Scales v. LA Web Experts

Background

William Scales filed this action without a lawyer and without paying the filing fee. He named LA Web Experts and Vista Website Design as defendants, but his complaints generally referred to only one unspecified defendant. He alleged that the defendant sabotaged his company by preventing him from hiring a new web developer and launching his company. He asserted breach-of-contract and negligence claims and sought millions of dollars in damages.

In an earlier order, the court dismissed any claims Scales was trying to bring on behalf of his corporation because he did not allege that he was a lawyer. The court also concluded that it lacked subject-matter jurisdiction—the authority to hear the case—because the pleaded claims appeared to arise under state law, and Scales had not provided sufficient information about the parties’ citizenship or alleged facts plausibly showing more than $75,000 in damages. The court gave him 60 days to amend.

Scales filed an amended complaint. He again asserted breach-of-contract and negligence claims, invoked federal-question and diversity jurisdiction, alleged that he was a citizen of New York, and alleged that LA Web Experts and Vista Website Design were located in California. He did not allege where either defendant was incorporated or where either had its principal place of business. He also alleged losses involving revenue, company investments, business opportunities, and website and mobile-application functions. He attached approximately 180 pages of text-message and email screenshots.

Scales later filed a motion for a default judgment, letters requesting an order of service and appointment of counsel, and a brief.

Claims on Behalf of the Company

The court again concluded that Scales could not bring claims on behalf of his company because he did not allege that he was an attorney or that the company was a sole proprietorship. Those claims were dismissed without prejudice.

Subject-Matter Jurisdiction

The court held that the amended complaint did not establish federal-question jurisdiction. Although Scales invoked federal jurisdiction, the complaint primarily asserted breach-of-contract and negligence claims, which the court described as generally arising under state law. The complaint did not provide facts suggesting that Scales could state a claim under federal law. Simply invoking federal jurisdiction was not enough.

The court also considered diversity jurisdiction. Scales alleged that he was a New York citizen and that the defendants were located in California, but he did not allege their citizenship in the legally required way. Even assuming that the parties were citizens of different states, the court found that Scales had not alleged facts plausibly showing that the amount in controversy exceeded $75,000. His request for “millions” of dollars was unsupported by facts describing his losses or explaining why the defendants would be liable for that amount. The court also noted that the amended complaint did not plead facts sufficient to support the breach-of-contract and negligence claims.

Disposition

The court dismissed the action for lack of subject-matter jurisdiction under Federal Rule of Civil Procedure 12(h)(3). Because Scales had already been given an opportunity to amend and the defects could not be cured by another amendment, the court declined to grant further leave to amend. The order states that all other pending matters were terminated, directs the Clerk to enter judgment, and denies Scales permission to appeal without paying the filing fee because the court certified that an appeal would not be taken in good faith.