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Habacon v. Emerald Grande, LLC

United States District Court, D. Nevada

April 12, 2019

EILEEN HABACON, an individual, Plaintiff,
v.
EMERALD GRANDE, LLC, a Florida Corporation and WYNDHAM VACATION RESORTS, INC., a Delaware Corporation, Defendants.

          ORDER

          MIRANDA M. DU UNITED STATES DISTRICT JUDGE

         I. SUMMARY

         The parties in this case dispute whether Defendants Emerald Grande, LLC (“Emerald”) and Wyndham Vacation Resorts, Inc. (“Wyndham”) (collectively, “Defendants”) pressured and deceived Plaintiff Eileen Habacon into purchasing a timeshare interest. Before the Court is Plaintiff's motion to remand (“Motion”). (ECF No. 10.) The Court has reviewed Defendants' response (ECF No. 14). No. reply was filed. For the following reasons, the Court grants Plaintiff's Motion and remands this case to the Eighth Judicial District Court.

         II. BACKGROUND

         The following allegations come from the Complaint unless otherwise indicated. (ECF No. 3-1.)

         Plaintiff alleges that Defendants pressured and deceived her into purchasing a timeshare interest. (Id. at 6.) According to the Complaint, Plaintiff agreed to attend a two-hour timeshare presentation that ended up lasting five hours and culminated in the execution of a contract (“Contract”) for the purchase of a timeshare interest in September 2015. (Id. at 7-8.) The parties agreed that the purchase price of the timeshare was $17, 679. (Id. at 9; ECF No. 14 at 3.) Plaintiff paid for the timeshare with a down payment in the amount of $2, 677.35, and a loan in the amount of $15, 001.65, financed through Emerald. (ECF No. 3-1 at 9-10; ECF No. 14 at 3.) Plaintiff has paid an additional $9, 314.76 in principal and interest payments as well as $1, 970.61 in maintenance and other fees. (ECF No. 14 at 4.) At the time the Complaint was filed, Plaintiff had paid a total of $13, 962.72 for her timeshare. (Id. at 4.) The parties seem to agree that the Contract obligates Plaintiff to pay the remaining principal and interest ($19, 346.04) as well as future maintenance fees for the timeshare ($4, 442.04). (Id. at 5; see ECF No. 10 at 5 (discussing the remaining principal and interest and failing to dispute that future maintenance fees are contractually obligated as well).)

         Plaintiff filed her Complaint in the Eighth Judicial District Court (ECF No. 3-1 at 4), and Defendants removed based on diversity jurisdiction (ECF No. 3 at 2).

         Plaintiff asserts the following claims in the Complaint: (1) violation of various provisions of the Nevada Deceptive Trade Practices Act, NRS Ch. 598; (2) violation of NRS Ch. 119A.710 related to time shares; (3) fraud in the inducement; (4) negligent misrepresentation; (5) breach of implied covenant of good faith and fair dealing; and (6) violation of the Florida Vacation Plan and Timesharing Act, Fla. Stat. § 721.02 et seq. (ECF No. 3-1 at 10-17.) Plaintiff seeks rescission of the Contract as well as actual damages, punitive damages, civil penalties, treble damages, and attorneys' fees. (Id. at 12-13, 18.)

         III. LEGAL STANDARD

         Federal 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 at commencement of the action. 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).

         To 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, 1117 (9th Cir. 2004).

         Under a 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 (citation omitted).

         IV. DISCUSSION

         Plaintiff does not request a specific amount of damages in the Complaint. (See generally ECF No. 3-1.) Thus, Defendants must prove, by a preponderance of the evidence, that the amount in controversy requirement is satisfied. Valdez, 372 F.3d at 1117. Defendants have not made this showing. Defendants argue that the amount in controversy exceeds $75, 000 based on (1) the amount Plaintiff has already paid for her timeshare ($13, 962.72); (2) the remaining principal and interest on Plaintiff's loan ($19, 346.04); (3) future maintenance fees for the timeshare ($4, 442.04); (4) punitive damages; (5) attorneys' fees between $35, 000 and $70, 000; and (6) treble damages and civil penalties. (ECF No. 14 at 3-8.) The Court finds that the amount in controversy consists of the first three amounts plus Defendants' low-end estimate of ...


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