McIntire v. Ford Motor Co.

• Decision Date: 06 March 2001
• Docket Number: No. C-3-00-213.,C-3-00-213.
• Citation: 142 F.Supp.2d 911
• Parties: John McINTIRE, et al., Plaintiffs, v. FORD MOTOR COMPANY, Defendant.
• Court: U.S. District Court — Southern District of Ohio

142 F.Supp.2d 911

John McINTIRE, et al., Plaintiffs, v. FORD MOTOR COMPANY, Defendant.

No. C-3-00-213.

United States District Court, S.D. Ohio, Western Division.

March 6, 2001.

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Ronald Lee Burdge, Burdge Law Office, Dayton, OH, for Plaintiffs.

Elizabeth A. McNellie, Baker & Hostetler, Columbus, OH, John H. Beisner, Brian Brooks, Benjamin Jacewicz, O'Melveny & Myers LLP, Washington, DC, for Defendant.

DECISION AND ENTRY SUSTAINING PLAINTIFFS' MOTION FOR REMAND (DOC. # 6); DEFENDANT'S REQUEST FOR ORAL ARGUMENT (DOC. # 10) DENIED; REMAINING PENDING MOTIONS (DOC. # 2, DOC. # 3, DOC. # 4, DOC. # 13, AND DOC. # 17) TO BE ADDRESSED BY STATE COURT; CAPTIONED CAUSE REMANDED TO THE MONTGOMERY COUNTY COURT OF COMMON PLEAS; JUDGMENT TO ENTER ACCORDINGLY; TERMINATION ENTRY.

RICE, Chief Judge.

The instant litigation arises out of alleged intentional misrepresentations by Defendant Ford Motor Company ("Ford") and its Ohio dealers to Ohio consumers, stating that Ford's Lemon Law arbitration process was mandatory and was approved by the Ohio Attorney General and the Federal Trade Commission ("FTC") when, in fact, it was not. Plaintiffs John McIntire, Opal Napier, and Timothy Bissinger (collectively, "Plaintiffs"), as class representatives, each allege that they were informed by Defendant that Ford's Dispute Settlement Board was legally qualified as an informal dispute resolution mechanism under Ohio's Lemon Law and the Magnuson Moss Warranty Act ("MMWA"), and that they could not pursue a judicial action because of such qualification. Plaintiffs seek injunctive relief, prohibiting further misrepresentations and requiring Ford to provide notice of its past violations to class members and to others through signs and newspaper advertisements.

A number of motions are pending before the Court, to wit: 1) Plaintiffs' Motion for Remand (Doc. # 6); 2) Defendant's Motion to Dismiss (Doc. # 2); 3) Plaintiffs' Motion to Stay (Doc. # 3); 4) Defendant's Motion for a Protective Order (Doc. # 4); 5) Plaintiffs' Motion for Partial Summary Judgment (Doc. # 13); and 6) Defendant's Motion for Summary Judgment for Mootness (Doc. # 17). Because the Court concludes that this litigation must be remanded to state court, the Court will only address Plaintiffs' Motion for Remand (Doc. # 6).¹

I. Plaintiffs' Motion for Remand (Doc. # 6)

The party seeking to litigate in federal court bears the burden of establishing the existence of federal subject matter jurisdiction. McNutt v. General Motors Acceptance Corp. of Indiana, 298 U.S. 178, 189, 56 S.Ct. 780, 80 L.Ed. 1135 (1936). This is no less true where, as here, it is the defendant, rather than the plaintiff, who seeks the federal forum. E.g., Ahearn v. Charter Twp. of Bloomfield, 100 F.3d 451, 453-54 (6th Cir.1996). When the party asserting federal jurisdiction finds its allegations challenged, it must submit evidence substantiating its claims. Amen v. City of Dearborn, 532 F.2d 554, 560 (6th Cir.1976). The removing defendant's burden is to prove, by a preponderance of the evidence, that the jurisdictional facts it alleges are true. Gafford v. General Electric Co., 997 F.2d 150, 158 (6th Cir.1993). The district court has "wide discretion to allow affidavits, documents and even a limited evidentiary hearing to resolve disputed jurisdictional facts." Ohio Nat. Life Ins. Co. v. United States, 922 F.2d 320, 325 (6th Cir.1990) (citations omitted). The court may consider such evidence without turning the motion into one for summary judgment. Id.

Herein, Defendant has removed this litigation from state court on two bases. First, Ford has alleged that this Court has subject matter jurisdiction, pursuant to 28 U.S.C. § 1331, because Plaintiffs' state law claims are subject to complete preemption. Specifically, it states Congress intended for the MMWA to preempt state law completely and, therefore, Plaintiffs' state law claim, which hinges on the issue of Ford's compliance with FTC regulations, constitutes a federal claim. Although Defendant cites the doctrine of complete preemption, the essence of its assertion is that a consumer may only challenge an informal dispute resolution mechanism, based on non-compliance with the MMWA, in accordance with that statute. It may not be challenged by means of a state law claim (statutory or common law). Second, Defendant alleges in its Notice of Removal that subject matter jurisdiction by this Court is proper, because there is diversity of citizenship between the parties, and the amount in controversy exceeds $75,000.

Plaintiffs seek remand of this litigation to state court, arguing that the only question before the Court is whether Defendant violated § 1345.02(B)(10) of the Ohio Consumer Sales Practices Act. Thus, Plaintiffs argue, no federal question is implicated. Plaintiffs further argue that this Court does not have subject matter jurisdiction, pursuant to 28 U.S.C. § 1332, because the amount in controversy is less than the jurisdictional minimum. The Court will first address the parties' arguments regarding federal question subject matter jurisdiction, and then turn to subject matter jurisdiction based on diversity of citizenship.

A. Federal Question Jurisdiction

Federal preemption of state law comes in two flavors: conflict preemption and complete preemption. Conflict preemption arises where compliance with both federal and state law is physically impossible, or "where state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." Hines v. Davidowitz, 312 U.S. 52, 67, 61 S.Ct. 399, 85 L.Ed. 581 (1941); Silkwood v. Kerr-McGee Corp., 464 U.S. 238, 248, 104 S.Ct. 615, 78 L.Ed.2d 443 (1984); see Warner v. Ford Motor Co., 46 F.3d 531, 533 (6th Cir.1995)(en banc)(discussing difference between conflict and complete preemption). In contrast, "[i]f Congress evidences an intent to occupy a given field, any state law falling within that field is [completely] preempted." Pacific Gas & Elec. Co. v. State Energy Resources Conserv. & Dev. Comm'n, 461 U.S. 190, 103 S.Ct. 1713, 75 L.Ed.2d 752 (1983).

In determining whether a complaint invokes federal subject matter jurisdiction, the court ordinarily begins by examining the plaintiffs well-pleaded complaint. Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987). The "well-pleaded complaint rule" provides that "the plaintiff is the master of the complaint, that [for removal to be proper] a federal question must appear on the face of the complaint, and that the plaintiff may, by eschewing claims based on federal law, choose to have the cause heard in state court." Warner, 46 F.3d at 533. If the plaintiff's claim arises under state law, the mere assertion of federal preemption as a defensive argument will not confer federal question subject matter jurisdiction. As stated by the Supreme Court in Metropolitan Life Ins. Co. v. Taylor,

Federal pre-emption is ordinarily a federal defense to the plaintiffs suit. As a defense, it does not appear on the face of a well-pleaded complaint, and, therefore, does not authorize removal to federal court. One corollary of the well-pleaded complaint rule developed in the case law, however, is that Congress may so completely pre-empt a particular area that any civil complaint raising this select group of claims is necessarily federal in character.

Id. at 63-64, 107 S.Ct. 1542.

To date, however, the Supreme Court has applied the doctrine of complete preemption to only a few federal statutes, most notably section 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185, and section 1132(a) of the Employee Retirement Income and Security Act ("ERISA"). Strong v. Telectronics Pacing Sys., Inc., 78 F.3d 256, 259 (6th Cir.1996); Smith v. Provident Bank, 170 F.3d 609 (6th Cir.1999); see also El Paso Natural Gas Co. v. Neztsosie, 526 U.S. 473, 484, 119 S.Ct. 1430, 143 L.Ed.2d 635 (1999) (Price-Anderson Act's unusual preemption provision resembles complete preemption doctrine). The majority of federal circuits to address whether Congress intended to "occupy the field" when it enacted the MMWA have concluded that Congress did not intend to do so. E.g., Motor Vehicle Mfrs. Ass'n of U.S., Inc. v. Abrams, 899 F.2d 1315 (2d Cir.1990); Automobile Importers of America, Inc., v. State of Minn., 871 F.2d 717 (8th Cir. 1989); American Fin. Servs. Ass'n v. FTC, 767 F.2d 957, 989-90 (D.C.Cir.1985) ("The legislative history of the Magnuson-Moss Act and predecessor bills indicate that while Congress did not intend the [FTC's] regulations to `occupy the field,' it did intend FTC rules to have that preemptive effect which flows naturally from a repugnancy between the Commission's valid enactments and state laws."); Chrysler Corp. v. Texas Motor Vehicle Comm'n, 755 F.2d 1192 (5th Cir.1985) (Texas Lemon Law not preempted by MMWA); In re General Motors Corp. Engine Interchange Litigation, 594 F.2d 1106 (7th Cir.1979) (Congress adopted in substantial part, but did not preempt, state law remedies when it enacted MMWA). In Abrams, supra, the Second Circuit rejected the argument that the MMWA completely preempted state law after a thorough review of the statute's language and legislative history. The court reasoned:

We are not persuaded that Congress intended to occupy the field. Certainly, appellees have not met their burden of showing that the "clear and manifest purpose of Congress," in legislating in this area of traditional state regulation[,] was to preempt state law. Indeed, the purpose of Congress seems to have been just the opposite — that is, that federal law and state law should exist side by side. Thus, the Act directs the FTC to "prescribe rules setting forth minimum requirements for any informal dispute settlement procedure." Use of the term "minimum" strongly suggests that Congress intended federal law in this area to supplement, not supplant, the...