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Ambrose v. Grindell & Romero Insurance, Inc.

United States District Court, D. New Mexico

February 23, 2018



          STEPHAN M. VIDMAR, United States Magistrate Judge

         THIS MATTER is before me on Plaintiffs' Motion to Remand, filed on July 3, 2017.

         [Doc. 8]. Defendants responded on July 17, 2017. [Doc. 11]. Plaintiffs replied on July 26, 2017. [Doc. 12]. The Honorable Martha Vázquez, United States District Judge, referred this matter to me for analysis and a recommended disposition. [Doc. 14]. Having considered the briefing, relevant portions of the record, and relevant authorities, and being otherwise fully advised in the premises, I recommend that Plaintiff's Motion to Remand be granted and that the case be remanded to the Third Judicial District Court, Doña Ana County. I further recommend that Plaintiffs be awarded reasonable expenses in connection with their motion.


         Plaintiffs are former employees of Defendant Grindell & Romero Insurance, Inc. (“GRI”), of which Defendant Abercrombie is the CEO. Plaintiff Ambrose filed the instant action in state court in the Third Judicial District, Doña Ana County, on May 22, 2017. [Doc. 1-3] at 1. The Complaint alleged that Defendants engaged in pervasive sexual harassment and discrimination against “several” of their female employees, including Plaintiff Bonnie Ambrose and Tiffany Selleck. Id. The Complaint set forth two counts of gender discrimination and retaliation in violation of the New Mexico Human Rights Act (“NMHRA”), NMSA 1978, § 28-1-7(A). Id. at 16-19. Plaintiffs filed their First Amended Complaint on June 2, 2017. [Doc. 1-2]. The First Amended Complaint adds as parties Plaintiffs Selleck and Portillo-Garcia and adds four additional counts. As to Plaintiff Portillo-Garcia, it alleges NMHRA claims based on age discrimination, race/national origin discrimination, and wrongful termination. [Doc. 1-2] at 29-33. And as to Plaintiff Selleck, it alleges failure to pay due wages pursuant to NMSA 1978, § 50-4-4. In total, the First Amended Complaint alleges six counts under the NMHRA and § 50-4-4.

         Defendants removed the case to this Court on June 28, 2017, citing the existence of federal-question jurisdiction under 28 U.S.C. § 1331. [Doc. 1]. Though Plaintiffs allege violations of state law only, Defendants argued their claims “raise issues that are necessarily ones of federal law, ” namely Title VII of the Civil Rights Act of 1964 (“Title VII”), 42 U.S.C. § 2000e, and the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C. § 621. Id. at 3.

         Plaintiffs filed the instant motion to remand on July 3, 2017. [Doc. 8]. Plaintiffs contend that the case was wrongfully removed because it involves no federal claims. As an initial matter, Plaintiffs argue that Defendants are not subject to Title VII or the ADEA because they do not employ at least fifteen people. Therefore, Plaintiffs suggest, they could not have asserted those federal claims in the first instance. Id. at 1, 5. Moreover, the plaintiff is “master of his or her complaint” and may avoid federal jurisdiction by relying exclusively on state law. Id. at 7 (internal quotations omitted). Plaintiffs argue they have done just that-they have asserted only state-law claims and expressly disavowed any federal claims. They argue that merely citing to federal case law in a pleading, as they have done, does not confer federal jurisdiction. Id. at 5-7. At bottom, they have stated claims under state law alone, and their right to relief does not “necessarily depend[] on resolution of a substantial question of federal law.” Id. at 3 (internal quotations omitted). Plaintiffs further request attorney's fees in connection with their motion. Id. at 8-9.

         In response, Defendants maintain that recent Supreme Court case law makes clear that having fewer that fifteen employees does not create a bar to federal jurisdiction. [Doc. 11] at 1- 3 (citing Arbaugh v. Y&H Corp., 546 U.S. 500 (2006)). The thrust of their argument, though, is that Plaintiffs' numerous references to federal case law interpreting Title VII and the ADEA confer federal jurisdiction. See Id. at 4-10. They argue that Plaintiffs should not be permitted to seek “all of the presumptions and potential benefits that could only be conferred upon them by federal law, ” on the one hand, while still avoiding federal jurisdiction on the other. Id. at 9. Defendants rely on the so-called “artful pleading” doctrine, which provides that a party cannot defeat federal question jurisdiction by couching his or her complaint in terms of state law, where the claims are actually federal in nature or necessarily depend on federal law for their resolution.

         Legal Standards

         Pursuant to 28 U.S.C. § 1441, an action may be removed from state to federal court when the federal court has “original jurisdiction” over the action because it is founded on a claim or right “arising under” federal law. “Only state-court actions that originally could have been filed in federal court may be removed to federal court by the defendant. Absent diversity of citizenship, federal-question jurisdiction is required.” Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987).

         To determine whether an action “arises under” federal law-i.e., whether federal-question jurisdiction exists-courts follow the “well-pleaded complaint” rule. Id.; Devon Energy Prod. Co. v. Mosaic Potash Carlsbad, Inc., 693 F.3d 1195, 1202 (10th Cir. 2012). That is, courts determine whether a federal question is presented “on the face of the plaintiff's properly pleaded complaint.” Caterpillar, 482 U.S. at 392. “A case ‘arises under' federal law under two circumstances: ‘a well-pleaded complaint establishes either that federal law creates the cause of action or that the plaintiff's right to relief necessarily depends on resolution of a substantial question of federal law.'” Gilmore v. Weatherford, 694 F.3d 1160, 1170 (10th Cir. 2012) (quoting Empire Healthchoice Assurance, Inc. v. McVeigh, 547 U.S. 677, 690 (2006)). “Th[is] rule makes the plaintiff the master of the claim; he or she may avoid federal jurisdiction by exclusive reliance on state law.” Caterpillar, 482 U.S. at 392. “[T]he plaintiff may, by eschewing claims based on federal law, choose to have the cause heard in state court.” Id. at 400.

         The well-pleaded complaint rule is not absolute. Under the so-called “artful pleading” doctrine, “a plaintiff may not defeat removal by failing to plead federal questions that are essential elements of the plaintiff's claim.” Turgeau v. Admin. Review Bd., 446 F.3d 1052, 1060-61 (10th Cir. 2006) (internal quotation marks omitted); see also Franchise Tax Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 22 (1983). When the artful pleading doctrine is invoked, the court must determine whether the state-law claims are completely preempted by federal law or implicate substantial, disputed federal questions. Devon Energy, 693 F.3d at 1203-04.

         Because federal courts are courts of limited jurisdiction, there is a presumption that no federal jurisdiction exists “absent an adequate showing by the party invoking federal jurisdiction.” United States ex. rel. Hafter v. Spectrum Emer. Care, Inc., 190 F.3d 1156, 1160 (10th Cir. 1999). Thus, in a removed case, the burden is on the defendant to demonstrate the propriety of removal from state to federal court. See Id. Federal courts strictly construe ...

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