Palisades Collections, LLC v. Shorts, No. 5:07-cv-098, 2008 WL 249083 (N.D.W.Va. Jan. 29, 2008).

Maybe AT&T should have been wearing boxing Shorts for this fight. It certainly was not prepared for the West Virginia butt-kicking it took!

What started out as a little cell phone collection matter turned into a street fight. AT&T determined one of its subscribers, Charlene “Shorts,” had defaulted on her contract and farmed the collection matter to Palisades Collections, LLC. Palisades subsequently filed suit in state court. However, Shorts answered, filed a countersuit, amended to join AT&T as an additional counterclaim defendant, and brought class claims. AT&T tried to remove, even though they were plaintiffs, but soon realized that them weren’t those Daisy Duke kinda shorts they were up against! Maybe they were just distracted by those hot pants!!

 In short, (or is that “In jort”) AT&T started out pumped! It argued that (1) as a “counterclaim” defendant it could seek removal, or alternatively (2) that CAFA provided an independent bases for removal. After rejecting AT&T’s argument that a counterclaim defendant could remove, the Court moved on to AT&T’s CAFA argument.

The Court found that the claim did meet the CAFA requirements, but rejected AT&T’s argument that CAFA provided an independent basis for removal, separate and apart from 28 USC § 1441.

In essence, AT&T alleged that the phrase “such action may be removed by any defendant” in §1453 showed an intention by congress to broaden the category of defendants who could remove under CAFA. Relying on decisions in prior cases such as Ciitifinancial v. Lightner and Ford Motor Credit Co. v. Jones, the Court reasoned that prior jurisprudence interpreting removal under §1441 applies to removal under CAFA. (Editors’ Note:  See the CAFA Law Blog analysis of CitiFinancial Inc. v. Lightner posted on November 7, 2007 and the CAFA Law Blog analysis of Ford Motor Credit Co. v. Jones posted on January 23, 2008).

We at the CAFA Law  Blog are still a bit hazy on the direction that this one will take. For instance, one would guess you could say that the Court decided that the language in the removal statute just wasn’t loose enough to drag Shorts into federal court. Or maybe it the ruling was that CAFA just wasn’t a big enough wedge to provide any room in the tight “shorts” of federal removal!  (Based on these pictures, you decide).

At the end, AT&T’s bid for removal was rejected, it was sent back to state court, and left federal court a little hot in the shorts!