Deaguiar v. Whole Foods Market, Inc. et al
Filing
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ORDER ADOPTING IN PART AND MODIFYING IN PART THE FINDINGS AND RECOMMENDATION TO GRANT PLAINTIFF'S MOTION TO REMAND ACTION TO THE CIRCUIT COURT OF THE FIRST CIRCUIT, STATE OF HAWAII; ORDER DENYING WITHOUT PREJUDICE PLAINTIFF'S MOTION TO AMEN D COMPLAINT re 35 ; 36 - Signed by CHIEF JUDGE SUSAN OKI MOLLWAY on 10/16/12. " The court ADOPTS in part and MODIFIES in part the Findings and Recommendation to Grant Plaintiff's Motion to Remand Action to the Circuit Cour t of the First Circuit, State of Hawaii. To the extent DeAguiar seeks to remand this action based on the jurisdictional amount in controversy, his motion is denied." (emt, )CERTIFICATE OF SERVICEParticip ants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
HERBERT DEAGUIAR, Jr.,
)
)
Plaintiff,
)
)
vs.
)
)
WHOLE FOODS MARKET, INC.,
)
)
Defendant.
)
_____________________________ )
CIVIL NO. 12-00100 SOM-KSC
ORDER ADOPTING IN PART AND
MODIFYING IN PART THE
FINDINGS AND RECOMMENDATION
TO GRANT PLAINTIFF’S MOTION
TO REMAND ACTION TO THE
CIRCUIT COURT OF THE FIRST
CIRCUIT, STATE OF HAWAII;
ORDER DENYING WITHOUT
PREJUDICE PLAINTIFF’S MOTION
TO AMEND COMPLAINT
ORDER ADOPTING IN PART AND MODIFYING IN PART THE FINDINGS AND
RECOMMENDATION TO GRANT PLAINTIFF’S MOTION TO REMAND ACTION TO
THE CIRCUIT COURT OF THE FIRST CIRCUIT, STATE OF HAWAII; ORDER
DENYING WITHOUT PREJUDICE PLAINTIFF’S MOTION TO AMEND COMPLAINT
I.
INTRODUCTION.
Plaintiff Herbert DeAguiar, Jr., filed a wrongful
termination action against his former employer, Defendant Whole
Foods Market, Inc., in the Circuit Court of the First Circuit,
State of Hawaii.
See Civ. No. 12-1-0106-01 VLC, ECF No. 1-2.
DeAguiar asserts claims of unlawful age-discrimination in
violation of section 378-2(1)(A) of Hawaii Revised Statutes and
intentional infliction of emotional distress.
attorney’s fees.
He also seeks
See id.
Whole Foods removed the action to federal court under
28 U.S.C. §§ 1332(a)(1) and 1441(b).
See ECF No. 1.
On March 8, 2012, DeAguiar moved to amend his complaint
to substitute the allegedly correct defendant and to remand the
case to state court because the correct defendant would destroy
diversity of citizenship.
amount in controversy.
The motion did not challenge the
See ECF No. 9.
After extensive briefing, the Magistrate Judge issued
his Findings & Recommendation (“F&R”), recommending that this
court grant DeAguiar’s motion for remand to state court.
No. 35.
See ECF
The Magistrate Judge reasoned that the amount in
controversy did not exceed $75,000, as required for diversity
jurisdiction by 28 U.S.C. § 1332(a).
Id.
Because the Magistrate
Judge concluded that this court lacks subject matter
jurisdiction, he did not adjudicate DeAguiar’s request that
DeAguiar be allowed to amend the Complaint and that the action be
remanded based on the substitution of a new defendant.
Id.
Pursuant to Local Rules 7.2(d) and 74.2, the court
decides this matter without a hearing.
This court adopts the
F&R’s removal standard and the finding that DeAguiar and Whole
Foods are citizens of different states.
However, this court
modifies the F&R and determines that Whole Foods has proved by a
preponderance of the evidence that the amount in controversy
exceeds $75,000.
Accordingly, this court rejects the
recommendation in the F&R that this action be remanded for
failure to establish the required amount in controversy.
The
court denies the motion to amend and to remand, but this denial
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is without prejudice to DeAguiar’s raising of issues set out in
his original motion if he seeks rulings on those issues.1
II.
FACTUAL BACKGROUND.
DeAguiar is a resident of the City and County of
Honolulu, State of Hawaii.
See Complaint ¶ 2, ECF No. 1-2.
DeAguiar alleges that Whole Foods is a foreign for-profit
corporation doing business in the State of Hawaii.
Id. ¶ 3.
Whole Foods says it is a corporation incorporated under Texas law
and has its principal place of business in Texas.
See Notice of
Removal ¶ 4, ECF No. 1.
In August 2008, Whole Foods hired DeAguiar as its
Bakery Team Leader.
See Complaint ¶ 12.
In June 2010, Whole
Foods demoted DeAguiar to Assistant Bakery Team Leader.
¶ 13.
Id.
On December 13, 2010, Whole Foods terminated DeAguiar.
Id. ¶ 17.
DeAguiar filed a Charge of Discrimination with the
United States Equal Employment Opportunity Commission on March
1
DeAguiar has tried to preserve the option to claim more
than $75,000 while also arguing that this court should remand
this case for lack of subject matter jurisdiction. It is unclear
whether, in light of the present order, DeAguiar continues to
seek to amend his Complaint or to have this matter remanded. For
that reason, this court, while conscious that the merits of
DeAguiar’s original motion were never addressed, does not now
direct the Magistrate Judge to address those merits. DeAguiar is
free to revive his original motion if he so chooses, but it does
not make sense to this court to assume he so chooses and to
therefore refer the original motion back to the Magistrate Judge.
3
14, 2011, and, on November 5, 2011, received a Notice of Right to
Sue from the EEOC.
Id. ¶¶ 22-23.
On January 13, 2012, DeAguiar filed his Complaint in
the Circuit Court of the First Circuit, State of Hawaii, in Civ.
No. 12-1-0106-01 VLC.
See Complaint, ECF No. 1-2.
DeAguiar
asserts that Whole Foods discriminated against him based on his
age, in violation of section 378-2(1)(A) of Hawaii Revised
Statutes, and that Whole Foods intentionally inflicted emotional
distress on him by demoting and terminating him.
Id. ¶¶ 20-21.
The Complaint seeks damages for lost wages, benefits, and
emotional distress, as well as attorney’s fees.
Id. at 7.
DeAguiar did not specify the amount of damages sought.
See id.
On February 17, 2012, Whole Foods removed the action
under 28 U.S.C. §§ 1332(a)(1) and 1441(b).
Removal, ECF No. 1.
See Notice of
Whole Foods claimed that DeAguiar’s damages
exceeded $75,000, thereby satisfying the amount in controversy
requirement for diversity jurisdiction.
Whole Foods estimated
that DeAguiar would receive $56,000 for lost wages, $50,000 for
emotional distress damages, and $18,000 for attorney’s fees.
Id.
¶¶ 7-10.
On March 8, 2012, DeAguiar moved to amend his Complaint
and remand this case to state court.
The motion sought to delete
Whole Foods as a defendant and replace it with WFM Hawaii, LLC, a
limited liability company registered in the State of Hawaii.
4
See
ECF No. 9.
In a supplemental brief addressing the amount in
controversy, DeAguiar, claiming that his damages did not exceed
$75,000, estimated his lost wages at $54,280, offset by $29,068
in unemployment benefits.
See ECF No. 28, at 9.
DeAguiar
provided no dollar estimate of his emotional distress damages or
his attorney’s fees.
See id.
On June 7, 2012, the Magistrate Judge issued his F&R,
finding and recommending that this case be remanded because the
amount in controversy did not exceed $75,000.
See ECF No. 35.
In determining that the amount in controversy did not exceed
$75,000, the Magistrate Judge declined to include any dollar
amount for emotional distress damages, saying that any figure
would be speculative.
The F&R explained, “The fact is that
Plaintiff has not assigned a value to his emotional distress
damages.”
F&R at 11.
The Magistrate Judge found that DeAguiar’s
Complaint was only seeking $74,000 in damages, consisting of, at
most, $56,000 for lost wages and $18,000 for attorney’s fees.
See id. at 12.
In light of the F&R’s recommendation to remand,
the Magistrate Judge denied DeAguiar’s request to amend his
complaint.
On June 15, 2012, Whole Foods filed Objections to the
F&R, arguing that the Magistrate Judge improperly failed to
include emotional distress damages when determining the amount in
controversy.
See ECF. No. 36.
5
On October 4, 2012, this court held a telephone
conference with the parties to discuss whether DeAguiar was able
to clarify that he was seeking more than $75,000 in damages.
ECF No. 47.
See
DeAguiar ultimately informed the court that he is
not limiting his damages to $75,000 or less.
DeAguiar thus
appears to be seeking in excess of $75,000.
II.
STANDARD FOR OBJECTIONS TO FINDINGS AND
RECOMMENDATIONS.
This court reviews de novo those portions of an F&R to
which objection is made and may accept, reject, or modify, in
whole or in part, the F&R made by the Magistrate Judge.
In
examining the objections to an F&R, the court may receive further
evidence or recommit it to the Magistrate Judge with
instructions.
The court may accept those portions of the
Magistrate Judge’s F&R that are not objected to if it is
satisfied that there is no clear error on the face of the record.
See 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b); Local Rule
74.2; Int’l Longshore & Warehouse Union, Local 142, AFL-CIO v.
Foodland Super Market Ltd., 2004 WL 2806517, *1 (D. Haw. Sept.
15, 2004); Stow v. Murashige, 288 F. Supp. 2d 1122, 1127 (D. Haw.
2003), aff’d, 389 F.3d 880 (9th Cir. 2004); Abordo v. State of
Hawaii, 902 F. Supp. 1220 (D. Haw. 1995); see also Campbell v.
United States Dist. Court, 501 F.2d 196, 206 (9th Cir. 1974).
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III.
ANALYSIS.
Whole Foods removed this action pursuant to 28 U.S.C.
§§ 1441 and 1332(a)(1).
Section 1441 provides:
(a) Except as otherwise expressly provided by
Act of Congress, any civil action brought in
a State court of which the district courts of
the United States have original jurisdiction,
may be removed by the defendant or the
defendants, to the district court of the
United States for the district and division
embracing the place where such action is
pending. For purposes of removal under this
chapter, the citizenship of defendants sued
under fictitious names shall be disregarded.
(b) Any civil action of which the district
courts have original jurisdiction founded on
a claim or right arising under the
Constitution, treaties or laws of the United
States shall be removable without regard to
the citizenship or residence of the parties.
Any other such action shall be removable only
if none of the parties in interest properly
joined and served as defendants is a citizen
of the State in which such action is brought.
28 U.S.C. § 1441.
Section 1332(a)(1) provides, “The district courts shall
have original jurisdiction of all civil actions where the matter
in controversy exceeds the sum or value of $75,000 . . . and is
between . . . citizens of different States.”
28 U.S.C.
§ 1332(a)(1).
When a case is removed to federal court, there is a
strong presumption against federal court jurisdiction.
See
Durham v. Lockheed Martin Corp., 445 F.3d 1247, 1252 (9th Cir.
2006); Gaus v. Miles, 980 F.2d 564, 566 (9th Cir. 1992) (citing
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Nishimoto v. Federman–Bachrach & Assocs., 903 F.2d 709, 712 n.3
(9th Cir. 1990)).
A defendant who has removed a case bears the
burden of proving the propriety of removal, including
jurisdiction.
See Gaus, 980 F.2d at 566 (“The ‘strong
presumption’ against removal jurisdiction means that the
defendant always has the burden of establishing that removal is
proper.”).
“[J]urisdiction must be analyzed on the basis of the
pleadings filed at the time of removal without reference to
subsequent amendments.”
Sparta Surgical Corp. v. Nat’l Ass’n of
Sec. Dealers, Inc., 159 F.3d 1209, 1213 (9th Cir. 1998); Spencer
v. United States Dist. Court for the N. Dist. of Cal., 393 F.3d
867, 871 (9th Cir. 2004) (“Challenges to removal jurisdiction
require an inquiry into the circumstances at the time
the notice of removal is filed.”).
This court adopts the F&R’s finding that DeAguiar and
Whole Foods are citizens of different states and that Whole
Foods, not being a Hawaii citizen, was not barred by its
citizenship from removing this action.
§ 1441(b)(2).
See 28 U.S.C.
This court also adopts the F&R’s removal standard
set forth on page 4 of the F&R, as well as the law concerning the
determination of the amount in controversy, set forth on pages 6
to 8 of the F&R.
Accordingly, because the Complaint does not
demand a dollar amount, Whole Foods must prove by a preponderance
of the evidence that the amount in controversy exceeds $75,000.
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See Kroske v. U.S. Bank Corp., 432 F.3d 976, 980 (9th Cir. 2005).
Whole Foods does so.
The amount in controversy includes the amount of
damages in dispute, as well as attorney’s fees when authorized by
statute or contract.
Id.
When a complaint does not demand a
dollar amount, courts may consider facts in the removal petition
and may require the parties to submit evidence similar to that
submitted on a motion for summary judgment.
Id.
This evidence
may include interrogatory answers and emotional distress damage
awards in similar cases.
Id.
DeAguiar estimates his lost wages at $54,280, while
Whole Foods says lost wages total $56,000.
While DeAguiar
concedes that he received $29,068 in unemployment benefits, he
does not unequivocally say that he is therefore seeking from
Whole Foods lost wages totaling only the difference between
$56,000 (at most) and $29,068.
To the contrary, it appears he is
seeking $56,000 (at most) with the possibility of using $29,068
of that to satisfy any lien that the unemployment insurer might
have on his recovery.
When the estimated attorney’s fees of
$18,000 are added to lost wages of $56,000, the total rises to
$74,000.
This court turns then to the emotional distress claim.
In Kroske, the plaintiff filed an action in state court
against her former employer, U.S. Bank, asserting that U.S. Bank
had terminated her on the basis of her age in violation of a
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state law prohibiting age discrimination.
Id. at 979.
Kroske
sought, among other things, lost wages and benefits, and
emotional distress damages, but did not specify any amount of
damages.
Id.
U.S. Bank removed the case to federal court, and
the federal court awarded summary judgment to U.S. Bank on
Kroske’s claims.
Id.
Kroske appealed, arguing that U.S. Bank
had not meet its burden of establishing that the amount of
controversy exceeded $75,000.
Id.
The Ninth Circuit affirmed
the district court’s determination that, based on a preponderance
of the evidence, Kroske’s “emotional distress damages would add
at least an additional $25,000 to her claim.”
Id. at 980.
Even a modest award for emotional distress damages
would easily increase the amount in controversy in the present
case to over $75,000, given the alleged lost wages and attorney’s
fees authorized by statute.
In his supplemental brief on
damages, DeAguiar cited his interrogatory answers, which stated
that Whole Foods’ alleged actions have made him “afraid to make
decisions,” and to “fear women in higher authority.”
at 8.
ECF No. 28
He says he “could not sleep well or through the night” for
about nine months after he was fired.
Id.
While the Magistrate
Judge is correct in noting that no dollar figure is provided by
DeAguiar for emotional distress damages, it is not the case that
the court should therefore assign no value to the emotional
distress claim.
The description that DeAguiar provides of his
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alleged distress provides a basis on which this court can
conclude that DeAguiar is claiming more than $1,000 in emotional
distress damages.
Accordingly, the court denies the motion to
remand to the extent it is based on the argument that the amount
in controversy does not meet the jurisdictional amount.
IV.
CONCLUSION.
The court ADOPTS in part and MODIFIES in part the
Findings and Recommendation to Grant Plaintiff’s Motion to Remand
Action to the Circuit Court of the First Circuit, State of
Hawaii.
To the extent DeAguiar seeks to remand this action based
on the jurisdictional amount in controversy, his motion is
denied.
IT IS SO ORDERED.
DATED: Honolulu, Hawaii, October 16, 2012.
/s/ Susan Oki Mollway
Susan Oki Mollway
Chief United States District Judge
DeAguiar v. Whole Foods Market, Inc.; Civil No. 12-00100 SOM/KSC; ORDER ADOPTING IN
PART AND MODIFYING IN PART THE FINDINGS AND RECOMMENDATION TO GRANT PLAINTIFF’S MOTION
TO REMAND ACTION TO THE CIRCUIT COURT OF THE FIRST CIRCUIT, STATE OF HAWAII; ORDER
DENYING WITHOUT PREJUDICE PLAINTIFF’S MOTION TO AMEND COMPLAINT
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