIES, LLC,

No. 2:12-cv-02962-KJM-EFB

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Plaintiffs,
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vs.
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STEVEN NOLE, and DOES 1 through 10,
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Defendants.

ORDER

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This matter comes before the court on plaintiffs’ motion to remand. (ECF 9.)

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The court has decided this matter without a hearing. For the following reasons, plaintiffs’

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motion to remand is granted. The court also awards plaintiffs attorney’s fees.

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I.

FACTS AND PROCEDURAL HISTORY

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Plaintiffs filed an unlawful detainer action against defendant in the Superior Court

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of California, County of Placer, on August 14, 2012. (Mot. to Dismiss and Mot. to Remand at 3,

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ECF 9.) The matter was tried on September 28, 2012 and judgment was entered in favor of

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plaintiffs. (Req. for Judicial Notice, Ex. 1, ECF 9-1.) On October 11, 2012, defendant removed

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the action to this district, arguing that removal was justified on federal question and diversity
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grounds. (Req. for Judicial Notice, Ex. 2 at 1, ECF 9-2.) The judge assigned to the matter at that

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time did not find jurisdiction on either of these grounds and therefore remanded the case to the

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Placer County Superior Court on December 3, 2012. (Id. at 3.) On December 7, 2012,

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defendant again removed the action to this court, alleging grounds of federal question and

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diversity jurisdiction. (ECF 1.) Defendant subsequently filed a cross-complaint against multiple

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corporate defendants, alleging violations of federal and California law in the foreclosure process.

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(Cross-compl., ECF 5.) Plaintiffs filed the present motion to remand on January 8, 2013. (ECF

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9.) Defendant filed an opposition on February 1, 2013 (ECF 10), and plaintiffs filed a reply on

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February 7, 2013 (ECF 12).

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In the instant motion, plaintiffs move to remand and also request costs and

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attorney’s fees associated with opposing defendant’s removal attempt. (ECF 9 at 7.) The court

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grants the motion to remand, declines to address plaintiffs’ cross-complaint, and awards

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attorney’s fees to plaintiffs.

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II.

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STANDARD
District courts have subject matter jurisdiction in two situations: 1) federal

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question jurisdiction over “civil actions arising under the Constitution, laws, or treaties of the

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United States;” and 2) diversity jurisdiction where “the matter in controversy exceeds the sum or

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value of $75,000, exclusive of interest and costs” and there is complete diversity between the

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parties. 28 U.S.C. §§ 1331, 1332(a). The removal statute, 28 U.S.C. § 1441(a), provides:

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“[A]ny civil action brought in a State court of which the district courts of the United States have

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original jurisdiction, may be removed by the defendant or the defendants, to the district court of

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the United States for the district and division embracing the place where such action is pending.”

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The Ninth Circuit “strictly construe[s] the removal statute against removal

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jurisdiction.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (citing Boggs v. Lewis,

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863 F.2d 662, 663 (9th Cir. 1988); Takeda v. Northwestern Nat'l Life Ins. Co., 765 F.2d 815, 818

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(9th Cir. 1985)). “Federal jurisdiction must be rejected if there is any doubt as to the right of
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removal in the first instance.” Id. (citing Libhart v. Santa Monica Dairy Co., 592 F.2d 1062,

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1064 (9th Cir. 1979)). There is a “strong presumption” against removal jurisdiction, which

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“means that the defendant always has the burden of establishing that removal is proper.” Id.; see

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also Abrego Abrego v. The Dow Chemical Co., 443 F.3d 676, 685 (9th Cir. 2006) (“[U]nder

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CAFA the burden of establishing removal jurisdiction remains . . . on the proponent of federal

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jurisdiction.”). Accordingly, “the court resolves all ambiguity in favor of remand to state court.”

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Hunter v. Phillip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 2009).

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III.

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ANALYSIS
A.

Motion to Remand
The defendant has not sustained his burden of showing removal jurisdiction. The

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court declines to accept removal for the same reasons the first removal motion was rejected on

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December 3, 2012. See Aldea Homes Inc. v. Nole, 2:12-CV-02546-GEB, 2012 WL 6020459

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(E.D. Cal. Dec. 3, 2012); (ECF 9-2). Diversity jurisdiction is not viable because both plaintiffs

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and defendant are citizens of California. (See Compl. in Superior Court of Cal., Placer County,

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at 3, ECF 1-2; ECF 9-1 at 8.) Federal question jurisdiction is not viable because plaintiffs’

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complaint in Placer County Superior Court contains a single state-law claim for unlawful

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detainer under California Code of Civil Procedure § 1161. (Id.)

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Defendant contends that the present removal action cures the deficiencies of the

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first removal attempt because he has also filed a cross-claim. (ECF 2 at 2-3.) The cross-claim

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names multiple corporate defendants that allegedly are organized outside of California. (ECF 5

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at 2-5.) The cross-claim alleges that these defendants perpetrated a wrongful foreclosure scheme

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involving violations of federal and state law. (Id.at 7-27.)

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Removal cannot be based on cross-claims filed after the removal action, however.

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“[P]ost-removal amendments to the pleadings cannot affect whether a case is removable, because

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the propriety of removal is determined solely on the basis of the pleadings filed in state court.”

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Williams v. Costco Wholesale Corp., 471 F.3d 975, 976-77 (9th Cir. 2006) (citing Sparta
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Surgical Corp. v. Nat'l Ass'n of Sec. Dealers, Inc., 159 F.3d 1209, 1213 (9th Cir. 1998);

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O'Halloran v. Univ. of Wash., 856 F.2d 1375, 1379 (9th Cir. 1988)). “Because post-removal

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pleadings have no bearing on whether the removal was proper, there is nothing a defendant can

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or need do to perfect the removal.” Id. (citing Yarnevic v. Brink's, Inc., 102 F.3d 753, 755 (4th

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Cir. 1996)). The court remands this case for lack of subject matter jurisdiction.

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B.

Request for Costs and Attorney’s Fees
Plaintiffs ask for costs and attorney’s fees incurred as a result of defendant’s

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baseless removal. (ECF 9 at 7.) They allege that removal was effected for purposes of

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harassment and delay. (Id.) Defendant denies these allegations. (ECF 10 at 4.)

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Title 28 U.S.C. § 1447© provides: “An order remanding the case may require

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payment of just costs and any actual expenses, including attorney fees, incurred as a result of the

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removal.” As the Ninth Circuit has observed, section 1447© was amended in 1988 explicitly to

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add “attorney fees” to the expenses that plaintiffs may recover upon an order of remand. Moore

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v. Permanente Med. Grp., Inc., 981 F.2d 443, 446 (9th Cir. 1992). In enacting section 1447©,

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Congress “unambiguously” left the decision to award fees to the discretion of the district court.

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(Id.) A district court may award fees to plaintiffs in section 1447© cases even absent a finding

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of bad faith. (Id.) The purpose of an award is not to punish defendants, but to reimburse

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plaintiffs for unnecessary litigation costs incurred as a result of the unsuccessful removal

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attempt. (Id. at 447.)

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The court finds that an award of attorney’s fees is appropriate in this case. The

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present attempt to remove relies upon the same reasons repudiated by the court in defendant’s

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first removal attempt. (See ECF 9-2.) Moreover, defendant seeks to remove after judgment has

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been entered in plaintiffs’ favor in state court. (ECF 9.2.) “Defendants may not ‘experiment’ in

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state court and remove upon receiving an adverse decision.” Moore, 981 F.2d at 447. Further,

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the strategy of filing for removal, then filing a cross-claim that alleges violations of federal law

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by out-of-state defendants in an effort to secure jurisdiction, is futile in the face of a motion to
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remand. As discussed above, it is clearly established law that a motion to remove cannot be

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based upon post-removal amendments to the pleadings. This second removal attempt has wasted

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judicial resources and unnecessarily prolonged the litigation.

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The Ninth Circuit uses the lodestar method for determining a reasonable attorney

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fee. See Morales v. City of San Rafael, 96 F.3d 359, 363 (9th Cir. 1996); McGrath v. County of

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Nevada, 67 F.3d 248, 252 (9th Cir. 1995); see also Albion Pac. Prop. Res., LLC v. Seligman,

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329 F. Supp. 2d 1163, 1166 (N.D. Cal. 2004) (using the lodestar method to assess attorney’s fees

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following an order of remand). Under the lodestar method, the court calculates the lodestar

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figure by “multiplying the number of hours the prevailing party reasonably expended on the

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litigation by a reasonable hourly rate.” Morales, 96 F.3d at 363 (citing McGrath, 67 F.3d at

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252).

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Counsel for plaintiffs has provided a declaration that he has spent four hours, at a

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rate of $250.00 per hour, in preparing and filing the motion to remand, and plaintiffs thus request

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$1000.00 in attorney’s fees. (ECF 9 at 9.) In the same declaration, counsel notes that additional

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fees will accrue in replying to any opposition to plaintiffs’ motion to remand and request for

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fees. (Id.) Although defendant filed an opposition and plaintiffs a reply, plaintiffs have not

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supplemented the amount in fees they seek. (See ECF 10 & 12.)

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The court finds the amount charged and time spent by plaintiffs’ counsel in

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preparing and filing the motion to remand reasonable. For four hours of work at a fee of $250.00

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per hour, the court thus orders defendant’s counsel to reimburse fees in the amount of $1000.00.

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IV.

CONCLUSION

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For the stated reasons, this case is remanded to the Superior Court of California,
County of Placer. The court additionally orders:
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Defendant’s counsel to pay to plaintiffs’ attorneys’ fees in the amount of
$1,000.00;
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2.

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Defendant’s counsel to pay this sanction herself and not pass on this cost to her
client; and

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Within two weeks of the date of this order, defendant’s counsel to file a

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declaration with this court attesting that she has complied with this order in full.

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IT IS SO ORDERED.

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DATED: March 21, 2013.

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UNITED STATES DISTRICT JUDGE

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