Turner v. Corinthian International Parking Services, Inc., 2015 WL 7768841 (N.D. Cal. Dec. 3, 2015).
A district court granted the plaintiff a chance to amend the complaint to clarify on the citizenship of the class members to ascertain whether the case was removable under CAFA. In doing so, the Court relied on the Ninth Circuit’s recent ruling in Benko, which deviated from the earlier stance that “once a CAFA always a CAFA.”
The plaintiff brought this putative wage and hour class action against the defendant Corinthian International Parking Services, Inc. in the Superior Court of California, Alameda. The plaintiff asserted seven causes of action arising under California law, including claims for unpaid overtime, unpaid mean period premiums, unpaid rest period premiums, failure to pay minimum wage, failure to timely pay final wages, unreimbursed business expenses, and unfair business practices. The plaintiff sought compensatory damages, statutory damages, penalties, interest, attorney’s fees, and costs. The defendant removed the action under CAFA, and the plaintiff moved to remand.
The plaintiff argued that the jurisdiction of the federal court under CAFA failed for three reasons: (1) the defendant failed to establish the diversity of citizenship; (2) the defendant failed to established that the amount in controversy exceeded $5 million; and (iii) both the local controversy exception and the home state exception to the CAFA jurisdiction applied in this case.
In the Notice of Removal, the defendant alleged that at least one proposed class member was not a citizen of California. The plaintiff contended that this allegation was insufficient to establish diversity because the defendant did not allege the actual citizenship of the relevant parties. Moreover, the plaintiff contended that diversity was impossible because the proposed class only included California citizens. Specifically, the plaintiff noted that the complaint defined the proposed class to consist of only California based employees who were employed by the defendant in the state of California. According to the plaintiff, by operation of the class definition, persons domiciled in another state were not included in the proposed class.
The defendant argued that the plaintiff misconstrued the class definition, and that the class of California based employees was not necessarily limited to California citizens. According to the defendant, the class definition said nothing about the employees’ domicile. Therefore, former employees currently domiciled in another state would still be part of the proposed putative class.
The Court observed that as the defendant was a citizen of California. Diversity, therefore, would depend on the construction of the plaintiff’s proposed class definition. In his reply brief, the plaintiff insisted that the proposed class was explicitly limited to all California based individuals, meaning those individuals who were currently based or domiciled in California. Relying on Johnson v. Advance America, 549 F.3d 932 (4th Cir. 2008), the plaintiff asserted that any individuals who were not California citizens were not putative class members. The Court remarked that the challenge for the plaintiff, however, was that his complaint failed to limit the putative class as explicitly in Johnson.
Further, the Court stated that although post removal amendments to the pleadings cannot affect whether a case is removable, the Ninth Circuit in Benko v. Quality Loan Services Corp., 789 1111 (9th Cir. 2015) held that the plaintiffs should be permitted to amend the complaint after the removal to clarify issues pertaining to federal jurisdiction under CAFA.
Here, the Court observed that the pleadings did not expressly allege that non-California citizens were excluded from the class definition. Therefore, based on the record presented, the Court could not remand the action for lack of diversity. Nonetheless, the Court stated that the plaintiff should be afforded the opportunity to amend the pleadings to clarify the putative class definition.
Accordingly, the Court denied the plaintiff’s motion to remand without prejudice to the plaintiff’s ability to renew the motion after filing the amended complaint.
Because the Court’s finding with regard to diversity was dispositive, the Court did not examine the amount in controversy.