Wolfing v. Medical Mgt. Int'l, Inc. ( 2024 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 AMBER WOLFING, No. 2:24-cv-01963-DC-JDP 12 Plaintiff, 13 v. ORDER GRANTING PLAINTIFF’S MOTION TO REMAND AND REMANDING THIS 14 MEDICAL MANAGEMENT ACTION TO THE SACRAMENTO COUNTY INTERNATIONAL, INC., SUPERIOR COURT 15 Defendant. (Doc. No. 11) 16 17 This matter is before the court on Plaintiff Amber Wolfing’s motion to remand this action 18 to the Sacramento County Superior Court. (Doc. No. 11.) Pursuant to Local Rule 230(g), the 19 pending motion was taken under submission to be decided on the papers. (Doc. No. 13.) For the 20 reasons explained below, Plaintiff’s motion to remand will be granted. 21 BACKGROUND 22 On April 18, 2024, Plaintiff filed a wage-and-hour class action complaint against her 23 employer Defendant Medical Management International, Inc. and Does 1 through 10, in the 24 Sacramento County Superior Court. (Doc. No. 1 at 16.) Plaintiff alleges that since August 2019, 25 she worked for Defendant in California as an hourly-paid, non-exempt employee. (Id. at 17, ¶ 3.) 26 Plaintiff brings nine claims under California state law for: (1) unfair competition in violation of 27 the Unfair Competition Law (“UCL”), California Business and Professional Code §§ 17200, et 28 seq; (2) failure to pay minimum wages; (3) failure to pay overtime wages; (4) failure to provide 1 required meal periods; (5) failure to provide required rest periods; (6) failure to provide accurate 2 itemized statements; (7) failure to reimburse employees for required expenses; (8) failure to pay 3 sick wages; and (9) failure to provide reasonable accommodation in violation of the California 4 Fair Employment and Housing Act (“FEHA”), California Government Code § 12940(m). (Id. at 5 40–58.) Plaintiff brings her UCL claim on behalf of herself and a “California Class,” and she 6 brings her labor claims on behalf of herself and a “California Labor Sub Class.” (Id.) Plaintiff’s 7 FEHA claim is brought only on behalf of herself individually, and for that claim she seeks: (1) 8 compensatory damages in excess of $25,000; (2) special and general damages; (3) punitive 9 damages; (4) statutory damages, penalties, and attorneys’ fees; (5) past and future loss of 10 earnings; and (6) “interest at the legal rate in an amount according to proof.”1 (Id. at 61.) 11 On July 17, 2024, Defendant filed a notice of removal asserting this court has subject 12 matter jurisdiction based on diversity pursuant to 20 U.S.C. §§ 1332, 1441, and 1446. (Id. at 2.) 13 On August 23, 2024, Plaintiff filed the pending motion to remand this action back to the 14 Sacramento County Superior Court, on the grounds that Defendant failed to establish, by a 15 preponderance of the evidence, that the amount in controversy exceeds $75,000, as required.2 16 (Doc. No. 11 at 5.) Defendant filed its opposition to the pending motion and a request for judicial 17 notice on September 13, 2024. (Doc. Nos. 14, 15.) Plaintiff filed her reply thereto on September 18 23, 2024. (Doc. No. 16.) 19 LEGAL STANDARD 20 “Federal courts are courts of limited jurisdiction.” Gunn v. Minton, 568 U.S. 251, 256 21 (2013) (citing Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)). A 22 defendant may remove any action from state court to federal court when the federal court has 23 24 1 Plaintiff also seeks relief, including damages, for her UCL and labor claims. (Doc. No. 1 at 59– 61.) The court does not summarize that relief sought, however, because only the damages sought 25 by Plaintiff on her FEHA claim are at issue in the pending motion. 26 2 Defendant asserts, and Plaintiff does not dispute, that Defendant is a citizen of Delaware and 27 Washington, and that Plaintiff is a citizen of California. (Doc. No. 1 at 2.) Thus, the only question before the court is whether the amount in controversy exceeds the $75,000 jurisdictional 28 threshold. 1 original jurisdiction over the matter. 28 U.S.C. § 1441(a). Removal to federal court is proper 2 when a case filed in state court poses a federal question or where there is diversity of citizenship 3 among the parties and the amount in controversy exceeds $75,000. 28 U.S.C. §§ 1331, 1332(a). 4 A party’s notice of removal must contain “a short and plain statement of the grounds for 5 removal.” 28 U.S.C. § 1446(a). “By design, § 1446(a) tracks the general pleading requirement 6 stated in Rule 8(a) of the Federal Rules of Civil Procedure,” and a “statement ‘short and plain’ 7 need not contain evidentiary submissions.” Dart Cherokee Basin Operating Co., LLC v. Owens, 8 574 U.S. 81, 84, 87 (2014); see also Ramirez-Duenas v. VF Outdoor, LLC, No. 1:17-cv-0161- 9 AWI-SAB, 2017 WL 1437595, at *2 (E.D. Cal. Apr. 41, 2017) (“The notice of removal may rely 10 on the allegations of the complaint and need not be accompanied by any extrinsic evidence.”). 11 However, if a plaintiff contests the allegations in the notice of removal, both sides may 12 “submit proof and the court decides, by a preponderance of the evidence, whether the amount in 13 controversy requirement has been satisfied.” Dart Cherokee, 574 U.S. at 82; see also Johnson v. 14 Wal-Mart Assocs. Inc., No. 22-cv-7425-MWF-MRW, 2023 WL 2713988, at *4 (C.D. Cal. Mar. 15 30, 2023) (finding the standards set forth in Dart and subsequent cases in this circuit are not 16 limited to Class Action Fairness Act removals). 17 A plaintiff may challenge the allegations in the notice of removal in two ways. First, a 18 plaintiff may bring a “facial attack” which “accepts the truth of the . . . allegations but asserts that 19 they ‘are insufficient on their face to invoke federal jurisdiction.’” Salter v. Quality Carriers, Inc., 20 974 F.3d 959, 964 (9th Cir. 2014) (quoting Leite v. Crane Co., 749 F.3d 1117, 1121 (9th Cir. 21 2014)). When a plaintiff mounts a facial attack, the court resolves it in much the same way as a 22 motion to dismiss—by accepting the allegations as true, drawing all reasonable inferences in the 23 defendant’s favor, and determining whether the allegations are sufficient to invoke the court’s 24 jurisdiction. Id. Alternatively, a plaintiff may bring a “factual attack,” which “contests the truth of 25 the . . . factual allegations, usually by introducing evidence outside the pleadings.” Id. When a 26 plaintiff brings a factual attack, the defendant must support its allegations with “competent proof” 27 under a summary judgment-like standard. Id. Defendants’ “burden of establishing removal” does 28 not shift to Plaintiff at any time. Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 685 (9th 1 Cir. 2006). “This approach is akin to the procedure in the summary judgment context whereby, if 2 the party with the initial burden of production fails to carry its burden, the other party ‘has no 3 obligation to produce anything.’” Giles v. Nat’l Express Transit Corp., No. 22-cv-00257-JLT- 4 BAM, 2023 WL 2681974, at *1 (E.D. Cal. Mar. 29, 2023) (quoting Nissan Fire & Marine Ins. 5 Co., Ltd. v. Fritz Cos., Inc., 210 F.3d 1099, 1102–03 (9th Cir. 2000)). 6 The party removing the action has the ultimate burden of establishing grounds for federal 7 jurisdiction by a preponderance of the evidence. Hamsen v. Grp. Health Coop., 902 F.3d 1051. 8 1057 (9th Cir. 2018). “If at any time before final judgment it appears that the district court lacks 9 subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). Removal statutes 10 are strictly construed against jurisdiction. Grancare, LLC v. Thrower by & through Mills, 889 11 F.3d 543, 550 (9th Cir. 2018). A federal court must remand the case to state court if there is any 12 doubt as to right of removal. Id.; Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 13 (9th Cir. 2003). 14 ANALYSIS 15 As noted above, the only issue before the court is whether the amount in controversy 16 threshold has been met. In her motion, Plaintiff seeks remand of this action to the Sacramento 17 County Superior Court on the grounds that Defendant has failed to satisfy its burden of 18 establishing that the amount in controversy for Plaintiff’s individual claims exceeds the $75,000 19 threshold for diversity jurisdiction. (Doc. Nos. 11 at 10; 1 at ¶ 25.) For the reasons explained 20 below, the court concludes that Defendant has not met its burden of establishing, by a 21 preponderance of the evidence, that the amount in controversy exceeds the jurisdictional 22 minimum. 23 As an initial matter, the amount in controversy is not apparent from the face of the 24 complaint, despite Plaintiff’s argument in her reply to the contrary. (Doc. No. 16 at 4.) In the 25 complaint, Plaintiff alleges “[t]he amount in controversy for Plaintiff individually does not exceed 26 the sum or value of $75,000.” (Doc. No. 1 at 25, ¶ 25.) However, Plaintiff makes no mention of 27 the total amount in controversy in her prayer for relief or elsewhere in her complaint. (Id. at 59– 28 61). Plaintiff instead only mentions the amount in controversy for compensatory damages, as 1 “according to proof at trial, but in excess of $25,000,” and for actual damages, alleging that they 2 do not exceed an “aggregate penalty of $4,000” for the wage-and-hour claims. (Id. at 60–61, ¶ 2– 3 3.) Therefore, despite providing some indication of parameters, Plaintiff’s complaint is 4 ambiguous as to the amount in controversy. See Guglielmino v. McKee Foods Corp., 506 F.3d 5 696, 700 (9th Cir. 2007) (finding plaintiff’s complaint to be ambiguous as to amount in 6 controversy where plaintiff limited some damages to $75,000 but made no mention of the “total 7 dollar amount in controversy” in prayer for relief and did not include any limit as to attorneys’ 8 fees). Where, as here, a complaint is unclear as to the amount in controversy, the removing 9 defendant must establish by a preponderance of the evidence that the $75,000 threshold is met. Id. 10 at 699. 11 In its notice of removal, Defendant makes a calculation that differs somewhat from the 12 calculation made in its opposition to the motion to remand. (Doc. Nos. 1 at 13; 14 at 5.) 13 Defendant in its notice of removal calculates the amount in controversy to be $98,200.00. (Doc. 14 No. 1 at 13.) In this calculation, Defendant includes damages from Plaintiff’s minimum wage 15 claim ($2,800.00), meal and rest break claims ($9,800.00), overtime wage claim ($7,350.00), 16 wage statement claims ($3,250.00), wage statement claim ($9,800.00), emotional distress 17 damages ($25,000.00), punitive damages ($25,000.00), and attorneys’ fees for all of Plaintiff’s 18 claims ($25,000). (Id.) Plaintiff argues in her motion to remand that Defendant’s calculations with 19 respect to each of these claims are both factually and facially deficient. Plaintiff avers that 20 Defendant uses rates of pay inconsistent with Defendant’s declaration stating Plaintiff’s rates of 21 pay for the period in question, offers no proof and relies on “unsupported and unreasonable 22 assumptions” to substantiate 20% and 100% violation rates, and fails to present any evidence 23 regarding which shifts Plaintiff worked that entitled her to meal and rest breaks. (Doc. No. 11 at 24 10–15.) In opposition, Defendant does not address—let alone rebut with evidence—Plaintiff’s 25 arguments as to her labor claims. Defendant has apparently abandoned its inclusion of those 26 damages in attempting to show by a preponderance of the evidence that the amount in 27 controversy exceeds $75,000. Instead, Defendant argues that the “amount in controversy for 28 Plaintiff’s individual FEHA claim meets or exceeds the jurisdictional threshold . . . standing 1 alone.” (Doc. No. 14 at 2.) To that end, Defendant calculates compensatory damages 2 ($25,000.01), emotional distress damages ($10,000.00), punitive damages ($25,000.01), and 3 attorneys’ fees ($30,000.00) for a total amount in controversy on the FEHA claim of $98,000.02. 4 (Id. at 5.) The court will begin by addressing Defendant’s calculation of attorneys’ fees because 5 they are critical to reaching the $75,000 threshold for diversity jurisdiction. 6 Attorney’s fees may be “considered in determining the amount in controversy if such fees 7 are recoverable by plaintiff, either by statute or by contract.” Campbell v. Hartford Life Ins. Co., 8 825 F. Supp. 2d 1005, 1009 (E.D. Cal. 2011) (citing Galt G/S v. JSS Scandinavia, 142 F.3d 1150, 9 1156 (9th Cir.1998)). If future attorneys’ fees are recoverable by statute, they “should be included 10 in the amount in controversy” calculation. Fritsch v. Swift Transp. Co. of Ariz., LLC, 899 F.3d 11 785, 788 (9th Cir. 2018). However, a “district court may reject the defendant’s attempts to include 12 future attorneys’ fees in the amount in controversy” if a defendant fails to carry their burden of 13 proving future attorneys’ fees by a preponderance of the evidence. Id. at 795. 14 Here, there is no dispute that attorneys’ fees are recoverable under FEHA and should be 15 included in the amount in controversy calculation. Defendant estimates Plaintiff’s counsel will 16 spend at least 100 hours litigating the FEHA claim since it is “completely separate and apart from 17 the wage-and-hour claims.” (Doc. No. 14 at 3.) To support its estimate of 100 hours, Defendant 18 relies on the decision in Adkins v. J.B. Hunt Transport, Inc. 293 F. Supp. 3d 1140, 1148 (E.D. 19 Cal. Mar. 20, 2018), in which the court found 100 hours to be an “appropriate and conservative 20 estimate” of the number of hours expended through trial for employment cases generally. (Id. at 21 3.) To arrive at its estimate amount of attorneys’ fees, Defendant multiplies the 100 hours by an 22 hourly rate of $300, which Defendant represents is a discount from the “lowest attorney rate 23 ($450)” that Plaintiff’s counsel’s law firm bills for associates’ time. (Doc. No. 14 at 3.) 24 Specifically, Defendant cites as evidence a declaration by Plaintiff’s counsel that was filed on 25 behalf of another client in a different action, in which Plaintiff’s counsel stated that his law firm 26 ///// 27 ///// 28 ///// 1 bills associates at $450 to $750 per hour and partners at $850 to $995 per hour.3 (Id.) Thus, 2 Defendant calculates attorneys’ fees in the amount of $30,000 (100 hours × $300 per hour)—an 3 estimate Defendant characterizes as “conservative.” (Id.) 4 In her reply, Plaintiff argues that Defendant’s analysis of Plaintiff’s attorneys’ fees is 5 unreliable and that Defendant’s estimation of 100 hours of work is without any evidentiary 6 support. (Doc. No. 16 at 6.) Plaintiff further argues that Defendant’s reliance on the court’s 7 decision in Adkins is unwarranted because that court found 100 hours to be a reasonable 8 estimation of time expended for litigation through trial of an employment action that included 9 many claims, not just an individual FEHA claim. (Id.) (citing Adkins, 293 F. Supp. 3d at 1148). 10 The court agrees with Plaintiff’s arguments and finds that Defendant’s attorneys’ fees 11 calculation is speculative. Defendant has not demonstrated why its assumption that Plaintiff’s 12 counsel will spend at least 100 hours on the FEHA claim alone is reasonable. Notably, 13 Defendant’s reliance on Adkins is misplaced because the 100-hour estimate in that case included 14 time spent on several claims, not just FEHA. Defendant has failed to analogize this case to one in 15 which 100 hours was found to be a reasonable estimate for time-spent litigating an individual 16 FEHA claim. See Schneider v. Ford Motor Co., 441 F. Supp. 3d 909, 914 (N.D. Cal. 2020) 17 (finding that the defendant’s citation to another case in which the same counsel’s fees were at 18 issue was unconvincing because the defendant failed to provide further comparison to that other 19 case); 293 F. Supp. 3d at 1148. Further, Defendant presents no “summary-judgement-type” 20 evidence to explain why 100 hours is an appropriate estimate for Plaintiff’s FEHA claim. See 21 Elias v. Integon Preferred Ins. Co., No. 2:24-cv-01981-WLH-RAO, 2024 WL 2732228, at *2 22 23 3 Defendant requests that the court take judicial notice of the declaration by Plaintiff’s counsel in a different case that was filed to support the hourly rate that the plaintiff had used to calculate 24 attorneys’ fees in connection with their motion for court approval of the parties’ settlement. (Doc. No. 15 at 2.) Pursuant to Federal Rules of Evidence 201(b), a court may take judicial notice of a 25 fact if it is “not subject to reasonable dispute.” Fed. R. Evid. 201(b). If a fact is “generally known” or “can be accurately and readily determined from sources whose accuracy cannot 26 reasonably be questioned,” it is “not subject to reasonable dispute.” Fed. R. Evid. 201(b)(1)–(2). 27 Courts regularly take judicial notice of court filings and other matters of public record. See Reyn’s Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006). Therefore, 28 Defendant’s request for judicial notice will be granted. 1 | (C.D. Cal. May 28, 2024) (finding that the defendant’s estimate of the number of hours to be 2 | spent on the case was not supported by a preponderance of the evidence because the defendant 3 | failed to explain the “specific factors present in the case” that led to that estimate). Further, 4 | Defendant’s “lump sum” estimate does not outline how much time counsel will expend on “major 5 | tasks,” or assign a billing rate to these tasks. See Newsome v. FCA USA LLC, No. 1:20-cv-01189- 6 | JLT-BAK, 2022 WL 408631, at *6 (E.D. Cal. Feb. 10, 2022) (finding attorneys’ fees to be 7 | speculative where defendant failed to estimate the “amount of time major tasks will take or 8 | approximate the hourly billing rate”). The court finds that Defendant has failed to proffer 9 | “summary-judgment-type evidence” to show that it is “more likely than not” that the amount in 10 | controversy exceeds $75,000. See Schneider, 441 F. Supp. 3d at 914 (quoting Fritsch, 899 F.3d at 11 | 795-96). 12 For these reasons, Defendant has not met its burden to show by a preponderance of the 13 | evidence that the amount in controversy requirement is satisfied. Even if the court adopted the 14 | remainder of Defendant’s calculations as stated in its opposition, the total amount in controversy 15 | would still fall short of $75,000. (Doc. No. 14 at 5.) Therefore, because this court does not have 16 || subject matter jurisdiction over this action, the court will grant Plaintiff's motion to remand this 17 || case. 18 CONCLUSION 19 For the reasons explained above: 20 1. Plaintiff's motion to remand this action to the Sacramento County Superior Court 21 (Doc. No. 11) is granted; 22 2. Plaintiffs request for judicial notice (Doc. No. 15) is granted; 23 3. This action is remanded to the Sacramento County Superior Court, pursuant to 28 24 U.S.C. § 1447(c), for lack of subject matter jurisdiction; and 25 4. The Clerk of the Court is directed to close this case. 26 7 IT IS SO ORDERED. □ 2g | Dated: _November 26, 2024 DUC 8 Dena Coggins United States District Judge 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28