Court Opinion

ID: 1038531
Source: CourtListenerOpinion
Date Created: 2013-08-28 00:02:36.071209+00
Date Added: 2024-06-11T12:47:25.737896
License: Public Domain

FILED
                           NOT FOR PUBLICATION                             AUG 27 2013

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

VICTOR GARIBAY, individually and on              No. 13-56151
behalf of other members of the general
public similarly situated,                       D.C. No. 2:12-cv-10640-PA-VBK

              Plaintiff - Appellee,
                                                 MEMORANDUM*
  v.

ARCHSTONE COMMUNITIES LLC, a
Delaware limited liability company;
ARCHSTONE PROPERTY
MANAGEMENT CALIFORNIA
INCORPORATED, a Delaware
corporation,

              Defendants - Appellants.

                    Appeal from the United States District Court
                       for the Central District of California
                     Percy Anderson, District Judge, Presiding

                            Submitted August 7, 2013**
                               Pasadena, California

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
        **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Before: SILVERMAN and WARDLAW, Circuit Judges, and CEDARBAUM,
Senior District Judge.***

      Archstone Communities, LLC and Archstone Property Management

California, Inc. appeal the district court’s order granting Victor Garibay’s motion

to remand his class action complaint, which alleges violations of various California

wage and employment laws, to state court. We have jurisdiction under 28 U.S.C.

§ 1453(c), and we affirm.

      The district court correctly held that the defendants did not meet their burden

to prove by a preponderance of the evidence that the amount in controversy

exceeds $5 million as required for federal jurisdiction under the Class Action

Fairnesss Act, 28 U.S.C. § 1332(d). See Abrego Abrego v. The Dow Chem. Co.,

443 F.3d 676, 685 (9th Cir. 2006) (per curiam). The only evidence the defendants

proffer to support their calculation of the amount in controversy is a declaration by

their supervisor of payroll, which sets forth only the number of employees during

the relevant period, the number of pay periods, and general information about

hourly employee wages. Beyond this, the defendants rely on speculative and self-

serving assumptions about key unknown variables. The district court correctly

        ***
             The Honorable Miriam Goldman Cedarbaum, Senior District Judge
for the U.S. District Court for the Southern District of New York, sitting by
designation.

                                         -2-
concluded that Archstone’s evidence was insufficient to support removal

jurisdiction under CAFA.

      For example, Garibay alleged violations of Cal. Labor Code § 226, which

provides that employers who fail to provide employees with “an accurate itemized

[wage] statement” are subject to fines. Archstone’s calculations assume that every

single member of the class would be entitled to recover penalties for every single

pay period. Garibay also alleges violations of Cal. Labor Code § 203, which

provides that employers who fail to timely pay all earned wages upon termination

are subject to a fine equal to the employee’s normal wages for each day the wages

are late, up to a maximum of 30 days. Archstone assumes that each employee

would be entitled to the maximum statutory penalty, but provides no evidence

supporting that assertion. Along the same lines, Garibay alleged violations of Cal.

Labor Code § 226.7, which provides that employers who fail to provide adequate

meal or rest breaks must compensate the employee for an additional hour of pay.

Archstone assumes that each class member was wrongly denied a break twice each

week. As the district court correctly explained, Archstone failed to provide any

evidence regarding why the assumption that each employee missed two rest

                                         -3-
periods per week was more appropriate than “one missed rest period per paycheck

or one missed rest period per month.” Although Archstone correctly notes that

25% recovery is the “benchmark” level for reasonable attorney’s fees in class

action cases, see Hanlon v. Chrysler Corp., 150 F.3d 1011, 1029 (9th Cir. 1998),

and that such fees are properly included in calculations of the amount in

controversy, see Lowdermilk v. U.S. Bank Nat’l Ass’n, 479 F.3d 994, 1000 (9th

Cir. 2007); Cal. Labor Code § 218.5, Archstone has not established by a

preponderance of the evidence that the underlying amount upon which those fees

would be based is at least $4 million, as would be required to meet the $5 million

minimum.

         Finally, although the district court cited to Lowdermilk, 479 F.3d at 1002,

which applied the heightened “legal certainty” standard, it relied on that case for

the general proposition that we may not base our jurisdiction on mere speculation.

Contrary to Archstone’s assertions, the district court correctly identified and

applied the preponderance of the evidence standard.

         When it initially sought removal, Archstone did not have the benefit of our

decision in Roth v. CHA Hollywood Med. Ctr., __F.3d__ [2013 WL 3214941] (9th

Cir. 2013). Under Roth, if Archstone later discovers evidence that the

jurisdictional bar is met, it may once again attempt to remove this case to federal

court.

                                           -4-
AFFIRMED.

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