Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_19-cv-00151/USCOURTS-casd-3_19-cv-00151-0/pdf.json

Nature of Suit Code: 195
Nature of Suit: Contract Product Liability
Cause of Action: 

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

CRUZ CASTILLO,

Plaintiff,

v.

FCA USA, LLC,

Defendant.

Case No.: 19-CV-151-CAB-MDD

ORDER REMANDING ACTION TO 

THE SUPERIOR COURT OF THE 

STATE OF CALIFORNIA, COUNTY 

OF SAN DIEGO

[Doc. No. 1]

This matter comes before the Court following a review of Defendant FCA US, 

LLC’s Notice of Removal to the United States District Court for the Southern District of 

California. [Doc. No. 1.] On January 23, 2019, Defendant removed this action from the 

Superior Court of the State of California, County of San Diego claiming complete diversity 

and, “the matter in controversy exceeds the sum or value of $75,000, exclusive of interest 

and costs, as required for removal.” [Id. at ¶ 15.]

Although Plaintiff Cruz Castillo did not file a motion to remand, “[t]he court may—

indeed must—remand an action sua sponte if it determines that it lacks subject matter 

jurisdiction.” GFD, LLC v. Carter, No. CV 12-08985 MMM FFMX, 2012 WL 5830079, 

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at *2 (C.D. Cal. Nov. 15, 2012) (citing Kelton Arms Condominium Owners Ass’n v. 

Homestead Ins. Co., 346 F.3d 1190, 1192 (9th Cir. 2003)); see also 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.”).

“Federal courts are courts of limited jurisdiction. They possess only that power 

authorized by Constitution and statute.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 

U.S. 375, 377 (1994). Consequently, it is “presume[d] that federal courts lack jurisdiction 

unless the contrary appears affirmatively from the record.” DaimlerChrysler Corp. v. 

Cuno, 547 U.S. 332, 342 (2006) (quoting Renne v. Geary, 501 U.S. 312, 316 (1991)). “The 

right of removal is entirely a creature of statute and a suit commenced in a state court must 

remain there until cause is shown for its transfer under some act of Congress.” Syngenta 

Crop Protection, Inc. v. Henson, 537 U.S. 28, 32 (2002). The party invoking the removal 

statute bears the burden of establishing that federal subject-matter jurisdiction exists. 

Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir. 1988). Moreover, courts 

“strictly construe the removal statute against removal jurisdiction.” Gaus v. Miles, Inc., 

980 F.2d 564, 566 (9th Cir. 1992) (citing Boggs v. Lewis, 863 F.2d 662, 663 (9th Cir. 

1988)); Takeda v. Nw. Nat’l Life Ins. Co., 765 F.2d 815, 818 (9th Cir. 1985)). Therefore, 

“[f]ederal jurisdiction must be rejected if there is any doubt as to the right of removal in 

the first instance.” Gaus, 980 F.2d at 566 (citing Libhart v. Santa Monica Dairy Co., 592 

F.2d 1062, 1064 (9th Cir. 1979)).

Federal courts have diversity jurisdiction “where the amount in controversy” 

exceeds $75,000, and the parties are of “diverse” state citizenship. 28 U.S.C. § 1332. 

“Where it is not facially evident from the complaint that more than $75,000 is in 

controversy, the removing party must prove, by a preponderance of the evidence, that the 

amount in controversy meets the jurisdictional threshold.” Matheson v. Progressive 

Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003) (per curiam); accord Valdez v. 

Allstate Ins. Co., 372 F.3d 1115, 1117 (9th Cir. 2004) (quoting Matheson, 319 F.3d at 

1090). “Where doubt regarding the right to removal exists, a case should be remanded to 

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state court.” Matheson, 319 F.3d at 1090.

Here, the underlying Complaint indicates that, “[o]n March 10, 2015, Plaintiff 

purchased a used 2011 Chrysler 300.” [Doc. No. 1-2 at ¶ 8.] Plaintiff alleges that he “is 

entitled to reimbursement of the price paid for the vehicle less that amount directly 

attributable to use by the Plaintiff prior to discovery of the nonconformities” as well as “all 

incidental, consequential, and general damages resulting from Defendant’s failure to 

comply with its obligations under the Song-Beverly Act.” [Id. at ¶¶ 26-27.] Plaintiff also 

alleges he is entitled to “a civil penalty of up to two times the amount of actual damages 

for FCA US LLC’s willful failure to comply with its responsibilities under the Act.” [Id. 

at ¶ 29.] Because it is not facially evident from the Complaint that the amount in 

controversy exceeds $75,000, it is Defendant’s burden to prove, by a preponderance of the 

evidence, that the amount in controversy exceeds the $75,000 jurisdictional threshold. See 

Matheson, 319 F.3d at 1090. 

Defendant’s Notice of Removal contends that Plaintiff’s actual damages, based on 

the price paid for the vehicle less that amount directly attributable to use by the Plaintiff, 

is $26,131.31. [Doc. No. 1 at 15.] Defendant then states that by virtue of the civil penalty 

that Plaintiff also seeks (two times the “actual damages”), the total amount of damages 

sought by Plaintiff is approximately $78,393.81, plus attorneys’ fees. Therefore, 

Defendant contends the matter in controversy exceeds the sum or value of $75,000, 

exclusive of interest and costs, as required for removal. [Id.]

The civil penalty under California Civil Code § 1794(c) cannot simply be assumed. 

See Herko v. FCA US, LLC, No. 19-CV-2057 JLS (WVG), 2019 WL 5587140, at *2 (S.D. 

Cal. Oct. 30, 2019). While courts frequently treat this penalty as a form of punitive 

damages that may be appropriately included in an amount-in-controversy calculation, 

Defendant has made no showing that such a civil penalty is more likely than not to be 

awarded here. In Zawaideh v. BMW of North America, the court considered jurisdiction 

over a claim analogous to the one here and found that the amount in controversy had not 

been adequately proved. No. 17-cv-2151 W (KSC), 2018 WL 1805103, at *2 (S.D. Cal. 

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Apr. 17, 2018). Evaluating the civil penalty provision at issue here, the court reasoned that 

instead of simply assuming a penalty will be awarded, “the defendant must make some 

effort to justify the assumption by, for example, pointing to allegations in the Complaint 

suggesting award of a civil penalty would be appropriate, and providing evidence—such 

as verdicts or judgments from similar cases—regarding the likely amount of the penalty.” 

Id. (collecting cases). Where the defendant failed to identify allegations justifying such an 

award and failed to submit evidence of civil penalties awarded in analogous cases, the court 

found the defendant failed to establish that the amount in controversy should include the 

civil penalty. Id. at *3.

The Court reaches the same conclusion here. Simply assuming a civil penalty award 

is inconsistent with the principle that the defendant “must provide evidence that it is ‘more 

likely than not’ that the amount in controversy” requirement is satisfied. Sanchez v. 

Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir.1996). Absent any specific argument 

or evidence for its inclusion, the Court will exclude the civil penalty under California Civil 

Code § 1794(c) from its amount-in-controversy calculation.

Defendant also appears to contend that attorneys’ fees should be included in the 

amount in controversy calculation. [Doc. No. 1 at ¶ 15.] It is true that “attorneys’ fees can 

be taken into account in determining the amount in controversy if a statute [or contract] 

authorizes fees to a successful litigant.” Galt G/S v. JSS Scandinavia, 142 F.3d 1150, 1155 

(9th Cir. 1998) (quoting Goldberg v. CPC Int’l Inc., 678 F.2d 1365, 1367 (9th Cir. 1992), 

cert. denied, 459 U.S. 945 (1982)). But “Defendant does not make any effort to set forth 

the value of attorney’s fees that it expects [P]laintiff[] will incur in this matter.” Johnson 

v. Am. Online, Inc., 280 F. Supp. 2d 1018, 1026 (N.D. Cal. 2003). Furthermore, without 

the inclusion of any civil penalty award into the calculation, the inclusion of a potential 

attorneys’ fees award would likely still fail to satisfy the jurisdictional limit. Consequently, 

“[w]hile it may well be true that [Plaintiff’s] claim . . . will ultimately exceed $75,000, 

[D]efendant has not met its burden to demonstrate this fact by a preponderance of the 

evidence.” See Johnson, 280 F. Supp. 2d at 1026; see also Zawaideh, 2018 WL 1805103, 

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at *3. Accordingly, this case is REMANDED to the San Diego County Superior Court.

It is SO ORDERED.

Dated: December 5, 2019

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