Diana Price v. Home Deport U.S.A., Inc.

1 JS-6 [7] 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA [10] 11 DIANA PRICE, Case No. 2:23-cv-03439-FLA (KSx) 12 Plaintiff, ORDER REMANDING ACTION FOR 13 v. LACK OF SUBJECT MATTER JURISDICTION [14] HOME DEPOT U.S.A., INC., et al., 15 Defendants. [28] 1 RULING 2 On March 29, 2023, Plaintiff Diana Price (“Plaintiff”) initiated this action 3 against Defendant Home Depot U.S.A., Inc. (“Defendant”), and DOES 1 through 50 4 in the Los Angeles County Superior Court. Dkt. 1-1 (“Compl.”). The Complaint 5 asserts various state-law claims for age discrimination and harassment, retaliation, 6 wrongful termination, negligent supervision, international infliction of emotional 7 distress, and violations of the California Labor Code. Id. 8 On May 5, 2023, Defendant removed the action to this court based on alleged 9 diversity jurisdiction. Dkt. 1. In its Notice of Removal, Defendant alleges the court 10 has subject matter jurisdiction under 28 U.S.C. § 1332 because the amount in 11 controversy exceeds $75,000. Id. On July 24, 2023, the court ordered the parties to 12 show cause (“OSC”) why the action should not be remanded for lack of subject matter 13 jurisdiction due to an insufficient amount in controversy. Dkt. 10. Only Defendant 14 filed a response (“Resp.”). Dkt. 14. 15 Having reviewed the Notice of Removal and Defendant’s response to this 16 court’s OSC, and for the following reasons, the court finds Defendant fails to establish 17 subject matter jurisdiction and accordingly REMANDS this action to the Los Angeles 18 County Superior Court. 19 DISCUSSION 20 Federal courts are courts of “limited jurisdiction,” possessing “only that power 21 authorized by the Constitution and statute[.]” Kokkonen v. Guardian Life Ins. Co. of 22 Am., 511 U.S. 375, 377 (1994); U.S. Const. art. III, § 2, cl. 1. District courts are 23 presumed to lack jurisdiction unless the contrary appears affirmatively from the 24 record. See DaimlerChrysler Corp. v. Cuno, 547 U.S. 332 , 342 n. 3 (2006). 25 Additionally, federal courts have an obligation to examine jurisdiction sua sponte 26 before proceeding to the merits of a case. See Ruhrgas AG v. Marathon Oil Co., 526 27 U.S. 574 , 583 (1999). 28 Federal courts have jurisdiction where an action arises under federal law or 1 where each plaintiff’s citizenship is diverse from each defendant’s citizenship and the 2 amount in controversy exceeds $75,000, exclusive of interest and costs. 28 U.S.C. 3 §§ 1331, 1332(a). Thus, a notice removing an action from state court to federal court 4 must include “a plausible allegation that the amount in controversy exceeds the 5 jurisdictional threshold.” Dart Cherokee Basin Operating Co., LLC v. Owens, 574 6 U.S. 81 , 89 (2014). Where “the plaintiff contests, or the court questions, the 7 defendant’s allegation” concerning the amount in controversy, “both sides [shall] 8 submit proof,” and the court may then decide whether the defendant has proven the 9 amount in controversy “by a preponderance of the evidence.” Id. at 88-89 . “Federal 10 jurisdiction must be rejected if there is any doubt as to the right of removal in the first 11 instance.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). It is Defendant’s 12 burden as the removing party to justify this court’s exercise of jurisdiction. Id. at 567 . 13 A. Plaintiff’s Settlement Offer and Statement of Damages 14 Here, Plaintiff’s Complaint does not identify a specific amount of damages. 15 See generally Compl. Defendant instead premises its basis for damages on a 16 settlement demand letter it received from Plaintiff’s counsel, agreeing to settle her 17 claims for $360,000. Resp. at 2-3. 18 Evidence of a settlement offer alone is insufficient for the court to find 19 Defendant has met the jurisdictional threshold, as the settlement demand letter offers 20 no evidence as to why Plaintiff’s offer to settle for $360,000 is a reasonable valuation 21 of her claims. See Owens v. Westwood College Inc., 2013 WL 4083624 , *4 (C.D. Cal. 22 2013) (finding plaintiff’s settlement demand letters could not be used to establish the 23 amount in controversy requirement because they “demand[ed] an arbitrary settlement 24 figure, with no showing of how [the] figure was calculated”). 25 Additionally, Defendant points to the parties’ prior drafts of their Rule 26(f) 26 Joint Report, in which Plaintiff estimated her damages to be $1,000,000. Resp. at 2-3. 27 While Defendant attaches a prior draft of the 26(f) Report demonstrating as such, the 28 final version of parties’ Joint Rule 26(f) Report filed in this court states only that 1 “Plaintiff seeks economic and non-economic damages to be determined at trial.” Dkt. 2 11 at 5. Even if the court were to consider the prior draft report, a statement of 3 damages “is relevant evidence of the amount in controversy if it appears to reflect a 4 reasonable estimate of the plaintiff’s claim.” Cohn v. Petsmart, Inc., 281 F.3d 837 , 5 840 (9th Cir. 2002). “A plaintiff’s damage estimate will not establish the amount in 6 controversy, however, if it appears to be only a bold optimistic prediction.” Romsa v. 7 Ikea U.S. West, Inc., Case No. 2:14-cv-05552-MMM (JEMx), 2014 WL 4273265 , *2 8 (C.D. Cal. 2014) (internal quotation marks omitted). 9 The $1,000,000 in damages asserted in the parties’ draft Joint Rule 26(f) Report 10 is nothing more than a “bold optimistic prediction” and is not a reasonable estimate of 11 Plaintiff’s claims. See id. (“The leap from $4,597.77 in medical expenses incurred to 12 [defendant’s] assertion that [plaintiff’s son] has suffered damages in excess of $75,000 13 because he cries a lot and wakes up several times a night is difficult to credit. 14 [Defendant] cites no facts that indicate a damages award anywhere near $75,000—let 15 alone $1,000,000—is likely.”). Again, neither party offers any explanation as to how 16 Plaintiff determined the $1,000,000 amount. See Romsa, 2014 WL 4273265 , at *2 17 (noting plaintiff’s statement of damages did not explain how he arrived at his figures); 18 Schroeder v. Petsmart, Inc., Case No. 2:19-cv-01561-FMO (AGRx), 2019 WL 19 1895573, *2 (C.D. Cal. 2019) (same); Mata v. Home Depot U.S.A., Inc., Case No. 20 2:22-cv-01758-FMO (AFMx), 2022 WL 3586206 , *2 (C.D. Cal. 2022) (same). 21 The court, therefore, declines to consider Plaintiff’s demand of $360,000 and 22 damages estimate of $1,000,000 for the purposes of determining the amount in 23 controversy and addresses Defendant’s remaining arguments. 24 B. Lost Wages 25 Defendant separately asserts at least $55,000 in claims for lost wages are in 26 controversy. In support of this claim, Defendant relies on its employee’s review of 27 Plaintiff’s earning statements to calculate past and future lost wages, but provides no 28 supporting evidence of such statements. The court, therefore, cannot sufficiently 1 determine whether Defendant has made a plausible allegation that the amount in 2 controversy exceeds the jurisdictional threshold. 3 By not producing any evidence to support its stated calculations, Defendant 4 fails to demonstrate by a preponderance of the evidence that any amount of lost wages 5 is in controversy. Nonetheless, even if the court were to accept Defendant’s 6 unsupported allegations as true, this amount without more is insufficient to meet the 7 jurisdictional threshold of $75,000. 8 C. Emotional Distress 9 Next, Defendant asserts the court should presume an unspecified amount in 10 emotional distress damages. Resp. at 6-7. To determine the amount of emotional 11 distress damages in controversy, courts consider the amount of emotional distress 12 damages awarded by juries in similar cases. Kroske v. U.S. Bank Corp., 432 F.3d 976 , 13 980 (9th Cir. 2005); Adkins v. J.B. Hunt Transp., Inc., 293 F. Supp. 3d 1140 , 1146-47 14 (E.D. Cal. 2018). “[T]he cases must be factually identical or, at a minimum, 15 analogous to the case at issue.” See Mireles v. Wells Fargo Bank, N.A., 845 F. Supp. 16 2d 1034, 1055 (C.D. Cal. 2012). 17 Courts are not required include emotional distress damages as part of the 18 amount in controversy when the party asserting jurisdiction fails to provide evidence 19 of jury awards from similar cases. Aguilar v. Wells Fargo Bank, N.A., Case No. 5:1520 cv-01833-AB (SPx), 2015 WL 6755199 , at *6 (C.D. Cal. Nov. 4, 2015); Rybalnik v. 21 Williams Lea Inc., Case No. 2:12-cv-04070-ODW (AGRx), 2012 WL 4739957 , at *3 22 (C.D. Cal. Oct. 4, 2012) (“[M]erely pointing to cases where juries have awarded hefty 23 damages sums in the past without further explanation . . . how the facts in those cases 24 compare to the facts presented here is . . . insufficient to meet [the] burden to establish 25 the amount in controversy by a preponderance of the evidence.”). 26 Although Defendant cites to a number of cases with emotional distress awards, 27 Defendant fails to provide an estimated amount of emotional distress damages, based 28 on the analogous cases it cites, and thus fails to demonstrate how the unspecified 1 amount of emotional distress damages would increase Plaintiff’s speculative lost 2 wages claim beyond $75,000. 3 D. Punitive Damages 4 Defendant’s inclusion of punitive damages is likewise speculative and 5 insufficient to meet its burden. “[T]he mere possibility of a punitive damages award 6 is insufficient to prove that the amount in controversy requirement has been met.” 7 Ogden v. Dearborn Life Ins. Co., --- F. Supp. 3d. ---, 2022 WL 17484616 , at *3 8 (D. Ariz. 2022). “Defendant must present appropriate evidence, such as jury verdicts 9 in analogous cases, to show that a claim for punitive damages establishes that it is 10 more likely than not that the amount in controversy exceeds $75,000.” Id. This 11 involves “articulat[ing] why the particular facts that are alleged in the instant action 12 might warrant extraordinary punitive damages.” Id. (quoting Haisch v. Allstate Ins. 13 Co., 942 F. Supp. 1245, 1249 (D. Ariz. 1996)). 14 Defendant fails to carry this burden and accordingly fails to show that any 15 particular amount of punitive damages is in controversy in this case. 16 E. Attorney’s Fees 17 Finally, Defendant argues the court should include attorney’s fees in its 18 calculation of the amount in controversy. Resp. at 8-9. “[W]here an underlying 19 statute authorizes an award of attorneys’ fees, either with mandatory or discretionary 20 language, such fees may be included in the amount in controversy.” Galt G/S v. JSS 21 Scandinavia, 142 F.3d 1150, 1156 (9th Cir. 1998). But a removing defendant must 22 “prove that the amount in controversy (including attorneys’ fees) exceeds the 23 jurisdictional threshold by a preponderance of the evidence,” and must “make this 24 showing with summary-judgment-type evidence.” Fritsch v. Swift Transp. Co. of 25 Ariz., LLC, 899 F.3d 785, 795 (9th Cir. 2018). “A district court may reject the 26 defendant’s attempts to include future attorneys’ fees in the amount in controversy if 27 the defendant fails to satisfy this burden of proof.” Id. [28] I Defendant fails to submit evidence of a reasonable amount of attorney’s fees or 2 || identify awards in other cases similar enough that the court can conclude it is more 3 | likely than not that Plaintiff may incur a similar fee award. 4 CONCLUSION 5 Given that any doubt regarding the existence of subject matter jurisdiction must 6 | be resolved in favor of remanding the action to state court, see Gaus, 980 F.2d at 566 , 7 | the court is not persuaded, under the circumstances here, that Defendant has met its 8 | burden of proving by a preponderance of the evidence that the amount in controversy 9 | meets the jurisdictional threshold. Therefore, there is no basis for diversity 10 | jurisdiction. See 28 U.S.C. § 1332 . 1] For the foregoing reasons, the court REMANDS the action to the Los Angeles 12 | County Superior Court, Case No. 23LBCV00570. All dates and deadlines in this 13 | court are VACATED. The clerk of the court shall close the action administratively. [14] 15 IT IS SO ORDERED. [16] 17 | Dated: September 20, 2023 18 S FERNANDO'L. AENLLE-ROCHA 20 United States District Judge