Miguel Olivas v. The Standard Fire Insurance Company

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 MIGUEL OLIVAS, Case No. 1:25-cv-02018-JLT-CDB

12 Plaintiff, ORDER GRANTING PLAINTIFF’S MOTION TO REMAND 13 v. 14 (Doc. 9) THE STANDARD FIRE INSURANCE 15 COMPANY,

16 Defendant. 17 18 Pending before the Court1 is the motion of Plaintiff Miguel Olivas (“Plaintiff”) to remand 19 this action to state court, filed on April 2, 2026. (Doc. 9). On April 16, 2026, Defendant The 20 Standard Fire Insurance Company (“Defendant”) filed an opposition to the motion. (Doc. 13). 21 Plaintiff did not file a reply. Following review of the parties’ filings made in connection with the 22 motion, the Court deems the motion suitable for disposition without hearing and oral argument. 23 Local Rule 230(g). For the reasons set forth herein, the Court will grant Plaintiff’s motion to 24 remand. 25 /// 26 1 Following all parties’ expression of consent to the jurisdiction of a magistrate judge for 27 the limited purpose of entering an order resolving Plaintiff’s motion to remand, on April 28, 2026, the motion was assigned to the undersigned for disposition pursuant to 28 U.S.C. § 636(c)(1). (Doc. 1 I. Relevant Background 2 A. Procedural History2 3 Plaintiff initiated this action with the filing of a complaint in the Kern County Superior 4 Court on November 24, 2025, and the operative first amended complaint (“FAC”) on December 9, 5 2025. (Doc. 1). Defendant removed the case to this Court on December 23, 2025. See id. 6 Defendant filed an answer to the FAC on January 5, 2026. (Doc. 3). 7 On March 19, 2026, the parties filed a joint scheduling report. (Doc. 5). On March 25, 8 2026, a scheduling conference was held off the record and the case was not scheduled. At Plaintiff’s 9 request and without objection, in light of Plaintiff’s anticipated filing of a motion to remand, the 10 Court continued the scheduling conference and ordered Plaintiff to file no later than April 3, 2026, 11 any motion to remand. (Doc. 8). Due to the pending motion to remand and the status of the case, 12 the scheduling conference was further continued to August 10, 2026. (Doc. 10). 13 B. Factual Background of Plaintiff’s FAC 14 Plaintiff’s FAC names as defendants The Standard Fire Insurance Company and Does 1- 15 10, who are not known at this time and will be substituted once identified. (Doc. 1-8 ¶¶ 6, 7). 16 Plaintiff alleges that Defendant failed to pay benefits owed under a homeowners insurance policy 17 Defendants issued to Plaintiff after the roof of Plaintiff’s home suffered wind and rain damage. See 18 id. ¶¶ 9-15. Plaintiff further alleges that after his counsel requested Defendant reconsider its denial 19 of coverage and noted the total amount of his claim is $66,026.11 based on $36,872.80 from an 20 independent repair estimate, plus $29,153.31 in mitigation costs from the mitigation contractor, 21 Defendant reiterated its denial of the claim. Id. at 15. Plaintiff asserts two claims against 22 Defendants, including claims for breach of contract and for money damages for tortious bad faith. 23 See id. at 5-8. In the prayer for relief, Plaintiff seeks compensatory damages and punitive damages 24 in an amount according to proof at trial with the addition of prejudgment interest, and for attorney 25 fees and costs. Id. at 9. 26 /// 27 2 Filings are referenced herein according to their CM/ECF-designated pagination. 1 II. Governing Authority 2 Federal courts are courts of limited jurisdiction and may hear only those cases authorized 3 by federal law. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Jurisdiction 4 is a threshold inquiry, and “[f]ederal courts are presumed to lack jurisdiction, ‘unless the contrary 5 appears affirmatively from the record.’” Casey v. Lewis, 4 F.3d 1516, 1519 (9th Cir. 6 1993) (quoting Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 546 (1986)). A federal 7 court’s jurisdiction may be established in one of two ways: actions arising under federal law or 8 those between citizens of different states in which the alleged damages exceed $75,000. 28 U.S.C. 9 §§ 1331, 1332. “Subject-matter jurisdiction can never be waived or forfeited,” and “courts are 10 obligated to consider sua sponte” subject matter jurisdiction even when not raised by the 11 parties. Gonzalez v. Thaler, 565 U.S. 134, 141 (2012). 12 Under 28 U.S.C. § 1441(a), a civil action may be removed to the district court where the 13 action is pending if the district court has original jurisdiction over the action. Under 28 U.S.C. § 14 1332, a district court has original jurisdiction of a civil action where the matter in controversy 15 exceeds the sum or value of $75,000, exclusive of interest and costs, and the dispute is between 16 “citizens of different states.” 17 Removal statutes are “strictly construe[d] against removal.” Gaus v. Miles, Inc., 980 F.2d 18 564, 566 (9th Cir. 1992) (per curiam). “Federal jurisdiction must be rejected if there is any doubt 19 as to the right of removal in the first instance.” Id. Thus, the removing party bears the burden of 20 establishing original jurisdiction in the district court and “any doubt about the right of removal 21 requires resolution in favor of remand.” Corral v. Select Portfolio Servicing Inc., 878 F.3d 770, 22 773 (9th Cir. 2017) (citing Moore-Thomas v. Alaska Airlines, Inc., 553 F.3d 1241, 1244 (9th Cir. 23 2009)); see Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 2009) (“the court resolves 24 all ambiguity in favor of remand to state court.”) (citing Gaus, 980 F.2d at 566). 25 III. Parties’ Contentions 26 Plaintiff moves to remand this action to the Kern County Superior Court, contending that 27 the amount in controversy of $66,026.11 is insufficient to warrant removal on diversity grounds 1 argues that diversity jurisdiction does not exist here because his allegations and prayer for relief, 2 including for damages and injunctive relief, “explicitly limit the collective value of the recovery 3 sought to $74,999.” Id. at 7. In support, Plaintiff attaches the declaration of his counsel Angela 4 Russell to establish that his damages are less than the $75,000 amount-in-controversy requirement. 5 Id.; see id. at 9 (“Russell Decl.”) ¶¶ 4, 5) (“On behalf of Plaintiff, it is stipulated that Plaintiff’s 6 total damages did not exceed $74,999.00 as of the date of the Notice of Removal was filed with the 7 Kern County Superior Court. Additionally, Plaintiff will not seek damages in excess of $74,999.00 8 which includes punitive damages and attorney fees and all other damages permitted by law.”). 9 Counsel for Plaintiff declares that it is stipulated that Plaintiff will not accept damages greater than 10 $74,999.00 if awarded in this matter. Russell Decl. ¶ 6. 11 Defendant contends the motion to remand should be denied because the FAC affirmatively 12 alleges facts placing more than $75,000 in controversy, including pleading $66,026.11 in direct 13 contractual damages, plus damages for emotional distress, loss of use, diminution in property value, 14 and for attorney fees and punitive damages, such that the FAC establishes an amount in controversy 15 sufficient to establish diversity jurisdiction of this matter. (Doc. 13 at 1-2). Defendant asserts 16 counsel for Plaintiff’s attempt to limit damages to $74,999.00 in her post-removal declaration is 17 legally ineffective as Plaintiff may not defeat federal jurisdiction by reducing the amount claimed 18 after removal. Id. at 4. Defendant argues that diversity jurisdiction existed at the time of removal 19 and Plaintiff’s post-removal declaration does not divest the Court of jurisdiction such that the 20 motion should be denied. Id. at 4-5. 21 IV. Discussion 22 Because the parties do not dispute the existence of diversity of citizenship, and the Court 23 does not find any issue as to complete diversity of the parties, (Doc. 1 at 2-3) (notice of removal 24 noting that Plaintiff is a citizen of the State of California and Defendant is a citizen of the State of 25 Connecticut); see generally (Docs. 9, 13), the Court turns to whether Defendant has established the 26 requisite amount-in-controversy to establish diversity jurisdiction to defeat Plaintiff’s motion to 27 remand. 1 A. Governing Authority – Amount in Controversy 2 The amount in controversy is the total “amount at stake in the underlying litigation.” Theis 3 Research, Inc. v. Brown & Bain, 400 F.3d 659, 662 (9th Cir. 2005). “Where it is not facially evident 4 from the complaint that more than $75,000 is in controversy, the removing party must prove, by a 5 preponderance of the evidence, that the amount in controversy meets the jurisdictional threshold.” 6 Corral, 878 F.3d at 774 (quoting Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 7 (9th Cir. 2003)); Fritsch v. Swift Transp. Co. of Ariz., LLC, 899 F.3d 785, 795 (9th Cir. 2018). 8 “Conclusory allegations as to the amount in controversy are insufficient.” Id. (quotation and 9 citation omitted). 10 A defendant desiring to remove any civil action must file a notice of removal “containing a 11 short and plain statement of the grounds for removal[.]” 28 U.S.C. § 1446(a). When a party 12 removes on the grounds of diversity jurisdiction, the allegation in the notice of removal of the 13 amount in controversy “need include only a plausible allegation that the amount in controversy 14 exceeds the jurisdictional threshold.” Dart Cherokee Basin Operating Co., LLC v. Owens, 574 15 U.S. 81, 89 (2014). “Evidence establishing the amount is required by § 1446(c)(2)(B) only when 16 the plaintiff contests, or the court questions, the defendant’s allegation.” Id.; see 28 U.S.C. § 17 §1446(c)(2)(B). In the Ninth Circuit, a removing defendant is required “to make this showing with 18 summary-judgment-type evidence[.]” Fritsch, 899 F.3d at 795 (citing Chavez v. JPMorgan Chase 19 & Co., 888 F.3d 413, 416 (9th Cir. 2018); Corral, 878 F.3d at 774). 20 In Standard Fire Ins. Co. v. Knowles, the Supreme Court affirmed that “federal courts 21 permit individual plaintiffs, who are the masters of their complaints, to avoid removal to federal 22 court, and to obtain a remand to state court, by stipulating to amounts at issue that fall below the 23 federal jurisdictional requirement.” 568 U.S. 588, 595 (2013); see St. Paul Mercury Indemnity Co. 24 v. Red Cab Co., 303 U.S. 283, 294 (1938) (““If [a plaintiff] does not desire to try his case in the 25 federal court he may resort to the expedient of suing for less than the jurisdictional amount, and 26 though he would be justly entitled to more, the defendant cannot remove”). Standard Fire noted 27 that “the key characteristic about th[e]se stipulations [from individual plaintiffs] is that they are 1 And Proc. § 3702.1, p. 335 (4th Ed. 2011) (“federal court, as condition for remand, can insist on a 2 “binding affidavit or stipulation that the plaintiff will continue to claim less than the jurisdictional 3 amount[.]”) (emphasis in original). Standard Fire reasoned that the stipulation at issue can tie the 4 individual plaintiff’s hands “but it does not resolve the amount-in-controversy question” insofar it 5 seeks to bind “the rest of the [plaintiff] class” for purposes of establishing jurisdiction under the 6 Class Action Fairness Act of 2005 (“CAFA”). Id. at 596; see Patel v. Nike Retail Servs., Inc., 58 7 F. Supp. 3d 1032, 1038 (N.D. Cal. 2014) (“After Standard Fire, a class representative cannot 8 stipulate on behalf of absent class members to avoid CAFA’s $5 million aggregate matter in 9 controversy [requirement].”). 10 “Some courts have required that these affidavits or stipulations be executed prior to the 11 notice of removal as a sign of their bona fides and cannot await the motion to remand.” Patel, 58 12 F. Supp. 3d at 1038 (citation omitted); e.g., Blood v. Equifax, Inc., No. 8:18-cv-00958-JLS-PJW, 13 2018 WL 3636960, at *3 (C.D. Cal. July 30, 2018) (granting motion to remand where plaintiffs 14 “have each filed binding stipulations [attached to the FAC] averring that the amount in controversy 15 will not exceed the jurisdictional minimum”); see also Guglielmino v. Mckee Foods Corp., 506 16 F.3d 696, 705 n. 6 (9th Cir. 2007) (Circuit Judge O’Scannlain specially concurring, noting that a 17 “party might file a binding stipulation, prior to removal, that it will not seek more in recovery than 18 the jurisdictional threshold” in order to defeat federal jurisdiction). 19 “[T]hough [a] plaintiff [may], after removal, by stipulation, by affidavit, or by amendment 20 of his pleadings, reduce[] the claim below the requisite amount, this does not deprive the district 21 court of jurisdiction.” See Red Cab Co., 303 U.S. at 292. “[D]iversity jurisdiction is determined 22 at the time the action commences, and a federal court is not divested of jurisdiction … if the amount 23 in controversy subsequently drops below the minimum jurisdiction level.” Hill v. Blind Indus. & 24 Servs., 179 F.3d 754, 757 (9th Cir. 1999). “Notwithstanding this, district courts within this circuit 25 have remanded actions on the condition that a plaintiff stipulate to seeking less than the 26 jurisdictional minimum or submitting an affidavit binding him … not to accept any amount meeting 27 the jurisdictional minimum.” Patel, 58 F. Supp. 3d at 1038-39 (collecting cases); see Whitehurst 1 15, 2022) (“While a plaintiff may not defeat diversity jurisdiction by using a stipulation to reduce 2 or change her demand for damages, … a post-removal stipulation may show the absence of 3 jurisdiction if it clarifies the preexisting amount in controversy … was $75,000 or less at the time 4 of removal[.]”) (citations omitted). 5 B. Analysis 6 The FAC, at the time of removal, did not identify a specific dollar amount in damages. 7 Rather, it included a general prayer for “compensatory and punitive damages in amounts according 8 to proof at trial” and for an award of attorney fees and costs. (Doc. 1-8 at 9). In Plaintiff’s first 9 claim for breach of contract, he alleges that Defendant breached the contract, in part, by “[f]ailing 10 and refusing to pay a sufficient sum for the mitigation invoices for $29,153.31” and that the “precise 11 amount of [his] damages above $35,000 is unknown at this time and will be proven at trial.” Id. at 12 6 ¶¶ 21-22. In his second claim for money damages for tortious bad faith, Plaintiff alleges that 13 Defendant failed to pay him any amount for repairs and mitigation and that his full amount of loss 14 to the subject property “is estimated to be a grand total of $66,026.11 (including the mitigation 15 invoice [of] $29,153.31 and the estimated costs of repairs [of] $36,872.80).” Id. at 7 ¶ 27(d). 16 “Where it is not facially evident from the complaint that more than $75,000 is in 17 controversy, the removing party must prove, by a preponderance of the evidence, that the amount 18 in controversy meets the jurisdictional threshold.” Corral, 878 F.3d at 774. Here, Defendant 19 asserted in its notice of removal that the amount in controversy for jurisdictional purposes is 20 satisfied as the FAC “alleges direct damages in the amount of $66,026.11, plus compensatory 21 damages and punitive damages, and attorneys’ fees[.]” (Doc. 1 at 6 ¶ 20). Defendants further 22 asserted that the FAC “appears to allege a floor of damages at $66,026.11, but it also seeks other 23 unspecified quantities of punitive damages, attorneys’ fees, damages for alleged emotional distress, 24 damages for the alleged diminution of value of the Property, and damages of loss of use, all of 25 which, in totality, more likely than not will exceed a damages controversy in excess of the 26 $8,973.89 necessary to reach $75,000.” Id. at 7 ¶ 26. 27 Although no party argues that Plaintiff entered into a binding pre-removal stipulation that 1 expressly limit his recovery to below the jurisdictional threshold inclusive of all damages, costs, 2 and attorney fees, Defendant fails to meet its burden to show, by a preponderance of the evidence, 3 that the amount in controversy meets the jurisdictional threshold. Corral, 878 F.3d at 774; Fritsch, 4 899 F.3d at 795. 5 Valdez v. Allstate Ins. Co. is instructive. In Valdez, the Ninth Circuit noted that the 6 plaintiff’s state court complaint “falls short of even seeking the threshold amount” as the “only 7 discrete sum requested is ‘general damages … in excess of $50,000.00’” and the complaint “does 8 not attach a dollar figure to [plaintiff’s] remaining prayers for relief.” 372 F.3d 1115, 1116-17 (9th 9 Cir. 2004). The Ninth Circuit found that the defendant did not prove, by a preponderance of the 10 evidence, that the amount in controversy requirement was met because defendant’s petition for 11 removal asserting as much was based on conclusory and unsupported assertions. Id. at 1117 (citing 12 Matheson, 319 F.3d at 1090-91 (“Conclusory allegations as to the amount in controversy are 13 insufficient.”)). 14 Defendant’s assertions regarding the amount in controversy here fare no better than the 15 removing party in Valdez. Thus, Defendant proffers no evidence either in its notice of removal, or 16 in its opposition to the motion, or in counsel for Defendant’s declaration in support thereof (see 17 Doc. 13-1, Declaration of Mark. E. Hellenkamp (“Hellenkamp Decl.”)) that support Defendant’s 18 conclusory assertion that Plaintiff’s seeking of other, unspecified quantities of damages, attorneys’ 19 fees, and costs “more likely than not” (Valdez, 372 F.3d at 1117) will exceed the quantifiable 20 damages alleged in the complaint in excess of the $8,973.89 necessary to reach the jurisdictional 21 threshold. See, e.g., Martinez v. Epic Games, Inc., No. CV 19-10878-CJC(PJWx), 2020 WL 22 1164951, at *4 (C.D. Cal. Mar. 10, 2020) (granting motion to remand, finding defendant’s 23 declaration insufficient to meet burden in establishing the amount in controversy); cf. Gillette v. 24 Peerless Ins. Co., No. CV 13–03161 DDP (RZx), 2013 WL 3983872, at *5 (C.D. Cal. July 31, 25 2013) (denying motion to remand in finding by a preponderance of the evidence that the amount in 26 controversy exceeded the jurisdictional limit at the time of removal in light of defendant’s notice 27 of removal providing calculations estimating damages above the amount in controversy minimum, 1 Defendant’s reliance on Plaintiff’s prayer for an unspecified amount of attorney’s fees to 2 establish the amount necessary to cross the jurisdictional threshold beyond the specified contractual 3 damages alleged of $66,026.11 for repairs and mitigation is insufficient. Fritsch, 899 F.3d at 795 4 (“[A] district court may reject the defendant’s attempts to include future attorneys’ fees in the 5 amount in controversy if the defendant fails to satisfy this burden of proof.”). First, notwithstanding 6 Plaintiff’s prayer for an award of attorney’s fees, the amount of any such fees may only be 7 recoverable and, thus, in controversy, if they are provided for either by statute or contract. Id. at 8 794. Here, Defendant cites no authority and makes no argument in support of its contention that 9 attorney’s fees could or should be included in the amount in controversy calculation. Second, 10 Defendant provides no evidence-based analysis in either its notice of removal or opposition papers 11 sufficient to establish that attorney fees and other categories of damages generally alleged, 12 combined with the direct damages quantified in the complaint, meets the jurisdictional threshold. 13 See Moberly v. FedEx Corp., No. 2:18-cv-00393-KJM-AC, 2019 WL 927295, at *6 (E.D. Cal. Feb. 14 26, 2019) (“The court is not obliged to assist FedEx in meeting its burden and is in fact unable to 15 do so on the record before it. With no basis for concluding the attorneys’ fees at stake here will 16 bring the amount in controversy to a figure exceeding $75,000, this action must be remanded.”); 17 cf. Harville v. Richman Property Servs., Inc., No. 2:24-cv-07832-ODW (SSCx), 2024 WL 18 4557665, at *4 (C.D. Cal. Oct. 22, 2024). 19 Therefore, for purposes of the Court’s analysis of the amount in controversy, Defendant has 20 satisfied its burden of demonstrating that $66,026.11 should be included based on Plaintiff’s 21 specified contractual damages for repair and mitigation costs as alleged in the FAC. But Defendant 22 fails to establish by a preponderance of the evidence either that any other amounts could or should 23 be included or what any such amounts are. And because the removal statute is strictly construed 24 with all doubts resolved in favor of remand, the Court finds that Defendant fails to meet its burden, 25 by a preponderance of the evidence, showing that the amount in controversy here meets the 26 jurisdictional threshold to establish diversity jurisdiction at the time of removal. See Corral, 878 27 F.3d at 775 (“Here, … it is not evidence from the face of the complaint that $75,000 is at issue, and 1 } district court ..... Accordingly, SPS did not satisfy its burden of establishing subject matter 2 | jurisdiction.”). 3 Therefore, the Court will grant Plaintiff's motion to remand this case to the Kern County 4 | Superior Court. Gaus, 980 F.2d at 566. 5] V. Conclusion and Order 6 Accordingly, IT IS HEREBY ORDERED that: 7 1. Plaintiff's motion to remand (Doc. 9) is GRANTED; 8 2. This case is REMANDED to the Kern County Superior Court; and 9 3. The Clerk of Court is directed to take the appropriate action to remand this case to 10 Kern County Superior Court and to close this case. 11 | ITIS SO ORDERED. '2 | Dated: _ June 22, 2026 | Word by 13 UNITED STATES MAGISTRATE JUDGE 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28