Rey v. Bristol Hospice, LLC

Opinion

DIANNA REY, et al., on behalf of themselves and all others similarly situated, Case No. 24-cv-04039-JD

Plaintiffs, SECOND ORDER RE REMAND v.

BRISTOL HOSPICE, LLC, et al., Defendants.

The Court denied without prejudice a request by plaintiff Rey to remand the case to California state court on the basis of the local controversy exception to CAFA jurisdiction with respect to defendant Optimal Health Services. Dkt. No. 34. Remand was denied because the complaint had been drafted for state court purposes and did not provide enough information for the Court to evaluate CAFA-specific issues such as the exception. Id. at 1 (citing Benko v. Quality Loan Service Corp., 789 F.3d 1111, 1117 (9th Cir. 2015)). Rey was granted leave to file an amended complaint to address the local controversy exception, and to file a renewed remand request. Id. at 2. The amended complaint added substantial new factual allegations about Optimal Health. See Dkt. No. 36. Rey filed a new request for remand on the basis of the amended complaint. Dkt. No. 37. The amended complaint plausibly alleges that the conduct of Optimal Health forms a significant basis of the claims and relief plaintiff seeks, and that greater than two-thirds of the members of the proposed classes in the aggregate are citizens of California. See 28 U.S.C. §§ 1332(d)(4)(A)(i)(I), (II)(bb). These are elements of the local controversy exception that remand motion, defendants contend only that a prior class action, Olmos v. Bristol Hospice - Inland Valley, LLC et al., Case No. 5:23-cv-02374-SVW (C.D. Cal. 2023), alleged similar facts and claims, and was filed within three years of the filing of this case. See Dkt. No. 40 at 5-9. If so, remand may be barred. See 28 U.S.C. § 1332(d)(4)(A)(ii) (permitting remand only if, “during the 3-year period preceding the filing of that class action, no other class action has been filed asserting the same or similar factual allegations against any of the defendants on behalf of the same or other persons.”). Defendants do not challenge application of the local controversy exception on any other basis. Olmos does not do the work that defendants ask of it. The parties treat the claims and facts in Olmos as similar to those here, and the Court will follow suit. The ECF docket maintained by the Central District of California indicates that Olmos was removed to federal court on November 20, 2023. Dkt. No. 1 (Case No. 5:23-cv-02374-SVW). Approximately eight weeks later, on January 18, 2024, the parties filed a joint stipulation stating that “[p]laintiff’s individual claims in this care [sic] are subject to binding arbitration” pursuant to an arbitration clause that also contained a class action waiver. Dkt. No. 18 at 3. On February 1, 2024, the district court ordered plaintiff to arbitration on her individual claims, and dismissed the class claims in toto. Id., Dkt. No. 19 at 2. The docket does not indicate that anything substantive happened in the way of motions or discovery and the like during the eight-week life of the case. The district court stayed the case pending arbitration of the plaintiff’s individual claims, as the Federal Arbitration Act requires. Id.; see Smith v. Spizzirri, 601 U.S. 472, 473-74 (2024). This is not a record that satisfies the plain language of Section 1332(d)(4)(A)(ii). “[T]he reason for the no prior class action prerequisite to remand is to ensure that controversies giving rise to multiple class actions be heard in federal court in one proceeding.” Kendrick v. Conduent State & Loc. Sols., Inc., 910 F.3d 1255, 1261 (9th Cir. 2018) (citing Bridewell-Sledge v. Blue Cross of California, 798 F.3d 923, 932 (9th Cir. 2015)). Olmos does not fit the bill as an “other class action” within the meaning of Section 1332(d)(4)(A)(ii) because the class allegations were dismissed at the very start of the litigation. It is certainly true, as defendants say, that Olmos was 1 at 1260. Consequently, as in Kendrick, “we are dealing with a single case, not two different class 2 actions proceeding on different tracks before different judges.” Jd. at 1261. 3 In light of this conclusion and the allegations in the amended complaint, there is “every 4 practical reason why the local action rule should apply” here. Id. The case is remanded to the 5 California Superior Court for the County of Alameda. Each side will bear its own attorney’s fees 6 and costs. 8 Dated: May 28, 2025 9 JAMES$PPONATO 10 Unitedgftates District Judge 11 a 12

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