Sergio Perez v. Charter Communications, LLC, et al.

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 SERGIO PEREZ, Case No. 25-cv-03761-EKL

8 Plaintiff, ORDER GRANTING MOTION TO v. 9 REMAND

10 CHARTER COMMUNICATIONS, LLC, et Re: Dkt. No. 17 al., 11 Defendants.

12 13 Plaintiff Sergio Perez initially filed this action in Monterey County Superior Court, 14 alleging that Defendants Charter Communications, LLC and related entities (collectively, 15 “Charter” or “Defendants”)1 fail to properly reimburse their customers for service interruptions or 16 outages. Perez seeks injunctive and declaratory relief based on alleged violations of California 17 state law. Before the Court is Perez’s motion to remand after Charter’s timely removal of this case 18 from state court. Perez argues that the Court does not have subject matter jurisdiction over his 19 claims under 28 U.S.C. § 1332 because Charter fails to demonstrate that the amount in 20 controversy exceeds $75,000. Having considered the parties’ briefs, related filings, and arguments 21 at the hearing, Perez’s motion is GRANTED. 22 I. BACKGROUND 23 Defendants are internet service providers with millions of customers nationwide, including 24 about five million customers in California. Decl. of Tracey Peters ¶ 5, ECF No. 23-2 (“Peters 25 Decl.”). At times, Charter customers experience service disruptions or outages for a host of 26

27 1 The related entities consist of Defendants Charter Communications Operating, LLC; Charter 1 reasons, some which are within the customers’ control (e.g., turning off their modems) and others 2 that are not (e.g., technical issues or natural disasters). Id. ¶ 7. Subject to certain terms and 3 conditions, “Charter will provide its customers credits when they experience qualifying outages of 4 Spectrum services lasting more than two hours.” Id. ¶ 9. Perez is one of Charter’s current 5 customers, who has received credits in five instances since January 2023, when he has requested 6 them. Id. ¶ 10. 7 On March 17, 2025, Perez filed this action against Charter in Monterey County Superior 8 Court. Perez seeks public injunctive relief under California’s Unfair Competition Law (“UCL”), 9 Cal. Bus. & Prof. Code § 17200 et seq.; California’s False Advertising Law, Cal. Bus. & Prof. 10 Code § 17500 et seq.; and California’s Consumers Legal Remedies Act (“CLRA”), Cal. Civil 11 Code § 1750 et seq., as well as declaratory relief and attorneys’ fees under California state law. 12 Notice of Removal Ex. A at 7-14, ECF No. 1-1 (“Compl.”). Perez seeks a “declaration that 13 Charter’s [reimbursement] policy is unlawful” and “a public injunction requiring Charter to 14 automatically refund affected customers for service fees incurred during known [service] 15 disruptions[,]” “to remove exculpatory language from customer contracts[,]” and to “provide clear 16 disclosures about the availability of refunds” in its advertising. Id. ¶ 7. On April 30, 2025, 17 Charter filed a timely notice of removal based on diversity jurisdiction under 28 U.S.C. § 1332(a). 18 Notice of Removal ¶ 13, ECF No. 1. On May 29, 2025, Perez filed a motion to remand this case 19 to state court. Mot. to Remand, ECF No. 17 (“Mot.”). On August 27, 2025, the Court held a 20 hearing on Perez’s motion. ECF No. 26. 21 II. LEGAL STANDARD 22 “Federal courts are courts of limited jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of 23 Am., 511 U.S. 375, 377 (1994). When an action is originally filed in state court, a “defendant may 24 remove [it] to federal court based on federal question jurisdiction or diversity jurisdiction.” 25 Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 (9th Cir. 2009) (citing 28 U.S.C. § 1441). But 26 there is a “‘strong presumption’ against removal jurisdiction,” and “the defendant always has the 27 burden of establishing that removal is proper.” Gaus v. Miles, 980 F.2d 564, 566 (9th Cir. 1992) 1 courts resolve “all ambiguity in favor of remand.” Hunter, 582 F.3d at 1042 (citation omitted). 2 Under 28 U.S.C. § 1332(a), diversity jurisdiction requires complete diversity and that the 3 amount in controversy “exceed[] the sum or value of $75,000[.]” Gonzales v. CarMax Auto 4 Superstores, LLC, 840 F.3d 644, 648 (9th Cir. 2016) (citation omitted). When the amount in 5 controversy is unclear based on the face of the pleadings, the removing party is required to 6 establish, by a preponderance of the evidence, that this requirement is met. Corral v. Select 7 Portfolio Serv’g, Inc., 878 F.3d 770, 774 (9th Cir. 2017) (collecting cases). “‘Conclusory 8 allegations as to the amount in controversy are insufficient.’” Id. (quoting Matheson v. 9 Progressive Specialty Ins. Co., 319 F.3d 1089, 1090-91 (9th Cir. 2003)). 10 If a plaintiff seeks declaratory or injunctive relief, courts determine the amount in 11 controversy by measuring “the value of the object of the litigation.” Id. at 775 (citation omitted); 12 Chapman v. Deutsche Bank Nat’l Tr. Co., 651 F.3d 1039, 1045 n.2 (9th Cir. 2011). Generally, the 13 amount in controversy encompasses, among other things, “the cost of complying with an 14 injunction, as well as attorneys’ fees awarded under fee shifting statutes.” Gonzales, 840 F.3d at 15 648-49 (citing Chabner v. United of Omaha Life Ins. Co., 225 F.3d 1042, 1046 n.3 (9th Cir. 16 2000)). 17 III. DISCUSSION 18 In his motion to remand, Perez argues that this case should be remanded on four different 19 bases: lack of subject matter jurisdiction, lack of equitable jurisdiction, lack of Article III 20 standing, and abstention principles. Because the Court holds that it lacks subject matter 21 jurisdiction, the Court does not reach Perez’s other bases for remand but denies Perez’s request for 22 attorneys’ fees.2 23 A. The Court Lacks Subject Matter Jurisdiction Over Perez’s Claims. 24 As it is undisputed that complete diversity exists between the parties, the sole question 25 before the Court is whether the amount in controversy exceeds $75,000 for purposes of subject 26 2 After the hearing, Charter filed a statement of recent decision relating to the issue of equitable 27 jurisdiction. ECF No. 28. Perez filed a motion to strike Charter’s statement, ECF No. 29, which 1 matter jurisdiction. Because the complaint does not “seek a specific dollar amount in damages,” 2 and the amount in controversy is not otherwise clear from the face of the complaint, Charter bears 3 the burden to prove the amount in controversy by a preponderance of the evidence. Corral, 878 4 F.3d at 774. 5 Perez seeks a public injunction, requiring Charter to automatically refund its customers for 6 service disruptions for which it is responsible and to change related policies and advertisements. 7 Compl. ¶ 7. According to Charter, the requested injunction would impose costs stemming from 8 (1) implementation of a system that would identify all service outages and their causes; 9 (2) providing refunds when customers experience service outages that are Charter’s responsibility; 10 and (3) changing its advertisements to address service disruptions and the availability of and 11 means by which to obtain refunds. Opp. to Mot. to Remand at 4-6, ECF No. 23 (“Opp.”). Charter 12 urges the Court to calculate the amount in controversy by considering the costs of complying with 13 the injunction as to all Charter customers. Id. at 4-5. In the alternative, Charter maintains that 14 even the costs of affording relief to Perez individually would exceed $75,000. Id. at 9-10. 15 In order to address Charter’s arguments, the Court begins by addressing the preliminary 16 question of whether the anti-aggregation principle, which has been applied in the class-action 17 context, should apply in public injunction cases, and relatedly whether the “either viewpoint” rule 18 should be considered. The Court then turns to whether the cost of compliance with the injunction 19 that is sought in this matter and the potential award of attorneys’ fees would exceed $75,000. The 20 Court ultimately concludes that Charter has failed to demonstrate that the amount in controversy is 21 greater than $75,000, thus requiring remand of this case. 22 1. Framework for Calculating Amount in Controversy 23 The threshold question is whether the amount in controversy is Charter’s costs of 24 compliance with the proposed injunction as to all its customers, or whether the Court may 25 consider only costs related to affording Perez injunctive relief on an individual basis. Charter 26 urges the Court to apply the “either viewpoint” rule, and to reject the application of the anti- 27 aggregation principle in this case. 1 Anti-Aggregation Principle: In class actions where plaintiffs seek solely injunctive relief, 2 courts have applied the anti-aggregation principle, which prevents courts from aggregating the 3 damages corresponding to each plaintiff’s claim in determining the amount in controversy. 4 McCauley v. Ford Motor Co. (In re Ford Motor Co./Citibank (S.D.), N.A.), 264 F.3d 952, 958-59 5 (9th Cir. 2001). The application of this rule turns on whether “each plaintiff is asserting an 6 individual right or, rather, together the plaintiffs ‘unite to enforce a single title or right in which 7 they have a common and undivided interest.’” Id. at 959 (quoting Snyder v. Harris, 394 U.S. 332, 8 335 (1969)). If plaintiffs seek to enforce a common and undivided interest in a “single title or 9 right” (e.g., a piece of property), the Court may aggregate the costs of complying with the 10 injunction as to all plaintiffs when calculating the amount in controversy. Id. On the other hand, 11 if the plaintiffs each assert an individual right, “the test is the cost to the defendants of an 12 injunction running in favor of one plaintiff.” Id. (citation omitted). 13 Charter argues that Perez’s objection to aggregation here is irrelevant since this is a single- 14 plaintiff case. “Courts that have examined the issue generally find that” because public injunction 15 cases under the UCL and CLRA seek relief “on behalf of numerous individuals, the claims are 16 sufficiently akin to class actions that the prohibition against aggregation” applies. Enriquez v. 17 Sirius XM Radio, Inc., No. 21-cv-1240, 2022 WL 4664144, at *4 (E.D. Cal. Sep. 30, 2022) 18 (collecting cases); see also Doe v. Aetna, Inc., No. 17-cv-07167, 2018 WL 1614392, at *4-6 (N.D. 19 Cal. Apr. 4, 2018) (“Because the instant case does not involve a common and undivided interest or 20 a single res, the Court considers the cost to [defendant] of complying with the [public UCL] 21 injunction vis-à-vis [the individual plaintiff] only[.]”).3 22 23 24 3 Charter cites Boyle v. Yellow Social Interactive Ltd, which determined that actions seeking public 25 injunctive relief are private, as opposed to representative, actions. No. 25-cv-00063, 2025 WL 885101, at *5 (C.D. Cal. Mar. 20, 2025) (declining to apply the anti-aggregation rule, and instead 26 applying the either-viewpoint rule, because there was “only one plaintiff and no separate and distinct claims to aggregate”). The Court, however, declines to follow Boyle, and adopts the 27 approach taken by the majority of the district courts in the Circuit, finding that actions seeking 1 In this case, the Court finds that this action does not involve “a single indivisible res,” nor 2 “a right with a common and undivided interest.” Jaimes v. Am. First Fin. LLC, No. 23-cv-00978, 3 2023 WL 6783774, at *3 (N.D. Cal. Oct. 12, 2023) (quoting Ford, 264 F.3d at 959). If granted, 4 the public injunction would require Charter to establish a process through which each customer 5 could obtain automatic refunds. Each customer would receive a separate refund contingent on the 6 particular service outage(s) each customer experiences. Each customer’s interest in a refund is 7 highly individualized; thus, customers do not share a “common and undivided” interest in the 8 relief Perez seeks. Accordingly, in determining whether the amount in controversy is over 9 $75,000, the Court looks to the cost of Charter’s compliance with the public injunction solely as to 10 Perez. Enriquez, 2022 WL 4664144, at *5 (“There is nothing before the Court that suggests that 11 the rights at issue are anything other than individual ‘non-unified’ rights[,] [so] the costs of the 12 injunction to [defendant] cannot be aggregated[.]”). 13 “Either Viewpoint” Rule: Relatedly, Charter urges the Court to apply the “either 14 viewpoint” rule, which would require the Court to consider the total costs to Charter of complying 15 with the injunction. “Under the ‘either viewpoint’ rule, the test for determining the amount in 16 controversy is the pecuniary result to either party which the judgment would directly produce.” 17 Ford, 264 F.3d at 958 (citing Ridder Bros. Inc., v. Blethen, 142 F.2d 395, 399 (9th Cir. 1944)). 18 This rule, however, is inapplicable where – as here – a plaintiff seeks public injunctive relief and 19 there is no common and undivided interest among the plaintiff and the others impacted. Enriquez, 20 2022 WL 4664144, at *4-5 (collecting cases); see also Ford, 264 F.3d at 958-59 (acknowledging 21 “the inherent conflict between the ‘either viewpoint’ rule and the non-aggregation rule when 22 calculating the amount in controversy in class action suits seeking equitable relief,” and noting 23 “that the former must yield” (citing Snow v. Ford Motor Co., 561 F.2d 787, 788-791 (9th Cir. 24 1977))). Accordingly, the Court declines to apply the “either viewpoint” rule. Instead, the Court 25 looks only to Charter’s costs of complying with the injunction as to Perez. 26 2. Cost of Compliance 27 Charter claims the costs it would incur based on “an injunction running in favor of just 1 to “proactively identify every outage and its duration,”4 and the cost of changing its advertising to 2 inform customers of the service disruption refund program. Id. at 10. Both arguments are 3 unavailing for two reasons. 4 First, each of the costs that Charter relies on are fixed administrative costs, which the 5 Court may not consider for purposes of calculating the amount in controversy. Enriquez, 2022 6 WL 4664144, at *4 (citing Ford, 264 F.3d at 960-61; Doe, 2018 WL 1614392, at *6). Again, the 7 Ninth Circuit’s decision in Ford is instructive. In Ford, the defendants argued that “the fixed 8 costs to Ford and Citibank of reinstating and maintaining” a rebate accrual “program would be the 9 same whether it is done for one plaintiff or for six million.” 264 F.3d at 960. The Ninth Circuit 10 rejected this argument, noting that if “the administrative costs of complying with an injunction 11 were permitted to count as the amount in controversy, ‘then every case, however trivial, against a 12 large company would cross the threshold.’” Id. at 961 (quoting In re Brand Name Prescription 13 Drugs Antitrust Litig., 123 F.3d 599, 610 (7th Cir. 1997)) (declining to apply the “either viewpoint 14 rule” to administrative costs to establish the jurisdictional amount). The court emphasized that 15 counting administrative costs would be “fundamentally violative of the principle underlying the 16 jurisdictional amount requirement – to keep small diversity suits out of federal court.” Id. The 17 same reasoning applies here. Any expense that Charter would incur from needing “to further 18 develop [its] technology” to better detect outages and to change its advertising are administrative 19 costs. Opp. at 10. These types of fixed administrative costs cannot be considered for the purpose 20 of calculating the amount in controversy. 21 Second, even if the Court could consider administrative costs, Charter does not provide 22 sufficient information from which the Court could determine the costs that Charter would incur. 23

24 4 Specifically, Defendants allege they cannot identify why their service outages or disruptions occurred, if a customer turns off their modem or if the electricity shuts off. Opp. at 5 (citing Peters 25 Decl. ¶ 12). This allegedly requires them to develop and implement technology that could distinguish between these situations and service outages that are their fault. Id. (citing Peters Decl. 26 ¶¶ 13-16). However, Charter has not shown that a new, costly system to detect the source of outages would be required to afford Perez injunctive relief. The complaint alleges – and 27 Defendants do not appear to contest – that Charter is required to report known service outages to 1 See Harville v. Richman Prop. Servs., No. 24-cv-07832, 2024 WL 4557665, at *5-6 (C.D. Cal. 2 Oct. 22, 2024) (finding that, where defendant did not explain how “the cost of its leasing and 3 application software relates to the costs that would be incurred to comply with a hypothetical 4 injunction requiring changes to its rental applications,” it did not provide a “basis for the Court to 5 determine what that amount should be”). Charter does not provide any monetary estimates – other 6 than the bald assertion that the cost would be above $75,000, Opp. at 4-6, 9-10 – or any details 7 from which the Court could evaluate the appropriateness of including any expenses related to 8 complying with the injunction when calculating the amount in controversy. Harville, 2024 WL 9 4557665, at *6; see also Corral, 878 F.3d at 774. Thus, Charter provides no basis for the Court to 10 determine what amounts should be considered for purposes of the jurisdictional analysis. 11 Accordingly, the Court finds Charter does not meet its burden to establish the amount in 12 controversy requirement is met, based on its cost of compliance with the public injunction Perez 13 seeks.5 14 3. Attorneys’ Fees 15 The Court must also “include future attorneys’ fees recoverable by statute or contract when 16 assessing whether the amount-in-controversy requirement is met.” Fritsch v. Swift Transp. Co. of 17 Ariz., LLC, 899 F.3d 785, 794 (9th Cir. 2018) (collecting cases). The defendant bears the burden 18 to prove the amount of attorneys’ fees at stake by a preponderance of the evidence with 19 “summary-judgment-type evidence.” Id. at 795 (collecting cases). Where, as here, a plaintiff only 20 seeks public injunctive relief and there is no common and undivided interest, courts may solely 21 consider the plaintiff’s “pro rata share of the fees, i.e. his share of the fees of the California 22 consumers/subscribers who would benefit from the public injunction[.]” Enriquez, 2022 WL 23 4664144, at *6 (collecting cases). 24 5 Notably, Charter does not argue that refunding Perez for additional service outages would 25 impose significant costs. To the contrary, in its opposition, Charter explains that Perez has reported service disruptions in five instances since 2023 and has received a total of about $20 in 26 credits as a result. Opp. at 5 (citing Peters Decl. ¶ 10). As discussed, the Court may not consider administrative costs for purposes of calculating the amount in controversy. The refunds Charter 27 would provide to Perez are the only costs identified by Defendants which would be non- 1 In the notice of removal, Charter asserts that, “[a]ssuming an hourly rate of around $350 2 per hour,” Perez’s attorneys’ fees would exceed $75,000 “if Perez’s attorneys . . . spen[t] at least 3 215 hours total on this case . . . , which they inevitably would have to do to litigate this case to 4 final judgment.” Notice of Removal ¶ 37 (“In comparable cases, Perez’s own attorneys have 5 requested attorneys’ fees in excess of $75,000 to settle cases, and courts have awarded them such 6 amounts upon finding the requests to be reasonable.” (citing cases)). This argument does not 7 account for the non-aggregation principle, and Charter fails to provide a pro rata estimation of 8 attorneys’ fees. Because Perez’s pro rata share is unknown, the Court finds that Charter has not 9 met its burden as to the amount in controversy.6 Enriquez, 2022 WL 4664144, at *6 (“Because 10 the Court resolves all doubt and ambiguity concerning attorneys’ fees against [defendant], the pro 11 rata share is less than $75,000[.]” (citations omitted)). 12 * * * 13 In sum, Charter has failed to meet its burden to demonstrate that the amount in controversy 14 requirement is satisfied. The Court remands this case based on a lack of diversity jurisdiction 15 pursuant to 28 U.S.C. § 1447(c). 16 B. Perez is Not Entitled to Attorneys’ Fees. 17 Under 28 U.S.C. § 1447(c), a court may award attorneys’ fees if the removing party 18 “lacked an objectively reasonable basis for seeking removal.” Martin v. Franklin Capital Corp., 19 546 U.S. 132, 141 (2005) (citations omitted). Among other considerations, “the degree of clarity 20 in the relevant law at the time of removal is a relevant factor in determining whether a defendant’s 21 decision to remove was reasonable.” Grancare, LLC v. Thrower by and Through Mills, 889 F.3d 22 543, 552 (9th Cir. 2018) (citation omitted). 23 Perez argues that Charter’s “removal was improper” because it “is completely unsupported 24 6 Even if the Court were to consider the full sum of potential attorneys’ fees, Charter’s argument 25 still falls short. Charter generally alleges that “Perez’s fee request alone exceeds $75,000” based on “the attorney hours that would be needed” to “litigate this case through trial.” Opp. at 6. But 26 Charter offers no support for this assertion, and it “makes no effort to explain how” the other cases brought by Perez’s counsel are “comparable to this one.” Harville, 2024 WL 4557665, at *4. 27 Charter’s conclusory statements are insufficient to show by a preponderance of the evidence that ] by evidence of the amount in controversy or diversity.” Mot. at 14. He also asserts that “[t]he 2 || legal principles and caselaw cited throughout [Charter’s] brief were well-known before [Charter] 3 improvidently removed this case, and [Charter] should be liable for the waste occasioned by that 4 || decision.” /d. at 15. The Court finds that Charter’s removal was not objectively unreasonable. As 5 discussed above, the amount in controversy here turns on whether the anti-aggregation rule applies 6 || to claims for public injunctive relief, which the Ninth Circuit has not squarely addressed. Thus, 7 || Charter’s arguments were not objectively unreasonable. See Grancare, 889 F.3d at 552; see also 8 || Lussier v. Dollar Tree Stores, Inc., 518 F.3d 1062, 1065 (9th Cir. 2008) (“[R]emoval is not 9 || objectively unreasonable solely because the removing party’s arguments lack merit, or else 10 || attorney’s fees would always be awarded whenever remand is granted.”). Consequently, Perez is 11 not entitled to recover attorneys’ fees. %L IV. CONCLUSION 13 For the foregoing reasons, Perez’s motion to remand is GRANTED. IT IS SO ORDERED. 3 15 || Dated: February 2, 2026

umi K. Lee 18 United States District Judge 19 20 21 22 23 24 25 26 27 28