Brill v. Countrywide Home Loans, Inc., 427 F. 3d 446, No. 05-8024, 2005 WL 2665602 (7th Cir. Oct. 20, 2005)
The Seventh Circuit issued an opinion on October 20, 2005, in which it addressed an issue vigorously litigated since the enactment of the Class Action Fairness Act of 2005 — whether CAFA shifts the burden of proof in a removal dispute from the removing party to the party resisting federal court jurisdiction (usually the plaintiff). In this case, James Brill initially sued Countrywide Home Loans in Illinois state court after the effective date of CAFA for alleged violations of the Telephone Consumer Protection Act, and Countrywide immediately removed the case to federal court on CAFA jurisdiction grounds. Although there were more than 100 putative class members and minimal diversity was present, the district court remanded the case to state court, finding that Countrywide had failed to discharge its burden of proving that the amount in controversy exceeded $5 million, and also finding that the TCPA provided exclusive state court jurisdiction over TCPA private party claims. Editor’s Note: See the CAFA Law Blog post on October 22nd under the “Case Summaries” category for a summary of and link to the district court’s decision.
On appeal, the Seventh Circuit first addressed Countrywide’s argument that CAFA shifts the burden of proof in a removal dispute to the party opposing jurisdiction, which Countrywide supported by citing the Senate Judiciary Committee Report on CAFA. In an opinion authored by Justice Easterbrook, the Court rejected this argument, declaring, “When the legislative history stands by itself, as a naked expression of ‘intent’ unconnected to any enacted text, it has no more force than an opinion poll of legislators.”
The Court further concluded that in order to change the long-standing rule on the burden of persuasion in removal cases, Congress must instead enact a statute, which the President must then sign, as a declaration by 13 Senators is simply insufficient.
The Court then, however, applied pre-CAFA standards, and determined that Countrywide had in fact met its burden of showing that the CAFA jurisdictional minimum amount in controversy of $5 million was satisfied. The Court also rejected Brill’s argument that removal was improper on the grounds that state courts have exclusive jurisdiction over suits brought under the Telephone Consumer Protection Act.
The Seventh Circuit reversed the district court’s remand order, and remanded the case to the district court for a decision on the merits. In doing so, the Court recognized that CAFA’s amendments to the removal provisions allowed the Court to undertake appellate review of the entirety of a district court’s decision, not just a mistake in application of CAFA.