Allen v. Novaquest LLC, No. 8:10-CV-1119-T-24EAJ, 2010 WL 2330330 (M.D. Fla. Jun 09, 2010).

While this case is not a CAFA case, we bring it to you because it is an example (for good or bad) of a CAFA decision being applied to a non CAFA case.

Michael Allen sued the defendants in the state court alleging discrimination pursuant to Fl. Stat. Ch. 760.  In his complaint, Allen demanded unspecified compensatory damages including back pay, front pay (or reinstatement) and benefits, damages for emotional distress, pain and suffering and mental anguish, punitive damages, pre and post judgment interest, attorneys’ fees, and costs.

The defendants removed the case to the federal court alleging diversity jurisdiction pursuant to 28 U.S.C. §1332(a)(1), and stating that the matter in controversy exceeded the sum or value of $75,000, exclusive of interest and costs. The defendant stated that when Allen was terminated, he earned an annual salary of $58,500 and received benefits including a monthly car allowance of $650.  Therefore, the defendants calculated that Allen’s alleged damages for loss of past earnings and the car allowance for the 14 months between his termination and the commencement of this action alone totaled $77,350.

Allen moved to remand arguing that the defendants failed to consider his mitigation of damages in their calculation of the amount in controversy. Allen claimed he had largely mitigated his damages because after his termination in March 2009, he obtained employment in May 2009 earning over $60,000 annual salary. 

The defendants contended that Allen’s motion must be denied because Allen failed to dispute the defendants’ affidavit setting forth the damages calculation other than back pay, as well as the fact that Allen also ignored the other damages claimed in his complaint.  

The District Court remarked that the defendants attempted–impermissibly–to shift their burden to Allen.  The Court maintained that under Lowery v. Alabama Power Co., 483 F.3d 1184, 1207 (11th Cir. 2007), the defendants being the removing parties, bore the burden of establishing the court’s jurisdiction.  (Editors’ Note: See the CAFA Law Blog analysis of Lowery posted on May 15, 2007).

Under Lowery, the jurisdictional amount must be stated clearly on the face of the documents before the court, or readily deducible from them; otherwise remand was appropriate. Although the defendants had addressed those aspects of Allen’s alleged damages that were relatively susceptible to calculation, Allen had offered evidence to refute those calculations.  And for the remaining claims–emotional distress, pain, suffering, and mental anguish– an estimation of damages was difficult.  

Accordingly, as the evidence was insufficient to establish the Court’s jurisdiction, by a preponderance of the evidence, and neither the defendants nor the Court may speculate as to whether such evidence exists, the Court remanded the action to state court.