1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 JANE DOE, individually and on ) Case No.: 3:21-cv-01587-BEN-DDL behalf of all others similarly situated, ) 12 ) ORDER: Plaintiff, 13 ) v. ) (1) DISMISSING DEFENDANT THE 14 ) UNITED STATES OF AMERICA NETGAIN TECHNOLOGY, LLC; 15 ) WITHOUT PREJUDICE; and UNITED STATES OF AMERICA; and ) 16 DOE DEFENDANTS 1-100, ) (2) REMANDING THE REMAINING 17 Defendants. ) CLAIMS TO STATE COURT ) 18 ) [ECF Nos. 23, 27] 19 I. INTRODUCTION 20 21 Plaintiff Jane Doe,1 individually and on behalf of all others similarly situated 22 (“Plaintiff”), brings this action for violation of federal and state law related to an alleged 23 data breach against Defendants Netgain Technology, LLC (“Netgain”) and the United 24 States of America (“United States”) (collectively, “Defendants”). Before the Court is: (1) 25 Plaintiff and the United States’ Joint Motion to Dismiss the United States, ECF No. 27; (2) 26 the United States’ Motion to Dismiss, ECF No. 23; and (3) Plaintiff’s request to remand to 27 1 California statutory law specifically allows a party to bring a lawsuit using a 28 1 state court the remaining state law claims. The United States’ Motion to Dismiss was 2 submitted on the papers without oral argument pursuant to Civil Local Rule 7.1(d)(1) and 3 Rule 78(b) of the Federal Rules of Civil Procedure. ECF No. 25. After considering the 4 papers submitted, supporting documentation, and applicable law, the Court: (1) GRANTS 5 the parties’ Joint Motion to Dismiss the United States without prejudice; (2) DENIES as 6 moot the United States’ Motion to Dismiss; and (3) REMANDS to state court the 7 remaining claims lodged against Netgain. 8 II. BACKGROUND 9 Plaintiff brings this class action lawsuit alleging state law violations of California’s 10 Confidentiality of Medical Information Act (“CMIA”) relating to a data breach involving 11 Plaintiff and Class members’ medical and personal information. See CAL. CIV. CODE §§ 12 56, et al. 13 A. Statement of Facts2 14 Plaintiff “was a patient of, received medical treatment and diagnosis from, and 15 provided her personal information, including her name, address, date of birth, social 16 security number, phone number and email address to . . . Neighborhood.”3 ECF No. 1-2 17 at 140–196 (“FAC”) at 145,4 ¶ 10. Plaintiff alleges that Neighborhood maintains an online 18 Patient Portal to allow patients to securely access and review their health information, as 19 well as to update their personal information. Id. at 149, ¶ 18. At all relevant times, 20 Neighborhood “maintained and continues to maintain ‘medical information,’ within 21 the meaning of [CMIA] . . . .” Id. at 150, ¶ 118. 22 23 2 The majority of the facts set forth are taken from the FAC and for purposes of ruling on the instant Motion to Dismiss, the Court assumes the truth of the allegations pled and 24 liberally construes all allegations in favor of the non-moving party. Manzarek v. St. Paul 25 Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). 3 The United States was substituted for Neighborhood Healthcare (“Neighborhood) as 26 a Defendant in this case on September 8, 2022, but Neighborhood is the Defendant referred 27 to in the FAC and Statement of Facts. See ECF No. 19. 4 Unless otherwise indicated, all page number references are to the ECF-generated 28 1 Plaintiff alleges that between October 22, 2020 and December 3, 2020, Defendants 2 failed “to properly maintain, preserve, and/or store confidential, medical and personal 3 identifying information of Plaintiff and all other persons similarly situated which allowed 4 an unauthorized person to gain access to” the information. Id. at 140 –141, ¶ 1. 5 Neighborhood and Netgain’s “negligent creation, maintenance, preservation and/or storage 6 of . . . the medical information . . . constituted a disclosure in violation of . . . [CMIA].” 7 Id. at 173–74, ¶¶ 96–98; 178, ¶¶ 118–20. Plaintiff maintains that she and the Class “have 8 the right to expect that the confidentiality of their medical information in possession 9 and/or derived from Defendants . . . be reasonably preserved and protected from 10 unauthorized viewing, exfiltration, theft, and/or disclosures.” Id. at 141, ¶ 1. Plaintiff 11 alleges she and the Class “fear that disclosure and/or release of their medical 12 information could subject them to harassment or abuse.” Id. at 173, ¶ 95. 13 B. Procedural History 14 On June 1, 2021, Plaintiff filed her initial class action lawsuit in state court against 15 Defendants Neighborhood, Netgain, and Health Center Partners of Southern California 16 (“Health Center Partners”). See generally ECF No. 1-2 at 4–47. Specifically, Plaintiff’s 17 Complaint sought damages, restitution, and injunctive relief for violations of: (1) CMIA, 18 California Civil Code sections 56, et seq., against all Defendants; (2) California’s Security 19 Notification Laws, California Civil Code section 1798.82, against Health Center Partners; 20 and (3) California’s Unfair Competition Law, California Business & Professions Code 21 sections 17200, et seq., against all Defendants. See id. On September 8, 2021, Plaintiff 22 filed her First Amended Class Action Complaint alleging the same causes of action against 23 the same Defendants. See generally FAC. 24 On September 9, 2021, Neighborhood removed this case to federal court based on 25 federal question jurisdiction and a federal defendant. ECF No. 1 at 1. Neighborhood 26 argued that it was immune from suit pursuant to 42 U.S.C. § 233(a) and that Plaintiff’s 27 exclusive remedy was against the United States under the Federal Tort Claims Act 28 (“FTCA”). See 28 U.S.C §§ 1346(b), 2672. Neighborhood subsequently filed a Motion to 1 Substitute the United States as a Defendant, and on September 8, 2022, the Court granted 2 Neighborhood’s Motion and substituted the United States as a Defendant in place of 3 Neighborhood. See ECF Nos. 3, 19. On September 9, 2022 Plaintiff voluntarily dismissed 4 Defendant Health Center Partners, leaving the United States and Netgain as the only 5 remaining Defendants in this litigation. 6 On November 7, 2022, the United States filed the instant Motion to Dismiss. ECF 7 No. 23 (“Motion”). On November 28, 2022, Plaintiff filed an Opposition to the Motion to 8 Dismiss. ECF No. 24 (“Oppo.”). The United States did not file a reply. On May 1, 2023, 9 Plaintiff and the United States filed a Joint Motion to Dismiss the United States from this 10 action without prejudice. ECF No. 27. 11 III. DISCUSSION 12 The United States’ original Motion to Dismiss argues that this Court lacks federal 13 jurisdiction, because Plaintiff failed to exhaust her administrative remedies pursuant to the 14 FTCA. See generally Motion. Plaintiff’s Opposition concedes that she did not exhaust her 15 administrative remedies but requests that if the Court dismisses the case, it do so without 16 prejudice. See generally Oppo. Plaintiff further requests that the remaining state law 17 claims against Netgain be remanded to state court. See id. Plaintiff and the United States 18 subsequently filed a Joint Motion asking the Court to dismiss the United States from this 19 litigation without prejudice. ECF No. 27. 20 A. Dismissal of the United States 21 Because the parties now agree to a dismissal of the United States without prejudice, 22 the United States’ original Motion to Dismiss, see ECF No. 23, is DENIED as moot. The 23 parties’ Joint Motion seeking dismissal of the United States, see ECF No. 27, is 24 GRANTED.
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 JANE DOE, individually and on ) Case No.: 3:21-cv-01587-BEN-DDL behalf of all others similarly situated, ) 12 ) ORDER: Plaintiff, 13 ) v. ) (1) DISMISSING DEFENDANT THE 14 ) UNITED STATES OF AMERICA NETGAIN TECHNOLOGY, LLC; 15 ) WITHOUT PREJUDICE; and UNITED STATES OF AMERICA; and ) 16 DOE DEFENDANTS 1-100, ) (2) REMANDING THE REMAINING 17 Defendants. ) CLAIMS TO STATE COURT ) 18 ) [ECF Nos. 23, 27] 19 I. INTRODUCTION 20 21 Plaintiff Jane Doe,1 individually and on behalf of all others similarly situated 22 (“Plaintiff”), brings this action for violation of federal and state law related to an alleged 23 data breach against Defendants Netgain Technology, LLC (“Netgain”) and the United 24 States of America (“United States”) (collectively, “Defendants”). Before the Court is: (1) 25 Plaintiff and the United States’ Joint Motion to Dismiss the United States, ECF No. 27; (2) 26 the United States’ Motion to Dismiss, ECF No. 23; and (3) Plaintiff’s request to remand to 27 1 California statutory law specifically allows a party to bring a lawsuit using a 28 1 state court the remaining state law claims. The United States’ Motion to Dismiss was 2 submitted on the papers without oral argument pursuant to Civil Local Rule 7.1(d)(1) and 3 Rule 78(b) of the Federal Rules of Civil Procedure. ECF No. 25. After considering the 4 papers submitted, supporting documentation, and applicable law, the Court: (1) GRANTS 5 the parties’ Joint Motion to Dismiss the United States without prejudice; (2) DENIES as 6 moot the United States’ Motion to Dismiss; and (3) REMANDS to state court the 7 remaining claims lodged against Netgain. 8 II. BACKGROUND 9 Plaintiff brings this class action lawsuit alleging state law violations of California’s 10 Confidentiality of Medical Information Act (“CMIA”) relating to a data breach involving 11 Plaintiff and Class members’ medical and personal information. See CAL. CIV. CODE §§ 12 56, et al. 13 A. Statement of Facts2 14 Plaintiff “was a patient of, received medical treatment and diagnosis from, and 15 provided her personal information, including her name, address, date of birth, social 16 security number, phone number and email address to . . . Neighborhood.”3 ECF No. 1-2 17 at 140–196 (“FAC”) at 145,4 ¶ 10. Plaintiff alleges that Neighborhood maintains an online 18 Patient Portal to allow patients to securely access and review their health information, as 19 well as to update their personal information. Id. at 149, ¶ 18. At all relevant times, 20 Neighborhood “maintained and continues to maintain ‘medical information,’ within 21 the meaning of [CMIA] . . . .” Id. at 150, ¶ 118. 22 23 2 The majority of the facts set forth are taken from the FAC and for purposes of ruling on the instant Motion to Dismiss, the Court assumes the truth of the allegations pled and 24 liberally construes all allegations in favor of the non-moving party. Manzarek v. St. Paul 25 Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). 3 The United States was substituted for Neighborhood Healthcare (“Neighborhood) as 26 a Defendant in this case on September 8, 2022, but Neighborhood is the Defendant referred 27 to in the FAC and Statement of Facts. See ECF No. 19. 4 Unless otherwise indicated, all page number references are to the ECF-generated 28 1 Plaintiff alleges that between October 22, 2020 and December 3, 2020, Defendants 2 failed “to properly maintain, preserve, and/or store confidential, medical and personal 3 identifying information of Plaintiff and all other persons similarly situated which allowed 4 an unauthorized person to gain access to” the information. Id. at 140 –141, ¶ 1. 5 Neighborhood and Netgain’s “negligent creation, maintenance, preservation and/or storage 6 of . . . the medical information . . . constituted a disclosure in violation of . . . [CMIA].” 7 Id. at 173–74, ¶¶ 96–98; 178, ¶¶ 118–20. Plaintiff maintains that she and the Class “have 8 the right to expect that the confidentiality of their medical information in possession 9 and/or derived from Defendants . . . be reasonably preserved and protected from 10 unauthorized viewing, exfiltration, theft, and/or disclosures.” Id. at 141, ¶ 1. Plaintiff 11 alleges she and the Class “fear that disclosure and/or release of their medical 12 information could subject them to harassment or abuse.” Id. at 173, ¶ 95. 13 B. Procedural History 14 On June 1, 2021, Plaintiff filed her initial class action lawsuit in state court against 15 Defendants Neighborhood, Netgain, and Health Center Partners of Southern California 16 (“Health Center Partners”). See generally ECF No. 1-2 at 4–47. Specifically, Plaintiff’s 17 Complaint sought damages, restitution, and injunctive relief for violations of: (1) CMIA, 18 California Civil Code sections 56, et seq., against all Defendants; (2) California’s Security 19 Notification Laws, California Civil Code section 1798.82, against Health Center Partners; 20 and (3) California’s Unfair Competition Law, California Business & Professions Code 21 sections 17200, et seq., against all Defendants. See id. On September 8, 2021, Plaintiff 22 filed her First Amended Class Action Complaint alleging the same causes of action against 23 the same Defendants. See generally FAC. 24 On September 9, 2021, Neighborhood removed this case to federal court based on 25 federal question jurisdiction and a federal defendant. ECF No. 1 at 1. Neighborhood 26 argued that it was immune from suit pursuant to 42 U.S.C. § 233(a) and that Plaintiff’s 27 exclusive remedy was against the United States under the Federal Tort Claims Act 28 (“FTCA”). See 28 U.S.C §§ 1346(b), 2672. Neighborhood subsequently filed a Motion to 1 Substitute the United States as a Defendant, and on September 8, 2022, the Court granted 2 Neighborhood’s Motion and substituted the United States as a Defendant in place of 3 Neighborhood. See ECF Nos. 3, 19. On September 9, 2022 Plaintiff voluntarily dismissed 4 Defendant Health Center Partners, leaving the United States and Netgain as the only 5 remaining Defendants in this litigation. 6 On November 7, 2022, the United States filed the instant Motion to Dismiss. ECF 7 No. 23 (“Motion”). On November 28, 2022, Plaintiff filed an Opposition to the Motion to 8 Dismiss. ECF No. 24 (“Oppo.”). The United States did not file a reply. On May 1, 2023, 9 Plaintiff and the United States filed a Joint Motion to Dismiss the United States from this 10 action without prejudice. ECF No. 27. 11 III. DISCUSSION 12 The United States’ original Motion to Dismiss argues that this Court lacks federal 13 jurisdiction, because Plaintiff failed to exhaust her administrative remedies pursuant to the 14 FTCA. See generally Motion. Plaintiff’s Opposition concedes that she did not exhaust her 15 administrative remedies but requests that if the Court dismisses the case, it do so without 16 prejudice. See generally Oppo. Plaintiff further requests that the remaining state law 17 claims against Netgain be remanded to state court. See id. Plaintiff and the United States 18 subsequently filed a Joint Motion asking the Court to dismiss the United States from this 19 litigation without prejudice. ECF No. 27. 20 A. Dismissal of the United States 21 Because the parties now agree to a dismissal of the United States without prejudice, 22 the United States’ original Motion to Dismiss, see ECF No. 23, is DENIED as moot. The 23 parties’ Joint Motion seeking dismissal of the United States, see ECF No. 27, is 24 GRANTED. Accordingly, pursuant to the parties’ Joint Motion, the United States is 25 DISMISSED without prejudice. 26 B. Remand 27 Generally, when all federal claims are dismissed in an action that also presents state 28 law claims, a federal court may decline to exercise supplemental jurisdiction over the 1 remaining state law claims. 28 U.S.C. § 1367. A district court’s decision whether to 2 exercise that jurisdiction after dismissing every claim over which it had original 3 jurisdiction is purely discretionary. Carlsbad Tech., Inc. v. HIF BIO, Inc., 556 U.S. 635, 4 639 (2009) (citations omitted). Here, the Court has dismissed the claims against the United 5 States. Remaining in the litigation, however, are state law claims made against Netgain. 6 Plaintiff moves to remand the case back to state court, because there is no federal question 7 jurisdiction over Netgain.5 Oppo. at 11–12. 8 When a case is removed based upon the Attorney General’s Westfall Act 9 certification, 28 U.S.C. § 2679(d)(2) “renders the federal court exclusively competent and 10 categorically precludes a remand to state court.” Osborn v. Haley, 549 U.S. 225, 243 11 (2007). “[T]here is nothing equivocal about the Act’s provision that once a state court 12 action has been removed to a federal court after certification by the Attorney General, it 13 may never be remanded to the state system.” Martinez v. Lamagno, 515 U.S. 417, 440 14 (1995) (Souter, J., dissenting). However, in Osborn, the Supreme Court distinguished 15 between cases where the Attorney General issues a certification (finding exclusive federal 16 jurisdiction) and cases where no certification is issued (allowing for remand). Osborn, 549 17 U.S. at 241–42. 18 Here, although the Court substituted the United States as a Defendant pursuant to 19 the FTCA, it did so without a formal certification from the Attorney General. Therefore, 20 removal was not based on section 2679(d)(2), and nothing in the record indicates that the 21 Attorney General ever issued a Westfall Act certification. As such, exclusive jurisdiction 22 has not been established for purposes of section 2679(d)(2). Because the Court has 23 discretion to remand this litigation and no party opposes remand, the remaining claims 24 lodged against Netgain are REMANDED to the Superior Court of California, County of 25 San Diego. 26 /// 27 5 There also appears to be no diversity jurisdiction over the parties, because Plaintiff 28 1 CONCLUSION 2 For the above reasons, the Court ORDERS the following: 3 1. Plaintiff and the United States’ Joint Motion to Dismiss, see ECF No. 27, is 4||GRANTED. The claims against the United States are DISMISSED without prejudice. 5 || The United States’ Motion to Dismiss, see ECF No. 23, is DENIED as moot. 6 2. The remaining state law claims lodged against Netgain are REMANDED to 7 || the Superior Court of California, County of San Diego. 8 IT IS SO ORDERED. . 9 DATED: May 3, 2023 Alyn, 10 OGER T. BENITE United States District Judge 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -6-