“We hold that where an underlying statute authorizes an award of attorneys’ fees, either with mandatory or discretionary language, such fees may be included in the amount in controversy.”
How later courts described this case
- “We hold that where an underlying statute authorizes an award of attorneys’ fees, either with mandatory or discretionary language, such fees may be included in the amount in controversy.”
Written by the judges who cited it.
The opinion
Case 8:22-cv-02117-DOC-JDE Document 17 Filed 01/31/23 Page 1 of 5 Page ID #:151
JS-6
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. 8:22-cv-02117-DOC-JDE Date: January 31, 2023
Title: VANESSA M. CERVANTES ET AL V. FCA US LLC ET AL.
PRESENT:
THE HONORABLE DAVID O. CARTER, JUDGE
Karlen Dubon Not Present
Courtroom Clerk Court Reporter
ATTORNEYS PRESENT FOR ATTORNEYS PRESENT FOR
PLAINTIFF: DEFENDANT:
None Present None Present
PROCEEDINGS (IN CHAMBERS): ORDER REMANDING CASE TO
STATE COURT SUA SPONTE
On January 30, 2023, the Court held a Scheduling Conference in this action,
during which the Court and counsel conferred regarding jurisdiction. Upon closer review
of the pleadings, the Court finds that the amount in controversy falls short of the statutory
threshold required under the Magnuson-Moss Warranty Act.
Accordingly, and for reasons set forth more fully below, the Court sua sponte
REMANDS this case to the Superior Court of California, County of Orange.
I. Background
This action concerns Plaintiffs Vanessa M. Cervantes and Blanca Cervantes’s
(collectively, “Plaintiffs”) 2017 warranty contract with Defendant FCA US LLC.
(“FCA”) regarding a 2017 Jeep cherokee vehicle (“Vehicle”). Complaint (“Compl.”)
(Dkt. 1-2) ¶ 10. Plaintiffs allege FCA and FCA’s representatives concealed the defective
nature of the Vehicle, failed to service or repair the Vehicle, and subsequently failed to
replace it. Compl. ¶¶ 21–27. The total sale price for the Vehicle was $24,681.55. Notice
of Removal (“Notice”) (Dkt. 1) ¶ 34.
Case 8:22-cv-02117-DOC-JDE Document 17 Filed 01/31/23 Page 2 of 5 Page ID #:152
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SA CV 22-02117-DOC-JDE Date: January 31, 2023
Page 2
Plaintiffs filed the original action in state court on October 17, 2022. Compl.
Defendants filed a Notice of Removal on November 22, 2022. Notice. The Court held a
scheduling conference on January 30, 2023.
II. Legal Standard
“If at any time before final judgment it appears that the district court lacks subject
matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). Removal of a case
from state court to federal court is governed by 28 U.S.C. § 1441, which provides in
relevant part that “any civil action brought in a State court of which the district courts of
the United States have original jurisdiction, may be removed . . . to the district court of
the United States for the district and division embracing the place where such action is
pending.” 28 U.S.C. § 1441. This statute “is strictly construed against removal
jurisdiction,” and the party seeking removal “bears the burden of establishing federal
jurisdiction.” Ethridge v. Harbor House Rest., 861 F.2d 1389, 1393 (9th Cir. 1988)
(emphasis added) (citations omitted).
Federal diversity jurisdiction requires that the parties be citizens of different states
and that the amount in controversy exceed $75,000. 28 U.S.C. § 1332(a). For diversity
jurisdiction purposes, a corporation is “deemed to be a citizen of every State and foreign
state by which it has been incorporated and of the State or foreign state where it has its
principal place of business.” 28 U.S.C. § 1332(c)(1). The presence of any single plaintiff
from the same state as any single defendant destroys “complete diversity” and strips the
federal courts of original jurisdiction over the matter. Exxon Mobil Corp. v. Allapattah
Servs., Inc., 545 U.S. 546, 553 (2005).
Generally, a removing defendant must prove by a preponderance of the evidence
that the amount in controversy satisfies the jurisdictional threshold. Guglielmino v.
McKee Foods Corp., 506 F.3d 696, 699 (9th Cir. 2008). If the complaint affirmatively
alleges an amount in controversy greater than $75,000, the jurisdictional requirement is
“presumptively satisfied.” Id. A plaintiff who then tries to defeat removal must prove to a
“legal certainty” that a recovery of more than $75,000 is impossible. St. Paul Mercury
Indem. Co. v. Red Cab Co., 303 U.S. 283, 288-89 (1938); Crum v. Circus Enters., 231
F.3d 1129, 1131 (9th Cir. 2000). This framework applies equally to situations where the
complaint leaves the amount in controversy unclear or ambiguous. See Gaus v. Miles,
Inc., 980 F.2d 564, 567 (9th Cir. 1992); Sanchez v. Monumental Life Ins. Co., 102 F.3d
398, 403-04 (9th Cir. 1996).
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SA CV 22-02117-DOC-JDE Date: January 31, 2023
Page 3
A removing defendant “may not meet [its] burden by simply reciting some
‘magical incantation’ to the effect that ‘the matter in controversy exceeds the sum of
[$75,000],’ but instead, must set forth in the removal petition the underlying facts
supporting its assertion that the amount in controversy exceeds [$75,000].” Richmond v.
Allstate Ins. Co., 897 F. Supp. 447, 450 (S.D. Cal. 1995) (quoting Gaus v. Miles, Inc.,
980 F.2d 564, 567 (9th Cir. 1992)). If the plaintiff has not clearly or unambiguously
alleged $75,000 in its complaint or has affirmatively alleged an amount less than $75,000
in its complaint, the burden lies with the defendant to show by a preponderance of the
evidence that the jurisdictional minimum is satisfied. Geographic Expeditions, Inc. v.
Estate of Lhotka ex rel. Lhotka, 599 F.3d 1102, 1106-07 (9th Cir. 2010); Guglielmino,
506 F.3d at 699.
While the defendant must “set forth the underlying facts supporting its assertion
that the amount in controversy exceeds the statutory minimum,” the standard is not so
taxing so as to require the defendant to “research, state, and prove the plaintiff’s claims
for damages.” Coleman v. Estes Express Lines, Inc., 730 F. Supp. 2d 1141, 1148 (C.D.
Cal. 2010) (emphases added). In short, the defendant must show that it is “more likely
than not” that the amount in controversy exceeds the statutory minimum. Id. Summary
judgment-type evidence may be used to substantiate this showing. Matheson v.
Progressive Specialty Ins. Co., 319 F.3d 1089, 1090–91 (9th Cir. 2003); Singer v. State
Farm Mut. Auto. Ins. Co., 116 F.3d 373, 377 (9th Cir. 1997). For example, defendants
may make mathematical calculations using reasonable averages of hourly, monthly, and
annual incomes of comparable employees when assessing the amount in controversy in a
wrongful termination suit. Coleman, 730 F. Supp. 2d. at 1148–49.
Federal district courts have original jurisdiction in actions “arising under the
Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331. An action "arises
under" the federal law within the meaning of 28 U.S.C. § 1331 if: (1) federal law creates
the cause of action, or (2) the Plaintiff right to relief necessarily depends on resolution of
a substantial question of federal law. Franchise Tax Board v. Construction Laborers
Vacation Trust, 463 U.S. l, 27-28 (1983). 15 U.S.C. § 2310(d)(l)(B) of the Magnuson-
Moss Warranty Act states in part that a consumer who is damaged by a warrantor's
failure to comply with a warranty “may bring suit for damages and other legal and
equitable relief in an appropriate district court of the United States, subject to paragraph
(3) of this subsection.” Paragraph (3) goes on to state that “[n]o claim shall be cognizable
in a suit brought under paragraph (l)(B) of this subsection ... if the amount in controversy
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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SA CV 22-02117-DOC-JDE Date: January 31, 2023
Page 4
is less than the sum or value of $50,000.00 (exclusive of interest and costs) computed on
the basis of all claims to be determined in this suit ...” 15 U.S.C. § 2310(d)(3)(B).
If the court lacks subject matter jurisdiction, any action it takes is ultra vires and
void. See Gonzalez v. Crosby, 545 U.S. 524, 534 (2005); Steel Co. v. Citizens for a Better
Env’t, 523 U.S. 83, 94, 101–02 (1998). The lack of subject matter jurisdiction may be
raised at any time by either the parties or the court. Fed. R. Civ. P. 12(h)(3). If subject
matter jurisdiction is found to be lacking, the court must dismiss the action, id., or
remand pursuant to 28 U.S.C. § 1447(c). A Court may raise the question of subject matter
jurisdiction sua sponte. See Snell v. Cleveland, Inc., 316 F.3d 822, 826 (9th Cir. 2002).
III. Discussion
Defendant argues that the Court has original jurisdiction in this case for the claims
arising under 15 U.S.C. §2310, the Magnuson-Moss Warranty Act. Notice ¶ 18. The
Court disagrees.
“No claim shall be cognizable in a suit brought under [the Magnuson-Moss
Warrnty Act]... if the amount in controversy is less than the sum or value of $50,000.00.”
15 U.S.C. § 2310(d)(3)(B). The Court finds that Defendant has not shown by a
preponderance of the evidence that the amount in controversy exceeds $50,000 for
federal question purposes under the Magnuson-Moss Warranty Act. It is undisputed that
the total sale price of the Vehicle is $24,681.55. Notice ¶ 34. Defendant then argues that
the Court should include statutory civil penalties (here, $49,363.10) in its calculation of
the amount in controversy. Notice ¶ 35.
The Court will not include speculative civil penalties or attorneys’ fees to meet the
amount in controversy requirement. See Galt G/S v. JSS Scandinavia, 142 F.3d 1150,
1156 (9th Cir. 1998) (“We hold that where an underlying statute authorizes an award of
attorneys’ fees, either with mandatory or discretionary language, such fees may be
included in the amount in controversy.”) (emphasis added). The Court finds that
Defendant has not shown by a preponderance of the evidence that the amount in
controversy exceeds $50,000.
Accordingly, the Court finds that it lacks jurisdiction over this matter.
Case 8:22-cv-02117-DOC-JDE Document 17 Filed 01/31/23 Page 5 of 5 Page ID #:155
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No. SA CV 22-02117-DOC-JDE Date: January 31, 2023
Page 5
IV. Disposition
For reasons set forth above, the Court hereby REMANDS this case to the Superior
Court of California, County of Orange.
The Clerk shall serve this minute order on the parties.
MINUTES FORM 11 Initials of Deputy Clerk: kdu
CIVIL-GEN