Duane Morris Class Action Review - 2023 - Report - Page 93
improperly discounting the defendant’s substantial evidence showing the amount-incontroversy was satisfied, the district court had impermissibly imposed an unrealistic
burden on the defendant that “contravenes the text and understanding” of the CAFA
“and ignores precedent.” Id. at 992. The Ninth Circuit opined that the district court
improperly “put a thumb on the scale against removal” by assigning a $0 value to most
of the plaintiff’s claims simply because it disagreed with the assumptions underlying the
defendant’s estimates. Id. at 992. The Ninth Circuit reasoned that preferring an
alternative assumption is not an appropriate basis to zero-out a claim, and “at most, it
only justifies reducing the claim to the amount resulting from the alternative
assumption.” Id. at 994. For these reasons, the Ninth Circuit determined that the district
court’s approach turned the CAFA removal process “into an unrealistic all-or-nothing
exercise of guess-the-precise-assumption-the-court-will-pick - even where . . . the
defendant provided substantial evidence and analysis supporting its amount in
controversy estimate.” Id. The Ninth Circuit also noted the expansive understanding of
the CAFA under its circuit precedent, and encouraged district courts to give defendants
“latitude” when analyzing removal as long as the defendant’s “reasoning and underlying
assumptions are reasonable.” Id. at 993.
In Chaisson, et al. v. University Of Southern California, 2022 U.S. Dist. LEXIS 190410
(C.D. Cal. Oct. 17), the plaintiff filed a putative class action complaint in state court
against the defendant related to late fees charged by the defendant. On June 22, 2022,
the plaintiffs filed a motion for class certification, which sought to certify a nationwide
class rather than the more-narrow California-only class set forth in the pleadings. On the
basis of the motion to certify, the defendant removed the action pursuant to the CAFA.
Id. at *2. The court granted in part and denied in part the plaintiff’s motion to remand.
The defendant argued that removal was timely because all three of the plaintiff’s
pleadings defined the class so as to include only California residents, and since the
defendant is a California citizen, diversity jurisdiction under the CAFA did not exist. The
plaintiffs argued the case was not removable based on their motion to certify, since
when the defendant removed the action, the state court had neither certified a
nationwide class, nor granted the plaintiffs’ motion to amend the complaint to include an
expanded class definition. The court held that the pending motion for class certification
did not render this action removable under the CAFA. Id. at *6. Accordingly, the court
granted the plaintiffs’ motion and remanded the action to state court. Id. at *6-7.
In Schroeder, et al. v. Host International, Inc., 2022 U.S. Dist. LEXIS 25470 (C.D. Cal.
Jan. 24, 2022), the plaintiff filed a class action in state court alleging that the defendant
violated various provisions of the California Labor Code. The defendant removed the
action. The court subsequently requested that the parties address three issues related
to the CAFA’s amount-in-controversy requirement, including: (i) the amount-incontroversy for each separate claim; (ii) if the defendant’s amount-in-controversy
calculations would still meet the requirement for removal under the CAFA if some of the
claims were dismissed; and (iii) whether the defendant’s calculations were reasonable.
The defendant argued that even if some of the plaintiff’s claims were dismissed for lack
of standing, jurisdiction under the CAFA would be unaffected because “post-filing
developments do not defeat jurisdiction if jurisdiction was properly invoked at the time of
filing.” Id. at *13. The court rejected the defendant’s argument. It opined that the Ninth
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Duane Morris Class Action Review – 2023
