Rojas et al v. Ygrene Energy Fund Inc. et al

Filing 7

Dismissal Without Prejudice for Lack of Subject Matter Jurisdiction. Signed by Judge Cathy Ann Bencivengo on 4/10/2018.(jjg)(sjt).

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA
MARTHA ROJAS and ROGER ROJAS,

Case No.: 18-CV-579 CAB KSC

Plaintiff,

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v.

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DISMISSAL WITHOUT PREJUDICE
FOR LACK OF SUBJECT MATTER
JURISDICTION

YGRENE ENERGY FUND, INC. et al.,

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Defendant.

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This matter is before the Court on an order to show cause as to subject matter

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jurisdiction. The complaint alleges federal question jurisdiction based solely on a claim

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for violation of Title 16, section 429.1, of the Code of Federal Regulations, and

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supplemental jurisdiction over the eight state law claims. However, “[t]o acquire federal

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jurisdiction, a plaintiff must assert a colorable right to a remedy under a particular federal

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statute.” Carlson v. Coca-Cola Co., 483 F.2d 279, 280 (9th Cir. 1973). Title 16, section

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429.1, of the Code of Federal Regulations was promulgated pursuant to the Federal Trade

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Commission Act (the “FTCA”). See Part 429--Cooling-Off Period for Door-to-Door Sales:

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Promulgation of Trade Regulations Rule and Statement of Its Basis and Purpose, 37 Fed.

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Reg. 22934-35 (Oct. 26, 1972).

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Carlson, 483 F.2d at 280; O’Donnell v. Bank of Am., Nat’l Ass’n, 504 Fed. Appx. 566, 568

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(9th Cir. 2013) (“[T]he Federal Trade Commission Act . . . doesn’t create a private right of

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action.”); 5 McCarthy on Trademarks and Unfair Competition § 27:119 (5th ed.) (“While

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it has often been argued that a private right to sue for a violation of the FTC Act’s

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prohibitions should be implied, the courts have consistently held that there is no such

The FTCA does not create a private right of action.

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18-CV-579 CAB KSC

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private right to sue. That is, only the FTC, as a federal agency, has the power to issue cease

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and desist orders, obtain civil penalties, or file suit for violation of the FTC Act.”). Thus,

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“it follows that there is no private right of action to enforce the FTC’s promulgated 16

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C.F.R. § 429.1.” Howard v. Burleson Servs., Inc., No. 616CV300ORL18TBS, 2017 WL

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1862212, at *2 (M.D. Fla. May 8, 2017). If there is no private right of action to enforce 16

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C.F.R. § 429.1, Plaintiffs have not asserted a colorable right to a remedy under a federal

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statute, meaning the Court lacks subject matter jurisdiction over this lawsuit.

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In their response to the Court’s order to show cause, Plaintiffs fail to cite to any

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federal court cases holding that consumers have a private right of action under 16 C.F.R. §

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429.1 or the FTCA in general. That regulations enacted pursuant to the FTCA provide

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benefits or rights to consumers does not necessarily mean that consumers have a right to

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sue to enforce such regulations, regardless of whether the relief sought is equitable or

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monetary. Only the FTC has the power to file suit for violation of those regulations. See

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5 McCarthy on Trademarks and Unfair Competition § 27:119 (5th ed.).

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In sum, there is no private right of action to sue for violation of the FTC Act. This

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prohibition includes regulations promulgated pursuant to the FTC Act. Plaintiffs cite to no

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authority to the contrary. Plaintiffs first claim for violation of 16 C.F.R. § 429.1, therefore,

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does not assert a colorable right to a remedy obtainable by Plaintiffs via this lawsuit and

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cannot serve as a basis for federal question subject matter jurisdiction. Because Plaintiffs

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do not assert any other federal claims and because the lack of diversity between Defendants

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and Plaintiffs precludes the exercise of diversity jurisdiction, the Court lacks subject matter

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jurisdiction over Plaintiffs’ complaint.

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WITHOUT PREJUDICE to refiling in state court.

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Accordingly, the complaint is DISMISSED

It is SO ORDERED.
Dated: April 10, 2018

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