Gomez v. Bradford ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 TIBURCIO S. GOMEZ, JR., an individual, No. 2:20-cv-00506-TLN-DB 12 Plaintiff, 13 v. ORDER 14 PETER B. BRADFORD, an individual; JANET M. BRADFORD, an individual; 15 MAYFLOWER FARMS, INCORPORATED, a California 16 corporation; and DOES 1–50, inclusive, 17 Defendants. 18 19 20 This matter is before the Court on Plaintiff Tiburcio Gomez, Jr.’s (“Plaintiff”) Motion to 21 Remand. (ECF No. 4.) Defendants Peter Bradford (“Bradford”), Janet Bradford, and Mayflower 22 Farms, Inc. (“Mayflower”) (collectively, “Defendants”) filed an opposition (ECF No. 7), and 23 Plaintiff filed a reply (ECF No. 9). For the reasons set forth below, the Court GRANTS 24 Plaintiff’s motion. (ECF No. 4.) 25 /// 26 /// 27 /// 28 /// 1 I. FACTUAL AND PROCEDURAL BACKGROUND 2 Mayflower employed Plaintiff in 1964 to assist in its agricultural operations. (ECF No. 1- 3 1 at 5.) Plaintiff’s responsibilities grew over the next decade, and he was ultimately promoted to 4 a management position. (Id.) Bradford, acting as President of Mayflower, requested Plaintiff to 5 commit to long-term employment with Mayflower in 1976. (Id.) In return, Bradford allegedly 6 promised he and Mayflower would establish a retirement account for Plaintiff and make yearly 7 contributions as part of Plaintiff’s pay and benefits. (Id.) Plaintiff, relying on Bradford’s verbal 8 promise, agreed. (Id.) The same year, Bradford opened an annuity through Aetna Variable 9 Annuity Life Insurance Company (the “Annuity”) for Plaintiff’s benefit, as allegedly agreed 10 upon. (Id.) Bradford contributed $1,976.91 to the Annuity, which was to be the approximate 11 amount of each yearly contribution. (Id. at 6.) The Annuity was due and payable upon retirement 12 in 2008 or when Plaintiff turned 65. (Id.) Plaintiff was scheduled to retire in 2008 but continued 13 working for Defendants until 2016 when Bradford terminated him for being a “liability” after 14 suffering a workplace injury. (Id. at 6–7.) Plaintiff requested his retirement benefits under the 15 Annuity upon termination, but Defendants denied his request. (Id. at 7–8.) Ultimately, Plaintiff 16 discovered that Defendants failed to fund the Annuity. (Id. at 8.) 17 As a result, Plaintiff filed this action on February 6, 2019, in Colusa County Superior 18 Court alleging claims for promissory fraud and breach of contract. (ECF No. 1-1.) Plaintiff 19 attached the Annuity to his Complaint as “Exhibit A.” (Id. at 13–35.) Defendants removed the 20 action to this Court on March 5, 2020. (ECF No. 1.) Plaintiff filed a motion to remand on April 21 3, 2020. (ECF No. 4.) Defendants filed an opposition on April 30, 2020 (ECF No. 7), and 22 Plaintiff filed a reply on May 7, 2020 (ECF No. 9). 23 II. STANDARD OF LAW 24 Any civil action which “the district courts of the United States have original jurisdiction” 25 may be removed from state court to federal court. 28 U.S.C. § 1441(a). Removal is authorized 26 “only where original federal jurisdiction exists.” Caterpillar Inc. v. Williams, 482 U.S. 386, 393 27 (1987). District courts have original federal jurisdiction over suits with diversity of citizenship or 28 with claims that arise under federal law. Id. at 392–93; see also Merrell Dow Pharm. Inc. v. 1 Thompson, 478 U.S. 804, 808–09 (1986). 2 “The presence or absence of federal-question jurisdiction is governed by the ‘well-pleaded 3 complaint rule,’ which provides that federal jurisdiction exists only when a federal question is 4 presented on the face of the plaintiff’s properly pleaded complaint.” Caterpillar Inc., 482 U.S. at 5 392 (citing Gully v. First Nat’l Bank, 299 U.S. 102, 112–13 (1936)). Removal cannot be based 6 on a defense or counterclaim raising a federal question, whether filed in state court or federal 7 court. See Vaden v. Discover Bank, 556 U.S. 49, 60 (2009); Hunter v. Philip Morris USA, 582 8 F.3d 1039, 1042–43 (9th Cir. 2009). “The . . . plaintiff [is] the master of the claim; he or she may 9 avoid federal jurisdiction by exclusive reliance on state law.” Caterpillar Inc., 482 U.S. at 392. 10 An exception to the “well-pleaded complaint rule” is complete preemption, or “when a 11 federal statute wholly displaces the state-law cause of action.” Beneficial Nat’l Bank v. Anderson, 12 539 U.S. 1, 8 (2003). “When the federal statute completely [preempts] the state-law cause of 13 action, a claim which comes within the scope of that cause of action, even if pleaded in terms of 14 state law, is in reality based on federal law.” Id. The Ninth Circuit has termed this exception the 15 “artful pleading” doctrine. Hall v. N. Am. Van Lines, Inc., 476 F.3d 683, 687 (9th Cir. 2007). 16 A plaintiff may move to remand, challenging the defendant’s removal of an action to 17 federal court. 28 U.S.C. § 1447. Courts “strictly construe the removal statute against 18 removal jurisdiction,” and “the defendant always has the burden of establishing that removal is 19 proper.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (per curiam). Furthermore, “[i]f 20 the district court at any time determines that it lacks jurisdiction over the removed action, it must 21 remedy the improvident grant of removal by remanding the action to state court.” California ex 22 rel. Lockyer v. Dynegy, Inc., 375 F.3d 831, 838, as amended, 387 F.3d 966 (9th Cir. 2004), cert. 23 denied, 544 U.S. 974 (2005). 24 III. ANALYSIS 25 Defendants removed the instant action based on federal question jurisdiction, arguing the 26 Employee Retirement Income Security Act (“ERISA”) preempts Plaintiff’s state law claims. (See 27 ECF No. 1.) “ERISA regulates employee benefit plans in order to promote the interests of 28 employees and their beneficiaries.” Bast v. Prudential Ins. Co. of Am., 150 F.3d 1003, 1007 (9th 1 Cir. 1998). ERISA is an exception to the well-pleaded complaint rule, as it is a federal statute 2 that “wholly displaces the state-law cause of action through complete [preemption].” Aetna 3 Health v. Davila, 542 U.S. 200, 207 (2004). ERISA is comprised of “a comprehensive civil 4 enforcement scheme that ‘would be completely undermined if ERISA-plan participants and 5 beneficiaries were free to obtain remedies under state law that Congress rejected in ERISA.’” Id. 6 (quoting Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 54 (1987)). “[A] state law cause of action is 7 preempted by ERISA if it ‘relates to’ an employee benefit plan.” Bast, 150 F.3d at 1007 (internal 8 citation omitted). More specifically, “a court must evaluate whether the state law ‘has a 9 connection with or reference to’ employee benefit plans.” Id. (internal citation omitted). The 10 Ninth Circuit has held ERISA preempts state law tort and contract claims, state law insurance 11 statute violation claims, and state law wrongful death claims (based on an insurance company’s 12 negligent administration). Id. at 1007–08. 13 Plaintiff moves to remand the instant action to state court, arguing (1) this Court does not 14 have subject matter jurisdiction because Plaintiff’s claims do not fall within the scope of ERISA 15 and (2) Defendants’ removal to this Court is untimely because the employee benefit plan 16 implicating ERISA could be determined from the face of the Complaint. (See ECF Nos. 4-1, 9.) 17 As the Court finds that Plaintiff’s timeliness argument has merit, it declines to address Plaintiff’s 18 first argument. 19 A defendant may remove an action filed in state court within two periods: (1) within 30 20 days after receipt by the defendant of the initial pleading; or (2) within 30 days after receipt of “a 21 copy of an amended pleading, motion, order or other paper from which it may first be ascertained 22 that the case is one which is or has become removable.” 28 U.S.C § 1446(b). “[N]otice of 23 removability under § 1446(b) is determined through examination of the four corners of the 24 applicable pleadings, not through subjective knowledge or a duty to make a further inquiry.” 25 Harris v. Bankers Life and Cas. Co., 425 F.3d 689, 694 (9th Cir. 2005). “[T]he first thirty-day 26 requirement is triggered by defendant’s receipt of an ‘initial pleading’ that reveals a basis for 27 removal” or “the facts necessary for federal court jurisdiction.” Id. at 690, 694 (citing Chapman 28 v. Powermatic, Inc., 969 F.2d 160, 163 (5th Cir. 1992); Lovern v. Gen. Motors Corp., 121 F.3d 1 160, 162 (4th Cir. 1997)). However, an initial pleading “that is ‘indeterminate’ on its face will 2 not trigger the 30-day window for removal.” Veillette v. Renown Health, No. 3:14-cv-00327- 3 RCJ-VPC, 2014 WL 5286517, at *4 (D. Nev. Oct. 15, 2014). “If it becomes ascertainable that an 4 action is removable from a subsequent ‘amended pleading motion, order or other paper,’ the 30- 5 day window to remove begins upon the defendant’s receipt of such ‘paper.’” Id. (quoting 28 6 U.S.C. § 1446(b)). The rule requires “a defendant to apply a reasonable amount of intelligence in 7 ascertaining removability,” but not to “make extrapolations or engage in guesswork.” Kuxhausen 8 v. BMW Fin. Servs. NA LLC, 707 F.3d 1136, 1140 (9th Cir. 2013) (quoting Whitaker v. Am. 9 Telecasting, Inc., 261 F.3d 196, 206 (2d Cir. 2001)). 10 Defendants argue in opposition that grounds for removal became apparent only after their 11 own investigation because the Complaint and subsequent documents were indeterminate as to 12 federal question jurisdiction.1 (ECF No. 7 at 14, 18–19; see also ECF No. 1 at 2.) Defendants 13 note that “[c]omplete preemption under ERISA is not so obvious that [D]efendants were ‘put on 14 notice’ of it by [P]laintiff attaching retirement annuity documents to his [C]omplaint.” (ECF No. 15 7 at 18.) Defendants therefore assert that neither of the 30-day removal periods were triggered 16 under § 1446(b) because “an express allegation of federal question jurisdiction” was not raised on 17 the face of the Complaint or in a subsequent document. (Id.) Thus, Defendants contend removal 18 was timely under Roth v. CHA Hollywood Med. Ctr., L.P., 720 F.3d 1121, 1125–26 (9th Cir. 19 1 In support of this assertion, Defendants cite to Miller v. Grgurich, 763 F.2d 372, 373 (9th 20 Cir. 1985). However, Miller is factually distinct with respect to the instant case, as it deals with questions of a plaintiff’s citizenship at the time of removal for the purposes of diversity 21 jurisdiction. 763 F.2d at 373. 22 In Defendants’ argument about Plaintiff’s Complaint and other documents being 23 “indeterminate” regarding federal jurisdiction, Defendants also note their counsel “was not aware of the possible implications of federal preemption under ERISA until he was interviewing 24 potential expert witnesses for the case.” (ECF No. 7 at 18.) Indeed, the declaration submitted by their counsel, Steven C. Sabbadini, notes that as he was interviewing potential experts in January 25 2020, he “was informed about the possibility that ERISA may have some bearing on the issues in the case.” (ECF No. 7-1 at 3.) Mr. Sabbadini contends that only after his co-counsel’s review 26 and “investigation of ERISA statutory provisions and relevant case law” — which occurred 27 sometime after the mediation in February 2020 — did Defendants remove the action. (Id.) 28 1 2013), despite the deadlines prescribed in § 1446(b).2 (Id. at 17–19.) 2 Plaintiff asserts in reply that “[t]he statutory thirty-day time period for removal of this 3 action started to run when Defendants received the Complaint, as the face of the [C]omplaint 4 revealed the facts necessary to ascertain whether there was federal court jurisdiction.” (ECF No. 5 9 at 9.) Plaintiff notes that Defendants’ opposition quotes the terms and details of the Aetna 6 retirement plan attached to the Complaint. (Id. at 9 n.8.) 7 Plaintiff is correct that his Complaint includes allegations that explicitly detail the 8 retirement annuity promised by Defendants. (ECF No. 4-1 at 17.) Specifically, the Complaint 9 alleges: 10 • “Defendants would fund a retirement account for [Plaintiff] and make yearly 11 contributions to that account into the future as part of Plaintiff’s pay and benefits, 12 and would do so for as long as Plaintiff remained employed by Defendants” (ECF 13 No. 1-1 at ¶ 10); 14 • “Defendants promised to (and initially did) open and fund an annuity issued by 15 Aetna Variable Annuity Life Insurance Company to be due and payable upon 16 retirement age of 65 or the year 2008. Defendants funded the annuity with an 17 initial contribution of $1,976.91, which was to be the approximate amount of each 18 annual contribution, depending on Plaintiff’s wages and inflation” (id. at ¶ 11); 19 • “On or about July 30, 1976, Plaintiff filled out and signed an application to Aetna 20 Variable Annuity Life Insurance Company with an effective date of January 1, 21 1976” (id. at ¶ 12); and 22 • “Plaintiff . . . was listed as the annuitant of the annuity bearing a date of issuance 23 of January 1, 1976, contract no. 178472 with the owner of the annuity listed as the 24 Trustees of Peter B. Bradford Self Employed Retirement Plan and Trust” (id. at ¶ 25 2 The Ninth Circuit held in Roth that removal beyond the two time periods prescribed under 26 § 1446(b) is permissible if the defendant did not run afoul of either time period and conducted an 27 investigation giving rise to the grounds for removal. 720 F.3d at 1123, 1125. Here, the Court finds removal untimely because Defendants ran afoul of the time periods in § 1446(b) — the 28 Complaint was not indeterminate. Defendants are thus precluded from relying on Roth. 1 13). 2 Defendants cannot argue based on the foregoing allegations that Plaintiff’s Complaint 3 fails to give Defendants notice of removability. Plaintiff specified the details of the retirement 4 plan at issue. Cf. Kernan v. Health Care Servs. Corp., No. 2:18-CV-02491-ODW (SKx), 2018 5 WL 3046961, at *2–4 (C.D. Cal. Jun. 19, 2018) (finding a single paragraph detailing how 6 plaintiff obtained his plan was insufficient to put defendant “on notice that [plaintiff] was suing to 7 enforce rights arising from an employee benefit plan, thus triggering the completely pre-emptive 8 effect of ERISA.”). Plaintiff’s claims are premised on the withholding of the promised benefits 9 and the allegations with respect to these benefits covered by ERISA have been present since 10 Plaintiff filed his Complaint more than two years ago. See Hoeft v. Time Warner Cable, Inc., No. 11 LA CV18-00293 JAK (MRWx), 2018 WL 2078814, at *4 (C.D. Cal. May 2, 2018) (concluding 12 defendants failed to show a subsequent deposition “raised matters that could not have been 13 determined from a reasonable assessment of [plaintiff’s] allegations” and noting “the allegations 14 relating to benefits covered by ERISA were present for almost two years prior to removal, and it 15 did not require ‘extrapolations or guesswork,’ to have linked them to the benefits available under 16 ERISA plans.” (quoting Kuxhausen, 707 F.3d at 1140).). Defendants have also failed to persuade 17 the Court that their grounds for removal — “the investigation of ERISA statutory provisions and 18 relevant case law” (ECF No. 7-1 at 3) — are based on anything more than a reiteration of 19 Plaintiff’s allegations in his Complaint. See Veillette v. Renown Health, No. 3:14-cv-00327-RCJ- 20 VPC, 2014 WL 5286517, at *4 (D. Nev. Oct. 15, 2014) (finding grounds for removal were 21 “arguably no more than a reiteration of [p]laintiff’s allegations in the [c]omplaint . . . the basis for 22 [defendant’s] removal was ascertainable on the face of [p]laintiff’s [c]omplaint, thus making 23 [defendant’s] removal untimely.”). 24 For these reasons, the Court agrees with Plaintiff that the Complaint clearly implicated an 25 employee benefit plan as defined by ERISA. Because the Court finds the basis for federal 26 question jurisdiction was clearly ascertainable on the face of the Complaint, Defendants’ 27 purported failure to perceive the applicability of ERISA within the permissible time period is 28 irrelevant. 1 As such, the Court finds Defendants’ receipt of the Complaint triggered the 30-day 2 | deadline under § 1446(b). Defendants failed to comply with § 1446(b) because they filed their 3 | Notice of Removal (ECF No. 1) more than 30 days after they received the Complaint. Hence, 4 | Defendants’ removal of this action is untimely. Based on the foregoing, as well as the “strong 5 | presumption” against removal, Gaus, 980 U.S. at 566, the Court GRANTS Plaintiff's Motion to 6 | Remand. 7 IV. CONCLUSION 8 For the foregoing reasons, Plaintiff's Motion for Remand (ECF No. 4) is hereby 9 | GRANTED. This case is remanded to Colusa County Superior Court and the Clerk of the Court 10 || is directed to close the case. 11 IT IS SO ORDERED. ry /) “ \/ lhe 13 | DATED: August 23, 2021 — MN NS Z 4 Troy L. Nunley . } United States District Judge 15 16 17 18 19 20 21 22 23 24 25 26 27 28