Don't Tread on Us, LLC v. Twitter, Inc.

1 UNITED STATES DISTRICT COURT 2 NORTHERN DISTRICT OF CALIFORNIA [3] 4 DON'T TREAD ON US, LLC, Case No. 23-cv-02461-JD 5 Plaintiff, ORDER RE REMAND v. [6] 7 TWITTER INC., Defendant. [9] 10 Plaintiff Don’t Tread on Us, LLC (DTOU) sued defendant Twitter, Inc., for an alleged 11 breach of contract after Twitter declined to restore its accounts pursuant to an “amnesty” policy. 12 See Dkt. No. 1-1 ¶¶ 1, 24. DTOU originally sued in Florida state court. Twitter removed the 13 action to a federal court in Florida that subsequently transferred it to this Court. DTOU asks to 14 remand the case back to Florida state court and for an award of attorney’s fees incurred in 15 connection with the removal. Dkt. No. 35. The case was removed without jurisdiction, and is 16 remanded to state court. 28 U.S.C. § 1447 (c). The request for fees is denied. 17 The reason for the remand is straightforward. Twitter alleged federal subject matter 18 jurisdiction for removal purposes solely on the basis of diversity of citizenship. See Dkt. No. 1 at 19 2 (citing 28 U.S.C. § 1332 (a)). As the Court stated in a recent remand decision, “[d]iversity 20 jurisdiction arises when a plaintiff sues a citizen of a different state over an amount in controversy 21 exceeding $75,000.” Dole v. Verisk Analytics, Inc., No. 22-cv-06625-JD, 2023 WL 2985116 at *1 22 (N.D. Cal. Apr. 17, 2023) (citing 28 U.S.C. § 1332 (a)). “An out-of-state defendant may remove to 23 federal court ‘any civil action brought in a State court of which the district courts of the United 24 States have original jurisdiction.’” Id. (quoting 28 U.S.C. § 1441 (a)). “A plaintiff may move to 25 remand the action to state court if the case was improperly removed because of a lack of subject26 matter jurisdiction.” Id. (citing 28 U.S.C. § 1447 (c)). There is a “strong presumption against 27 removal jurisdiction,” Hansen v. Grp. Health Coop., 902 F.3d 1051, 1057 (9th Cir. 2018) (internal 1 Hawaii ex rel. Louie v. HSBC Bank Nev., N.A., 761 F.3d 1027, 1034 (9th Cir. 2014). “Principles 2 of federalism, comity, and respect for the state courts also counsel strongly in favor of 3 scrupulously confining removal jurisdiction to the precise limits that Congress has defined.” 4 California v. AbbVie, Inc., 390 F. Supp. 3d 1176, 1180 (N.D. Cal. 2019) (citing Shamrock Oil & 5 Gas Corp. v. Sheets, 313 U.S. 100, 109 (1941)). 6 The problem for Twitter is that it has not demonstrated that the case presents an amount in 7 controversy that exceeds the statutory threshold of $75,000. It is certainly true that a defendant’s 8 notice of removal “need include only a plausible allegation that the amount in controversy exceeds 9 the jurisdictional threshold,” and does not need evidentiary submissions to that effect. Anderson v. 10 Starbucks, Corp., 556 F. Supp. 3d 1132 , 1136 (N.D. Cal. 2020) (internal quotation and citation 11 omitted). But nothing in the complaint plausibly establishes that DTOU is seeking damages in 12 excess of $75,000. The complaint alleges a single claim for breach of contract that DTOU says 13 may “exceed the value of $50,000, exclusive of interest, court costs, and attorneys’ fees.” Dkt. 14 No. 1-1 ¶ 16. That is not enough to cross the statutory line. See Matheson v. Progressive 15 Specialty Ins. Co., 319 F.3d 1089, 1091 (9th Cir. 2003)) (“The complaint seeks ‘in excess’ of 16 $10,000 for economic loss, ‘in excess’ of $10,000 for emotional distress, and ‘in excess’ of 17 $10,000 for punitive damages, but how much ‘in excess’ is not explained.”). Prospective 18 attorney’s fees may be counted toward the jurisdictional amount when they are available by statute 19 or contract, see Anderson, 556 F. Supp. 3d at 1138, but neither the complaint nor removal notice 20 identifies any grounds for a potential award of fees that might take the amount in controversy 21 above $75,000. 22 Twitter’s main defense of removal is to rely on a civil cover sheet box that DTOU checked 23 stating that its claim was valued at “over $100,000.” Dkt. No. 1 at 3. But “[i]n determining the 24 amount in controversy, courts first look to the complaint. Generally, ‘the sum claimed by the 25 plaintiff controls if the claim is apparently made in good faith.’” Ibarra v. Manheim Invs., Inc., [26] 775 F.3d 1193, 1197 (9th Cir. 2015) (quoting St. Paul Mercury Indem. Co. v. Red Cab Co., 303 27 U.S. 283 , 289 (1938)). There is no evidence that the $50,000 figure in the complaint was not 1 by any facts in the complaint, and so is speculative and implausible for purposes of removal. 2 Twitter’s mention of a lost followers theory is equally speculative. Twitter relies on 3 || PhoneDog v. Kravitz, No. 11-cv-03474-MEJ, 2011 WL 5415612 , at *2 (N.D. Cal. Nov. 8, 2011), 4 || for the proposition that a dollar value may be placed on an account’s followers and aggregated for 5 || purposes of establishing the jurisdictional amount in controversy. Assuming purely for discussion 6 that this approach is valid, which the Court does not decide, Twitter did not present any evidence 7 of valuation for DTOU’s accounts or followers, or do any other legwork to substantiate removal 8 || on this basis. 9 The remaining issue is whether DTOU should be awarded the attorney’s fees and costs it 10 || incurred for the remand proceedings, as it requests. Dkt. No. 35 at 9. “An order remanding the 11 case may require payment of just costs and any actual expenses, including attorney fees, incurred 12 as aresult of the removal.” Healy v. FCA US LLC, No. 20-cv-01802-JD, 2020 WL 3868799 at *3 13 (N.D. Cal. Jul. 9, 2020) (quoting 28 U.S.C. § 1447 (c)) (quotation marks omitted). “The standard 14 || for awarding fees turns on the ‘reasonableness of the attempted removal.’” /d. (quoting Lussier v. 3 15 Dollar Tree Stores, Inc., 518 F.3d 1062, 1065 (9th Cir. 2008)). “‘Absent unusual circumstances,’ a 16 || the Court may award attorney’s fees under Section 1447(c) ‘where the removing party lacked an 3 17 objectively reasonable basis for seeking removal.’” /d. (quoting Martin vy. Franklin Capital Corp., [18] 546 U.S. 132, 141 (2005)). “But ‘removal is not objectively unreasonable solely because the 19 || removing party’s arguments lack merit, or else attorney’s fees would always be awarded whenever 20 || remand is granted.’” Id. (quoting Lussier, 518 F.3d at 1065 ). 21 As the record currently stands, the Court cannot say that Twitter’s removal petition was so 22 || objectively unreasonable as to warrant fees. Consequently, a fee award is denied. 23 The case is remanded to the Florida state court from which it was removed. All pending 24 || motions and deadlines are terminated as moot. 25 IT IS SO ORDERED. 26 Dated: January 3, 2024 [27] JAMES JPONATO 28 United pftates District Judge