1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 NORTHERN DISTRICT OF CALIFORNIA 8 LOI NGO, 9 Case No. 19-cv-04277-JCS Plaintiff, 10 ORDER DENYING MOTION FOR v. ATTORNEYS’ FEES AND VACATING 11 MOTION HEARING UNITED AIRLINES, INC., et al., 12 Re: Dkt. No. 14 Defendants. 13
14 15 I. INTRODUCTION 16 Plaintiff Ngo filed this action in the Superior Court of the State of California, County of 17 Alameda, asserting state law employment discrimination claims against his former employer, 18 United Airlines (“United”), and two of his former supervisors, Mohammed Buksh and Yvonne 19 Pierce. United removed to federal court on the basis of diversity jurisdiction, arguing that 20 although Defendants Buksh and Pierce are citizens of California – as is Ngo – there is diversity of 21 citizenship because Buksh and Pierce were fraudulently joined in this action. In its November 15, 22 2019 Order (“the November 15 Order”), the Court found that Buksh and Pierce were not sham 23 defendants and remanded the case to State court on the basis that there was no subject matter 24 jurisdiction over the action. Presently before the Court is Plaintiff’s Motion for Attorneys’ Fees 25 Pursuant to 28 U.S.C. § 1447(c) (“Motion”). The Court finds that the Motion is suitable for 26 determination without oral argument and therefore vacates the hearing set for January 10, 2020 27 1 pursuant to Civil Local Rule 7-1(b). For the reasons stated below, the Motion is DENIED.1 2 II. BACKGROUND 3 Ngo asks the Court to award $75,836.00 in fees and $64.50 in costs that he contends were 4 incurred as a result of United’s improper removal of this action to federal court. He argues that an 5 award of fees is warranted because United lacked an “objectively reasonable basis for seeking 6 removal.’” Motion at 3 (citing Grancare, LLC v. Thrower by & through Mills, 889 F.3d 543, 552 7 (9th Cir. 2018)); Reply at 2. This amount includes fees incurred in drafting the instant Motion and 8 responding to United’s Opposition, as well as fees for other work on the case while it was in 9 federal court. Ngo has supplied declarations of his attorneys, Katharine Chao and Xinying 10 Valerian, documenting the time billed and rates charged by counsel. 11 United opposes the motion, arguing that removal was not objectively unreasonable as the 12 operative pleading at the time of removal did not assert a harassment claim against Buksh and 13 Pierce and the conduct alleged as to those defendants was not actionable as harassment as it arose 14 out of necessary personnel management duties. United further asserts that if the Court awards fees 15 and costs it should reduce the amount because: 1) some of the fees Ngo requests were not incurred 16 as a result of the removal; 2) Ngo has not adequately documented the hours billed or has billed for 17 improper tasks; and 3) because the hourly rates Ngo requests are excessive. 18 III. ANALYSIS 19 A. Legal Standards Governing Award of Attorneys’ Fees under 28 U.S.C. § 1447(c) 20 Pursuant to 28 U.S.C. § 1447(c), “[a]n order remanding the case may require payment of 21 just costs and any actual expenses, including attorney fees, incurred as a result of the removal.” 28 22 U.S.C. § 1447(c). The Supreme Court has held that, “[a]bsent unusual circumstances, courts may 23 award attorney’s fees under § 1447(c) only where the removing party lacked an objectively 24 reasonable basis for seeking removal. Conversely, when an objectively reasonable basis exists, 25
26 1 The parties have consented to the jurisdiction of the undersigned magistrate judge pursuant to 28 U.S.C. § 636(c). Further, because the award of fees pursuant to 28 U.S.C. § 1447(c) is collateral 27 to the decision to remand, the Court may award attorneys’ fees under that section even though the 1 fees should be denied.” Martin v. Franklin Capital Corp., 546 U.S. 132, 141, 126 S.Ct. 704, 163 2 L.Ed.2d 547 (2005). The Court in Martin explained that “district courts retain discretion to 3 consider whether unusual circumstances warrant a departure from the rule in a given case.” Id. In 4 Lussier v. Dollar Tree Stores, Inc., the Ninth Circuit cautioned that “removal is not objectively 5 unreasonable solely because the removing party’s arguments lack merit, or else attorney’s fees 6 would always be awarded whenever remand is granted.” 518 F.3d 1062, 1065 (9th Cir. 2008). 7 Rather, the objective reasonableness of the removal depends on the clarity of the applicable law 8 and whether such law “clearly foreclosed” the defendant’s arguments for removal. Id. at 1066–67. 9 B. Whether an Award of Attorneys’ Fees is Warranted 10 Although the Court considered the allegations in Ngo’s First Amended Complaint (“FAC”) 11 in determining whether there was a “a possibility” that Ngo’s original complaint stated a cause of 12 action against Buksh and Pierce, it is undisputed that the FAC had not yet been served at the time 13 of removal and therefore, that the operative complaint for the purposes of determining whether 14 removal was objectively unreasonable was the original complaint filed in state court. See 15 Noorazar v. BMW of N. Am., LLC, No. 18-CV-02472 W (JLB), 2019 WL 442477, at *3 (S.D. Cal. 16 Feb. 5, 2019) (“The Central and Northern Districts have consistently held that an amended 17 complaint supersedes the original only when served on the opposing party.”). Therefore, in 18 determining whether removal was objectively unreasonable, the Court looks to the original 19 complaint in this case. While this question presents a close call, the Court concludes that removal 20 was not objectively unreasonable. 21 As the Court noted in its November 15 Order, “‘[a] defendant invoking federal court 22 diversity jurisdiction on the basis of fraudulent joinder bears a “heavy burden” since there is a 23 “general presumption against finding fraudulent joinder.”’” Grancare, LLC v. Thrower ex rel. 24 Mills, 889 F.3d 543, 549 (9th Cir. 2018) (internal brackets omitted) (quoting Hunter v. Philip 25 Morris USA, 582 F.3d 1039, 1046 (9th Cir. 2009)). Thus, “[a] court may find fraudulent joinder 26 only if the claim against the non-diverse defendant is ‘wholly insubstantial and frivolous.” 27 Grancare, LLC v. Thrower ex rel. Mills, 889 F.3d 543, 549 (9th Cir. 2018) (internal quotation and 1 circumstances personnel management actions can be evidence of harassment. Roby v. McKesson 2 Corp., 47 Cal. 4th 686, 709 (2009), modified, Feb. 10, 2010). Moreover, even “[a] single incident 3 of harassing conduct is sufficient to create a triable issue regarding the existence of a hostile work 4 environment if the harassing conduct has unreasonably interfered with the plaintiff’s work 5 performance or created an intimidating, hostile, or offensive working environment.” Cal. Gov’t 6 Code section 12923(b) (effective January 1, 2019).
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1 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 NORTHERN DISTRICT OF CALIFORNIA 8 LOI NGO, 9 Case No. 19-cv-04277-JCS Plaintiff, 10 ORDER DENYING MOTION FOR v. ATTORNEYS’ FEES AND VACATING 11 MOTION HEARING UNITED AIRLINES, INC., et al., 12 Re: Dkt. No. 14 Defendants. 13
14 15 I. INTRODUCTION 16 Plaintiff Ngo filed this action in the Superior Court of the State of California, County of 17 Alameda, asserting state law employment discrimination claims against his former employer, 18 United Airlines (“United”), and two of his former supervisors, Mohammed Buksh and Yvonne 19 Pierce. United removed to federal court on the basis of diversity jurisdiction, arguing that 20 although Defendants Buksh and Pierce are citizens of California – as is Ngo – there is diversity of 21 citizenship because Buksh and Pierce were fraudulently joined in this action. In its November 15, 22 2019 Order (“the November 15 Order”), the Court found that Buksh and Pierce were not sham 23 defendants and remanded the case to State court on the basis that there was no subject matter 24 jurisdiction over the action. Presently before the Court is Plaintiff’s Motion for Attorneys’ Fees 25 Pursuant to 28 U.S.C. § 1447(c) (“Motion”). The Court finds that the Motion is suitable for 26 determination without oral argument and therefore vacates the hearing set for January 10, 2020 27 1 pursuant to Civil Local Rule 7-1(b). For the reasons stated below, the Motion is DENIED.1 2 II. BACKGROUND 3 Ngo asks the Court to award $75,836.00 in fees and $64.50 in costs that he contends were 4 incurred as a result of United’s improper removal of this action to federal court. He argues that an 5 award of fees is warranted because United lacked an “objectively reasonable basis for seeking 6 removal.’” Motion at 3 (citing Grancare, LLC v. Thrower by & through Mills, 889 F.3d 543, 552 7 (9th Cir. 2018)); Reply at 2. This amount includes fees incurred in drafting the instant Motion and 8 responding to United’s Opposition, as well as fees for other work on the case while it was in 9 federal court. Ngo has supplied declarations of his attorneys, Katharine Chao and Xinying 10 Valerian, documenting the time billed and rates charged by counsel. 11 United opposes the motion, arguing that removal was not objectively unreasonable as the 12 operative pleading at the time of removal did not assert a harassment claim against Buksh and 13 Pierce and the conduct alleged as to those defendants was not actionable as harassment as it arose 14 out of necessary personnel management duties. United further asserts that if the Court awards fees 15 and costs it should reduce the amount because: 1) some of the fees Ngo requests were not incurred 16 as a result of the removal; 2) Ngo has not adequately documented the hours billed or has billed for 17 improper tasks; and 3) because the hourly rates Ngo requests are excessive. 18 III. ANALYSIS 19 A. Legal Standards Governing Award of Attorneys’ Fees under 28 U.S.C. § 1447(c) 20 Pursuant to 28 U.S.C. § 1447(c), “[a]n order remanding the case may require payment of 21 just costs and any actual expenses, including attorney fees, incurred as a result of the removal.” 28 22 U.S.C. § 1447(c). The Supreme Court has held that, “[a]bsent unusual circumstances, courts may 23 award attorney’s fees under § 1447(c) only where the removing party lacked an objectively 24 reasonable basis for seeking removal. Conversely, when an objectively reasonable basis exists, 25
26 1 The parties have consented to the jurisdiction of the undersigned magistrate judge pursuant to 28 U.S.C. § 636(c). Further, because the award of fees pursuant to 28 U.S.C. § 1447(c) is collateral 27 to the decision to remand, the Court may award attorneys’ fees under that section even though the 1 fees should be denied.” Martin v. Franklin Capital Corp., 546 U.S. 132, 141, 126 S.Ct. 704, 163 2 L.Ed.2d 547 (2005). The Court in Martin explained that “district courts retain discretion to 3 consider whether unusual circumstances warrant a departure from the rule in a given case.” Id. In 4 Lussier v. Dollar Tree Stores, Inc., the Ninth Circuit cautioned that “removal is not objectively 5 unreasonable solely because the removing party’s arguments lack merit, or else attorney’s fees 6 would always be awarded whenever remand is granted.” 518 F.3d 1062, 1065 (9th Cir. 2008). 7 Rather, the objective reasonableness of the removal depends on the clarity of the applicable law 8 and whether such law “clearly foreclosed” the defendant’s arguments for removal. Id. at 1066–67. 9 B. Whether an Award of Attorneys’ Fees is Warranted 10 Although the Court considered the allegations in Ngo’s First Amended Complaint (“FAC”) 11 in determining whether there was a “a possibility” that Ngo’s original complaint stated a cause of 12 action against Buksh and Pierce, it is undisputed that the FAC had not yet been served at the time 13 of removal and therefore, that the operative complaint for the purposes of determining whether 14 removal was objectively unreasonable was the original complaint filed in state court. See 15 Noorazar v. BMW of N. Am., LLC, No. 18-CV-02472 W (JLB), 2019 WL 442477, at *3 (S.D. Cal. 16 Feb. 5, 2019) (“The Central and Northern Districts have consistently held that an amended 17 complaint supersedes the original only when served on the opposing party.”). Therefore, in 18 determining whether removal was objectively unreasonable, the Court looks to the original 19 complaint in this case. While this question presents a close call, the Court concludes that removal 20 was not objectively unreasonable. 21 As the Court noted in its November 15 Order, “‘[a] defendant invoking federal court 22 diversity jurisdiction on the basis of fraudulent joinder bears a “heavy burden” since there is a 23 “general presumption against finding fraudulent joinder.”’” Grancare, LLC v. Thrower ex rel. 24 Mills, 889 F.3d 543, 549 (9th Cir. 2018) (internal brackets omitted) (quoting Hunter v. Philip 25 Morris USA, 582 F.3d 1039, 1046 (9th Cir. 2009)). Thus, “[a] court may find fraudulent joinder 26 only if the claim against the non-diverse defendant is ‘wholly insubstantial and frivolous.” 27 Grancare, LLC v. Thrower ex rel. Mills, 889 F.3d 543, 549 (9th Cir. 2018) (internal quotation and 1 circumstances personnel management actions can be evidence of harassment. Roby v. McKesson 2 Corp., 47 Cal. 4th 686, 709 (2009), modified, Feb. 10, 2010). Moreover, even “[a] single incident 3 of harassing conduct is sufficient to create a triable issue regarding the existence of a hostile work 4 environment if the harassing conduct has unreasonably interfered with the plaintiff’s work 5 performance or created an intimidating, hostile, or offensive working environment.” Cal. Gov’t 6 Code section 12923(b) (effective January 1, 2019). Applying these standards, the Court 7 concluded that Ngo was required only to demonstrate only that there was a possibility that a state 8 court would find that one of his claims against Buksh and Pierce was adequately alleged. The 9 Court further found that Ngo’s allegations “easily” met that standard based on his claims for 10 harassment. 11 Notwithstanding the Court’s conclusion that remand was warranted, it also recognizes that 12 there is some ambiguity in California case law regarding the degree to which official personnel 13 actions can form the basis for a hostile work environment claim against a supervisor. Even in 14 Roby, the California Supreme Court reiterated the principle that “the exercise of personnel 15 management authority properly delegated by an employer to a supervisory employee might result 16 in discrimination, but not harassment.” Roby v. McKesson Corp., 47 Cal. 4th 686, 707-708 17 (2009). Further, while the Court in this case concluded that there was at least one incident alleged 18 in both the original complaint and the FAC that fell outside the ambit of an official personnel 19 action (the request by Buksh that the police perform a welfare check even though he had no basis 20 for believing that one was warranted, allegedly to harass and intimidate Ngo), it is true that the 21 vast majority of the specific conduct alleged in the original complaint on the part of Buksh and 22 Pierce clearly arose out of their supervisorial positions (e.g., determining whether Ngo was 23 authorized to return to work). Therefore, the Court does not find the case law on this question to 24 be so well-established that it was objectively unreasonable for United to remove the case to federal 25 court. Accordingly, the Court declines to exercise its discretion under 28 U.S.C. § 1447(c) to 26 award attorneys’ fees.
27 1 IV. CONCLUSION 2 For the reasons stated above, the Motion is DENIED. 3 IT IS SO ORDERED. 4 5 Dated: December 27, 2019 6 Cc J PH C. SPERO 8 ief Magistrate Judge 9 10 ll a 12
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