Salvestrini v. General Motors, LLC et al, No. 3:2023cv01556 - Document 15 (S.D. Cal. 2023)
Court Description: ORDER Denying 10 Motion to Remand. Signed by Judge Thomas J. Whelan on 11/29/2023. (exs)
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Salvestrini v. General Motors, LLC et al Doc. 15 1 2 3 4 5 6 7 8 9 10 UNITED STATES DISTRICT COURT 11 SOUTHERN DISTRICT OF CALIFORNIA 12 13 THOMAS SALVESTRINI, Case No.: 3:23-cv-1556-W-DDL Plaintiff, 14 15 v. 16 GENERAL MOTORS, LLC, a limited liability company; and DOES 1 through 10, inclusive, Defendants. 17 18 ORDER DENYING MOTION TO REMAND [DOC. 10] 19 20 Pending before the Court is Plaintiff Thomas Salvestrini’s motion ([Doc. 10] 21 “Motion for Remand”) to remand this case to the San Diego Superior Court. Defendant 22 opposes ([Doc. 14] “Opposition”). Plaintiff has failed to reply. 23 24 The Court decides the matter on the papers submitted and without oral argument. See Civ. R. 7.1(d)(1). For the following reasons, the Court DENIES the Motion. 25 26 27 28 I. RELEVANT BACKGROUND This case arises from Plaintiff’s alleged purchase of a 2021 Chevrolet Bolt (the “Vehicle”) from one of General Motors, LLC’s (“Defendant”) “authorized dealer[‘s]” for 1 3:23-cv-1556-W-DDL Dockets.Justia.com 1 an unspecified amount. (Complaint at ¶¶ 7-9.1) According to Plaintiff, the vehicle was 2 covered by: (1) an express warranty, under which Defendant promised that the Vehicle 3 “would be free from defects in materials, nonconformities, or workmanship during the 4 applicable warranty period and to the extent the [Vehicle] had defects, [Defendant] would 5 repair the defects”; as well as (2) an implied warranty that the “[Vehicle] would be of the 6 same quality as similar vehicles . . . [and] would be fit for the ordinary purposes for 7 which similar vehicles are used.” (Id. ¶¶ 10, 11.) The Complaint alleges, however, that 8 during the warranty period, the Vehicle “exhibited defects” and that when Plaintiff 9 notified Defendant of such “defects” and “attempted to invoke the applicable warranties,” 10 Defendant “represented to PLAINTIFF that they could and would make the [Vehicle] 11 conform to the applicable warranties . . . .” (Id. ¶ 13-14.) Specifically, Plaintiff alleges 12 that Defendant “issued a recall notice for the [Vehicle]” warning Plaintiff not to charge 13 the Vehicle’s battery above “90%”; not to let the battery’s mileage “fall below seventy 14 (70) miles remaining”; and not to “park[] [the Vehicle] indoors overnight” because the 15 Vehicle’s battery “may ignite.” (Id. at ¶ 18.) Yet, Plaintiff alleges that Defendant has 16 since failed to “make the [Vehicle] conform to the applicable warranties.” (Id. at ¶ 15.) 17 On August 17, 2023, Plaintiff filed a lawsuit against Defendant in the San Diego 18 Superior Court, entitled Thomas Salvestrini v. General Motors, LLC, et al., No.37-2023- 19 00035602-CU-BC-CTL. The Complaint asserts three causes of action under the Song- 20 Beverly Consumer Warranty Act (Cal. Civ. Code § 1790, et seq.) (the “Song-Beverly 21 Act”); one cause of action alleging fraud; and another alleging violations of the 22 California Business & Professions Code § 17200. (Complaint at ¶¶ 35-120.) Plaintiff 23 seeks, among other things, general, special, and actual damages; rescission of the 24 purchase contract and restitution of all monies expended; compensatory damages for the 25 diminution in value of the Vehicle; a civil penalty of two times Plaintiff’s actual, 26 27 28 1 The Complaint is attached to the Notice of Removal [Doc. 1] as Exhibit A [Doc. 1-2]. 2 3:23-cv-1556-W-DDL 1 incidental, and consequential damages; consequential and incidental damages, punitive 2 damages, attorney’s fees and costs, and prejudgment interest at the legal rate. (Id. Prayer 3 ¶¶ a–j.) 4 On or about August 22, 2023, Defendant removed the case to this Court based on 5 diversity jurisdiction. (Notice of Removal [Doc. 1].) Plaintiff now moves to remand, 6 arguing that Defendant has not met its burden of overcoming the presumption against 7 removal. (Motion for Remand at 6:19-26.) While Plaintiff does not actually contest any 8 of Defendant’s allegations regarding the existence of diversity jurisdiction, Plaintiff 9 contends that Defendant must presently prove the existence of diversity jurisdiction by a 10 preponderance of the evidence and complains that Defendant has not yet produced such 11 evidence. (Motion for Remand at 7:16-11:2.) Defendant responds that it is not required 12 to prove the existence of jurisdiction by a preponderance of the evidence at this stage. 13 (Opposition at 6:12-25.) Plaintiff has not filed a reply. 14 15 16 II. LEGAL STANDARD “The district courts shall have original jurisdiction of all civil actions where the 17 matter in controversy exceeds the sum or value of $75,000, exclusive of interest and 18 costs, and is between— (1) citizens of different States . . . .” 28 U.S.C. § 1332. 19 “Federal courts are courts of limited jurisdiction.” Kokkonen v. Guardian Life Ins. 20 Co. of Am., 511 U.S. 375, 377 (1994). “They possess only that power authorized by 21 Constitution or a statute, which is not to be expanded by judicial decree.” Id. (internal 22 citations omitted). “It is to be presumed that a cause lies outside this limited jurisdiction 23 and the burden of establishing the contrary rests upon the party asserting jurisdiction.” 24 Id. (internal citations omitted). 25 Consistent with the limited jurisdiction of federal courts, the removal statute is 26 strictly construed against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 27 (9th Cir. 1992). “The strong presumption against removal jurisdiction means that the 28 defendant always has the burden of establishing that removal is proper.” Id. “Federal 3 3:23-cv-1556-W-DDL 1 jurisdiction must be rejected if there is any doubt as to the right of removal in the first 2 instance.” Id. 3 In this vein, Plaintiff’s Motion argues that Defendant has the “burden of proving, 4 by a preponderance of the evidence” that removal is proper. (Motion for Remand at 7:5- 5 8.) However, for purposes of the amount in controversy requirement, “the notice of 6 removal must include only ‘a plausible allegation that the amount in controversy exceeds 7 the jurisdictional threshold.’” Schneider v. Ford Motor Co., 756 F. App'x 699, 700 (9th 8 Cir. 2018) (quoting Dart Cherokee Basin Operating Co., LLC v. Owens, 574 U.S. 81, 89 9 (2014)); Chavez v. JPMorgan Chase & Co., 888 F.3d 413, 416 (9th Cir. 2018) (applying 10 Dart Cherokee’s holding regarding the preponderance of the evidence standard to 11 diversity cases beyond the CAFA context). Courts only move to Plaintiff’s desired 12 preponderance of the evidence standard “after ‘the plaintiff contests, or the court 13 questions, the defendant’s allegation’ and ‘both sides submit proof.’” Schneider, 756 F. 14 App'x at 700. The same is true for the diversity of citizenship requirement. Acad. of 15 Country Music v. Cont'l Cas. Co., 991 F.3d 1059, 1068 (9th Cir. 2021) (“[N]otice of 16 removal ‘need not contain evidentiary submissions’ but only plausible allegations of the 17 jurisdictional elements.”). 18 Here, Defendant’s Notice of Removal plainly alleges that the diversity of 19 citizenship and amount in controversy requirements are met and does so in detail. 20 (Notice of Removal at ¶¶ 10-24; see infra Section III.) Specifically, the Notice of 21 Removal alleges that Plaintiff is a citizen of California while Defendant is a citizen of 22 Michigan and Detroit. (Complaint at ¶ 1; Notice of Removal at ¶ 11-14.) The Notice of 23 Removal also alleges that the amount in controversy in this case is: (1) approximately 24 $38,467.00 2 in actual damages; plus (2) roughly $50,000 in potential attorney’s fees; 25 along with (3) a civil penalty up to twice the amount of actual damages (~$76,934.00). 26 27 28 2 See infra Section III(b)(1). 4 3:23-cv-1556-W-DDL 1 (Notice of Removal at ¶¶ 17-19; see infra Section III.) Thus, Defendant has plausibly 2 alleged that both the diversity of citizenship and amount in controversy requirements are 3 met. 4 From there, Plaintiff could require Defendant prove these allegations by a 5 preponderance of the evidence if he actually contested any of these allegations in his 6 Motion. However, Plaintiff’s Motion does not actually contest any of Defendant’s 7 allegations. Instead, the Motion simply asserts that Defendant has the burden of 8 establishing jurisdiction by a “preponderance of the evidence” without ever identifying 9 which of Defendant’s allegations Plaintiff contests. (See Motion for Remand at 9:22-24.) 10 If Plaintiff cannot or will not identify which of Defendant’s diversity of citizenship or 11 amount in controversy allegations he contests, the preponderance of the evidence 12 standard is not triggered. 13 Regardless, even if Plaintiff had identified allegations in the Notice of Removal 14 that he contests, or if the Court questioned such allegations, Defendant has also satisfied 15 the more stringent preponderance of the evidence standard by attaching a declaration to 16 the Notice of Removal containing evidence supporting its contention that the parties are 17 diverse and that the amount in controversy exceeds $75,000. (See Notice of Removal at 18 Exs. A-C; infra Section III.) Plaintiff, meanwhile, failed to present the Court with any 19 contradictory evidence. 20 21 22 III. DISCUSSION As outlined above, the Court will not require Defendant to prove its allegations of 23 diversity of citizenship and amount in controversy by a preponderance of the evidence 24 (although Defendant has also satisfied that burden). From here, the Court turns to 25 evaluating whether Defendant has met its burden of plausibly alleging that the parties are 26 diverse and that the amount in controversy exceeds $75,000.00. 27 28 5 3:23-cv-1556-W-DDL 1 A. 2 To establish citizenship for diversity purposes, a natural born person must be a Diversity of Citizenship 3 citizen of the United States and be domiciled in a particular state. Kantor v. Wellesley 4 Galleries, Ltd., 704 F.2d 1088, 1090 (9th Cir. 1983). Persons are domiciled in the place 5 they reside with the intent to remain or to which they intend to return. See Kanter v. 6 Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). A corporation is a citizen of the 7 state in which it is incorporated and of the state where it has its principal place of 8 business. 28 U.S.C. 1332(d). LLCs are citizens of the states in which its members are 9 citizens. See Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 10 2006) (“[L]ike a partnership, an LLC is a citizen of every state of which its 11 owners/members are citizens.”). 12 Here, the Notice of Removal alleges that there is complete diversity of citizenship 13 in this case. (Notice of Removal at ¶ 10.) Specifically, Defendant alleges that Plaintiff is 14 a citizen of California while Defendant (an LLC) is 100% owned by General Motors 15 Holdings, LLC; who in turn is 100% owned by General Motors Company—which is a 16 Delaware corporation with its principal place of business in Michigan. (Id. at ¶ 12.) 17 Thus, Defendant alleges complete diversity exists because it is a citizen of Delaware and 18 Michigan while Plaintiff is a citizen of California. (Id. at ¶ 14.) Furthermore, Plaintiff’s 19 own Complaint alleges that he is a citizen of California. (Complaint at ¶ 1.) Nor does 20 Plaintiff ever actually contest that the parties are diverse. Accordingly, the Court finds 21 that Defendant has met its burden of plausibly alleging that the diversity of citizenship 22 requirement is met. 23 24 B. 25 In calculating the amount in controversy, courts must consider “the ‘amount at Amount in Controversy 26 stake in the underlying litigation.’” Fritsch v. Swift Transportation Co. of Arizona, LLC, 27 899 F.3d 785, 793 (9th Cir. 2018) (quoting Chavez, 888 F.3d at 417-18). Thus, “the 28 6 3:23-cv-1556-W-DDL 1 amount in controversy includes all relief claimed at the time of removal to which the 2 plaintiff would be entitled if she prevails.” Id. 3 4 1. 5 Actual Damages While the Complaint does not specify a damages figure, Defendant’s Notice of 6 Removal and accompanying Kuhn Declaration 3 alleges that the average manufacture’s 7 suggested retail price of the 2021 Chevrolet Bolt (the same model year Plaintiff alleges 8 he purchased) was $38,467.00. (Notice of Removal at ¶ 17; Kuhn Decl. at ¶ 8.) See 9 Schneider, 756 F. App'x at 701 (“Ford satisfied that more stringent [preponderance of the 10 evidence] standard by attaching a declaration to its notice of removal. That declaration 11 provided evidence that approximately 68,255 new F-150s from model years 2015-2017 12 were sold in California during the five years between the class date and the date the 13 lawsuit was filed, and that the F-150s’ average MSRP was $45,498.94 for those model 14 years.”). Since Plaintiff does not allege how much he actually paid for the Vehicle (a 15 number which he undoubtedly knows) the Court will accept Defendant’s allegations that 16 the actual damages at issue are $38,467.00. 17 Defendant now states in its Opposition that Plaintiff actually purchased the Vehicle 18 for $40,235.00. (Opposition at 9:7-10.) However, since (as explained above) the Court 19 is deciding the Motion simply based on the allegations in the Notice of Removal and the 20 amount in controversy requirement is easily met using the lower $38,467.00 figure, the 21 Court will not look to extrinsic sources like the Opposition in determining the actual 22 damages at issue. For purposes of this order, the Court will consider $38,467.00 to be the 23 actual damages at issue. 24 25 Accordingly, Defendant must find at least an additional $36,533.01 to exceed the required $75,000 in controversy. 26 27 28 3 The Kuhn Declaration is attached to the Notice of Removal as Doc. 1-4. 7 3:23-cv-1556-W-DDL 1 2 3 2. Attorney’s Fees 28 U.S.C. section 1332 instructs that when calculating the amount in controversy, 4 courts should exclude “interest and costs.” However, the Ninth Circuit has made clear 5 that “attorneys’ fees award under fee-shifting statutes or contracts are included in the 6 amount in controversy.” Fritsch v. Swift Transportation Co. of Arizona, LLC, 899 F.3d 7 785, 794 (9th Cir. 2018). Indeed, Cal. Civ. Code section 1793.4 states that when a 8 plaintiff prevails in an action brought under Cal. Civ. Code section 1793.2, the plaintiff 9 “shall be allowed by the court to recover as part of the judgment a sum equal to the 10 aggregate amount of costs and expenses, including attorney’s fees . . . .” (Emphasis 11 added). 12 Here, since Plaintiff’s first three causes of action allege violations of the Song- 13 Beverly Act, he will be entitled to recover his reasonable attorney's fees under section 14 1793.4 if he prevails. (See Complaint at ¶¶ 65 (“PLAINTIFF is entitled under the Act to 15 recover . . . actual attorney’s fees reasonably incurred in connection with the 16 commencement and prosecution of this action.”; 46; 54.) As such, the Court must 17 consider what attorney’s fees Plaintiff would likely be entitled to if he prevailed when 18 calculating the amount in controversy. 19 Defendant alleges in its Notice of Removal that attorney fees in similar Song- 20 Beverly Act cases “regularly approach or exceed $50,000.00.” (Notice of Removal at ¶ 21 19.) Indeed, Defendant attaches to its Notice of Removal (by way of the Kuhn 22 Declaration) a number of cases and court orders awarding plaintiffs roughly $50,000 or 23 more in Song-Beverly Act cases regarding single vehicles. (Kuhn Decl. Ex. C. (Bowser 24 v. Ford Motor Company, 78 Cal. App. 5th 587 (2022) (upholding trial court’s award of 25 $836,528.12 in attorney’s fees to Plaintiff in case over a single $43,084.68 vehicle)); 26 Kuhn Decl. Ex. B (Anderson v. Ford Motor Company, 74 Cal. App. 5th 946 (2022) 27 (upholding trial court’s award of $643,615.00 in attorney’s fees to Plaintiff in case over a 28 single $47,715.60 vehicle)); Kuhn Decl. Ex. A at 120 (Zargarian v. BMW of North 8 3:23-cv-1556-W-DDL 1 America, LLC, 442 F. Supp. 3d 1216 (C.D. Cal. 2020) (awarding Plaintiff $145,538.50 in 2 attorney’s fees in case over a single vehicle)); Kuhn Decl. Ex. A at 99 (Jurosky v BMW of 3 North America, LLC, (No. 19cv706 JM (BGS)) (S.D. Cal. August 25, 2020) (awarding 4 Plaintiff $106,703.00 in attorney’s fees in case over a single $61,298.40 vehicle)); Kuhn 5 Decl. Ex. A at 181 (Zomorodian v. BMW of North America, LLC, No. CV 17-5061-DMG 6 (C.D. Cal. July 23, 2019) (awarding Plaintiff $213,447.50 in attorney’s fees in case over 7 a single vehicle)); Kuhn Decl. Ex. A at 88 (Nisim v. Mercedes-Benz USA, LLC, No. 8 20STCV48243 (Los Angles Super. Ct., August 28, 2023) (awarding Plaintiff $43,169.00 9 in attorney’s fees in case over a single vehicle)); Kuhn Decl. Ex. A at 90 (Urquiza v. Ford 10 Motor Company, No. 20STCV16064 (Los Angles Super. Ct., June 3, 2022) (awarding 11 Plaintiff $82,000.00 in attorney’s fees in case over a single vehicle)).) 12 In estimating the amount of reasonable attorney’s fees Plaintiff would likely incur 13 (and thus be entitled to receive if he were to prevail) in this case, the Court may “rely on 14 ‘[its] own knowledge of customary rates and [the Court’s] experience concerning 15 reasonable and proper fees.’” Fritsch, 899 F.3d at 795 (quoting Ingram v. Oroudjian, 16 647 F.3d 925, 928 (9th Cir. 2011)). Given the Court’s own knowledge of customary 17 rates for Song-Beverly Act cases and experience concerning reasonable and proper 18 attorney’s fees in such cases; Defendant’s allegations that Plaintiffs attorney’s fees in this 19 case would likely be around or exceed $50,000.00 (along with supporting cases); and 20 Plaintiff’s lack of presenting any argument or evidence to the contrary; the Court finds 21 that Plaintiff’s likely recoverable attorney’s fees in this case (if successful)—when 22 combined with the actual damages at issue—would push Plaintiff’s recovery over 23 $75,000. 24 25 26 27 3. Civil Penalties While the damages at issue in this case plus Plaintiff’s potential attorney’s fees exceed $75,000, Defendant also argues the Court should include the Song-Beverly Act’s 28 9 3:23-cv-1556-W-DDL 1 civil penalty provision when calculating the amount in controversy requirement. (Notice 2 of Removal at ¶ 18.) 3 Cal. Civ. Code section 1794(d) states that “[i]f the buyer establishes that the failure 4 to comply was willful, the judgment may include . . . a civil penalty which shall not 5 exceed two times the number of actual damages.” (Emphasis added). There is a split 6 among district courts in the Ninth Circuit about when to include potential Song-Beverly 7 Act civil penalties when calculating the amount in controversy. E.g., Ferguson v. KIA 8 Motors Am. Inc., 2021 WL 1997550, at *3 (E.D. Cal. May 19, 2021) (collecting and 9 comparing cases in Southern and Central Districts of California and stating “[d]istrict 10 courts in the Ninth Circuit are split on whether to include Song-Beverly Act civil 11 penalties in calculations to assess the amount in controversy.”) In the past this Court— 12 like many others—has taken the position that civil penalties under the Song-Beverly Act 13 should not count towards the amount in controversy requirement where the complaint 14 merely requests civil penalties in the prayer for relief. Ronquillo v. BMW of N. Am., LLC, 15 2020 WL 6741317, at *2 (S.D. Cal. Nov. 17, 2020). Instead, there must actually be 16 allegations of willfulness in the complaint. E.g., id. at *3 (“Rather than assuming that 17 because a civil penalty is available, one will be awarded, the defendant must make some 18 effort to justify the assumption by, for example, pointing to allegations in the Complaint . 19 . . .”); Ferguson, 2021 WL 1997550, at *4 (holding that the court will only include the 20 Song-Beverly Act’s civil penalties in calculating the amount in controversy where 21 defendant points out where in the complaint “plaintiffs allege willfulness”); Villegas v. 22 Ford Motor Co., 2023 WL 3144540, at *10 (E.D. Cal. Apr. 28, 2023), report and 23 recommendation adopted, 2023 WL 4669863 (E.D. Cal. July 20, 2023) (“[w]here a 24 plaintiff properly alleges entitlement to the Act's civil penalty, which includes allegations 25 of the requisite willfulness by the defendant, up to two times the amount of actual 26 damages is put at issue whether or not that amount is ultimately awarded.”). 27 28 Here, the Complaint goes beyond merely requesting the Song-Beverly Act’s civil penalties in the prayer for relief. Instead, Plaintiff makes numerous allegations of willful 10 3:23-cv-1556-W-DDL 1 misconduct against Defendant in the body of the Complaint. (Complaint at ¶¶ 43 (“The 2 failure of [Defendant] to make the SUBJECT VECHICLE conform to the applicable 3 express warranties was willful . . . .”); 44 (“The failure of [Defendant] to replace the 4 SUBJECT VEHICLE or make restitution to PLAINTIFF was willful . . . .”); 45 (“The 5 failure of [Defendant] to refund the consideration paid . . . or to replace the SUBJECT 6 VEHICLE . . . was willful . . . .”); 69 (“[Defendant] willfully, falsely, and knowingly 7 marketed the subject vehicle as having a range capacity to reach 259-miles on a full 8 charge.”).) If such allegations of willfulness are proven true in this case, the Song- 9 Beverly Act’s civil penalty award of up to twice Plaintiff’s actual damages (~$38,467.00) 10 would be available—and thus could total as high as $76,934.00 in civil penalties alone. 11 This would more than exceed the required $75,000.00. 12 13 C. 14 Lastly, Plaintiff asserts in its Motion for Remand that “Defendant must 15 demonstrate that all of the requirements of 28 U.S.C. § 1446 are present, including 16 that (1) a notice of removal containing the required allegations was filed within the 17 time allowed, (2) all relevant parties have joined in the removal, and (3) Defendant 18 attached all of the relevant pleadings from the Superior Court to the notice of 19 removal.” (Motion for Remand at 11:13-18.) However, Plaintiff does not actually 20 argue that Defendant’s Notice of Removal fails to meet any of these requirements. 21 Thus, the Court does not interpret Plaintiff to be moving to remand on these 22 grounds. Especially where Defendant states that: (1) Defendant was served with 23 the Complaint on July 31, 2023 and then removed on August 22, 2023 (i.e. within 24 the required 30 days) (Opposition at ¶ 13:16-18; see Notice of Removal at ¶ 3); (2) 25 the only named defendant is the one who filed the Notice of Removal (see 28 26 U.S.C. § 1446(b)(1) (“all defendants who have been properly joined and served 27 must join in or consent to the removal of the action”); Tucker v. Royal Adhesives & 28 Sealants, LLC, 2023 WL 2666056, at *6 (C.D. Cal. Mar. 28, 2023) (citing Soliman Procedural Requirements 11 3:23-cv-1556-W-DDL 1 v. Philip Morris Inc., 311 F.3d 966, 966 (9th Cir. 2002)) (“[p]er its terms, 2 fictitiously named defendants are not to be considered when assessing the propriety 3 of removal jurisdiction based on diversity.”)); and (3) all the relevant state court 4 pleadings plainly are attached to the Notice of Removal (see generally Notice of 5 Removal at ¶ 4, Exs. A-B). 6 7 8 9 10 11 12 IV. CONCLUSION & ORDER Because Defendant has sufficiently established that the amount in controversy exceeds $75,000 and that there is complete diversity between the parties, the Court DENIES Plaintiff’s Motion [Doc. 10]. IT IS SO ORDERED. Dated: November 29, 2023 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 12 3:23-cv-1556-W-DDL
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