1 UNITED STATES DISTRICT COURT

2 DISTRICT OF NEVADA

3 4R4 SONS, LLC, et al., ) 4 ) Plaintiffs, ) Case No.: 2:21-cv-01081-GMN-NJK 5 vs. ) ) ORDER 6 TRU G. WILHELM, INC., ) 7 ) Defendant. ) 8 ) 9 10 Pending before the Court is the Motion to Remand, (ECF No. 15), filed by 4R4 Sons, 11 LLC, et al. (“Plaintiffs”). Defendant Tru G. Wilhelm, Inc. (“Defendant”) filed a Response, 12 (ECF No. 21), to which Plaintiffs filed a Reply, (ECF No. 24). 13 Also pending before the Court is the Motion for Leave to File Supplemental 14 Memorandum in Support of Defendant’s Opposition to Plaintiffs’ Motion to Remand (“Motion 15 for Leave to File”), (ECF No. 48), filed by Defendant. Plaintiffs filed a Response, (ECF No. 16 55), and Defendant filed a Reply, (ECF No. 63). 17 For the reasons discussed below, the Court GRANTS Plaintiffs’ Motion to Remand and 18 DENIES Defendant’s Motion for Leave to File. 19 I. BACKGROUND 20 This case arises from a landlord-tenant dispute regarding a commercial property owned 21 by Defendant and rented by Plaintiffs. (See generally Am. Compl., ECF No. 3-17). The parties 22 provided a detailed review of the facts and procedural history of this case in the briefing for the 23 Motion to Remand. (See Mot. Remand 3:6–5:7, ECF No. 15); (Resp. Mot. Remand 1:22–4:3, 24 ECF No. 21). Plaintiffs now move the Court to remand this case back to state court because, 25 1 among other things, the jurisdictional requirements under

are not satisfied. 2 (See generally Mot. Remand). 3 II. LEGAL STANDARD 4 Federal courts are courts of limited jurisdiction, possessing only those powers granted by 5 the Constitution and by statute. See United States v. Marks,

(9th Cir. 2008). 6 “If at any time before final judgment it appears that the district court lacks subject matter 7 jurisdiction, the case shall be remanded.”

(c). Generally, district courts have 8 subject matter jurisdiction over civil actions in which: (1) the claims arise under federal law; or 9 (2) where no plaintiff is a citizen of the same state as a defendant and the amount in 10 controversy exceeds $75,000.00. See

, 1332(a). 11 A civil action brought in state court may be removed to a federal district court if the 12 district court has original jurisdiction over the matter.

(a). The defendant 13 asserting the removal must prove it is proper, and there is a strong presumption against removal 14 jurisdiction. Gaus v. Miles, Inc.,

(9th Cir. 1992). “Federal jurisdiction must 15 be rejected if there is any doubt as to the right of removal in the first instance.”

(quoting 16 Libhart v. Santa Monica Dairy Co.,

(9th Cir. 1979)). 17 III. DISCUSSION 18 Plaintiffs move the Court to remand this action for four reasons: (1) the amount in 19 controversy is not met; (2) Defendant waived its right to remove by manifesting its intent to 20 litigate this matter in state court; (3) Defendant is engaging in forum shopping; and (4) 21 Defendant is improperly seeking a de facto appeal of the state court’s adjudication. (Mot. 22 Remand 6:6–13:10). In addition, Plaintiffs seek attorney’s fees because Defendant lacked an

23 objectively reasonable basis to remove the case. (Id. 13:11–15:17). Defendant opposes each 24 claim, (see generally Resp. Mot. Remand), and moves the Court for leave to file a supplemental 25 brief regarding jurisdiction, (see generally Mot. Leave File, ECF No. 48). The Court first turns 1 to the issue of remand, specifically, whether the amount in controversy is met, then addresses 2 Defendant’s Motion for Leave to File, and ends with the issue of attorney’s fees. 3 A. Plaintiffs’ Motion to Remand – Amount in Controversy 4 Plaintiffs argue Defendant has not met its burden of proving that subject matter 5 jurisdiction exists because it fails to show that the object of the litigation exceeds $75,000. 6 (Mot. Remand 6:8–27). Defendant responds that the object of the litigation, which it avers is a 7 possessory intertest in the leasehold property, exceeds the jurisdictional amount because 8 Plaintiffs owe Defendant $87,391.12 in late rental payments. (Resp. Mot. Remand 5:24–6:28). 9 Defendant also argues that Plaintiffs’ attorney’s fees exceed $75,000. (Id. 8:16–10:12). 10 “Where it is not facially evident from the complaint that more than $75,000 is in 11 controversy, the removing party must prove, by a preponderance of the evidence, that the 12 amount in controversy meets the jurisdictional threshold. . . . Conclusory allegations as to the 13 amount in controversy are insufficient.” Matheson v. Progressive Specialty Ins. Co.,

1089, 1090 (9th Cir. 2003). A removing party must provide specific, factual allegations 15 showing how the case in controversy exceeds $75,000. See

Further, the Court may consider 16 “facts presented in the removal petition as well as any ‘summary-judgement-type evidence 17 relevant to the amount in controversy at the time of removal.’”

The removing party may not 18 rely on speculation to demonstrate that the amount in controversy is met. Roberts v. Walmart 19 Inc., No. 2:19-cv-00509-MMD-EJY,

, at *2 (D. Nev. Sept. 26, 2019). 20 “In actions seeking declaratory or injunctive relief, it is well established that the amount 21 in controversy is measured by the value of the object of the litigation.” Corral v. Select 22 Portfolio Servicing, Inc.,

(9th Cir. 2017) (quoting Cohn v. Petsmart, Inc.,

23

(9th Cir. 2002)). “[T]he test for determining the amount in controversy is 24 the pecuniary result to either party which the judgment would directly produce.”

(quoting In 25 re Ford Motor Co./Citibank (S. Dakota), N.A.,

(9th Cir. 2001)). 1 Here, Defendant does not meet its burden. The object of the litigation in this case is 2 Plaintiffs’ ability to continue to lease the commercial property in question. Thus, to satisfy its 3 burden of establishing the amount in controversy related to Plaintiffs’ ability to lease the 4 commercial property, Defendant is required to prove, by a preponderance of the evidence, that 5 the benefit to Plaintiffs of continuing their lease would exceed $75,000, or that the cost to 6 Defendant of Plaintiffs continuing their lease would exceed $75,000. The pecuniary benefit 7 Plaintiffs gain by continuing their lease is their ability to retain the same space to continue its 8 business operations.1 Defendant contends that Plaintiffs benefit from lower rental payments 9 than other leases of similar buildings in the greater Las Vegas area. (See Resp. Mot. Remand 10 7:5–8:6). Defendant attempts to prove this pecuniary benefit by providing a Declaration by 11 Brett Wilhelm, where Mr. Wilhelm states that based on his research, analysis, and calculations, 12 Plaintiffs pay approximately $52,050.00 per year below the current market lease rates. (See 13 Decl. Brett E. Wilhelm ¶¶ 8–11, Ex. 5 to Pet. Removal, ECF No. 3-5). 14 However, Defendant fails to provide evidence supporting Mr. Wilhelm’s total 15 calculation. (See Suppl. Decl. Brett E. Wilhelm ¶ 6, Ex. 1 to Resp. Mot. Remand, ECF No. 21- 16 1) (declaring that some of the listings and notes Mr. Wilhelm relied on to calculate the 17 $52,050.00 figure are unavailable). Further, Mr. Wilhelm relies on properties dissimilar to the 18 commercial property in question. (See

¶ 7–11, 14–17, Ex. 1 to Resp. Mot. Remand) 19 (pointing to properties where square footage, location, building features, and age vary 20 significantly to each other and to the commercial property in this case). In addition, Defendant 21 does not show that the properties Mr. Wilhelm cites to in his Declaration have similar lease 22 terms as the lease at issue here. As a result, Defendant does not meet its burden of proving, by

23 24 25 1 Defendant argues that the object of the litigation is a possessory interest in the lease of the commercial property. However, the value of the commercial property is not at issue in this case because ownership of the property is not in dispute. Thus, the Court does not entertain this interpretation of the object of the litigation. 1 a preponderance of the evidence, that Plaintiffs’ benefit or Defendant’s cost of Plaintiffs 2 continuing their lease exceeds $75,000.2 See Corral,

. 3 Further, Defendant relies on speculation to determine that Plaintiffs’ attorney’s fees 4 exceed the amount in controversy. “This Court considers attorneys’ fees to be within the 5 amount in controversy if the removing party: (1) identifies ‘an applicable statute which could 6 authorize an award of attorneys’ fees and (2) provide[s] an estimate as to the time the case will 7 require and opposing counsel’s hourly billing rate.’” Lopez v. Walmart, Inc., No. 2:20-cv- 8 01228-GMN-VCF,

, at *4 (D. Nev. Mar. 22, 2021) (quoting Cayer v. Vons 9 Cos., No. 2:16-cv-02387-GMN-NJK,

, at *2 (D. Nev. July 21, 2017)). 10 Defendant has not set forth any basis under which an award of attorney’s fees may be 11 warranted in this case. In fact, Defendant admits it does not know the amount of attorney’s fees 12 Plaintiffs have incurred. (See Resp. Mot. Remand 9:4–5). Instead, it argues Plaintiffs’ 13 attorney’s fees meet the jurisdictional requirement under § 1332 by speculating about the 14 personnel working on behalf of Plaintiffs’ case. (See id. 8:25–9:3). Because Defendant offers 15 no evidence to prove Plaintiffs’ attorney’s fees exceed $75,000, it does not meet its burden of 16 proving, by a preponderance of the evidence, that the amount in controversy is met.3 17 Accordingly, the Court grants Plaintiffs’ Motion to Remand. 18 B. Defendant’s Motion for Leave to File 19 Defendant’s renewed attempt to prove that the amount in controversy is met via its 20 Motion for Leave to File is unavailing. “A party may not file supplemental pleadings, briefs, 21 authorities, or evidence without leave of court granted for good cause.” LR 7-2(g). Good cause 22 under LR 7-2(g) exists if a party seeks leave to file supplemental briefing in a reasonably

23

24 2 In the alternative, even if Defendant’s calculations were applicable, the $52,050.00 figure falls well short of the 25 jurisdictional requirement under § 1332. 3 Because Defendant failed to prove, by a preponderance of the evidence, that the amount in controversy is met, the Court need not address the issues of waiver, forum shopping, or the Rooker-Feldman doctrine. 1 diligent manner. See, e.g., De Luna v. Sunrise Hosp. & Med. Ctr., LLC, Case No. 2:17-cv- 2 01052-JAD-VCF,

, at *5 (D. Nev. Aug. 24, 2018). “Further, the Court will 3 only find good cause exists to allow . . . supplemental briefing if the proposed briefing will 4 make a substantive difference.” Chemeon Surface Tech., LLC v. Metalast Int’l, Inc., No. 3:15- 5 cv-00294-MMD-CBC,

, at *8 (D. Nev. Feb. 26, 2019) (citing Morrison v. 6 Quest Diagnostics Inc., Case No. 2:14-cv-01207-RFB-PAL,

, at *3 (D. Nev. 7 Oct. 24, 2016), aff’d,

(9th Cir. 2017). Further, “[s]ubject matter jurisdiction 8 must exist as of the time the action is commenced.” Morongo Band of Mission Indians v. 9 California State Bd. of Equalization,

, 1380 (9th Cir. 1988)); Freeport- 10 McMoRan, Inc. v. K N Energy, Inc.,

(1991) (affirming previous decisions 11 holding that “diversity of citizenship is assessed at the time the action is filed”). 12 Here, Defendant does not show good cause exists to supplement its opposition to 13 Plaintiffs’ Motion to Remand. Defendant wishes to submit evidence of Plaintiffs’ attorney’s 14 fees to demonstrate that the amount in controversy exceeds $75,000. However, Defendant fails 15 to demonstrate that it was reasonably diligent in seeking leave to file supplemental briefing. 16 Defendant was made aware of Plaintiffs’ attorney’s fees, totaling $73,064.62, on October 7, 17 2021. (See Pls.’ First Suppl. Initial Disclosures 5:6–11, 6:4, Ex. 2 to Mot. Leave File, ECF No. 18 48-2). Despite possessing evidence that the amount in controversy could likely be met, 19 Defendant waited nearly four months to file its Motion for Leave to File. (Compare Pls.’ First 20 Suppl. Initial Disclosures 6:4, Ex. 2 to Mot. Leave File), (with Mot. Leave File). Defendant 21 explains that the evidence was not available until recently, but Plaintiffs submitted their first 22 supplemental initial disclosures approximately four months before Defendant filed its Motion

23 for Leave to File. (See Mot. Leave File 5:19–21); (See Pls.’ First Suppl. Initial Disclosures, Ex. 24 2 to Mot. Leave File). Defendant makes no attempt to explain this lengthy gap. (See generally 25 Mot. Leave File). 1 Further, Defendant states it filed its Motion for Leave to File seventeen days, or “ten 2 judicial days,” after it received Plaintiffs’ bank account records showing they transferred more 3 than $100,000 to McDonald Carano, LLP. (See Reply Resp. Mot. Leave File 5:11–18, ECF No. 4 63). However, this does not show that Defendant was reasonably diligent in waiting nearly 5 four months after obtaining evidence that Plaintiffs’ attorney’s fees could likely satisfy the 6 amount in controversy. See T1 Payments LLC v. New U Life Corp., No. 2:19-cv-01816-APG- 7 DJA,

, at *2 (D. Nev. Jan. 21, 2022) (finding good cause existed to allow a 8 defendant to file supplemental briefing regarding personal jurisdiction because the defendant 9 filed its motion for leave to file within two weeks of discovering new evidence); York v. Bank 10 of Am., No. 14-cv-02471-RS,

, at *1 (N.D. Cal. Dec. 2, 2016) (finding that a 11 defendant failed to show good cause to grant it leave to file a motion for reconsideration 12 because it gave no reason for a “lengthy” thirty-five-day delay); Campbell v. City of Milpitas, 13 No. 13-cv-03817-BLF,

, at *2 (N.D. Cal. May 22, 2015) (concluding that the 14 plaintiffs did not “demonstrate reasonable diligence in bringing their motion for leave to seek 15 reconsideration” because they waited fifty-eight days to bring said motion). Thus, Defendant 16 does not demonstrate it was reasonably diligent in seeking leave to file supplemental briefing. 17 Even if Defendant showed it was reasonably diligent, it does not demonstrate that the 18 proposed briefing “will make a substantive difference.” In removal cases, subject matter 19 jurisdiction must be satisfied at the time of removal. See Matheson v. Progressive Specialty Ins. 20 Co.,

(9th Cir. 2003) (considering whether the amount in controversy is 21 met based on the evidence presented at the time of removal); City of Oakland v. BP PLC, 969

(9th Cir. 2020) (subsequent history omitted) (quoting Provincial Gov’t of

23 Marinduque v. Placer Dome, Inc.,

, 1085 n.1 (9th Cir. 2009)) (“[J]urisdiction 24 must be analyzed on the basis of the pleadings filed at the time of removal without reference to 25 subsequent amendments.”). Future attorney’s fees may be considered in assessing the amount 1 in controversy, but said fees are measured at the time of removal. See Fritsch v. Swift 2 Transportation Co. of Arizona, LLC,

(9th Cir. 2018); Morongo Band of 3 Mission Indians, 858 F.2d at 1380. Defendant did not provide evidence of Plaintiffs’ future 4 attorney’s fees at the time of removal. Rather, it wishes to rely on evidence gathered nearly 5 eight months after it removed the case. (Compare Pet. Removal, ECF No. 3), (with Mot. Leave 6 File). Because the evidence presented originates after the time of removal, Defendant does not 7 show this supplemental briefing will make a substantive difference. See Chemeon Surface 8 Tech., LLC,

, at *8. Thus, Defendant fails to demonstrate good cause exists 9 for the Court to grant it leave to file supplemental briefing. See De Luna,

, at 10 *5. Accordingly, the Court denies Defendant’s Motion for Leave to File. 11 C. Plaintiffs’ Request for Attorney’s Fees 12 Plaintiffs argue they are entitled to attorney’s fees under § 1447(c) because Defendant 13 did not possess an objectively reasonable basis for seeking removal. (See Mot. Remand 13:11– 14 15:17). Defendant takes issue at the precedent Plaintiffs cite to in support of their argument 15 and contends it has an objectively reasonable basis for seeking removal. (Resp. Mot. Remand 16 14:13–16:2). 17 “Absent unusual circumstances, a court may award costs and attorney’s fees under § 18 1447(c) only where the removing party lacked an objectively reasonable basis for seeking 19 removal.” Grancare, LLC v. Thrower by & through Mills,

(9th Cir. 2018) 20 (citing Martin v. Franklin Capital Corp.,

(2005));

(c). 21 Removal is not objectively unreasonable “solely because the removing party’s arguments lack 22 merit, or else attorney’s fees would always be awarded whenever remand is granted.” Lussier v.

23 Dollar Tree Stores, Inc.,

(9th Cir. 2008). 24 Here, the Court disagrees that Defendant lacked an objectively reasonable basis for 25 seeking removal. The record does not reflect that Defendant intentionally contravened settled 1 law of proving that the amount in controversy exceeds $75,000 by failing to provide evidence 2 to support its position. (See Mot. Remand 14:4–27). Instead, Defendant offers genuine 3 arguments, albeit unpersuasive arguments, in opposition to Plaintiffs’ Motion to Remand. For 4 instance, Defendant correctly states the standard for remand in cases involving declaratory or 5 injunctive relief and provides ample analysis applying said standard. (See Resp. Mot. Remand 6 5:24–6:1). Its arguments applying said standard, however, are unavailing. It also presented 7 evidence to support its position. (See generally Resp. Mot. Remand). The evidence, however, 8 lacked weight to meet its burden. That Defendant’s arguments lack merit does not justify 9 awarding attorney’s fees. Lussier,

. Thus, the Court denies Plaintiffs’ request 10 for attorney’s fees. 11 IV. CONCLUSION 12 IT IS HEREBY ORDERED that Plaintiffs’ Motion to Remand, (ECF No. 15), is 13 GRANTED. 14 IT IS FURTHER ORDERED that Defendant’s Motion for Leave to File Supplemental 15 Memorandum in Support of Defendant’s Opposition to Plaintiffs’ Motion to Remand, (ECF 16 No. 48), is DENIED. 17 IT IS FURTHER ORDERED that all other pending Motions, (ECF Nos. 10, 46, 59, 18 60, 99, 100, 101, 118, 130, 131, 135, 136, 140, 144), in this action are DENIED as moot. 19 IT IS FURTHER ORDERED that the Clerk is instructed to close this case. 20 DATED this __6___ day of August, 2022. 21 22 ___________________________________ Gloria M. Navarro, District Judge 23 UNITED STATES DISTRICT COURT 24 25