Case 3:17-cv-07088-AGT Document 199 Filed 06/19/20 Page 1 of 3
`
`
`
`
`
`
`
`
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`DODOCASE VR, INC., et al.,
`
`Plaintiffs,
`
`v.
`
`MERCHSOURCE, LLC, et al.,
`
`Defendants.
`
`Case No. 17-cv-07088-AGT
`
`ORDER DISMISSING CASE FOR
`LACK OF SUBJECT-MATTER
`JURISDICTION
`
`
`
`
`
`
`
`In the original and first two amended complaints in this case, the plaintiffs raised patent
`
`claims and a breach-of-contract claim. In the operative, third amended complaint they voluntarily
`
`withdrew their patent claims, leaving only their contract claim outstanding. Concerned that this
`
`latest amendment eliminated federal subject-matter jurisdiction, the Court ordered the parties to
`
`show cause. See ECF No. 196. Having considered their briefs in response to that order, the Court
`
`concludes that indeed it no longer has jurisdiction.
`
`* * *
`
`Before plaintiffs filed their third amended complaint, the Court had original jurisdiction
`
`over their patent claims, see 28 U.S.C. § 1338(a), and supplemental jurisdiction over their state-
`
`law contract claim, see id. § 1367(a). The question raised in the order to show cause was whether
`
`the Court could still exercise supplemental jurisdiction over their contract claim even though they
`
`voluntarily withdrew their patent claims in their third amended complaint.
`
`Two circuit courts have considered this question and have both concluded that, no, a
`
`federal court cannot exercise supplemental jurisdiction over a state-law claim in an amended
`
`complaint if in that same amended complaint the plaintiff withdrew the federal claims that had
`
`supported original jurisdiction. See Pintando v. Miami-Dade Hous. Agency, 501 F.3d 1241, 1242
`
`(11th Cir. 2007) (after plaintiff amended his complaint to drop his federal claim, “there no longer
`
`was a federal law question upon which supplemental jurisdiction could rest”); Wellness Cmty.-
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:17-cv-07088-AGT Document 199 Filed 06/19/20 Page 2 of 3
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Nat’l v. Wellness House, 70 F.3d 46, 50 (7th Cir. 1995) (because plaintiff chose to amend its
`
`complaint to drop its federal claim, “there was no federal claim to which the[] state claims [that
`
`remained] could be ‘supplemental’”).
`
`Plaintiffs note that the Ninth Circuit hasn’t directly considered the same question, but that
`
`fact doesn’t give the Court pause. This is because Pintando and Wellness Community logically
`
`follow from two rules that the Court is bound to follow. First, “when a plaintiff files a complaint
`
`in federal court and then voluntarily amends the complaint, courts look to the amended complaint
`
`to determine jurisdiction.” Rockwell Int’l Corp. v. United States, 549 U.S. 457, 473–74 (2007).
`
`Second, “supplemental jurisdiction may only be invoked when the district court has a hook of
`
`original jurisdiction on which to hang it.” Herman Family Revocable Tr. v. Teddy Bear, 254 F.3d
`
`802, 805 (9th Cir. 2001). Together, these rules mean that if a voluntarily amended complaint
`
`doesn’t include a claim that supports original jurisdiction (i.e., a federal claim or a claim based on
`
`diversity jurisdiction), then supplemental jurisdiction can’t be invoked.1
`
`Plaintiffs highlight an exception to the first of these rules, which they suggest is applicable.
`
`The exception is that even after amendment, allegations or claims in a prior complaint may still be
`
`considered if they are “adopted by reference” in the amended complaint. Fed. R. Civ. P. 10(c); see
`
`also Boelens v. Redman Homes, Inc., 759 F.2d 504, 508 (5th Cir. 1985) (cited in Rockwell and in
`
`Pintando) (“[A]n amended complaint ordinarily supersedes the original and renders it of no legal
`
`effect, unless the amended complaint specifically refers to or adopts the earlier pleading.”).
`
`Plaintiffs’ third amended complaint does reference the prior complaints, noting that the
`
`prior complaints raised patent claims over which the Court had original jurisdiction. See ECF No.
`
`153, TAC ¶ 22. But the third amended complaint goes on to explain that the purpose of the
`
`amendment was to “formally remove” the patent claims from the case so to avoid a protracted
`
`dispute over patent validity. Id. ¶ 23. Given this explanation, plaintiffs cannot credibly maintain
`
`that the third amended complaint incorporated the earlier complaints’ federal claims. The third
`
`1 As noted in Rockwell, different rules govern when a defendant removes a case to federal court.
`See 549 U.S. at 474 n.6. Those rules don’t govern here because there was no removal; the
`plaintiffs filed this case in federal court.
`
`2
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:17-cv-07088-AGT Document 199 Filed 06/19/20 Page 3 of 3
`
`amended complaint explicitly dropped the federal claims, and plaintiffs “must be held to the
`
`jurisdictional consequences of a voluntary abandonment of claims that would otherwise provide
`
`federal jurisdiction.” Boelens, 759 F.2d at 508.
`
`The Court cannot exercise supplemental jurisdiction over the state-law claim remaining in
`
`the third amended complaint. There simply is no “hook of original jurisdiction on which to hang
`
`it.” Herman, 254 F.3d at 805.
`
`* * *
`
`Defendant ThreeSixty Brands Group LLC has asked the Court to dismiss the contract
`
`claim against it with prejudice—asserting that the claim is baseless. To determine if the claim is
`
`baseless, the Court would need to consider its merits; but the Court can’t do so because it lacks
`
`subject-matter jurisdiction. See Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 94 (1998)
`
`(“Without jurisdiction the court cannot proceed at all in any cause.”) (citation omitted).
`
`A different conclusion doesn’t follow from Tijerino v. Stetson Desert Project, LLC, 934
`
`F.3d 968 (9th Cir. 2019), as defendants suggest. That decision explained that jurisdiction and the
`
`merits may be intertwined when the asserted basis for jurisdiction is 28 U.S.C. § 1331. This is
`
`because federal claims that are “patently without merit” don’t support federal-question jurisdiction
`
`under § 1331. Id. at 975. Here, the asserted basis for jurisdiction is § 1367 not § 1331, and no
`
`analysis of the merits is necessary to determine that the Court lacks jurisdiction under § 1367.
`
`Dismissal for lack of subject-matter jurisdiction is generally “without prejudice.” Missouri
`
`ex rel. Koster v. Harris, 847 F.3d 646, 656 (9th Cir. 2017). The Court declines to deviate from
`
`that standard here. All claims in this action are dismissed without prejudice and all pending
`
`motions are vacated.2
`
`IT IS SO ORDERED.
`June 19, 2020
`Dated:
`
`_____________________________
`ALEX G. TSE
`United States Magistrate Judge
`
`2 As defendants note, before plaintiffs filed their third amended complaint the Court resolved
`certain legal issues. See ECF No. 145 (order granting defendants’ motion for a declaration of
`rights). The Court had subject-matter jurisdiction at the time, so those legal determinations are not
`void.
`
`3
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`