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Bonner v. Leon

United States District Court, D. Nevada

July 16, 2014

LAWRENCE S. BONNER, Plaintiff,
v.
CARLOS LEON, et al., Defendants.

ORDER REMANDING CASE TO STATE COURT (DOC. #33)

ANDREW P. GORDON, District Judge.

I. SUMMARY

Before the Court is Plaintiff Lawrence Bonner's Petition for Remand for lack of jurisdiction. (Doc. #33.) The Court has also considered the opposition filed by Defendants American Bankers Insurance Company of Florida ("American Bankers"), American Collectors Insurance, Inc. ("American Collectors"), and Assurant, Inc. ("Assurant")(collectively "Insurance Defendants") (doc. #35), and Plaintiff's reply (doc. #36). For the reasons discussed below, the motion is granted in part and denied in part.

II. BACKGROUND

The following facts are taken from Plaintiff's Complaint. In 2010, Plaintiff, a long-time classic car enthusiast, delivered a 1964 Chevy Nova to Nevada Defendant C&H Soda Blasting ("C&H") for automotive restoration and repair. Nevada Defendants Carlos and Carla Leon (collectively "Leon Defendants") own C&H.[1] Although there was no written estimate for the work, Plaintiff was satisfied with the verbal estimates of cost and length of time for the repairs. Over the course of time, Plaintiff made several payments for the car repair, and gave personal loans to the Leon Defendants, to facilitate timely repair. Plaintiff expected the repairs to take one year.

In 2011, Plaintiff grew concerned that Mr. Leon was not working on the car and demanded that Mr. Leon return the vehicle regardless of the state of completion. On March 14, 2012, after Plaintiff's multiple attempts to retrieve the vehicle and Mr. Leon's numerous false promises that it would be returned, Plaintiff filed a police report detailing the surrounding events. The police department advised Plaintiff to file a lawsuit to retrieve the car.

On March 15, 2012, after filing the police report, Plaintiff contacted Insurance Defendants about Mr. Leon's actions. However, Insurance Defendants refused to allow Plaintiff to make a claim. Insurance Defendants told Plaintiff that the police department's lack of involvement was evidence that the car was not stolen. Thus, Plaintiff focused his efforts on Mr. Leon to attempt to retrieve the car.

In July 2012, Carlos Leon filed for bankruptcy.[2] At this point, fearful that the car would be implicated in the bankruptcy, Plaintiff enlisted the services of a law firm. However, Mr. Leon still did not return the car. Plaintiff assumed that Mr. Leon sold, abandoned, destroyed, lost, or converted the car. Thus, around February 2013, the law firm then sent a letter to Insurance Defendants requesting that Plaintiff be allowed to file a claim. Insurance Defendants again refused to allow Plaintiff to make a claim. Over the course of multiple communications extending well into April 2013, Insurance Defendants would not allow Plaintiff to make a claim, nor did they undertake any investigation. Instead, Insurance Defendants told Plaintiff to make another police report, get the police to investigate the vehicle as stolen, or call it stolen in the police report. Plaintiff's attorneys again attempted to retrieve the vehicle from Mr. Leon to no avail.

On August 8, 2013, Plaintiff sued the Leon and Insurance Defendants in Nevada state court. The claims against the Leon Defendants assert deceptive trade practices, breach of contract, breach of the implied covenant of good faith and fair dealing, conversion, civil RICO, intentional misrepresentation, and unjust enrichment. Plaintiff seeks money damages and a preliminary injunction for the return of the vehicle, or information of the location of the vehicle and its state of repair.

The claims against the Insurance Defendants assert breach of contract, breach of the implied covenant of good faith and fair dealing, unfair claims practices, and unjust enrichment. Plaintiff seeks money damages and declaratory relief.

Insurance Defendants removed the case to this Court based on both diversity jurisdiction and federal question (based on the Leon Defendants' pending bankruptcy case under 28 U.S.C. § 1334(a)). Plaintiff now moves to remand the case arguing the Mechanic Defendants' presence in the suit destroys complete diversity, and the pending bankruptcy does not vest this court with jurisdiction.

III. MOTION TO REMAND

A defendant may remove an action to federal court if the plaintiff could have initially filed the complaint in federal court. 28 U.S.C. § 1441(a). When reviewing a motion to remand, a district court must analyze jurisdiction "on the basis of the pleadings filed at the time of removal." Sparta Surgical Corp. v. Nat'l Ass'n of Sec. Dealers, Inc., 159 F.3d 1209, 1213 (9th Cir. 1998). Federal district courts have diversity jurisdiction over cases in which there is (1) complete diversity of citizenship among opposing parties and (2) the amount in controversy exceeding $75, 000. 28 U.S.C. § 1332(a).

When a debtor files a bankruptcy petition, an automatic stay immediately arises. 11 U.S.C. § 362(a). The scope of the stay is quite broad. In re Stringer, 847 F.2d 549, 551 (9th Cir. 1988). The automatic stay precludes and nullifies post-petition actions, judicial or nonjudicial, in nonbankruptcy against the debtor or affecting the property of the estate. Hillis Motors, Inc. v. Haw. Auto. Dealers' Ass'n, 997 F.2d 581, 585 (9th Cir. 1993). This includes all claims "that [were] or could have been commenced before the commencement of the [bankruptcy] case..., or to recover a claim against the debtor that arose before the commencement of the [bankruptcy] case...." 11 U.S.C. § 362(a)(1). Any claim made in violation of the automatic stay is void ab initio. In re ...


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