Camper v. Safeway Inc

— 1 — — 2 — — 3 — — 4 — — 5 — UNITED STATES DISTRICT COURT 6 WESTERN DISTRICT OF WASHINGTON AT SEATTLE — 7 — HENRIETTA W. CAMPER, CASE NO. 2:23-cv-638 — 8 — Plaintiff, ORDER — 9 — v. — 10 — SAFEWAY, INC.; J.C. PENNEY 11 CORPORATION, INC., 12 Defendants. — 13 — 1. INTRODUCTION — 14 — This matter comes before the Court on Plaintiff Henrietta W. Camper’s — 15 — Objection to Defendant Safeway, Inc.’s Notice of Removal and Motion to Remand to — 16 — State Court. Dkt. No. 7. Having considered Camper’s request and Safeway’s — 17 — response, the Court GRANTS Camper’s motion. — 18 — 2. BACKGROUND — 19 — Camper alleges that she slipped and injured her knee inside a Safeway — 20 — grocery store in Seattle, Washington, in 2018. Dkt. No. 5-1 at 5 ¶ 3.2. Camper sued — 21 — Safeway in King County Superior Court and served Safeway with her complaint on — 22 — October 23, 2020. Dkt. No. 8 at 2 ¶ 6. For reasons that are unclear, Camper also — 23 — 1 named J.C. Penney Corporation as a defendant in the lawsuit. Dkt. No. 5-1 at 1. 2 Safeway served Camper with written discovery requests on November 20, 2020. 3 Dkt. No. 10 at 2 ¶ 4. On or about that same date, the state court stayed the matter 4 for co-defendant J.C. Penney’s bankruptcy proceedings. Dkt. No. 5-1 at 292 ¶ 3. It is 5 not clear from the record, which event occurred first—the stay or service of 6 Safeway’s discovery requests. 7 Safeway alleges Camper did not answer its discovery requests and that she 8 failed to provide a statement of her damages to Safeway pursuant to RCW 4.28.360 9 during the stay. Dkt. No. 10 at 2 ¶ 6. After two years, the automatic bankruptcy 10 stay was lifted and Safeway again requested a statement of damages and responses 11 to its discovery requests from Camper on January 10, 2023. Id. at 3 ¶ 7. Safeway 12 claims Camper did not respond to these requests or its efforts to schedule a 13 discovery conference. See id. ¶ 9. 14 On February 17, 2023, Safeway moved to compel Camper to disclose the 15 amount of damages she claimed for her injuries and for responses to its discovery 16 requests. Id. ¶ 10. On February 24, 2023, Camper responded, “Plaintiff will note 17 this case for mandatory arbitration and will stipulate to the MAR damages 18 limitation of $100,000.” Dkt. No. 5-1 at 338. In response to Safeway’s request for an 19 itemization of Camper’s medical treatment for her alleged injuries, Camper stated 20 “[t]his matter is still under investigation and this response will be supplemented. 21 Plaintiff currently does not know the exact amount of medical special damages 22 related to the subject incident,” and that she “is not making an income loss claim.” 23 Id. On March 13, 2023, the state court entered an order compelling Camper to 1 provide a statement of damages and to answer Safeway’s discovery requests “within 2 ten days.” Dkt. No. 5-1 at 345-6. 3 On March 23, 2023, Camper made a motion to move the matter to mandatory 4 arbitration. Dkt. No. 5-1 at 367. The next day, Camper moved the state court to 5 reconsider its order compelling her to produce a statement of damages and 6 responses to Safeway’s discovery requests. Dkt. No. 5-1 at 406. Camper claimed 7 that reconsideration was warranted because she served her discovery responses on 8 Safeway on February 24, 2023, which was only days after Safeway moved to compel 9 and before the hearing date on the motion. Id. at 410-412. Camper also argued 10 reconsideration was warranted because, “[t]o the extent there is continuing 11 disagreement as to the adequacy of our responses, the parties should first engage in 12 a discovery conference to try to resolve these differences before seeking further 13 Court assistance.” Id. at 412. The state court denied each of Camper’s requests. Dkt. 14 No. 5-1 at 400, 465; Dkt. No. 12 at 2 ¶ 9. 15 On April 5, 2023, Safeway requested a discovery conference with Camper to 16 discuss the amount of damages she claimed, but Camper’s counsel responded that 17 he would not be available until April 17, 2023. Dkt. No. 10 at 5 ¶ 18. Camper agreed 18 to submit the matter to mandatory arbitration with a maximum possible recovery of 19 $100,000. Dkt. No. 12 at 3 ¶ 12(2). On April 21, 2023, Camper provided Safeway an 20 amended response to Safeway’s request for statement of damages. Id. ¶ 14. In a 21 supplemental response to Safeway’s request for general damages, Camper 22 responded with the following: — 23 — 1 Plaintiff currently lacks sufficient information to determine the exact amount of general damages that will be claimed. In particular, some 2 medical treatment records have not been located. Based solely on information presently available, plaintiff intends to claim $200,000 in 3 general damages but is prepared to enter mandatory arbitration and is prepared to accept the jurisdictional limit of $100,000 in total damages. — 4 — Id. at 14. — 5 — Safeway filed its notice of removal to federal court from King County — 6 — Superior Court on May 1, 2023. Dkt. No. 1. Camper now claims that her claim is not — 7 — “likely to exceed $75,000 in total value,” and that she will “limit her claim to — 8 — $75,000 or less.” Dkt. Nos. 8 at 3 ¶ 14, 12 at 4 ¶ ¶ 17-19 . In a May 26, 2023, — 9 — amendment to her statement of damages, Camper limits her damages to $75,000. — 10 — Dkt. No. 12, Ex. C. — 11 — 3. ANALYSIS — 12 — 3.1. Legal standard. — 13 — Under 28 U.S.C. § 1441 (a), “[a] defendant generally may remove an action — 14 — filed in state court if a federal district court would have had original jurisdiction — 15 — over the action,” Chavez v. JPMorgan Chase & Co., 888 F.3d 413, 415 (9th Cir. — 16 — 2018), which may be based on diversity of parties when the amount in controversy — 17 — “exceeds the sum or value of $75,000, exclusive of interest and costs.” Gonzales v. — 18 — CarMax Auto Superstores, LLC, 840 F.3d 644, 648 (9th Cir. 2016) (citing 28 U.S.C. § 19 1332(a)) (cleaned up). The removal statute is “strictly construe[d] . . . against — 20 — removal jurisdiction.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). — 21 — “Federal jurisdiction must be rejected if there is any doubt as to the right of removal — 22 — in the first instance.” Id. Because there is a “strong presumption” against removal — 23 — 1 jurisdiction, “defendant[s] always ha[ve] the burden of establishing that removal is 2 proper.” Id. Removal must be timely. Fritsch v. Swift Transp. Co. of Arizona, LLC, — 3 — 899 F.3d 785, 788 (9th Cir. 2018). 4 There is no dispute about whether there is complete diversity between the 5 parties; rather, the questions before the Court are whether the amount-in6 controversy exceeds $75,000 and whether Safeway timely removed the action from 7 state court. 8 3.2. Safeway has met the amount-in-controversy threshold. 9 The Court first considers whether the amount in controversy meets the 10 jurisdictional threshold under 28 U.S.C. § 1332 (a). When it is unclear or ambiguous 11 from the state court complaint whether the amount-in-controversy pled meets the 12 jurisdictional threshold, it is the removing-defendant’s burden to establish by a 13 preponderance of the evidence the amount in controversy exceeds the threshold. 14 Urbino v. Orkin Servs. of Cal., Inc., 726 F.3d 1118 , 1121–22 (9th Cir. 2013) (citing 15 Guglielmino v. McKee Foods Corp., 506 F.3d 696, 699 (9th Cir. 2007)); Sanchez v. 16 Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996)). A defendant may point 17 to different types of evidence, but “[a] particularly powerful form of evidence is the 18 plaintiff’s own statements about the damages they seek.” Flores v. Safeway, Inc., 19 No. C19-0825-JCC, 2019 WL 4849488 , at *3 (W.D. Wash. Oct. 1, 2019) (citation 20 omitted). 21 Safeway argues that the amount in controversy meets the jurisdictional 22 threshold, pointing to Camper’s statements valuing her case about $75,000. Most — 23 — 1 notably, in her statement of damages made under RCW 4.28.360,1 Camper states, 2 “[b]ased solely on information presently available, plaintiff intends to claim 3 $200,000 in general damages but is prepared to enter mandatory arbitration and is 4 prepared to accept the jurisdictional limit of $100,000 in total damages.” Dkt. No. 5 10-1 at 2 (emphasis added). 6 After removing the case to federal court, however, Camper supplemented her 7 statement of damages, agreeing to “limit her total recovery … to a maximum of 8 $75,000.” Dkt. No. 12 at 14; see also Dkt. No. 8 at 3 ¶¶ 14, 17. Camper argues in her 9 motion that this lower estimate is supported by yet-to-be-obtained medical records 10 that would show one doctor’s visit and x-ray following her fall. Dkt. No. 8 at 2 ¶¶ 10, 11 11. Camper also claims that she is not seeking to recover for lost income. Id. ¶ 13 . 12 The Court finds Safeway has satisfied the amount in controversy 13 requirement for removal by relying on Camper’s statement of damages that she 14 intended to claim $200,000 in general damages. Flores, 2019 WL 4849488 , at *3 (“A 15 statement of damages made pursuant to § 360 is especially relevant evidence of how 16 the plaintiff values their case.”). This amount is not unreasonable given Camper’s 17 claims that she was “severely injured” by Safeway’s alleged negligence and that her 18 “injuries together with pain, discomfort and limitation of movement prevail and will 19 continue to prevail for an indefinite time into the future.” Dkt. No. 1-2 at 6 ¶ 3.7. 20 Camper’s supplemental damages disclosures, along with Camper’s counsel’s — 21 — 22 1 In relevant part, RCW 4.28.360 states: “A defendant in [any civil action for personal injuries] may at any time request a statement from the plaintiff setting 23 forth separately the amounts of any special damages and general damages sought.” 1 equivocal statements that her claim “may” be less than $75,000 or that she will 2 accept less than this amount, are perhaps an “attempt to game the system” to avoid 3 this Court’s jurisdiction. Sinclair v. Home Depot, U.S.A., Inc., No. C19-1971-JCC, — 4 — 2020 WL 6887914 , at *2 (W.D. Wash. Nov. 24, 2020). But this Court’s jurisdiction 5 was determined at the time the action commenced, at which point Camper claimed 6 $200,000 in damages, and the Court “is not divested of jurisdiction . . . [because] the 7 amount in controversy subsequently drops below the minimum jurisdictional level.” 8 Hill v. Blind Indus. & Servs. of Maryland, 179 F.3d 754, 757 (9th Cir.), opinion 9 amended on denial of reh’g, 201 F.3d 1186 (9th Cir. 1999). Safeway has met its 10 burden to show Camper’s claim met required amount in controversy under 28 11 U.S.C. § 1332 (a) at the time of removal. 12 3.3. Safeway’s removal was untimely under 28 U.S.C. § 1446 (c)(1). 13 The Court next considers Camper’s argument that Safeway’s notice of 14 removal was untimely based on 28 U.S.C. § 1446 (c)(1). The removal statute provides 15 “[a] case may not be removed under subsection (b)(3) on the basis of jurisdiction 16 conferred by section 1332 more than 1 year after commencement of the action, 17 unless the district court finds that the plaintiff has acted in bad faith in order to 18 prevent a defendant from removing the action.” 28 U.S.C. § 1446 (c)(1). If the court 19 finds the plaintiff “deliberately failed to disclose the actual amount in controversy to 20 prevent removal, that finding shall be deemed bad faith ….” 28 U.S.C. § 21 1446(c)(3)(B). 22 The Ninth Circuit has not clarified “bad faith” under 28 U.S.C. § 1446 (c). See 23 Herrington v. Nature Conservancy, No. CV 21-240-GW-GJSX, 2021 WL 942749 , at 1 *3 (C.D. Cal. Mar. 11, 2021). But “[i]n determining bad faith, courts have generally 2 inquired whether the plaintiff engaged in strategic gamesmanship designed to keep 3 the case in state court until the one-year deadline has expired.” Torres v. Honeywell, 4 Inc., No. 2:20-CV-10879-RGK-KS, 2021 WL 259439 , at *3 (C.D. Cal. Jan. 25, 2021) 5 (citing Heacock v. Rolling Frito-Lay Sales, LP, No. C16-0829-JCC, 2016 WL 6 4009849, at *3 (W.D. Wash. July 27, 2016); Aguayo v. AMCO Ins. Co., 59 F. Supp. 7 3d 1225, 1263 (D.N.M. 2014)). District courts have considered a plaintiff’s subjective 8 intent when taking action that inhibits removal. Heacock, LP, 2016 WL 4009849 , at 9 *2 (considering plaintiffs’ subjective intent in naming a non-diverse defendant). 10 Courts have also noted that bad faith ‘“carries with it a high threshold and entails 11 actions tantamount to recklessly raising a frivolous argument or disrupting and 12 hindering court proceedings.’” Heacock, 2016 WL 4009849 , at *2 (considering bad 13 faith in the context of awarding sanctions) (citing Escalante v. Burlington Nat. 14 Indem., Ltd., WL 6670002, at *3 (C.D. Cal. Nov. 24, 2014)). “The presumption 15 against removal, coupled with Ninth Circuit precedent holding that bad faith in the 16 sanctions context is a high burden,” has led courts in this district “to conclude that 17 defendants face a high burden to demonstrate that a plaintiff acted in bad faith to 18 prevent removal.” Id. at *3 . 19 Safeway’s removal comes one-year after Camper filed and served her 20 complaint, so it’s only hope of demonstrating that removal was proper under the 21 statute is showing that Camper acted in bad faith as that term is used in 28 U.S.C. 22 § 1446(c). Safeway falls short in this respect. — 23 — 1 Safeway points to no facts showing that Camper “engaged in strategic 2 gamesmanship designed to keep the case in state court until the one-year deadline 3 has expired” before the expiration of its deadline to remove this matter on October 4 23, 2021. See Torres, 2021 WL 259439 , at *3. According to Safeway’s papers in state 5 court, Defendant J.C. Penney gave notice that the matter was “subject to an 6 automatic stay related to its bankruptcy” on or about November 2, 2020—the same 7 day Safeway propounded its discovery requests to Camper. Dkt. No. 5-1 at 292 ¶ 3; 8 Dkt. No. 10 at 2 ¶ 4. Safeway argues Camper failed to respond to its requests, but 9 the record reflects that Camper made a timely request on December 2, 2020, for an 10 extension to respond to Safeway’s discovery requests. Dkt. No. 5-1 at 297. In 11 response, Safeway’s counsel acknowledged that the matter was stayed, “but [] it 12 would be helpful to us to determine potential records sources and start collecting 13 records if that is acceptable to you.” Id. at 296 . Safeway’s next email to Camper is 14 on April 1, 2021, requesting answers to Safeway’s discovery requests, including a 15 statement of damages. Id. Camper responded the same day that she will not 16 participate in further litigation on the case because of the bankruptcy stay. Id. at 17 295-6. Safeway does not appear to email Camper again until after the stay was 18 lifted on January 11, 2023. Id. at 295-6 . 19 Thus, Safeway oversells the notion that Camper “refused” to answer its 20 discovery requests during the stay. If Safeway disagreed with Camper’s position 21 about the stay, it failed to say as much at the time. See id. at 296 . Indeed, Safeway’s 22 response in its December 2, 2020, email (“[t]hat’s fine[;] [w]e are stayed by the 23 bankruptcy stay . . .”) implies it shared Camper’s view of the stay. See id. So it 1 cannot be said that Camper acted in bad faith to disrupt or hinder the proceedings 2 when Safeway made two requests to Camper, with minimal follow-up, before 3 October 23, 2021. Safeway focuses on Camper’s responses after this date; whether 4 Camper acted in bad faith after October 23, 2021, is immaterial under 28 U.S.C. § 5 1446(c) because Safeway’s deadline for removal had already passed. Dkt. No. 1,. 6 Ultimately, the stay, not Camper, prevented Safeway from removing this matter 7 before the one-year deadline. 8 Admittedly, J.C. Penney’s automatic bankruptcy stay placed Safeway in a 9 difficult position—Safeway did not know the amount in controversy at the time this 10 matter was filed and did not have time to learn of the amount through discovery by 11 the time the automatic stay was in place. See, e.g., Dkt. Nos. 5-1 at 11; 5 at 7 ¶ ¶ 12 4.1, 4.2; CR 33(a); CR 34(b)(3)(A); CR 36(a). Safeway’s briefing does not directly 13 address the effect of the bankruptcy stay, if any, on § 1446(c), nor does Safeway 14 argue that the one-year deadline should be tolled. See Dkt. No. 9. 15 There are scant cases on this subject in the Ninth Circuit and beyond. See 16 Nocelli v. Kaiser Gypsum Co., Inc., No. 19-CV-1980 (RA), 2020 WL 230890 , at *4-5 17 (S.D.N.Y. Jan. 15, 2020) (holding bankruptcy stay did not toll one-year time limit 18 under 28 U.S.C. § 1446 (c)(1)); see also Three Pirates, LLC v. Shelton Bros., Inc., No. 19 3:16-CV-01054-JE, 2016 WL 6534523 , at *4 (D. Or. Sept. 27, 2016), report and 20 recommendation adopted, No. 3:16-CV-01054-JE, 2016 WL 6561557 (D. Or. Nov. 1, 21 2016) (holding order staying state court proceedings did not create equitable 22 exception to 30-day limit for removal). — 23 — 1 The Ninth Circuit’s opinion in Patterson v. Int’l Bhd. of Teamsters, Loc. 959, — 2 — 121 F.3d 1345 , 1348–49 (9th Cir. 1997), is worth a closer look. There, a plaintiff 3 brought an action in state court against his former employer and his labor union as 4 well as various other defendants. Id. at 1348 . The state court dismissed the 5 plaintiff’s action against his former employer, but the state court stayed his action 6 against the union because it had earlier filed bankruptcy under 11 U.S.C. § 362 . Id. 7 The plaintiff’s action proceeded against the other defendants. Id. Once the 8 bankruptcy court permitted it, the union removed to federal court—six years after it 9 had received service of process in plaintiff’s lawsuit. Id. at 1348 . On appeal from the 10 district court’s denial of his motion to remand, plaintiff argued the union failed to 11 remove within 30 days of service under 28 U.S.C. § 1446 (b). The union argued that 12 it timely removed because it removed within 30 days of relief of the bankruptcy 13 court’s automatic stay. Id. The Ninth Circuit agreed with the debtor-union, holding 14 that “[i]f an automatic stay is in effect at the time the plaintiff files a state court 15 action . . . the thirty-day period for removal does not begin to run until relief is 16 obtained from the automatic stay.” Id. (citing Easley v. Pettibone Michigan Corp., — 17 — 990 F.2d 905 , 908–09 (6th Cir. 1993)). 18 Safeway does not argue for Patterson’s applicability to either 28 U.S.C. § 19 1446(b) or 1446(c), and if it had, it would not help here. When creating its exception 20 to § 1446(b), the Patterson court based its holding on the union’s status as the 21 debtor, reasoning that if the 30-day limit for removal began to run before the 22 bankruptcy stay was lifted in a case in which the stay was pending at the time — 23 — 1 lawsuit began, “a debtor [would] be forced to continue to litigate the claim, [and] the 2 purposes underlying the automatic stay would be thwarted.” Id. 3 Here, J.C. Penney, not Safeway, was the debtor. Further, as the Patterson 4 court notes—in passing—the state court proceedings continued as to the other 5 defendants; this implicitly suggests that actions against non-debtor defendants 6 could proceed. See id. This possibility is supported by more recent Ninth Circuit 7 bankruptcy courts holding that “[a]though the scope of the automatic stay is broad, 8 it does not stay all proceedings.” In re Palmdale Hills Prop., LLC, 423 B.R. 655 , 663 9 (B.A.P. 9th Cir. 2009), aff’d, 654 F.3d 868 (9th Cir. 2011). Safeway does not state, 10 and the record does not reflect, that Safeway ever tried to proceed against Camper 11 in any fashion, if even to pursue discovery about the amount-in-controversy or to 12 seek clarification from any court about the scope of the stay. The potential reach of 13 Patterson aside, the facts here suggest that non-debtor Safeway’s inaction, rather 14 than any alleged bad-faith conduct by Camper, foreclosed removal. 15 In any event, the Court declines to reframe Safeway’s arguments or to reach 16 issues not presented. The Court thus does not consider whether Safeway had a 17 viable argument for removal because of the stay, and considering Safeway’s “high 18 burden,” concludes that Safeway’s deadline to remove this matter to this court 19 expired one year after commencement of this action.2 — 20 — 2 While Safeway’s removal is barred, Camper’s argument that it was untimely 21 under 28 U.S.C. § 1446 (b)(1) fails. “[N]otice of removal may be filed within thirty days after receipt by the defendant . . . of . . . other paper from which it may first be 22 ascertained that the case is one which is . . . removable.” 28 U.S.C. § 1446 (b)(3). This deadline “only applies if the case stated by the initial pleading is removable on 23 its face.” Harris v. Bankers Life & Cas. Co., 425 F.3d 689, 694 (9th Cir. 2005). 1 4. CONCLUSION 2 Safeway’s removal is untimely under 28 U.S.C. § 1446 (c). The matter is to be 3 REMANDED. Safeway’s pending motion for contempt under Dkt. No. 14 is 4 STRICKEN as moot. 5 It is so ORDERED. — 6 — 7 Dated this 9th day of November, 2023. — 8 — A 9 Jamal N. Whitehead United States District Judge — 10 — — 11 — — 12 — — 13 — — 14 — — 15 — — 16 — — 17 — — 18 — — 19 — — 20 — — 21 — 22 Camper’s complaint did not include damages. Dkt. No. 1-2. Safeway could not have known Camper’s alleged damages until Camper produced the amended statement of 23 damages for $200,000 on April 21, 2023. See Dkt. No. 12 at 14.