Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_07-cv-01258/USCOURTS-caed-2_07-cv-01258-2/pdf.json

Nature of Suit Code: 442
Nature of Suit: Civil Rights Employment
Cause of Action: 28:1441 Petition for Removal - Employment Discrimination

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

----oo0oo----

LLOYD D. HAMBLIN, HOLLY 

HAMBLIN,

NO. CIV. S-07-1258 WBS KJM

Plaintiffs,

v. REVISED ORDER RE: MOTION TO

REMAND

COINSTAR, INC., a corporation;

DOES 1 through 30, inclusive,

Defendants.

----oo0oo----

Plaintiffs Lloyd D. and Holly Hamblin (“plaintiffs”)

filed an action in state court, alleging wrongful termination. 

Defendant, Coinstar, Inc., removed the matter based on diversity

jurisdiction, 28 U.S.C. § 1331, and plaintiffs moved to remand

the case. In an order dated September 17, 2007, this court

denied plaintiffs’ motion to remand; however, further

consideration now persuades this court to revise its September

17, 2007 order. 

///

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1 The bar against removal in § 1445(c) is procedural,

thus does not limit the court’s subject matter jurisdiction and

can be waived. Vasquez v. N. County Transit Dist., 292 F.3d

1049, 1062 (9th Cir. 2002). 

2

To avoid repetition, the court will refrain from

reciting the factual and procedural background, which remains the

same as in its order denying plaintiffs’ motion to remand. 

(Sept. 17, 2007 Order 1-2.) 

Federal Rule of Civil Procedure 54(b) grants courts the

power to revise an order at any time before entering a final

judgment. Fed. R. Civ. P. 54(b). The Ninth Circuit has also

described this ability as an “inherent power” of the court. 

Balla v. Idaho State Bd. of Corrs., 869 F.2d 461, 465 (9th Cir.

1989). 

As explained in the previous order, this case satisfies

the requirements of diversity jurisdiction under § 1331, thus the

court has subject matter jurisdiction. When a case is removed

based on diversity jurisdiction, “[d]oubts of removability”

should be “resolved in favor of remanding the case to state

court.” Quinones v. Target Stores, No. 05-03570, 2005 WL

3157515, at *2 (N.D. Cal. Nov. 23, 2005) (citing Shamrock Oil &

Gas Corp. v. Sheets, 313 U.S. 100, 108-09 (1941) and Gaus v.

Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992)). 

Plaintiffs contend that removal is barred by 28 U.S.C.

§ 1445(c). The court now agrees. Specifically, § 1445(c)

provides that “[a] civil action in any State court arising under

the workmen’s compensation laws of such State may not be removed

to any district court of the United States.”1 The question here

is therefore whether plaintiffs’ claim “arises under”

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California’s workers’ compensation laws. 

The term “arising under” in the context of § 1445(c)

has the same meaning as “arising under” in 28 U.S.C. § 1331,

which governs federal question jurisdiction. Reed v. Heil Co.,

206 F.3d 1055, 1059 (11th Cir. 2000); Humphrey v. Sequentia,

Inc., 58 F.3d 1238, 1245-46 (8th Cir. 1995); Jones v. Roadway

Express, Inc., 931 F.2d 1086, 1092 (5th Cir. 1991); Zurich Am.

Ins. Co. v. Gen. Motors Corp., 242 F. Supp. 2d 736, 737 (E.D.

Cal. 2003). In defining “arising under” for purposes of § 1331,

the Ninth Circuit has explained that 

[a] claim arises under a federal law within § 1331 if it

is apparent from the face of the complaint either that

(1) a federal law creates the plaintiff’s cause of

action; or (2) if a state law creates the cause of

action, a federal law that creates a cause of action is

a necessary element of the plaintiff’s claim. 

Virgin v. County of San Luis Obispo, 201 F.3d 1141, 1142-43 (9th

Cir. 2000). Therefore, for purposes of § 1445(c), plaintiffs’

claim “arises under” California’s workers’ compensation laws if

the workers’ compensation laws create plaintiffs’ cause of action

or if it is necessary to interpret those laws to resolve

plaintiffs’ claim. 

Plaintiffs’ complaint alleges that defendant wrongfully

discharged plaintiff after plaintiff filed a workers’

compensation claim. The Ninth Circuit has not decided whether

such a claim “arises under” workers’ compensation laws, and other

circuits have reached different conclusions. For example, the

Fifth Circuit held that a retaliatory discharge claim, which was

not codified in the workers’ compensation laws, “arose under”

those laws; however, the Seventh Circuit held that a common law

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retaliatory discharge claim did not. Jones, 931 F.2d at 1092;

Spearman v. Exxon Coal USA, Inc., 16 F.3d 722, 725-26 (7th Cir.

1994). 

Despite the different conclusions in circuits where a

retaliatory discharge claim is not codified in the workers’

compensation laws, application of § 1445(c) is more

straightforward if a state’s workers’ compensation laws create

the plaintiff’s cause of action. Humphrey, 58 F.3d at 1245-46

(distinguishing Spearman and holding that a retaliatory discharge

claim, codified in the state’s workers’ compensation laws,

“arises under” those laws); Quinones v. Target Stores, No. 05-

03570, 2005 WL 3157515, at *5 (N.D. Cal. Nov. 23, 2005) (holding

that § 1445(c) bars removal of a common law retaliatory discharge

claim because the public policy against such termination is

codified in section 132a of the state’s workers’ compensation

laws); see also Franchise Tax Bd. of the State of Cal. v.

Construction Laborers Vacation Trust for Se. Cal., 463 U.S. 1,

27-28 (1983) (explaining that, for § 1331, “arising under”

includes “cases in which . . . federal law creates the cause of

action . . .”). 

In its earlier order, this court failed to recognize

the significance of the fact that in California, Labor Code

section 132a codifies a claim for retaliatory discharge. In

relevant part, section 132a provides: 

It is the declared policy of this state that there should

not be discrimination against workers who are injured in

the course and scope of their employment. (1) Any

employer who discharges . . . any employee because he or

she has filed or made known his or her intention to file

a claim for compensation with his or her employer . . .

is guilty of a misdemeanor and the employee’s

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2 In City of Moorpark v. Superior Court of Ventura

County, 18 Cal. 4th 1143, 1155-56 (1998), the court assumed for

purposes of argument that Labor Code section 5300 establishes

that the Workers’ Compensation Appeals Board is the exclusive

forum for pursuing a section 132a claim. 

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compensation shall be increased by one-half . . . . Any

such employee shall also be entitled to reinstatement and

reimbursement for lost wages and work benefits caused by

the acts of the employer. 

For an employee fired for filing a workers’

compensation claim, the remedy that section 132a provides is twofold. First, the employee can file a section 132a claim and seek

relief under section 132a. Presumably, this claim must be filed

with the Workers’ Compensation Appeals Board.2 Cal. Labor Code §

5300. Alternatively, the employee can use section 132a to file a

common law termination in violation of public policy claim,

commonly known as a “Tameny” claim. Tameny v. Atl. Richfield

Co., 27 Cal. 3d 167, 176 (1980). To assert a Tameny claim, the

plaintiff must identify the specific public policy the

termination violated and the public policy must derive from a

constitutional provision, statute, or administrative regulation

that serves a statutory objective. City of Moorpark v. Superior

Court of Ventura County, 18 Cal. 4th 1143, 1159 (1998)

(discussing Stevenson v. Superior Court of L.A. County, 16 Cal.

4th 880, 894 (1997) and Green v. Ralee Eng’g Co., 19 Cal. 4th 66,

79-80 (1998)). 

Thus, because section 132a provides the necessary

public policy, it appears plaintiffs’ claim would not exist

without it. Neither plaintiffs in their complaint nor defendant

is its moving papers have identified any alternative

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constitutional provision, statute, or regulation that provides a

public policy adequate to sustain plaintiffs’ claim. 

Accordingly, section 132a, which is part of the state’s workers’

compensation laws, “clearly creates [the] substantive right to be

free from retaliatory discharge after making a workers’

compensation claim.” Quinones, 2005 WL 3157515, at *5. Not only

does section 132a create plaintiffs’ substantive rights, it also

provides the limits of plaintiffs’ claim. See City of Moorepark,

18 Cal. 4th at 1159 (“[W]hen the constitutional provision or

statute articulating a public policy also includes certain

substantive limitations in scope or remedy, these limitations

also circumscribe the common law wrongful discharge cause of

action.”). Plaintiffs’ wrongful termination claim is therefore

dependent on and “arises under” California’s workers’

compensation laws.

Defendant further contends that plaintiffs’ claim does

not arise under state workers’ compensation laws because

plaintiffs also seek relief under the California Fair Employment

and Housing Act (FEHA) and plaintiff’s wife, a non-employee, also

seeks recovery. First, the complaint contains only a single

cause of action, and although it mentions FEHA (California

Government Code § 12940(h)), the only factual basis of liability

alleged in the complaint is the termination of plaintiff Lloyd

Hamblin’s employment in retaliation for filing a workers’

compensation claim. Second, even if the complaint did contain a

FEHA claim, when removable claims are joined with non-removable

claims, the court has discretion to “remand all matters in which

State law predominates.” 28 U.S.C. § 1441(c).

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Congress enacted § 1445(c) to preserve a plaintiff’s

choice of forum, to protect “‘states’ interest in administering

their own workers’ compensation schemes,’” and to reduce the

workload that workers’ compensation cases cause in federal

courts. Vasquez v. N. County Transit Dist., 292 F.3d 1049, 1061,

1061 n.6 (9th Cir. 2002) (quoting Armistead v. C & M Transport,

Inc., 49 F.3d 43, 46 (1st Cir. 1995)). With these policies in

mind, all claims in a case that primarily relies on a workers’

compensation right should be heard together, in state court. 

Accordingly, this court will revise its September 17, 2007 order.

Furthermore, because the court denied plaintiffs’

motion to remand in its previous order, it did not decide

plaintiffs’ request for the attorney’s fees and costs associated

with seeking remand or plaintiffs’ request for sanctions under

Federal Rule of Civil Procedure 11. 

Under 28 U.S.C. § 1447(c), when a case is remanded, a

court can award the non-removing party “just costs and any actual

expenses, including attorneys fees, incurred as a result of the

removal.” “Absent unusual circumstances, courts may award

attorney’s fees under § 1447(c) only where the removing party

lacked an objectively reasonable basis for seeking removal.” 

Martin v. Franklin Capital Corp., 546 U.S. 132, 141 (2005). 

In this case, there have been inconsistent district

court decisions within this circuit on the question of whether §

1445(c) applies to retaliatory discharge claims. Compare

Quinones v. Target Stores, No. C 05-03570 JW, 2005 WL 3157515, at

*4 (N.D. Cal. Nov. 23, 2005) (holding that § 1445(c) bars removal

of a retaliatory discharge claim) with Beaver v. NPC Int’l, Inc.,

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3 While plaintiffs also request sanctions under Federal

Rule of Civil Procedure Rule 11, plaintiffs’ request is

procedurally deficient and will not be considered. Rule 11

plainly requires that a “motion for sanctions . . . be made

separately from other motions.” Fed. R. Civ. P. 11. In seeking

Rule 11 sanctions in their motion for remand, plaintiffs failed

to meet the precise requirements for a Rule 11 motion for

sanctions. See Arellano v. Home Depot U.S.A., Inc., 245 F. Supp.

2d 1102, 1109 (S.D. Cal. 2003) (declaring that defendant’s

request for sanctions was “procedurally defective” because it

“was contained in its opposition to plaintiff’s motion to

remand”). 

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451 F.Supp.2d 1196, 1201 (holding that § 1445(c) does not bar

removal of a retaliatory discharge claim), and the Ninth Circuit

has not yet decided the issue. Therefore, while this court

ultimately concludes that § 1445(c) barred removal, it does not

find that defendant lacked an objectively reasonable basis in

seeking removal, thus will not award costs or fees.3

IT IS THEREFORE ORDERED that (1) this court’s September

17, 2007 order denying plaintiffs’ motion to remand be, and the

same hereby is, VACATED; (2) plaintiffs’ motion to remand be, and

the same hereby is, GRANTED; and (3) plaintiffs’ motion for

attorneys’ fees and costs be, and the same hereby is, DENIED.

This matter is hereby REMANDED to the Superior Court of the State

of California in and for the County of Shasta.

DATED: November 21, 2007

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