Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_18-cv-01992/USCOURTS-casd-3_18-cv-01992-0/pdf.json

Nature of Suit Code: 195
Nature of Suit: Contract Product Liability
Cause of Action: 28:1441ml Removal- Motor Vehicle Prod Liability

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

GEOFFREY MARK LESS,

Plaintiff,

v.

FORD MOTOR COMPANY and KEN 

GRODY FORD CARLSBAD,

Defendants.

Case No.: 18cv1992-MMA (AGS)

ORDER REMANDING CASE TO 

STATE COURT

On July 26, 2018, Plaintiff Geoffrey Mark Less (“Plaintiff”) filed a Complaint in 

the Superior Court of the State of California for the County of San Diego against 

Defendants Ford Motor Company (“Ford”) and Ken Grody Ford Carlsbad (“Ken 

Grody”). Doc. No. 1-2 (“Compl.”). Plaintiff alleges six claims against Ford and one 

claim against Ken Grody under California’s Song-Beverly Consumer Warranty Act 

(“Song-Beverly Act”). Id. As against Ford, Plaintiff alleges violations of California 

Civil Code § 1793.2(a)(3), (b), and (d), breach of express written warranty pursuant to 

California Civil Code § 1791.2(a) and § 1794, breach of the implied warranty of 

merchantability pursuant to California Civil Code § 1791.1 and § 1794, and fraud by 

omission. Id. Plaintiff alleges the implied warranty claim against Ken Grody as well. 

Compl., ¶¶ 28-32.

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On August 27, 2018, Ford removed this action to this Court on the basis of 

diversity jurisdiction. Doc. No. 1. Upon review of the notice of removal and the 

Complaint, the Court questioned whether Ford had sufficiently demonstrated complete 

diversity. See Doc. No. 3 at 1-2; see Owen Equipment & Erection Co. v. Kroger, 437 

U.S. 365, 373 (1978) (“[D]iversity jurisdiction does not exist unless each defendant is a 

citizen of a different State from each plaintiff.”). According to the Complaint, Plaintiff is 

a citizen of the State of California, Ford is a Delaware corporation, and Ken Grody is a 

California Corporation. Compl., ¶¶ 2, 4-5. Therefore, the Court ordered Ford to show 

cause why the case should not be remanded for lack of subject matter jurisdiction. Doc. 

No. 3. Ford filed a response to the Court’s Order on September 14, 2018. Doc. No. 4.

LEGAL STANDARD

“[A]ny civil action brought in a State court of which the district courts of the 

United States have original jurisdiction, may be removed by the defendant or the 

defendants, to the district court of the United States for the district and division 

embracing the place where such action is pending.” 28 U.S.C. § 1441(a). “To remove a 

case from state court to federal court, a defendant must file in the federal forum a notice 

of removal ‘containing a short and plain statement of the grounds for removal.’” Dart 

Cherokee Basin Operating Co., LLC v. Owens, 135 S.Ct. 547, 551 (2014) (quoting 28 

U.S.C. § 1446(a)). Removal of a case depends, in part, upon whether the claims fall 

within the district court’s subject matter jurisdiction. Boydston v. Asset Acceptance LLC, 

496 F. Supp. 2d 1101, 1103-04 (N.D. Cal. 2007). “Federal courts are courts of limited 

jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). As 

such, “[a] federal court is presumed to lack jurisdiction in a particular case unless the 

contrary affirmatively appears.” Stock West, Inc. v. Confederated Tribes of Colville 

Reservation, 873 F.2d 1221, 1225 (9th Cir. 1989) (citation omitted). “The strong 

presumption against removal jurisdiction means that the defendant always has the burden 

of establishing that removal is proper.” Gaus v. Miles, Inc. 980 F.2d 564, 566 (9th Cir. 

1992) (quotation marks omitted). “If at any time before final judgment it appears that the 

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district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 

1447(c); see Fed. R. Civ. P. 12(h)(3) (“If the court determines at any time that it lacks 

subject-matter jurisdiction, the court must dismiss the action.”).

Civil actions not arising under the Constitution, laws, or treaties of the United 

States are removable to a federal district court only if there is diversity of citizenship 

between the parties. See 28 U.S.C. §1331 (providing that “[t]he district courts shall have 

original jurisdiction of all civil actions arising under the Constitution, laws or treaties of 

the United States”); see also 28 U.S.C. § 1332(a)(1) (providing that district courts have 

subject matter jurisdiction if there is diversity jurisdiction). Section 1332 requires that 

there be complete diversity, meaning each plaintiff’s citizenship must be diverse as to 

each defendant’s citizenship, and the amount in controversy exceeds the sum or value of 

$75,000. 28 U.S.C. § 1332(a)(1); Owen Equipment & Erection Co., 437 U.S. at 373. A 

defendant may remove a civil action that alleges claims against a non-diverse defendant 

where the plaintiff has no basis for suing that defendant. McCabe v. General Foods 

Corp., 811 F.2d 1336, 1339 (9th Cir. 1987).

Where a non-diverse defendant has been “fraudulently joined” to an otherwise 

completely diverse case, that non-diverse defendant’s citizenship is disregarded for 

diversity jurisdiction purposes. United Computer Sys., Inc. v. AT&T Corp., 298 F.3d 756, 

761 (9th Cir. 2002) (citations omitted). However, there is a “general presumption against 

fraudulent joinder.” Hunter v. Philip Morris USA, 582 F.3d 1039, 1046 (9th Cir. 2009) 

(citation omitted). “A defendant is fraudulently joined when [a] ‘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.’” Kwasniewski v. Sanofi-Aventis U.S., LLC, 637 Fed. App’x 

406, 406 (9th Cir. 2016) (quoting McCabe, 811 F.2d at 1339); see also Nasrawi v. Buck 

Consultants, LLC, 776 F. Supp. 2d 1166, 1169-70 (E.D. Cal. 2011) (“[A] non-diverse 

defendant is deemed a sham defendant if, after all disputed questions of fact and all 

ambiguities in the controlling state law are resolved in the plaintiff’s favor, the plaintiff 

could not possibly recover against the party whose joinder is questioned.”). The 

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removing defendant bears the heavy burden of proving fraudulent joinder by clear and 

convincing evidence. See GranCare, LLC v. Thrower, 889 F.3d 543, 548 (9th Cir. 2018) 

(citing Hunter, 582 F.3d at 1046); see also Hamilton Materials, Inc. v. Dow Chem. Corp., 

494 F.3d 1203, 1206 (9th Cir. 2007) (“Fraudulent joinder must be proven by clear and 

convincing evidence.”).

DISCUSSION

Ford has fallen short of carrying its heavy burden of proof to show that removal 

was proper because it has not demonstrated that Ken Grody was fraudulently joined. In 

its notice of removal, Ford argues that “there is no viable cause of action that is pleaded 

in the Complaint that is directed to [Ken Grody].” Doc. No. 1 at 6. Ford’s allegation is 

insufficient to establish that Ken Grody cannot be liable on any theory. 

Plaintiff alleges a breach of implied warranty claim against Ken Grody, which is a 

dealership. Compl., ¶¶ 28-32. Numerous courts have found implied warranty claims 

against dealerships to be valid, and the dealerships to be necessary parties, in connection 

with claims under the Song-Beverly Act. See, e.g., Cavale v. Ford Motor Co., No. 1:18-

cv-00680-LJO-BAM, 2018 WL 3811727, at *4 (E.D. Cal., Aug. 9, 2018); Chipley v. 

Ford Motor Co., No. 18-cv-01161-YGR, 2018 WL 1965029, at *2 (N.D. Cal. Apr. 26, 

2018); Blowers v. Ford Motor Co., No. CV 17-8224-JFW (KSX), 2018 WL 654415, at 

*4 (C.D. Cal. Jan. 31, 2018); Sandhu v. Volvo Cars of N. Am., LLC, No. 16-CV-04987-

BLF, 2017 WL 403495, at *4 (N.D. Cal. Jan. 31, 2017); Delafontaine v. Volvo Cars of N. 

Am., LLC, No. CV 16-07154-GHK (SKx), 2016 WL 7338404, at *2-3 (C.D. Cal. Dec. 

19, 2016). As a result, the allegations in Ford’s notice of removal offer no legitimate 

reason to disregard Ken Grody’s citizenship for purposes of removal.

In its response to this Court’s Order, Ford contends that Ken Grody cannot be 

liable on any theory because the implied warranty claim against it is time-barred. Doc. 

No. 4 at 3-4. As Ford points out, the statute of limitations can be a basis for finding that a 

defendant has been fraudulently joined. See Ritchey v. Upjohn Drug Co., 139 F.3d 1313, 

1320 (9th Cir. 1998) (holding that non-diverse defendants were fraudulently joined where 

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the statute of limitations barred the cause of action against them); Hamilton Materials, 

Inc., 494 F.3d at 1206 (same). Under the Song-Beverly Act, the implied warranty of 

merchantability extends for a period of one year after delivery, and the time for bringing 

an action is four years from the breach. Mexia v. Rinker Boat Co., 174 Cal. App. 4th 

1297, 1306-09 (Ct. App. 2009). A claim for breach of the implied warranty of 

merchantability may be based upon a defect not discoverable at the time of sale. See 

Ehrlich v. BMW of N. Am., LLC, 801 F. Supp. 2d 908, 922 (C.D. Cal. 2010); see also 

Keegan v. Am. Honda Motor Co., 838 F. Supp. 2d 929, 948 (C.D. Cal. 2012); Daniel v. 

Ford Motor Co., 806 F.3d 1217, 1223 (9th Cir. 2015). Further, the statute of limitations 

on a claim for breach of implied warranty may be tolled. See Cavale, 2018 WL 3811727, 

at *3; Chipley, 2018 WL 1965029, at *3 Jimenez v. Ford Motor Co., No. CV 18-3558-

JFW (ASx), 2018 WL 2734848, at *2 (C.D. Cal. June 5, 2018); Philips v. Ford Motor 

Co., No. 14-CV-02989-LHK, 2016 WL 1745948, at *13-14 (N.D. Cal. May 3, 2016).

Here, Plaintiff alleges he purchased his Ford vehicle in November of 2007, but that 

the statute of limitations applicable to his claims has been tolled under several theories: 

(1) equitable tolling; (2) the discovery rule; (3) fraudulent concealment; (4) equitable 

estoppel; (5) the repair rule; and/or (6) class action tolling. Compl., ¶¶ 7, 73. Notably, 

Ford does not address Plaintiff’s tolling allegations. Doc. No. 4. Rather, Ford asserts 

that because there is a statute of limitations that has run, Plaintiff’s claim against Ken 

Grody is time-barred without referencing tolling. Id. at 3-4. 

The Court finds that it is possible that at least one, if not more, of these tolling 

doctrines applies and that Plaintiff’s claim against Ken Grody is not time-barred. See 

Cavale, 2018 WL 3811727, at *3; Chipley, 2018 WL 1965029, at *3 Jimenez, 2018 WL 

2734848, at *2; Philips, 2016 WL 1745948, at *13-14. The standard for demonstrating 

fraudulent joinder is high, and the relevant question is whether it is possible for Plaintiff 

to state a claim against Ken Grody, not whether it has been sufficiently pleaded. See 

Diaz v. Allstate Ins. Grp., 185 F.R.D. 581, 586 (C.D. Cal. 1998) (“[M]erely showing that 

an action is likely to be dismissed against that defendant does not demonstrate fraudulent 

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joinder. ‘The standard is not whether plaintiffs will actually or even probably prevail on 

the merits, but whether there is a possibility that they may do so.’”) (citation omitted). 

As a result, the Court concludes that it is not obvious that Plaintiff cannot state a claim 

against Ken Grody, because it is possible that the statute of limitations on the breach of 

the implied warranty of merchantability claim may be tolled. Even if the allegations 

concerning tolling are not sufficiently pleaded, Ford has not shown that Plaintiff would 

be unable to amend his complaint to allege a viable tolling theory. See Cavale, 2018 WL 

3811727, at *3; Jimenez, 2018 WL 2734848, at *2 (stating that “although Ford argues 

that Plaintiff has not pled sufficient facts to demonstrate that the statute of limitations is 

tolled as to her claim against United Brothers, the Court cannot conclude that Plaintiff 

has no possibility of ultimately stating her claim for breach of implied warranty of 

merchantability”). Thus, Ford has not shown that there is absolutely no possibility that 

Plaintiff cannot state a claim against Ken Grody and, therefore, has not met its burden in 

showing that Ken Grody has been fraudulently joined. See Diaz, 185 F.R.D. at 586. 

CONCLUSION

Based on the foregoing, the Court is not satisfied that it has subject matter 

jurisdiction over this action. Accordingly, the Court REMANDS this case to the 

Superior Court for the State of California, County of San Diego for lack of federal subject 

matter jurisdiction. See 28 U.S.C. § 1447(c) (“If at any time before final judgment it 

appears that the district court lacks subject matter jurisdiction, the case shall be 

remanded.”). The Clerk of Court is instructed to close this case.

IT IS SO ORDERED.

Dated: September 18, 2018

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