Mendala v. Cheung

Filing 28

ORDER GRANTING PLAINTIFF'S MOTION TO REMAND AND REMANDING ACTION TO SAN FRANCISCO SUPERIOR COURT (Illston, Susan) (Filed on 12/19/2011)

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IN THE UNITED STATES DISTRICT COURT
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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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ROBERT MENDALA,

No. C 11-04882 SI

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Plaintiff,
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United States District Court
For the Northern District of California

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IRENE CHEUNG, TIEMPO INTERIORS,
and DOES 1 through 50,
Defendants.

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ORDER GRANTING PLAINTIFF’S
MOTION TO REMAND AND
REMANDING ACTION TO SAN
FRANCISCO SUPERIOR COURT

v.

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Before the Court is plaintiff’s motion to remand this case to San Francisco Superior Court. A

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hearing was set for this motion on December 16, 2011, but pursuant to civil local rule 7-1(b), the Court
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determined this matter appropriate for resolution without oral argument, and vacated the hearing. For
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the reasons set forth below, the Court GRANTS plaintiff’s motion to remand.
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BACKGROUND
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On July 6, 2011, plaintiff Robert Mendala filed a verified complaint in Mendala v. Irene
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Cheung, et al, Case No. CGC-11-512243, against defendants Irene Cheung and Tiempo Interiors, Inc.,
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alleging a variety of claims arising from plaintiff’s termination from defendant’s company. One of the
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claims alleged that defendants diverted plaintiff’s 401(k) funds, a claim the defendants characterized
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as a federal ERISA claim. On September 16, 2011, defendants sent plaintiff a letter notifying him that
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they would remove the case to federal court based on the 401(k) claim. Cha Decl., Ex. D. On
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September 29, 2011, plaintiff offered to stipulate to delete any alleged ERISA claims from the
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complaint.1 Flautt Decl., ¶ 4. Defendants rejected the offer and removed the case on October 3, 2011.

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Plaintiff’s proposed mechanism to delete the allegations was a stipulation to an order of the
Superior Court striking such allegations; that mechanism was apparently an attempt to preserve
plaintiff’s right to amend his complaint “of course”.

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On November 1, 2011, plaintiff filed an amended complaint withdrawing all allegations identified by

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defendants as supporting federal subject matter removal jurisdiction. On November 18, 2011, plaintiff

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filed this motion to remand. Defendants oppose. Defendants do not dispute that no federal claims

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remain in the complaint, but argue that the Court should exercise discretionary jurisdiction over the case.

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LEGAL STANDARD
When a case "of which the district courts of the United States have original jurisdiction" is

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initially brought in state court, the defendant may remove it to federal court. 28 U.S.C. § 1441(a). Upon

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a defendant's removal of a case to federal court, the court "shall have supplemental jurisdiction over all

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United States District Court
For the Northern District of California

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other claims that . . . form part of the same case or controversy." 28 U.S.C. § 1367(a). However, if the

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court chooses, it may in its discretion "remand all matters in which State law predominates." 28 U.S.C.

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§ 1441(c). A district court has the discretion to remand a properly removed case to state court when no

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federal claim remains, "upon a proper determination that retaining jurisdiction over the case would be

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inappropriate." Carnegie-Mellon University v. Cohill, 484 U.S. 343, 357 (1988); Harrell v. 20th

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Century Ins. Co., 934 F.2d 203, 205 (9th Cir. 2001). In deciding whether to remand, courts should

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"consider and weigh . . . the values of judicial economy, convenience, fairness, and comity[.]"

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Carnegie-Mellon, 484 U.S. at 350. The Supreme Court in Carnegie-Mellon noted that a district court

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has "a powerful reason to choose not to continue to exercise jurisdiction" when all federal claims have

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been eliminated at an early stage of the litigation. Carnegie-Mellon, 484 U.S. at 350-51.

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DISCUSSION

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The Court agrees with plaintiff that remand is the proper disposition of this case. Plaintiff

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amended his complaint to remove all federal claims early in this litigation. With respect to judicial

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economy, no pleadings (other than this motion) have been filed in federal court, nor have any hearings

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been held; indeed, the parties have not yet attended a case management conference in federal court. See

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Bologna v. City and County of San Francisco, 2009 U.S. Dist. LEXIS 89289 (N.D.Cal. 2009) (Illston,

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J.) The remaining claims are all state law causes of action; comity therefore weighs in favor of allowing

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San Francisco Superior Court to decide these issues. Millar v. Bay Area Rapid Transit Dist., 236 F.
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Supp. 2d 1110, 1120 (N.D. Cal. 2002) (Brazil, J.) (it is “preferable as a matter of comity (respect for our

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sister state institutions) for state court judges to apply state law to plaintiff's state-law claims.”)

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Defendant argues that plaintiff engaged in “forum manipulation” by waiting until the “last

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possible moment” to offer a stipulation striking the federal claims. The Court disagrees; even had

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plaintiff never offered to stipulate removal of the federal claims, they could properly request remand

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upon amendment of their complaint. See East Bay Drivers Association v. Surinder Kaur, 2003 U.S.

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Dist. LEXIS 9747, at *5 (N.D.Cal. 2003) (Illston, J.) (“Filing federal claims in a state court is a

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‘legitimate tactical decision’ which allows for the option of requesting a remand with all due speed

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should the defendants exercise their choice to remove.”) The Carnegie-Mellon factors weigh in favor

United States District Court
For the Northern District of California

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of remand.

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Defendants alternatively argue that the Court should at least retain jurisdiction of this case until

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it can consider defendants’ Fed. R. Civ. P. Rule 11 motion for sanctions. However, defendants have not

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yet filed any such motion. Fairness does not dictate retaining jurisdiction over a case based on the

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intention of a party to file a motion. Moreover, equivalent procedures to Rule 11 motions that provide

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parallel remedies exist in state court, under California Code of Civil Procedure § 128.7. See Thornton

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v. Solutionone Cleaning Concepts, Inc., 2007 WL 210586, at *2 (E.D.Cal. 2007) (Section 128.7

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“basically mirrors” Rule 11 and “deals with imposing sanctions for filing frivolous lawsuits.”)

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Defendants may file their motion pursuant to Section 128.7 in state court.

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The Court therefore GRANTS plaintiff’s motion for remand.

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IT IS SO ORDERED.

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Dated: December 19, 2011
SUSAN ILLSTON
United States District Judge

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