1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 SAN JOSE DIVISION 7 8 PACIFIC VALLEY BANK, Case No. 5:22-cv-03500-EJD

9 Plaintiff, ORDER GRANTING MOTION TO

REMAND; DENYING MOTION FOR

10 v. SANCTIONS

11 JOSEPH S. SERVI, et al., Re: Dkt. Nos. 12, 13 Defendants. 12

13 Plaintiff Pacific Valley Bank (“PVB”) initiated this suit in the Superior Court of 14 California, County of Monterey, asserting claims against Defendants Joseph S. Servi (“Servi”) and 15 Pinnacle Bank for misappropriation of trade secrets, breach of contract, intentional interference 16 with contractual relations, intentional interference with prospective economic relations, violation 17 of California Business & Professions Code section 17200, and trade libel. Dkt. No. 1-1. Servi 18 removed the action pursuant to 28 U.S.C. §§ 1331 and 1441(a). PVB moves to remand the action 19 and for sanctions. Dkt. Nos. 12, 13. 20 Federal question jurisdiction requires that a federal issue appear on the face of the well- 21 pleaded complaint. Taylor v. Anderson, 234 U.S. 74, 75–76, 34 S.Ct. 724, 58 L.Ed. 1218 (1914); 22 Holmes Group, Inc. v. Vornado Air Circulation Systems, Inc., 535 U.S. 826, 830, 122 S.Ct. 1889, 23 153 L.Ed.2d 13 (2002). The removing party bears the burden of showing that removal is proper. 24 Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). 25 Here, PVB’s complaint pleads only state law causes of action; there are no references to 26 any federal statute. The only basis Servi advances for federal question jurisdiction is that PVB 27 asserts a claim under the Defend Trade Secrets Act, 18 U.S.C. § 1836. This is false; the complaint 1 does not refer to any federal statute.! 2 Servi next contends that PVB “artfully pleaded” to avoid federal jurisdiction. Under the 3 “artful pleading” doctrine, a court may recharacterize a plaintiff’s claims as federal if “the 4 || particular conduct complained of [is] governed exclusively by federal law.” Hunter v. United Van 5 || Lines, 746 F.2d 635, 640 (9th Cir. 1984), cert. denied, 474 U.S. 863, 106 S.Ct. 180, 88 L.Ed.2d 6 150 (1985). Here, the particular conduct complained of, misappropriation of trade secrets, is not 7 governed exclusively by federal law. 8 Lastly, Servi contends that PVB waived its right to seek remand by filing an amended 9 complaint. This is incorrect. It is well established that parties cannot waive subject matter 10 || jurisdiction. Augustine v. U.S., 704 F.2d 1074, 1077 (9th Cir. 1983). 11 Accordingly, PVB’s motion to remand is GRANTED. The motion for sanctions is 12 || DENIED. 13 IT IS SO ORDERED. 14 Dated: September 30, 2022

EDWARD J. DAVILA

17 United States District Judge 18 19 20 21 22 23 24 25 26 27 ' Servi suggests that removal is proper because PVB’s pre-suit demand letter referred to the Defend Trade Secrets Act. The argument is frivolous. 28 || Case No.: 5:22-cv-03500-EJD

ORDER GRANTING MOTION TO REMAND; DENYING MOTION FOR SANCTIONS