1 JS-6 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 JOHN ROBERT DOYLE and DIANE ) 11 ) Case No.: CV 19-10781-CJC(SSx) MARIE DOYLE, ) 12 ) ) 13 Plaintiffs, ) ) ORDER GRANTING PLAINTIFFS’ 14 v. ) MOTION TO REMAND [Dkt. 11] ) 15 ) GENERAL MOTORS LLC, MARTIN ) 16 CHEVROLET, and DOES 1 through 10, ) inclusive, ) 17 ) ) 18 ) Defendants. ) 19 ) 20 21 I. INTRODUCTION & BACKGROUND 22 23 On November 18, 2019, Plaintiffs John Robert and Diane Marie Doyle brought 24 this action against Defendant General Motors, LLC (“GM”) in Los Angeles County 25 Superior Court, alleging that their 2011 Chevrolet Equinox, which GM manufactured, has 26 an engine defect that causes it to consume excessive oil. Plaintiffs assert that GM 27 violated California’s Song-Beverly Consumer Warranty Act, breached the express 1 Magnuson-Moss Warranty Act (“Mag-Moss”), and committed fraud. (Dkt. 1-1 2 [Complaint].) 3 4 GM removed the case, invoking federal question jurisdiction based on Plaintiffs’ 5 Mag-Moss claim, and also diversity jurisdiction. (Dkt. 7.) After GM moved to dismiss 6 the complaint under Federal Rule of Civil Procedure 12(b)(6), (Dkt. 6), Plaintiffs filed a 7 First Amended Complaint (Dkt. 7 [First Amended Complaint, hereinafter “FAC”]). 8 Plaintiffs made two changes in the FAC: they (1) removed their Mag-Moss claim, and 9 (2) added Martin Chevrolet, the dealership that sold Plaintiffs the car and serviced it, as a 10 Defendant on claims for negligent repair and breach of the implied warranty. (FAC at 11 19–20.) 12 13 Before the Court is Plaintiffs’ motion to remand, which argues that the addition of 14 Martin Chevrolet destroys any diversity jurisdiction the Court had, and that the removal 15 of the Mag-Moss claim destroys federal question jurisdiction. (Dkt. 11 [hereinafter 16 “Mot.”].) GM opposes, arguing that Martin Chevrolet was fraudulently joined and thus 17 does not destroy diversity jurisdiction. (Dkt. 13 [hereinafter “Opp.”].) For the following 18 reasons, Plaintiffs’ motion is GRANTED.1 19 20 II. LEGAL STANDARD 21 22 “Federal courts are courts of limited jurisdiction,” possessing “only that power 23 authorized by Constitution and statute.” Gunn v. Minton, 568 U.S. 251, 256 (2013) 24 (internal quotations omitted). By statute, federal courts have diversity jurisdiction over 25 suits where more than $75,000 is in controversy if the citizenship of each plaintiff is 26
27 1 Having read and considered the papers presented by the parties, the Court finds this matter appropriate 1 different from that of each defendant. 28 U.S.C. § 1332(a). If at any time before final 2 judgment, the court determines that it lacks subject matter jurisdiction, the action shall be 3 remanded to state court. 28 U.S.C. § 1447(c). 4 5 The procedural posture presented in this motion is somewhat unusual. Usually 6 fraudulent joinder comes up when (a) a defendant removes, and argues that the 7 citizenship of an apparently non-diverse defendant included in a state court pleading 8 should be ignored for purposes of removal, or (b) a plaintiff asks the court for leave to 9 add a non-diverse defendant. See 28 U.S.C. § 1447(e) (“If after removal the plaintiff 10 seeks to join additional defendants whose joinder would destroy subject matter 11 jurisdiction, the court may deny joinder, or permit joinder and remand the action to the 12 State court.”) (emphasis added). This case presents neither of these situations. Instead, 13 the parties in the operative pleading were completely diverse when the case was removed, 14 and Plaintiffs then amended their complaint in federal court to add a defendant that would 15 destroy this Court’s diversity jurisdiction, without seeking leave to do so. The Court 16 construes the motion to remand as a request for leave to join an additional defendant 17 whose joinder would destroy subject matter jurisdiction, and to remand the action to the 18 State court under 28 U.S.C. § 1447(e). 19 20 Whether to permit joinder of a party that will destroy diversity remains in the 21 sound discretion of the district court. See Newcombe v. Adolf Coors Co., 157 F.3d 686, 22 691 (9th Cir. 1998). In exercising their discretion, courts consider various factors: 23 (1) whether the party sought to be joined is needed for just adjudication and would be 24 joined under FRCP 19(a), (2) whether the statute of limitations would prevent the filing 25 of a new action against the new defendant should the court deny joinder, (3) whether 26 there has been unexplained delay in seeking joinder, (4) whether the joinder is solely for 27 the purpose of defeating federal jurisdiction, (5) whether the claim against the new party 1 litigation, (7) the closeness of the relationship between the new and the old parties, 2 (8) the effect of an amendment on the court’s jurisdiction; and (9) the new party’s notice 3 of the pending action. McDowell v. Ford Motor Co., 2017 WL 252280, at *2 (C.D. Cal. 4 Jan. 19, 2017). 5 6 III. DISCUSSION 7 8 The Court finds that these factors weigh in favor of allowing amendment. First, it 9 appears that Martin Chevrolet is needed for just adjudication and would be joined under 10 FRCP 19(a)(2). See McDowell, 2017 WL 252280, at *2. The claims asserted against 11 both GM and Martin Chevrolet involve the same car, the same alleged defects in that car, 12 and the same attempts to repair that car, and will likely require many of the same 13 documents and witnesses and turn on many of the same legal and factual questions. See 14 Forward-Rossi v. Jaguar Land Rover N. Am., LLC, 2016 WL 3396925, at *3 (C.D. Cal. 15 June 13, 2016) (concluding that this factor weighed in favor of granting leave to amend 16 for these reasons). In opposition, GM argues that Martin Chevrolet is an unnecessary 17 defendant because it contends the implied warranty the dealership provides is 18 “coextensive” with the warranty from the manufacturer, so the “implied warranty cause 19 of action provides no remedies in addition to those sought from GM and those available 20 in the other causes of action.” (Opp. at 5–6.) However, “[w]here, as here, the breach of 21 warranty claims against the manufacturer and dealership arise from the same vehicle and 22 alleged defects, California district courts have held that the dealership is ‘necessary for 23 just adjudication’ of the claims and thus was properly joined.” Torres v. Ford Motor Co., 24 2018 WL 4182487, at *2 (C.D. Cal. Aug. 30, 2018). GM also completely fails to address 25 Plaintiffs’ negligent repair claim. 26 27 Moreover, Plaintiffs’ claims against Martin Chevrolet appear at least facially valid. 1 defendant because plaintiff’s claim for breach of implied warranty is barred under the 2 statute of limitations.” (Opp. at 4.) But even if this were true, GM again fails to address 3 the validity of Plaintiffs’ negligent repair claim against Martin Chevrolet. The elements 4 of negligence are duty, breach, causation, and damages. Burgess v. Superior Court, 2 5 Cal. 4th 1064, 1072 (1992). “One who undertakes repairs has a duty arising in tort to do 6 them without negligence.” Sw. Forest Indus., Inc. v. Westinghouse Elec.
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1 JS-6 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 JOHN ROBERT DOYLE and DIANE ) 11 ) Case No.: CV 19-10781-CJC(SSx) MARIE DOYLE, ) 12 ) ) 13 Plaintiffs, ) ) ORDER GRANTING PLAINTIFFS’ 14 v. ) MOTION TO REMAND [Dkt. 11] ) 15 ) GENERAL MOTORS LLC, MARTIN ) 16 CHEVROLET, and DOES 1 through 10, ) inclusive, ) 17 ) ) 18 ) Defendants. ) 19 ) 20 21 I. INTRODUCTION & BACKGROUND 22 23 On November 18, 2019, Plaintiffs John Robert and Diane Marie Doyle brought 24 this action against Defendant General Motors, LLC (“GM”) in Los Angeles County 25 Superior Court, alleging that their 2011 Chevrolet Equinox, which GM manufactured, has 26 an engine defect that causes it to consume excessive oil. Plaintiffs assert that GM 27 violated California’s Song-Beverly Consumer Warranty Act, breached the express 1 Magnuson-Moss Warranty Act (“Mag-Moss”), and committed fraud. (Dkt. 1-1 2 [Complaint].) 3 4 GM removed the case, invoking federal question jurisdiction based on Plaintiffs’ 5 Mag-Moss claim, and also diversity jurisdiction. (Dkt. 7.) After GM moved to dismiss 6 the complaint under Federal Rule of Civil Procedure 12(b)(6), (Dkt. 6), Plaintiffs filed a 7 First Amended Complaint (Dkt. 7 [First Amended Complaint, hereinafter “FAC”]). 8 Plaintiffs made two changes in the FAC: they (1) removed their Mag-Moss claim, and 9 (2) added Martin Chevrolet, the dealership that sold Plaintiffs the car and serviced it, as a 10 Defendant on claims for negligent repair and breach of the implied warranty. (FAC at 11 19–20.) 12 13 Before the Court is Plaintiffs’ motion to remand, which argues that the addition of 14 Martin Chevrolet destroys any diversity jurisdiction the Court had, and that the removal 15 of the Mag-Moss claim destroys federal question jurisdiction. (Dkt. 11 [hereinafter 16 “Mot.”].) GM opposes, arguing that Martin Chevrolet was fraudulently joined and thus 17 does not destroy diversity jurisdiction. (Dkt. 13 [hereinafter “Opp.”].) For the following 18 reasons, Plaintiffs’ motion is GRANTED.1 19 20 II. LEGAL STANDARD 21 22 “Federal courts are courts of limited jurisdiction,” possessing “only that power 23 authorized by Constitution and statute.” Gunn v. Minton, 568 U.S. 251, 256 (2013) 24 (internal quotations omitted). By statute, federal courts have diversity jurisdiction over 25 suits where more than $75,000 is in controversy if the citizenship of each plaintiff is 26
27 1 Having read and considered the papers presented by the parties, the Court finds this matter appropriate 1 different from that of each defendant. 28 U.S.C. § 1332(a). If at any time before final 2 judgment, the court determines that it lacks subject matter jurisdiction, the action shall be 3 remanded to state court. 28 U.S.C. § 1447(c). 4 5 The procedural posture presented in this motion is somewhat unusual. Usually 6 fraudulent joinder comes up when (a) a defendant removes, and argues that the 7 citizenship of an apparently non-diverse defendant included in a state court pleading 8 should be ignored for purposes of removal, or (b) a plaintiff asks the court for leave to 9 add a non-diverse defendant. See 28 U.S.C. § 1447(e) (“If after removal the plaintiff 10 seeks to join additional defendants whose joinder would destroy subject matter 11 jurisdiction, the court may deny joinder, or permit joinder and remand the action to the 12 State court.”) (emphasis added). This case presents neither of these situations. Instead, 13 the parties in the operative pleading were completely diverse when the case was removed, 14 and Plaintiffs then amended their complaint in federal court to add a defendant that would 15 destroy this Court’s diversity jurisdiction, without seeking leave to do so. The Court 16 construes the motion to remand as a request for leave to join an additional defendant 17 whose joinder would destroy subject matter jurisdiction, and to remand the action to the 18 State court under 28 U.S.C. § 1447(e). 19 20 Whether to permit joinder of a party that will destroy diversity remains in the 21 sound discretion of the district court. See Newcombe v. Adolf Coors Co., 157 F.3d 686, 22 691 (9th Cir. 1998). In exercising their discretion, courts consider various factors: 23 (1) whether the party sought to be joined is needed for just adjudication and would be 24 joined under FRCP 19(a), (2) whether the statute of limitations would prevent the filing 25 of a new action against the new defendant should the court deny joinder, (3) whether 26 there has been unexplained delay in seeking joinder, (4) whether the joinder is solely for 27 the purpose of defeating federal jurisdiction, (5) whether the claim against the new party 1 litigation, (7) the closeness of the relationship between the new and the old parties, 2 (8) the effect of an amendment on the court’s jurisdiction; and (9) the new party’s notice 3 of the pending action. McDowell v. Ford Motor Co., 2017 WL 252280, at *2 (C.D. Cal. 4 Jan. 19, 2017). 5 6 III. DISCUSSION 7 8 The Court finds that these factors weigh in favor of allowing amendment. First, it 9 appears that Martin Chevrolet is needed for just adjudication and would be joined under 10 FRCP 19(a)(2). See McDowell, 2017 WL 252280, at *2. The claims asserted against 11 both GM and Martin Chevrolet involve the same car, the same alleged defects in that car, 12 and the same attempts to repair that car, and will likely require many of the same 13 documents and witnesses and turn on many of the same legal and factual questions. See 14 Forward-Rossi v. Jaguar Land Rover N. Am., LLC, 2016 WL 3396925, at *3 (C.D. Cal. 15 June 13, 2016) (concluding that this factor weighed in favor of granting leave to amend 16 for these reasons). In opposition, GM argues that Martin Chevrolet is an unnecessary 17 defendant because it contends the implied warranty the dealership provides is 18 “coextensive” with the warranty from the manufacturer, so the “implied warranty cause 19 of action provides no remedies in addition to those sought from GM and those available 20 in the other causes of action.” (Opp. at 5–6.) However, “[w]here, as here, the breach of 21 warranty claims against the manufacturer and dealership arise from the same vehicle and 22 alleged defects, California district courts have held that the dealership is ‘necessary for 23 just adjudication’ of the claims and thus was properly joined.” Torres v. Ford Motor Co., 24 2018 WL 4182487, at *2 (C.D. Cal. Aug. 30, 2018). GM also completely fails to address 25 Plaintiffs’ negligent repair claim. 26 27 Moreover, Plaintiffs’ claims against Martin Chevrolet appear at least facially valid. 1 defendant because plaintiff’s claim for breach of implied warranty is barred under the 2 statute of limitations.” (Opp. at 4.) But even if this were true, GM again fails to address 3 the validity of Plaintiffs’ negligent repair claim against Martin Chevrolet. The elements 4 of negligence are duty, breach, causation, and damages. Burgess v. Superior Court, 2 5 Cal. 4th 1064, 1072 (1992). “One who undertakes repairs has a duty arising in tort to do 6 them without negligence.” Sw. Forest Indus., Inc. v. Westinghouse Elec. Corp., 422 F.2d 7 1013, 1020 (9th Cir. 1970). In support of their negligent repair claim, Plaintiffs allege 8 that they took their vehicle to Martin Chevrolet for repairs on eight occasions between 9 March 2015 and October 2018. (FAC ¶¶ 10–17.) They further allege that Martin 10 Chevrolet owed them a duty to use ordinary care and skill in the storage, preparation, and 11 repair of their vehicle and that Martin Chevrolet breached this duty by failing to properly 12 store, prepare, and repair the vehicle according to industry standards. (Id. ¶¶ 84–85.) 13 Plaintiffs allege this breach was a proximate cause of their damages. (Id. ¶ 86.) GM does 14 not argue that this claim does not appear valid, and the Court finds that it does seem valid 15 for purposes of this motion. See McDowell, 2017 WL 252280, at *2. 16 17 Nor does Plaintiffs’ delay in asserting their claim against Martin Chevrolet weigh 18 against permitting amendment and remanding. See McDowell, 2017 WL 252280, at *2. 19 The fact that Plaintiffs did not include their claims against Martin Chevrolet in their 20 original complaint does not preclude them from stating a colorable claim against Martin 21 Chevrolet in the FAC. See, e.g., Javaherian v. AMCO Ins. Co., 2020 WL 429428, at *3 22 (C.D. Cal. Jan. 27, 2020). Additionally, Plaintiffs amended their complaint to add Martin 23 Chevrolet less than two months after filing the complaint, and less than one month after 24 removal. See Forward-Rossi, 2016 WL 3396925, at *3 (finding this factor supported 25 allowing amendment even where the plaintiff sought leave to amend five months after 26 filing the initial complaint and four months after removal). GM does not assert that any 27 prejudice will result from permitting this amendment. See McDowell, 2017 WL 252280, l On balance, the relevant factors weigh in favor of permitting joinder. The Court 2 ||further observes that justice and fundamental fairness would not be served by requiring 3 || parallel and overlapping actions in state court against Martin Chevrolet, and federal court 4 ||against GM. Accordingly, the Court GRANTS Plaintiffs leave to amend their complaint 5 add Martin Chevrolet. Because joinder divests the Court of diversity jurisdiction, the 6 ||case is hereby REMANDED to Los Angeles County Superior Court. 7 8 CONCLUSION 9 10 For the foregoing reasons, the Court GRANTS Plaintiffs’ motion, and 11 || REMANDS this case to Los Angeles County Superior Court. 12 13 14 DATED: _ February 25, 2020 GV Cy ¢——— ( (— /- 16 CORMAC J. CARNEY 17 UNITED STATES DISTRICT JUDGE 18 19 20 21 22 23 24 25 26 27 28