Stone v. Popout Inc.
- James Donato
- 3:21-cv-02090
- U.S. District Court · Northern District of California
- 4
In Stone v. Popout Inc., Judge Donato ordered Jack Stone to explain why the case should not be dismissed for lack of subject-matter jurisdiction.
Jack Stone and the defendants, Popout Inc. and DHL Freight USA Inc.; the order required Stone to address whether the federal court had jurisdiction over his claims.
What happened
In Stone v. Popout Inc., Jack Stone, representing himself, sued Popout Inc. and DHL Freight USA Inc. over a damaged surfboard shipment to Japan. He alleged breach of contract, negligence, and fraudulent misrepresentation.
The court questioned whether it had diversity jurisdiction because the complaint did not adequately allege the parties’ citizenship and did not support the claimed amount in controversy of $75,000.01. The alleged damages appeared to total only $1,280.26.
Judge James Donato ordered Stone to file a written explanation by May 26, 2021, showing why the case should not be dismissed for lack of subject-matter jurisdiction. The order did not itself dismiss the case.
The detailed version
- Stone v. Popout Inc. · No. 3:21-cv-02090
- James Donato
- May 12, 2021
Background
Jack Stone filed a complaint and an application to proceed without paying the filing fee. The court granted that application but said it would separately decide whether the complaint should be served.
Stone alleged that he contracted with Popout, Inc., doing business as Shippo, to ship a surfboard and accessories to his residence in Sendai, Japan. He alleged that DHL Freight USA, Inc. acted as Shippo’s agent. A third party delivered the items in badly damaged condition, and Stone alleged that the surfboard was destroyed beyond repair. He claimed that the defendants failed to process his damage claims or reimburse him. The complaint appeared to assert breach of contract, negligence, and fraudulent misrepresentation.
Jurisdictional Concerns
The court explained that federal courts have limited jurisdiction and that Stone appeared to rely on diversity jurisdiction because his claims were based on state law. Diversity jurisdiction generally requires that all plaintiffs be citizens of different states from all defendants and that more than $75,000 be in dispute.
The complaint alleged that Stone resided in Japan, that Shippo was headquartered in San Francisco, and that DHL did business in San Francisco. But it did not allege Stone’s citizenship or domicile, the citizenship of either defendant, or facts showing that any party was a citizen or subject of a foreign state. The court also noted that a corporation’s citizenship generally includes its state of incorporation and its principal place of business.
The court separately questioned the amount in controversy. Stone alleged that $75,000.01 was at stake, but his claim attached to the complaint sought $724.94 from DHL. Even including the purchase price of the surfboard and accessories and all shipping charges, the potential damages appeared to total $1,280.26—far below the required jurisdictional minimum. The complaint did not explain the basis for the $75,000.01 figure.
Order
The court ordered Stone to show cause in writing by May 26, 2021, why the action should not be dismissed for lack of subject-matter jurisdiction. The order stated that the matter would be dismissed if he did not file the required response. The order itself was an order to show cause; it did not state that the case had already been dismissed.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.