Nico Cruz v. Mohawk Industries, Inc. ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 NICO CRUZ, individually and on behalf of No. 1:20-cv-01510-NONE-EPG 12 other members of the general public similarly situated, 13 Plaintiff, ORDER GRANTING DEFENDANTS LEAVE 14 TO FILE SUPPLEMENTAL BRIEFING v. CONCERNING MOTION TO REMAND 15 MOHAWK INDUSTRIES, INC., et al., (Doc. No. 7) 16 Defendants. 17 18 Plaintiff Nico Cruz filed a putative class-action complaint in the Fresno County Superior 19 Court against defendants Mohawk Industries, Inc., Daltile Services, Inc., Dal-Tile Services, Inc., 20 and Dal-Tile Corporation on September 14, 2020. (Doc. No. 1-2.) Defendants removed the 21 action to this court on October 23, 2020, invoking federal jurisdiction under the Class Action 22 Fairness Act of 2005 (“CAFA”). (Doc. No. 1.) On November 23, 2020, plaintiff filed a motion 23 to remand. (Doc. No. 7.) Defendants filed an opposition and a request for judicial notice on 24 December 30, 2020. (Doc. Nos. 10 & 11.) Plaintiff did not file a reply brief. 25 The court has conducted a preliminary analysis and is inclined to grant plaintiff’s motion 26 to remand. Defendants have established by a preponderance of the evidence, that the amount in 27 controversy with respect to plaintiff’s first, second, third, fourth (as to unpaid wages and 28 liquidated damages), and ninth causes of action are, cumulatively, $4,109,869. Defendants’ 1 calculations for plaintiff’s fourth (as to penalties), fifth, and seventh causes of action assume a 2 100% violation rate. That assumption is impermissible given plaintiff’s pattern-and-practice 3 allegations and defendants’ failure to provide a rationale for such a violation rate. See Ibarra v. 4 Manheim Investments, Inc., 775 F.3d 1193, 1198–99 (9th Cir. 2015). In addition, defendants 5 have not met their burden of showing that the court should assume plaintiff will be entitled to an 6 additional 35% for attorneys’ fees. See Arias v. Residence Inn by Marriott, 936 F.3d 920, 927–28 7 (9th Cir. 2019) (holding defendants carry such burden); Bell v. NuSil Tech. LLC, No. 1:20-cv- 8 00061-NONE-JLT, 2021 WL 1208013, at *5–6 (E.D. Cal. Mar. 31, 2021) (finding that 9 defendants failed to justify 25% rate for attorneys’ fees). Defendants have provided evidence that 10 in other similar cases that have settled, plaintiff’s counsel requested 35% of the settlement to be 11 paid to his firm for attorneys’ fees. This is insufficient. “[D]efendant[s] must prove the amount 12 of attorneys’ fees at stake by a preponderance of the evidence” using summary-judgment-style 13 evidence. Fritsch v. Swift Transp. Co. of Az., LLC, 899 F.3d 785, 796 (9th Cir. 2018). 14 Defendants have shown by a preponderance of the evidence that, in settlements, plaintiff’s 15 counsel seeks to be awarded 35% of the fund as attorneys’ fees. But here, defendants are 16 attempting to show the amount in controversy based not on a potential settlement but on what the 17 prospective class might receive if successful on the merits. Thus, noting that plaintiff’s counsel 18 has asked to be awarded a portion of a settlement fund as attorneys’ fees does not meet 19 defendants’ evidentiary burden in this regard. See also id. (declining to “hold that, as a matter of 20 law, the amount of attorneys’ fees in controversy in class actions is 25 percent of all other alleged 21 recovery” and requiring removing defendant to prove the amount of attorneys’ fees at stake with a 22 view to “the applicable contractual or statutory requirements that allow fee-shifting in the first 23 place”). 24 Defendants do not provide proposed amounts in controversy as to plaintiff’s sixth, eighth 25 and tenth causes of action, and defendants have requested an order granting leave to file 26 supplemental briefing if helpful to the court. (See Doc. No. 10 at 19.) The court “has broad 27 discretion to allow parties to supplement the record.” NAACP Legal Def. & Educ. Fund, Inc. v. 28 Barr, 496 F. Supp. 3d 116, 126 n.2 (D.D.C. 2020) (granting leave to supplement to provide 1 | additional facts not available at time of original filing). “The Federal Rules of Civil Procedure do 2 | not require a district court to allow amendments to a motion, but rather a district court has 3 | discretion to grant or deny such amendments.” Hupp v. Switzerland of Ohio Loc. Sch. Dist., 912 4 | F. Supp. 2d 572, 604 (S.D. Ohio 2012) (citations omitted). “[T]here is no reason to deny the 5 | amendment when the trial judge believes it would be in the interests of justice to permit it.” 5 6 | Arthur R. Miller, et al., Fed. Prac. & Proc. Civ. § 1194 (3d ed.). The court finds that the interests 7 | of justice will be served by permitting the supplemental filing in this instance. 8 Defendants may file supplemental briefing concerning only the above-mentioned causes 9 | of action and issues within thirty days. Plaintiff may file a reply brief concerning only the 10 | supplemental briefing within fourteen days thereafter.' 11 | IT IS SO ORDERED. am 12 ‘Le ft. © Dated: _ September 22, 2021 eK | ee 13 UNITED STATES DISTRICT JUDGE 14 15 16 17 18 19 20 21 SA ' Should the parties file supplemental briefing, the court will turn its attention to the motion to 23 | remand without further delay. This will maintain the present priority of that motion vis-a-vis other pending motions, which generally are being addressed in the order in which they were submitted. The undersigned apologizes for the excessive delay in this case. This court’s 25 || overwhelming caseload has been well publicized and the long-standing lack of judicial resources in this district long-ago reached crisis proportion. That situation, which has continued unabated 26 | for over nineteen months now, has left the undersigned presiding over more than 1300 civil cases and criminal matters involving 735 defendants at last count. Unfortunately, that situation 27 | sometimes results in the court not being able to issue orders in submitted civil matters within an 28 acceptable period of time. This situation is frustrating to the court, which fully realizes how incredibly frustrating it is to the parties and their counsel.