Knudsen, et al. v. Liberty Mutual Insurance Company, 411 F. 3d 805, 2005 WL 1389059 (7th Cir. June 7, 2005)
The Seventh Circuit has weighed in with its interpretation of the “date of commencement” under CAFA. The class action by Knudsen was initially filed in Illinois state court in 2000. Liberty Mutual removed the suit after adoption of CAFA, based in part on the plaintiffs’ expansion of the class definition to include customers of a new corporate entity not a party to the suit.
The Seventh Circuit noted that the “district judge promptly sent it back, observing that March 2000 precedes February 2005.” Attempting to sidestep the failed defense argument in Pritchett that “removal equals commencement,” Liberty Mutual argued that any substantial change to the class definition “commences” a new case. The Seventh Circuit unequivocally disposed of Liberty Mutual’s “significant change equals commencement” argument (the expansion of the class definition), noting that although the new class definition may be flawed for other reasons, that fact in and of itself does not make the case removable under CAFA.
The Court hinted that a new claim or cause of action, the addition of new defendants, or another modification sufficiently distinct that a court would treat it as independent for limitations purposes might be a “commencement” for CAFA purposes. The court created an analogy to typical removal practice, where pleadings, amendments, or new defendants might create new windows for removal. The Seventh Circuit stated that that the court “can imagine, although we need not hold, that a similar approach will apply under the 2005 Act [CAFA], perhaps modeled on FED. R. CIV. P. 15(c) . . .” and the relation back doctrine under that rule.
Practice Note: The defendants filed a motion for leave to appeal the remand decision, which was denied by the Seventh Circuit. Knudsen filed a motion to strike the petition for leave to appeal, a tactic criticized by the Court, which expressly stated, “[w]e hope that in the future potential appellees will address the issues directly rather than move to strike the appellants’ papers . . . ” and noted that a motion to strike begs the question of the applicability of CAFA.