Atyani, et al v. Bonfantine, et al

Filing 10

MEMORANDUM OPINION AND ORDER by District Judge William P. Johnson GRANTING 3 Motion to Remand to State Court and for Sanctions AS FURTHER DESCRIBED HEREIN. (mag)

Case 1:17-cv-00837-WJ-JHR Document 10 Filed 10/13/17 Page 1 of 8

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
______________________

HAILEY ATYANI, NICOLE CDE BACA,
BIANCA GARCIA, HANNAH JIRON,
CESELIA MERRYMAN, ANDREA
VARELA, WHITNEY WHITSON,
JAEDA CHAVEZ, JENNA ESPINOZA,
SAMANTHA HAWLEY, KRISTEN
HERRERA, EMILEE JEPHSON,
GENEVIEVE REILLY, KELSI SHARP,
SARA SCANNAPIECO, and ALLYNA
BOWSHER, on behalf of themselves
and all others similarly situated,
Plaintiffs,
v.

Case No. 17-CV-837 WJ-JHR

DENNIS BONFANTINE, JANICE
BONFANTINE, D.B. KELLY, INC.,
d/b/a KELLY’S BREW PUB AND
RESTAURANT, and DB BREWERY LLC,
Defendants.
MEMORANDUM OPINION AND ORDER
GRANTING PLAINTIFFS’ MOTION TO REMAND,
ORDER REMANDING CASE TO STATE COURT
and
AWARDING PLAINTIFFS’ REQUEST FOR SANCTIONS
FOR IMPROPER REMOVAL
THIS MATTER comes before the Court upon Plaintiffs’ Motion for Remand to State
Court and for Sanctions, filed August 22, 2017 (Doc. 3).

Having reviewed the parties’ briefs

and applicable law, the Court finds that Plaintiffs’ motion is meritorious and, therefore, is
granted. In addition, the Court is granting Plaintiffs’ request for sanctions in the form of attorney

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fees and costs incurred as a result of Defendants’ removal, subject to the proper filing
submissions as described below.
BACKGROUND
Plaintiffs are servers at Kelly’s Brew Pub & Restaurant in Albuquerque, New Mexico
and are suing their employer for work performed off-the-clock and enforcing an illegal tip-out
policy. This is a putative class action case under NMRA Rule 1-023(A). Plaintiffs filed this
lawsuit on November 11, 2016 in the Second Judicial District Court, County of Bernalillo; and
Defendants removed the case to federal court on August 16, 2017.
Plaintiffs seek to remand the case on the ground that there was no objectively reasonable
basis for federal removal because it is clear from the complaint and other pleadings that this case
does not allege a federal claim. Defendants contend that words used by Plaintiffs’ counsel in
other pleadings in this case indicate that Plaintiffs “seek to engraft the remedies under the Fair
Labor Standards Act –lock, stock and barrel—into this case, establishing federal question
jurisdiction. . . .” Doc. 6 at 1.
DISCUSSION
Under 28 U.S.C. §1331, federal district courts have original jurisdiction of all civil
actions arising under the Constitution, laws, or treaties of the United States. However, federal
courts are courts of limited jurisdiction; they are empowered to hear only those cases “authorized
and defined in the Constitution which have been entrusted to them under a jurisdictional grant by
Congress.” Henry v. Office of Thrift Supervision, 43 F.3d 507, 511 (10th Cir.1994) (citations
omitted).
I.

Whether Remand is Appropriate

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In order to establish federal question jurisdiction, the federal question must be “presented
on the face of the plaintiff’s properly pleaded complaint.” Caterpillar Inc. v. Williams, 482 U.S.
386, 392 (1987). Except for narrow circumstances not present here, a case may not be removed
to federal court solely because of a defense or counterclaim arising under federal law. Topeka
Housing Auth. v. Johnson, 404 F.3d 1245, 1247 (10th Cir.2005); see also Holmes Group, Inc. v.
Vornado Air Circulation Sys., Inc., 535 U.S. 826, 830-31 & n.2 (2002).

Generally, the

presumption is “against removal jurisdiction.” Laughlin v. Kmart Corp., 50 F.3d 871, 873 (10th
Cir. 1995). The removing party has the burden to demonstrate the appropriateness of removal
from state to federal court. McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 189
(1936); Martin v. Franklin Capital Corp., 251 F.3d 1284, 1290 (10th Cir. 2001) (a party seeking
to remove a case to federal court has the burden of demonstrating the existence of federal
jurisdiction). Thus, doubtful cases must be resolved in favor of remand. “If at any time before
final judgment it appears that the district court lacks subject matter jurisdiction, it shall be
remanded.” 28 U.S.C. § 1447(c) (emphasis added).
Defendants do not dispute that Plaintiffs’ Second Amended Complaint is based entirely
upon the Albuquerque Minimum Wage Ordinance (“MWO”), §13-12-1. The MWO has its own
remedial scheme which enables an aggrieved employee to recover the “balance of the wages
owed,” including interest, as well as “an additional amount equal to twice the wages owed . . .”
in addition to “other appropriate legal or equitable relief.” See, e.g., Ordinance §5(B), 13-125(B), Civil Enforcement.1 The sole basis for Defendants’ claim of federal jurisdiction is that in
an August 2, 2017, Response to Defendants’ latest Motion to Dismiss, Plaintiffs argued that the

Defendants inadvertently refer to the city ordinance as the “New Mexico Minimum Wage Ordinance” rather than
the “Albuquerque Minimum Wage Ordinance” although they cite to the correct ordinance. See Doc. 6 at 1.
1

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state court should look to judicial decisions interpreting the FLSA to interpret the similarly
worded MWO. See Doc. 1-11 at 61-69.2
There is no fair reading of Plaintiffs’ complaint which would suggest that this lawsuit
contains a federal question, see Doc. 1-5 (Second Am. Compl.), nor did Plaintiff ask the state
court to apply federal law to Plaintiffs’ claims. Plaintiffs’ comments in the pleadings referenced
by Defendants were obviously meant to demonstrate the parallel nature between remedies under
the Fair labor Standards Act (“FLSA”), 29 U.S.C. §201 et seq. and those provided by the MWO,
and Plaintiffs are seeking relief solely under the MWO, §13-12-5(B). Doc. 1-5 at 21.3 Merely
noting that a question of purely local law is informed by federal precedent does not convert the
question of municipal law into a federal question. Salman v. Arthur Andersen LLP, 375 F. Supp.
2d 1233, 1237 (D. N.M. 2005); Merrell Dow Pharmaceuticals Inc. v. Thompson, 478 U.S. 804,
813 (1986) (“the mere presence of a federal issue in a state cause of action does not
automatically confer federal-question jurisdiction.”).
For a case to arise under federal law, and thus come within federal question jurisdiction,
the federal question must be apparent on the face of a well-pleaded complaint, and plaintiff's
cause of action must be created by federal law, or, if it is a state-law cause of action, its
resolution must necessarily turn on a substantial question of federal law. 28 U.S.C.A. § 1331.
Rice v. Office of Servicemembers' Grp. Life Ins., 260 F.3d 1240 (10th Cir. 2001). Resolution of
Plaintiff’s claims asserted under the MWO does not turn on any question of federal law, and

2

The response to Defendants’ motion to dismiss and Plaintiffs’ motion for class certification are included as part of
the 708 pages of removal documents. It is not clear whether other pending motions are buried within these
documents, but in light of the Court’s ruling on the instant motion, that is a question that will not need to be
answered.
In their response to Defendants’ motion to dismiss, Plaintiffs had asked the state court to use federal precedent
interpreting the FLSA when determining Defendants’ obligations under the MWO, due to the similarity in wording
of the statutes and paucity of case law interpreting the MWO. See Doc. 1-11 at 65 (“The Albuquerque MWO tracks
generally with wording and intent of the [FLSA]”).
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looking to an analogous federal statute for interpretive guidance does not inject a federal cause of
action into the lawsuit. See Nicodemus v. Union Pac. Corp., 318 F.3d 1231 (10th Cir. 2003),
opinion reinstated in part, 440 F.3d 1227 (10th Cir. 2006) (Federal-question jurisdiction exists
where it appears that some substantial, disputed question of federal law is a necessary element of
one of well-pleaded state claims, but the mere presence of a federal issue in a state cause of
action does not automatically confer federal-question jurisdiction); cmp. Rains v. Criterion
Systems, Inc. et al, 80 F.3d 339 (9th Cir. 1996) (where plaintiff filed claim in state court for
wrongful discharge, and fact that same facts could have been basis for Title VII claim, did not
make claim into federal cause of action for purposes of removal).
II.

Whether Sanctions are Warranted
Plaintiffs seeks sanctions because Defendants lacked any objectively reasonable basis to

remove this case.
Under the federal remand statute, Plaintiffs may recover attorney fees and costs
associated with the removal and subsequent remand, should the Court determine that removal
was improper. “An order remanding the case may require payment of just costs and any actual
expenses, including attorney fees, incurred as a result of the removal.” 28 U.S.C. § 1447(c). The
standard for awarding fees turns on the reasonableness of the removal, and “absent unusual
circumstances, attorney's fees should not be awarded under § 1447(c) when the removing party
has an objectively reasonable basis for removal. Conversely, where no objectively reasonable
basis exists, fees should be awarded.” Martin v. Franklin Capital Corp., 546 U.S. 132, 132
(2005). A showing of bad faith is not a prerequisite to an award of fees and costs in conjunction
with an order to remand. Topeka Hous. Auth. v. Johnson, 404 F.3d 1245, 1248 (10th Cir. 2005);
Excell Inc. v. Sterling Boiler & Mechanical, Inc., 106 F.3d 318, 322 (10th Cir. 1997).

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Defendants expressly acknowledged that Plaintiff’s complaint is based solely on state
law, yet proceeded to try and convince the Court that this case should be removed because of
statements made by Plaintiffs in a response to a motion to dismiss in calling on analogous federal
law for guidance in interpretation where state law was silent. The standard for removal of a case
from state to federal court is very clear: it is based on the well-pleaded complaint. The Court
finds that Defendants’ removal was at best bogus and at worst a tactic to avoid a ruling on
Plaintiffs’ motion for class certification that was pending in state court by delaying the discovery
process. The Court is not prepared to pass on the issue of whether any bad faith was involved on
the part of Defendants’ motive in removing this case, nor is it necessary.4 However, the Court
can and shall make the finding that Defendants’ grounds for removal were not even remotely
based on the appropriate legal standard, and were therefore not objectively reasonable—to
reiterate: comments made by Plaintiffs in other pleadings about comparisons between MWO and
the FLSA as analogous statutes do not offer a plausible basis for removal. Having found that
Defendants’ removal lacked an objectively reasonable basis, Plaintiffs are entitled to sanctions
against Defendants in the form of attorney fees and costs incurred by Plaintiffs in connection
with the filing of the motion to remand.
Plaintiffs shall file with the Court a short, itemized request for attorney fees and costs,
with supporting affidavits and time records, within fourteen (14) days of the filing of this
Order. Defendants have the opportunity to respond within fourteen (14) days after the filing of
Plaintiffs’ submission. If Defendants or Plaintiffs desire for the Court to conduct a hearing on
the attorney fees and costs to be awarded to Plaintiffs, then a written request for hearing needs to

There is some evidence that Plaintiffs submit evidence that Defendants had scheduled a number of Plaintiffs’
depositions which were set almost on the day the case was removed to federal court, and cancelled just prior to that
time—after a considerable number of hours had been spent by Plaintiffs’ counsel in scheduling these depositions.
4

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be made by either Defendants or Plaintiffs. If no such request for a hearing is made, then the
Court shall decide the matter based on the written submissions of the parties.
CONCLUSION
In sum, the Court finds and concludes that Defendants have fallen abysmally short of
showing that a federal question has been presented on the face of Plaintiffs’ operative complaint
in this case, and as a result, the Court grants Plaintiffs’ Motion to Remand.
There is no need to address Plaintiffs’ alternative argument regarding the untimeliness of
removal, in light of the Court’s jurisdictional ruling.
The Court also finds and concludes that Defendants’ removal lacked an objectively
reasonable basis; therefore, Plaintiffs are entitled to sanctions against Defendants in the form of
attorney fees and costs associated with the filing of the motion to remand.
THEREFORE,
IT IS ORDERED that Plaintiffs’ Motion for Remand to State Court and for Sanctions
(Doc. 3) is hereby GRANTED for reasons described in this Memorandum Opinion and Order.
IT IS FURTHER ORDERED that Plaintiffs’ request for sanctions is hereby
GRANTED for reasons described in this Memorandum Opinion and Order.
IT IS FURTHER ORDERED that in connection with the award of sanctions, Plaintiffs
shall file with the Court a short, itemized request for attorney fees and costs, with supporting
affidavits and time records, within fourteen (14) days of the filing of this Order. Defendants
have the opportunity to respond within fourteen (14) days after the filing of Plaintiffs’
submission.

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IT IS FURTHER ORDERED that if either Defendants or Plaintiffs wish for the Court
to conduct a hearing on the amount of attorney fees and costs to be awarded Plaintiffs, then a
request for such a hearing needs to be made to the Court in writing.
IT IS FINALLY ORDERED that the Clerk of Court is hereby directed to take the
necessary action to have this case remanded to the Second Judicial District Court, State of New
Mexico, County of Bernalillo.

________________________________
UNITED STATES DISTRICT JUDGE

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