Bradix et al v. Advance Stores Company,Inc., No. 2:2016cv04902 - Document 21 (E.D. La. 2016)
Court Description: ORDER AND REASONS denying 20 Motion for Reconsideration. Signed by Judge Susie Morgan on 7/8/2016. (bwn)
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Bradix et al v. Advance Stores Company,Inc. Doc. 21 U N ITED S TATES D ISTRICT COU RT EASTERN D ISTRICT OF LOU ISIAN A W ALTER BRAD IX, IV, Pla in tiff CIVIL ACTION VERSU S N o . 16 -4 9 0 2 AD VAN CE STORES COMPAN Y, IN CORPORATED , D e fe n d an t SECTION "E"( 3 ) ORD ER AN D REAS ON S Before the Court is the Defendant Advance Stores Com pany, Incorporated’s m otion for reconsideration. 1 Defendant asks the Court to reconsider its decision to rem and the instant action upon a fin ding of no Article III standin g. 2 For the reason s stated below, the Court denies the m otion. I. Backgro u n d Plaintiff alleges that he is a form er em ployee of Defendant. 3 In March 20 16, Plaintiff alleges that Defendant was “duped” in an internet “phishing-type attack in which an outside party posin g as an [em ployee of Defendant] convinced an em ployee to provide a file containing inform ation about certain individuals who worked for [Defendant] during 20 15.”4 Plaintiff alleges the inform ation included em ployee nam es, 20 15 gross wages, social security num bers and the state in which the given em ployee pays incom e taxes. 5 Plaintiff alleges that his personal inform ation, along with the information of other em ployees, “can, and likely already has been used by the thieves, or third parties to whom 1 R. Doc. 20 . Id. 3 R. Doc. 1-1. 4 Id. at 3. 5 Id. 2 1 Dockets.Justia.com such inform ation is transferred and/ or sold, to file tax returns, open revolving credit accounts, purchase vehicles and even apply for and procure a job.”6 Plaintiff alleges that he “has noticed two as-yet unidentified inquiries on his consum er credit report, both were attem pts to secure vehicle financing.”7Plaintiff alleges that Defendant has attem pted to rem edy the data breach by offering affected em ployees twenty-four m onths of credit m onitoring services, but asserts that m onitoring is “woefully inadequate” and that affected em ployees like Plaintiff will have to spend “significant resources both in tim e an d financial, to correct the inevitable breaches into their personal credit histories.”8 On April 15, 20 16, Plaintiff filed the instant “Class Action Petition and Dem and for J ury Trial” in the Civil District Court for the Parish of Orleans. 9 The petition alleges that Defendant’s conduct with regards to the phishing-type attack constituted negligence, gross negligence, a breach of Defendant’s fiduciary duty, and an invasion of privacy under Louisiana law. 10 In the petition, Plaintiff asserts that the class he seeks to represent “could theoretically be 75,0 0 0 strong.”11 On May 10 , 20 16, Defendant rem oved the action to this Court, asserting that rem oval was proper and that the Court has federal subject m atter jurisdiction under the Class Action Fairness Act (“CAFA”). 12 On J une 7, 20 16, Defendant filed the instant m otion to dism iss. 13 Notably, Defendant argued in the m otion that the Court lacks subject-m atter jurisdiction under Rule 12(1). 6 Id. Id. at 4. 8 Id. 9 See generally R. Doc. 1-1. 10 Id. 11 Id. at 2. 12 R. Doc. 1. 13 R. Doc. 8. 7 2 In its ruling on Defendant’s m otion to dism iss, the Court agreed with Defendant that the Court lacked Article III standing. 14 However, the Court did not agree that dism issal was the appropriate rem edy and instead ordered that the case be rem anded to state court. 15 The Court found that Defendant’s rem oval of the action was im proper and that 28 U.S.C. § 1447(c) requires a district court lacking subject m atter jurisdiction over a rem oved action to rem and, rather than dism iss. 16 II. D e fe n d an t’s Argu m e n t Defendant argues that dism issal, rather than rem and is appropriate in this case, because rem and would be futile. 17 Defendant argues that the Fifth Circuit has em braced the “futility doctrine,” which allows a district court to dism iss a rem oved action for lack of jurisdiction when it is clear that the court to which the case would be rem anded would likewise have to dism iss the action. 18 Defendant asserts that a Louisiana court would lack standing for all the reasons a federal district court lacks standing, contending that Louisiana courts m ay only preside over cases involving “‘actual present or im m ediately threatened injury’ and m ore than a ‘hypothetical threat.’”19 Defendant argues that Louisiana courts determ ining justiciability issues rely on federal jurisprudence and apply federal law regarding speculative harm . 20 As such, Defendant argues that rem and would be futile, because a Louisiana Court cannot exercise jurisdiction over the instant case any m ore than the Court can. 21 14 R. Doc. 18 . Id. 16 Id. 17 R. Doc. 20 -1. 18 Id. 19 Id. (quotin g State v. Rochon, 20 11-0 0 0 9 (La. 10 / 25/ 11); 75 So.3d 876, 8 8 2). 20 Id. 21 Id. 15 3 III. An a lys is For a num ber of reason s, the Court is not persuaded by Defendant’s argum ent that the futility doctrine m ay properly be em ployed in this case. As an initial m atter, the Court finds that Defendant urges an overbroad understanding of the futility doctrine. Furtherm ore, to the extent the futility doctrine could apply to this case, the Court is not persuaded that the Court’s determ ination that Plaintiff lacks Article III standing m akes it sufficiently certain that a Louisiana court would have to dism iss the instant case upon rem and. For its advocated understanding of the futility doctrine, Defendant relies principally on the Fifth Circuit’s decisions in Asarco v. Glenara, 912 F.2d 784 (5th Cir. 1990 ), and Underhill v. Porter, 35 F.3d 560 , 1994 WL 499742 (5th Cir. 1994) (per curiam and not selected for publication). In Asarco, the Fifth Circuit determ ined that courts in Louisiana could not exercise personal jurisdiction over the defendants in the case and found that it therefore would be futile to rem and the rem oved action to state court, given that a Louisiana court “would be bound by [the Asarco court’s] ruling that defendants had insufficient contacts with Louisiana to satisfy the federal due process clause requisites for personal jurisdiction. See 912 F.2d at 78 7. In Underhill v. Porter, which Defendant fails to m ention was a per curiam decision not selected for publication, 22 the Fifth Circuit ruled that a taxpayer suit against an IRS agent could not go forward, because the federal governm ent had not waived its sovereign im m unity. See 1994 WL 499742 at *1– *2. The Underhill court found rem and 22 R. Doc. 20 -1 at 3. 4 inappropriate, because its finding regarding the federal governm ent's sovereign im m unity would apply the sam e to both federal and state courts. Id. Although Defendant does m ake reference to it at the end of a lengthy footnote, 23 Defendant fails to give proper weight to the Suprem e Court’s discussion of the futility doctrine in International Prim ate Protection League v. Tulane Educational Fund, 50 0 U.S. 72 (1991). Facing distinguishable jurisdictional issues, the Court in Prim ate Protection League nonetheless provided im portant insight on the standard for applying the futility doctrine and cited with favor the reasoning of a First Circuit decision that did address the futility doctrine in the context of a federal court lacking Article III standing. See 50 0 U.S. at 74– 76, 88 – 89 (discussing Me. Ass'n of Interdependent N eighborhoods v. Com m 'n, Me. Dept. of Hum an Serv., 8 76 F.2d 10 51 (1st Cir. 1989) (hereinafter “M.A.I.N .”)). The Court in Prim ate Protection League clearly indicated that dism issal of a rem oved case, rather than rem and, is only appropriate when it is “sufficiently certain” that rem and would be futile. Id. at 88. Quoting the First Circuit’s decision in M.A.I.N ., the Court noted the “the literal words of [28 U.S.C.] § 1447(c), which, on their face, give no discretion to dism iss rather than rem and an action” Id. at 8 9 (internal abbreviation om itted). 24 The Prim ate Protection League Court discussed with favor the M.A.I.N. court’s decision not to em ploy the futility doctrine where “plaintiff’s lack of Article III standing would not necessarily defeat its standing in state court.” See id. at 8 8 – 89. 23 See R. Doc. 20 -1 at 3 n .2. As the Court noted in its Order and Reasons on Defen dant’s m otion to dism iss, 28 U.S.C. § 1447(c) is clear that “[i]f at any tim e before final judgm ent it appears that the district court lacks subject m atter jurisdiction , the case shall be rem anded.” See also 28 U.S.C. § 1453(c)(1) (barrin g an exception for certain securities, 28 U.S.C. § 1447 applies to any rem oval of a class action); W allace v. ConAgra Foods, Inc., 747 F.3d 10 25, 10 33 (8th Cir. 20 14) (upon finding of no standing, where “the case did not originate in federal court but was rem oved there by the defendants, the federal court m ust rem and the case to the state court form whence it cam e”). 24 5 From this binding precedent, the Court concludes that dism issal rather than rem and would only be appropriate if the Court determ in es that Plaintiff’s lack of Article III standing would necessarily defeat Plaintiff’s standing to bring suit in state court. Defendant has failed to dem onstrate that a Louisiana court would necessarily dism iss the instant action for lack of standing. While Louisiana Suprem e Court decisions have previously referenced Article III standing and actual injury principles in crafting a Louisiana doctrine on justiciability, the Court is aware of no state constitutional provision or Louisiana Suprem e Court decision firm ly establishing that Louisiana necessarily follows Suprem e Court precedent on Article III standing. Cf. Rochon, 75 So.3d at 882 (citing Suprem e Court decisions in discussion of “ripeness” requirem ent); La. Fed. Of Teachers v. State, 20 11-2226 (La. 7/ 2/ 12); 94 So.2d 760 , 763– 64 (discussing federal “guidance” on justiciability issues). Without unam biguous state law authority, the Court would have to venture an Erie guess 25 to conclude that Plaintiff’s lack of Article III standing in this case necessarily m eans he would not have standing in state court. District courts only m ake Erie guesses when properly exercising subject m atter jurisdiction over substantive state law m atters. Because this Court lacks subject m atter jurisdiction, following the Suprem e Court’s discussion of the futility doctrine in Prim ate Protection League, and in light of the plain language of 28 U.S.C. § 1447(c), the Court cannot conclude that the futility doctrine applies in this case. The case shall be rem anded to state court and it will be left to the state court to determ ine whether or not Plaintiff has standing to proceed with his suit there. 25 See e.g., How e ex rel. How e v. Scottsdale Ins. Co., 20 4 F.3d 624, 627 (5th Cir. 20 0 0 ). 6 Accordingly, IT IS ORD ERED that Defendant’s m otion for reconsideration 26 is D EN IED . N e w Orle an s , Lo u is ian a, th is 8 th d ay o f Ju ly, 2 0 16 . ____________________ ________ SU SIE MORGAN U N ITED S TATES D ISTRICT J U D GE 26 R. Doc. 20 . 7
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