Saberi v. Les Stanford Chevrolet Cadillac Inc. et al

Filing 31

ORDER by Judge Yvonne Gonzalez Rogers granting 17 Motion to Remand. Plaintiff's request for attorney's fees and costs is Denied. Action is REMANDED to Superior Court of California for the County of San Mateo. Signed by Judge Yvonne Gonzalez Rogers on 6/16/16. (fs, COURT STAFF) (Filed on 6/16/2016)

1
2
3
4

UNITED STATES DISTRICT COURT

5

NORTHERN DISTRICT OF CALIFORNIA

6
7

ANDY SABERI,

Case No. 16-cv-02203-YGR

Plaintiff,
8
v.

ORDER GRANTING MOTION TO REMAND

9
LES STANFORD CHEVROLET CADILLAC
INC., ET AL.,

11
United States District Court
Northern District of California

10

Re: Dkt. No. 17

Defendants.
This case arises out of plaintiff Saberi’s purchase of a new vehicle from defendant Les

12
13

Stanford Chevrolet Cadillac (“Les Stanford”), and the delivery of said vehicle from Michigan to

14

California by defendants BJ Interstate Auto Transporters, Inc. (“BJ Interstate”) and Bogdan Dedyk

15

d/b/a Safe Auto Transport (“Dedyk”). (Dkt. 1-1, “Compl.”) The case was removed to federal

16

court by defendant Les Stanford on April 22, 2016. (Dkt. No. 1.)

17

Now before the Court is plaintiff’s Motion to Remand. (Dkt. No. 17, “Mtn.”) Defendant

18

Les Stanford has filed a response in opposition to plaintiff’s Motion, (Dkt. No. 24, “Opp’n”), and

19

plaintiff has filed a reply, (Dkt. No. 28, “Reply”).1 For the reasons set forth below, the Court

20

REMANDS the action to the state court.2

21
22

I.

BACKGROUND
Plaintiff is an individual residing in San Mateo County, California. (Compl. ¶ 1.) On or

23

about September 17, 2015, Plaintiff purchased a Corvette from defendant Les Stanford, which is a

24

Michigan corporation with its principal place of business in Michigan, for delivery to plaintiff in

25
1

26
27
28

The Court VACATES the hearing currently set on this Motion for June 21, 2016, and
issues this Order without oral argument from the parties.
2

Because the Court is remanding the action to the state court, the Court also VACATES the
hearing on defendant’s motion to dismiss (Dkt. No. 13) currently set for June 21, 2016.

San Francisco, California. (Id. at ¶¶ 2, 9.) According to the Complaint, defendant Les Stanford

2

contracted with defendant BJ Interstate “for the purpose of transporting the Corvette for delivery

3

to [plaintiff].” (Id. at ¶ 8.) Defendant BJ Interstate is a Nevada corporation with its principal

4

place of business in Nevada. (Id. at ¶ 3.) Plaintiff alleges that defendant BJ Interstate, in turn,

5

subcontracted with defendant Dedyk, who is an individual residing in Roseville, California, “for

6

the purpose of transporting the Corvette for delivery to [plaintiff] in San Francisco, California.”

7

(Id. at ¶¶ 4, 9.) Plaintiff alleges that, based on his reliance on certain warranties and

8

representations, he “made full payment in the sum of $128,391.93” to defendant Les Stanford for

9

the Corvette. (Id. at ¶ 10.) According to the Complaint, upon delivery of the Corvette on or about

10

October 13, 2015, plaintiff “discovered that the Corvette was defective and not safe for reasonable

11
United States District Court
Northern District of California

1

operation” and that the “Corvette was in fact unmerchantable and unfit to be operated.” (Id. at ¶¶

12

11–12.)
Plaintiff believes that the defendants “proximately caused the damaged to the Corvette.”

13
14

(Id. at ¶ 14.) Plaintiff filed his complaint in California state court on November 18, 2015 alleging

15

the following: (i) violation of California’s Song-Beverly Consumer Warranty Act against

16

defendant Les Stanford for delivering a defective automobile; (ii) fraud against all defendants for

17

misrepresenting that the automobile was of merchantable quality and fit for driving and operation;

18

and (iii) negligence against all defendants for breaching their duty of care not to damage the

19

automobile. (Id. at ¶¶ 17–27.)

20

II.

DISCUSSION

21

A.

22

Federal courts are courts of limited jurisdiction. Kokkonen v. Guardian Life Ins. Co. of

Legal Standard

23

Am., 511 U.S. 375, 377 (1994) (federal courts “possess only that power authorized by Constitution

24

and statute”). A defendant may remove a civil action from state court if the action could have

25

originally been filed in federal court. 28 U.S.C. § 1441. Federal subject matter jurisdiction under

26

28 U.S.C. § 1332(a)(1) requires complete diversity of citizenship and an amount in controversy in

27

excess of $75,000. Federal subject matter jurisdiction under 28 U.S.C. § 1331 requires a civil action to

28

arise under the constitution, laws, or treaties of the United States. A claim “arises under” federal law

2

1

only if a “well-pleaded complaint” alleges a cause of action based on federal law—“an actual or

2

anticipated defense” does not confer federal jurisdiction. Vaden v. Discover Bank, 556 U.S. 49, 60

3

(2009). “The presence or absence of federal-question jurisdiction is governed by the ‘well-pleaded

4

complaint rule,’ which provides that federal jurisdiction exists only when a federal question is

5

presented on the face of the plaintiff’s properly pleaded complaint.” Wayne v. DHL Worldwide

6

Express, 294 F.3d 1179, 1183 (9th Cir. 2002) (quoting Caterpillar, Inc. v. Williams, 482 U.S. 386, 392

7

(1987)).

8
9

The defendant seeking removal “bears the burden of establishing that removal is proper” and
the “removal statute is strictly construed against removal jurisdiction.” Provincial Gov’t of
Marinduque v. Placer Dome, Inc., 582 F.3d 1083, 1087 (9th Cir. 2009); see also Shamrock Oil & Gas

11
United States District Court
Northern District of California

10

Corp. v. Sheets, 313 U.S. 100, 108–09 (1941). A plaintiff may seek to have a case remanded to

12

the state court from which it was removed if the district court lacks jurisdiction or if there is a

13

defect in the removal procedure. 28 U.S.C. § 1447(c).

14

There is typically a strong presumption against finding removal jurisdiction. Gaus v.

15

Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). The burden of establishing federal jurisdiction for

16

purposes of removal is on the party seeking removal. See Valdez v. Allstate Ins. Co., 372 F.3d

17

1115, 1117 (9th Cir. 2004). The party seeking removal “has the burden to prove, by a

18

preponderance of the evidence, that removal is proper.” Geographic Expeditions, Inc. v. Estate of

19

Lhotka, 599 F.3d 1102, 1107 (9th Cir. 2010).

20

Further, when a case is removed to federal court, the court has an independent obligation to

21

satisfy itself that it has federal subject matter jurisdiction. Valdez, 372 F.3d at 1116. A case removed

22

to federal court must be remanded back to state court “if at any time before final judgment it appears

23

that the district court lacks subject matter jurisdiction.” 28 U.S.C. § 1447(c). “Federal jurisdiction

24

must be rejected if there is any doubt as to the right of removal in the first instance.” Gaus, 980

25

F.2d at 566; accord Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir.

26

2003). The court “resolves all ambiguity in favor of remand to state court.” Hunter v. Philip

27

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

28

Here, plaintiff argues that remand is appropriate because: (a) defendant’s notice of
3

1

removal contained several procedural deficiencies; (b) there is no federal question that would give

2

the court jurisdiction; and (c) even if defendant had properly removed on the basis of diversity,

3

there is no complete diversity in this case.

4

B.

5

As a threshold matter, “[a]ll defendants who have been ‘properly . . . served in the action’

Discussion

6

must join a petition for removal.” Destfino v. Reiswig, 630 F.3d 952, 956 (9th Cir. 2011) (citing

7

Emrich v. Touche Ross & Co., 846 F.2d 1190, 1193 n.1 (9th Cir. 1988)). “In cases removed

8

pursuant to Sections 1441(a) and (b) of Title 28 and in other removals as to which Congress has

9

not otherwise provided, all of the defendants in the state court action must consent to the
removal.” 14 Wright & Miller, Federal Practice and Procedure § 3730 (4th ed.). “A narrow

11
United States District Court
Northern District of California

10

exception to the unanimity rule is recognized where removal consent is not obtained from

12

‘nominal, unknown[,] or fraudulently joined parties.’” Hafiz v. Greenpoint Mrtg. Funding, Inc.,

13

652 F. Supp. 2d 1050, 1052 (N.D. Cal. 2009) (quoting United Comput. Sys., Inc. v. AT&T Corp.,

14

298 F.3d 756, 762 (9th Cir. 2002)). “A defendant is a nominal party where his role is limited to

15

that of a stakeholder or depositary.” Hewitt v. Stanton, 798 F.2d 1230, 1233 (9th Cir. 1986).3

16

There is no contention here that defendant obtained the consent of all defendants who have

17

been served in this action. Defendant Les Stanford was only able to obtain the consent of

18

defendant BJ Interstate, as averred in defendant Les Stanford’s notice of removal. Defendant Les

19

Stanford’s only response is that, because a default has been entered against defendant Dedyk, his

20

consent, or lack thereof, should not be relevant for the purposes of removal. Defendant Les

21
22
23
24
25
26
27
28

3

Defendant also argues that consent of all defendants is not required where removal of the
action is proper based on diversity of citizenship. Not so. Courts have applied the rule requiring
consent of all defendants in both federal question and diversity cases. See 14 Wright & Miller,
Federal Practice and Procedure § 3730 (4th ed.); see also Destfino, 630 F.3d at 956–57
(recognizing applicability of consent rule to federal question removal); Cucci v. Edwards, 510 F.
Supp. 2d 479, 484 (C.D. Cal. 2007) (applying consent rule to diversity removal); 625 3rd St.
Assocs., LP v. Alliant Credit Union, No. 09-cv-00564, 2009 WL 1139592, at *2–3 (N.D. Cal. Apr.
28, 2009) (applying consent rule as a threshold question in motion to remand removal based on
both federal question and diversity); Boyett, 2014 WL 2093569, at *1 (applying consent rule to
diversity removal and noting that Section 1441(b) “merely provides additional rules for diversityjurisdiction removals under [section] 1441(a)” and therefore the “removal is construed as one
under [section] 1441(a)”).
4

1

Stanford, however, cites no authority for such a proposition.

2

Although the Ninth Circuit has yet to address this issue, the Seventh Circuit addressed a

3

similar issue in In re Amoco Petroleum Additives Co., 964 F.2d 706 (7th Cir. 1992). In Amoco,

4

the Seventh Circuit was petitioned for a writ of mandamus to review a district court’s decision to

5

remand the case to state court because of a defect in the removal procedure, namely the failure to

6

obtain the consent of all defendants. Id. at 711–12. The Seventh Circuit held that review was

7

precluded by 42 U.S.C. § 1447(d), which bars review of remands based on procedural defects. Id.

8

at 713. In so holding, the Seventh Circuit explained that “removal requires a petition joined by all

9

defendants” and that although the defendants refusing to consent to removal had “refused to
respond to [the] demand for arbitration” or “to answer the complaint,” the rule still required them

11
United States District Court
Northern District of California

10

to consent to the removal. Id. at 711 (noting that an “obdurate litigant is not on that account a

12

nominal one” for the purposes of the rule requiring consent for removal). The majority of district

13

courts to have addressed this issue have held the same. See City of Los Angeles v. Hamada, Inc.,

14

No. 12-cv-07029, 2012 WL 4951192, at *2 (C.D. Cal. Oct. 16, 2012) (defaulting defendant was

15

required to consent to removal); Am. Asset Fin., LLC v. Corea Firm, 821 F. Supp. 2d 698, 700–01

16

(D.N.J. 2011) (requiring consent from defaulted defendants even where defendants “made no

17

appearances for any purpose in either state or federal court”); GMFS, L.L.C. v. Bounds, 275 F.

18

Supp. 2d 1350, 1353 (S.D. Ala. 2003) (remanding case where defaulted defendants did not

19

consent); Alanis v. Wells Fargo Nat’l Ass’n, No. 11-cv-800, 2012 WL 113725, at *2–3 (W.D. Tex.

20

Jan. 12, 2012) (remanding case for failure to obtain consent from defaulted defendant and noting

21

that vast majority of cases agrees that consent from defaulted defendants is required) (citing

22

cases); cf. Schlegle & Sons Printing v. United English Breeders & Fanciers Ass’n, Inc., 682 F.

23

Supp. 36, 37 (C.D. Ill. 1988) (holding that defaulted defendant was not a nominal party for

24

jurisdictional purposes). In light of the Seventh Circuit’s decision and that of the majority of other

25

district courts, the Court similarly finds that a defendant’s default is not a sufficient reason for

26

failing to obtain the consent of all defendants for the purposes of removal. 4

27
4

28

The Court is aware of only one case in which a court, faced with a non-consenting
defendant who had defaulted, found the removal to be proper given that plaintiffs also
5

1

Thus, the Court finds that Les Stanford has not sufficiently shown why removal was proper

2

here given defendant Dedyk’s lack of consent. Accordingly, the Court GRANTS plaintiff’s motion

3

to remand the case. 5

4

III.

ATTORNEY’S FEES
Plaintiff asks for attorney’s fees in defending against the removal action, pursuant to 28

5
6

U.S.C. § 1447(c), which provides that an “order remanding the case may require a payment of just

7

costs and any actual expenses, including attorney fees, incurred as a result of the removal.” (Mtn.

8

10–11 (citing 28 U.S.C. § 1447(c)).) The Court declines and hereby DENIES plaintiff’s request for

9

attorney’s fees and costs.

10

IV.

CONCLUSION

United States District Court
Northern District of California

11

Plaintiff’s motion to remand is GRANTED. Plaintiff’s request for attorney’s fees and costs

12

is DENIED. The above-captioned action is hereby REMANDED to the Superior Court of California

13

for the County of San Mateo forthwith, and the Clerk is ORDERED to close the action.

14
15

IT IS SO ORDERED.
Dated: June 16, 2016
______________________________________
YVONNE GONZALEZ ROGERS
UNITED STATES DISTRICT COURT JUDGE

16
17
18
19
20
21
22
23

subsequently failed to serve the defaulting defendants with the amended complaint. See Cuen v.
Tucker, No. 09-cv-1904, 2009 WL 4049151, at *2 (S.D. Cal. Nov. 20, 2009).
5

24
25
26
27
28

In the alternative, defendant Les Stanford urges the Court to sever defendant Dedyk from
this action pursuant to Federal Rule of Civil Procedure 21 and allow the case against the two
diverse defendants to proceed in federal court. (Opp’n 6.) Courts have “used Rule 21 to drop a
party who was joined in an action for the purpose of preventing removal to a federal court.” 7
Wright & Miller, Federal Practice & Procedure § 1685 (3d ed.). However, there has been no
showing here that the joinder of defendant Dedyk was done for any such improper purpose, and it
appears from the Complaint that defendant Dedyk is a necessary party to the action. Accordingly,
the Court refuses to entertain defendant Les Stanford’s request that defendant Dedyk be severed to
prevent a remand.
6