Magdalasov v. ByteDance Inc.

Background

ByteDance Inc. removed the case from the Supreme Court of New York, New York County. After removal, Yakov Magdalasov amended his complaint twice. Magdalasov was proceeding without a lawyer. He moved to remand, meaning to return the case to state court, and separately sought a temporary restraining order and preliminary injunction.

The requested emergency relief would have prevented ByteDance from terminating Magdalasov while the case was pending, required ByteDance to place him on paid administrative leave or keep him on its payroll, and required ByteDance to process his short-term disability appeal.

Remand and Federal Jurisdiction

The court denied the motion to remand. It evaluated ByteDance’s right to remove the case based on the allegations in the state-court complaint as they existed when the removal notice was filed. The court also construed Magdalasov’s filings liberally because he was proceeding without a lawyer.

ByteDance asserted both diversity jurisdiction and federal-question jurisdiction. The court decided that diversity jurisdiction was sufficient and therefore did not address federal-question jurisdiction.

For diversity jurisdiction, the amount in controversy generally must exceed $75,000, and the parties must meet the citizenship requirements in 28 U.S.C. § 1332. Although Magdalasov stipulated that he was not seeking damages above $75,000 for purposes of the jurisdictional analysis, the court measured the value of the requested employment-related relief. Magdalasov’s documents showed a $202,000 annual salary and a target annual bonus of 25% of base salary. The court concluded that maintaining his employment was clearly worth more than $75,000 to him, even without counting restricted share units or employment benefits.

Magdalasov identified himself as a Russian citizen with asylee status in the United States. He acknowledged that ByteDance was incorporated in Delaware and had its principal place of business in California. The court treated ByteDance as a citizen of Delaware and California. It rejected Magdalasov’s argument that ByteDance’s foreign parent and foreign executive team made ByteDance a foreign citizen for this purpose. The court found complete diversity between Magdalasov and ByteDance.

The court also rejected Magdalasov’s argument that the timing of removal showed bad faith. Because the motion to remand was denied, the court denied his request for fees under 28 U.S.C. § 1447(c).

Temporary Restraining Order and Preliminary Injunction

The court denied the motion for a temporary restraining order and preliminary injunction. It applied the same standard to both forms of relief. Magdalasov had to show, among other things, that he was likely to suffer irreparable harm without the requested relief. Irreparable harm means harm that cannot ordinarily be repaired through a later award of money.

Magdalasov identified termination or continued exclusion without pay during medically supported leave, income loss, difficulty completing the leave-extension process, and psychological distress allegedly caused by retaliatory actions. The court held that the ordinary economic effects of losing employment generally do not qualify as irreparable harm because they can typically be compensated with money. It also held that Magdalasov’s allegations of emotional harm were vague and conclusory and therefore insufficient.

Disposition

The court denied the motion to remand and denied the motion for a temporary restraining order and preliminary injunction. It directed the Clerk of Court to terminate the listed motions and to modify the case caption to reflect Magdalasov’s spelling of his name. The court certified that any appeal would not be taken in good faith and denied free filing status for purposes of an appeal.