The opinion of the court was delivered by: WILLIAMS
According to Nicholson's complaint, Nicholson resides at 7045 South Washtenaw in Chicago, Illinois; the Credit Union has its principal place of business at Camp Pendleton, California. (Complaint PP 3, 4.) In October of 1994, Nicholson purchased a car for slightly less than $ 10,000. (Id. P 5 & Ex. A.) He put roughly $ 500 down and financed the balance with a loan from the Credit Union, which involved a total finance charge of about $ 2,600. (Id.) In October of 1996, the Credit Union had the car repossessed from Nicholson's residence in Chicago. (Id. P 6.) At that time, the car was worth approximately $ 6,000. (Id. P 12.) In November of 1996, the Credit Union sent Nicholson a Notice of Sale, which stated that the Credit Union would sell the car. The Notice of Sale did not state when the sale would occur. (Id. PP 7, 14 & Ex. B.) Nicholson demanded that the Credit Union return the car to him, but the car was not returned. (Id. PP 10.)
In Count I of his complaint, Nicholson alleges that the Credit Union violated the Illinois Uniform Commercial Code ("the UCC"). (Id. PP 14.) Specifically, Nicholson alleges that the notice of sale he received from the Credit Union violated the UCC by failing to specify when his vehicle would be sold. (Id. PP 7, 8, 9, 14, 15 & Ex. B.) Nicholson brings Count I on behalf of the class of all persons who received such defective notices of sale from the Credit Union. (Id. P 16.) In Count II, Nicholson alleges that the Credit Union violated Section 17200 of the California Business and Professions Code ("the California Code"), which makes it unlawful for a business to engage in any "unfair or fraudulent business act or practice." (Id. P 24, 27.) Nicholson brings Count II as a "private attorney general" enforcing the California Code. (Id. PP 23, 25.) In Count III, Nicholson alleges that the Credit Union committed the tort of conversion, by wrongfully repossessing his car. (Id. PP 30, 31.)
Nicholson claims that this court has diversity jurisdiction because he and the Credit Union are citizens of different states, and "the amount in controversy for Count II is over $ 50,000." (Id. P 2; emphasis added.) He states that venue is proper in the Northern District of Illinois because his "claim arose here." (Id.)
A party filing a complaint in federal court has the burden of establishing federal jurisdiction over the subject matter of the suit. The Wellness Community-Nat'l v. Wellness House, 70 F.3d 46, 49 (7th Cir. 1995) (citation omitted). "The first thing a federal judge should do when a complaint is filed is check to see that federal jurisdiction is properly alleged." Wisconsin Knife Works v. National Metal Crafters, 781 F.2d 1280, 1282 (7th Cir. 1986). Generally speaking, a court should not dismiss a complaint for lack of federal jurisdiction without notice and a hearing. Shockley v. Jones, 823 F.2d 1068, 1073 (7th Cir 1987). However, the court may dismiss a complaint sua sponte if the court lacks jurisdiction over the subject matter and "the jurisdictional defect is clearly incurable." Id. ; see, e.g., Controlled Env't Sys. v. Sun Process Co., 936 F. Supp. 520 (N.D. Ill. 1996) (dismissing complaint sua sponte for lack of subject-matter jurisdiction; no diversity of citizenship); BCGS, L.L.C. v. Fisher, 1996 U.S. Dist. LEXIS 10203, No. 96 C 4314, 1996 WL 417585 (N.D. Ill. July 22, 1996) (same; amount in controversy insufficient); Janton v. MWRD of GC, 1996 U.S. Dist. LEXIS 553, No. 96 C 287, 1996 WL 22957 (N.D. Ill. Jan. 22, 1996) (same; no federal question).
Plaintiff Alphonso Nicholson alleges that the court has diversity jurisdiction because he and the Credit Union are citizens of different states and the amount in controversy for count II of his complaint exceeds $ 50,000. (Complaint P 2.) A federal district court has diversity jurisdiction over an action between citizens of different states where the amount in controversy exceeds $ 50,000, "exclusive of interest and costs." 28 U.S.C. § 1332(a). As a general rule, "the amount in controversy claimed by a plaintiff in good faith will be determinative on the issue of jurisdictional amount, unless it appears to a legal certainty that the claim is for less than that required by the rule." NLFC, Inc. v. Devcom Mid-Am., Inc., 45 F.3d 231, 237 (7th Cir.) (citations omitted), cert. denied, 132 L. Ed. 2d 257, 115 S. Ct. 2249 (1995).
In this case, careful analysis of Nicholson's complaint reveals to a legal certainty that Nicholson's claim is for less than $ 50,000, and this jurisdictional defect is clearly incurable.
COUNT I: THE UNIFORM COMMERCIAL CODE
As noted above, Nicholson alleges in Count I that the Credit Union violated the Illinois Uniform Commercial Code ("the UCC"). (Complaint P 14.) According to Nicholson, this violation makes the Credit Union liable for statutory damages "equal to the finance charge plus 10% of the cash price" of the car. (Id. P 15.) The total finance charge was $ 2,617.28. (Id. P 5.) The purchase price was $ 9,848.16 (id.), and ten percent of that amount is $ 984.82. Adding together the finance charge ($ 2,617.28) and ten percent of the purchase price ($ 984.28) produces a grand total of $ 3,602.10. This sum clearly falls short of the $ 50,000 amount required to invoke the diversity jurisdiction of this court.
It makes no difference that Nicholson brings Count I on behalf of the class of all persons who received defective notices of sale, since "multiple persons' claims cannot be combined to reach the minimum amount in controversy." Stromberg Metal Works, Inc. v. Press Mechanical, Inc., 77 F.3d 928, 931 (7th Cir. 1996) (citation omitted) (citing Snyder v. Harris, 394 U.S. 332, 22 L. Ed. 2d 319, 89 S. Ct. 1053 (1969)); Anthony v. Security Pac. Fin. Services, Inc., 75 F.3d 311, 315-16 (7th Cir. 1996).
COUNT II: THE CALIFORNIA BUSINESS AND PROFESSIONS CODE
Perhaps recognizing that the allegations in Count I fail to satisfy the amount in controversy needed to invoke diversity jurisdiction, Nicholson asserts that "the amount in controversy for Count II is over $ 50,000." (Id. P 2.) In Count II, Nicholson alleges that the Credit Union violated Section 17200 of the California Business and Professions Code ("the California Code"), which makes it unlawful for a business to engage in any "unfair or fraudulent business act or practice." (Id. PP 24, 27.) Nicholson brings Count II as a "private attorney general" enforcing the California Code. (Id. PP 23, 25.) By way of relief he seeks restitution, an injunction, costs, and fees. (Id. P 28.)
Unfortunately for Nicholson, the court cannot enforce the California Code. In diversity cases, whether the court applies the substantive law of California, Illinois, or some other state depends on the choice-of-law rules employed by Illinois courts. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 85 L. Ed. 1477, 61 S. Ct. 1020 (1941); Hystro Products, Inc. v. MNP Corp., 18 F.3d 1384, 1387 (7th Cir 1994).
Under Illinois choice-of-law rules, this court will apply Illinois substantive law unless a conflict of law exists and makes a difference in the outcome of the litigation. International Adm'rs, Inc. v. Life Ins. Co. of N. Am., 753 F.2d 1373, 1376 n.4 (7th Cir. 1985); Zurich Ins. ...