Lenahan v. Dick’s Sporting Goods, Inc., No. 1:10-CV-11832-RGS, 2010 WL 5092254 (D. Mass. Dec 08, 2010).

In this case, a District Court in Massachusetts declined to remand the action to state court, reasoning that whether a defendant has shown a reasonable probability that the amount in controversy exceeds $5 million may include an analysis of evidence in the record presented by both sides. 

After a district court in New York rejected the plaintiffs’ attempt to convince the court to exercise supplementary jurisdiction over the plaintiffs’ Massachusetts law claims, the plaintiffs took another shot by filing this putative wage and hour class action in Massachusetts state court.

Deciding that the best defense is a good offense, the defendants removed the case to the District Court invoking CAFA, 28 U.S.C. § 1332(d). 

The plaintiffs predictably challenged the call and requested remand, which the District Court summarily denied.

In opposing the motion to remand, the plaintiffs narrowed their target to the defendants’ assertion that the amount in controversy exceeded $5 million. While the Court stated that the ball was in defendants’ hands to demonstrate that the amount in controversy is met, it also stated that the defendants’ burden is not onerous because little to no evidence is typically produced by the time of removal. Accordingly, the court explained that it need not view the available evidence solely in the light most favorable to the plaintiffs, but may evaluate all evidence in the record presented by both sides.

In the course of that evaluation, a federal court may consider which party has better access to the relevant information. Merely labeling the defendant’s showing as “speculative” without discrediting the facts upon which it rests will not score any points with the court. In Strawn v. AT & T Mobility LLC, 530 F.3d 293, 299 (4th Cir. 2008), the Fourth Circuit found the defendant’s showing sufficient to establish the amount in controversy under CAFA when the plaintiffs had “offered nothing” to challenge the accuracy of the defendant’s affidavit.

Against this backboard, the Court found that the defendants had executed their game plan to near perfection and that the court would adopt the defendants’ computation of the amount in controversy based on key assumptions supported by facts in the record.    More specifically, the defendants’ playbook demonstrated a conservative assumption of one-half of the putative class working only one hour of overtime per week and that the putative class members were paid on average 36 hours per week. Based on that conservative assumption, the defendants followed through and calculated the allegedly unpaid hours per week by taking the difference between 41 hours allegedly worked and 36 hours actually paid (i.e., 4 hours of allegedly unpaid straight time and 1 hour of allegedly unpaid overtime). Company payroll records established that the putative class members were paid on average less than 23 hours per week; thus, they worked 17 hours of allegedly unpaid straight time, plus the allegedly unpaid overtime. 

Thus, after considering the entire field of play, the Court concluded that using this actual data on hours paid, the total estimated amount in controversy rose over the rim to exceed the $5 million dollar requirement.