Herrera v. Exxon Corp.: Exxon Co., USA, C-77-0253-CBR.

• Decision Date: 27 April 1977
• Docket Number: No. C-77-0253-CBR.,C-77-0253-CBR.
• Citation: 430 F. Supp. 1215
• Parties: Theodore HERRERA, Plaintiff, v. EXXON CORPORATION: EXXON COMPANY, U. S. A., and Does I through XX, Inclusive, Defendants.
• Court: U.S. District Court — Northern District of California

430 F. Supp. 1215

Theodore HERRERA, Plaintiff, v. EXXON CORPORATION: EXXON COMPANY, U. S. A., and Does I through XX, Inclusive, Defendants.

No. C-77-0253-CBR.

United States District Court, N. D. California.

April 27, 1977.

Dobbs, Doyle & Nielsen, Eugene W. Doyle, San Francisco, Cal., for plaintiff.

McCutchen, Black, Verleger & Shea, Jack D. Fudge, Ward L. Benshoof, James F. Vernon, Los Angeles, Cal., Fitzgerald, Abbott & Beardsley, Llewellyn E. Thompson, II, Oakland, Cal., for defendants.

MEMORANDUM OF OPINION

RENFREW, District Judge.

This action was originally filed on February 13, 1976, in the Superior Court of the State of California in and for the County of San Mateo against Exxon Corporation ("Exxon"), Exxon Company, U.S.A., and twenty fictitious individuals designated as "Does I through XX, inclusive." The pleadings state that, although plaintiff believes that each unnamed defendant is somehow responsible for the activity of which he complains, the true names of the Doe defendants are unknown and will be added by amendment when ascertained. No allegation concerning the citizenship of the unidentified defendants appears in the pleadings.

The original complaint requested monetary relief on three different theories — breach of an oral agreement, fraud, and negligent misrepresentation. The amended complaint, filed February 23, 1976, adds a fourth cause of action for conversion. The apparent basis of plaintiffs' claims as to the first three causes of action is an oral promise allegedly made by Exxon, Exxon Company, U.S.A., and four of the fictitious defendants. Paragraph III of both the original and the amended complaint states:

"Sometime during the month of February, 1973, plaintiff and defendants EXXON CORPORATION, EXXON COMPANY USA, DOE I, DOE II, DOE III and DOE IV made an oral agreement whereby plaintiff agreed to devote his best efforts and personal abilities to manage the aforementioned Exxon station on Westborough Boulevard in South San Francisco, County of San Mateo, so that there would be an increase in patronage and sales at said station. Defendants, and each of them, in exchange for said agreement, agreed to pay plaintiff certain commissions from the operation of the station and, additionally, to convert said station to a dealership for plaintiff during the months of April and May, 1973." Amended Complaint at 2. See Complaint at 2.

Thereafter, the charging allegations are directed at "defendants, and each of them."

The parties proceeded with pretrial motions and discovery in the Superior Court, but none of the Doe defendants was ever identified. At a conference held on January 14, 1977, the state court ordered the unidentified defendants "off calendar," and set a trial date of April 4, 1977.

The severance of the Doe defendants removed all doubt that there is complete diversity of citizenship between the parties. As Exxon Company, U.S.A., is not a separate corporate entity, but an operating division of Exxon, Exxon is the only real defendant in the action. Exxon is now and was at the time that the action was commended a New Jersey corporation with its principal place of business in New York; plaintiff is and has been since the filing of the action a citizen of California.

On February 1, 1977, defendant Exxon filed a petition for removal with this Court, on the grounds that the federal district court has diversity jurisdiction over the controversy pursuant to 28 U.S.C. § 1332 and the action is removable under 28 U.S.C. § 1441. In response, plaintiff filed a motion to remand on February 14, 1977, which Exxon opposed in a memorandum filed February 18, 1977. The motion was argued at a hearing before the Court on February 24, 1977. Defendant Exxon submitted a supplemental memorandum on March 1, 1972, to which plaintiff replied on March 9, 1977.

Having fully considered both the oral arguments and the written submissions of the parties, the Court entered an order granting plaintiff's motion and remanding the action on March 17, 1977. However, in light of the importance of the issue to those parties who seek removal from state courts and the eloquent opposition of counsel for defendant Exxon, the Court wished to explain its rationale for the decision in a memorandum of opinion.

Because the parties are citizens of different states and the requested relief satisfies the jurisdictional amount requirement, it is clear that the Court would have diversity jurisdiction over the controversy and that the action is one susceptible of removal under 28 U.S.C. § 1441(a) and (b).¹ The crucial question, however, is whether the removal was timely. 28 U.S.C. § 1446(b) states:

"(b) The petition for removal of a civil action or proceeding shall be filed within thirty days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based, or within thirty days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter.

"If the case stated by the initial pleading is not removable, a petition for removal may be filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable."

The parties advance contradictory theories concerning the import of § 1446(b) for this litigation.

Relying primarily upon Southern Pac. Co. v. Haight, 126 F.2d 900 (9 Cir.), cert. denied, 317 U.S. 676, 63 S.Ct. 154, 87 L.Ed. 542 (1942), and Fred. Olson & Co. v. Moore, 162 F.Supp. 82 (N.D.Cal.1958), defendant Exxon contends that the action was not removable as stated by either the original or the amended complaint. According to its theory, the case became removable only when the fictitious defendants were severed from the action because the fact of complete diversity had not previously been apparent. Quoting Fred. Olsen & Co. v. Moore, supra, 162 F.Supp. at 84, defendant argues:

"In cases such as this, where the plaintiff names fictitious defendants, the defendant may wait until dismissal of the fictitious defendants and it appears affirmatively that there is diversity of citizenship * * *. * * * A plaintiff who chooses to name Doe defendants in an action where actually there is diversity of citizenship may not claim that removal is untimely when he, himself, has pleaded facts which create a questionable situation as to whether or not there is diversity of citizenship." (Citation omitted.)

Inasmuch as the petition for removal was filed within thirty days of the January 14, 1977, order severing the fictitious defendants, defendant Exxon contends that the filing was timely.

Conversely, plaintiff argues that Exxon's failure to petition for removal within thirty days of its receipt of the pleadings mandates a remand of the action. Citing Jong v. General Motors Corporation, 359 F.Supp. 223 (N.D.Cal.1973), and Asher v. Pacific Power and Light Company, 249 F.Supp. 671 (N.D.Cal.1965), he asserts that, had Exxon petitioned for removal at the inception of this action, the jurisdictional question would have been determined without consideration of the fictitious defendants. He quotes Jong v. General Motors Corporation, supra, 359 F.Supp. at 227, for the proposition that

"* * * Doe defendants should be disregarded in determining diversity of citizenship where the charging allegations of the complaint are directed at all the defendants jointly, with no attempt to designate the specific role or identity of any of the Doe defendants."

Contending that the charging paragraphs of the pleadings in this action are so general as to fall within the ambit of this rule of law, plaintiff argues that the action was removable as filed.

Accepting the viability of the case law advanced by plaintiff, defendant Exxon counters that the two lines of cases allow a defendant two alternatives. Where the citizenship of Doe defendants is in doubt, he may take immediate steps to remove the action to federal court by demonstrating that the unidentified parties are but formal and unnecessary defendants, or he may wait to remove until the plaintiff takes some affirmative action indicating his intention not to proceed against unidentified defendants. See 1A J. Moore, Federal Practice ¶ 0.168.3-5, at 479-480, n. 27.

The Court agrees that a defendant does have such an option when a plaintiff pleads with particularity against Doe defendants, as was done in Southern Pac. Co. v. Haight, supra, 126 F.2d 900. In that case, the Doe defendants were specifically alleged to be operating employees of the company and citizens of the same state as the plaintiff. In addition, while alleging that the Company maintained and operated a railroad intersection in a negligent manner, the plaintiff specifically charged that the Doe defendants were negligent in failing to warn or notify him of the presence of railroad cars in an intersection.

However, a defendant enjoys no such option when unidentified defendants are rotely included in the complaint. The rationale for this distinction is simple. Although actions which entail specific averments against adequately described, fictitious defendants are not removable as filed if the citizenship of the Does is in doubt, those which include unnamed defendants without apparent reason are removable if diversity between the named parties is clear and, must, therefore, be removed within the first thirty-day period allowed by 28 U.S.C. § 1446(a).

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