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

The Plaintiff Is the Lord and Master of His Complaint

Posted in Case Summaries

Hampton v. Monsanto Co., No. 4:11–CV–1662 (CEJ), 2011 WL 5307835 (E.D. Mo. Nov. 3, 2011).

In this action, a District Court in Missouri held that Congress appears to have contemplated that the plaintiffs as masters of their complaint may include or omit claims or parties in order to determine the forum.

The plaintiffs, three California residents, brought an action against the defendants, Monsanto Co., Solutia, Inc., Pharmacia Corp., and Pfizer, Inc., alleging that they developed Non–Hodgkins lymphoma after being exposed to polychlorinated biphenyls (PCBs), and asserted claims for strict liability and negligence under California law.  

This action is one of eleven lawsuits brought by individuals who claim that they developed Non–Hodgkins lymphoma as a result of exposure to PCBs.  The eleven cases were filed in Los Angeles County, California, St. Louis County, Missouri, and St. Louis City, Missouri.  The plaintiffs in all eleven cases are represented by the same counsel and bring substantially similar claims of negligence and design defect against the same defendants.  

The defendants removed to the Eastern District Court four of the six cases filed in St. Louis County and all three of the cases filed in St. Louis City, contending that the cases were removable as a “mass action” under CAFA because there was no colorable basis for the plaintiffs’ decision to file separate cases other than a desire to remain below the 100–plaintiff threshold. 

The plaintiffs moved to remand this action to state court, which the District Court granted.

Like class actions, CAFA also provides federal jurisdiction over a “mass action,” which is defined as “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 …,” 28 U.S.C. § 1332(d)(11)(B)(i).  Section 1332(d)(11)(B)(ii)(II) and (IV) explicitly excludes from the definition of “mass action” those civil actions in which “the claims are joined upon motion of a defendant” or “the claims have been consolidated or coordinated solely for pretrial proceedings.”

The defendants asserted that this three-plaintiff case satisfied the definition of mass action when combined with the other removed cases.  Specifically, the defendants noted that, on September 9, 2011, the plaintiffs’ counsel filed two separate cases in the St. Louis City Circuit Court, one with 95 plaintiffs and one with 96 plaintiffs.  They cited this history as evidence that the plaintiffs’ counsel purposefully chose to “splinter” a single case for the purpose of evading federal jurisdiction.  The defendants asked the Court to disregard such manipulations and cited Freeman v. Blue Ridge Paper Prods., Inc., 551 F.3d 405 (6th Cir.2008), and Westerfeld v. Independent Processing, LLC, 621 F.3d 819 (8th Cir.2010) for support. (Editors’ Note: See the CAFA Law Blog analysis of Freeman posted on February 17, 2009 and the CAFA Law Blog analysis of Westerfeld posted on September 13, 2010.)

The Court noted that in Freeman, a single class of plaintiffs divided their cause of action into five distinct law suits, each covering a different, sequential, 6–month period, with damages in each suit just under CAFA’s $5 million threshold.  Under this circumstance, the Sixth Circuit held that the damages sought in the separate cases “must be aggregated,” thereby satisfying CAFA’s jurisdictional requirement.  The Sixth Circuit observed that “the complaints are identical in all respects except for the artificially broken up time periods.  Plaintiffs put forth no colorable reason for breaking up the lawsuits in this fashion, other than to avoid federal jurisdiction. In fact, plaintiffs’ counsel admitted at oral argument that avoiding CAFA was the only reason for this structuring.”  

The Court, however, declined to rely upon Freeman because it did not address the “mass action” provisions of CAFA that were at issue in this case.

Similarly, the Court refused to rely on Westerfeld.  Under the context of ‘local controversy exception,’ the Eighth Circuit had held in Westerfeld, that “whether an in-state defendant is a significant defendant for purposes of the local-controversy exception must be determined by considering the claims of all of the class members in the class action and not by considering the claims of class members on a class-by-class basis.” Westerfeld, however, did not address the mass action provisions.

The Court observed that CAFA was explicit that the defendants could not satisfy the 100 plaintiffs’ requirement by seeking consolidation of the actions.  The Court remarked that the defendants’ contention that the plaintiffs had deliberately divided their cases in order to avoid the mass action threshold was irrelevant. 

To support its findings, the Court relied on the observations in Anderson v. Bayer Corp., 610 F.3d 390, 393 (7th Cir. 2010), which held that “by excluding cases in which the claims were consolidated on a defendant’s motion, Congress appears to have contemplated that some cases which could have been brought as a mass action would, because of the way in which the plaintiffs chose to structure their claims, remain outside of CAFA’s grant of jurisdiction. This is not necessarily anomalous; after all, the general rule in a diversity case is that ‘plaintiffs as masters of the complaint’ may include (or omit) claims or parties in order to determine the forum.” (Editors’ Note: See CAFA Law Blog analysis of Anderson posted on September 8, 2010.)

Concluding that this case did not satisfy the requirements of a “mass action,” the Court remanded the action to state court.