Unreported / Non-Citable
Background
Ricardo Cardona filed a complaint in Los Angeles Superior Court on June 15, 2026, against Ford Motor Company asserting four claims under the Song-Beverly Consumer Warranty Act: breach of express warranties, breach of implied warranties, failure to promptly repurchase the product, and failure to commence repairs within a reasonable time and to complete them within 30 days. The claims arose from his August 2023 purchase of a 2023 Ford Bronco that allegedly was delivered with serious defects and nonconformities. After several repair attempts at an authorized facility, Ford could not fully repair the vehicle, and it had neither replaced the vehicle nor made restitution.
Ford removed the action to federal court on July 15, 2026, asserting diversity of citizenship. On July 29, 2026, the court issued an order to show cause requiring Ford to show that jurisdictional requirements were satisfied, and it discharged that order on August 4, 2026, after receiving Ford's reply. Cardona then filed a motion to remand the case to the Los Angeles Superior Court, challenging the amount in controversy. The court denied the motion.
The Court’s Holding
Ford first argued that Cardona's motion was untimely under the 30-day limitation on motions to remand in 28 U.S.C. § 1447(c), contending that once the court discharged its order to show cause, the motion could only be a procedural challenge to Ford's evidence. The court rejected that argument. A challenge to the amount in controversy is a substantive challenge to subject matter jurisdiction, not a defect 'other than lack of subject matter jurisdiction,' so it is not time-barred. The court retains discretion to review jurisdiction throughout the case until final judgment and may reconsider its interlocutory orders.
On the merits, the court explained that the amount in controversy is an estimate of the total amount in dispute, not a prediction of liability. Under the Song-Beverly Act, actual damages are restitution equal to the actual price paid or payable, less an offset for the buyer's use before the first repair attempt, calculated as miles driven before that attempt divided by 120,000, times the cash purchase price. The retail installment contract showed a cash purchase price of $70,030; Cardona received the vehicle with 48 miles and returned it with 10,672 miles. The resulting offset was $6,199.99, leaving actual damages of $71,409.69.
Civil penalties, costs, and attorneys' fees are generally too speculative to count significantly toward the amount in controversy, and Song-Beverly civil penalties are treated akin to punitive damages. But here actual damages already totaled $71,409.69 — about $3,600 short of the $75,000 threshold — and it was undisputed that Cardona's counsel had already spent time on the case. The court therefore found that diversity jurisdiction had been established by a preponderance of the evidence and denied the motion to remand.
Key Takeaways
- A challenge to the amount in controversy is a substantive challenge to subject matter jurisdiction, not a procedural defect, and is therefore not subject to the 30-day time limit for remand motions under 28 U.S.C. § 1447(c).
- Federal courts may review subject matter jurisdiction at any point before final judgment and may reconsider interlocutory orders, including a discharged order to show cause on jurisdiction.
- Under the Song-Beverly Act, amount-in-controversy damages equal the full purchase price less a mileage-based offset: miles driven before the first repair attempt divided by 120,000, multiplied by the cash purchase price.
- Civil penalties and attorneys' fees are usually too speculative to weigh heavily, but where actual damages fall just short of $75,000 and counsel has undisputedly spent time on the case, diversity jurisdiction may still be established by a preponderance of the evidence.
Why It Matters
The order draws a clear line between procedural and substantive challenges to removal: only defects other than lack of subject matter jurisdiction are confined to the 30-day window, so amount-in-controversy challenges remain available throughout the litigation, even after the court has already found jurisdiction satisfied. That distinction matters in removed consumer-warranty cases, where plaintiffs often contest jurisdiction long after removal.
The decision also supplies a concrete method for computing the amount in controversy in Song-Beverly Act cases — full purchase price minus a mileage offset — and shows that jurisdiction can rest on actual damages plus undisputed attorney time even when damages alone fall below $75,000.