Opinion
NO. 2:10-CV-1505 FCD JFM.
July 14, 2010
MEMORANDUM AND ORDER
This matter is before the court on defendants' Allstate Corporation ("Allstate") and Lincoln Benefit Company's ("Lincoln") (collectively, "defendants") motion to dismiss plaintiffs' complaint pursuant to Federal Rule of Civil Procedure ("FRCP") 12(b)(6). In response, plaintiffs Douglas A. Haydel and Marsha M. Haydel ("plaintiffs") filed an opposition and a counter-motion to remand the matter to the Superior Court of the County of San Joaquin. Defendants oppose the counter-motion. For the reasons set forth below, plaintiffs' counter-motion to remand is GRANTED.
Because oral argument will not be of material assistance, the court orders this matter submitted on the briefs. E.D. Cal. L.R. 230(g).
This case was removed on June 17, 2010 from the Superior Court of California, County of San Joaquin, to the United States District Court for the Eastern District of California by defendants under 28 U.S.C. §§ 1441 based on diversity jurisdiction. Plaintiffs' complaint alleges causes of action for breach of contract, breach of covenant of good faith and fair dealing, and declaratory relief. Defendants removed the case, asserting that the amount in controversy exceeded $75,000. Specifically, under the Second Cause of Action, plaintiffs seek "actual and consequential damages of $50,000, together with interest at the legal rate from and after April 16, 2010," and under the Third Cause of Action, plaintiffs seek "actual and consequential damages, including attorney fees, of $70,000 plus interest." (Compl., Ex. A to Notice of Removal, filed June 17, 2010, at 5.)
In a declaration accompanying the Motion to Remand, plaintiffs' counsel clarified that he intentionally limited the damages sought in this case to an amount not to exceed $70,000. (Decl. of Douglas A. Haydel in Support of Counter-Motion to Remand, filed July 2, 2010.) Specifically, counsel stated that the damages sought in the second cause of action for breach of contract in an amount not to exceed $50,000 are the same damages sought in the third cause of action coupled with a claim for emotional distress, which is not to exceed $20,000. As such, plaintiffs expressly concede that "the total amount recoverable on any and all causes of action does not exceed $70,000, and there can be no recovery on this complaint in a sum in excess of $70,000." (Id.)
Jurisdiction is a threshold inquiry before the adjudication of any case before the court. See Morongo Band of Mission Indians v. Cal. State Bd. of Equalization, 858 F.2d 1376, 1380 (9th Cir. 1988). Without jurisdiction, this court cannot adjudicate the merits of this case or order any relief. See id. ("If the district court had no jurisdiction over the subject matter, the action should have been dismissed, regardless of the parties' preference for an adjudication in federal court.").
In this case, based upon the express concession in plaintiffs' counsel's declaration, the amount in controversy in this litigation does not exceed the sum of $75,000. Therefore, this action is improperly before this court. Accordingly, the court REMANDS this action to the Superior Court of California, County of San Joaquin.
Plaintiffs request attorneys' fees pursuant to 28 U.S.C. § 1447(c), which provides for the recovery of fees where "the removing party lacked an objectively reasonable basis for removal." Martin v. Franklin Capital Corp., 546 U.S. 132, 141 (2005). Because it was not clear from the face of the complaint that plaintiffs sought a maximum recovery of $70,000, defendants had an objectively reasonable basis for removal. As such, plaintiffs' request for fees is DENIED.
IT IS SO ORDERED.