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CAFA Law Blog

Information, cases and insights regarding the Class Action Fairness Act of 2005

ACI’s 26th National Conference on Consumer Finance Class Actions & Litigation, July 28-29

Posted in Events


ACI’s 26th National Conference on Consumer Finance Class Actions & Litigation

July 28-29, 2016

The Omni Chicago Hotel

Chicago, IL


Consumer financial services companies are facing unprecedented regulatory and enforcement scrutiny, mounting litigation, and costly class actions. That is why it is essential that in-house and outside counsel attend the ACI’s 26th National Conference on Consumer Finance Class Actions & Litigation on July 28-29, 2016 in Chicago, IL. to learn and master the latest enforcement actions and regulatory initiatives, and the most effective defense and settlement strategies.

A Noteworthy Event – ACI’s National Conference on Consumer Finance Class Actions & Litigation

Posted in Events

Between the recent SCOTUS decisions and the CFPB’s flurry of activity, including the proposed rule on arbitration, it is clear that the consumer finance landscape is in the midst of a massive upheaval.

Join the nation’s leading consumer finance attorneys at ACI’s 26th National Conference on Consumer Finance Class Actions & Litigation and be a part of the conversation as to where the industry is headed in the coming months.

Dates and registration:

Click here to register online or call (888) 224-2480.

Thursday, July 28 – Friday, July 29, 2016

The Omni Chicago Hotel, Chicago, IL

10% off conference rate with code: D10-999-CLB16 Continue Reading

A Noteworthy Event – March 17-18, 2016

Posted in Events

Retail data breaches continue to evolve and bring new litigation and trends in the Data Breach and Privacy Litigation context. Business to business claims, vendor lawsuits, litigation between issuing banks and retailers post-breach, the ecosystem of payment card breaches, and Genesco decision implications are just some of the topics analyzed and discussed in greater detail. Click here for the pdf of the agenda. Continue Reading

Certain claims carry a presumption as to amount-in-controversy that will lead directly to federal court

Posted in Case Summaries

Robertson v Exxon Mobil Corp., 2015 WL 9592499 (5th Cir. Dec. 31, 2015).

In a personal injury and a property damage action, the Fifth Circuit reversed the district court’s order remanding the action finding that the defendants had by preponderance of evidence shown that at least one plaintiff’s claim exceeded $75,000. Specifically, the Fifth Circuit found that when a plaintiff claims that he/she contracted cancer, or a claims damages for wrongful death, the Fifth Circuit precedent has always held that such claims more likely than not exceeded federal jurisdictional threshold even when the amount-in-controversy is not alleged in the complaint. Continue Reading

Fifth Circuit weighs in on ambiguous class definition

Posted in Case Summaries

Arbuckle Mountain Ranch of Texas Inc v Chesapeake Energy Corporation, Case No. 15-10955, 2016 WL 98128 (5th Cir. Jan 7, 2016). In a 2-1 decision, the Fifth Circuit examined an ambiguous complaint suggesting two class definitions, (one a narrow definition and another containing a broad definition) and held that if the pleadings entirely lean towards a broader definition, it should be assumed that the plaintiff intended to define a broader class.  The Fifth Circuit found that the broader definition defeated CAFA’s local controversy exception, and reversed and remanded. Continue Reading

A Noteworthy Event

Posted in Events

ACI’s Data Breach & Privacy Litigation and Enforcement conference, March 17-18, 2016 at the Union League in Philadelphia. Click here for the pdf of the agenda.

This premiere conference is led by an unparalleled faculty of in-house counsel, federal judges, and the top outside counsel plaintiff and defense litigators and firms. It has networking opportunities galore and features innovative and highly relevant content that will allow you to benchmark your current data breach, TCPA and privacy strategies.

Some of the issues to be discussed this year include:

  • Class Actions: Data Privacy & Security Breach Case Law Trends in Key Jurisdictions and Circuit Court Rulings; New Class Certification Issues; Novel Standing, Causation, Damages, Injury and Actual Harm Nuances; and How the Neiman Marcus and Spokeo Decisions Have and Will Continue to Change the Landscape
  • New Claims Involving the Video Privacy Protection Act and Telephone Consumer Protection Act (TCPA) and Related State Law Claims
  • Federal and State AG Enforcement for Invasion of Privacy, Data Breaches, and Failure to Comply with Notification Statutes: FTC Authority & Litigation, Wyndham Case Implications, Multi-State/ Agency Investigation and Audits, Negotiation, Settlement, Trial, and How the Various Actions Are Proceeding and Being Resolved
  • Shareholder Derivative Lawsuits
  • Business to Business Claims
  • International Data Breaches and resulting litigation and enforcement
  • Attorney/Client Privilege Issues Arising out of Breach Notification

Additional details and registration information are available at http://www.AmericanConference.com/DataBreach or by calling 888-224-2480.

Please mention this code when registering: B00-999-CLB16

Removal Untimely Where State Court Pleading Acknowledges Grounds For Removability Previously Ascertained

Posted in Uncategorized

Addison v. The Netherlands Ins. Co., 2015 WL 461958 (D. Mass. Feb. 4, 2015)

A district court in Massachusetts remanded a case to state court finding that a delay in filing a notice of removal unjustifiable when the complaint, the defendants’ prior filings, and underlying circumstances provided defendants with sufficient grounds to timely ascertain their basis for removal.

The defendants filed a notice of removal almost three years after the 30 day initial period of removability. They contended that the grounds for removability were only first ascertained by a state court order on their motion to dismiss that referenced a decision implying that this present action could be construed as a class action.

The Court noted, however, that the initial filing provided the defendants with information from which it could ascertain the basis for removability. Even though the complaint did not classify the matter as a class action, it specifically sought relief on behalf of the plaintiff “individually and as the representative of a class of similarly-situated persons.” It also attached and referred to a prior, related action, that was a class action, and that provided defendants with citizenship of the class members. The prior action also provided enough information to ascertain the amount in controversy.

Moreover, in their motion to dismiss, the defendants relied extensively on a decision that was directly on point and involved the same plaintiff. That decision held that the plaintiff only had standing to pursue its case as a class representative, which was the basis on which defendants sought dismissal of this present action. Asserting that position necessarily meant that the defendants had, by the time of filing the motion to dismiss, ascertained the basis for their removal of the action. However, rather than remove the action, defendants attempted to dismiss it. The Court noted that defendants’ attempt to remove the action came only after their unavailing effort at dismissing the case, stating: “Now that [defendants] strategy has not succeeded, they seek to rely on the one-sentence order [denying the motion to dismiss] to toll the clock for removal.” Because defendants had the ability to ascertain grounds for removability at the time of filing the complaint, and at latest at the time of filing their motion to dismiss, removal was untimely. Accordingly, the Court granted the plaintiff’s motion to remand.

Calculation of 100 or more does not include unnamed parties

Posted in Case Summaries

Stump v Camp, 2014 WL 582813 (E.D. La. Feb. 13, 2014).

In an action brought by employees of a company who alleged fraud due to an alteration in the plan documents which denied them additional benefits that they were entitled to, the district court remanded the action finding that the under Louisiana law, the spouses cannot be included in the class definition for the purposes of ascertaining numerosity requirement for federal subject matter jurisdiction under CAFA.

The current and former employees of Pamlab, LLC., brought an action in the Twenty-Second Judicial District Court for the Parish of St. Tammy against the defendants Samuel M. Camp, Judith M. Camp, Camline LLC f/k/a/ Pamlab, LLC. The plaintiffs alleged that while they were employed at Pamlab over the past 20 years, they earned points in an “Incentive Points Employee Compensation Plan,” which the plaintiffs characterized as stock. The plaintiffs claimed that they were told that if the company was ever sold, the worker still employed could liquidate their points into cash. According to the plaintiffs, in 2012, Pamlab terminated the points system, but they were informed that plaintiffs could either elect to receive a cash payment based on how many points they formerly held or they could receive the same number of points under the newly adopted 2012 incentive plan.

The plaintiffs contended that they chose to cash in their points because the new plan lasted only until 2017, but the company reserved the right to terminate the plan at any point in time. The plaintiffs claimed that Nestle bought over Pamlab in 2013, but the defendants were already negotiating a sale when the 2012 plan came into force. The plaintiffs felt shortchanged, and hence, filed this action. The defendants removed this case under CAFA, and the plaintiffs moved to remand.

In their motion to remand, the plaintiffs argued that that federal court did not have jurisdiction under CAFA because there were not more than 100 class members, the plaintiffs pointed out that in the defendants’ notice of removal they admitted that there were only 87 Pamlab employees who constituted members of the putative class action. The defendants countered by pointing to the plaintiffs’ complaint where the plaintiffs claimed that there were over 100 potential class members. The defendants contended that the jurisdictional facts are evaluated based on the pleadings at the time of the removal. In the alternative, the defendants argued that the plaintiffs had failed to join indispensable parties, who, when joined, would satisfy the numerosity requirement. The defendants claimed that the Federal Rules of Civil Procedure requires spouses in community property states to be joined because they have interests related to the subject matter of the action.

Here, the district court observed that the plaintiffs’ definition of the proposed class was very specific i.e., all individuals employed by Pamlab, who held points and who elected to receive cash payment for those points by signing a release agreement, and who remained employees until the company was sold. The district court remarked that the class definition did not include spouses who lived in community property, therefore, it could not consider the spouses when assessing the jurisdictional requirements under CAFA. In support of its conclusion, the district court relied on Mississippi ex rel. Hood v. AU Optronics Corp., 134 S.Ct. 736 (2014), where the United States Supreme Court rejected the theory that CAFA’s definition of a mass action included unnamed persons who were real parties in interest. (Editor’s Note: See the CAFA Law Blog analysis of Hood posted on October 8, 2014). The Supreme Court reasoned that the statute says 100 or more persons, not 100 or more named or unnamed real parties in interest. The Supreme Court continued that had Congress intended the later, it easily could have drafted language to that effect. Similarly, here, the district court concluded that if the Congress wanted to include all named and unnamed interested or required parties, it could have included that language, instead, the choose to require 100 or more named or unnamed persons who fell within the definition of the proposed class. Accordingly, the district court concluded that the CAFA definition does not infer an inclusion of the spouses in this case.

The defendants then argued that spouses should be included in assessing CAFA’s numerosity requirement based on the Louisiana’s community property regime – Louisiana Civil Law Treaties: Matrimonial Regimes § 1:1 (3d ed. 2013). The defendants pointed to Louisiana Civil Code Article 2336, which provides that each spouse owns a present undivided one-half interest in the community property. The district court noted that the present case involves a breach of contract claim made by current and former employees of the Defendants. In the complaint, the plaintiffs claimed that the defendants breached their contract by terminating the Incentive Points Employee Compensation Plan. The plaintiffs alleged that the Release Agreement that they signed should be rescinded due to the defendants’ fraud and misrepresentation. The employees who were parties to those employment-related contracts were the only parties who were in privity of contract with the defendants. The district court found no reason to alter this understanding based on the contents of the contracts. The district court concluded that according to Louisiana law, joinder of the spouses in the present case was not mandatory. In addition, the district court remarked that the defendants did not point to any reason why the failure to join the spouses would result in an injustice to those spouses. Accordingly, the district court concluded that under Louisiana law there were only 87 members of the proposed class.

Accordingly, the district court remanded the case to the state court. –JR