Bow v. Cebridge Telecom CA, LLC

[7] 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA [10] 11 KATHY BOW, ROBERT PAPP, and No. 2:21-cv-00444-TLN-JDP SUSAN WEISINGER, [12] Plaintiffs, 13 ORDER v. [14] CEBRIDGE TELECOM CA, LLC, d/b/a 15 Suddenlink Communications; ALTICE USA, INC.; CEQUEL 16 COMMUNICATIONS, LLC; CEBRIDGE ACQUISITION, L.P.; and CEQUEL III 17 COMMUNICATIONS I, LLC, 18 Defendants. [19] 20 This matter is before the Court on Plaintiffs Kathy Bow, Robert Papp, and Susan 21 Weisinger’s (“Plaintiffs”) Motion to Remand. (ECF No. 16.) Defendants Cebridge Telecom CA, 22 LLC, d/b/a Suddenlink Communications; Altice USA, Inc.; Cequel Communications, LLC; 23 Cebridge Acquisition, L.P.; and Cequel III Communications I, LLC (“Defendants”) filed an 24 opposition. (ECF No. 21.) Plaintiffs filed a reply. (ECF No. 24.) Also before the Court is 25 Defendants’ Motion to Compel Arbitration and Stay Litigation. (ECF No. 11.) Plaintiffs filed an 26 opposition. (ECF No. 17.) Defendants filed a reply. (ECF No23.) For the reasons set forth 27 below, the Court GRANTS Plaintiffs’ Motion to Remand, and DENIES Defendants’ Motion to 28 Compel as moot. 1 I. FACTUAL AND PROCEDURAL BACKGROUND 2 Defendants provide internet services to consumers in rural areas of California. (ECF No. 3 16 at 3.) On January 15, 2021, Plaintiffs filed a lawsuit in the Superior Court of California, 4 County of Nevada alleging that potential subscribers purchase Defendants’ internet services in 5 reliance on Defendants’ false promises in violation of the California Unfair Competition Law, [6] Cal. Bus. Prof. Code §§ 17200 et seq. (“UCL”); the California False Advertising Law, Cal. Bus. 7 & Prof. Code §§ 17500 et seq. (“FAL”); and the California Consumer Legal Remedies Act, Cal. 8 Civ. Code §§ 1750 et seq. (“CLRA”). (ECF No. 1-2.) Plaintiffs filed their First Amended 9 Complaint (“FAC”) on February 1, 2021, alleging the same causes of action. (ECF No. 1-2 at 10 37.) On March 11, 2021, Defendants removed the action to this Court pursuant to 28 U.S.C. §§ 11 1332, 1441, and 1446. (ECF No. 1 at 2.) 12 On April 15, 2021, Defendant Altice USA, Inc. filed a motion to compel arbitration (ECF 13 No. 11), which Plaintiffs oppose (ECF No. 17). On May 13, 2021, Plaintiffs filed a motion to 14 remand this action to state court (ECF No. 16), which Defendants oppose (ECF No. 21). Because 15 the Court remands this case, it declines to address Defendants’ motion to compel and the 16 arguments made therein in this order. 17 II. STANDARD OF LAW 18 A civil action brought in state court, over which the district court has original jurisdiction, 19 may be removed by the defendant to federal court in the judicial district and division in which the 20 state court action is pending. 28 U.S.C. § 1441 (a). The district court has jurisdiction over civil 21 actions between citizens of different states in which the alleged damages exceed $75,000. 28 22 U.S.C. § 1332 (a)(1). Removal based on diversity requires that the citizenship of each plaintiff be 23 diverse from the citizenship of each defendant (i.e., complete diversity). Caterpillar Inc. v. 24 Lewis, 519 U.S. 61, 68 (1996). For purposes of diversity, a corporation is a citizen of any state in 25 which it is incorporated and any state in which it maintains its principal place of business. 28 26 U.S.C. § 1332 (c)(1). An individual defendant’s citizenship is determined by the state in which 27 they are domiciled. Weight v. Active Network, Inc., 29 F. Supp. 3d 1289, 1292 (S.D. Cal. 2014). 28 / / / 1 “[I]n a case that has been removed from state court to federal court under 28 U.S.C. § 2 1441 on the basis of diversity jurisdiction, the proponent of federal jurisdiction — typically the 3 defendant in the substantive dispute — has the burden to prove, by a preponderance of the 4 evidence, that removal is proper.” Geographic Expeditions, Inc. v. Estate of Lhotka ex rel. 5 Lhotka, 599 F.3d 1102 , 1106–07 (9th Cir. 2010). “The preponderance of the evidence standard 6 applies because removal jurisdiction ousts state-court jurisdiction and ‘must be rejected if there is 7 any doubt as to the right of removal in the first instance.’” Id. (citation omitted). “This gives rise 8 to a ‘strong presumption against removal jurisdiction [which] means that the defendant always 9 has the burden of establishing that removal is proper.’” Id. (citation omitted). 10 III. ANALYSIS 11 Plaintiffs argue this case must be remanded because Plaintiffs’ FAC brings claims solely 12 seeking public injunctive relief under California law, which cannot satisfy Article III standing. 13 (ECF No. 16 at 3–4.) Defendants, in opposition, state they removed this case based on diversity 14 jurisdiction and further state Plaintiffs’ claims seek relief for their own benefit satisfying the 15 requirements for Article III standing. (ECF No. 21 at 2.) Defendants additionally argue that even 16 if a portion of Plaintiffs’ requested relief qualifies as a public injunction, the Court would still 17 have jurisdiction of Plaintiffs’ other requested relief — such as infrastructure improvements. (Id.) 18 Public injunctive relief, under California law, is “relief that by and large benefits the 19 general public and that benefits the plaintiff, if at all, only incidentally and/or as a member of the 20 general public.” McGill v. Citibank, N.A., 2 Cal. 5th 945, 955 (2017) (internal citations and 21 quotations omitted) (quoting Broughton v. Cigna Healthplans of Cal., 21 Cal. 4th 1066 , 1070 22 (1999)). “Based on the definition provided by the California Supreme Court [of public injunctive 23 relief as forth in McGill], a claim for ‘public injunctive relief’ cannot satisfy the three elements of 24 Article III standing.” McGovern v. U.S. Bank N.A., 362 F. Supp. 3d 850, 858 (S.D. Cal. 2019), 25 reconsideration granted on other grounds, 2020 WL 4582687 (S.D. Cal. Aug. 10, 2020). Article 26 III standing requires “[t]he plaintiff must have (1) suffered an injury in fact, (2) that is fairly 27 traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a 28 favorable judicial decision.” Spokeo, Inc. v. Robins, 578 U.S. 330, 338 (2016), as revised (May 1 24, 2016). With public injunctive relief, “[t]he problem lies with the third element — 2 redressability.” McGovern, 362 F. Supp. 3d at 858 . “The evident purpose of such relief . . . is not 3 to resolve a private dispute, but to remedy a public wrong.” Magana v. DoorDash, Inc., 343 F. 4 Supp. 3d 891, 900–01 (N.D. Cal. 2018) (citing McGill, 2 Cal. 5th at 961 ). Because such relief 5 does not remedy a plaintiff’s individual injury, the injury would not be redressed and thus there 6 would be no Article III standing. McGovern, 362 F. Supp. 3d at 858 . 7 At issue here is whether Plaintiffs’ requested relief meets the definition of “public 8 injunctive relief” or whether the relief sought is for private injunctive relief. One key difference 9 between a private and public injunction is the primary beneficiary of the relief. Private 10 injunctions “resolve a private dispute” between the parties and “rectify individual wrongs,” 11 though they may benefit the general public incidentally. Blair v. Rent-A-Ctr., Inc., 928 F.3d 819 , 12 824 (9th Cir. 2019). In contrast, public injunctions, as noted, benefit “the public directly by the 13 elimination of deceptive practices, but do not otherwise benefit the plaintiff, who has already 14 been injured, allegedly, by such practices and [is] aware of them.” Id. (quoting McGill, 2 Cal. 5th 15 955 ) (internal citations and quotations omitted). 16 Plaintiffs request an order: 17 i. Requiring that Suddenlink immediately cease acts that constitute unlawful, unfair, and fraudulent business practices, 18 false advertising, and violations of the Consumer Legal Remedies Act . . . and the False Advertising law as alleged 19 herein, and to enjoin Suddenlink from continuing to engage in any such acts or practices in the future, including, but not 20 limited to, making false representations about the speed of internet service that Suddenlink can and will provide; [21] ii. Requiring Suddenlink to disclose to Plaintiffs, current 22 subscribers, and the consuming public that its current infrastructure cannot and does not support the internet speeds 23 it advertises and contracts for and that its internet services are subject to frequent outages; [24] iii. Requiring Suddenlink to disclose to Plaintiffs, current 25 subscribers, and the consuming public the true download and upload speeds that its current infrastructure actually supports 26 for Suddenlink’s various service packages; 27 iv. Requiring Suddenlink to replace cables unable to carry data needed to support their subscribers’ highspeed internet 28 packages with higher quality fiberoptic cables throughout its 1 service area to support its internet service to its subscribers such that Plaintiffs, subscribers, and the consuming public 2 may actually receive the advertised internet speeds; 3 v. Requiring Suddenlink to install amplifiers along its current cables such that Plaintiffs, subscribers, and the consuming 4 public may actually receive the advertised internet speeds; 5 vi. Requiring Suddenlink to install additional nodes and related hardware throughout its infrastructure such that Plaintiffs, 6 subscribers and the consuming public may actually receive the advertised internet speeds; and [7] vii. Requiring Suddenlink to make any additional infrastructure 8 improvements necessary to provide reliable and consistent internet service at the advertised speeds and free from 9 avoidable outages. [10] 11 (ECF No. 1-2 at 57–58.) 12 Defendants argue Plaintiffs are requesting “infrastructure changes” for their own benefit. 13 (ECF No. 21 at 3–5.) Defendants fail to address Plaintiffs’ requests for relief as to requests i–iii, 14 and vii, other than a footnote in their opposition stating they dispute that “any of the relief 15 Plaintiffs seek actually qualifies as public injunctive relief . . . But because Plaintiffs’ argument 16 for remand fails even if some of their claims do seek public injunctive relief, [Defendants’] do[] 17 not address that issue further here.” (ECF No. 21 at 3.) Instead, Defendants maintain Plaintiffs’ 18 requests for infrastructure changes are sufficient to give the Court jurisdiction over the entire 19 action. (ECF No. 21 at 3.) 20 Defendants mischaracterize Plaintiffs’ requested relief. First, it is evident to the Court that 21 Plaintiffs’ requests that Defendants cease false advertising practices and disclose to current 22 subscribers its actual internet speeds and that its current infrastructure does not support such 23 speeds are requests for public injunctive relief. See Broughton, 21 Cal. 4th at 1080 (finding 24 deceptive methods, acts, and practices “generally benefit” the public “directly by the elimination 25 of deceptive practices” and “will . . . not benefit” the plaintiff “directly,” because they have 26 “already been injured, allegedly, by such practices and [is] aware of them”); Cruz v. PacifiCare 27 Health Sys., Inc., 30 Cal. 4th 303 , 315 (2003) (determining an injunction under the UCL or the [28] 1 | false advertising law against deceptive advertising practices “is clearly for the benefit of . . . the 2 | general public” and “is designed to prevent further harm to the public at large rather than to 3 | redress or prevent injury to a plaintiff’). 4 While Plaintiffs do request changes to infrastructure, the remedy sought is one that 5 | corrects the discrepancy between Defendants’ advertised internet speeds and the actual 6 | performance and infrastructure. (See ECF No. 1-2 at 57-58.) It is further clear Plaintiffs’ 7 | underlying request is for an end to deceptive practices as they state that Defendants “should either 8 | make its advertising truthful and not misleading or be required to make the improvements 9 | necessary to deliver on its promises.” (ECF No. 1-2 at 39 (emphasis added).) If Plaintiffs were 10 | requesting infrastructure changes just for their own homes or solely for current customers, this 11 | would not amount to public injunctive relief. See Hodges v. Comcast Cable Commc’ns, LLC, No. 12 | 19-16483, 2021 WL 6110309 , at *10 (9th Cir. Sept. 10, 2021) (determining claims did not 13 | constitute public injunctive relief because the relief sought benefits only for “cable subscribers” 14 | and not the public). 15 Here, Plaintiffs’ requests for relief aim to end Defendants’ alleged deceptive advertising. 16 || This is precisely the relief sought in Broughton and Cruz, where the courts found that the relief 17 || sought was a public injunction. Because Plaintiffs similarly seek public injunctive relief, there is 18 | no redressability in this Court. Accordingly, this action must be remanded to state court for 19 | further proceedings. 20 IV. CONCLUSION 21 For the foregoing reasons, Plaintiffs’ Motion to Remand (ECF No. 16) is GRANTED. 22 || This case is hereby remanded to the Nevada County Superior Court. Defendants’ Motion to 23 | Compel Arbitration and Stay Litigation CECF No. 11) is DENIED as moot. 24 IT IS SO ORDERED. 25 | DATED: February 1, 2022 ry /) 26 “ \/ of 27 a AN Troy L. Nunley } 28 United States District Judge