Nosratollah Satvati v. Allstate Northbrook Indemnity Company

• Court: District Court, C.D. California
• Decided: March 9, 2022
• Docket: 2:21-cv-08840
• Status: Unknown

Opinion

Case 2°21-cv-08840-RSWL-PD Document Filed 03/09/22 Page1of13 Page ID #:289 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 12 | NOSRATOLLAH SATVATI, et CV21—-8840-RSWL-PDx al., 13 Plaintiffs ORDER re: PLAINTIFFS’ 14 ’ MOTION TO REMAND [7] 1s Vv. 16 | ALLSTATE NORTHBROOK 7 INDEMNITY COMPANY, et al., 18 Defendants. 19 Nosratollah Satvati and Farideh Satvati 20 | (collectively, “Plaintiffs”) bring this Action against 21 | Allstate Northbrook Indemnity Company (“Defendant”) 22 | alleging: (1) breach of contract; (2) breach of the 23 | implied covenant of good faith and fair dealing; and (3) 24 | violation of California Business and Professions Code 25 | Section 17200. 26 Currently before the Court is Plaintiffs’ Motion to 27 | Remand (“Motion”) [7]. Having reviewed all papers 28

Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 2 of 13 Page ID #:290

1 submitted pertaining to the Motion, the Court NOW FINDS

2 AND RULES AS FOLLOWS: the Court DENIES Plaintiff’s

3 Motion. 4 I. BACKGROUND 5 A. Factual Background 6 Plaintiffs allege the following in their Complaint: 7 Plaintiffs had an insurance policy with Defendant, 8 an insurance corporation, that was in effect from 9 September 29, 2018 to March 29, 2019 (the “Policy”). 10 Notice of Removal, Ex. A (“Compl.”) ¶ 5, ECF No. 1-1. 11 The Policy provided for Uninsured/Underinsured Motorists 12 (“UIM”) coverage with bodily injury limits of $250,000 13 per person and $500,000 per accident. Id. ¶ 6. On or 14 about November 17, 2018, Plaintiffs were involved in an 15 automobile accident in which their vehicle was struck by 16 an underinsured motorist, resulting in bodily injuries 17 to Plaintiffs that exceeded the maximum allowable policy 18 limits of the motorist who was at fault for the 19 collision.1 Id. ¶ 7. 20 On or about November 21, 2018, Plaintiffs reported 21 this loss and the injuries sustained to Defendant. Id. 22 ¶ 8. On May 14, 2019, Plaintiffs demanded Defendant 23 settle their claims for the UIM policy limits of 24 $250,000 as per each person. Id. ¶ 10. Defendant 25 refused and counter-offered $12,973.04 for Nosratollah 26 1 In or about May 2019, Plaintiffs settled their claims 27 against the underinsured motorist for his maximum allowable 28 policy limits, in an amount of $15,000 each. Id. ¶ 9. 2 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 3 of 13 Page ID #:291

1 Satvati’s (“Mr. Satvati”) claim and $1,000 for Farideh

2 Satvati’s (“Mrs. Satvati”) claim. Id. ¶ 12.

3 Ultimately, Mr. Satvati settled his claim on February 4 17, 2021 for the maximum available policy limit of 5 $235,000.002 whereas Mrs. Satvati arbitrated her claim, 6 receiving an award $48,873.60 on August 11, 2021. Id. 7 ¶¶ 18, 23. Defendant provided no explanation as to why 8 it took them 645 days to investigate Mr. Satvati’s 9 claim. Id. ¶ 24. Similarly, the arbitration process 10 for Mrs. Satvati’s claim took approximately 695 days due 11 to Defendant’s failure to cooperate. Id. ¶¶ 13-17, 22- 12 23. 13 Had Defendant agreed to settle Plaintiffs’ claims 14 for a fair amount within a reasonable time after 15 Plaintiffs served their initial settlement demand on May 16 14, 2019, Plaintiffs would not have incurred the 17 additional fees and costs associated with pursuing their 18 UIM claims against Defendants. Id. ¶ 27. Plaintiffs 19 incurred expenses for hiring experts, conducting a 20 deposition, arbitrator’s fees, court reporting fees, 21 increased attorneys’ fees due to being forced to resort 22 to arbitration, and various other costs. Id. ¶ 28. By 23 refusing to compensate Plaintiffs for their claims in a 24 timely and reasonable manner, Defendants acted 25 fraudulently and maliciously, subjecting Plaintiffs to 26 2 The amount Mr. Satvati received from the uninsured 27 motorist appears to be set off against the policy maximum of 28 $250,000.00. See Compl. ¶¶ 9, 18. 3 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 4 of 13 Page ID #:292

1 cruel and unjust hardship. Id. ¶ 29.

2 B. Procedural Background

3 Plaintiffs filed their Complaint [1-1] in the 4 Superior Court of California, County of Los Angeles on 5 August 20, 2021 [1-7]. On November 2, 2021, Plaintiffs 6 served Defendant with their Statements of Damages [1-5, 7 1-6]. 8 On November 10, 2021, Defendant removed [1] this 9 Action to this Court based on diversity jurisdiction. 10 Plaintiffs filed the instant Motion to Remand [7] on 11 December 10, 2021. Defendant filed its Opposition [10] 12 on December 21, 2021, and Plaintiffs replied [11] on 13 December 28, 2021. 14 II. DISCUSSION 15 A. Legal Standard 16 Civil actions may be removed from state court if 17 the federal court has original jurisdiction. See 18 Syngenta Crop Prot., Inc. v. Henson, 537 U.S. 28, 33 19 (2002) (“Under the plain terms of § 1441(a), in order 20 properly to remove [an] action pursuant to that 21 provision, . . . original subject-matter jurisdiction 22 [must] lie[] in the federal courts.”). Diversity 23 jurisdiction exists in all civil actions between 24 citizens of different states where the amount in 25 controversy exceeds $75,000, exclusive of interest and 26 costs. 28 U.S.C. § 1332. There must be complete 27 diversity of citizenship, meaning “each of the 28 plaintiffs must be a citizen of a different state than 4 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 5 of 13 Page ID #:293

1 each of the defendants.” Morris v. Princess Cruises,

2 Inc., 236 F.3d 1061, 1067 (9th Cir. 2001) (citing

3 Caterpillar Inc. v. Lewis, 519 U.S. 61, 68 (1996)). 4 Federal question jurisdiction exists in “all civil 5 actions arising under the Constitution, laws, or 6 treaties of the United States.” 28 U.S.C. § 1331. 7 “The burden of establishing jurisdiction falls on 8 the party invoking the removal statute, which is 9 strictly construed against removal.” Sullivan v. First 10 Affiliated Sec., Inc., 813 F.2d 1368, 1371 (9th Cir. 11 1987) (internal citations omitted). Courts resolve all 12 ambiguities “in favor of remand to state court.” Hunter 13 v. Philip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 14 2009) (citing Gaus v. Miles, Inc., 980 F.2d 564, 566 15 (9th Cir. 1992)). A removed case must be remanded “[i]f 16 at any time before final judgment it appears that the 17 district court lacks subject matter jurisdiction.” 28 18 U.S.C. § 1447(c). 19 B. Discussion 20 1. There Is Complete Diversity 21 a. Plaintiffs are California Citizens 22 “To demonstrate citizenship for diversity purposes 23 a party must (a) be a citizen of the United States, and 24 (b) be domiciled in a state of the United States.” Lew 25 v. Moss, 797 F.2d 747, 749 (9th Cir. 1986) (citations 26 omitted). “[A] person is domiciled in a location where 27 he or she has established a fixed habitation or abode in 28 a particular place, and intends to remain there 5 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 6 of 13 Page ID #:294

1 permanently or indefinitely.” Id. at 749-50 (citing

2 Owens v. Huntling, 15 F.2d 160, 162 (9th Cir. 1940). A

3 determination of an individual’s domicile may also 4 involve the consideration of a number of factors, 5 including: current residence, location of personal and 6 real property, location of brokerage and bank accounts, 7 location of spouse and family, place of employment or 8 business, driver’s license and automobile registration, 9 and payment of taxes. Id. at 750 (citation omitted). 10 Plaintiffs are domiciled in California here. 11 According to their Complaint, Plaintiffs currently 12 reside in California. Compl. ¶ 1. Further, Plaintiffs 13 owned a condominium in Canoga Park, California, that 14 Defendant insured for seventeen years. Declaration of 15 Glen Davis (“Davis Decl.”) ¶ 3, ECF No. 10-2. 16 Plaintiffs also purchased automobile insurance from 17 Defendant for twenty years and had their policies sent 18 to addresses in California. Id. Moreover, both the 19 condominium and insurance policies issued to Plaintiffs 20 showed California addresses. Id. Taken as a whole, 21 these facts evidence Plaintiffs’ fixed habitation in 22 California and Plaintiffs raise no facts casting doubt 23 on their intent to remain. Accordingly, Plaintiffs are 24 domiciled in California and are therefore citizens of 25 California. See Lew, 797 F.2d at 750 (“[D]omicile is 26 evaluated in terms of objective facts, and . . . 27 statements of intent are entitled to little weight when 28 in conflict with facts.”) (citations omitted); cf. 6 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 7 of 13 Page ID #:295

1 Nieratko v. Ford Motor Co., 2021 WL 4438397, at *2 (S.D.

2 Cal. Sept. 28, 2021) (finding sufficient an allegation

3 of California citizenship where it was coupled with a 4 leasing agreement listing the plaintiff’s address in 5 California); see also Banuelos v. Staples, Inc., 2015 WL 6 226029, at *5 (C.D. Cal. Jan. 16, 2015) (finding 7 California citizenship based on residency and employment 8 in California for over twenty years). 9 Plaintiffs argue that they are not citizens of 10 California by drawing a distinction between citizenship 11 and residency, Mot. 14:1-3, but this argument is 12 unavailing. While the Ninth Circuit has not expressly 13 adopted a presumption treating a person’s residence as 14 prima facie evidence of their domicile, it has 15 instructed that “courts should consider the entire 16 record to determine whether evidence of residency can 17 properly establish citizenship.” See Mondragon v. Cap. 18 One Auto Fin., 736 F.3d 880, 886 (9th Cir. 2013) 19 (citation omitted). As stated above, a consideration of 20 the entire record here, in addition to Plaintiffs’ 21 California residency, suggests that Plaintiffs are 22 indeed citizens of California. The Court finds that 23 Plaintiffs are California citizens. 24 25 /// 26 /// 27 /// 28 /// 7 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 8 of 13 Page ID #:296

1 b. Defendant Is a Citizen of Illinois 2 A corporation is a citizen of every State in which

3 it is incorporated and where it has its principal place 4 of business. 28 U.S.C. § 1332. A corporation’s 5 principal place of business is where its officers 6 “direct, control and coordinate the corporation’s 7 activities.” Hertz Corp. v. Friend, 559 U.S. 77, 92-93 8 (2010). The principal place of business is the 9 corporation’s “nerve center” and is normally where the 10 corporation maintains its headquarters, “provided that 11 the headquarters is the actual center of direction, 12 control, and coordination . . . .” Id. at 93. 13 Defendant is a citizen of Illinois here. 14 Defendant’s Vice President, Assistant General Counsel, 15 and Assistant Secretary Daniel Gordon declared based on 16 his personal knowledge that Defendant is “incorporated 17 under the laws of the State of Illinois” and Defendant’s 18 “principal place of business is in Cook County, 19 Illinois.” Declaration of Daniel G. Gordon (“Gordon 20 Decl.”) ¶ 1-2, ECF No. 10-4. Accordingly, by both its 21 state of incorporation and its principal place of 22 business, Defendant is a citizen of Illinois. See Koop 23 v. Amco Ins. Co., 2016 WL 3500121, at *3 (N.D. Cal. June 24 27, 2016) (accepting a declaration from a defendant’s 25 Vice President and Assistant Secretary to establish 26 state of incorporation and principal place of business). 27 Given that Plaintiffs are citizens of California 28 and Defendant is a citizen of Illinois, there is 8 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 9 of 13 Page ID #:297

1 complete diversity between the parties.

2 2. Defendant’s Notice of Removal was Timely

3 Typically, a defendant must file a notice of 4 removal within thirty days after service of the 5 complaint. 28 U.S.C. § 1446(b)(1). Where the case is 6 not initially removable, however, a defendant may file a 7 notice of removal within thirty days after receipt of 8 “an amended pleading, motion, order or other paper from 9 which it may first be ascertained that the case is one 10 which is or has become removable.” Id. § 1446(b)(3). 11 Under Ninth Circuit jurisprudence, the “thirty day 12 time period for removal starts to run from [a] 13 defendant’s receipt of the initial pleading only when 14 that pleading affirmatively reveals on its face the 15 facts necessary for federal court jurisdiction.” Harris 16 v. Bankers Life and Cas. Co., 425 F.3d 689, 690-91 (9th 17 Cir. 2005) (citations omitted). Accordingly, 18 removability under § 1446(b)(1) is analyzed through 19 “examination of the four corners of the applicable 20 pleadings, not through subjective knowledge or a duty to 21 make further inquiry.” Id. at 694. 22 Defendant’s Notice of Removal was timely here. The 23 Complaint did not specify an amount in controversy 24 whatsoever. See generally Compl. It was not until 25 Defendant received Plaintiffs’ Statements of Damages on 26 November 2, 2021, that Defendant was apprised of the 27 amount in controversy and that it exceeded $75,000. See 28 generally Statements of Damages, ECF Nos. 1-5, 1-6 9 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 10 of 13 Page ID #:298

1 (stating damages in excess of $2 million combined for

2 both Plaintiffs). Therefore, Plaintiffs’ Statements of

3 Damages constituted “other papers” from which 4 removability was first ascertainable under § 1446, and 5 Defendant removed this Action well within thirty days of 6 November 2, 2021, on November 10, 2021. See generally 7 Notice of Removal, ECF No. 1. 8 To avoid federal jurisdiction, Plaintiffs argue 9 that removal was untimely because Defendant should have 10 surmised from the Complaint that damages exceeded the 11 jurisdictional minimum. Mot. 17:17-18. Plaintiffs 12 state that a “reasonable amount of intelligence” would 13 have indicated that the Complaint exceeded the $75,000 14 threshold and therefore Defendant cannot “plead 15 ignorance.” Id. at 21:3-7. But courts in this circuit 16 have routinely stated that “[w]hen the face of the 17 complaint does not reveal whether the case is removable, 18 the defendant is not obligated to investigate the matter 19 within the initial 30 days to make this determination.” 20 Avans v. Foster Wheeler Const. Co., 2010 WL 3153972, at 21 *3 (E.D. Cal. Aug. 6, 2010); accord Kuxhausen v. BMW 22 Fin. Servs. NA LLC, 707 F.3d 1136, 1141 (9th Cir. 2013) 23 (“The fact remains, however, that we ‘don’t charge 24 defendants with notice of removability until they’ve 25 received a paper that gives them enough information to 26 remove.’” (quoting Durham v. Lockheed Martin Corp., 445 27 F.3d 1247, 1251 (9th Cir. 2006))); Riggs v. Cont'l 28 Baking Co., 678 F. Supp. 236, 238 (N.D. Cal. 1988) (“The 10 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 11 of 13 Page ID #:299

1 elements of removability must be specifically indicated

2 in official papers before the statutory period begins to

3 run.”). As such, Plaintiffs demands for attorneys’ 4 fees, emotional distress damages, and punitive damages 5 in the Complaint were not sufficient to put Defendant on 6 notice that the amount in controversy exceeded $75,000. 7 See, e.g., Washington v. Allstate Ins. Co., 2010 WL 8 4137286, at *1, 2 (E.D. Cal. Oct. 19, 2010) (holding 9 plaintiffs’ complaint “alleging special damages, general 10 damages, punitive damages, and attorney’s fees” after 11 four-year long arbitration wherein plaintiffs were 12 awarded $506,015 “[wa]s inadequate to provide a 13 defendant with notice that the amount in controversy 14 [exceeded $75,000]”); Bullard v. Allstate Ins. Co, 2006 15 WL 3734359, at *3-4 (N.D. Cal. Dec. 18, 2006) (holding 16 that a complaint alleging “various damages including the 17 costs of arbitration, emotional distress damages, 18 punitive damages, additional medical expenses, and lost 19 earnings” was insufficient to reveal an amount in 20 controversy exceeding $75,000). 21 In sum, the Complaint was not sufficient to trigger 22 the initial thirty-day removal period. Plaintiffs’ 23 Statements of Damages served on November 2, 2021 24 constitute “other papers” from which Defendant could 25 have first ascertained the removability of the 26 underlying litigation. Because Defendant’s Notice of 27 Removal was filed within thirty days of November 2, 28 2021, removal was timely. See, e.g., Avans, 2010 WL 11 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 12 of 13 Page ID #:300

1 3153972 at *7 (same). Given that the parties are

2 diverse, the jurisdictional amount is met, and removal

3 was timely, this Court has removal jurisdiction and 4 DENIES Plaintiffs’ Motion to Remand. 5 3. Sanctions 6 Both parties demand sanctions and the Court DENIES 7 both requests. 8 Plaintiffs argue Defendants should be sanctioned 9 for the erroneous removal of this case. Mot. 25:4-5. 10 Considering that removal was proper here, this request 11 is DENIED as moot. 12 Next, Defendants argue that Plaintiffs’ Motion for 13 Remand was frivolous and therefore sanctions or, 14 alternatively, an Order to Show Cause why sanctions 15 should not be imposed, is warranted. Opp’n 25:6-26:2. 16 The Court DENIES Defendant’s sanctions request given 17 that a separate motion for sanctions has not been filed. 18 Additionally, the Court DENIES Defendant’s request for 19 an Order to Show Cause why sanctions should not be 20 imposed against Plaintiffs for filing their Motion to 21 Remand considering that sanctions under Federal Rule of 22 Civil Procedure (“Rule”) 11 should be reserved for only 23 “rare and exceptional case[s] where the action is 24 clearly frivolous, legally unreasonable or without legal 25 foundation, or brought for an improper purpose.” 26 Operating Eng'rs Pension Trust v. A-C Co., 859 F.2d 27 1336, 1344 (9th Cir. 1988). 28 /// 12 Case 2:21-cv-08840-RSWL-PD Document 13 Filed 03/09/22 Page 13 of 13 Page ID #:301

1 III. CONCLUSION 2 Based on the foregoing, t h e Court DENIES Plaintiffs’ 3 Motion to Remand. The Court also DENIES each party’s 4 request for sanctions. 5 IT IS SO ORDERED. 6 7 8 DATED: March 9, 2022 _______/s_/ _R_on_a_ld_ S_._W_._ L_e_w__________ HONORABLE RONALD S.W. LEW 9 Senior U.S. District Judge 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 13