Vanyo v. CitiFinancial, Inc., ____ F. 3d ____, 2007 WL 1795959, No. 1:06CV2943 (N.D. Ohio June 20, 2007).

Does size matter?  The eternal question every litigator ponders.  The question was answered in this case pending before the Northern District of Ohio.  CitiFinancial learned that providing evidence of the biggest class possible does not make for a better remand motion.

Plaintiff, William Vanyo (“Vanyo”), brought a putative class action against CitiFinancial in Cuyahoga County Court. (That is Cleveland for our readers who are geographically challenged.)  The complaint alleged that CitiFinancial failed to file a timely termination statement for a loan covering consumer goods that Vanyo had paid. Vanyo asserted that according to an Ohio statute, he was entitled to statutory damages of $500. 

The putative class included claimants who (1) had active financing statements with CitiFinancial, (2) covering consumer goods, (3) the loans for which had been paid off, but for which (4) CitiFinancial did not timely file a termination statement. CitiFinancial removed the case to the federal court for the Northern District of Ohio and Vanyo moved to remand.

The issue on remand was whether Vanyo alleged damages in excess of the statutory minimum of $5,000,000. The potential damages were $500 per claimant. The question was whether CitiFinancial proved that there were at least 10,000 potential claimants.

Before the court addressed the issue of exactly how many potential claimants there were, it briefly summarized prior cases addressing the burden of proof. The court acknowledged, and rejected, that some courts determined that CAFA provided for a shifting of the traditional burden from the removing party to the party seeking remand. This court agreed with prior decisions by the 6th Circuit and the Northern District of Ohio that under CAFA, the burden remained on the removing party to establish jurisdiction under CAFA. Citing, Hayes v. Equitable Energy Res. Co.; Pittman v. Chase Home Finance, LLC.

To meet its burden of proof, CitiFinancial provided an affidavit of the Ohio Secretary of State stating that there were 22,837 active financing statements in which CitiFinancial was named as the secured party. The Court held that CitiFinancial’s assessment of the class well exceeded the scope of the Ohio statute in question. CitiFinancial did not prove how many of the active financing statement were for consumer goods or for loans which had been paid, however. 

The court remanded the case back to Ohio county court. CitiFinancial learned that establishing the biggest class conceivable will not necessarily result in CAFA jurisdiction. Sometimes smaller (but still big enough) is better.