Sanchez v. Lane Bryant, Inc.

• Decision Date: 17 August 2015
• Docket Number: Case No. 2:15–cv–04247–CAS (ASx)
• Citation: 123 F.Supp.3d 1238
• Parties: Brenda Sanchez v. Lane Bryant, Inc.; et al.
• Court: U.S. District Court — Central District of California

123 F.Supp.3d 1238

Brenda Sanchez

v.Lane Bryant, Inc.; et al.

Case No. 2:15–cv–04247–CAS (ASx)

United States District Court, C.D. California.

Filed August 17, 2015

Martin Isaac Aarons, The Aarons Law Firm APC, Sherman Oaks, CA, for Brenda Sanchez.

Craig Gerald Staub, Carly M. Nese, Littler Mendelson PC, Los Angeles, CA, for Lane Bryant, Inc.; et al.

Proceedings: PLAINTIFF'S MOTION TO REMAND DEFENDANT JULIE TSE'S MOTION TO DISMISS

Present: The Honorable CHRISTINA A. SNYDER, District Judge

I. INTRODUCTION

On April 29, 2015, plaintiff Brenda Sanchez ("plaintiff") filed a complaint in the Los Angeles County Superior Court against defendants Lane Bryant, Inc. ("Lane Bryant"), Julie Tse ("Tse"), and Does 1 through 10 (collectively, "defendants"). Dkt. 1. On June 4, 2015, Lane Bryant filed a notice of removal on the basis of diversity jurisdiction. Not. of Removal ¶ 1. Defendants contend in their notice of removal that defendant Lane Bryant is incorporated in Delaware, and has its principal place of business in Ohio. Id. ¶ 12. Defendants further contend that the California citizenship of Tse should be disregarded because this defendant was fraudulently joined. Id. ¶ 13.

Plaintiff asserts the following claims: (1) defamation (against all defendants); (2) discrimination on the basis of age in violation of the Fair Employment and Housing Act ("FEHA"), Cal. Gov. Code 1290 et seq. (against Lane Bryant and Does 1 through 10); (3) wrongful termination in violation of public policy (against Lane Bryant and Does 1 through 10); (4) breach of implied-in-fact contract (against Lane Bryant and Does 1 through 10); and (5) failure to prevent discrimination in violation of FEHA (against Lane Bryant and Does 1 through 10). Dkt. 1.

On June 30, 2015, plaintiff filed a motion to remand this case to state court. Dkt. 13. Defendants opposed the motion on July 28, 2015, Dkt. 18, and plaintiff replied on August 3, 2015, Dkt. 20. On July 15, 2015, Tse filed a motion to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(5) and 12(b)(6). Dkt. 15. Plaintiff opposed that motion on July 28, 2015, Dkt. 17, and defendants filed a reply on August 3, 2015, Dkt. 17, 19. The Court held a hearing on August 17, 2015. Having considered the parties' arguments, the Court finds and concludes as follows.

II. BACKGROUND

Plaintiff's complaint alleges the following: plaintiff, a woman over the age of forty, was hired by Lane Bryant in November 1991 to work as a sales associate. Compl. ¶¶ 2, 9. Several months later, plaintiff was promoted to work as a co-manager. Id. ¶ 9. Around 1997 or 1998, plaintiff was promoted again to work as a store manager. Id. Plaintiff worked in this position until she was terminated in August 2014. Id. Throughout her employment, plaintiff alleges, she received awards and recognition for her performance as a store manager. Id. ¶ 10.

On two occasions during her employment, plaintiff underwent surgery, once on her right knee and again for a tumor. Id. ¶ 11. Plaintiff contends that, on both of these occasions, Tse made comments to the effect that plaintiff's going on leave as a result of her surgeries was an inconvenience to Tse. Id. Plaintiff claims that these comments made her feel guilty. Id.

Plaintiff alleges that on different occasions during her employment, Tse made comments about plaintiff's age; specifically, that she needed to look younger and more trendy, that she was not being fresh enough, not keeping up with the trends and was very old school, and that there was a need to have fresh faces in the store. Id. ¶ 12.

In August 2014, Tse fired plaintiff citing that she was a poor performer. Id. ¶ 13. Plaintiff disputes the claim that she was a poor performer and asserts that she was fired because of her age. Id.

Plaintiff asserts a single claim for defamation against all defendants, including Tse. Dkt. 1. The basis for this claim is that defendants caused the publication of defamatory statement including "express and implied accusations...that Plaintiff violated Defendant Employer's policies, expressly and impliedly that Plaintiff was a poor performer, incompetent, an unskilled store manager, was not able to perform as store manager, and not being able to speak to competencies [sic]." Compl. ¶¶ 17, 21. While the precise dates of publication of these statements are not alleged, plaintiff alleges they began on or before August 11, 2014, and have continued thereafter. Id. ¶ 18. Plaintiff alleges that any investigation defendants conducted into the truth of these statements was "nonexistent and at best reckless." ¶ 27. Plaintiff also alleges that these statements were knowingly false and that they have caused harm to her personal and professional reputations. Id. ¶¶ 21, 30.

III. LEGAL STANDARD

Removal is proper where the federal courts have original jurisdiction over an action brought in state court. 28 U.S.C. § 1441(a). Pursuant to 28 U.S.C. § 1332(a), the federal courts have original jurisdiction over state law actions only where the amount in controversy exceeds $75,000 and the action is between parties of diverse citizenship.

An exception to the requirement of complete diversity exists where it appears that a plaintiff has fraudulently joined a "sham" non-diverse defendant. Judge William W. Schwarzer et al., California Practice Guide: Federal Civil Procedure Before Trial ¶ 2:670 (The Rutter Group 2005). If a court finds fraudulent joinder of a "sham" defendant, it may disregard the citizenship of the "sham" defendant for removal purposes. Id. "Fraudulent joinder" is a term of art, and requires no proof of scienter on the part of the plaintiff. Id. ¶ 2:671. Instead, a non-diverse defendant is said to be fraudulently joined where "the plaintiff fails to state a cause of action against a resident defendant, and the failure is obvious according to the settled rules of the state." McCabe v. Gen. Foods Corp. , 811 F.2d 1336, 1339 (9th Cir.1987).

Courts also recognize a "strong presumption" against removal jurisdiction; the burden is on the removing defendant to demonstrate that removal is proper. See, e.g. , Gaus v. Miles, Inc. , 980 F.2d 564, 566 (9th Cir.1992). Similarly, "courts generally employ a presumption against fraudulent joinder." Diaz v. Allstate Ins. Grp. , 185 F.R.D. 581, 586 (C.D.Cal.1998) (citations omitted).

Accordingly, "[t]he burden of proving a fraudulent joinder is a heavy one. The removing party must prove that there is absolutely no possibility that the plaintiff will be able to establish a cause of action against the in-state defendant in state court ...." Green v. Amerada Hess Corp. , 707 F.2d 201, 205 (5th Cir.1983) (citations omitted); see also Dodson v. Spiliada Mar. Corp. , 951 F.2d 40, 42 (5th Cir.1992) ("We do not decide whether the plaintiff will actually or even probably prevail on the merits, but look only for a possibility that he may do so. If that possibility exists, then a good faith assertion of such an expectancy in a state court is not a sham ... and is not fraudulent in fact or in law." (citations and internal quotation marks omitted)); Good v. Prudential Ins. Co. of Am. , 5 F.Supp.2d 804, 807 (N.D.Cal.1998) ("[T]he defendant must demonstrate that there is no possibility that the plaintiff will be able to establish a cause of action in state court against the alleged sham defendant." (citing Dodson , 951 F.2d at 42 )).

In accordance with this high standard, courts must resolve all issues of fact and all ambiguities in the law in favor of the non-removing party when deciding whether fraudulent joinder exists in a given case. Dodson , 951 F.2d at 42. Further, the court may consider "affidavits or other evidence (presented by either party) on the issue of whether a particular defendant's joinder is sham or ‘fraudulent.’ " Schwarzer, ¶ 2:681 (citing W. Am. Corp. v. Vaughan – Basset Furniture , 765 F.2d 932, 936 n. 6 (9th Cir.1985) ).

IV. ANALYSIS

Defendants argue that removal is proper because complete diversity exists and the amount in controversy exceeds $75,000. Specifically, defendants argue that Tse—who is a citizen of California—is a "sham" defendant whose citizenship should be disregarded, leaving completely diverse parties. Not. of Removal ¶ 13. Plaintiff counters that Tse is not a "sham" defendant and, as such, complete diversity does not exist and removal was improper. Mot. to Remand at 2.

Plaintiff's complaint alleges a claim for defamation against Tse. A claim for defamation consists of a publication of a false, defamatory, and unprivileged statement that has a natural tendency to injure or that causes special damage. E.g. , Smith v. Maldonado , 72 Cal.App.4th 637, 645, 85 Cal.Rptr.2d 397 (1999) ; Hernandez v. First Student, Inc. , 2010 WL 5313293, at *3 (C.D.Cal. Dec. 16, 2010) ; 5 Witkin, Summ. Cal. Law , Torts § 529 (10th ed. 2005).

In Morales v. Gruma Corporation , 2013 WL 6018040, at *6 (C.D.Cal. Nov. 12, 2013), this Court granted the plaintiff's motion to remand, finding that a non-diverse defendant was not fraudulently joined. In that case, the plaintiff, a California citizen, filed an action for disability discrimination, unlawful employment practices, and defamation against an out of state corporation and two of its officers, both California citizens. Id. at *1–2. Defendants removed the case to federal court, arguing that the California officers were fraudulently joined. Id. at *1. The basis for plaintiff's defamation claim was that defendants had caused to be published defamatory statements, including "expressed and implied accusations that Plaintiff violated company policy and/or the law, engaged in misconduct, and expressly and impliedly accusing Plaintiff of potential criminal activity." Id. at *2. The plaintiff alleged that the defamatory publications began "on or before October 12, 2012, and continued at least through the present," and that the purpose of these statements was to justify plaintiff's termination. Id. The plaintiff alleged that these statements were false, and were...