Friday, June 12, 2009

Removal Jurisdiction is Based on Pleadings or Documents Provided by Plaintiff - Not Defendant

In Thomas v. Bank of America Corporation (09-11143), the Eleventh Circuit issued a published opinion on removal jurisdiction.

The Court held:

"Bank of America filed a Notice of Removal to the United States District Court for the Middle District of Georgia, contending that jurisdiction was appropriate because the action qualified as a 'mass action' under the Class Action Fairness Act of 2005 (“CAFA”), Pub. L. No. 109-2, 119 Stat. 4 (codified in scattered sections of 28 U.S.C.). Under CAFA, to remove a mass action to federal court, a defendant must show: (1) an amount in controversy of an aggregate of $5,000,000 in claims: (2) minimal diversity; (3) numerosity involving monetary claims of 100 or more plaintiffs; and (4) commonality showing that the plaintiffs’ claims involve common questions of law or fact."

The plaintiff did not provide any "information relating to the amount in controversy or the number of plaintiffs in each class, Bank of America supplemented its Notice of Removal with a declaration that stated that '[f]rom October 23, 2006 through June 30, 2008, Defendant enrolled 77,787 customers and collected a total of $4,825,809 in fees from customers in Georgia for the Credit Protection Plus plan'." Bank of America argued that the statutes application of treble damages brought the amount to a figure well above the requisite $5,000,000.00.

The district court remanded the action to Georgia state court because the complaint did not establish the requisite amount in controversy. "The court thus concluded that there was “great uncertainty regarding the amount in controversy and the class size.”

"A case does not become removable as a CAFA case until a document is 'received by the defendant from the plaintiff—be it the initial complaint or a later received paper . . . [that] unambiguously establish[es] federal jurisdiction'...Once such a document is received, the defendant has thirty days to file the notice of removal. 28 U.S.C. § 1446(b)."


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