Tuesday, July 14, 2026
Page 3
Ninth Circuit:
Judge Improperly Bounced Cases Back to Superior Courts
Panel Vacates Remand Orders, Says Defendant’s Declaration as to Amount in Controversy Can’t Be Disregarded
By a MetNews Staff Writer
The Ninth U.S. Circuit Court of Appeals has held that a judge erred in shunting two cases, each brought under California’s “lemon law” and its Unfair Competition Law, back to the respective superior courts where they were initially filed, declaring that a sua sponte remand is improper based merely on a judicial hunch that the amount in controversy does not meet the jurisdictional minimum of $75,000.
The allegation by defendant Nissan North America. Inc. in each of the cases as to the amount in controversy, contained in its notice of removal to federal court, should have been credited, absent opposition or a reason for questioning it, a three-judge panel said in memorandum opinions.
The panel—comprised of Circuit Judges Roopali H. Desai, Ronald M. Gould, and Salvador Mendoza Jr.—did not weigh in on the suggestion by District Court Judge David O. Carter that Congress consider boosting the threshold amount in diversity cases, set 30 years ago.
Carter on April 11, 2025, ordered an action brought by Lidia C. Navaperez and Malaquias Valdivia returned to the Orange Superior Court, and on April 21 ruled that a lawsuit by Maria Amezcua with nearly duplicate allegations be bounced back to the San Bernardino Superior Court.
Near Mirror Images
The two appeals of Carter’s orders were dealt with in separate opinions, though the language varies only as to individual facts—including the price of the vehicle in question being set in Navaperez’s and Valdivia’s complaint at $36,344.48 while Amezcua pled that her car cost $43,596.64.
In each case, Carter said in ordering a remand:
“Here, Plaintiffs do not expressly allege an amount in controversy over $75,000….Accordingly, Defendant must show by a preponderance of the evidence that the jurisdictional minimum is satisfied.”
He went on to say:
“While Plaintiffs might have suffered more than $75,000 in damages as a result of Defendant’s conduct and product, the record currently before the Court does not support that conclusion.
“Further, the Court will not include speculative civil penalties or attorneys’ fees to meet the amount in controversy requirement.”
Reversal Explained
In vacating Carter’s orders and remanding for further proceedings, the panel said:
“A defendant’s notice of removal to federal court does not need to ‘prove’ subject matter jurisdiction.”
A plausible allegation of the amount at stake suffices, the judges set forth, absent a challenge by the plaintiff or a reason for the judge to distrust the assertion.
“If the amount in controversy is contested or questioned, the district court must provide ‘a fair opportunity’ for the defendant to submit evidence to prove, by a preponderance of the evidence, that the amount in controversy requirement is satisfied,” they wrote.
“Because plaintiffs’ claimed civil penalties and attorneys’ fees were ‘at stake in the underlying litigation’ the district court erred by excluding them from the amount in controversy calculation,” the panel added.
While Carter said it was “speculative” that such awards would be made, the judges said he should have afforded Nissan a chance to make a showing to the contrary.
The cases are Navaperez v. Nissan North America, Inc., 25-3016, and Amezcua v. Nissan North America, Inc., 25-3250.
Carter’s Commentary
In his remand orders, Carter commented:
“The Court’s decision not to include speculative awards in the amount in controversy is reinforced by the fact that Congress has not raised the amount in controversy since 1996—nearly three decades ago….Since then, the inflation rate is nearly 100% (i.e., prices have almost doubled). Thus, adjusted for inflation, the amount in controversy should be around $175,000. Stated conversely, a case worth $75.000 in 1996 is worth only $37,500 in today’s dollars.”
He continued:
“Because inflation has plainly decreased the ‘real’ value of the amount in controversy, more and more cases are able to meet the jurisdictional threshold and can be brought in federal court. As federal diversity jurisdiction expands, state court jurisdiction to decide purely state law issues and develop state law correspondingly decreases. Thus, the federal jurisdictional creep is incompatible with the most basic principles of federalism.
“Federalism is not the only loser in Congress’s failure to increase the amount in controversy. When a case is improperly removed, as happened here, ultimate resolution is delayed. Moreover, if a court does not immediately remand a case sua sponte, a plaintiff may move to remand. Because cases subject to motion to remand are typically small dollar cases, this increased motion work can quickly cause attorneys’ fees to outrun any potential recovery and places an immense burden on a plaintiff s lawyer working on contingency. In this respect, the current low jurisdictional threshold reduces access to justice. Therefore, the Court respectfully encourages Congress to reconsider the amount in controversy minimum.”
Carter remarked in a footnote:
“For reference, in 1996, the minimum wage was $4.75 per hour, and only 16% of Americans had cell phones. Indeed, the current amount-in-controversy is older than both of my law clerks.”
Copyright 2026, Metropolitan News Company