Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_17-cv-02151/USCOURTS-casd-3_17-cv-02151-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

FAHED ISMAT ZAWAIDEH,

Plaintiff,

v.

BMW OF NORTH AMERICA, LLC,

Defendant.

Case No.: 17-CV-2151 W (KSC) 

ORDER GRANTING MOTION 

TO REMAND [DOC. 5]

Pending before the Court is Plaintiff Fahed Ismat Zawaideh’s motion to remand 

this case to the San Diego Superior Court. Defendant opposes.

The Court takes the matter under submission and without oral argument. See Civ. 

R. 7.1(d)(1). For the following reasons, the Court GRANTS the motion [Doc. 5] and 

ORDERS the case remanded.

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I. RELEVANT BACKGROUND

This case arises from Plaintiff Fahed Ismat Zawaideh’s lease of a 2016 BMW 740I 

from BMW of El Cajon. (Compl. ¶ 6.1

) According to Plaintiff, the vehicle was covered 

by an express warranty, by which Defendant BMW of North America, LLC “undertook 

to preserve or maintain the utility or performance of Plaintiff’s Vehicle or provide 

compensation if there was a failure in such utility or performance.” (Id.) The Complaint 

alleges, however, that the “Vehicle was delivered to Plaintiff with serious defects and 

nonconformities to warranty and developed other serious defects and nonconformities to 

warranty.” (Id. ¶ 7.)

On September 18, 2017, Plaintiff filed a lawsuit against Defendant in the San 

Diego Superior Court. The Complaint asserts a single cause of action for Violation of the 

Song-Beverly Consumer Warranty Act, Civil Code § 1750 et seq., and seeks, among 

other things, general damages, rescission of the sale contract, incidental and 

consequential damages, a civil penalty of two times Plaintiff’s actual damages, and 

reasonable attorney’s fees and costs. (Compl. ¶ 9 and Prayer ¶¶ 1–6.)

On October 19, 2017, Defendant removed the case to this Court based on diversity 

jurisdiction. Plaintiff now moves to remand the case.

II. LEGAL STANDARD

“Federal courts are courts of limited jurisdiction.” Kokkonen v. Guardian Life Ins. 

Co. of Am., 511 U.S. 375, 377 (1994). “They possess only that power authorized by 

Constitution or a statute, which is not to be expanded by judicial decree.” Id. (internal 

citations omitted). “It is to be presumed that a cause lies outside this limited jurisdiction 

and the burden of establishing the contrary rests upon the party asserting jurisdiction.” 

Id. (internal citations omitted).

 

1 The Complaint is attached to the Notice of Removal [Doc. 1] as Exhibit A [Doc. 1-2].

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Consistent with the limited jurisdiction of federal courts, the removal statute is 

strictly construed against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 

(9th Cir. 1992). “The strong presumption against removal jurisdiction means that the 

defendant always has the burden of establishing that removal is proper.” Id. “Federal 

jurisdiction must be rejected if there is any doubt as to the right of removal in the first 

instance.” Id.

III. DISCUSSION

Plaintiff argues the case must be remanded because Defendant cannot establish that 

the amount in controversy exceeds $75,000. (Mot. to Remand [Doc. 5] 5:16–9:1.) 

Defendant contends this amount is satisfied by adding the amounts for restitution, 

consequential and incidental damages, civil penalties, and reasonable attorney’s fees. 

(Opp’n [Doc. 5] 1:6–9.)

To determine whether the amount in controversy has been met on removal, “[t]he 

district court may consider whether it is ‘facially apparent’ from the complaint that the 

jurisdictional amount is in controversy.” Singer v. State Farm Mutual Auto Ins. Co., 116 

F.3d 373, 377 (9th Cir. 1997). Where the state-court complaint does not specify an exact 

damage figure, the defendant “must provide evidence that it is ‘more likely than not’ that 

the amount in controversy” satisfies the federal diversity-jurisdiction requirement. 

Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996).

Here, the Complaint does not specify a damage figure. Accordingly, Defendant

bears the burden of providing evidence supporting the contention that the amount in 

controversy exceeds $75,000. With respect to restitution, the parties appear to agree that 

under the Song-Beverly Act, the amount at issue is $14,470. (Opp’n 2:4–3:5; Reply

[Doc. 6] 1:26–27.) They also agree that Plaintiff’s consequential and incidental damages, 

consisting of rescission of the lease agreement, total $22,398.75. (Opp’n 4:9–16; Reply

1:21–22.) Thus, the parties agree that restitution, and consequential and incidental 

damages amount to $36,868. The parties disagree on whether Defendant has provided 

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evidence supporting its contention that the amount in controversy should include roughly 

$39,000 in civil penalties and attorney’s fees. The Court will evaluate the two categories 

separately.

A. Civil Penalty 

Defendant argues that the amount in controversy should include a civil penalty of 

$28,940. (Opp’n 3:6–4:6.) This consists of Plaintiff’s request for a civil penalty in the 

amount of two times his actual damages under the Song-Beverly Act. (Id. 3:12–14.) In 

support of this argument, Defendant relies on Brady v. Mercedes-Benz USA, Inc., 243 

F.Supp.2d 1004 (N.D. Cal. 2002). (Id. 3:7–14.) 

In Brady, in evaluating whether the amount in controversy requirement was met, 

the court doubled the amount of restitutionary damages in order to calculate the civil 

penalty at issue. Id. at 1009. The decision, however, does not appear based on any

attempt to determine whether the facts justified the assumption that plaintiff would be 

awarded a civil penalty, or any showing by defendant regarding the expected or average 

civil penalty awarded in analogous cases. Instead, Brady appears to have simply 

assumed a civil penalty would be awarded.

In contrast to Brady, Plaintiff cites several cases that required defendants to 

demonstrate that including an estimate of punitive damages in the amount-in-controversy 

requirement would be reasonable.2

 In Conrad Associates v. Hartford Accident & 

Indemnity Company, 994 F.Supp. 1196 (N.D. Cal. 1998), an insurance company 

defendant in a bad-faith case sought to include punitive damages in order to meet the 

 

2 The Court finds cases evaluating whether to include punitive damages in calculating the amount in 

controversy requirement are helpful in evaluating whether to include a penalty under the Song-Beverly 

Act. See Brady, 243 F.Supp.2d at 1009 (In evaluating the penalty to include in the amount-incontroversy calculation, court acknowledged that “[c]ourts have held that the civil penalty under the 

Song-Beverly Act is akin to punitive damages, because both have the dual effect of punishment and 

deterrence. [Citations omitted.]”)

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amount-in-controversy requirement. In support of its argument, defendant attached a 

number of jury verdicts awarding punitive damages, and asserted that the average amount 

of those verdicts should be used in calculating the amount in controversy. 

Conrad rejected defendant’s argument because, the “defendant made no effort to 

compare the facts of those cases with the alleged facts of this case.” Id. at 1201. 

Additionally, the court found the “instant case does not appear to contain the egregious 

circumstances involved in the cases submitted by defendant.” Id. Thus, in concluding 

that punitive damages should not be used in calculating the amount in controversy in that 

case, the court reasoned that “Defendant’s burden cannot be met simply by pointing out 

that the complaint seeks punitive damages and that any damages awarded under such a 

claim could total a large sum of money, particularly in light of the high burden that must 

be met in order for a plaintiff even to be eligible for receipt of discretionary punishment.” 

Id.

In evaluating whether to include a civil penalty in calculating the amount in 

controversy, this Court agrees with the approach in Conrad. Rather than simply assume

that because a civil penalty is available, one 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. See also Jackson v. Frank, 2012 WL 6096905, * (N.D. Cal. Dec. 

7, 2012) (In evaluating amount in controversy, defendants may introduce evidence of jury 

verdicts in cases involving analogous facts to establish punitive damage amount) (citing 

Simmons v. PCR Tech., 209 F.Supp.2d 1029, 1033-34 (N.D. Cal. 2002).).” Such an 

approach appears more consistent with the general principle that where the state-court 

complaint does not specify a damage figure, the defendant “must provide evidence that it 

is ‘more likely than not’ that the amount in controversy” requirement is satisfied. 

Sanchez, 102 F.3d at 404; see also Matheson v. Progressive Specialty Ins. Co., 319 F.3d 

1089, 1090 (9th Cir. 2003) (in evaluating amount in controversy, courts may consider 

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“facts presented in the removal petition as well as any summary-judgment-type 

evidence); Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (holding defendant 

must prove by a preponderance of the evidence whatever is necessary to support the 

removal). 

Here, aside from citing Brady, Defendant makes no effort to explain why the 

amount in controversy should include a civil penalty of $28,940. Defendant fails to 

identify which allegations in the Complaint would justify such an award; nor does 

Defendant submit evidence regarding the size of civil penalties awarded in analogous 

cases. Accordingly, the Court finds Defendant has failed to establish that the amount in 

controversy should include a civil penalty in the amount of two times Plaintiff’s actual 

damages.

B. Attorney’s Fees

Defendant also contends the amount in controversy should include $9,190.90,

consisting of an estimate regarding Plaintiff’s likely attorney’s fees in this case. (Opp’n

5:25–26.) Plaintiff responds that it would be inappropriate to include possible attorneys’

fees in calculating the amount in controversy, citing Judge Easterbrook’s opinion in 

Gardynski-Leschuck v. Ford Motor Co., 142 F.3d 955, 958 (7th Cir. 1998). (See Reply

4:6–8.)

There is a dispute among the district courts in the Ninth Circuit regarding whether 

to include attorney’s fees incurred after the date of removal. See Stelzer v. CarMax Auto 

Superstores California, LLC, 2013 WL 6795615, * 6 (S.D.Cal. Dec. 20, 2013). Although 

this Court would be inclined to follow those cases limiting the amount of attorney’s fees 

to those actually incurred (see Stelzer, 2013 WL 6795615 and Wastier v. Schwan’s 

Consumer Brands, 2007 WL 4277552 at *3 (S.D. Cal. Dec. 5, 2007)), the issue is 

unnecessary for the resolution of the pending motion. 

As discussed above, Defendant has failed to establish that the amount in 

controversy should include $28,940 in civil penalties. Accordingly, even if the Court 

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were to agree to include Defendant’s estimate of $9,190 in attorney’s fees that Plaintiff 

may incur, the jurisdictional limit would not be satisfied. 

IV. ORDER & CONCLUSION

Because Defendant has not established that the amount in controversy exceeds 

$75,000, the Court GRANTS Plaintiff’s motion [Doc. 5] and ORDERS the case 

remanded to the San Diego Superior Court.

IT IS SO ORDERED.

Dated: April 17, 2018

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