Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_19-cv-03133/USCOURTS-cand-5_19-cv-03133-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Contract Dispute

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

EVEREST SYSTEMS COMPANY,

Plaintiff,

v.

PLATINUM ROOFING, INC.,

Defendant.

Case No. 19-cv-03133-BLF 

ORDER DISCHARGING ORDER TO 

SHOW CAUSE; VACATING

OCTOBER 10, 2019 HEARING; 

GRANTING MOTION TO REMAND

On June 5, 2019, Defendant Platinum Roofing, Inc. (“Platinum”) removed this case to 

federal court on the basis of diversity jurisdiction. See Not. of Removal (“NOR”), ECF 1. 

Platinum is a California corporation with its principal place of business in San Jose, California. 

Id. at 2; Peretz Decl. ISO Removal, Ex. 5, ECF 1-1. On June 21, 2019, the Court issued an Order 

to Show Cause why the case should not be remanded for lack of subject matter jurisdiction under 

the “forum defendant rule,” 8 U.S.C. § 1441(b)(2), which states that “[a] civil action otherwise 

removable solely on the basis of [diversity jurisdiction] may not be removed if any of the parties 

in interest properly joined and served as defendants is a citizen of the State in which such action is 

brought.” ECF 9. On July 3, 2019, Platinum responded conceding that it had improperly removed 

the case under Section 1441 but arguing that the defect is a “waivable and non-jurisdictional 

procedural defect” not subject to sua sponte remand. ECF 11 at 1. The Court agrees and 

DISCHARGES the Order to Show Cause.

On July 5, 2019, thirty days after Platinum filed its Notice of Removal, Plaintiff Everest 

Systems Company (“Everest”) moved to remand the case under the forum defendant rule. ECF 

12. This motion was timely under 28 U.S.C. § 1447(c). The Court finds the motion suitable for 

disposition without oral argument, Civ. L.R. 7-1(b), and VACATES the October 10, 2019 hearing.

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United States District Court

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Platinum’s only rejoinder to remand is that Everest “waived the right to remand 

by . . . engaging in affirmative conduct suggesting a waiver of the right to remand.” SWC Inc. v. 

Elite Promo Inc., 234 F. Supp. 3d 1018, 1022 (N.D. Cal. 2017) (citing Owens v. Gen. Dynamics 

Corp., 686 F. Supp. 827, 830 (S.D. Cal. 1988)). Platinum argues that Everest engaged in such 

conduct by serving initial disclosures two months before the deadline in the case and consenting to 

magistrate judge jurisdiction. See generally Opp., ECF 16. 

To waive a remand challenge by affirmative conduct, the plaintiff must engage in 

“affirmative conduct or unequivocal assent of a sort which would render it offensive to 

fundamental principles of fairness to remand.” SWC Inc., 234 F. Supp. 3d at 1022. Generally, 

“[w]aiver of the right to remand has been found where [the] plaintiff has filed numerous pleadings 

and discovery requests after a case has been removed to federal court.” Id. at 1023. By contrast, 

“[c]ourts generally have not found waiver where a plaintiff undertakes minimal or expected casemanagement obligations once a case is removed.” Id. at 1023; see, e.g., Student A. By & Through 

Mother of Student A. v. Metcho, 710 F. Supp. 267, 269 (N.D. Cal. 1989) (finding the plaintiff did 

not waive her right to remand by filing a jury demand); Magill v. Wick Towing, Inc., No. C16-

0348 JLR, 2016 WL 3476449, at *2 (W.D. Wash. June 21, 2016) (finding the plaintiff did not 

waive his right to remand by filing a joint status report and serving initial disclosures).

Here, Everest’s conduct clearly falls in the category of “minimal or expected casemanagement obligations” rather than “numerous pleadings and discovery requests.” There is no 

way to construe Everest’s action here as “unequivocal assent.” In consenting to the magistrate 

judge, Platinum was simply complying with its court-ordered deadline. See ECF 3 (setting 

consent/declination deadline to June 19, 2019); see Student A, 710 F. Supp. at 269. That Everest 

consented does not demonstrate its affirmative consent to be in federal court. As Platinum 

recognizes, magistrate judges can issue a report and recommendation to remand. See Opp. at 6; 

Flam v. Flam, 788 F.3d 1043, 1047 (9th Cir. 2015). Plaintiffs like Everest still need to perform 

their case management obligations in the thirty days in which they have to prepare any motion to 

remand. Likewise, Everest’s early service of initial disclosures within the thirty day window is in 

no way an indication that it intended to remain in federal court. See Magill, 2016 WL 3476449, at 

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*2. As such, Everest did not waive its right to move to remand based on the forum defendant rule.

Everest also moves for attorneys’ fees and costs in the amount of $2,800 for its efforts in 

opposing removal. See Reply at 2, ECF 17; Kandel Decl. ISO Reply ¶¶ 3–7, ECF 17-1. 28 U.S.C. 

§ 1447(c) provides that “[a]n order remanding the case may require payment of just costs and any 

actual expenses, including attorney fees, incurred as a result of the removal.” District courts have 

wide discretion in deciding to award fees. Martin v. Franklin Capital Corp., 546 U.S. 132, 139

(2005). “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. 

Conversely, when an objectively reasonable basis exists, fees should be denied.” Id. The Court 

can find no objectively reasonable basis for Platinum to seek removal here, when its removal was 

clearly barred by the forum defendant rule. Even though this rule is merely procedural and thus 

waivable, it would flout the forum defendant rule if the Court were to condone in-state defendants 

baselessly removing to federal court in the hopes that a plaintiff will waive its right to remand. 

Neither the removal statute nor this Court countenances such wasteful gambling.

Everest’s motion to remand is GRANTED, and Everest is awarded fees in the amount of 

$2,800. Plaintiff’s counsel’s hourly rate of $350/hour is reasonable considering counsel’s years of 

experience and comparable rates charged in this District. Compensation for eight hours of 

attorney time to draft this motion and reply is also reasonable based on the nature and complexity 

of the issues presented.

The Clerk shall REMAND this case to Santa Clara County Superior Court. All other 

matters are TERMINATED and VACATED, and the Clerk shall close this file

IT IS SO ORDERED.

Dated: July 26, 2019

______________________________________

BETH LABSON FREEMAN

United States District Judge

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