Zeto v. BMW of N. Am., LLC

NIERAN ZETO, Plaintiff, v. BMW OF NORTH AMERICA, LLC; and DOES 1 to 10, Defendants.

Case No.: 20-cv-1380-GPC-KSC

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA

November 16, 2020

ORDER (1) DENYING MOTION TO REMAND; (2) GRANTING LEAVE TO AMEND COMPLAINT; AND (3) GRANTING MOTION TO COMPEL ARBITRATION AND STAY ACTION

[ECF Nos. 11, 16, 19]

Before the Court are three motions: (1) Plaintiff's Motion to Remand, ECF No. 11; (2) Plaintiff's Motion for Leave to File Amended Complaint, ECF No. 16; and (3) Defendant BMW of North America, LLC ("Defendant" or "BMW NA")'s Motion to Compel Arbitration and to Stay Action, ECF No. 19. Upon consideration of the motions, the related documents, and relevant law, the Court DENIES Plaintiff's request for remand; GRANTS leave to file an amended complaint and ORDERS the proposed amended complaint, ECF No. 16-2 at 13-19, to be deemed filed as the First Amended Complaint ("FAC"); and GRANTS Defendant's motion to compel arbitration and STAYS all proceedings in this action until arbitration is completed.

I. BACKGROUND

On or about October 13, 2017, Plaintiff purchased/leased ("purchased") a vehicle that was manufactured by BMW NA. Compl. ¶ 5, ECF No. 1-2. BMW NA provided a written express warranty on the vehicle. Id. ¶ 6. Plaintiff alleges that during the warranty period, the vehicle had substantial defects, and that despite Plaintiff requesting a repurchase, BMW NA failed to successfully repair the vehicle or replace it. Id. ¶¶ 7, 8.

On February 18, 2020, Plaintiff filed her Complaint in the Superior Court of California, County of San Diego, North County Division, which BMW NA removed to federal court on July 20, 2020 once the state court dismissed co-defendant Irvine Eurocars LLC d/b/a Irvine BMW on June 19, 2020. BMW NA's Notice of Removal, ECF No. 1 at 2-3. The Complaint alleges seven causes of action: (1-3) violations of the Song-Beverly Consumer Warranty Act ("Song-Beverly Act"); (4) breach of express warranties under the California Commercial Code; (5) breach of implied warranties; (6) violation of the Magnuson-Moss Warranty Act ("Magnuson-Moss Act"); and (7) violation of the California Business and Professions Code. Compl. 2-9, ECF No. 1-2.

On August 19, 2020, Plaintiff filed a Motion to Remand the case back to the state court. ECF No. 11. Defendant filed a Response in Opposition to Plaintiff's Motion to Remand the case, which Plaintiff filed a Reply. ECF Nos. 21, 25.

Plaintiff also filed a Motion for Leave to File Amended Complaint on August 28, 2020. ECF No. 16. According to Plaintiff, the proposed FAC re-dismisses Irvine BMW, and removes the original counts 3, 4, and 6. "Plaintiff remains focus [sic] on pursuing the allegations revolving around Defendant's violations of California's Song Beverly Consumer Warranty Act and Business and Professions Code." Id. at 2. While Defendant notified the Court that Defendant does not object to Plaintiff filing an amended complaint, Defendant stated, among others, that the proposed FAC "silently and withoutexplanation removes Plaintiff's allegation related to her citizenship." BMW NA's Notice of Non-Opp'n 2, ECF No. 22.

On September 9, 2020, BMW NA filed a Motion to Compel Arbitration and to Stay Action ("MTC"). ECF No. 19. Defendant states that the Motion is made pursuant to the "Arbitration Clause" that is contained in the Motor Vehicle Lease Agreement, which Plaintiff signed in purchasing the vehicle. Id. at 2. Plaintiff filed a Response opposing the MTC, and Defendant filed a Reply. ECF Nos. 24, 25.

II. JUDICIAL NOTICE

The Court HEREBY TAKES judicial notice of the Motor Vehicle Lease Agreement ("Lease Agreement"), the BMW Financial Services Consumer Credit Application ("Credit Application"), and Plaintiff's California Driver's License ("Driver's License"). BMW NA's Req. for Judicial Notice, ECF No. 21. Relatedly, the Court OVERRULES Plaintiff's objections pertaining to these three documents. "The court may judicially notice a fact that is not subject to reasonable dispute because it . . . can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." Fed. R. Evid. 201(b).

Here, the Lease Agreement is judicially noticeable because even if it is not explicitly attached to the complaint, it is integral to Plaintiff's claims and its authenticity is not questioned. See Swartz v. KPMG LLP, 476 F.3d 756, 763 (9th Cir. 2007). The Lease Agreement is integral to the complaint, as the original complaint states: "On or about October 13, 2017, Plaintiff purchased/leased (hereinafter referred to as 'purchased') 2018 BMW 530E, vehicle identification number WBAJA9C54JB033423, (Vehicle)." Compl. ¶ 5, ECF No. 1-2; see also FAC ¶ 4, ECF No. 16-2. The Lease Agreement's authenticity is not contested. In fact, Plaintiff attached a carbon copy of it when opposing arbitration. Decl. of Nieran Zeto ("Zeto Decl.") Ex. 1, ECF No. 24-2.

The Credit Application is also judicially noticeable. The information contained in it, such as Plaintiff's name, city and state of residence, and signature, "can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." Fed. R. Evid. 201(b). Plaintiff's Objection to Judicial Notice, ECF No. 11-4, does not address this document. Rather, Plaintiff makes boilerplate evidentiary objections, see Pl.'s Obj. of Evid. 3, ECF No. 11-3, which the Court rejects as being devoid of any specific argument or analysis as to why the document should be excluded. See Ferguson v. United States, No. 15CV1253 JM (MDD), 2018 WL 3570283, at *2 (S.D. Cal. July 25, 2018), aff'd, 792 F. App'x 494 (9th Cir. 2020).

Finally, the Driver's License is judicially noticeable as true and correct copies of "matters of public record." See United States v. 14.02 Acres of Land, 547 F.3d 943, 955 (9th Cir. 2008).

III. REMAND TO STATE COURTS

The Court first addresses whether it has jurisdiction over the case. Defendant removed the case to federal court, and Plaintiff moved to remand it back to state court. Notice of Removal, ECF No. 1; Mot. to Remand, ECF No. 11. A federal district court has jurisdiction over any civil action under the diversity jurisdiction statute if complete diversity exists between the parties and the amount in controversy exceeds $75,000. 28 U.S.C. § 1332. The nature of limited jurisdiction in federal courts and comity principles mean that the defendant has the burden of proof. See Moore-Thomas v. Alaska Airlines, Inc., 553 F.3d 1241, 1244 (9th Cir. 2009); Harris v. Bankers Life & Cas. Co., 425 F.3d 689, 698 (9th Cir. 2005).

Based on the state court complaint as the operative complaint and additional evidentiary support, Defendant has sufficiently demonstrated that this Court has diversity jurisdiction over the matter, and that removal to federal court was proper. Complete diversity exists. BMW NA is a citizen of Delaware and New Jersey. The originalcomplaint and various evidentiary exhibits all demonstrate that Plaintiff is domiciled in California. The amount in controversy is met as well. Based on the causes of action in the complaint and Plaintiff's Initial Disclosures with specific monetary demands, it is evident that the amount in dispute is greater than $75,000. With multiple evidentiary sources that support removal, and scant—if not zero—evidence to the contrary by Plaintiff, Defendant has met the burden of persuasion. Accordingly, the Court DENIES Plaintiff's Motion to Remand.

A. Operative Complaint

To start, the Court conducts its jurisdiction analysis based on the original complaint that was filed in state court, and not the proposed amended complaint. "[P]ost-removal amendments to the pleadings cannot affect whether a case is removable, because the propriety of removal is determined solely on the basis of the pleadings filed in state court." Williams v. Costco Wholesale Corp., 471 F.3d 975, 976 (9th Cir. 2006). "Any other ruling would enable plaintiffs to, upon the realization that their litigation has taken a sour turn in federal court, use a post-removal damage stipulation to remand their case after the parties and the court have invested extensive time and resources." Gillette v. Peerless Ins. Co., No. CV 13-03161 DDP RZX, 2013 WL 3983872, at *3 (C.D. Cal. July 31, 2013). BMW NA removed the case on July 20, 2020, and Plaintiff moved to amend the complaint afterwards on August 28, 2020. Since the motion to amend the complaint was filed after BMW NA's motion for removal, the original complaint filed in state court is the operative document for the Court's review for remand.

B. Complete Diversity

Complete diversity exists because for purposes of diversity jurisdiction, Defendant BMW NA is a citizen of Delaware and New Jersey, and Plaintiff is domiciled in California. First, the Court agrees with BMW NA's uncontested explanation for why it is not a California citizen. Unnamed defendants are disregarded for purposes of removal,28 U.S.C. § 1441(b)(1), and BMW NA, the only named defendant, is a limited liability company. For diversity jurisdiction purposes, a limited liability company is a citizen of every state where its owners/members are citizens. Johnson v. Columbia Properties Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006). The sole member of BMW NA is BMW (US) Holding Corp., which is organized under Delaware law with its principal place of business in New Jersey. Since BMW (US) Holding Corp. is a citizen of Delaware and New Jersey, see 28 U.S.C. § 1332(c)(1) ("[A] corporation shall be deemed to be a citizen of every State . . . by which it has been incorporated and . . . where it has its principal place of business"), BMW NA is also a citizen of Delaware and New Jersey.

In addition, Defendant has produced sufficient evidence for the Court to conclude that Plaintiff is domiciled in California. In analyzing diversity jurisdiction, a person's state citizenship status is determined by where the natural person is domiciled,¹ which is the person's ...