Judge: Colin Leis, Case: BC620880, Date: 2023-10-27 Tentative Ruling

Case Number: BC620880    Hearing Date: October 27, 2023    Dept: 74

Case Number: BC620880     Hearing: October 27, 2023    Dept: 74

Daniel Veloz v. Sears, Roebuck and Co., et al.

Motion to Dismiss

The court considered the moving papers, opposition, and reply.

BACKGROUND 

            This action arises from an employment dispute.

            On May 17, 2016, Plaintiff Daniel Veloz (Plaintiff) filed a complaint against Defendant Sears, Roebuck and Co. (Defendant).

            On August 10, 2016, Defendant removed this action to federal court on the basis of diversity jurisdiction.

            On June 29, 2017, the jury returned a verdict in favor of Defendant on the first six questions related to Plaintiff’s FEHA and CFRA claims. On July 13, 2017, the federal court granted judgment as a matter of law for Defendant on Plaintiff’s claim for intentional infliction of emotional distress.

            On February 7, 2018, Plaintiff filed an appeal.

            On October 16, 2018, Defendant filed with the Ninth Circuit a notice of bankruptcy filing and imposition of automatic stay.

            On October 7, 2019, the Bankruptcy Court approved confirmation of Defendant’s Second Amended Joint Chapter 11 Plan.

            On August 30, 2023, Defendant filed this motion to dismiss.

DISCUSSION 

            Defendant argues the court should dismiss this action because it lacks jurisdiction. Once this action was removed to federal court, this court’s jurisdiction was suspended. (Allstate Ins. Co. v. Superior Court (1982) 132 Cal.App.3d 670, 675.) For this court to resume jurisdiction, the federal court must remand the action. (Ibid.) As Defendant notes, the federal court closed this action in light of Defendant’s Second Amended Joint Chapter 11 Plan. (Brophy Decl., ¶ 17; Ex. C.) The federal court based its decision on section 15.8 of the plan, which permanently enjoins Plaintiff, as an unsecured creditor, from pursuing his claims outside the remedies provided under the plan. (Brophy Decl., ¶ 17; Ex. C.) Consequently, the federal court cannot remand this action so that Plaintiff can pursue his claims. As a further consequence, this court cannot resume jurisdiction. Plaintiff in turn argues the case is ripe to proceed in this court because Defendant voluntarily divested the federal court of jurisdiction when it obtained the closure. But Plaintiff does not provide any authority in support. By contrast, courts have held that a state court may resume its jurisdiction in this context “if—but only if—there is a remand of the action to it from the federal court.” (Allstate Ins. Co. v. Superior Court, supra, 132 Cal.App.3d at p. 675.)

CONCLUSION

            Based on the foregoing, the court grants Defendant’s motion to dismiss.

Defendant is ordered to give notice.