Elsa POLO, on behalf of herself and all others similarly situated, Plaintiff-Appellant, v. INNOVENTIONS INTERNATIONAL, LLC, a limited liability company, Defendant-Appellee.
No. 14-55916
United States Court of Appeals, Ninth Circuit.
Argued and Submitted May 4, 2016—Pasadena, California. Filed August 18, 2016
833 F.3d 1193
Thomas J. Peistrup (argued), Tantalo & Adler LLP, Los Angeles, California, for Defendant-Appellee.
Before: RAYMOND C. FISHER, MILAN D. SMITH, JR., and JACQUELINE H. NGUYEN, Circuit Judges.
M. SMITH, Circuit Judge:
Elsa Polo appeals the district court‘s grant of summary judgment in favor of Innoventions International, LLC (“Innoventions“). Polo originally filed suit in state court, but Innoventions removed the case to federal court pursuant to the Class Action Fairness Act of 2005 (CAFA), Pub. L. No. 109-2, 119 Stat. 4 (codified in scattered sections of
FACTS AND PRIOR PROCEEDINGS
Elsa Polo sued Innoventions in California state court. She alleged several causes of action, including four class claims. The gravamen of her complaint was that Innoventions had marketed a product called DiabeStevia with “grossly misleading and exaggerated claims” concerning its use and effectiveness—in particular, with the claim that it could be used to treat diabetes. Based upon Polo‘s allegation that the classes included “hundreds of customers,”
Polo went through several rounds of pleading before settling on a Third Amended Complaint (TAC). The TAC alleged, among other things, that Polo had beеn diagnosed with Type 2 diabetes; that Innoventions marketed DiabeStevia as a treatment for diabetes; that relying upon Innoventions‘s claims, Polo stopped taking her prescribed diabetes medication, and instead began treating her diabetes with DiabeStevia; and that DiabeStevia failed to perform as advertised, causing Polo to suffer “life threatening illness.” Based upon these and other allegations, Polo asserted nine different causes of action in her TAC.
Of those original nine causes of action, Polo appeals the dismissal of only one, her class-action claim for violations of California‘s Consumers Legal Remedies Act (CLRA),
On summary judgment, the district court found undisputed that Polo does not have diabetes, and that she had stopped taking her diabetes medication at least five months before she purchased and used DiabeStevia. Thus, the district court reasoned, Polo “cannot have been injured in the manner in which she alleges—that she became severely ill with diabetes symptoms in response to discontinuing her prescriptions in reliance on DiabeStevia.” With respect to Polo‘s CLRA claim, the district court found that Innoventions had undisputedly refunded Polo her еntire purchase price, including tax and shipping. As a result, the district court held that Polo lacked Article III standing for all of her claims, granted summary judgment in favor of Innoventions, and dismissed the case. This appeal followed.
JURISDICTION AND STANDARD OF REVIEW
We have jurisdiction pursuant to
ANALYSIS
On appeal, Polo does not dispute that she lacked Article III standing. Instead, she argues that upon making that determination, the district court was required to remand the case to state court, pursuant to
I. Removal without Jurisdiction
It is axiomatic that federal courts are courts of limited jurisdiction. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994). We are limited, by Congress and by the Constitution, in the subject matter of сases we may adjudicate. Id. State courts, by contrast, are not so limited. See Tafflin v. Levitt, 493 U.S. 455, 458-60, 110 S.Ct. 792, 107 L.Ed.2d 887 (1990). As a result, federal and state courts frequently have concurrent jurisdiction over a given case. See, e.g., id. (concerning federal claims); Colo. River Water Conservation Dist. v. United States, 424 U.S. 800, 809, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976) (concerning state-law claims with diverse parties). When this is so, a plaintiff may choose the court system in which she files suit—she is, as the old maxim declares, “master of [her] case.” See, e.g., Emrich v. Touche Ross & Co., 846 F.2d 1190, 1196 (9th Cir. 1988).
The availability of removal is an important check on the plaintiff‘s mastery. Removal permits a defendant to bring to federal court a suit initially filed in state court—if the federal court could have exercised originаl jurisdiction in the first instance.
Defects of subject-matter jurisdiction, however, are another matter. In an ordinary removal case, “[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.”
The rule that a removed case in which the plaintiff lacks Article III standing must be remanded to state court under
First, Innoventions relies on general maxims in our precedents, such as “a putative class action, once properly removed, stays removed.” See United Steel, Paper & Forestry, Rubber, Mfg., Energy, Allied Indus. & Serv. Workers Int‘l Union v. Shell Oil Co., 602 F.3d 1087, 1091 (9th Cir. 2010). Taken at face value, the stated maxim proves too much: It squarely contradicts the statutory language, which provides for remand of CAFA actions on
Second, Innoventions argues that the failure of a claim on the merits does not divest a court of jurisdiction. While this is generally true, see Bell v. Hood, 327 U.S. 678, 682, 66 S.Ct. 773, 90 L.Ed. 939 (1946), the рoint is irrelevant here. The district court expressly determined that Polo‘s claims failed for lack of standing. The district court‘s factual determinations—that Polo did not have diabetes and that Innoventions did not cause her to stop taking her diabetes medication—could have served as a basis for judgment on the merits of some of her other claims, such as her claim for personal injury. However, as we shall presently explain, Polo‘s CLRA claim is independent of those facts. See infra Part II. According to the district court, that claim was rendered “moоt” when Innoventions refunded Polo the money she spent on DiabeStevia. It rendered no judgment on the merits of that claim.
Finally, Innoventions argues that because Polo‘s lack of injury was established as part of the summary-judgment process, it was established at final judgment, rather than “before final judgment” as required by
II. The Futility Doctrine and the CLRA
Innoventions also argues that despite the literal words of
In International Primate Protection League v. Administrators of Tulane Educational Fund, 500 U.S. 72, 88-89, 111 S.Ct. 1700, 114 L.Ed.2d 134 (1991), decided a few months after we decided Bell, the Supreme Court declined to apply a futility exception to the remand rule. Although the Court did not reject the futility doctrine
Even applying the Bell rule, however, a district court must have “absolute certainty” that a state court would “simply dismiss[] the action on remand.” 922 F.2d at 1425 (quotation marks omitted). In other words, only when the eventual outcome of a case after remand is so clear as to bе foreordained have we held that a district court may dismiss it to “prevent[] any further waste of valuable judicial time and resources.” Id. It is far from clear that a state court would dismiss Polo‘s CLRA claim.
A plaintiff who purchased goods in light of deceptive practices has standing to sue pursuant to the CLRA if she alleges (a) that she purchased a product from the defendant, and (b) that “the purchase would not have been made but for the misrepresentation.” Kwikset Corp. v. Superior Court, 51 Cal.4th 310, 120 Cal.Rptr.3d 741, 246 P.3d 877, 890 (2011); see also Hinojos v. Kohl‘s Corp., 718 F.3d 1098, 1108 (9th Cir. 2013). The injury Polo asserts with respect to her CLRA claim fits these requirements:
Plaintiff and Californiа Class members suffered injuries caused by Defendants’ misrepresentations about DiabeStevia because: (a) Plaintiff and the California Class members would not have purchased DiabeStevia on the same terms had they known the true facts; (b) Plaintiff and the California Class paid a prеmium price due to the false and misleading advertising of DiabeStevia; and (c) DiabeStevia did not have the level of safety, quality, effectiveness or value as promised.
Polo‘s standing to bring her CLRA claim does not depend upon her allegation that taking DiabeStevia made her diabetes worse. Indeed, with respect to Polo‘s CLRA claim, when Polo ceased taking her diabetes medication—or whether she had diabetes at all4—is irrelevant. What matters are her allegations that she thought she had diabetes; that Innoventions marketed DiabeStеvia as a treatment for diabetes; and that but for that marketing, she would not have bought DiabeStevia.
Were that the end of the allegations, Polo would likely have standing under Article III. See Hinojos, 718 F.3d at 1104 n.3. But the district court held that because Innoventions fully compensated Polo for “her entirе purchase price,” her CLRA claim is moot.5 Under California law, however, that sort of “picking off” of class plaintiffs is ineffective: “[O]nce a person has been the victim of a proscribed practice under the CLRA and makes a demand on behalf of a class, remеdying the plaintiff‘s individual complaint does not disqualify her as class representative.” Meyer v. Sprint Spectrum, L.P., 45 Cal.4th 634, 88 Cal.Rptr.3d 859, 200 P.3d 295, 300 (2009).
Polo made a demand on behalf of a class on April 6, 2012. Innoventions refunded Polo‘s purchase price on May 11, 2012, but does not contend that it provided the notice and remеdy to class members required by the CLRA. See
CONCLUSION
The district court‘s judgment dismissing this case is REVERSED and REMANDED.