Bartfeld v. AMCO Insurance Company

Background

Bruce and Jeri Bartfeld, individually and doing business as Bartfeld Sales, sued AMCO Insurance Company, John Doe, and Roes 1-75 in San Francisco Superior Court. The lawsuit arose from a July 28, 2020 fire that destroyed their San Francisco warehouse and construction-supply business. AMCO removed the case to federal court based on diversity jurisdiction.

The parties did not dispute that the amount in controversy exceeded $75,000 or that the Bartfelds and AMCO were citizens of different states. The opinion states that the Bartfelds were California citizens and that AMCO was organized under Iowa law and had its principal place of business in Des Moines, Iowa. The Bartfelds alleged that John Doe started the fire and argued that he was an unhoused individual residing in San Francisco. They said police and fire department reports might reveal his identity, but the fire department had not released the requested investigation materials.

Motion to Remand

The Bartfelds moved to remand, meaning to return the case to state court. They argued that John Doe was a real defendant whose California citizenship defeated complete diversity. AMCO argued that John Doe’s citizenship could not be considered because he had not been identified or named when the case was removed.

The court also granted the Bartfelds’ request for judicial notice of a preliminary fire incident report because the complaint extensively referred to it, its authenticity was not reasonably disputed, and it was relevant to the motion.

Court’s Analysis

The court explained that federal law allows removal of cases that could originally have been filed in federal court. Diversity jurisdiction generally requires an amount in controversy above $75,000 and complete diversity of citizenship between the parties. The defendant that removes a case bears the burden of showing that removal was proper.

The court relied on 28 U.S.C. § 1441(b)(1), which provides that the citizenship of defendants sued under fictitious names is disregarded when deciding whether a case is removable based on diversity jurisdiction. The court also relied on Ninth Circuit decisions stating that a fictitious defendant’s citizenship is disregarded for removal purposes and becomes relevant if the plaintiff later seeks permission to substitute a named defendant.

The court acknowledged that California federal district courts have disagreed about whether a complaint’s detailed description of an unidentified defendant can defeat removal when the defendant may be readily identified. It concluded that the removal statute’s text, legislative history, and Ninth Circuit law favored denying remand here. John Doe’s identity was unknown both when AMCO removed the case and when the court decided the motion. The Bartfelds had provided no evidence that John Doe had been apprehended, that his California citizenship had been established, or that law enforcement had determined and verified his identity.

The court further explained that federal law provides a later procedure for seeking to add a defendant whose joinder would destroy subject-matter jurisdiction. If the Bartfelds later identify and seek to join John Doe, the court may deny joinder or permit joinder and remand the action to state court.

Disposition

Judge Thomas S. Hixson denied the Bartfelds’ motion to remand. The opinion did not decide the underlying claims concerning the fire or AMCO’s liability. It held only that John Doe’s citizenship had to be disregarded at the removal stage because he remained unidentified and had not been substituted as a named defendant.