Li v. Mummah

• Court: District Court, N.D. California
• Decided: January 20, 2023
• Docket: 5:22-cv-07626
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 NORTHERN DISTRICT OF CALIFORNIA 10 TIANQING LI, 11 Case No. 22-cv-07626 NC Plaintiff, 12 ORDER REMANDING CASE BACK v. 13 TO SANTA CLARA COUNTY PHILLIP MUMMAH, SUPERIOR COURT DUE TO 14 IMPROPER REMOVAL Defendant and 15 Cross-Complainant, Re: ECF 1 16 v.

17 SCOTT A. FLAXMAN, 18 Cross-Claim Defendant. 19

20 21 Scott A. Flaxman sought to remove the cross-claim filed against him in Santa Clara 22 County Superior Court to this Court. ECF 1, Notice of Removal of Cross-Claim. On 23 December 9, 2022, I issued an Order to Show Cause Regarding Removal, asking Flaxman 24 to explain why the case should not be remanded back to the Superior Court under 28 25 U.S.C. § 1441 and Home Depot, U.S.A. v. Jackson, 139 S. Ct. 1743, 1745 (2019). ECF 10. 26 Flaxman responded the next day. ECF 11, supplemented by exhibits ECF 12, 13. I held 27 hearings on the removal on January 11 and January 18, 2023. At the January 18 hearing, 1 waive any defects in removal procedures.1 I find that Flaxman still has not met his burden 2 to establish that removal was proper under 28 U.S.C. § 1441 and I therefore remand the 3 case back to the Superior Court. 4 As a starting point, the general statute governing removal, 28 U.S.C. § 1441, is 5 “strictly construe[d] . . . against removal jurisdiction.” Hansen v. Grp. Health Coop., 902 6 F.3d 1051, 1056 (9th Cir. 2018) (citations and quotation marks omitted); Gaus v. Miles, 7 Inc., 980 F.2d 564, 566 (9th Cir. 1992). If a district court determines at any time that less 8 than a preponderance of the evidence supports the right of removal, it must remand the 9 action to the state court. See Geographic Expeditions, Inc. v. Estate of Lhotka ex rel. 10 Lhotka, 599 F.3d 1102, 1107 (9th Cir. 2010); California ex rel. Lockyer v. Dynegy, Inc., 11 375 F.3d 831, 838 (9th Cir. 2004). The removing defendant bears the burden of 12 overcoming the “strong presumption against removal jurisdiction.” Geographic 13 Expeditions, 599 F.3d at 1107 (citation omitted). 14 The federal removal statute provides that “any civil action brought in a State court 15 of which the district courts of the United States have original jurisdiction, may be removed 16 by the defendant or the defendants” to the appropriate federal district court. 28 U.S.C. § 17 1441(a). In the context of § 1441(a), “the term ‘defendant’ refers only to the party sued 18 by the original plaintiff.” Home Depot U.S.A. Inc. v. Jackson, ––– U.S. ––––, 139 S. Ct. 19 1743, 1746 (2019) (emphasis added). In Home Depot v. Jackson, the Supreme Court 20 assessed whether a third-party counterclaim defendant could remove a claim filed against 21 it under 28 U.S.C. § 1441(a). The majority opinion held that the phrase “the defendant or 22 the defendants” in § 1441(a) “does not permit removal by any counterclaim defendant, 23 including parties brought into the lawsuit for the first time by the counterclaim.” 139 S. 24 Ct. at 1748. The majority opinion found that the dissenting statutory interpretation (also 25 advanced here by Flaxman) was “plausible” but not the “best one.” 139 S. Ct. at 1748. 26 The Supreme Court’s § 1441(a) analysis in Home Depot is not limited to class 27 1 actions under the Class Action Fairness Act. Indeed, the Ninth Circuit Court of Appeal 2 applied Home Depot to remand a non-CAFA mortgage foreclosure case, Sharma v. HSI 3 Asset Loan Obligation Trust 2007-1, 23 F.4th 1167, 1170-71 (9th Cir. Jan. 25, 2022). And 4 other judges of this District have applied Home Depot outside CAFA. “The Supreme 5 Court [in Home Depot v. Jackson] held that, although a third-party defendant may be 6 brought into the action for the first time by a counterclaim, such defendants cannot remove 7 the action under § 1441(a).” Malloy v. Regents of the Univ. of California, No. 19-cv-07995 8 SBA, 2021 WL 4269365, at *5 (N.D. Cal. Aug. 18, 2021). 9 This Order finds unpersuasive Flaxman’s argument that the Home Depot case is 10 “inapposite.” ECF 11 at p. 7. The “exception” Flaxman cites in 28 U.S.C. § 1441(c) does 11 not change the plain meaning of § 1441(a), as interpreted by the Supreme Court in Home 12 Depot and the Ninth Circuit in Sharma. 13 At bottom, applying the plain meaning of 28 U.S.C. § 1441(a) as determined by the 14 U.S. Supreme Court, I find that Flaxman’s removal was improper because he is not a 15 “defendant” under that statute. He was not a “defendant” in the complaint filed by the 16 original plaintiff in state court. If Congress wanted to write a statute permitting cross- 17 claim defendants to remove cross-claims to federal court it could do so. It has not. And 18 Mummah has not waived objection to the improper removal. I thus remand this case back 19 to Santa Clara County Superior Court.2 20 A remand order may require payment of just costs and any actual expenses, 21 including attorney fees, incurred as a result of the removal. 28 U.S.C. § 1447(a). I do not 22 award any fees or costs because Mummah’s fees and costs were minimal and Flaxman 23 responded promptly to the OSC. 24 Finally, Flaxman’s separately filed Motion for Judgment on the Pleadings, ECF 5, 25 is terminated in this Court without prejudice. The Clerk of Court will administratively 26

27 2 There were two other issues raised in the December 9 Order to Show Cause, ECF 10: (1) 1 || close the federal case after remanding the case back to Superior Court. 2 3 IT IS SO ORDERED. 4 5 Dated: January 20, 2023 hore <——— —_—> NATHANAEL M. COUSINS 6 United States Magistrate Judge 7 8 9 10 11 12

Zz 19 20 21 22 23 24 25 26 27 28