United States District Court, D. Hawaii
ADON CONSTRUCTION INC. and GREEN VISION LLC, Plaintiffs,
RENESOLA AMERICA INC.; KIVALU RAMANLAL; et al., Defendants.
ORDER GRANTING DEFENDANT KIVALU RAMANLAL'S MOTION
Derrick K. Watson United States District Judge.
Kivalu Ramanlal seeks dismissal of the sole claim asserted
against him by Plaintiffs Adon Construction Inc.
(“Adon”) and Green Vision LLC for “breach
of duty to mitigate damages.” Because the Court
previously ruled that under settled state law, Plaintiffs
cannot state a claim against Ramanlal for “breach of
duty to mitigate damages, ” Ramanlal's Motion To
Dismiss This Action As To Him, With Prejudice is
Prior Rulings In This Matter
filed a Complaint against Ramanlal and Defendant Renesola
America, Inc. (“Renesola”) in state court on
September 15, 2016, Civil No. 16-1-1741-09, alleging
exclusively state-law claims. Plaintiffs contracted to
install photovoltaic (“PV”) panels and systems on
residential and commercial properties in Hawaii. Complaint
¶ 3, attached as Ex. A to Notice of Removal, Dkt. No.
1-1. Renesola manufactures and supplied PV panels to
Plaintiffs for use in their Hawaii installations. Complaint
¶ 5. According to Plaintiffs, certain Renesola PV panels
are defective and have been rejected by their clients.
Complaint ¶ 8.
contracted to install 80 Renesola PV panels on Ramanlal's
residence in 2013 at a cost of $76, 128.00 (“Ramanlal
Project”). On December 3, 2014, Ramanlal sued Adon in
the First Circuit Court of the State of Hawaii, Civil No.
14-1-2463-12, demanding a full refund of the contract price,
in part, due to visible defects to the PV panels
(“Ramanlal State Court Case”). Plaintiffs allege
that although Renesola initially offered to replace certain
panels under warranty, “Renesola has denied fixing the
damaged and/or defective PV Panels/Modules at the Ramanlal
Project and Ramanlal has refused to accept the proposed
resolution to replace 78 out of the 80 Renesola PV
[panels].” Complaint ¶ 38. According to
Plaintiffs, they attempted to work with Renesola to resolve
the defective PV panel issues throughout 2015, but Renesola
refused to remedy the defects, Complaint ¶¶ 41-50,
while Plaintiffs continue to incur damages by having to
defend the Ramanlal State Court Case. Complaint ¶ 39-40.
allege multiple state-law claims against Renesola, but assert
a single cause of action against Ramanlal for “breach
of duty to mitigate damages.” Complaint ¶¶
176-184. That claim alleges that Ramanlal “failed to
exercise reasonable diligence to mitigate his damages”
when he refused to allow representatives from Renesola to
access his property and refused to accept the replacement of
defective PV panels as a remedy in the Ramanlal State Court
Case.Complaint ¶ 180.
removed the case on October 20, 2016, without the consent of
Ramanlal, on the basis of diversity jurisdiction.
See Notice of Removal ¶ 25. On December 2,
2016, Plaintiffs filed a Motion to Remand, asserting that the
Court lacks diversity jurisdiction because Plaintiffs and
Ramanlal are citizens of the same state. Dkt. No. 16. In a
January 6, 2017 Findings and Recommendation to Deny the
Motion to Remand (“F&R”), the Magistrate
Judge found that Ramanlal was fraudulently joined because
Plaintiffs failed to state a valid claim that was
“obvious under settled Hawaii law, ” and hence,
his presence as a Hawaii resident may be ignored for purposes
of establishing diversity jurisdiction. See F&R
at 2-4, 7-9, Dkt. No. 27.
March 6, 2017 Order adopting the F&R, the Court concluded
as follows with respect to the validity of Plaintiffs'
lone claim against Ramanlal:
Plaintiffs' single cause of action against Ramanlal for
“breach of duty to mitigate damages” fails to
state a stand-alone claim for relief. Moreover, this failure
is obvious according to the settled rules of Hawaii. See
Morris, 236 F.3d at 1067, and McCabe, 811 F.2d
at 1339. “Breach of duty to mitigate damages, ”
or “failure to mitigate damages, ” is a
well-established affirmative defense, not a viable
independent cause of action in the manner pled by Plaintiffs
here. See, e.g., Tabieros v. Clark Equip. Co., 85
Haw. 336, 373, 944 P.2d 1279, 1316 (1997) (“[I]n
contract or in tort, the plaintiff has a duty to make every
reasonable effort to mitigate his [or her] damages. The
burden, however, is upon the defendant to prove that
mitigation is possible, and that the injured party has failed
to take reasonable steps to mitigate his [or her]
damages.”) (quoting Malani v. Clapp, 56 Haw.
507, 517, 542 P.2d 1265, 1271 (1975) (alterations in
Tabieros)); Hawaii Broad. Co. v. Hawaii Radio,
Inc., 82 Haw. 106, 112-13, 919 P.2d 1018, 1024-25 (Ct.
App. 1996) (Discussing requirement that affirmative defense
of “failure to mitigate damages” be pled in
answer pursuant to Rule 8 where “[t]he primary purpose
of requiring affirmative defenses to be pleaded is to give
notice to the parties of such defenses.”).
3/6/17 Order at 14-15, Dkt. No. 31. Following the Court's
March 6, 2017 Order, Plaintiffs filed their opposition to the
instant Motion on March 17, 2017, and continue to advance the
viability of their claim for breach of duty to mitigate
damages, notwithstanding the Court's ruling to the
contrary. See Pls.' Mem. in Opp'n, Dkt. No
Ramanlal's Motion Is Granted
seeks dismissal with prejudice of the claim asserted against
him. Federal Rule of Civil Procedure 12(b)(6) authorizes the
Court to dismiss a complaint that fails “to state a
claim upon which relief can be granted.” The Court may
dismiss a complaint either because it lacks a cognizable
legal theory or because it lacks sufficient factual
allegations to support a cognizable legal theory.
Balistreri v. Pacifica Police Dep't., 901 F.2d
696, 699 (9th Cir. 1988). As clearly stated in the