Benter v. United Parcel Service, Inc.

Background

Samuel Benter brought a claim against United Parcel Service, Inc. before the California Department of Industrial Relations, Labor Commissioner’s Office. He alleged that UPS failed to reimburse him for business expenses, particularly cellphone costs of $50 per month. The opinion states that the claimed amount was initially $1,800. After the Labor Commissioner ruled against Benter, he appealed to Contra Costa Superior Court. UPS removed that state-court proceeding to federal court.

Benter moved to remand, meaning he asked the federal court to return the case to state court. He argued that removal was untimely and that the federal court lacked diversity jurisdiction because the amount in controversy did not exceed $75,000. The parties did not dispute that they were completely diverse.

Timeliness of Removal

The court rejected Benter’s timeliness argument. Although Benter served the notice of appeal on December 18, 2023, UPS removed the case on January 22, 2024. The court explained that the 30-day removal period begins when the defendant receives the pleading, not necessarily when the plaintiff serves it. Because the notice was mailed, three additional days applied under Federal Rule of Civil Procedure 6(d). Thirty-three days after December 18 was January 20, a Saturday, so the next court day was January 22. The court therefore concluded that UPS’s removal was timely.

Amount in Controversy

Federal diversity jurisdiction generally requires more than $75,000 to be at stake, excluding interest and costs. Because it was unclear from the filings whether that threshold was met, UPS had the burden to show by a preponderance of the evidence—that it was more likely than not—that the amount in controversy exceeded $75,000.

The court held that attorney’s fees authorized by California Labor Code section 2802 could be included in the amount in controversy. Although Benter argued that the statute treated attorney’s fees as costs, the court concluded that the fees were part of the substantive liability at issue rather than costs excluded from the jurisdictional calculation.

The court nevertheless found that UPS had not shown that the total amount exceeded $75,000. Benter’s compensatory damages were relatively small: the opinion identifies $1,800 in the original complaint and states that Benter later calculated the recovery at $3,000. The case involved one claim for business reimbursement and one type of expense, cellphone usage. The court also expected a limited trial and limited pretrial preparation. Benter’s counsel had spent 12 hours on the Labor Commissioner proceeding, at hourly rates between $450 and $550. The court found that UPS had not adequately shown that fees in this relatively simple case would exceed the jurisdictional threshold. The court also found that UPS’s cited fee awards involved materially different cases, including cases with multiple trials or longer trials.

Attorney’s Fees for Removal

Benter requested attorney’s fees under 28 U.S.C. § 1447(c) because his remand motion succeeded. The court denied that request. It explained that fees generally may be awarded when the removing party lacked an objectively reasonable basis for removal. Although the court ruled against UPS on the amount-in-controversy issue, it concluded that UPS had not acted unreasonably in arguing that the jurisdictional threshold could be met.

Disposition

The court granted Benter’s motion to remand, remanded the case to Contra Costa Superior Court, and denied Benter’s request for attorney’s fees. The Clerk was ordered to effectuate the remand and close the federal case. The order disposed of Docket No. 13.