Kaplan v. BMW of N. Am., LLC

• Decision Date: 23 September 2021
• Docket Number: 21-CV-857 TWR (AGS)
• Parties: PAUL B. KAPLAN and KIM C. KAPLAN, Plaintiffs, v. BMW OF NORTH AMERICA, LLC, a Delaware Limited Liability Company; and DOES 1 through 30, inclusive, Defendants.
• Court: U.S. District Court — Southern District of California

PAUL B. KAPLAN and KIM C. KAPLAN, Plaintiffs, v. BMW OF NORTH AMERICA, LLC, a Delaware Limited Liability Company; and DOES 1 through 30, inclusive, Defendants.

No. 21-CV-857 TWR (AGS)

United States District Court, S.D. California

September 23, 2021

ORDER (1) GRANTING PLAINTIFFS' MOTION TO REMAND AND (2) REMANDING ACTION TO THE SUPERIOR COURT OF CALIFORNIA COUNTY OF SAN DIEGO

(ECF NO. 6)

HONORABLE TODD W. ROBINSON, UNITED STATES DISTRICT JUDGE

Presently before the Court is Plaintiffs Paul B. and Kim C. Kaplan's Motion to Remand Complaint (“Mot., ” ECF No. 6), as well as the Response in Opposition to the Motion (“Opp'n, ” ECF No. 10) filed by Defendant BMW of North America, LLC (“BMW”) and Plaintiffs' Reply in Support of their Motion (“Reply, ” ECF No. 14).^[1] The Court heard oral argument on September 22, 2021. (See ECF No. 17.) Having carefully considered the Parties' arguments, evidence, and the relevant law, the Court GRANTS Plaintiffs' Motion to Remand and REMANDS this action to the Superior Court of California, County of San Diego.

BACKGROUND

On March 30, 2021, Plaintiffs filed a Complaint against BMW in the Superior Court of California, County of San Diego. (See generally ECF No. 1-4 (“Compl.”).) In their Complaint, Plaintiffs allege that they purchased a new 2012 BMW X3, VIN 5UXWX7C56CL737601 (the “Vehicle”) from BMW of Encinitas on December 30, 2011. (See Id. ¶ 9.) They made a $50, 000 cash down payment, received a $500 rebate, and financed $11, 648.14. (See id.) Including all associated fees, the total amount payable on the purchase of the Vehicle was $62, 261.68. (See id.) Although BMW made express and implied warranties regarding the Vehicle, (see Id. ¶¶ 10-11), “[t]he Vehicle was delivered to Plaintiffs with serious defects and nonconformities under the warranty and developed other serious defects and nonconformities under BMW's warranty.” (See Id. ¶ 12; see also Id. ¶¶ 17-39.) Plaintiffs therefore allege three causes of action for violation of the Song-Beverly Consumer Warranty Act (the “Act”), California Civil Code §§ 1790, et seq.: (1) breach of express warranty, (2) breach of implied warranty, and (3) failure to service in violation of Section 1793.2. (See Compl. ¶¶ 41-81.)

On May 3, 2021, BMW filed an Answer in state court, (see generally ECF Nos. 1-3, 2), and, on the same day, a Notice of Removal in this Court, alleging diversity subject-matter jurisdiction pursuant to 28 U.S.C. § 1332(a). (See generally ECF No. 1 (“NOR”).) Specifically, BMW alleges that “[c]omplete diversity . . . exists, ” (see Id. ¶ 15; see also Id. ¶¶ 10-15), and that the amount in controversy exceeds $75, 000 including the civil penalties under the Act and prospective attorneys' fees. (See Id. ¶ 19; see also Id. ¶¶ 16-19.) On June 2, 2021, Plaintiff filed the instant Motion, arguing that “Defendant BMW . . . has not plausibly alleged the amount in controversy exceeds $75, 000.00.” (See Not. at 2.)

LEGAL STANDARD

“The right of removal is entirely a creature of statute and a suit commenced in a state court must remain there until cause is shown for its transfer under some act of Congress.” Syngenta Crop Protection, Inc. v. Henson, 537 U.S. 28, 32 (2002). A suit filed in state court may be removed to federal court if the federal court would have had original jurisdiction over the suit. See 28 U.S.C. § 1441(a). “Federal courts are courts of limited jurisdiction. They possess only that power authorized by Constitution and statute.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Removal is proper when a case originally filed in state court presents a federal question or where there is diversity of citizenship among the parties and the amount in controversy exceeds $75, 000. See 28 U.S.C. §§ 1331, 1332(a). “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).

The party invoking the removal statute bears the burden of establishing that federal subject-matter jurisdiction exists. Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir. 1988). It is “presume[d] that federal courts lack jurisdiction unless the contrary appears affirmatively from the record, ” DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 342 (2006) (quoting Renne v. Geary, 501 U.S. 312, 316 (1991)), and courts “strictly construe the removal statute against removal jurisdiction.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (citing Boggs v. Lewis, 863 F.2d 662, 663 (9th Cir. 1988)); Takeda v. Nw. Nat'l Life Ins. Co., 765 F.2d 815, 818 (9th Cir. 1985)). Therefore, “[f]ederal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance.” Gaus, 980 F.2d at 566 (citing Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1979)).

ANALYSIS

BMW removed Plaintiffs' Complaint from Superior Court on the basis of diversity jurisdiction under 28 U.S.C. § 1332(a). (See, e.g., NOR ¶ 6.) Through the instant Motion, Plaintiffs seek to remand their action to Superior Court. (See generally Mot.; ECF No. 6-1 (“Mem.”).) Plaintiffs do not contest that there is complete diversity of citizenship among the Parties. (See generally id.; see also Opp'n at 6.) Instead, Plaintiffs contend that BMW has failed to meet its burden of establishing that the amount in controversy exceeds $75, 000. (See generally Mot.)

Federal courts have diversity jurisdiction “where the amount in controversy” exceeds $75, 000, and the parties are of “diverse” state citizenship. See 28 U.S.C. § 1332(a). A defendant seeking to remove a case to federal court must provide only a “short and plain statement of the grounds for removal.” See 28 U.S.C. § 1446(a). Consequently, “when a defendant seeks federal-court adjudication, the defendant's amount-in-controversy allegation should be accepted when not contested by the plaintiff or questioned by the court.” See Dart Cherokee Basin Operating Co. v. Owens, 574 U.S. 81, 87 (2014). But “[i]f the plaintiff [or the court] contests the defendant's allegation, § 1446(c)(2)(B) instructs: ‘[R]emoval . . . is proper on the basis of an amount in controversy asserted' by the defendant ‘if the district court finds, by the preponderance of the evidence, that the amount in controversy exceeds' the jurisdictional threshold.” See Id. at 88 (third and fourth alterations in original).

“[T]he plaintiff can contest the amount in controversy by making either a ‘facial' or ‘factual' attack on the defendant's jurisdictional allegations.” Harris v. KM Indus., Inc., 980 F.3d 694, 699 (9th Cir. 2020) (citing Salter v. Quality Carriers, 974 F.3d 959, 964 (9th Cir. 2020)). “A ‘facial' attack accepts the truth of the [defendant's] allegations but asserts that they ‘are insufficient on their face to invoke federal jurisdiction.'” Id. (alteration in original) (quoting Salter, 974 F.3d at 964). “A factual attack ‘contests the truth of the . . . allegations' themselves, ” id. (alteration in original) (quoting Salter, 974 F.3d at 964), or “make[s] a reasoned argument as to why any assumptions on which they are based are not supported by evidence.” Id. at 700 (citing Salter 974 F.3d at 964; Ibarra v. Manheim Invs., Inc., 775 F.3d 1193, 1199 (9th Cir. 2015)). “When a plaintiff mounts a factual attack, the burden is on the defendant to show, by a preponderance of the evidence, that the amount in controversy exceeds the . . . jurisdictional threshold.” Id. at 699 (citing Ibarra, 775 F.3d at 1197). “[W]hen the defendant relies on a chain of reasoning that includes assumptions to satisfy its burden of proof, the chain of reasoning and its underlying assumptions must be reasonable ones.” LaCross v. Knight Transp. Inc., 775 F.3d 1200, 1202 (9th Cir. 2015) (citing Ibarra, 775 F.3d. at 1199). “Both parties may submit evidence supporting the amount in controversy before the district court rules.”^[2] Harris, 980 F.3d at 699 (citing Salter, 974 F.3d at 963; Ibarra, 775 F.3d at 1197).

“In determining the amount in controversy, courts first look to the complaint.” Ibarra, 775 F.3d at 1197. “Generally, ‘the sum claimed by the plaintiff controls if the claim is apparently made in good faith.'” Id. (quoting St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 289 (1938)). But “[w]here it is not facially evident from the complaint that more than $75, 000 is in controversy, the removing party must prove, by a preponderance of the evidence, that the amount in controversy meets the jurisdictional threshold.” Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003) (per curiam). When a damages estimate is articulated in the complaint and not “repeated in the Prayer for Relief . . ., the complaint fails to allege a sufficiently specific total amount in controversy, ” and the preponderance of evidence standard applies. See Guglielmino v. McKee Foods Corp., 506 F.3d 696, 701 (9th Cir. 2007).

Here Plaintiffs allege only that, “[i]ncluding all associated fees, the total amount paid or payable on the purchase of the Vehicle is $62, 261.68.” (See Compl. ¶ 9.) Plaintiffs do not plead that the amount in controversy exceeds $75, 000. (See generally id.; see also Id. at Prayer for Relief.) Rather, BMW makes certain assumptions-including that (1) the amount paid for the Vehicle is equal to the sales price in the contract, (2) there is no mileage offset, (3) a jury would award Plaintiffs the maximum civil penalty under the Act, and (4) Plaintiffs would be entitled to significant attorneys' fees, (see NOR ¶ 19; Opp'n at 8-16)-to establish that the amount in controversy exceeds $75, 000. Because Plaintiffs have challenged those assumptions, however, the burden is on BMW to establish by a preponderance of the evidence that the amount in...