Anoke v. Twitter, Inc.

Background

The 15 petitioners were former employees of Twitter, Inc. They alleged that they had signed arbitration agreements with Twitter as a condition of employment, with arbitration to occur through JAMS. On February 24, 2023, they each filed an arbitration demand asserting state- and federal-law claims, including claims under the federal Worker Adjustment and Retraining Notification Act.

On April 27, 2023, petitioners filed a petition in San Francisco County Superior Court under California Code of Civil Procedure § 1281.97. That statute provides remedies when the drafting party to an employment or consumer arbitration agreement does not timely pay the fees needed to begin arbitration. Petitioners asked the state court to require Twitter to proceed with arbitration, pay outstanding JAMS fees, and pay related costs and reasonable attorneys’ fees. They named Twitter, Inc.; X Holdings I, Inc.; X Holdings Corp.; X Corp.; and Elon Musk as respondents.

Respondents removed the action to federal court based on federal-question jurisdiction. Petitioners moved to remand the action to state court and requested attorneys’ fees and costs for bringing the remand motion.

Jurisdiction and Remand

The court explained that federal-question jurisdiction generally must appear on the face of the plaintiff’s properly pleaded complaint or petition. Respondents relied on Vaden v. Discover Bank, in which the Supreme Court held that a court may examine the underlying dispute when deciding jurisdiction over a petition to compel arbitration under § 4 of the Federal Arbitration Act. The court noted, however, that the Supreme Court later limited that “look-through” approach to § 4 petitions and declined to extend it to other Federal Arbitration Act applications.

This action was not brought under § 4 of the Federal Arbitration Act. Petitioners sought relief only under California Code of Civil Procedure § 1281.97. The court therefore found it irrelevant whether petitioners could have filed a different petition under § 4 based on the federal claims in their arbitration demands. Because the state-law petition itself did not establish federal-question jurisdiction, and removal jurisdiction is strictly construed in favor of remand, the court granted the motion to remand.

Fees and Costs

The court declined to award petitioners attorneys’ fees and costs under 28 U.S.C. § 1447(c). It considered petitioners’ allegations about respondents’ misrepresentations and delay tactics but concluded that many of those arguments were intertwined with the underlying case and were better left for the state court. The court declined to find that respondents lacked an objectively reasonable basis for removal.

Disposition

Judge Susan Illston ordered that the action be remanded to the Superior Court of the State of California, County of San Francisco. The court denied petitioners’ request for attorneys’ fees and costs associated with the motion to remand and vacated the case-management conference scheduled for August 11, 2023.