Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_19-cv-01162/USCOURTS-cand-3_19-cv-01162-0/pdf.json

Parties Involved:
Kevin Abbey
Defendant
Arturo Aguilar
Plaintiff
Linn Star Transfer, Inc.
Defendant

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

ARTURO AGUILAR,

Plaintiff,

v.

LINN STAR TRANSFER, INC., et al.,

Defendants.

Case No. 19-cv-01162-JCS 

ORDER TO SHOW CAUSE WHY 

CASE SHOULD NOT BE REMANDED

OR WHY CLAIM AGAINST KEVIN 

ABBEY SHOULD NOT BE DISMISSED

I. BACKGROUND

Defendants Linn Star Transfer, Inc. and Kevin Abbey removed this action from the 

California Superior Court for the County of Alameda, asserting diversity jurisdiction under 28 

U.S.C. § 1332. Defendants assert that Plaintiff Arturo Aguilar is a citizen of California and 

Defendant Linn Star Transfer is a citizen of Iowa. Notice of Removal (dkt. 1) ¶¶ 20–21. 

Although Abbey “is a non-diverse defendant,” Defendants argue that “his citizenship is 

inconsequential under the doctrine of fraudulent joinder because there is no possibility the plaintiff 

can establish liability against this individual.” Id. ¶ 22.

Defendants answered Aguilar’s complaint in state court without seeking to dismiss the 

claim against Abbey at the pleading stage. See dkt. 1-2. After removal, both parties consented the 

jurisdiction of the undersigned magistrate judge for all purposes pursuant to 28 U.S.C. § 636(c). 

The generally applicable thirty-day deadline for Aguilar to file a motion to remand has expired, 

although a case may be remanded at any time for a defect in subject matter jurisdiction. See 28 

U.S.C. § 1447(c).

II. LEGAL STANDARD

Federal courts have limited subject matter jurisdiction, and may only hear cases falling 

within their jurisdiction. Generally, a defendant may remove a civil action filed in state court if 

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United States District Court

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the action could have been filed originally in federal court. 28 U.S.C. § 1441. The removal 

statutes are construed restrictively so as to limit removal jurisdiction. Shamrock Oil & Gas Corp. 

v. Sheets, 313 U.S. 100, 108−09 (1941). The Ninth Circuit recognizes a “strong presumption 

against removal.” Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (internal quotation marks

omitted). Any doubts as to removability should be resolved in favor of remand. Matheson v. 

Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003). The defendant bears the 

burden of showing that removal is proper. Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1117 (9th 

Cir. 2004). 

Diversity jurisdiction under § 1332(a) “applies only to cases in which the citizenship of 

each plaintiff is diverse from the citizenship of each defendant,” Caterpillar Inc. v. Lewis, 519 

U.S. 61, 68 (1996), but “fraudulently joined defendants will not defeat removal on diversity 

grounds.” Ritchey v. Upjohn Drug Co., 139 F.3d 1313, 1318 (9th Cir. 1998). “The term 

‘fraudulent joinder’ is a term of art, used for removal purposes, and does not connote any intent to 

deceive on the part of plaintiff or his counsel.” Plute v. Roadway Package Sys., Inc., 141 F. Supp. 

2d 1005, 1008 n.2 (N.D. Cal. 2001).

“Joinder of a non-diverse defendant is deemed fraudulent, and the defendant’s presence in 

the lawsuit is ignored for purposes of determining diversity, if the plaintiff fails to state a cause of 

action against a resident defendant, and the failure is obvious according to the settled rules of the 

state.” Morris v. Princess Cruises, Inc., 236 F.3d 1061, 1067 (9th Cir. 2001). Just as there is a 

presumption against removal, there is a “general presumption against fraudulent joinder.” Hunter 

v. Philip Morris USA, 582 F.3d 1039, 1046 (9th Cir. 2009). When analyzing the issue of 

fraudulent joinder, “[a]ll doubts concerning the sufficiency of a cause of action because of inartful, 

ambiguous or technically defective pleading must be resolved in favor of remand, and a lack of 

clear precedent does not render the joinder fraudulent.” Krivanek v. Huntsworth Grp. LLC, No. 

15-CV-02466-HSG, 2015 WL 5258788, at *2 (N.D. Cal. Sept. 9, 2015) (citation and internal 

quotation marks omitted). “[T]he test for fraudulent joinder and for failure to state a claim under 

Rule 12(b)(6) are not equivalent,” and the Ninth Circuit has “emphasized . . . that a federal court 

must find that a defendant was properly joined and remand the case to state court if there is a 

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‘possibility that a state court would find that the complaint states a cause of action against any of 

the [non-diverse] defendants.’” GranCare, LLC v. Thrower ex rel. Mills, 889 F.3d 543, 549 (9th 

Cir. 2018) (quoting Hunter, 582 F.3d at 1046) (alteration and emphasis added in GranCare). 

Accordingly, the Court must grant the motion “unless the defendant shows that the plaintiff would 

not be afforded leave to amend [the] complaint to cure [the] purported deficiency.” Rieger v. 

Wells Fargo Bank, Nat’l Ass’n, No. 3:13-0749-JSC, 2013 WL 1748045, at *3 (N.D. Cal. Apr. 23, 

2013) (second alteration in original) (citation and internal quotation marks omitted); see also

Macey v. Allstate Prop. & Cas. Ins. Co., 220 F. Supp. 2d 1116, 1117 (N.D. Cal. 2002) (stating that 

remand is proper where “there is a non-fanciful possibility that plaintiff can state a claim”).

III. ORDER TO SHOW CAUSE

In order to resolve any question of this court’s subject matter jurisdiction, the parties are 

ORDERED to meet and confer to determine whether Aguilar intends to pursue a claim against 

Abbey. If Aguilar does not wish to pursue such a claim, he may file notice of dismissal no later 

than April 18, 2019. If Aguilar declines to dismiss the claim, Defendants are ORDERED TO 

SHOW CAUSE why the case should not be remanded by filing a response to this order by April 

25, 2019, and Aguilar is ORDERED TO SHOW CAUSE why the claim against Abbey should not 

be dismissed by filing a response no later than May 2, 2019. If neither a notice of dismissal nor a 

response to this order is filed, the case will be remanded to state court for lack of subject matter 

jurisdiction.

IT IS SO ORDERED.

Dated: April 11, 2019

______________________________________

JOSEPH C. SPERO

Chief Magistrate Judge

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