Gonzales v. Costco Wholesale Corporation

Background

Costco Wholesale Corporation removed this action from the California Superior Court for Alameda County on November 3, 2021. Costco asserted federal diversity jurisdiction under 28 U.S.C. § 1332(a). Diversity jurisdiction generally requires the opposing parties to be citizens of different states.

The opinion states that Elizabeth Brambila shares California citizenship with Plaintiff Daniel Gonzales and did not join in the removal. Costco argued that Brambila was not properly served, was not working at the store involved on the day of the accident, and was fraudulently joined as a defendant. “Fraudulent joinder” is a removal term describing a situation in which a plaintiff cannot state a viable claim against a non-diverse defendant under settled state-law rules; it does not, by itself, mean that the plaintiff or counsel intended to deceive anyone.

Court’s analysis

The court explained that doubts about whether a claim is adequately pleaded must be resolved in favor of sending the case back to state court. It also stated that remand is required unless the defendant shows that the plaintiff would not be allowed to amend the complaint to correct the alleged deficiency.

The court found that no apparent basis for federal subject-matter jurisdiction existed apart from diversity of citizenship. Because it was unclear whether Gonzales intended to pursue a claim against Brambila, and because Brambila remained named as a party, the court concluded that its jurisdiction under § 1332 was in doubt.

Order

Judge Joseph C. Spero ordered Gonzales to file, no later than December 22, 2021, either: (1) a notice of dismissal of his claims against Brambila; or (2) a motion to remand the case to state court arguing that Brambila was not fraudulently joined.

The order did not itself dismiss Gonzales’s claims, remand the case, or decide whether Brambila was fraudulently joined. It also did not decide the underlying claims arising from the accident.