Jeff Jonah v. Kimberly-Clark Corporation et al

Northern District of California, cand-4:2015-cv-03243

NOTICE OF REMOVAL OF DEFENDANTS from Superior Court of San Mateo. Their case number is CIV534157. (Filing fee $400 receipt number 0971-9673217). Filed by Kimberly-Clark Global Sales, LLC., Kimberly-Clark Worldwide, Inc. Modified on 7/14/2015

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1 Amy P. Lally, SBN 198555 alally@sidley.com 2 Darlene M. Cho, SBN 251167 dcho@sidley.com 3 SIDLEY AUSTIN LLP 555 West Fifth Street, Suite 4000 4 Los Angeles, California 90013 Telephone: (213) 896-6000 5 Facsimile: (213) 896-6600 6 Attorneys for Defendants 7 KIMBERLY-CLARK GLOBAL SALES, LLC; and KIMBERLY-CLARK 8 WORLDWIDE, INC. 9 UNITED STATES DISTRICT COURT 10 FOR THE NORTHERN DISTRICT OF CALIFORNIA 11 OAKLAND DIVISION 12 JEFF JONAH, an individual, on) Case No. 13 behalf of himself, the general public) and those similarly situated,) [San Mateo Superior Court Case No. 14) CIV534157] Plaintiff,) 15) DEFENDANTS KIMBERLY- v.) CLARK GLOBAL SALES, LLC 16) AND KIMBERLY-CLARK KIMBERLY-CLARK) WORLDWIDE, INC.'S NOTICE OF 17 CORPORATION; KIMBERLY-) REMOVAL; DECLARATION OF CLARK WORLDWIDE, INC.;) AMY P. LALLY 18 KIMBERLY-CLARK GLOBAL) SALES LLC; and DOES 1 through) 19 50)) State Action Filed: June 9, 2015 20 Defendants.)) State Action Served: June 12, 2015 21) 22 23 24 25 26 27 28 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S NOTICE OF REMOVAL 1 TO THE CLERK OF THE UNITED STATES DISTRICT COURT, 2 NORTHERN DISTRICT OF CALIFORNIA: 3 Pursuant to 28 U.S.C. §§ 1332, 1441, 1446, and 1453, Defendants Kimberly- 4 Clark Global Sales, LLC, and Kimberly-Clark Worldwide, Inc. (collectively, 5 "Kimberly-Clark") hereby remove to this Court the above-styled action, pending as 6 Case No. CIV534157 in the Superior Court of the State of California for the County 7 of San Mateo (the "State Court Action"). 8 I. INTRODUCTION 9 1. This case is properly removed to this Court pursuant to 28 U.S.C. 10 § 1441(a) and (b) because the State Court Action is pending in the Superior Court of 11 California, County of San Mateo, which is within the Northern District of California; 12 the Court has original jurisdiction over the State Court Action pursuant to 28 U.S.C. 13 § 1332(d); and the procedural requirements for removal are satisfied. Specifically, 14 this Court has jurisdiction pursuant to the Class Action Fairness Act ("CAFA") 15 because there is minimal diversity between the parties, the alleged putative class is 16 "composed of more than 100 persons," and the amount in controversy exceeds the 17 jurisdictional amount of $5,000,000. See 28 U.S.C. §§ 1332(d), 1453. 18 II. BACKGROUND 19 2. On or about June 9, 2015, Plaintiff Jeff Jonah ("Plaintiff") filed the 20 State Court Action against Kimberly-Clark Global Sales, LLC; Kimberly-Clark 21 Corporation; Kimberly-Clark Worldwide, Inc.; and Does 1 through 50 in the 22 Superior Court of California, County of San Mateo.1 23 1 24 Although Kimberly-Clark Corporation is named as a co-defendant in the Jonah Action, Kimberly- Clark Corporation has not been served. Moreover, although Plaintiff has named Kimberly-Clark 25 Worldwide, Inc. as a co-defendant, that entity (and Kimberly-Clark Corporation, for that matter) are neither necessary nor proper parties to this suit. The sole correct party to this litigation is Kimberly- 26 Clark Global Sales, LLC. While CAFA permits any defendant to unilaterally remove the action where, as here, CAFA's requirements are met, see 28 U.S.C. § 1453(b), in an abundance of caution, 27 the two defendants who have been served -- Kimberly-Clark Global Sales, LLC and Kimberly-Clark Worldwide, Inc. -- are removing. 28 1 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S NOTICE OF REMOVAL 1 3. Plaintiff seeks relief on behalf of a statewide class consisting of "[a]ll 2 persons who, between June 8, 2011 and the present, purchased in California any of 3 the following products: Cottonelle® Fresh Care Flushable Wipes & Cleansing 4 Cloths, Scott Naturals® Flushable Most Wipes, Huggies® Pull-Ups® Flushable 5 Moist Wipes, and U by Kotex® Refresh flushable wipes."2 Compl. ¶ 82. 6 4. The Complaint alleges claims against Kimberly-Clark for violations of 7 the California Consumer Legal Remedies Act ("CLRA"), Cal. Civ. Code § 1750, et 8 seq.; the California False Advertising Law, Cal. Bus. & Prof. Code § 17500, et seq.; 9 and the California Unfair Competition Law, Cal. Bus. & Prof. Code § 17200, et seq.; 10 and for fraud and negligent misrepresentation, arising out of the sale of flushable 11 wipes. Compl. ¶¶ 91-138. 12 5. The Complaint seeks restitution, injunctive relief, compensatory 13 damages, punitive damages, and attorneys' fees and costs. Compl. at 34:2-35:3. 14 6. On June 12, 2015, process was served on Kimberly-Clark Global Sales, 15 LLC and Kimberly-Clark Worldwide, Inc. However, as of the date of removal, 16 Kimberly-Clark Corporation has not been served. No defendant has filed an answer 17 or responsive pleading to the Complaint and no further proceedings have taken place 18 in the State Court Action. A case management conference has been set for 19 October 22, 2015. 20 III. JURISDICTION 21 7. Based on the allegations on the face of the Complaint, this Court has 22 original jurisdiction over the State Court Action pursuant to CAFA. See 28 U.S.C. 23 § 1332(d). 24 8. CAFA provides for federal jurisdiction of any "class action" composed 25 of 100 or more putative-class members, where any member of the proposed class is a 26 27 2 The complaint refers to these products collectively as "flushable wipes". 28 2 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S NOTICE OF REMOVAL 1 citizen of a state different from any defendant, and the amount in controversy 2 exceeds $5,000,000 (exclusive of interest and costs). 28 U.S.C. § 1332(d). 3 9. Although Kimberly-Clark denies that it is liable to any individual or that 4 class treatment is appropriate for this case, removal is proper pursuant to 28 U.S.C. 5 §§ 1332(d) and 1453 because the State Court Action is an action between citizens of 6 different states, on behalf of a putative class allegedly "composed of more than 100 7 persons," and involves an amount in controversy exceeding $5,000,000. 8 A. There is Minimal Diversity 9 10. CAFA requires only minimal diversity, namely, that "any member of a 10 class of plaintiffs is a citizen of a State different from any defendant. . . ." 28 U.S.C. 11 § 1332(d)(2)(A). 12 11. Plaintiff alleges that he "is, and at all times alleged in this Class Action 13 Complaint was, an individual and a resident of San Carlos, California." Compl. ¶ 3. 14 As such, Kimberly-Clark is informed and believes that at the time Plaintiff filed the 15 State Court Action, Plaintiff was a citizen of California. 16 12. For diversity purposes, a corporation is deemed to be a citizen of: 17 (1) the state under whose laws it is organized; and (2) the state of its "principal place 18 of business." 28 U.S.C. § 1332(c)(1); see also Davis v. HSBC Bank Nevada, N.A., 19 557 F.3d 1026, 1028 (9th Cir. 2009). Kimberly-Clark Global Sales LLC is a 20 corporation organized under the laws of Delaware. See Compl. ¶ 6; see also 21 Declaration of Troy Youngbauer ("Youngbauer Decl.") ¶ 3. Kimberly-Clark Global 22 Sales LLC has a principal place of business is Irving, Texas. Compl. ¶ 6; see also 23 Youngbauer Decl. ¶ 3. 24 13. The minimal-diversity requirement, therefore, is satisfied because 25 Plaintiff is a citizen of California and Kimberly-Clark Global Sales LLC is a citizen 26 of Delaware and Texas. 27 28 3 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S NOTICE OF REMOVAL 1 B. The Alleged Class Involves At Least 100 Class Members. 2 14. CAFA requires that "the number of members of all proposed plaintiff 3 classes in the aggregate" be at least 100. 28 U.S.C. § 1332(d)(5)(B). 4 15. Plaintiff's Complaint was filed as a state-wide class action, as defined in 5 28 U.S.C. § 1332(d)(1)(B), and alleges a putative class in excess of 100 class 6 members. Compl. ¶ 84 (alleging that plaintiff estimates that the class "is composed 7 of more than 100 persons"). 8 C. The Alleged Amount in Controversy Exceeds $5,000,000 9 16. CAFA requires that the "aggregate[]" "matter in controversy exceed[] 10 the sum or value of $5,000,000, exclusive of interest and costs." 28 U.S.C. 11 § 1332(d)(2) & (6). Removal is proper if it is demonstrated, "by a preponderance of 12 evidence, that the aggregate amount in controversy exceeds" $5,000,000. Rodriguez 13 v. AT&T Mobility Servs. LLC, 728 F.3d 975, 981 (9th Cir. 2013). The amount in 14 controversy is determined by accepting Plaintiff's allegations as true. See, e.g., 15 Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 402 (9th Cir. 1996) ("[T]he 16 amount in controversy is met by the express allegations of the plaintiff's complaint." 17 (quotation omitted)); Cain v. Hartford Life & Accident Ins. Co., 890 F. Supp. 2d 18 1246, 1249 (C.D. Cal. 2012) ("In measuring the amount in controversy, a court must 19 assume that the allegations of the complaint are true and assume that a jury will 20 return a verdict for the plaintiff on all claims made in the complaint."). 21 17. Although Kimberly-Clark denies that Plaintiff is entitled to any of the 22 relief sought in the Complaint, the relief that the Complaint seeks through restitution, 23 injunctive relief, and attorneys' fees exceeds CAFA's $5,000,000 amount-in- 24 controversy requirement. 25 1. Restitution 26 18. Plaintiff seeks to represent "[a]ll persons who, between June 8, 2011 27 and the present, purchased in California any of the following products: Cottonelle® 28 Fresh Care Flushable Wipes & Cleansing Cloths, Scott Naturals® Flushable Most 4 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S NOTICE OF REMOVAL 1 Wipes, Huggies® Pull-Ups® Flushable Moist Wipes, and U by Kotex® Refresh 2 flushable wipes," Compl. ¶ 82, and seeks restitution of "any and all monies acquired 3 by Defendants from Plaintiff, the general public, or those similarly situated by means 4 of [alleged misrepresentations]." Id. ¶ 108; see also ¶ 136. 5 19. Since June 9, 2011, Kimberly-Clark Global Sales LLC's sales in 6 California of one of the four brands of flushable wipes at issue alone exceeds $5 7 million. See Youngbauer Decl. ¶ 4. 8 2. Injunctive Relief 9 20. Plaintiff also seeks injunctive relief. Costs of compliance with an 10 injunction are relevant in ascertaining whether the amount in controversy 11 requirement is satisfied. See 28 U.S.C. 1332(d) (excluding only interest and costs 12 from the aggregated amount in controversy); see also Guglielmino v. McKee Food 13 Corp., 506 F.3d 696, 700 (9th Cir. 2007). Pursuant to the CLRA, Plaintiff 14 individually and on behalf of the purported class seeks an injunction barring any 15 practice set forth in the Complaint and ordering that Kimberly-Clark "correct, repair, 16 replace or otherwise rectify" the alleged practices. Compl. ¶ 98. 17 21. An injunction would impose additional costs on Kimberly-Clark Global 18 Sales LLC to re-design and re-package flushable wipes throughout California and 19 possibly nationwide given Kimberly-Clark Global Sales LLC's distribution model. 20 See Youngbauer Decl. ¶¶ 5-7. 21 22. Additionally, if Kimberly-Clark Global Sales LLC is enjoined from 22 selling flushable wipes as packaged in California, it would incur significant losses 23 including the time during which it would have to design new labels for flushable 24 wipes, print them, and package each product, as well as the loss of customer 25 confidence—both at the retail and consumer level—that might result. Youngbauer 26 Decl. ¶ 8. 27 28 5 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S NOTICE OF REMOVAL 1 3. Attorneys' Fees 2 23. An award of attorneys' fees, if such fees are specifically authorized by 3 statute, may be considered for purposes of calculating the amount in controversy. 4 See Kroske v. US Bank Corp., 432 F.3d 976, 980 (9th Cir. 2005). Here, if Plaintiff 5 and/or the putative class succeed on the CLRA claim, recovery of attorneys' fees 6 may be statutorily authorized. See Cal. Civ. Code § 1780(e). 7 24. Courts in the Ninth Circuit consider a reasonable and fair estimate of 8 attorneys' fees to be twenty-five percent of the total recovery. See, e.g., Powers v. 9 Eichen, 229 F.3d 1249, 1256 (9th Cir. 2000); Lim v. Helio, LLC, No. CV 11-9183 10 PSG, 2012 WL 359304, at *3 (C.D. Cal. Feb. 2, 2012). 11 25. As explained above, the estimated amount in controversy in the instant 12 case (for restitution, injunctive relief and attorneys' fees) exceeds $5 million. This 13 amount satisfies CAFA's $5,000,000 amount-in-controversy requirement based on 14 the allegations of Plaintiff's Complaint. 15 IV. THE PROCEDURAL REQUIREMENTS FOR REMOVAL ARE 16 SATISFIED 17 26. This Court is the proper venue for this action under 28 U.S.C. 18 § 1441(a), as the State Court Action is pending in the County of San Mateo, 19 California, and the United States District Court for the Northern District of 20 California is the "district and division embracing the place where such action is 21 pending." 28 U.S.C. § 1441(a). 22 27. The Complaint was filed on June 9, 2015, and Kimberly-Clark Global 23 Sales, LLC and Kimberly-Clark Worldwide, Inc. were served with the Complaint 24 along with the summons on June 12, 2015. Therefore, this Notice of Removal has 25 been timely filed within thirty days of receipt by Kimberly-Clark of a copy of the 26 summons and Complaint, pursuant to 28 U.S.C. §§ 1446(b) and 1453(b). See also 27 Fed. R. Civ. P. 6(a)(1); Avalos v. K Mart Corp., No. CV 12-05682 MMM, 2012 U.S. 28 Dist. LEXIS 97707, *8 n.4 (C.D. Cal. July 13, 2012) (citing Wells v. Gateways Hosp. 6 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S NOTICE OF REMOVAL 1 & Mental Health Ctr., 76 F.3d 390 (9th Cir. 1996) (unpublished, reported in full- 2 text format at 1996 U.S. App. LEXIS 2287, at *2)). 3 28. Pursuant to 28 U.S.C. § 1446(a), a copy of the Summons and Complaint 4 served upon Kimberly-Clark Global Sales LLC and Kimberly-Clark Worldwide, Inc. 5 are attached as Exhibits A and B, respectively, to the Declaration of Amy P. Lally, 6 and these are the only process, pleadings, and orders served upon Kimberly-Clark to 7 date. 8 29. Pursuant to 28 U.S.C. § 1446(d), Kimberly-Clark will promptly file a 9 removal notice with the Clerk of the Superior Court of the State of California for the 10 County of San Mateo and will serve written notice of same upon counsel of record 11 for Plaintiff. 12 30. Kimberly-Clark reserves the right to amend or supplement this Notice 13 of Removal. 14 31. By filing this Notice of Removal, Kimberly-Clark does not waive, either 15 expressly or implicitly, its rights to assert any defense which it could have asserted in 16 the Superior Court of the State of California for the County of San Mateo. 17 WHEREFORE, Defendants Kimberly-Clark Global Sales LLC and Kimberly- 18 Clark Worldwide, Inc. respectfully request that the Court assume jurisdiction over this 19 action. 20 21 Dated: July 13, 2015 Respectfully submitted, 22 SIDLEY AUSTIN LLP 23 By: /s/ Amy P. Lally 24 Amy P. Lally 25 Attorneys for Defendants 26 Kimberly-Clark Global Sales LLC, and 27 Kimberly-Clark Worldwide, Inc. 28 7 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S NOTICE OF REMOVAL 1 DECLARATION OF AMY P. LALLY 2 I, AMY P. LALLY, declare as follows: 3 1. I am an attorney at law licensed to practice in the State of California and 4 before the United States District Court for the Northern District of California. I am a 5 Partner in the law firm of Sidley Austin LLP and counsel for Defendants Kimberly- 6 Clark Global Sales LLC and Kimberly-Clark Worldwide, Inc. The matters set forth 7 below are within my personal knowledge, and if called upon as a witness I could and 8 would testify competently as follows: 9 2. Attached as Exhibit A is a true and correct copy of the Summons and 10 Complaint in the action styled as Jonah v. Kimberly Clark Corporation, et al., Case 11 No. CIV534157, filed in the Superior Court ofthe State of California, County of San 12 Mateo, which were served via process server on Kimberly-Clark Global Sales LLC. 13 3. Attached as Exhibit B is a true and correct copy of the Summons and 14 Complaint in the action styled as Jonah v. Kimberly Clark Corporation, et al., Case 15 No. CIV534157, filed in the Superior Court ofthe State of California, County of San 16 Mateo, which were served via process server on Kimberly-Clark Worldwide, Inc. 17 I declare under penalty of perjury under the laws of the United States of 18 America that the foregoing is true and correct. 19 Executed this 13th day of July, 2015. 20 21 22 23 24 25 26 27 28 8 DEFENDANTS KIMBERLY-CLARK GLOBAL SALES LLC, AND KIMBERLY-CLARK WORLDWIDE, INC.'S 208460575v.2 NOTICE OF REMOVAL