Plaintiff Kenneth J. Rader (“Rader”) filed his complaint in the Superior Court of California, County of San Francisco, alleging claims against Defendant Sun Life Assurance Company of Canada (“Sun Life”) for breach of contract and breach of the covenant of good faith and fair dealing with regard to his group disability insurance policy, and against Defendant Dave Jones, California Insurance Commissioner (“the Commissioner”), for a writ of mandamus on account of his approval of the policy allegedly in contravention of provisions of the California Insurance Code. Sun Life removed the action to this Court by Notice of Removal filed February 8, 2013, on grounds of diversity jurisdiction under 28 U.S.C. § 1441(a), contending that the Commissioner is a sham defendant. (Dkt. No. 1, Notice of Removal [“NOR”].) Rader has filed a Motion to Remand the action to the state court. (Dkt. No. 7.)
Having carefully considered the papers submitted and the pleadings in this action, and for the reasons set forth below, the Court hereby Grants the Motion to Remand.
BACKGROUND
Rader’s complaint alleges breach of contract and breach of the covenant of good faith and fair dealing against Sun Life. It also alleges a claim for a writ of mandamus against the Commissioner on the grounds that he abused his discretion by approving the policy Sun Life issued since it included provisions violating California law, including: (1) conditioning payment of disability benefits without regard to whether the insured is able to perform the substantial and material duties of his own occupation with reasonable continuity and in the usual and customary way; (2) limiting benefits payable for disabilities due to drug and alcohol illness and mental disabilities where there is no evidence that such limitations are based on sound actuarial principals or reasonably anticipated experience, in violation of California Insurance Code section 10144; and (3) a Proof of Claim provision that purportedly requires the contemporaneous submission of treatment records that would allow Sun Life to withhold benefits even where, as here, the disability is established by the certifications and statements of treating physicians. Each of these limitations, Rader claims, violates California law and should not have been approved by the Commissioner.
Sun Life contends that the Commissioner was fraudulently joined by Rader in order to defeat diversity jurisdiction and should be disregarded. In its Notice of Removal, Sun Life argued four bases for removal. First, Sun Life contended that the requested writ of mandamus is not legally cognizable under California law because mandamus only lies to compel a clear, present, ministerial duty per California Code of Civil Procedure section 1085. Because the Commissioner’s enforcement of the Insurance Code sections at issue in the Complaint involves the exercise of his discretion, the writ relief sought cannot be granted. Second, Sun Life argued that no basis exists for the Court to order the remedy Rader seeks because the Commissioner only has the authority to withdraw his approval of a disability policy form on a prospective basis, not to revoke or rescind a previously approved group disability pol
APPLICABLE STANDARD
A plaintiff may seek to have a case remanded to the state court from which it was removed if the district court lacks jurisdiction or if there is a defect-in the removal procedure. 28 U.S.C. § 1447(c). The removal statutes are construed restrictively, so as to limit removal jurisdiction. Shamrock Oil & Gas Corp. v. Sheets,
A non-diverse party named in a complaint can be disregarded for purposes of determining whether original diversity jurisdiction exists if a district court determines that the party’s inclusion in the action is a “sham” or “fraudulent.” McCabe v. General Foods Corp.,
ANALYSIS
A. Intent To Pursue Writ Claim
In order to meet its burden to establish removal jurisdiction, Sun Life must show that there is no possibility that Rad-er can state a claim against the Commissioner. “[T]he motive for joining such a defendant is immaterial.” Fink v. Unumprovident Corp., C 05-2875 CW,
With respect to the propriety of a writ claim, Sun Life concedes that writ relief under Section 1085 of the California Code of Civil Procedure will lie to compel a ministerial act or to correct an abuse of discretion such as a failure to comply with governing law. See California Assn. for Health Servs. at Home v. State Dep’t of Health Care Servs.,
The viability of such a claim has been recognized by the California courts, the Ninth Circuit Court of Appeal, as well as the federal district courts of the Northern District of California. See Van Ness v. Blue Cross of California,
C. Effect On Plaintiff
Sun Life further contends that the writ claim against the Commissioner is a sham because any action by the Commissioner would only be prospective in nature, and would not affect Rader’s existing policy. Rader counters with three arguments. First, Rader persuasively argues that the Commissioner’s withdrawal of approval of the policy form here would actually benefit him because it could affect his ongoing claim for (future) disability payments. Second, Insurance Code section 10291.5(h) clearly authorizes the Court to review any of the Commissioner’s actions. Cf. Blake,
D. Adequate Remedy At Law
Sun Life also argues that Rader has an adequate remedy at law such that writ relief is not available. However, Sun Life seems to confuse the issue since it argues that Rader can get the same relief by way of his claims against Sun Life. Plainly success in Rader’s claims against Sun Life will not result in the Commissioner’s withdrawal of approval of his policy form. Sun Life’s argument that Rader is not required to seek withdrawal of the Commissioner’s approval in order to enforce California law appears to be beside the point. Rader has no other plain, speedy and adequate remedy as against the Commissioner. See Brazina v. Paul Revere Life Ins. Co.,
E. New Arguments Raised in Opposition
Sun Life raises a new argument in its opposition to the Motion to Remand, namely that the Insurance Code sections Rader alleges were violated do not apply to group disability policies.
CONCLUSION
Based upon the foregoing, the Motion to Remand is Granted. The instant action is Remanded to the Superior Court of California, County of San Francisco.
It Is So Ordered.
Notes
. Pursuant to Federal Rule of Civil Procedure 78(b) and Civil Local Rule 7 — 1 (b), the Court finds this motion appropriate for decision without oral argument. Accordingly, the Court Vacates the hearing set for April 30, 2013.
. Even if Rader’s intention to pursue his claim against the Commissioner was a legitimate consideration, Sun "Life’s argument that he has no intention of pursuing the writ claim is without any persuasive evidence to support it. As Rader notes, the dockets in the prior cases cited by Sun Life do not indicate whether the claims against the Commissioner were pursued to settlement.
. Sun Life argues that the cases supporting the viability of such a writ claim were wrongly decided, based upon dicta in Peterson. Dicta or no, the decision in Peterson correctly noted that an individual insured can seek writ relief if, as here, he alleges "that the Commissioner has abused his discretion by approving a policy in violation” of California law. Peterson,
. Rader points out another argument raised in the opposition that was not stated in the NOR. The argument — that discretionary action cannot be compelled since the Commissioner's authority to revoke approval of a policy pursuant to 12957 of the Insurance Code is discretionary — -appears to be nothing more than a variant of the more general argument, supra, that the Commissioner cannot be compelled by a writ to exercise his discretion. As stated above, the allegations of the complaint are that the Commissioner abused his discretion, a cognizable basis for writ relief under California Code of Civil Procedure section 1085; see also Cal. Ins.Code § 12940 ("[t]he acts and orders of the commissioner are subject to such review, or other action by a court of competent jurisdiction, as permitted or authorized by law”).