Hafer v. Farmers Insurance Agency ( 2022 )

1 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 FOR THE EASTERN DISTRICT OF CALIFORNIA 11 12 DeCHERI HAFER, Case No. 1:22-cv-00808-SKO 13 Plaintiff, FIRST SCREENING ORDER 14 v. ORDER FOR PLAINTIFF TO: 15 FARMERS INSURANCE AGENCY, (1) FILE A FIRST AMENDED COMPLAINT; 16 Defendant. (2) NOTIFY THE COURT THAT SHE WISHES TO STAND ON HER 17 COMPLAINT; OR 18 (3) FILE A NOTICE OF VOLUNTARY DISMISSAL 19 (Doc. 1) 20 THIRTY-DAY DEADLINE 21 22 23 Plaintiff DeCheri Hafer is proceeding pro se and in forma pauperis in this action. Plaintiff 24 filed her complaint in the United States District Court for the Central District of California June 21, 25 2022. (Doc. 1). The case was transferred, sua sponte, to this Court on June 30, 2022. (See Doc. 26 8.) Upon review, the Court concludes that the complaint fails to state any cognizable claims. 27 Plaintiff has the following options as to how to proceed. Plaintiff may file an amended 28 complaint, which the Court will screen in due course. Alternatively, Plaintiff may file a statement 1 with the Court stating that she wants to stand on this complaint and have it reviewed by the 2 presiding district judge, in which case the Court will issue findings and recommendations to the 3 district judge consistent with this order. Lastly, Plaintiff may file a notice of voluntary dismissal. 4 If Plaintiff does not file anything, the Court will recommend that the case be dismissed. 5 I. SCREENING REQUIREMENT 6 In cases where the plaintiff is proceeding in forma pauperis, the Court is required to screen 7 each case and shall dismiss the case at any time if the Court determines that the allegation of poverty 8 is untrue, or that the action or appeal is frivolous or malicious, fails to state a claim upon which 9 relief may be granted, or seeks monetary relief against a defendant who is immune from such relief. 10 28 U.S.C. § 1915(e)(2). See also Calhoun v. Stahl, 254 F.3d 845 (9th Cir. 2001) (dismissal required 11 of in forma pauperis proceedings which seek monetary relief from immune defendants); Cato v. 12 United States, 70 F.3d 1103, 1106 (9th Cir. 1995) (district court has discretion to dismiss in forma 13 pauperis complaint under 28 U.S.C. § 1915(e)); Barren v. Harrington, 152 F.3d 1193 (9th Cir. 14 1998) (affirming sua sponte dismissal for failure to state a claim). If the Court determines that a 15 complaint fails to state a claim, leave to amend may be granted to the extent that the deficiencies 16 of the complaint can be cured by amendment. Lopez v. Smith, 203 F.3d 1122, 1130 (9th Cir. 2000) 17 (en banc). 18 In determining whether a complaint fails to state a claim, the Court uses the same pleading 19 standard used under Federal Rule of Civil Procedure 8(a). A complaint must contain “a short and 20 plain statement of the claim showing that the pleader is entitled to relief. . . .” Fed. R. Civ. P. 21 8(a)(2). Detailed factual allegations are not required, but “[t]hreadbare recitals of the elements of 22 a cause of action, supported by mere conclusory statements, do not suffice.” Ashcroft v. Iqbal, 556 23 U.S. 662, 678 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). . A 24 complaint may be dismissed as a matter of law for failure to state a claim for two reasons: (1) lack 25 of a cognizable legal theory; or (2) insufficient facts under a cognizable legal theory. See Balistreri 26 v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1990). Plaintiff must allege a minimum factual 27 and legal basis for each claim that is sufficient to give each defendant fair notice of what the 28 plaintiff’s claims are and the grounds upon which they rest. See, e.g., Brazil v. U.S. Dep’t of the 1 Navy, 66 F.3d 193, 199 (9th Cir. 1995); McKeever v. Block, 932 F.2d 795, 798 (9th Cir. 1991). 2 In reviewing the pro se complaint, the Court is to liberally construe the pleadings and accept 3 as true all factual allegations contained in the complaint. Erickson v. Pardus, 551 U.S. 89, 94 4 (2007). Although a court must accept as true all factual allegations contained in a complaint, a 5 court need not accept a plaintiff’s legal conclusions as true. Iqbal, 556 U.S. at 678. “[A] complaint 6 [that] pleads facts that are ‘merely consistent with’ a defendant’s liability . . . ‘stops short of the 7 line between possibility and plausibility of entitlement to relief.’” Id. (quoting Twombly, 550 U.S. 8 at 557). 9 II. SUMMARY OF PLAINTIFF’S COMPLAINT 10 Plaintiff prepared her complaint on a form titled “Complaint for a Civil Case Alleging 11 Breach of Contract (28 U.S.C. § 1332; Diversity of Citizenship).” (Doc. 1.) She provides an 12 address in Bakersfield, California, and names as the sole defendant Farmers Insurance Agency 13 (“Defendant”), allegedly incorporated in the State of New York, with a principal place of business 14 in New York, New York. (Id. at 1, 3.) 15 Plaintiff alleges Defendant insured the driver of a car that crashed into Plaintiff’s car in 16 2016, resulting in civil case filed in the Kern County Superior Court. (Doc. 1 at 6.) Plaintiff alleges 17 that certain attorneys from “Ford, Walker, Behar, and Haggerty” committed “acts of fraud and 18 perjury” on behalf of Defendant that “prevented Plaintiff from winning” the Kern County state 19 court case. (Id. at 7–8.) As a result, Plaintiff seeks $2 billion. (Id. at 8.) 20 III. DISCUSSION 21 For the reasons discussed below, the Court finds that the complaint does not state any 22 cognizable claims. Plaintiff shall be provided with the legal standards that appear to apply to her 23 claims and will be granted an opportunity to file an amended complaint to correct the identified 24 deficiencies. 25 A. Diversity Jurisdiction 26 Plaintiff alleges that this Court has subject matter jurisdiction based on diversity of 27 citizenship. (Doc. 1 at 3.) Pursuant to 28 U.S.C. § 1332(a), federal district courts have original 28 jurisdiction over civil actions in diversity cases “where the matter in controversy exceeds the sum 1 or value of $75,000” and where the matter is between “citizens of different States.” In other words, 2 the plaintiff and the defendants must be citizens of different states to satisfy the complete diversity 3 requirement of section 1332. Strawbridge v. Curtiss, 7 U.S. 267 (1806) (no plaintiff can be a citizen 4 of the same state as any of the defendants); Cook v. AVI Casino Enterprises, Inc., 548 F.3d 718, 5 722 (9th Cir. 2008) (citing Caterpillar, Inc. v. Lewis, 519 U.S. 61, 68 (1996) (stating that diversity 6 jurisdiction requires “complete diversity of citizenship”)). 7 Here, Plaintiff alleges that she is a citizen of California, and that Defendant is a citizen of 8 New York, establishing diversity of the parties. Plaintiff also alleges that the amount in controversy 9 for this action is $2 billion dollars. This amount, however, appears to be wholly unsubstantiated. 10 Plaintiff’s claims appear to be based on Defendant’s improper conduct stemming from Plaintiff’s 11 car accident with Defendant’s insured, yet Plaintiff does not allege any specific damages (e.g., costs 12 of auto repair, medical expenses, etc.). Thus, it is not clear to the Court how Plaintiff arrived at the 13 alleged amount in controversy. Moreover, the complaint lacks any information as to the insurance 14 policy limits of Defendant’s insured, which likely is a relevant factor in determining the total 15 damages or amount in controversy. 16 “The amount in controversy alleged by the proponent of federal jurisdiction—typically the 17 plaintiff in the substantive dispute—controls so long as the claim is made in good faith.” 18 Geographic Expeditions, Inc. v. Estate of Lhotka ex rel. Lhotka, 599 F.3d 1102, 1106 (9th Cir. 19 2010). Here, it is not clear that Plaintiff’s $2 billion dollar claim was made in good faith. Should 20 Plaintiff elect to file an amended complaint, she must substantiate her alleged $2 billion amount in 21 controversy by submitting declarations and other evidence specifying the nature and amount of 22 Plaintiff’s damages and by providing declaration evidence regarding the subject insurance policy’s 23 limits. 24 B. Rule 8 25 Rule 8 of the Federal Rules of Civil Procedure states that a complaint must contain “a short 26 and plain statement of the claim showing that the pleader is entitled to relief. . . .” Fed. R. Civ. P. 27 8(a)(2). Here, Plaintiff’s complaint violates Rule 8 because it does not contain a short and plain 28 statement of the claim demonstrating that she is entitled to relief. 1 Although the Federal Rules use a flexible pleading policy, Plaintiff is required to give fair 2 notice to the defendants of the basis of the claim and must allege facts that support the elements of 3 the claim plainly and succinctly. A complaint must contain sufficient factual allegations to give 4 the defendant fair notice of the claim and the grounds upon which it rests. Twombly, 550 U.S. at 5 555. 6 Here, there are no factual allegations in the complaint that identify the basis of the claim. 7 The complaint alleges in a vague and conclusory manner that Defendant engaged in “acts of fraud 8 and perjury,” is “committing willful intentional malicious fraud,” and “prevented Plaintiff from 9 winning” her Kern County state court case. (Doc. 1 at 8.) It is not clear, however, what conduct 10 by Defendant establishes her claim. 11 Plaintiff must set forth factual allegations against Defendant sufficient to state a claim. If 12 Plaintiff elects to amend her complaint, she must separate each claim, state the legal basis for the 13 claim, and identify how the facts alleged support and show that the defendant committed the 14 violation asserted as the legal basis for the claim. See Fed. R. Civ. P. 8(a). The failure to do so 15 shall result in dismissal of this action. 16 C. Legal Standards 17 In the event Plaintiff amends her complaint, the Court provides the following legal standards 18 that may be relevant to her action: 19 1. Breach of Contract 20 Plaintiff’s complaint is titled “Complaint for a Civil Case Alleging Breach of Contract,” but 21 no contract is alleged. In California, a cause of action for breach of contract has four elements: (1) 22 allegations that a contract exists between the parties; (2) that plaintiff has performed all the 23 contractual duties or was excused from nonperformance, (3) that defendant has breached the 24 contractual duties, and (4) that plaintiff’s damages were a result of the breach. Reichert v. Gen. 25 Ins. Co., 68 Cal.2d 822, 830 (1968). 26 2. Fraud 27 Under California law, the “indispensable elements of a fraud claim include a false 28 representation, knowledge of its falsity, intent to defraud, justifiable reliance, and damages.” Vess 1 v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1105 (9th Cir. 2003). 2 Rule 9(b) of the Federal Rules of Civil Procedure requires that, when fraud is alleged, “a 3 party must state with particularity the circumstances constituting fraud . . . .” Fed. R. Civ. P. 9(b). 4 “Rule 9(b) demands that the circumstances constituting the alleged fraud be ‘specific enough to give defendants notice of the particular misconduct . . . so that [they] can defend against the charge 5 and not just deny that she has done anything wrong.’” Bly–Magee v. California, 236 F.3d 1014, 6 1019 (9th Cir. 2001) (quoting Neubronner v. Milken, 6 F.3d 666, 671 (9th Cir. 1993)). “Averments 7 of fraud must be accompanied by ‘the who, what, when, where, and how’ of the misconduct 8 charged.” Vess, 317 F.3d at 1106 (quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997)). 9 see also United States ex rel. Cafasso, v. Gen. Dynamics C4 Sys., Inc., 637 F.3d 1047, 1055 (9th 10 Cir. 2011) (“[A] pleading must identify ‘the who, what, when, where, and how of the misconduct 11 charged,’ as well as ‘what is false or misleading about [the purportedly fraudulent] statement, and 12 why it is false.’ “) (alterations in original). A party alleging fraud must “set forth more than the 13 neutral facts necessary to identify the transaction.” Vess, 317 F.3d at 1106 (quoting Decker v. 14 GlenFed, Inc. (In re GlenFed, Inc. Sec. Litig.), 42 F.3d 1541, 1548 (9th Cir. 1994), superseded by 15 statute on other grounds). 16 Here, Plaintiff alleges that Defendant engaged in “fraud,” but does not set forth any specific 17 facts about any misrepresentation made by Defendant. She also does not plead that Defendant 18 knew any misrepresentation was false at the time it was allegedly made and intended to deceive 19 Plaintiff. Thus, Plaintiff has failed to allege a cognizable fraud claim in accordance with Rule 9(b) 20 and California law. See In re GlenFed, Inc. Sec. Litig., 42 F.3d at 1547 n.7 (Pursuant to Rule 9(b), 21 a plaintiff alleging fraud at a minimum must plead evidentiary facts such as the time, place, persons, 22 statements and explanations of why allegedly misleading statements are misleading.); Vess, 317 23 F.3d at 1105. 3. Rooker-Feldman 24 25 The Court notes that the Rooker-Feldman doctrine prohibits federal courts from exercising 26 subject matter jurisdiction over suits “[b]rought by state-court losers complaining of injuries caused 27 by state-court judgments rendered before the district court proceedings commenced and inviting 28 1 district court review and rejection of those judgments.” Lance v. Dennis, 546 U.S. 459, 464 (2006) 2 (quoting Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005)). The doctrine 3 also applies to a claim that is a de facto appeal from a state court judgment. Noel v. Hall, 341 F.3d 4 1148, 1155 (9th Cir. 2003). A federal action constitutes a de facto appeal where claims raised in 5 the federal court are “inextricably intertwined” with a state court judgment. Reusser v. Wachovia 6 Bank, N.A., 525 F.3d 855, 859 (9th Cir. 2008). An issue is inextricably intertwined with a state 7 court judgment if the federal claim can succeed only to the extent that the state court wrongly 8 decided the issues before it, or if the relief requested would effectively reverse or void the state 9 court decision. Fontana Empire Cir., LLC v. City of Fontana, 307 F.3d 987, 992 (9th Cir. 2002) 10 (quoting Pennzoil Co. v. Texaco, Inc., 481 U.S. 1, 25 (1987) and Charchenko v. City of Stillwater, 11 47 F.3d 981, 983 (8th Cir. 1995)). 12 An exception to the Rooker-Feldman doctrine exists when a state court judgment is based 13 on extrinsic fraud. Kougasian v. TMSL, Inc., 359 F.3d 1136, 1141 (9th Cir. 2004) (“It has long 14 been the law that a plaintiff in federal court can seek to set aside a state court judgment obtained 15 through extrinsic fraud.”). Extrinsic fraud is “conduct which prevents a party from presenting his 16 claim in court.” Id. at 1140. This exception, however, does not apply when a plaintiff alleges 17 intrinsic fraud. Dixon v. State Bar of Cal., 32 F. App’x 355, 356–57 (9th Cir. 2002). Intrinsic fraud 18 is fraud that “goes to the very heart of the issues contested in the state court action.” Id. at 357 19 (quoting Green v. Ancora-Citronelle, 577 F.2d 1380, 1384 (9th Cir. 1978)). For example, the Ninth 20 Circuit has found that “allegations of discriminatory prosecution, the use of fabricated evidence, 21 and the wrongful exclusion of supposedly exculpatory evidence” described intrinsic, not extrinsic, 22 fraud. Dixon, 32 F. App’x at 357; see also Wood v. McEwen, 644 F.2d 797, 801 (9th Cir. 1981) 23 (holding that allegations of perjury, are, at best, intrinsic fraud). 24 Here, Plaintiff has provided only limited information regarding the Kern County state court 25 complaint and any resulting judgment, and it is unclear whether Plaintiff is seeking to challenge 26 that judgment or whether she is alleging a claim of extrinsic (as opposed to intrinsic) fraud. Further, 27 although, as detailed above, Plaintiff fails to state a claim for fraud, the Court will allow Plaintiff 28 leave to amend to make clear her allegations. Therefore, the Court cannot determine at this time to 1 what extent, if at all, the Rooker-Feldman doctrine applies to Plaintiff’s claims. 2 D. Leave to Amend 3 The Court has screened Plaintiff’s complaint and finds that it fails to state any cognizable 4 claims. Under Rule 15(a)(2) of the Federal Rules of Civil Procedure, “the court should freely give 5 leave [to amend] when justice so requires.” Accordingly, the Court will provide Plaintiff with time 6 to file an amended complaint, so Plaintiff can provide additional factual allegations. Lopez v. Smith, 7 203 F.3d 1122, 1126-30 (9th Cir. 2000). 8 Plaintiff is granted leave to file an amended complaint within thirty days. If Plaintiff files 9 an amended complaint, she should plead additional facts that address Rule 9(b)’s heightened 10 pleading standard insofar as any fraud-based claims are concerned. Plaintiff is cautioned that an 11 amended complaint supersedes all prior complaints filed in an action, Lacey v. Maricopa Cty., 693 12 F.3d 896, 907 n.1 (9th Cir. 2012), and must be “complete in itself without reference to the prior or 13 superseded pleading,” Local Rule 220. Therefore, in an amended complaint, as in an original 14 complaint, each claim and the involvement of each Defendant must be sufficiently alleged. The 15 amended complaint should be clearly and boldly titled “First Amended Complaint,” refer to the 16 appropriate case number, and be an original signed under penalty of perjury. Plaintiff should note 17 that although she has been given the opportunity to amend, it is not for the purpose of changing the 18 nature of this suit or adding unrelated claims. George v. Smith, 507 F.3d 605, 607 (7th Cir. 2007) 19 (no “buckshot” complaints). 20 Plaintiff has a choice on how to proceed. Plaintiff may file an amended complaint if she 21 can substantiate the amount in controversy for purposes of subject matter jurisdiction and she 22 believes that additional true factual allegations would state cognizable claims. If Plaintiff files an 23 amended complaint, the Court will screen that complaint in due course. Alternatively, Plaintiff 24 may choose to stand on her complaint subject to the Court issuing findings and recommendations 25 to a district judge consistent with this order. Lastly, Plaintiff may file a notice of voluntary 26 dismissal. 27 28 1 IV. ORDER 2 Based on the foregoing, IT IS ORDERED that: 3 1. Within thirty (30) days from the date of service of this order, Plaintiff shall either: 4 a. File a First Amended Complaint; 5 b. Notify the Court in writing that she wants to stand on this complaint; or 6 c. File a notice of voluntary dismissal. 7 2. If Plaintiff chooses to file an amended complaint, Plaintiff shall caption the amended 8 complaint “First Amended Complaint” and refer to case number 1:22-cv-00808- 9 SKO; and 10 3. Failure to comply with this order may result in the dismissal of this action. 11 IT IS SO ORDERED. 12 13 Dated: August 10, 2022 /s/ Sheila K. Oberto . UNITED STATES MAGISTRATE JUDGE 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28