Opinion
CASE NO. 16cv200-LAB (JLB)
02-18-2016
FELIX HERNANDEZ, et al., Plaintiffs, v. STATE FARM FIRE & CASUALTY COMPANY, et al., Defendants.
ORDER REQUIRING PLAINTIFF'S BRIEFING ON VENUE
On February 2, 2016, the Court ordered Plaintiffs to show cause why this putative class action should not be dismissed for lack of jurisdiction and improper venue. The Court is required to confirm its own jurisdiction, sua sponte if necessary, see Mt. Healthy City Sch. Dist. Bd. of Educ. v. Doyle, 429 U.S. 274, 278 (1977), and may also raise the issue of defective venue sua sponte where, as here, it has not been waived. See Costlow v. Weeks, 790 F.2d 1486 (9 Cir. 1986). The Order (Docket no. 6) cited particular jurisdictional and venue defects, and cautioned Plaintiffs that if they failed to show cause within the time permitted, this action would be dismissed both for lack of jurisdiction and improper venue.
Plaintiffs have now filed their response. (Docket no. 8.) Although the Order did not request or authorize Defendants to file their own briefing, two of them did so anyway. Their reasons for doing so are not clear, but they essentially repeat Plaintiffs' response and waive their own objections to personal jurisdiction and venue in this District. (See Docket nos. 9, 12.) They cannot, by consent, waive subject matter jurisdiction. See Commodity Futures Trading Comm'n v. Schor, 478 U.S. 833, 852 (1986). Nor can they waive other Defendants' objections to venue or personal jurisdiction. Royal Hawaiian Orchards, L.P. v. Olson, 2015 WL 3948821, at *1 (C.D. Cal., June 26, 2015) (citations omitted) (holding that, when there are multiple parties in an action, the plaintiff must establish that venue is proper as to each one). In other words, Plaintiffs and some of the Defendants cannot by agreement deprive other Defendants of their personal jurisdiction or venue rights. See Leroy v. Great Western United Corp., 443 U.S. 173, 180 (1979) (holding that personal jurisdiction and venue are privileges personal to a defendant).
Discussion
The Order addressed the Court's concerns in detail, and Plaintiffs were ordered to respond to those. This order incorporates by reference the Court's reasoning in its earlier Order, which is not repeated here except as necessary.
Jurisdiction
The Complaint, as filed, fails to allege ordinary diversity jurisdiction, and does not mention the Class Action Fairness Act (CAFA). Instead, it alleges that the amount in controversy exceeds $75,000 and only incompletely alleges citizenship. But it is clear that Plaintiffs are not diverse from at least four of the Defendants, so ordinary diversity jurisdiction is unavailable. The responses almost entirely ignore this. (See Pls.' Response, ¶¶ 1, 2(a) (explaining that Plaintiffs alleged an amount in controversy of over $75,000 because that is the threshold for traditional diversity jurisdiction).) The Court deems this issue abandoned.
The Complaint also fails to allege either citizenship or amount in controversy to establish jurisdiction under CAFA, 28 U.S.C. § 1332(d). Plaintiffs' response, however, attaches a proposed First Amended Complaint ("FAC") that makes clear Plaintiffs could allege minimal diversity and CAFA's threshold amount in controversy by amending. See 28 U.S.C. § 1332(d)(2). The Court therefore accepts that it can exercise subject matter jurisdiction over this controversy. / / /
Venue
Plaintiffs' response, with regard to venue, is inadequate. The Response itself merely refers to the FAC, which in turn does nothing to address the problems the Order identified, and fails to show that venue is proper here.
The underlying dispute arose from an insurance dispute on Plaintiffs' condominium, which suffered water damage. The condominium is located in, and Plaintiffs reside in, the Central District of California. Neither the Complaint nor the FAC ever allege that any events or omissions giving rise to Plaintiffs' claims occurred in this District, and the factual allegations make it highly likely all of the substantial events giving rise to Plaintiffs' claims occurred in the Central District. Because some of the Defendants reside or do business in this District, some of the events may have occurred here. But if so, Plaintiffs have failed to point them out.
The FAC cites 28 U.S.C. § 1391(b)(2) and (3) as giving rise to venue in this District. As the Order already pointed out, however, § 1391(b)(3) cannot apply here. It is the "fallback" provision, and applies only "if there is no district in which an action may otherwise be brought . . . ." As the Order explained, the Central District of California, where Plaintiffs' insured condominium is located, is at least one proper district, so § 1391(b)(3) is inapplicable. (See Order, 4:16-24.)
The other provision Plaintiffs rely on, § 1391(b)(2), provides that venue is proper in " judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of property that is the subject of the action is situated." As explained in the Order, that provision does not apply here either.
Defendant State Farm General Insurance's ("SFGI") Response (Docket no. 9) attempts to rescue Plaintiffs by arguing that venue is proper under § 1391(b)(1). But the FAC does not mention or rely on this provision, and as a Defendant, SFGI has no role in construing or amending the Complaint. If Plaintiffs wish to raise an argument that venue is proper on this basis, they should file a memorandum of points and authorities, explaining their position. This memorandum must address the residence of each Defendant, rather than combining multiple Defendants under a collective title (such as "State Farm"). Among other things, Plaintiffs' response must explain how Defendant State Farm Fire & Casualty Company satisfies the first and second prongs of the test set forth in Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9 Cir. 2004). They should also attach a proposed first amended complaint, in a legible form, as an exhibit. The memorandum must not exceed seven pages (not counting lodged or appended material) and must be filed no later than seven calendar days from the date this order is entered in the docket. A memorandum that does not meet these requirements will be rejected for filing. If Plaintiffs fail to show cause within the time permitted, this action will be dismissed without prejudice for improper venue.
No Defendant should file a response to this order, except that a Defendant who has not yet appeared may either waive or contest personal jurisdiction or venue, and any party may move for transfer pursuant to 28 U.S.C. § 1404(b). All requests for judicial notice are DENIED AS MOOT.
IT IS SO ORDERED. DATED: February 18, 2016
/s/_________
HONORABLE LARRY ALAN BURNS
United States District Judge