Grow v. JetBlue Airways Corp.

1

STEPHANIE LA GROW, Plaintiff, v. JETBLUE AIRWAYS CORPORATION and DOES 1 through 50, inclusive, Defendants.

No. 2:24-cv-00518-ODW (SKx)

United States District Court, C.D. California

July 3, 2024

ORDER DENYING MOTION TO REMAND [17]

OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE

I. INTRODUCTION

On November 27, 2023, Plaintiff Stephanie La Grow filed this putative Class Action Complaint in the Superior Court of the State of California, County of Los Angeles, against her employer, JetBlue Airways Corporation. (Notice of Removal (“NOR”) Ex. A (“Compl.”), ECF No 1-1.) On January 19, 2023, JetBlue removed the instant action on the basis that this Court has jurisdiction under the Class Action Fairness Act (“CAFA”), 28 U.S.C §§ 1332(d) and 1453, and the separate, independent, and alternative ground for removal under 28 U.S.C. § 1332(a). (NOR 1.) La Grow now moves to remand this action for lack of subject matter jurisdiction.

(Mot. Remand (“Motion” or “Mot.”), ECF No. 17.) For the reasons below, the Court DENIES La Grow's Motion.^[1]

II. BACKGROUND

La Grow, a JetBlue employee in California, brings this class action on behalf of other current and former California JetBlue employees to fully compensate class members for losses allegedly incurred due to JetBlue's “policy and practice” of failing to lawfully compensate these employees. (Compl. ¶ 5.) La Grow alleges that Defendant failed to fully pay employees for all time worked, pay overtime and meal and rest break premiums, include incentive compensation per JetBlue's non-discretionary incentive program, provide all required meal and rest breaks, accurately record and pay employees for the actual amount of time worked, provide complete and accurate wage statements, pay all waiting time penalties, pay all sick pay wages, reimburse and indemnify employees for required business expenses, or provide suitable seating. (See id. ¶¶ 8-27.)

La Grow brings eight claims stemming from JetBlue's alleged violations of the California Labor Code: (1) violation of the Unfair Competition Law; (2) failure to pay all state minimum wages; (3) failure to pay overtime wages; (4) failure to provide meal periods and pay meal period premiums; (5) failure to provide rest periods and pay rest period premiums; (6) failure to provide accurate itemized wage statements; (7) failure to reimburse required business expenses; and (8) failure to pay sick pay wages. (See Compl. ¶¶ 49-114.) For the first cause of action, La Grow seeks to represent all current and former non-exempt employees of JetBlue, including any employees staffed with Defendant by a third party (the “California Class”), whom JetBlue employed in California at any time “during the period beginning four (4) years prior” to the filing of the Complaint (the “California Class Period”).^[2] (Id. ¶ 30.)

For the Second through Eighth causes of action, La Grow seeks to represent all members of the California Class “at any time during the period three (3) years prior to the filing of the complaint” (the “California Labor Sub-Class Period”).^[3] (Id. ¶ 40.)

On January 19, 2023, JetBlue removed the action to federal court based on alleged CAFA subject matter jurisdiction and the separate, independent, and alternative ground for removal under diversity jurisdiction pursuant to 28 U.S.C. § 1332(a). (NOR ¶¶ 10, 62.) Now, La Grow moves to remand the action back to state court on the basis that the aggregate amount in controversy does not meet CAFA's $5,000,000 jurisdictional threshold or § 1332(a)'s $75,000 threshold. (See generally Mot.) The Motion is fully briefed. (Opp'n, ECF No. 18; Reply, ECF No. 19.)

III. LEGAL STANDARD

Federal courts have subject matter jurisdiction only as authorized by the Constitution and Congress. U.S. Const. art. III, § 2, cl. 1; Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Under 28 U.S.C. § 1441(a), a party may remove a civil action brought in a state court to a district court only if the plaintiff could have originally filed the action in federal court. Federal district courts have original jurisdiction where an action arises under federal law, or where each plaintiff's citizenship is diverse from each defendant's citizenship (i.e., diversity is “complete”), and the amount in controversy exceeds $75,000. 28 U.S.C. §§ 1331, 1332(a).

There is a strong presumption that a court is without jurisdiction until affirmatively proven otherwise. See Fifty Assocs. v. Prudential Ins. Co. of Am., 446 F.2d 1187, 1190 (9th Cir. 1970); Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (“Federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance.”). When an action is removed from state court, the removing party bears the burden of demonstrating that removal is proper. Gaus, 980 F.2d at 566. Thus, removal jurisdiction is strictly construed, and any doubt as to the propriety of removal is to be resolved in favor of remand. Id.

CAFA provides federal courts with jurisdiction over a purported class action if all of the following requirements are met: (1) the amount in controversy exceeds $5 million, (2) at least one putative class member is a citizen of a state different from any defendant, and (3) the putative class exceeds 100 members. 28 U.S.C. §§ 1332(d)(2)(5). The removing defendant bears the burden of establishing federal jurisdiction, “including any applicable amount in controversy requirement.” Abrego V. Dow Chem. Co., 443 F.3d 676, 682-83 (9th Cir. 2006) (quoting Gaus, 980 F.2d at 566). However, unlike cases removed under diversity jurisdiction, “no antiremoval presumption attends cases invoking CAFA.” Dart Cherokee Basin Operating Co., LLC V. Owens, 574 U.S. 81, 89 (2014).

Although “a defendant's notice of removal need include only a plausible allegation that the amount in controversy exceeds the jurisdictional threshold,” when the allegation is challenged, “[e]vidence establishing the amount is required.” Id. “[B]oth sides submit proof,” and the court decides whether the defendant has demonstrated, by a preponderance of the evidence, that the amount in controversy requirement has been satisfied. Id. at 88. Such evidence may include “affidavits or declarations, or other summary-judgment-type evidence relevant to the amount in controversy at the time of removal.” Ibarra V. Manheim InVs., Inc., 775 F.3d 1193, 1197 (9th Cir. 2015) (internal quotation marks omitted) (quoting Singer V. State Farm Mut. Auto. Ins. Co., 116 F.3d 373, 377 (9th Cir. 1997)). Whether the defendant meets its burden of demonstrating the amount in controversy is “to be tested by consideration of real evidence and the reality of what is at stake in the litigation, using reasonable assumptions underlying the defendant's theory of damages exposure.” Id. at 1198. “[M]ere speculation and conjecture, with unreasonable assumptions” does not suffice. Id. at 1197.

IV. DISCUSSION

This jurisdictional inquiry concerns whether the amount in controversy exceeds $5,000,000, as required by CAFA, or, in the alternative, $75,000 as required by 28 U.S.C. § 1332(d)(2)(A). The amount in controversy is simply “the amount at stake in the underlying litigation.” Jauregui v. Roadrunner Transp. Servs., 28 F.4th 989, 994 (9th Cir. 2022) (quoting Theis Rsch., Inc. v. Brown & Bain, 400 F.3d 659, 662 (9th Cir. 2005)). It “does not mean likely or probable liability; rather, it refers to possible liability.” Greene v. Harley-Davidson, Inc., 965 F.3d 767, 772 (9th Cir. 2020); see also Lewis v. Verizon Commc'ns, Inc., 627 F.3d 395, 400 (9th Cir. 2010) (noting that the amount in controversy is “an estimate of the amount that will be put at issue in the course of the litigation” (citing McPhail v. Deere & Co., 529 F.3d 947, 956 (10th Cir. 2008))).

La Grow challenges JetBlue's amount in controversy calculations on both removal bases, so the Court first addresses CAFA before turning to diversity jurisdiction under § 1332(a).

A. CAFA

The parties do not dispute the minimum diversity or numerosity elements of CAFA. Accordingly, the only issue is whether JetBlue has shown, by a preponderance of the evidence, that the amount in controversy exceeds CAFA's $5,000,000 jurisdictional threshold.

In its Opposition, JetBlue calculates an amount in controversy of $11,144,606.50. (Opp'n 7.) La Grow does not allege a specific amount of damages in the Complaint, but states that the aggregate damages for Class claims is below CAFA's $5,000,000 threshold required for federal jurisdiction. (Compl. ¶ 4.) In arguing for remand, La Grow asserts that JetBlue: (1) uses unreasonable violation rates for each of her claims, and (2) fails to support its calculations with summaryjudgment-type evidence. (See generally Mot.; Reply to Opp'n.) She contends that, as a consequence, JetBlue does not meet its burden of proof that the amount in controversy exceeds $5,000,000. The Court first addresses the reasonableness of JetBlue's violation rates in determining the amount in controversy, then addresses whether JetBlue's calculations are supported by sufficient and competent evidence.

1. Violation Rate

To determine whether an action meets CAFA's amount in controversy threshold, “courts first look to the complaint.” Ibarra, 775 F.3d at 1197. In assessing the amount in controversy, a removing defendant is permitted to rely on “a chain of reasoning that includes assumptions.” Id. at 1199. Such “assumptions cannot be pulled from thin air but need some reasonable ground underlying them,” founded on the allegations in the complaint. Id. at 1198-99.

To examine the reasonableness of an assumed violation rate “the Ninth Circuit distinguishes between complaints of ‘uniform' violations and those alleging a ‘pattern and practice' of labor law...