Opinion ID: 4026322
Heading Depth: 2
Heading Rank: 2

Heading: The Futility Doctrine and the CLRA

Text: Innoventions also argues that despite the literal words of § 1447(c), a district court may dismiss a removed case without remanding it back to state court if remand would be futile. This argument finds some support in our precedents. See Bell v. City of Kellogg, 922 F.2d 1418, 1425 (9th Cir. 1991). However, the Bell rule has been questioned, and may no longer be good law. Importantly here, even if it remains good law, remand would not be futile under the Bell standard. In International Primate Protection League v. Administrators of Tulane Educational Fund, decided a few months after we decided Bell, the Supreme Court declined to apply a futility exception to the remand rule. 500 U.S. 72, 3 Indeed, the record shows that the district court made its determination on May 1, 2014, but entered judgment almost two weeks later on May 12, 2014. 10 POLO V. INNOVENTIONS INT’L 88–89 (1991). Although the Court did not reject the futility doctrine outright, it did take note of “the literal words of § 1447(c), which, on their face, give no discretion to dismiss rather than remand an action.” Id. at 89 (quotation marks and alteration omitted). In the wake of International Primate, a number of other circuits have expressly rejected the futility doctrine. See Hill v. Vanderbilt Capital Advisors, LLC, 702 F.3d 1220, 1225–26 (10th Cir. 2012) (collecting cases). But Polo has not argued that Bell is no longer controlling law, and we decline to so hold sua sponte. Cf. Miller v. Gammie, 335 F.3d 889, 899 (9th Cir. 2003) (considering when a panel may overrule prior circuit authority). Even applying the Bell rule, however, a district court must have “absolute certainty” that a state court would “simply dismiss[] the action on remand.” 922 F.2d at 1425 (quotation marks omitted). In other words, only when the eventual outcome of a case after remand is so clear as to be foreordained have we held that a district court may dismiss it—to “prevent[] any further waste of valuable judicial time and resources.” Id. It is far from clear that a state court would dismiss Polo’s CLRA claim. A plaintiff who purchased goods in light of deceptive practices has standing to sue pursuant to the CLRA if she alleges (a) that she purchased a product from the defendant, and (b) that “the purchase would not have been made but for the misrepresentation.” Kwikset Corp. v. Superior Court, 246 P.3d 877, 890 (Cal. 2011); see also Hinojos v. Kohl’s Corp., 718 F.3d 1098, 1108 (9th Cir. 2013). The injury Polo asserts with respect to her CLRA claim fits these requirements: POLO V. INNOVENTIONS INT’L 11 Plaintiff and California Class members suffered injuries caused by Defendants’ misrepresentations about DiabeStevia because: (a) Plaintiff and the California Class members would not have purchased DiabeStevia on the same terms had they known the true facts; (b) Plaintiff and the California Class paid a premium price due to the false and misleading advertising of DiabeStevia; and (c) DiabeStevia did not have the level of safety, quality, effectiveness or value as promised. Polo’s standing to bring her CLRA claim does not depend upon her allegation that taking DiabeStevia made her diabetes worse. Indeed, with respect to Polo’s CLRA claim, when Polo ceased taking her diabetes medication—or whether she had diabetes at all4—is irrelevant. What matters are her allegations that she thought she had diabetes; that Innoventions marketed DiabeStevia as a treatment for diabetes; and that but for that marketing, she would not have bought DiabeStevia. Were that the end of the allegations, Polo would likely have standing under Article III. See Hinojos, 718 F.3d at 1104 n.3. But the district court held that because Innoventions fully compensated Polo for “her entire purchase price,” her 4 Whether or not Polo actually had or has diabetes is unclear. Polo was at one point in time diagnosed with diabetes and prescribed diabetes medication. Some time later—the timeline is vague—she was told either that her symptoms had been brought under control or that she was no longer diabetic. 12 POLO V. INNOVENTIONS INT’L CLRA claim is moot.5 Under California law, however, that sort of “picking off” of class plaintiffs is ineffective: “[O]nce a person has been the victim of a proscribed practice under the CLRA and makes a demand on behalf of a class, remedying the plaintiff’s individual complaint does not disqualify her as class representative.” Meyer v. Sprint Spectrum, L.P., 200 P.3d 295, 300 (Cal. 2009). Instead, to defeat a class action based on practices proscribed under the CLRA, the defendant “must adequately notify the members of the class and provide an opportunity for an appropriate remedy for the defective goods or services.” Id. (citing Cal. Civ. Code § 1782(c)). Polo made a demand on behalf of a class on April 6, 2012. Innoventions refunded Polo’s purchase price on May 11, 2012, but does not contend that it provided the notice and remedy to class members required by the CLRA. See Cal. Civ. Code § 1782(c); Meyer, 200 P.3d at 300. Thus, Polo likely retains standing under California law. At a minimum, we cannot say with “absolute certainty” that remand would be futile. Therefore, the district court should have remanded this case to state court pursuant to 28 U.S.C. § 1447(c).