Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_06-cv-00708/USCOURTS-caed-2_06-cv-00708-0/pdf.json

Nature of Suit Code: 442
Nature of Suit: Civil Rights Employment
Cause of Action: 28:1331 Fed. Question: Employment Discrimination

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1

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

CHERYL MCELROY, an individual,

2:06-CV-0708-MCE-DAD

Plaintiff,

v. MEMORANDUM AND ORDER

LOWE’S COMPANIES, INC., a

North Carolina corporation

doing business as LOWE’s HIW,

a Washington Corporation, and

LOWE’S HOME CENTERS, INC., a

North Carolina corporation;

TOM POWERS, an individual;

MATT SIMONICH, an individual,

and DOES 1-100, inclusive,

Defendants.

----oo0oo----

Through the present action, Plaintiff Cheryl McElroy

(“McElroy”) seeks damages from Defendants Tom Powers, Matt

Simonich, Lowe’s HIW, and Lowe’s Home Centers (collectively

“Defendants”) based on alleged violations of certain state and

federal laws.

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 Because oral argument will not be of material assistance, 1

the Court orders this matter submitted on the briefs. E.D. Cal.

Local Rule 78-230(h). 

2

Specifically, McElroy advances the following claims: sex

discrimination, sexual harassment, failure to prevent sexual

harassment, physical disability discrimination, physical

disability harassment, failure to prevent physical disability

harassment, wrongful termination, negligent infliction of

emotional distress, and violation of the Federal Family Medical

Leave Act.

Before the Court are McElroy’s Motion to Amend her Complaint

and her Motion to Remand this action to the San Joaquin Superior

Court. For the reasons explained below, McElroy’s Motions are

granted.1

BACKGROUND

On September 20, 2005, Plaintiff Cheryl McElroy initiated

this action in San Joaquin Superior Court asserting various state

law claims against individual Defendants Powers and Simonich. On

September 27, 2005, McElroy filed her First Amended Complaint

adding as defendants Lowe’s HIW, Inc., and Lowe’s Home Centers. 

On February 28, 2006, McElroy filed a Second Amended Complaint.

Among other modifications, she added a cause of action for

retaliation under the Federal Family Medical Leave Act (“FMLA”). 

McElroy characterizes this addition as an “afterthought” and

attributes it to her counsel’s legal mistake.

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On April 3, 2006, Defendants removed this action to this Court

based on federal question jurisdiction conferred by the addition

of the FMLA cause of action. McElroy now seeks to eliminate that

claim through amendment which will destroy the federal basis upon

which removal was based. Defendants do not oppose her proposed

amendment but nonetheless request that the case proceed in this

federal forum. As explained below, the Court will permit the

amendment but declines to exercise jurisdiction over McElroy’s

remaining state law claims.

STANDARD

I. Motion to Amend

A party may amend the party’s pleading once as a matter of

course at any time before a responsive pleading is served. Fed.

R. Civ. P. 15(a). Otherwise, leave of court or written consent

of the adverse party is required to amend a pleading. Id.

Granting or denial of leave to amend rests in the sound

discretion of the trial court, and will be reversed only for

abuse of discretion. Swanson v. U.S. Forest Serv., 87 F.3d 339,

343 (9th Cir. 1996). Leave “shall be freely given when justice

so requires.” Fed. R. Civ. P. 15(a).

Leave to amend is usually granted with “extreme liberality.” 

Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1051 (9th

Cir. 2003).

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4

Giving plaintiffs broad latitude to amend their complaints

furthers the federal system’s goal of adjudication on the merits,

not on procedural technicalities. See Foman v. Davis, 371 U.S.

178, 182 (1962). An outright denial of leave to amend without

any explanation is subject to reversal. Id.

While leave to amend is typically granted with extreme

liberality, courts have identified the following factors that may

support a denial of leave to amend: undue delay, bad faith or

dilatory motive, futility of amendment, prejudice to the opposing

party, and repeated failure to cure deficiencies by previous

amendments. See, e.g., Eminence Capital, 316 F.3d at 1052. By

far the most important factor is prejudice to the opposing party:

“prejudice is the touchstone of the inquiry under Rule 15(a).” 

Id. (internal citation omitted). But without prejudice or a

strong showing of any of the other factors, “there exists a

presumption under Rule 15(a) in favor of granting leave to

amend.” Id.

II. Motion to Remand

A defendant may remove any civil action from state court to

federal district court if the district court has original

jurisdiction over the matter. 28 U.S.C. § 1441(a). Generally,

district courts have original jurisdiction over civil actions in

two instances: (1) where there is complete diversity between the

parties, or (2) where a federal question is presented in an

action arising under the Constitution, federal law, or treaty. 

28 U.S.C. §§ 1331 and 1332. 

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5

The removing party bears the burden of establishing federal

jurisdiction. Ethridge v. Harbor House Rest., 861 F.2d 1389,

1393 (9th Cir. 1988). Furthermore, courts construe the removal

statute strictly against removal. Gaus v. Miles, Inc., 980 F.2d

564, 566 (9th Cir. 1992) (citations omitted). If there is any

doubt as to the right of removal in the first instance, remand

must be granted. See Gaus, 980 F.2d at 566. Therefore, if it

appears before final judgment that a district court lacks subject

matter jurisdiction, the case shall be remanded to state court. 

28 U.S.C. § 1447(c).

If the district court determines that removal was improper,

then the court may also award the plaintiff costs and attorney

fees accrued in response to the defendant’s removal. 28 U.S.C. §

1447(c). The court has broad discretion to award costs and fees

whenever it finds that removal was wrong as a matter of law. 

Balcorta v. Twentieth-Century Fox Film Corp., 208 F.3d 1102, 1106

n.6 (9th Cir. 2000).

ANALYSIS

1. McElroy’s Motion for Leave to Amend her Complaint

A plaintiff may amend her complaint once as a matter of

course or by written consent of the adverse party; otherwise,

leave of court is required to amend a pleading. Fed. R. Civ. P.

15(a).

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 FRCP 15(a) allows amendment “by written consent of the 2

adverse party.” Fed. R. Civ. P. 15(a). This usually takes the

form of a written stipulation signed by both parties. In this

case, the parties may have been moving toward a written

stipulation, but it never materialized. See Declaration of David

D. Cheng ¶6; Declaration of Juanita E. Mantz ¶2.

6

Because McElroy is seeking a third amendment and Defendants have

not presented the Court with proper written consent, she may only

amend with leave of court.2

As noted above, leave to amend should be “freely given when

justice so requires.” Fed. R. Civ. P. 15(a). See, e.g.,

Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1051 (9th

Cir. 2003). Accordingly, absent a showing of undue delay, bad

faith or dilatory motive, futility of amendment, prejudice to the

opposing party, or repeated failure to cure deficiencies by

previous amendments, leave to amend is proper. Id. at 1052.

Here, the balance tips in favor of McElroy. First,

Defendants do not allege, nor does the Court find, that they will

be prejudiced by permitting McElroy to amend her Complaint. 

Further, there is no evidence that McElroy unduly delayed her

Motion. In fact, McElroy filed it one month after Defendants

removed the case to this Court. Similarly, there is no

indication of bad faith nor is McElroy’s Motion futile because it

affects subject matter jurisdiction, a vital component of any

claim. In sum, the Court finds no countervailing factors to

outweigh the strong presumption in favor of granting leave to

amend. Therefore, McElroy’s Motion for Leave to Amend her

Complaint is properly granted.

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2. McElroy’s Motion to Remand

A defendant may remove any civil action from state court to

federal district court if the district court has original

jurisdiction over the matter. 28 U.S.C. § 1441(a). After

removal, the district court can exercise supplemental

jurisdiction over plaintiff’s state law claims if they are part

of the “same case or controversy” as the federal claim. 28

U.S.C. § 1367(a). Because McElroy’s FMLA claim clearly falls

under this Court’s original subject matter jurisdiction,

Defendants’ removal of the action to this Court was proper. The

Court also has supplemental jurisdiction over McElroy’s state law

claims because they are part of the same case or controversy as

McElroy’s FMLA claim.

Even though McElroy amended her Complaint to eliminate the

sole federal cause of action, the Court may nonetheless

adjudicate McElroy’s state law claims. See Albingia

Versicherungs A.G. v. Schenker Int’l Inc., 344 F.3d 931 (9th Cir.

2003). In Albingia, the court held that, so long as the original

removal was proper, a federal district court’s supplemental

jurisdiction over related state law claims was not destroyed upon

dismissal of the federal claim. Id. Similarly, a plaintiff

cannot escape federal jurisdiction after removal by submitting an

amended complaint. See Sparta Surgical Corp. v. Nat’l Ass’n of

Secs. Dealers, Inc., 159 F.3d 1209, 1213 (9th Cir. 1998) (“a

plaintiff may not compel remand by amending a complaint to

eliminate the federal question upon which removal was based”).

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8

Defendants’ removal was proper and the federal question

existed at time of removal. Therefore, even after McElroy

eliminated the federal question through amendment, this Court

still retains jurisdiction over McElroy’s state law claims.

While the decision to adjudicate McElroy’s state law claims

lies completely within the Court’s discretion, policy reasons

generally favor the remand or dismissal of purely state law

claims. “[I]n the usual case in which all federal-law claims are

eliminated before trial, the balance of factors ... will point

toward declining to exercise jurisdiction over the remaining

state law claims.” Acri v. Varian Assocs., 114 F.3d 999, 1001

(9th Cir. 1997) (quoting Carnegie-Mellon Univ. V. Cohill, 484

U.S. 343, 350 n.7 (1988)). The Court must balance a number of

factors in determining whether to keep the state claims such as

judicial economy, convenience, fairness, and comity. See United

Mine Workers v. Gibbs, 383 U.S. 715, 726 (1966). 

Applying the Gibbs factors to this case, the Court finds it

appropriate to remand this action. McElroy’s FMLA claim was the

only federal cause of action out of ten claims in her Second

Amended Complaint. Whether it was an “afterthought” or an

attempt to forum shop, the FMLA claim is not central to the

merits of McElroy’s case. State law issues predominate in this

case. Therefore, the interests in judicial economy and comity

far outweigh any potential inconvenience Defendants might suffer

from remand.

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9

Given the Court’s decision not to exercise pendant

jurisdiction over McElroy’s state claims, the Court has

discretion either to dismiss the case or to remand it to the

state court. The Court finds that remand better serves the

interests of convenience and comity. In light of these

considerations, the Court grants McElroy’s Motion to Remand.

 

3. Defendants’ Request for Attorneys Fees

Defendants request that the Court consider McElroy’s

“manipulative” behavior and impose sanctions accordingly. See

Baddie v. Berkeley Farms, Inc., 64 F.3d 487 (9th Cir. 1995). 

Because McElroy’s decision to add the FMLA claim was either an

honest mistake or a “legitimate tactical decision” within the

scope of Baddie, McElroy’s behavior does not warrant sanctions.

The Court also declines to impose sanctions under Rule 11 of

the Federal Rules of Civil Procedure. For the reasons stated

above, the Court finds no bad faith on McElroy’s part that would

require such action.

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CONCLUSION

For the preceding reasons, McElroy’s Motion for Leave to

Amend her Complaint is GRANTED. McElroy’s Motion for Remand is

GRANTED and this case is remanded to San Joaquin Superior Court.

IT IS SO ORDERED. 

DATED: July 5, 2006

_____________________________

MORRISON C. ENGLAND, JR

UNITED STATES DISTRICT JUDGE

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