Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_07-cv-01265/USCOURTS-casd-3_07-cv-01265-0/pdf.json

Nature of Suit Code: 150
Nature of Suit: Overpayments &amp; Enforcement of Judgments
Cause of Action: 28:1332 Diversity-Other Contract

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07cv1265

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

CURTIS INTERNATIONAL LTD.,

Plaintiff,

v.

EWEST ADVANTAGE, INC.

Defendant.

 

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Civil No. 07CV1265 JAH(CAB)

ORDER DENYING PLAINTIFF’S

MOTION FOR RIGHT TO

ATTACH ORDER AND WRIT OF

ATTACHMENT AND SUA

SPONTE DISMISSING

COMPLAINT FOR LACK OF

SUBJECT MATTER

JURISDICTION

INTRODUCTION

Now before the Court is the motion filed by plaintiff Curtis International Ltd.

(“plaintiff” or “Curtis”) for a right to attach order and writ of attachment to secure

recovery of a claim against defendant EWest Advantage, Inc. (“defendant” or “EWest”).

The motion has been fully briefed by the parties and oral argument has been entertained.

After a careful consideration of the pleadings and relevant exhibits submitted by the

parties both prior to and after the hearing, along with the oral argument presented at the

hearing, and for the reasons set forth below, this Courts DENIES plaintiff’s motion and

sua sponte dismisses the instant complaint for lack of subject matter jurisdiction.

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Case 3:07-cv-01265-JAH-CAB Document 25 Filed 08/27/07 Page 1 of 4
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1

 This Court had previously granted plaintiff’s ex parte request to shorten the time for hearing

plaintiff’s motion, setting a short briefing schedule for responsive pleadings and an early hearing date. See

Doc. # 5.

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BACKGROUND

Curtis commenced an action for breach of contract against EWest in Canada.

EWest did not submit a response or make any appearance in that matter. On May 11,

2007, based on EWest’s failure to respond or appear, the Canadian court entered a default

judgment in the amount of $74,106.18 in U.S. dollars, which included interest from the

date of judgment, plus costs in Canadian dollars. On July 12, 2007, Curtis filed a

complaint in this District seeking enforcement of that foreign default judgment or, in the

alternative, an award of damages for defendant’s alleged breach of contract. 

The instant motion for a right to attach order and issuance of a writ of attachment

was filed on July 19, 2007.1 On July 26, 2007, defendant filed its opposition to the

motion. Plaintiff, on July 31, 2007, filed a notice of supplemental authority and

additional evidence in support of its motion. This Court entertained oral argument on the

motion on August 1, 2007. At the conclusion of the hearing, this Court took the motion

under submission but directed the parties to file supplemental briefs. Defendant filed its

supplemental brief on August 3, 2007 and plaintiff filed its supplemental brief on

August 7, 2007.

DISCUSSION

The federal court is one of limited jurisdiction. See Gould v. Mutual Life Ins. Co.

v. New York, 790 F.2d 769, 774 (9th Cir. 1986). As such, it cannot reach the merits of

any dispute until it confirms its own subject matter jurisdiction. Steel Co. v. Citizens for

a Better Environ., 118 S.Ct. 1003, 1012 (1998). Thus, even though this matter is before

the Court on plaintiff’s motion for a right to attach order and writ of attachment based

on the foreign default judgment entered in Canada, this Court must address the issue of

the Court’s subject matter jurisdiction first. The instant complaint alleges diversity as the

sole basis for this Court’s jurisdiction. See Compl. ¶ 6. 

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 The docket entry for this declaration indicates that there are three exhibits attached labeled A, B

and C but none of the attached exhibits are marked as such. This Court assumes that the “Statement of

Claim” and its supporting documents are Exhibit A, the “Requisition for Default Judgment” and “Judgment”

are Exhibit B, and the documents involving plaintiff’s motion to strike are Exhibit C. See Doc. # 10, Exhs. AC.

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To establish diversity jurisdiction, plaintiff must show: (1) complete diversity

among opposing parties; and (2) an amount in controversy exceeding $75,000, exclusive

of interests and costs. See 28 U.S.C. § 1332(a). The burden of proving jurisdictional facts

is on the party asserting jurisdiction. McNutt v. General Motors Acceptance Corp., 298

U.S. 178, 182 (1936); Fenton v. Freedman, 748 F.2d 1358, 1359 n.1 (9th Cir. 1984).

The diversity statute is strictly construed and any doubts are resolved against finding

jurisdiction. Kantor v. Wellesley Galleries, Ltd., 704 F.2d 1088, 1092 (9th Cir. 1983).

In opposition to plaintiff’s motion, defendant argues that the amount in controversy

here is below the jurisdictional minimum. See Opp. at 5. The default judgment request

presented to the Canadian court sought a principal amount of $71,119.18 plus interest

and costs. The judgment entered by the Canadian court on May 11, 2007 states that:

THIS COURT ORDERS AND ADJUDGED that the Defendant pay to the Plaintiff the sum of $74,106.18 (US) and the sum of $1,000 (CAN) for costs of this action. . . . THIS JUDGMENT BEARS INTEREST at the rate

of 6 per cent per year from its date.

Doc. # 10 (Diskin Decl.), Exh. B.2 Although interest on a judgment cannot be used to

enhance the amount in controversy because it would be contrary to the intent of the

diversity statute, see Brainin v. Melikian, 396 F.2d 153, 155 (3d Cir. 1968)(“Congress

limited federal diversity jurisdiction to cases involving in excess of [the jurisdictional

amount] ‘exclusive of interest’ ... to prevent the delaying of a suit merely to accumulate

the necessary amount for federal jurisdiction.”), pre-judgment interest awarded in the

judgment is merged into the judgment and included in the calculation for jurisdictional

purposes. Phoenix Scotts-Sports v. Kadish, 321 F.Supp. 556 (D.C.Alaska 1971). 

Here, without the inclusion of the $1,000 (CAN) for costs or the post-judgment

interest (both specifically awarded in the judgment), the amount in controversy has not

been met. Plaintiff, at the hearing, suggested to the Court that the amount of costs

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awarded by the Canadian court, when added to the total monetary judgment award, brings

the claimed amount over the jurisdictional threshold. However, plaintiff has not cited, nor

has this Court’s independent research unearthed, any authority for the proposition that

costs of suit, even if awarded in the judgment, can be properly taken into account in

determining the amount in controversy. This Court is unconvinced that costs of suit are

properly included in the calculation of the amount in controversy. 

The diversity statute specifically excludes costs in the calculation and this Court sees

no reason to include those costs in determining the amount in controversy. See 28 U.S.C.

§ 1332(a). This Court is also mindful that the diversity statute is to be strictly construed

and any doubts regarding jurisdiction should be resolved against jurisdiction. See Kantor,

704 F.2d at 1092. This Court finds that the amount in controversy here is $74,106.18,

the amount awarded in the Canadian judgment without the inclusion of costs. Therefore,

a strict construction renders subject matter jurisdiction lacking in this case because the

amount in controversy does not exceed $75,000. 28 U.S.C. § 1332(a). Accordingly,

plaintiff is not entitled to a right to attach order or writ of attachment because this Court

lacks subject matter jurisdiction over plaintiff’s claims. 

Additionally, because subject matter jurisdiction is lacking, the instant complaint

must be sua sponte dismissed. See Fed.R.Civ.P. 12(h).

CONCLUSION AND ORDER

Based on the foregoing, IT IS HEREBY ORDERED that:

1. Plaintiff’s motion for a right to attach order and writ of attachment is

DENIED; and

2. The instant complaint is sua sponte DISMISSED for lack of subject matter

jurisdiction. The Clerk of Court shall close the file.

DATED: August 27, 2007

HON. JOHN A. HOUSTON

United States District Judge

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