Holliday v. Jaguar Land Rover North America, LLC

Background

Lisa Holliday purchased a 2018 Land Rover Range Rover Velar on May 19, 2021. She later discovered alleged defects, including problems causing the check-engine light to illuminate, the screen to go black, and the engine to fail. She sued Jaguar Land Rover North America, LLC under California’s Song-Beverly Act and sought, among other relief, a civil penalty of at least $141,044.40.

Holliday filed the original complaint in state court on December 28, 2023. Jaguar Land Rover removed the case to federal court on January 29, 2024, relying on diversity jurisdiction. On February 6, 2024, Holliday filed a first amended complaint adding Haron Motor Sales, Inc. as a defendant. She then moved to remand the case to state court. Jaguar Land Rover moved to dismiss or strike the amended complaint, arguing that Holliday had not obtained permission to add Haron and that the addition did not satisfy the requirements for joining a defendant whose citizenship could defeat federal jurisdiction.

Motion to Dismiss or Strike

The court found that Holliday should have sought permission under 28 U.S.C. § 1447(e) before adding a potentially non-diverse defendant. Although the failure to seek permission could have supported striking the amended complaint, the court decided that striking it would be inefficient because the parties had fully briefed whether joinder should be allowed.

The court applied six factors under § 1447(e). It found that the factors overall favored allowing Haron’s addition. The court concluded that a separate lawsuit against Haron would likely involve the same facts and discovery; Holliday had not shown that the statute of limitations would prevent a separate action; and, although she did not explain why Haron was absent from the original complaint, she had amended only eight days after removal and had not unreasonably delayed. The court also found no evidence that Holliday’s only purpose was to defeat federal jurisdiction. It determined that the claims against Haron appeared facially valid and that denying joinder could force Holliday to choose between redundant litigation and giving up potential claims.

The court therefore permitted the amendment under § 1447(e) and denied Jaguar Land Rover’s motion to dismiss or strike the first amended complaint.

Motion to Remand

The court first found that Jaguar Land Rover had timely removed the case. It then addressed whether the requirements for diversity jurisdiction were met. The amount-in-controversy requirement was satisfied because Holliday sought a civil penalty of $141,044.40.

The court found, however, that Jaguar Land Rover had not provided enough evidence to establish complete diversity of citizenship. For a limited liability company, citizenship depends on the citizenship of its owners or members, not merely where the company was formed or has its principal place of business. Jaguar Land Rover provided no evidence about the citizenship of its owners or members. It also offered no evidence of Holliday’s citizenship or domicile.

The court further found that Jaguar Land Rover had not met its heavy burden to show that Haron was fraudulently joined. The court found no evidence that Holliday joined Haron solely to defeat federal jurisdiction and determined that Holliday had stated facially valid claims against Haron. Assuming Haron was a California citizen, the court concluded that Haron’s joinder defeated complete diversity. Because Jaguar Land Rover had not established diversity of citizenship, the court found that it lacked subject-matter jurisdiction and granted Holliday’s motion to remand.

Jurisdictional Discovery and Disposition

Jaguar Land Rover also requested jurisdictional discovery, meaning discovery intended to obtain facts relevant to federal jurisdiction. The court declined that request because Jaguar Land Rover did not identify what facts discovery might reveal. The court noted that information about Jaguar Land Rover’s own citizenship was within its control and that Jaguar Land Rover had not identified evidence about Holliday or Haron that could change the removal analysis.

The order granted Lisa Holliday’s motion to remand and denied Jaguar Land Rover North America, LLC’s motion to dismiss or strike the first amended complaint.