1 2 3 4 5 6 7 10 11 BRIAN HARVEY, individually and on Case No.: 21-CV-1048 TWR (AGS) behalf of all others similarly situated, 12 ORDER (1) GRANTING Plaintiffs, 13 PLAINTIFF’S MOTION TO v. REMAND; (2) REMANDING 14 ACTION TO THE SUPERIOR ADVISORS MORTGAGE GROUP, LLC; 15 COURT OF CALIFORNIA, and DOES 1 through 20, inclusive, COUNTY OF SAN DIEGO; AND 16 Defendants. (3) DENYING AS MOOT 17 DEFENDANT’S MOTION TO COMPEL ARBITRATION 18
19 (ECF Nos. 6, 7) 20
21 Presently before the Court is Defendant Advisors Mortgage Group, LLC’s Motion 22 to Compel Arbitration or, in the Alternative, to Dismiss for Failure to State a Claim 23 (“Def.’s Mot.,” ECF No. 6) and Plaintiff Brian Harvey’s Motion to Remand Action to 24 State Court (“Mot. to Remand,” ECF No. 7) (together, the “Motions”). The Motions are 25 fully briefed, (see ECF Nos. 8–11), and the Court held oral argument on September 29, 26 2021. (See ECF No. 14.) Having carefully considered the Parties’ arguments, the record, 27 and the relevant law, the Court GRANTS Plaintiff’s Motion to Remand and DENIES AS 28 MOOT Defendant’s Motion. 2 On April 30, 2021, Plaintiff filed a putative class action Complaint in the Superior 3 Court of California, County of San Diego. (See generally ECF No. 1-4 (“Compl.”).) In 4 his Complaint, Plaintiff generally alleges that Defendant, his former employer, 5 systematically violated California’s Labor Laws and Industrial Welfare Commission 6 Wage Orders. (See id. ¶¶ 1–5.) He brings this action on behalf of “[a]ll California 7 citizens currently or formerly employed by Defendants as nonexempt employees in the 8 State of California at any time between November 3, 2016 and the date of class 9 certification.” (See id. ¶ 20 (footnote omitted).) Plaintiff brings seven causes of action 10 for (1) failure to pay minimum wages; (2) failure to pay overtime; (3) failure to provide 11 meal periods; (4) failure to permit rest breaks; (5) failure to provide accurate itemized 12 wage statements; (6) failure to pay all wages due upon separation of employment; 13 (7) violation of California’s Unfair Competition Law (“UCL”), Cal. Bus & Profs. Code 14 §§ 17200, et seq. (See Compl. ¶¶ 37–94.) 15 On June 2, 2021, Defendant filed a Notice of Removal in this Court, alleging 16 diversity subject-matter jurisdiction pursuant to 28 U.S.C. § 1332(a). (See generally ECF 17 No. 1 (“NOR”).) Specifically, Defendant alleges that “Plaintiff’s Complaint asserts 18 claims between citizens of different states and puts in controversy, individually with 19 respect to Plaintiff, an amount that exceeds $75,000.” (Id. ¶ 8 (citing 28 U.S.C. 20 § 1332(a)).) 21 On June 23, 2021, Defendant filed its Motion, seeking an Order compelling 22 arbitration and dismissing this action pursuant to the Federal Arbitration Act, 9 U.S.C. ch. 23 1, and the Loan Officer Assistant Employment Agreement (the “Employment 24 Agreement”) that Plaintiff signed. (See generally Def.’s Mot. at 8–16.) Alternatively, 25 Defendant seeks dismissal of Plaintiff’s claims pursuant to Federal Rule of Civil 26 Procedure 12(b)(6). (See generally Def.’s Mot. at 16–25.) Plaintiff filed the instant 27 Motion to Remand on June 25, 2021, asking the Court to send this action back to state 28 / / / 1 court because Defendant has failed to establish by a preponderance of the evidence that 2 the amount in controversy exceeds $75,000.00. (See generally Mot. to Remand.) 4 I. Legal Standard 5 “The right of removal is entirely a creature of statute and a suit commenced in a 6 state court must remain there until cause is shown for its transfer under some act of 7 Congress.” Syngenta Crop Protection, Inc. v. Henson, 537 U.S. 28, 32 (2002). A suit 8 filed in state court may be removed to federal court if the federal court would have had 9 original jurisdiction over the suit. See 28 U.S.C. § 1441(a). “Federal courts are courts of 10 limited jurisdiction. They possess only that power authorized by Constitution and 11 statute.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Removal 12 is proper when a case originally filed in state court presents a federal question or where 13 there is diversity of citizenship among the parties and the amount in controversy exceeds 14 $75,000. See 28 U.S.C. §§ 1331, 1332(a). A class action may also be removed under the 15 Class Action Fairness Act of 2005 (“CAFA”) so long as the parties are minimally 16 diverse, more than $5,000,000 is in controversy, and there are at least 100 putative class 17 members. See 28 U.S.C. § 1332(d). “If at any time before final judgment it appears that 18 the district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. 19 § 1447(c). 20 The party invoking the removal statute bears the burden of establishing that federal 21 subject-matter jurisdiction exists. Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 22 (9th Cir. 1988). It is “presume[d] that federal courts lack jurisdiction unless the contrary 23 appears affirmatively from the record,” DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 24 342 (2006) (quoting Renne v. Geary, 501 U.S. 312, 316 (1991)), and courts “strictly 25 construe the removal statute against removal jurisdiction.” Gaus v. Miles, Inc., 980 F.2d 26 564, 566 (9th Cir. 1992) (citing Boggs v. Lewis, 863 F.2d 662, 663 (9th Cir. 1988)); 27 Takeda v. Nw. Nat’l Life Ins. Co., 765 F.2d 815, 818 (9th Cir. 1985)); but cf. Dart 28 Cherokee Basin Operating Co. v. Owens, 574 U.S. 81, 89 (2014) (“[N]o antiremoval 1 presumption attends cases invoking CAFA.” (citing Standard Fire Ins. Co. v. Knowles, 2 568 U.S. 588, 595 (2013))). Therefore, “[f]ederal jurisdiction must be rejected if there is 3 any doubt as to the right of removal in the first instance.” Gaus, 980 F.2d at 566 (citing 4 Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1979)). 5 II. Analysis 6 Although Plaintiff filed a putative class action, Defendant removed Plaintiff’s 7 Complaint from Superior Court on the basis of diversity jurisdiction under 28 U.S.C. 8 § 1332(a), (see, e.g., NOR ¶¶ 4–5), rather than under CAFA. Through the instant 9 Motion, Plaintiff seeks to remand his action to Superior Court. (See generally Mot. to 10 Remand; ECF No. 7-1 (“Mem.”).) Plaintiff does not contest that there is complete 11 diversity of citizenship among the Parties, (see ECF No. 8 (“Opp’n”) at 1); rather, 12 Plaintiff contends that Defendant has failed to meet its burden of establishing by a 13 preponderance of the evidence that the amount in controversy exceeds $75,000. (See 14 generally Mot. to Remand at 2; Mem. at 2, 3–8.) 15 Federal courts have diversity jurisdiction “where the amount in controversy” 16 exceeds $75,000, and the parties are of “diverse” state citizenship. See 28 U.S.C. § 1332. 17 A defendant seeking to remove a case to federal court must provide only a “short and 18 plain statement of the grounds for removal.” See 28 U.S.C. § 1446(a). Consequently, 19 “when a defendant seeks federal-court adjudication, the defendant’s amount-in- 20 controversy allegation should be accepted when not contested by the plaintiff or 21 questioned by the court.” See Dart Cherokee, 574 U.S. at 87. But “[i]f the plaintiff [or 22 the court] contests the defendant’s allegation, § 1446(c)(2)(B) instructs: ‘[R]emoval . . . 23 is proper on the basis of an amount in controversy asserted’ by the defendant ‘if the 24 district court finds, by the preponderance of the evidence, that the amount in controversy 25 exceeds’ the jurisdictional threshold.” See id. at 88 (third and fourth alterations in 26 original). 27 “[T]he plaintiff can contest the amount in controversy by making either a ‘facial’ 28 or ‘factual’ attack on the defendant’s jurisdictional allegations.” Harris v. KM Indus., 1 Inc., 980 F.3d 694, 699 (9th Cir. 2020) (citing Salter v. Quality Carriers, 974 F.3d 959, 2 964 (9th Cir. 2020)). “A ‘facial’ attack accepts the truth of the [defendant’s] allegations 3 but asserts that they ‘are insufficient on their face to invoke federal jurisdiction.’” Id. 4 (alteration in original) (quoting Salter, 974 F.3d at 964). “A factual attack ‘contests the 5 truth of the . . . allegations’ themselves,” id. (alteration in original) (quoting Salter, 974 6 F.3d at 964), or “make[s] a reasoned argument as to why any assumptions on which they 7 are based are not supported by evidence.” Id. at 700 (citing Salter, 974 F.3d at 964; 8 Ibarra v. Manheim Invs., Inc., 775 F.3d 1193, 1199 (9th Cir. 2015)). “When a plaintiff 9 mounts a factual attack, the burden is on the defendant to show, by a preponderance of 10 the evidence, that the amount in controversy exceeds the . . . jurisdictional threshold.” Id. 11 at 699 (citing Ibarra, 775 F.3d at 1197). “[W]hen the defendant relies on a chain of 12 reasoning that includes assumptions to satisfy its burden of proof, the chain of reasoning 13 and its underlying assumptions must be reasonable ones.” LaCross v. Knight Transp. 14 Inc., 775 F.3d 1200, 1202 (9th Cir. 2015) (citing Ibarra, 775 F.3d. at 1199). “Both 15 parties may submit evidence supporting the amount in controversy before the district 16 court rules.” Harris, 980 F.3d at 699 (citing Salter, 974 F.3d at 963; Ibarra, 775 F.3d at 17 1197). “The district court should weigh the reasonableness of the removing party’s 18 assumptions.” Id. at 701. “After considering any evidence put forth by the parties, and 19 assessing the reasonableness of the defendant’s assumptions, ‘the court then decides 20 where the preponderance lies.’” Id. (quoting Ibarra, 775.F3d at 1198). 21 “In determining the amount in controversy, courts first look to the complaint.” 22 Ibarra, 775 F.3d at 1197. “Generally, ‘the sum claimed by the plaintiff controls if the 23 claim is apparently made in good faith.’” Id. (quoting St. Paul Mercury Indem. Co. v. 24 Red Cab Co., 303 U.S. 283, 289 (1938)). But “[w]here it is not facially evident from the 25 complaint that more than $75,000 is in controversy, the removing party must prove, by a 26 preponderance of the evidence, that the amount in controversy meets the jurisdictional 27 threshold.” Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 28 2003) (per curiam). Because it is not facially evident from Plaintiff’s Complaint that 1 more than $75,000 is in controversy, the burden is on Defendant to establish—by a 2 preponderance of the evidence—that the amount in controversy exceeds $75,000. See 3 Matheson, 319 F.3d at 1090. The Court concludes that Defendant has failed to meet its 4 burden here. 5 First, Defendant is incorrect that Plaintiff must introduce his own evidence to 6 prevail on his Motion to Remand. (Cf. Opp’n at 4 (“[I]t is not enough for Mr. Harvey to 7 ‘contest’ the amount-in-controversy with mere hand waiving because a factual challenge 8 to the amount-in-controversy requires plaintiff to ‘submit proof,’. . . or to show why the 9 jurisdictional allegations ‘are not supported by evidence.’” (quoting Dart Cherokee, 574 10 U.S. at 88–89; Harris, 980 F.3d at 700)); see also id. at 1, 8.) Once Plaintiff filed his 11 Motion to Remand, Defendant was obligated to introduce evidence to establish by a 12 preponderance of the evidence that, based on its reasonable assumptions, the amount in 13 controversy exceeds $75,000. See Harris, 980 F.3d at 700–01. While Plaintiff “may 14 submit evidence,” see id. at 699 (emphasis added) (citing Salter, 974 F.3d at 963; Ibarra, 15 775 F.3d at 1197), he is not obligated to do so unless Defendant “has first come forward 16 with sufficient evidence to meet its initial burden.” See Townsend v. Brinderson Corp., 17 No. CV 14-5320 FMO (RZx), 2015 WL 3970172, *3 (C.D. Cal. June 30, 2015) (citing 18 Ibarra, 775 F.3d at 1197, 1199); see also, e.g., Harris, 980 F.3d at 700–02 (granting 19 motion to remand despite the fact that “[the plaintiff] did not introduce evidence outside 20 the pleadings” because the defendant had “relied on assumptions . . . that were 21 unreasonable” and “failed to provide any evidence to support its assumption[s]” 22 (emphasis in original)). Because Plaintiff contests the sufficiency of the evidence 23 underlying Defendant’s assumptions, (see ECF No. 11 (“Reply”) at 2–3), Plaintiff need 24 not introduce his own affirmative evidence to demonstrate that Defendant has failed to 25 meet its burden. 26 Second, Defendant contends that the amount in controversy for Plaintiff should be 27 calculated based on the putative class period beginning November 3, 2016, rather than 28 the considerably shorter period during which Defendant actually employed Plaintiff. (See 1 Opp’n at 5.) But Defendant itself introduces evidence that it employed Plaintiff from 2 August 27, 2019, to April 23, 2021. (See ECF No. 8-1 (“Wright Decl.”) ¶ 8.) On the 3 record before the Court, amounts from any other time periods clearly are not “in 4 controversy” with respect to Plaintiff individually. 5 Third, Defendant argues that Plaintiff’s claims for failure to pay minimum wage 6 and failure to pay overtime are not duplicative and therefore should both be included in 7 the amount-in-controversy calculation. (See Opp’n at 6–7.) Although Defendant 8 attempts to distinguish Vasquez v. Randstad US, L.P., No. 17-CV-04342-EMC, 2018 WL 9 327451 (N.D. Cal. Jan. 9, 2018), the Court finds its reasoning persuasive. Here, Plaintiff 10 alleges that, “[t]o the extent these [uncompensated] hours do not qualify for the payment 11 of overtime, Plaintiff and Class Members were not being paid at least the lawful 12 minimum wage for their work.” (See Compl. ¶ 39.) Although “[t]o the extent” may not 13 mean “alternatively,” (see Opp’n at 6), it does convey a degree. Here, that degree is 14 between those hours under eight hours per day for which Plaintiff must be compensated 15 with minimum wages and those hours above eight hours per day or forty hours per week 16 for which Plaintiff must be compensated with overtime wages. In other words, based on 17 the plain language Plaintiff uses in his Complaint, it would appear that Plaintiff does not 18 allege that he was both underpaid by the hour and, additionally, unpaid for his overtime. 19 This inference is confirmed by Defendant’s own evidence that Plaintiff’s base pay was 20 $15 per hour, (see Wright Decl. ¶ 40; see also Wright Decl. Ex. A at 17), which exceeds 21 California’s minimum wages of $12 through $14 per hour for the years Defendant 22 actually employed Plaintiff. See Cal. Dept. of Indus. Relations, Minimum Wage, 23 available at dir.ca.gov/dlse/faq_minimumwage.htm (last accessed Sept. 20, 2021).1 24 Consequently, as in Vasquez, “how this time should be counted for purposes of 25 26 1 The Court may take judicial notice of public records, including those concerning the minimum wage. See, e.g., Lowe v. Lifestyle Publ’ns, LLC, No. SACV19198JVSADSX, 2019 WL 1500665, at *2 (C.D. 27 Cal. Apr. 5, 2019) (taking judicial notice of the same California Department of Industrial Relations 28 webpage); see also Santa Monica Food Not Bombs v. City of Santa Monica, 450 F.3d 1022, 1025 n.2 1 calculating the amount-in-controversy depends on whether employees worked more or 2 less than 8 hours per day or 40 hours per week.” See 2018 WL 327451, at *3. According 3 to Plaintiff’s employment agreement, he was “scheduled to work forty (40) hours per 4 week (the “Maximum Hours”).” (See Wright Decl. Ex. A at 16.) On this record, the 5 Court concludes that the estimated unpaid minimum wages would be duplicative of the 6 estimated unpaid overtime wages. Accordingly, the Court excludes the estimated unpaid 7 minimum wages from the amount-in-controversy calculation. 8 This brings the Court to Defendant’s amount-in-controversy computation. 9 Defendant first calculates the unpaid minimum wages at issue as $38,400. This 10 calculation is based on the unreasonable assumptions that (1) Plaintiff, who was paid $15 11 per hour (a wage exceeding the minimum wage), was underpaid by $5 per hour; and 12 (2) Plaintiff, who was employed by Defendant from August 27, 2019, to April 23, 2021, 13 is seeking unpaid minimum wages from November 3, 2016, to the present. (See Opp’n at 14 9–10 & n.2.) Additionally, the Court has concluded that, absent additional evidence that 15 Plaintiff worked fewer than his contracted forty hours per week, the unpaid minimum 16 wage claim is duplicative of Plaintiff’s unpaid overtime claim. The Court therefore 17 concludes that Defendant has failed to meet its burden of establishing by a preponderance 18 of the evidence that any amount is in controversy with respect to the unpaid minimum 19 wage claim. 20 Regarding the overtime claim, Defendant contends that $34,680 to $43,080 is at 21 issue, with $15,570 at issue for the period during which Plaintiff was actually employed 22 by Defendant. (See Opp’n at 11–13 & nn.3–5.) For the $34,680 figure, Defendant 23 assumes that Plaintiff worked ten hours per week of overtime, compensated at 1.5 times 24 the minimum wage for the year in question. (See id. at 11–12 & n.3.) The $43,080 25 calculation is based on Plaintiff’s actual base pay rate of $15 per hour. (See id. at 13 & 26 n.4.) Given Defendant’s evidence that it employed Plaintiff at $15 per hour only between 27 August 27, 2019, and April 23, 2021, Defendant’s estimate of $17,200 is the only 28 / / / 1 calculation supported by the record. (See id. at 13 n.5.) Plaintiff, however, contests 2 Defendant’s assumed violation rates. (See Reply at 5–6.) With respect to overtime, for 3 example, Defendant assumes that Plaintiff worked ten hours per week, or approximately 4 two hours every weekday, of uncompensated overtime. (See Opp’n at 11–13.) 5 “As seemingly is always the case in wage-and-hour lawsuits attempting to find 6 their way to federal court, violation rates are key to the calculations necessary to reach 7 the . . . amount-in-controversy figure.” Cackin v. Ingersoll-Rand Indus. U.S., Inc., No. 8 820CV02281JLSJDE, 2021 WL 2222217, at *2 (C.D. Cal. June 2, 2021) (quoting 9 Toribio v. ITT Aerospace Controls LLC, No. CV 19-5430-GW-JPRX, 2019 WL 10 4254935, at *2 (C.D. Cal. Sept. 5, 2019)). Although “[a] defendant need not make the 11 plaintiff’s case for it or prove the amount in controversy beyond a legal certainty,” see 12 Harris, 980 F.3d at 701 (citing Dart, 574 U.S. at 88–89; Arias, 936 F.3d at 925), the 13 assumptions the defendant uses in calculating its damages assessment “cannot be pulled 14 from thin air but need some reasonable ground underlying them.” See Ibarra, 775 F.3d at 15 1199. Apparently relying on Behrazfar v. Unisys Corp., 687 F. Supp. 2d 999 (C.D. Cal. 16 2009), Defendant contends only that “it is reasonable to assume” that Plaintiff worked ten 17 hours of overtime per week. (See Opp’n at 11.) But Behrazfar, which predates Ibarra, 18 allowed an assumption that the putative class members worked 2.5 hours of overtime per 19 week because that assumption was “relatively conservative and based on evidence,” 20 including the allegations in the complaint that the named plaintiff worked between forty 21 and sixty hours per week and her deposition testimony that she typically worked ten 22 hours of overtime per week. See Behrazfar, 687 F. Supp. 2d at 1004 (emphasis added). 23 Such evidence is absent here. Instead, Ms. Wright attests only that she “do[es] not 24 believe Mr. Harvey worked any unpaid overtime hours,” but that those employees who 25 “choose” to work overtime, as reflected on their time-sheets, “could consistently accrue 26
27 2 Plaintiff calculates $19,350 for the same period. (See Reply at 7.) Because the burden is on Defendant 28 to prove by a preponderance of the evidence that the amount in controversy exceeds the jurisdictional 1 ten hours of overtime per week.” (See Wright Decl. ¶ 38.) Plaintiff, however, alleges 2 that “Defendants required Plaintiff and Class Members to work in excess of eight (8) 3 hours in a day, forty (40) hours in a week, and/or for a seventh consecutive day in a 4 workweek without paying Plaintiff and Class Members overtime wages for their work.” 5 (See Compl. ¶ 50 (emphasis added).) Because these situations are not analogous, 6 Ms. Wright’s declaration does not support the assumption that Plaintiff worked ten hours 7 of uncompensated overtime per week, nor does Defendant attempt to substantiate any 8 other overtime violation rate. Consequently, Defendant fails to meet its burden of 9 establishing by a preponderance of the evidence a reasonable estimate of Plaintiff’s 10 unpaid overtime. See, e.g., Smith v. Diamond Resorts Mgmt., Inc., No. ED-CV-152477- 11 VAPSPX, 2016 WL 356020, at *3 (C.D. Cal. Jan. 29, 2016) (rejecting assumption of one 12 hour of unpaid overtime per week because the “[d]efendants have failed to put forth any 13 evidence supporting a violation rate of one hour of overtime per week”). Defendant’s 14 calculations of the amounts in controversy for Plaintiff’s unpaid rest and meal breaks, 15 (see id. at 13–15 & nn.6–7; see also Wright Decl. ¶¶ 41–50 & nn.6–7), suffer this same 16 defect: Defendant assumes—without providing evidentiary support—a violation rate of 17 three hours per week for each. See, e.g., Smith, 2016 WL 356020, at *3 (concluding that 18 assumption of one missed meal period and one missed rest break per week was 19 unsupported by evidence (citing Weston v. Helmerich & Payne Int’l Drilling Co., No. 20 1:13-cv-01092-LJO-JLT, 2013 WL 5274283, at *6 (E.D. Cal. Sept. 17, 2013); Munoz v. 21 Cent. Parking Sys., Inc., No. CV 10-6172 PA (RCx), 2010 WL 3432239, at *2 (C.D. Cal. 22 Aug. 30, 2010)). 23 Finally, Defendant assumes that Plaintiff is entitled to the maximum available 24 penalties for inaccurate wage statements and waiting time penalties. (See Opp’n at 15–17 25 & nn.8–9.) Although Plaintiff filed his Complaint on April 30, 2021, (see generally 26 Compl.), only one week after leaving Defendant’s employ on April 23, 2021, (see Wright 27 Decl. ¶ 56), the Court concludes based on the continued pendency of this case that it is 28 reasonable to assume that Plaintiff was not paid the full compensation he claims was due 1 for thirty days. Consequently, the Court concludes that Defendant’s calculation for the 2 maximum waiting time penalties of $3,600 is reasonable. The same is not true, however, 3 of Defendant’s calculation of the penalties at issue for Plaintiff’s inaccurate wage 4 statements. Defendant employed Plaintiff for 86 weeks, or 43 pay periods. (See Wright 5 Decl. ¶ 52.) To obtain the maximum penalty of $4,000, based on penalties of $50 for the 6 initial pay period and $100 for each additional pay period, Defendant would have had to 7 provide inaccurate wage statements for at least 41 pay periods of Plaintiff’s 43 pay 8 periods of employment. (See id. ¶ 53.) In other words, Defendant claims approximately 9 a 95% violation rate based on Plaintiff “alleging that he regularly was not paid minimum 10 wage and overtime.” (See id.) Given Defendant’s failure to introduce any evidence 11 supporting a 95% violation rate, the Court concludes that Defendant has failed to 12 establish by a preponderance of the evidence that $4,000 is at issue for Plaintiff’s claim 13 for failure to provide accurate wage statements. 14 Even accepting Defendant’s calculations based on Plaintiff’s actual base wage and 15 prorated for the period Defendant actually employed Plaintiff, the amount in controversy 16 comes only to $32,000,3 well below the $75,000 jurisdictional threshold. Defendant 17 contends, however, that “the attorneys’ fees incurred in an individual California wage and 18 hour suit typically exceed $75,000.” (See Opp’n at 18 (citing Lippold v. Godiva 19 Chocolatier, Inc., No. C 10-00421 SI, 2010 WL 1526441, at *4 (N.D. Cal. Apr. 15, 20 2010)).) But this action is not an individual action, (see generally Compl.), and 21 Defendant cites no authority allowing the Court to disregard Plaintiff’s “boilerplate, 22 copy-and-paste class claims.” (See Opp’n at 17.) Instead, Defendant accuses Plaintiff of 23 “gamesmanship,” contending that, under CAFA, aggregation is required for all putative 24 class actions. (See id. at 18–21.) Defendant, however, removed this action under Section 25 1332(a)—which requires Defendant to establish that the amount in controversy for
26 3 Excluding the duplicative claim for unpaid minimum wages, see supra pages 7–8, this amount is 27 calculated based on $17,200 for unpaid overtime, (see Opp’n at 13 n.5); $3,600 each (or $7,200 total) 28 for unpaid break and meal periods, (see id. at 14 & n.7); $4,000 for failure to provide accurate, itemized 1 Plaintiff’s claims alone exceeds $75,000—rather than under CAFA, which would require 2 Defendant to establish that the amount in controversy for the putative class would exceed 3 $5,000,000.4 (See generally NOR.) Defendant cannot invoke those provisions of CAFA 4 that facilitate its burden, i.e., aggregation, without accepting the concomitant 5 encumbrances, including establishing by a preponderance of the evidence that the amount 6 in controversy exceeds $5,000,000. See 28 U.S.C. § 1332(d)(6).5 The only “nonsensical 7 result” here would be to allow any putative class action alleging entitlement to attorneys’ 8 fees filed in state court to be removed to federal court on the basis that the aggregated 9 attorneys’ fees alone would exceed $75,000. (Cf. Opp’n at 20 (citing Committee on the 10 Judiciary, S. Rep. No. 109-14, at 10–11 & n. 29 (2005)).) The Court therefore declines to 11 accept estimated fee awards based on fees awarded in individual wage-and-hour cases or 12 aggregated wage-and-hour class actions. Cf. Kanter v. Warner-Lamber Co., 265 F.3d 13 853, 858 (9th Cir. 2001) (requiring attorneys’ fees sought by putative class pursuant to 14 California’s Consumer Legal Remedies Act to be divided among all members of the 15 putative class for calculating the $75,000 amount in controversy). 16 “[W]hen a statute or contract provides for the recovery of attorneys’ fees, 17 prospective attorneys’ fees must be included in the assessment of the amount in 18 controversy.” Arias v. Residence Inn by Marriott, 936 F.3d 920, 922 (9th Cir. 2019) 19 (citing Fritsch v. Swift Transp. Co. of Ariz., LLC, 899 F.3d 785, 794 (9th Cir. 2018)). 20 “The defendant retains the burden, however, of proving the amount of future attorneys’ 21 fees by a preponderance of the evidence.” See id. at 927–28 (quoting Fritsch, 899 F.3d at 22
23 4 As Plaintiff notes, (see Reply at 3 n.1), it would appear that Defendant cannot meet its burden under 24 CAFA because it estimates that there are only 24 to 48 putative class members, (see Wright Decl. ¶ 15), whereas CAFA requires at least 100 putative class members. See 28 U.S.C. § 1332(d)(5)(B). 25 5 Defendant contends that Section 1332(d)(6) should be read “expansively” to permit aggregation in all 26 class actions, whether removed under CAFA or not. (See Opp’n at 20–21.) But this provision, which is part of CAFA, is clearly limited on its face to class actions removed under CAFA, which requires the 27 amount in controversy to exceed five million dollars: “In any class action, the claims of the individual 28 class members shall be aggregated to determine whether the matter in controversy exceeds the sum or 1 788). “The type of evidence that courts have considered to estimate reasonable future 2 attorney’s fees include a percentage of economic damages alleged, fee awards in similar 3 cases, and estimates of the number of hours that will likely be required to litigate the 4 pending case multiplied by the opposing counsel’s hourly rate.” Peck v. First Student, 5 Inc., No. 3:17-CV-0863-SI, 2017 WL 3288116, at *3 (D. Or. Aug. 2, 2017) (collecting 6 cases). The district court retains discretion, however, “to determine whether defendants 7 have carried their burden of proving future attorneys’ fees, and to determine when a fee 8 estimate is too speculative because of the likelihood of a prompt settlement.” See 9 Fritsch, 899 F.3d at 795. 10 Here, relying on two other putative class action cases involving Plaintiffs’ 11 counsel—Alkady v. First Transit, Inc., No. 16-cv-2291, 2021 WL 2072376 (S.D. Cal. 12 May 24, 2021), and Jimenez v. O’Reilly Auto. Inc., No. SACV1200310AGJPRX, 2018 13 WL 6137591 (C.D. Cal. June 18, 2018)—Defendant contends that the attorneys’ fees at 14 issue range between $258,922.50 and $298,501.50, or $5,394.22 to $12,437.56 on a non- 15 aggregated basis. (See Opp’n at 22–23 & nn.13–14.) Defendant’s calculation is based on 16 the “average billing rate” of $592.50 calculated in Alkady based on the billing rates of 17 five specific attorneys—partners Samuel A. Wong and Jessica A. Campbell and 18 associates Laura Birnbaum, Simon Kwak, and Ali Carlsen—multiplied by the 437 hours 19 billed in Alkady or the 503.8 hours in Jimenez divided by twenty-four potential class 20 members in this action. (See Opp’n at 22–23 & n13 (citing Alkady, 2021 WL 2072376, 21 at *5; Jimenez, 2018 WL 6137591, at *3).) Defendant adds that “[a] trial and appeal 22 would . . . double or triple that amount, i.e., to more than $37,000 on a prorated basis.” 23 (See id. at 23.) Although the Court could identify several deficiencies with this 24 calculation,6 it need not undertake this fruitless exercise—even assuming Defendant’s 25 26 6 Not only has Defendant failed to identify in what ways these two cases are similar to the instant action, but both Alkady and Jimenez involved much larger classes. See Alkady, 2021 WL 2072376, at *2 (1,114 27 putative class members); Jimenez, 2018 WL 6137591, at *1 (1,504 confirmed class members). 28 Common sense dictates that additional class members require additional hours, particularly when it 1 maximum prorated fee award of $37,000, the total amount in controversy comes to only 2 $69,000, which falls below the $75,000 threshold. 3 In sum, Defendant has failed to meet its burden of establishing by a preponderance 4 of the evidence that the amount in controversy exceeds $75,000. Nonetheless, Defendant 5 requests the opportunity to serve jurisdictional discovery. (See Opp’n at 24–25.) In the 6 Ninth Circuit, however, whether to allow jurisdictional discovery is committed to the 7 district court’s discretion, and such discovery is not required unless Defendant will suffer 8 “actual and substantial prejudice.” See Abrego Abrego v. Dow Chem. Co., 443 F.3d 676, 9 691 (9th Cir. 2006) (quoting Wells Fargo & Co. v. Wells Fargo Express Co., 556 F.2d 10 406, 430 n.24 (9th Cir. 1977)). Defendant makes no argument regarding prejudice except 11 that “[a]llowing this discovery prevents unfairly prejudicing [Defendant]’s right of access 12 to this Court or wasting resources.” (See Opp’n at 25 (citing 28 U.S.C. § 1446(c)(1)).) 13 First, Defendant has no right of access to this Court unless it meets its burden of 14 demonstrating that this Court has subject-matter jurisdiction, see supra pages 3–6, which 15 Defendant has failed to do here. Second, Defendant had the opportunity to engage in 16 discovery in the Superior Court prior to removing this action. Rather than “try to pin 17 Plaintiff down, in state court . . . , with respect to what the Complaint’s allegations 18 actually mean with respect to violation rates[, p]erhaps . . . by serving interrogatories or 19 requests for admission, perhaps by deposition, perhaps by moving for a more definite 20 statement,” see Toribio v. ITT Aerospace Controls LLC, No. CV 19-5430-GW-JPRX, 21 2019 WL 4254935, at *3 (C.D. Cal. Sept. 5, 2019), Defendant reflexively removed 22 Plaintiff’s “broad and vague” Complaint within thirty days of its receipt. (See Opp’n at 23 24; NOR ¶ 3; see also, e.g., Opp’n at 1 (“opaque”), 7 (“vague . . . allegations”), 10 (“does 24 not disclose the precise factual basis for his claim”), 14 (“vague language” and “so 25 lacking in factual allegations” (quoting Ritenour v. Carrington Mortg. Servs. LLC, 228 F.
26 Alkady and Jimenez came to $232.43 and $198.48, respectively. The upper end of Defendant’s fee 27 calculation also assumes the minimum number of potential class members (24), thereby maximizing the 28 non-aggregated fee calculation, without providing a factual basis for this assumption. (See Wright Decl. 1 ||Supp. 3d 1025, 1028, 1030 (C.D. Cal. 2017))), 17 (boilerplate, copy-and-paste class 2 ||claims”), 21 (“intentional opacity... and... refusal .. . to disclose their alleged factual 3 ||basis”).) Any resultant prejudice is therefore of Defendant’s own making, particularly 4 ||given “the importance of ‘guard[ing] against premature and protective removals and 5 ||minimiz[ing] the potential for a cottage industry of removal litigation.’” Abrego, 443 6 || F.3d at 691 (alterations in original) (quoting Harris, 425 F.3d at 698). Accordingly, the 7 || Court concludes that remand is appropriate. See id. at 691-92; see also Harris, 425 F.3d 8 698 (“By assuring that removal occurs once the jurisdictional facts supporting removal 9 || are evidence, we also ensure respect for the jurisdiction of state courts.”). 11 For the foregoing reasons, the Court GRANTS Plaintiff’s Motion to Remand (ECF 12 ||No. 7) and REMANDS this action to the Superior Court of California, County of San 13 ||Diego. Accordingly, the Court DENIES AS MOOT Defendant’s Motion to Compel 14 || Arbitration (ECF No. 6). 16 Dated: October 1, 2021 : Tan \Qbn— □ Honorable Todd W. Robinson 19 United States District Court 20 21 22 23 24 25 26 27 28