Lopez v. The Hillshire Brands Company et al

Filing 41

ORDER by Magistrate Judge Jacqueline Scott Corley denying 32 Motion for Attorney Fees. (ahm, COURT STAFF) (Filed on 6/1/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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LANETTE LOUISE LOPEZ, et al.,
Plaintiffs,

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Case No. 16-cv-00371-JSC
ORDER DENYING PLAINTIFFS’
MOTION FOR ATTORNEYS’ FEES

v.
ALLIED PACKING & SUPPLY INC., et al.,

Re: Dkt. No. 32

Defendants.

United States District Court
Northern District of California

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Federal law, 28 U.S.C. section 1446(c), prohibits removal based on diversity jurisdiction

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“more than 1 year after commencement of the action.” Nearly two years after this action was

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filed, Defendant the Hillshire Brands Company (“Hillshire”) removed this action to this Court

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from the Alameda County Superior Court based on diversity jurisdiction. Hillshire argued that

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the amendment of Plaintiffs’ state court personal injury action into a wrongful death action

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“commenced a new action” re-starting the 1-year clock for diversity removal. The Court disagreed

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and granted Plaintiffs’ motion to remand. (Dkt. No. 27.) Shortly thereafter, Plaintiffs filed the

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underlying motion for attorneys’ fees seeking $85,203.75. (Dkt. No. 32.) After carefully

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considering the arguments and briefing submitted, the Court concludes that oral argument is

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unnecessary, see Civ. L.R. 7-1(b), and DENIES the motion for attorneys’ fees.

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DISCUSSION
Under § 1447(c), a district court has discretion to “require payment of just costs and any

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actual expenses, including attorney fees, incurred as a result of [improper] removal.” 28 U.S.C. §

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1447(c). “The appropriate test for awarding fees under § 1447(c) should recognize the desire to

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deter removals sought for the purpose of prolonging litigation and imposing costs on the opposing

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party, while not undermining Congress’ basic decision to afford defendants a right to remove as a

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general matter, when the statutory criteria are satisfied.” Martin v. Franklin Capital Corp., 546

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U.S. 132, 140 (2005). A finding of bad faith on the part of the removing party is not required.

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Moore v. Permanente Med. Grp., Inc., 981 F.2d 443, 447-48 (9th Cir. 1992). Instead, “the

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standard for awarding fees should turn on the reasonableness of the removal.” Martin, 546 U.S. at

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141. “Absent unusual circumstances, courts may award attorney’s fees under § 1447(c) only

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where the removing party lacked an objectively reasonable basis for seeking removal.” Id.

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“Conversely, when an objectively reasonable basis exists, fees should be denied.” Id.
Hillshire removed this action from state court more than 20 months after it was initiated

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when Plaintiffs Lanette Lousie Lopez, Pilar Elann Lopez, and Seth Vincent Lopez’s (collectively

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“Plaintiffs”) filed a second amended complaint converting the action into one alleging survival
and wrongful death claims following the death of their husband and father, respectively. Hillshire

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United States District Court
Northern District of California

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argued that the amendment of a personal injury complaint in California state court to add a

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wrongful death cause of action upon the death of the original plaintiff constituted the

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“commencement of [a new] action” re-setting the one-year clock for removal under. 28 U.S.C. §

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1446(c). Plaintiffs contend that removal on this basis was not objectively reasonable because

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Hillshire’s arguments were contrary to California law regarding wrongful death and survival

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actions. Because Hillshire’s removal position was not unreasonable, the Court declines to award

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fees.

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First, Hillshire’s removal argument, while ultimately unpersuasive, was novel. There is no

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case within the Ninth Circuit which addresses the precise issue raised. The Court concluded that

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McAtee v. Capital One, F.S.B., 479 F.3d 1143, 1148 (9th Cir. 2007) controlled, but Hillshire’s

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arguments to the contrary were not frivolous. McAtee was decided under the Class Action

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Fairness Act rather than state law wrongful death and survival statutes. Although the Court

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concluded that this distinction was immaterial, this was not such an obvious conclusion that the

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Court can say that Hillshire’s removal position was objectively unreasonable. Indeed, Plaintiffs

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did not even cite McAtee as authority for remand until their reply. Instead, Plaintiffs spent

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considerable space in their remand motion arguing that the Court should follow the rationale of

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two out-of-circuit Eastern District of Louisiana District Court decisions. See, e.g., Turner v. Mine

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Safety Appliances Co., No. 01-0325, 2001 U.S. Dist. LEXIS 5965 (E.D. La. Apr. 27, 2001);
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Rodriguez v. Acands, Inc., No. 01-0586, 2001 U.S. Dist. LEXIS 4386 (E.D. La. 2001). This was

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thus not a case where removal was clearly improper because other district courts within the Ninth

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Circuit had considered and rejected the very arguments Hillshire advanced. Compare Braco v.

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MCI Worldcom Communications, Inc., 138 F. Supp. 2d 1260 (C.D. Cal. 2001) (awarding

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attorneys’ fees, even though defendant had stated a plausible basis for removal, because defendant

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had unsuccessfully removed on the same basis in two prior actions) with Plute v. Roadway

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Package Sys., Inc., 141 F. Supp. 2d 1005, 1012 (N.D. Cal. 2001) (concluding that “an award of

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costs and fees is not warranted in this case, given that the removal was based on a reasonable and

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supported interpretation of unsettled California law.”).

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Second, the amount of fees sought here undercuts Plaintiffs’ argument that Hillshire’s

United States District Court
Northern District of California

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removal position was without merit. Plaintiffs seek $67,778.75 in fees (for 121.55 hours of work)

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for the motion to remand and another $17,425.00 for the motion for fees. This amount is well

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above the amount of fees typically sought in connection with motions to remand, see, e.g.,

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Cuellar-Ramirez v. US Foods, Inc., No. 16-CV-00085-RS, 2016 WL 1238603, at *7 (N.D. Cal.

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Mar. 22, 2016) (denying request for $6,600 in fees); Portillo v. Beyer Fin. Corp., No. 15-CV-

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04493-RS, 2015 WL 7738029, at *4 (N.D. Cal. Dec. 1, 2015) (awarding $10,537.50 in fees and

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costs), and thus suggests that the issues presented were not objectionably unreasonable, otherwise

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there would be no need for Plaintiffs to incur so much attorney time in briefing the issues.

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“[R]emoval is not objectively unreasonable solely because the removing party’s arguments

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lack merit, or else attorney’s fees would always be awarded whenever remand is granted.” Lussier

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v. Dollar Tree Stores, Inc., 518 F.3d 1062, 1065 (9th Cir. 2008). Although Hillshire’s removal

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position was not availing, it was not objectively unreasonable. Plaintiffs’ motion for attorneys’

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fees is thus denied.

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This Order disposes of Docket No. 32.

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IT IS SO ORDERED.

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Dated: June 1, 2016

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JACQUELINE SCOTT CORLEY
United States Magistrate Judge

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