United States District Court, D. Nevada
ORDER (PLAINTIFF'S MOTION TO REMAND - ECF NO.
MIRANDA M. DU UNITED STATES DISTRICT JUDGE.
case comes before this Court through Defendant Allan
Holms' (“Allan”) Notice of
Removal. (ECF No. 1.) Defendant Manuel Graiwer
filed a Joinder and Consent to the Notice of Removal. (ECF
No. 24.) Plaintiff Bakken Resources, Inc.
(“Bakken”) filed this action in the Second
Judicial District Court in Washoe County, Nevada, alleging a
variety of fraudulent misconduct by Defendants. (ECF No.
1-2.) Bakken now seeks to remand and to obtain an award of
costs and fees, contending that Allan lacked an objectively
reasonable basis for removal. For the reasons discussed
below, Bakken's Motion is granted in part and denied in
part. Bakken's request for remand is granted and its
request for fees and costs is denied.
originally filed suit in the Second Judicial District Court,
seeking injunctive and declaratory relief against Allan,
damages from Graiwer,  and attorney fees and costs from both
defendants. (ECF No. 1-2.) The Court need not recount the
long and winding history between the parties for the purposes
of this Order, suffice to say that, generally, Bakken alleges
Allan is attempting a hostile takeover of the company through
fraud. More specifically, Bakken alleges that Allan is
attempting to obtain his deceased brother Val's shares of
the company through, among other inconsistencies, producing
documents containing forged signatures. (Id. at
8-15.) Additionally, Bakken alleges that Allan filed a form
with the Securities and Exchange Commission
(“SEC”) containing false information - namely
representing himself as president and a director of the
company. (Id. ¶¶ 61-63.) Bakken seeks to
enjoin Allan from transferring a number of shares to himself
and from filing any additional documents with the SEC
indicating that he is “an officer, director, or ten
percent (10%) shareholder” of the company.
(Id. at 23-24.)
Notice of Removal, Allan identifies diversity between the
parties as the basis for removal and claims that the amount
in controversy requirement is met because the combination of
monetary damages, attorney fees, and the cost of complying
with Bakken's requested injunction would exceed $75, 000.
(ECF No. 1 at 2.) In support of his assertion, Allan cites
In re Ford Motor Co./Citibank (S. Dakota), N.A., 264
F.3d 952, 958 (9th Cir. 2001), where the Ninth
Circuit reiterated and applied the rule that the cost of
complying with injunctive relief can satisfy the amount in
controversy requirement for diversity jurisdiction.
moves to remand based on its contention that the amount in
controversy does not exceed $75, 000, as required by 28
U.S.C. § 1332. (ECF No. 34.) The central dispute between
the parties, and the question for the Court, is whether
Bakken's request for injunctive relief will
“cost” Allan the alleged $3, 148, 200 value of
the stock at issue, or whether, since Allan does not
currently have any ownership interest in the stock, complying
with an injunction will only cost him some negligible amount.
Because Bakken only seeks injunctive and declaratory relief
against Allan, the question of subject matter jurisdiction
turns on whether the Court considers the alleged value of the
stock as part of the amount in controversy.
courts are courts of limited jurisdiction, having
subject-matter jurisdiction only over matters authorized by
the Constitution and Congress. U.S. Const. art. III, §
2, cl. 1; e.g., Kokkonen v. Guardian Life Ins.
Co. of Am., 511 U.S. 375, 377 (1994). A suit filed in
state court may be removed to federal court if the federal
court would have had original jurisdiction over the suit. 28
U.S.C. § 1441(a). However, courts strictly construe the
removal statute against removal jurisdiction, and
“[f]ederal jurisdiction must be rejected if
there is any doubt as to the right of removal in the first
instance.” Gaus v. Miles, Inc., 980 F.2d 564,
566 (9th Cir. 1992) (emphasis added). The party seeking
removal bears the burden of establishing federal
jurisdiction. Durham v. Lockheed Martin Corp., 445
F.3d 1247, 1252 (9th Cir. 2006).
establish subject matter jurisdiction pursuant to diversity
of citizenship under § 1332(a), the party asserting
jurisdiction must show: (1) complete diversity of citizenship
among opposing parties and (2) an amount in controversy
exceeding $75, 000. 28 U.S.C. § 1332(a). Where it is not
facially evident from the complaint that $75, 000 was in
controversy at the time of removal, a defendant seeking
removal must prove, by a preponderance of the evidence, that
the amount in controversy requirement is met. Valdez v.
Allstate Ins. Co., 372 F.3d 1115 (9th Cir. 2004).
preponderance of the evidence standard, a removing defendant
must “provide evidence establishing that it is
‘more likely than not' that the amount in
controversy exceeds” the jurisdictional minimum.
Id. at 1117 (citations omitted). As to the kind of
evidence that may be considered, the Ninth Circuit has
adopted the “practice of considering facts presented in
the removal petition as well as any ‘summary-judgment-
type evidence relevant to the amount in controversy at the
time of removal.'” Matheson v. Progressive
Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003)
(quoting Singer v. State Farm Mut. Auto. Ins. Co.,
116 F.3d 373, 377 (9th Cir. 1997)). Conclusory allegations
are insufficient. Matheson, 319 F.3d at 1090
argues that it is only seeking injunctive and declaratory
relief against Allan, and is not asserting any ownership
interest in the stock, therefore the value of the stock is
not relevant to the amount in controversy analysis. (ECF No.
44 at 6-7.) In particular, Bakken seeks to enjoin Allan from
transferring shares of stock or filing “additional
documents with the SEC that purport, indicate or in any way
claim that Allan is either an officer, director, or ten
percent (10%) shareholder of [Bakken].” (ECF No. 1-2
¶ 86.) Bakken characterizes the object of the litigation
as a request for “Plaintiff to conduct its business
affairs as a publicly traded corporation free from the
interference and ...