1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 6 MICHAEL HASS, Case No. 25-cv-06018-JSC

7 Plaintiff, ORDER REMANDING CASE v. 8 Re: Dkt. Nos. 30, 31 9 FLOWERS BAKERIES SALES OF NORCAL, LLC, et al., 10 Defendants.

11 12 Plaintiff brought a putative class action against Defendants in state court for violation of 13 California wage and hour laws. Defendants removed the action to this federal court on the basis of 14 diversity jurisdiction, not jurisdiction under the Class Action Fairness Act. (Dkt. No. 1 ¶ 7.)1 15 Defendants contend there is complete diversity between Plaintiff Michael Hass and Defendants 16 and that the $75,000 amount in controversy is satisfied as to Mr. Hass. Plaintiff did not move to 17 remand or otherwise challenge Defendants’ removal allegations. 18 On November 10, 2025, the Court ordered Defendants to show cause “how this federal 19 court has removal jurisdiction based on diversity jurisdiction.” (Dkt. No. 30 at 3.) The Court 20 noted:

21 When calculating the amount in controversy in a putative class action, “the potential attorneys’ fees should be attributed pro rata to each 22 class member.” Rosenwald v. Kimberly-Clark Corp.,

, 1179–80 (9th Cir. 2025) (citing Goldberg v. CPC Int’l, Inc.,

(9th Cir. 1982)) (cleaned up). So, even if Plaintiff’s damages at issue here total $28,282, diversity jurisdiction requires 24 $46,718 in attorneys’ fees “per class member.” Rosenwald, 152 F.4th at 1179 (italics in original). Plaintiff estimates the class is “greater 25 than two hundred (200) individuals.” (Dkt. No. 1-2 ¶ 23a). To satisfy the amount in controversy, Plaintiff’s attorneys’ fees award would 26 need to be roughly $9.3 million, i.e., over 11,000 hours at Plaintiff’s 27 counsel’s rate of $829 an hour. (Dkt. No. 1 ¶ 57.) Defendants have 1 not shown that is likely to happen; of Defendants’ cited cases, the upper end of what a plaintiff’s attorney worked was 869.6 hours. (Id. 2 ¶ 56 (citing Betancourt v. OS Restaurant Services, LLC,

, 136 (2022)).) […] So, from the Notice of Removal it appears 3 the amount of controversy is not satisfied and the Court lacks removal jurisdiction of this action. 4 5 (Dkt. No. 30 at 2.) Defendants filed a response on November 17, 2025, arguing removal is proper 6 because attorneys’ fees should not be apportioned across class members, and Defendants’ estimate 7 of future attorneys’ fees is based solely on Plaintiff’s individual claims. (Dkt. No. 31.) 8 For the reasons set forth below, the Court REMANDS the case to Humboldt County 9 Superior Court because Defendants have not met their burden of showing the amount in 10 controversy exceeds $75,000 as required by

(a). In a putative class action where 11 the plaintiff prays for attorneys’ fees under a fee-shifting provision that does not award fees 12 exclusively to the named plaintiffs, “the potential attorneys’ fees should be attributed pro rata to 13 each class member.” Rosenwald, 152 F.4th at 1179–80 (cleaned up). Accordingly, Defendants’ 14 Notice of Removal and Response to the Court’s Order to Show Cause have not demonstrated 15 Plaintiff’s damages and share of the potential attorneys’ fees award exceed $75,000. 16 DISCUSSION 17 A defendant seeking removal “bears the burden of establishing that removal is proper” and 18 the “removal statute is strictly construed against removal jurisdiction.” Provincial Gov't of 19 Marinduque v. Placer Dome, Inc.,

(9th Cir. 2009). “Where, as here, it is 20 unclear or ambiguous from the face of a state-court complaint whether the requisite amount in 21 controversy is pled, the removing defendant bears the burden of establishing, by a preponderance 22 of the evidence, that the amount in controversy exceeds the jurisdictional threshold.” Urbino v. 23 Orkin Servs. of Cal., Inc.,

, 1121–22 (9th Cir. 2013) (cleaned up). Further, when a 24 case is removed to federal court, the court has an independent obligation to satisfy itself that it has 25 federal subject matter jurisdiction. Valdez v. Allstate Ins. Co.,

(9th Cir. 26 2004). A case must be remanded back to state court “if at any time before final judgment it 27 appears that the district court lacks subject matter jurisdiction.”

(c). 1 Defendants estimate the amount of controversy as to Mr. Hass is $152,632, which consists of 2 $28,282 in damages and penalties and $124,350 in attorneys’ fees. (Dkt. No. 1 ¶ 60.) They 3 calculate the amount of fees based on 150 hours of attorney time at Plaintiff’s counsel’s hourly 4 rate of $829.00. (Id. ¶¶ 57–59.) Defendants argue removal is proper because potential attorneys’ 5 fees awards should not be apportioned across class members in a putative class action when a class 6 “is not and may never be certified.” (Dkt. No. 31 at 8.) Rather, Defendants urge the estimate of 7 Plaintiff’s potential fee award should be based on the attorneys’ fees associated with litigating 8 Plaintiff’s individual claims. But Defendants’ position contradicts binding Ninth Circuit 9 precedent. 10 Rosenwald was a putative class action where, as here, subject matter jurisdiction was based 11 on the $75,000 amount-in-controversy requirement for diversity jurisdiction rather than the Class 12 Action Fairness Act; in particular, on when the amount in controversy is met if “at least one class 13 member could recover more than $75,000.”

. The Ninth Circuit held that when 14 calculating the amount in controversy in such cases, “potential attorneys’ fees should be attributed 15 … pro rata to each class member[.]”

at 1179 (quoting Goldberg v. CPC Int’l Inc.,

(9th Cir. 1982)). Rosenwald interpreted a fee-shifting provision awarding “‘attorney’s 17 fees to a prevailing plaintiff,’ not just a prevailing named plaintiff.”

at 1179 n.3 (citing Cal. 18 Civ. Code § 1780(e) and Kanter v. Warner-Lambert Co.,

(9th Cir. 2001)); see 19 also Gibson v. Chrysler Corp.,

, 942 (9th Cir. 2001) (fee award “to a successful 20 party” in

must be divided equally);

at 942-43 (citing out-of- 21 circuit cases with the same interpretation of fee-shifting provisions). 22 The two fee-shifting provisions upon which Defendants rely here similarly award 23 attorneys’ fees to a prevailing plaintiff, not just a prevailing named plaintiff.2 Section 226(e)(1) of 24 the California Labor Code awards attorneys’ fees to “[a]n employee suffering injury,” and Section 25 1194 awards fees to “any employee receiving less than the legal minimum wage or the legal 26 overtime compensation.”

(e)(1), 1194(a). Just like the provision in Gibson, 27 1 attorneys’ fees under these Labor Code provisions “are not awarded solely to the named plaintiffs 2 in a class action, and … they therefore cannot be allocated solely to those plaintiffs for purposes of 3 amount in controversy.” Gibson, 261 F.3d at 942. The plain language of these provisions does 4 not limit fee recovery to the named plaintiff and no California court has held otherwise; so, “under 5 the[ese] California law[s] at least, attorneys’ fees are not awarded solely to the named plaintiffs in 6 a class action.” Gibson, 261 F.3d at 942. Indeed, Gibson approvingly cited out-of-circuit cases 7 interpreting variations of these phrases to mean attorneys’ fees are divided among class members 8 for amount-in-controversy purposes. See Gibson, 261 F.3d at 942–43 (collecting the following 9 cases: Cohen v. Office Depot Inc.,

, 1080 n.11 (11th Cir. 2000) (interpreting 10 “the prevailing party” in a Florida statute to mean “the entire class of plaintiffs … would ‘prevail’ 11 in the action, and accordingly, it is the class … who would recover attorney fees”); Darden v. 12 Ford Consumer Finance Co., Inc.,

, 757–58 (11th Cir. 2000) (the phrase “any person 13 who is injured” “gives each individual plaintiff in a putative class the right to recover attorneys’ 14 fees”). Accordingly, Plaintiff’s potential fee award must be divided by the number of class 15 members for jurisdictional amount in controversy purposes. 16 In its Response to the Order to Show Cause, Defendants argue attorneys’ fees should not 17 be apportioned across the class because “Defendants’ removal is based only on the fees at issue to 18 litigate Plaintiff’s individual claims only.” (Dkt. No. 31 at 11) (emphasis in original). In 19 support of this argument, Defendants make several interrelated points: (1) attorneys’ fees awards 20 should not be apportioned across a putative class, and Plaintiff’s class has not been certified, (2) 21 Gibson is distinguishable because here, Defendants estimate fees associated with Plaintiff’s 22 individual claims, (3) “Rosenwald does not apply here because Plaintiff seeks fees under sections 23 226 and 1194 of the California Labor Code for his individual claims”; and (4) district courts post- 24 Gibson and pre-Rosenwald have permitted fee estimates based on individual claims. (Id. at 8–14.) 25 Defendants cite Gibson for the first two arguments. First, in a section of the opinion 26 unrelated to fee-shifting provisions, Gibson observed “‘a complaint … filed only by a named 27 plaintiff or plaintiffs … is, at the time of filing, only a would-be class action. It does not become a 1 937).) Under this logic, prior to class certification, Plaintiff’s lawsuit is only for individual claims, 2 so apportioning fees across “the estimated number of putative class members in a class that is not 3 and may never be certified would be wholly speculative[.]” (Dkt. No. 31 at 8.) Second, 4 Defendants contend “in Gibson, the removing defendant … improperly attempted to allocate the 5 amount of fees associated with the entire class action to the named plaintiff,” as opposed to 6 Defendants’ estimate here, which tallies fees associated with tasks related to Plaintiff’s individual 7 claims. (Dkt. No. 31 at 10.) 8 The Court disagrees on both fronts. Defendants’ first argument relies on a portion of the 9 Gibson opinion that does not address fee-shifting provisions or apportionment of fees. See 261 10 F.3d at 934–937. That explains why the named plaintiffs’ failure to certify a class was not 11 dispositive there: after observing, as a general matter, a putative class action “does not become a 12 class action until certified by the district court,” Gibson states “[w]e have no doubt that attorneys’ 13 fees would exceed $75,000 per named plaintiff in this case if … class certification were granted.” 14 Id. at 941. And yet, although a class had not been certified, Gibson held its named plaintiffs did 15 not satisfy the amount-in-controversy requirement “because ... any attorneys’ fees awarded in this 16 action [must] be divided among all members of the class.” Id. at 943 (emphasis added). This 17 same language also forecloses Defendants’ second argument because the dispositive issue in 18 Gibson was not that the removing defendants included attorneys’ fees “associated with the entire 19 class action,” (Dkt. No. 31 at 10), but rather, the failure to equally divide “any attorneys’ fees” 20 among all members the class. Gibson, 261 F.3d at 943. 21 Similarly, Defendants’ third argument distinguishes the fee-shifting provision at issue in 22 Rosenwald, California Civil Code Section 1780, by arguing Plaintiff seeks attorneys’ fees only 23 “for his individual claims.” (Dkt. No. 31 at 10.) But Section 1780 provides a cause of action and 24 attorneys’ fees for individuals regardless of whether the suit is filed as a class action. See Cal. 25 Civ. Code §§ 1780(a) (“Any consumer who suffers any damage … may bring an action[.]”); 26 1780(b)(2) (“Judgment in a class action by senior citizens or disabled persons … may award each 27 class member [an] additional award” if certain conditions are met); 1780(e) (“The court shall 1 Rosenwald did not hinge on whether the named plaintiffs prayed for attorneys’ fees for individual 2 claims or class-wide claims. Just like in Gibson, the question in Rosenwald was whether the fee- 3 shifting provision awards fees exclusively to named plaintiffs. And just like the fee-shifting 4 provisions here, the answer in both cases was “no,” so fees must be apportioned across all class 5 members. 6 Fourth, Defendants identify no Ninth Circuit case supporting their insistence that in a class 7 action they can satisfy the $75,000 amount in controversy based on attorneys’ fees associated with 8 a named plaintiff’s individual claims. Defendants contend “[p]ost-Gibson and even after 9 Rosenwald, multiple courts have permitted reasonable fee estimates based on individual wage and 10 hour claims.” (Dkt. No. 31 at 11.) Defendants cite only federal district court cases; but none are 11 persuasive because they do not mention Gibson or Rosenwald.3 This Court is bound by Gibson 12 and Rosenwald. 13 Moreover, Defendants’ proposed dichotomy between fees for individual and class claims 14 is contrary to how the amount-in-controversy inquiry is conducted. “The amount in controversy is 15 not a prospective assessment of a defendant’s liability,” Chavez v. JPMorgan Chase & Co., 888

, 417 (9th Cir. 2018), nor does the amount in controversy refer to “likely or probable 17 liability; rather, it refers to possible liability.” Greene v. Harley-Davidson, Inc.,

, 772 18 (9th Cir. 2020). So, if a plaintiff alleges a putative class and attorneys’ fees are authorized for all 19 class members, all possible future attorneys’ fees are “at stake” and therefore included in the 20 amount in controversy so long as the estimate of future fees is proven by a preponderance of the 21 evidence and not “too speculative.” See Fritsch v. Swift Transportation Co. of Arizona,

785, 793 (9th Cir. 2018). In considering whether a future fee estimate is “too speculative,” the 23 Ninth Circuit is “confident” courts can use their “expertise” in evaluating customary hourly rates, 24 evidence, and whether fees are authorized by statute or contract.

at 795–96. 25

26 3 See Forrest v. MAV KG, LLC,

(E.D. Cal. Sept. 29, 2025); Luciano v. GS Operating, LLC,

, *2 (N.D. Cal. Feb. 28, 2025); Kendall v. Verizon Data 27 Services, LLC, 2023 WL218963 *2 (N.D. Cal. Jan. 17, 2023); Ott v. Cooper Interconnect, Inc., 1 What courts may not do, however, is “decide the merits of the case before it could 2 || determine it if had subject matter jurisdiction.” Geographic Expeditions Inc. v. Estate of Lhotka 3 || ex rel. Lhotka,

(9th Cir. 2010). For instance, courts cannot consider merits- 4 || based arguments, such as the application of affirmative defenses to unnamed class members, 5 || because the “jurisdictional inquiry ... is supposed to be simple and mechanical.” Greene, 965 at 6 || 774 (cleaned up). So, although Defendants are correct the class “is not and may never be 7 || certified,” (Dkt. No. 31 at 8), the eventual outcome of class certification goes to Defendants’ 8 “probable liability” for fees rather than what fees are “possible” at the time of removal. Cf

at 772. Defendants protest that it is “wholly speculative” to apportion fees when a 10 || class “may never be certified,” but it would be equally speculative (if not improper) to assume, as 11 Defendants advocate, Plaintiff’s class will not be certified due to a pending motion to strike the 12 || class allegations. (See Dkt. No. 31 at 8); Steel Co. v. Citizens for a Better Env’t,

, 94— E 13 95 (1998) (“Without jurisdiction the court cannot proceed at all in any cause. Jurisdiction is power 14 || to declare the law, and when it ceases to exist, the only function remaining to the court is that of 3 15 announcing the fact and dismissing the cause.”). 16 CONCLUSION i 17 For the reasons set both above, the Court REMANDS Plaintiffs case to Humboldt County Z 18 Superior Court. Under binding Ninth Circuit law, when a plaintiff in a putative class action seeks 19 || attorneys’ fees under a fee-provision that does not exclusively award fees to named plaintiffs, the 20 || potential attorneys’ fees award must be divided equally among class members to determine the 21 amount in controversy. Applying that law here, Defendants’ estimate of Plaintiff's damages and 22 || attorneys’ fees award does not exceed $75,000. 23 IT IS SO ORDERED. 24 Dated: November 26, 2025 , □□ ie Stet JACQUELINE SCOTT CORLEY 26 United States District Judge 27 28