ACKER, District Judge.
Before the court is the motion of Katie Lowery and her 418 fellow plaintiffs ("plaintiffs") to remand their above-entitled conjoined action to the Circuit Court of Jefferson County, Alabama, from which it was removed by one defendant, Alabama Power Company ("Alabama Power"), as a purported "mass action" under the Class Action Fairness Act of 2005 ("CAFA"), 28 U.S.C. §§ 1453 and 1332(d). Also before the court is plaintiffs' motion for reconsideration of the court's order of August 16, 2006, requiring them to state their opinions of the fair values of their respective 419 individual claims and whether or not an aggregation of their claims can reasonably be expected to reach the $5,000,000 in controversy necessary for a CAFA removal. For the reasons that follow, the court will grant both the motion for reconsideration and the motion to remand.
Plaintiffs own and occupy numerous parcels of real property situated in Jefferson County, Alabama. On January 24, 2003,
On October 31, 2005, after the case had been transferred from the Bessemer Division to the Birmingham Division, plaintiffs filed an amended and recast complaint, in which 533 individuals were named as plaintiffs and an additional defendant was named, and the preposterous demand for $1,250,000 for each plaintiff was eliminated and replaced with the following enigma:
There was no request, express or implied, for status as a class action in the original or any subsequent amended complaint. The only excuse offered for conglomerating the separate, individual complaints into one suit was that the claims shared common questions of fact and law. On March 16, 2006, plaintiffs filed a second amended and recast complaint, which named 417 plaintiffs and in which the indeterminate demand for judgment and damages was not changed.
On June 20, 2006, plaintiffs filed a third amended and recast complaint, naming 419 plaintiffs and adding as defendants, Alabama Power and Filler Products Company, Inc. ("Filler Products"). No new theories of liability or new acts of tortious conduct were added, and plaintiffs' demand for an unspecified amount in damages was identical to that contained in their first and second amended and recast complaints. On July 17, 2006, Alabama Power removed the case to this court. In its supplemental notice of removal it invoked 28 U.S.C. § 1446 and the removal provisions of CAFA, 28 U.S.C. §§ 1453 and 1332(d), asserting that the action constitutes a "mass action", which, under 28 U.S.C. § 1332(d)(11)(B)(i), is removable. Paragraph 3 of the supplement to the notice of removal began with this sentence: "Plaintiffs did not specify their damages in the complaint". On August 3, 2006, plaintiffs filed the motion to remand now under consideration. Although plaintiffs initially withdrew their motion to remand, they thereafter asked that it be reinstated, and the court reinstated it.
On August 11, 2006, defendants, Filler Products, Hanna Steel Corporation, United States Steel Corporation, Butler Manufacturing Company, Honeywell International, Inc., Fritz Enterprises, Inc., CertainTeed Corporation, Vulcan Materials Company, Baily-PVS Oxides, LLC, and W.J. Bullock Inc., purported to join Alabama Power's notice of removal, although
CAFA expressly provides that "[t]he amendment made by this Act shall apply to any civil action
Although plaintiffs filed their original complaint before CAFA's enactment, the amendment that added Alabama Power and Filler Products, and that precipitated this removal, came after CAFA's effective date. This procedural fact creates two potentially dispositive removability questions: (1) did the filing of the third amended complaint "commence" a new suit for purposes of CAFA; and (2) if so, did the new suit, by retroactive effect, "commence" as to all defendants, or only as to Alabama Power and Filler Products. Filler Products did not join the removal until more than thirty days after service of the third amended complaint, as required by 28 U.S.C. § 1446(b), and for aught appearing, it never filed a copy of a removal notice with the clerk of the state court as required by 28 U.S.C. § 1446(d). Therefore, the purported joinder by Filler Products in the removal by Alabama Power presents a timeliness issue not shared by Alabama Power or any of the original defendants.
After the court heard oral argument on plaintiffs' motion to remand, the Eleventh Circuit followed the Fifth Circuit's decision in Braud v. Transport Service Co. of Illinois, 445 F.3d 801, 803 (5th Cir.2006), and held that state law determines when an action is "commenced" for the purposes of CAFA. Tmesys, Inc. v. Eufaula Drugs, Inc., 462 F.3d 1317, 1319 (11th Cir.2006). In Braud, the Fifth Circuit had earlier explained that the date upon which an action is "commenced" in a state court is ascertained from that state's rules of procedure. 445 F.3d at 803. Accordingly, this court must look to the Alabama Rules of Civil Procedure to find out when this action was "commenced." Alabama's rules provide that "[a] civil action is commenced by filing a complaint with the court." Ala. R. Civ. P. 3(a). The fact, then, is that unless there is a way for defendants to escape the clutches of this procedural rule, this action was "commenced" on January 24, 2003, when the original complaint was filed.
As the Braud court recognized, a distinct issue appears when a complaint is amended to add a defendant. Following the Seventh Circuit's dicta from Schillinger v. Union Pac. R.R., 425 F.3d 330 (7th Cir.2005), the Fifth Circuit in Braud held that
All defendants strenuously argue that a CAFA removal by a single defendant added after CAFA's enactment operates to effect the removal of the entire action, including all of the parties and all of the claims, and not just the claims asserted against the defendant or defendants added after CAFA's effective date. Defendants rely on (1) the statutory language of CAFA, (2) Congressional intent, and (3) the Fifth Circuit's decision in Braud. The recent case of Moniz v. Bayer A.G., 447 F.Supp.2d 31 (D.Mass.2006), was not urged upon the court, that case having only come up on the Westlaw screen after this removal, but for the reasons that follow, the court remains unpersuaded, either by defendants' arguments, or by Moniz and the authorities it cites.
Defendants first contend that the statutory language supports their belief that a single, post-CAFA defendant can remove the
Whether or not this action is, in fact and law, a "mass action" according to CAFA's definition of that term is not clear. See Abrego Abrego v. The Dow Chemical Co., 443 F.2d 676, 682 (9th Cir.2006) (discussing the confusion around the definition of "mass action", and noting that meshing existing jurisdictional and removal statutes with CAFA "mass action" provisions is "far from straightforward"). Regardless of how this Gordian knot will ultimately be untied, the court rejects defendants' argument, because adopting it would render § 1332 internally inconsistent. In particular, § 1332(d)(11)(B)(i) provides that "[a] s used in subsection (A), the term `mass action' means any civil action . . . in which monetary relief claims of 100 or more persons are proposed to be tried jointly on the ground that the plaintiffs' claims involve common questions of law or fact,
Not taking "no" for an answer, defendants next argue that in CAFA Congress intended to expand federal jurisdiction, and that the removal provisions as a matter of this new public policy are to be liberally construed in favor of removal. Defendants rely on the following language from a Senate Judiciary Committee Report: "[b]y this provision, it is the Committee's intent to overrule case law developed by the federal courts requiring the consent of all parties, to the extent that such precedents might be applied to class actions subject to the expanded jurisdictional removal provisions. . . ." Judiciary Committee Report on Class Action Fairness Act, S.REP. NO. 109-14 (1st Sess. 2005). This argument falls short for several reasons. First, the provision to which the Committee language refers is subsection 1453(b), and not subsection 1332(d), the subsection that defines "mass action," as distinct from "class action," the latter of which this case admittedly is not. While a consideration of legislative history is appropriate in instances where there is ambiguity in the statutory language, and while the word "action", as used in subsection 1453(b), is arguably ambiguous, the portion of the Committee Report that defendants rely upon does not resolve that possible ambiguity.
Werner v. KPMG LLP, 415 F.Supp.2d 688, 693 (S.D.Tex.2006).
As their last gasp, defendants argue that the entire action is removable because Braud, properly construed, requires it. Despite the Fifth Circuit's clearly explaining that the action became removable only
Despite CAFA, federal courts are still courts of limited jurisdiction. While CAFA admittedly broadens federal removal jurisdiction, it does not unanchor the federal courts from the basic principle of federalism that requires the construction of removal statutes against a removing defendant.
Moniz presented to the district court in Massachusetts a question of the CAFA removability of a case involving the question of the possible "relation back" of an amendment that made a substantive change in a theory, or that added new claims for relief after the enactment of
The court having concluded that the CAFA removal provisions apply only to Alabama Power and Filler Products, and that the action against the original defendants cannot tag along, the court next examines whether the removal by the two post-CAFA parties was effective. The court knows of no reason why Filler Products is excused from compliance with 28 U.S.C. § 1446(b) and (d) which required it to remove, as Alabama Power did, within thirty days after it first received a paper alerting it to the fact of removability. However, this failure by Filler Products becomes academic in light of the conclusion this court reaches that the substantive removal requisites for post-CAFA removal were not met either by Alabama Power or by Filler Products.
To repeat for the third time, in CAFA "jurisdiction shall exist only over those plaintiffs whose claims in a mass action satisfy the jurisdictional amount requirements under subsection (a)." 28 U.S.C. § 1332(d)(11)(B)(i). As in diversity removals generally, the amount in controversy must "exceed the sum or value of $75,000, exclusive of interest and costs." 28 U.S.C. § 1332(a). The original nine plaintiffs specified in their original complaint that each demanded $1,250,000 plus costs. However, nowhere in any subsequent amendment does any plaintiff claim or otherwise designate a specific amount of damages, and Alabama Power was not added as a defendant until the third amended and recast complaint was filed. Alabama Power apparently argues that, because CAFA became effective before plaintiffs filed their first amended and recast complaint — i.e., when the complaint contained an express demand of more than $75,000 in damages for each plaintiff — the jurisdictional amount requirement of 28 U.S.C. § 1332(d)(11)(B)(i) has been met. Alabama Power's argument is unconvincing because the action had not "commenced" as to it when the original complaint was still in effect. The action did not so "commence" as to Alabama Power until the third amended and recast complaint was filed, and by that time plaintiffs had eliminated any specification of damages being sought. It is of no consequence that CAFA became effective when the astronomical amount in controversy was still specified in the complaint, because such amount was
By the time this action could possibly have become a "mass action" removable under CAFA, the complaint in effect was silent as to the amount in controversy. And when a state court complaint is uncertain or silent on the amount being sought, the removing defendant under 28 U.S.C. § 1332 has the burden of proving the jurisdictional amount by a preponderance of the evidence. Leonard v. Enterprise Rent A Car, 279 F.3d 967, 972 (11th Cir.2002).
Does the fact that none of these named 419 plaintiffs disclaim and disavow all intention or hope of recovering more than $75,000, and that they are willing to engage in wishful thinking that their total claims are worth $5,000,000, constitute proof of the existence of the CAFA jurisdictional amount? Defendants say that it does. Plaintiffs say that it does not. It comes down to which side has the burden of proof on this subject, and how, and if, that burden can be met in a "mass action" case. The Eleventh Circuit has recently gotten ahead of the district court who wrote Moniz by holding that
In Evans, the Eleventh Circuit was considering whether the defendant or the plaintiff bears the burden of proving CAFA's "local controversy exception" to jurisdiction after the base requisites of removal jurisdiction had already been met. 449 F.3d at 1161. CAFA's local controversy
28 U.S.C. § 1332(d). (emphasis added).
The Eleventh Circuit concluded that because this is a 20 provision that requires the court to decline an exercise of jurisdiction, even though jurisdiction otherwise exists under CAFA, plaintiffs there had the burden of establishing the requisites for the exception. 449 F.3d at 1164.
The $75,000 limitation in 28 U.S.C. § 1332(d)(11)(B)(i) is quite unlike the local controversy exception of 28 U.S.C. § 1332(d)(4). If there is an absence of $75,000 in controversy, there is no jurisdiction ab initio and thus nothing to decline. Federal jurisdiction simply does not exist over claims of less than $75,000. The "local controversy" exception describes a situation in which jurisdiction exists but in which the court must decline to exercise it. Alabama Power's myopic focus on the word "except" does not change this distinction. The. $75,000 proviso is not an "exception" to federal jurisdiction, but a criterion for determining whether federal jurisdiction exists in the first place. In Evans, the Eleventh Circuit squarely recognized that the burden of establishing jurisdiction in a CAFA case is on the party seeking removal, and the $75,000 amount in controversy is a necessary element of federal jurisdiction, upon which the removing defendant has always had and still has the burden of proof. 449 F.3d at 1164.
The same analysis appertains as to the $5,000,000 required for CAFA jurisdiction, although this aggregation concept is contained in a subsection of CAFA separate from the individual $75,000 limitation in "mass action" cases.
While insisting that each plaintiff has the burden of proving the absence of $75,000 in controversy in order to obtain a remand of his claim, Alabama Power takes the fallback position that if it bears the burden of establishing $75,000 in controversy, that burden only applies as to one plaintiff, and that it has met that burden by virtue of counsel's in-court admission, a concession that, according to Alabama Power, reimposes upon plaintiffs the burden of establishing which of them expect to recover less than $75,000 and thus be entitled to a severance and remand.
Alabama Power relies upon the following colloquy that occurred in open court:
Alabama Power's argument loses steam quickly because, even if Mr. Gathings' conclusory statement suggests that
Mr. Gathings' in-court statement cannot satisfy Alabama Power's burden of establishing the jurisdictional amount as to some plaintiff or plaintiffs. The statement only reflects Mr. Gathings' belief that at least one of his clients has a claim exceeding $75,000 in value, but the voicing of his opinion cannot establish for which plaintiff or plaintiffs Mr. Gathings holds this belief, or on what his belief is based. Moreover, in response to the court's order requiring plaintiffs to provide information concerning the values of their individual claims, plaintiffs forthrightly explained that they do not know which, if any, have claims that may reasonably be expected to exceed $75,000 in value. Mr. Gathings did not specify, because he could not, which plaintiffs have claims whose values exceed $75,000. This is not his fault. The court can well understand his reluctance to place a cap on individual claims when there remains a lot of discovery to be done on the subject of the damages of various and sundry types possibly suffered by widely divergent plaintiffs.
Defendants' hopeful conjecture based on Alabama jury verdicts in cases that may have some similarity to this case, but are not closely similar, do not suffice to remove the obligation of the removing defendants to prove that the jurisdictional amount exists in a case in which no plaintiff has formally claimed a particular sum, much less a sum more than $75,000. For the fourth and final time, 28 U.S.C. § 1332(d)(11)(B)(i) provides that "jurisdiction shall exist only over those plaintiffs whose claims in a mass action satisfy the jurisdictional amount requirements under subsection (a)." The statute does
In the two cases proffered by Alabama Power, plaintiffs sued over alleged pollution and recovered more than $75,000 in an Alabama court. Such anecdotal evidence, although it is quite often cited in notices of removal in diversity cases as proof of the value of a removed claim, is not enough to establish jurisdiction in a "mass action"
Because Alabama Power has not met its burden of establishing jurisdiction over a single named plaintiff, much less over all plaintiffs, this court cannot keep any part of this case. It cannot logically remand only the claims of those plaintiffs whose cases are worth less than $75,000 when there is no basis for distinguishing one plaintiff from another. The court cannot merely guess, and cannot retain jurisdiction over the whole case against Alabama Power or any other defendant during the period in which the parties try to ascertain which, if any, of the 419 claims is worth more than $75,000. If the court kept the case temporarily, it would eventually be forced by 28 U.S.C. § 1447(c) to remand most of the claims because it will surely appear after further discovery that they are worth less than $75,000.
There are alternative reasons why this case must be, or should, in the interest of justice, be remanded.
First, "the term `mass action' shall not include any civil action in which . . . all of the claims in the action arise from an event or occurrence in the State in which the action was filed, and that allegedly resulted in injuries in that State. . . ." 28 U.S.C. § 1332(d)(11)(B)(ii)(I). Although in the case before the court the facts pertinent to an application of this statutory provision have not been fully developed, it facially appears that the language, if and when applied, will prevent the action from constituting a "mass action", and will destroy CAFA removability.
Second, according to 28 U.S.C. § 1332(d)(11)(A), in order for a "mass action" to be removable, it must meet the general requirements of a "class action" as defined in 28 U.S.C. § 1332(d)(2) through (10). The instant action falls short of these requirements. The court need not tick off the various failures to meet the "class action" definition. They require evaluation only if the court is incorrect as to other fatal jurisdictional defects already dismissed.
Third, if this action qualifies as a "mass action," the court is required to decline jurisdiction
Plaintiffs have requested reconsideration of the August 16, 2006 order requiring them to provide the names and addresses of all plaintiffs whose claims can reasonably be expected to exceed $75,000 in value, together with a one-paragraph explanation as to why particular claims are worth more than $75,000. As previously discussed in another context, plaintiffs explain that they do not have this information, and ask the court either to set aside the order or to accept their enigmatic answer as a sufficient explanation for their failure to provide the requested information. Believing that plaintiffs cannot be expected to know the values of their claims at this juncture, the court will grant their motion.
Because this purported "mass action" was commenced against the original defendants before the enactment of CAFA, those defendants cannot avail themselves of CAFA, and the court accordingly must remand this action as to them. Because the two defendants who were added after CAFA's enactment have failed to establish that this court has subject-matter jurisdiction over the claims of any particular plaintiff, much less over all plaintiffs, the court will also remand the action as to the two defendants added after the enactment of CAFA.
A separate order of remand will be entered