Heavens Allstar Inc v. Mercedes-Benz USA LLC
2:25-cv-04683
C.D. Cal.Jun 2, 2025Background
- Plaintiffs (Heavens Allstar Inc., et al.) filed an action against Defendants (Mercedes-Benz USA, LLC, et al.) in federal court.
- The case was removed to federal court by Defendants, who asserted diversity jurisdiction under 28 U.S.C. § 1332(a).
- Federal courts require complete diversity and an amount in controversy exceeding $75,000 for subject matter jurisdiction.
- The court, upon initial review, could not determine from the Notice of Removal whether the $75,000 amount in controversy requirement has been met.
- The court sua sponte issued an Order to Show Cause, requiring both parties to provide evidence or arguments as to whether the jurisdictional threshold has been satisfied.
- Defendant, as the removing party, bears the burden to prove jurisdiction; a failure to do so will result in remand to state court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Amount in controversy exceeds $75,000 | Not specified in order | Removal notice alleges it does | Court finds insufficient evidence; |
| requires parties to show cause | |||
| Subject matter jurisdiction exists | Not specified | Asserts diversity jurisdiction | Court questions jurisdiction, seeks |
| under §1332(a) | additional proof from both parties | ||
| Burden of proof for removal | Not specified | Removal notice sufficient | Defendant must prove by preponderance |
| Consequence if burden not met | Remand to state court | Retain federal jurisdiction | Action will be remanded |
Key Cases Cited
- Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (Federal courts possess only power authorized by Constitution and statute)
- DaimlerChrysler Corp. v. Cuno, 547 U.S. 332 (Jurisdiction must appear affirmatively from the record)
- Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574 (Courts must address jurisdiction before merits)
- Dart Cherokee Basin Operating Co. v. Owens, 574 U.S. 81 (Amount in controversy must be plausible and proven by evidence if challenged)
- Gaus v. Miles, Inc., 980 F.2d 564 (Federal jurisdiction must be rejected if any doubt exists regarding removal)
- Leite v. Crane Co., 749 F.3d 1117 (Establishes facial and factual inquiry standards for removal jurisdiction)