Roberts v. Tribeca Automotive, Inc., 2019 WL 522127 (D.N.J. February 11, 2019)
In this action, the District Court of New Jersey adopted a magistrate’s recommendation which granted the plaintiff’s motion to remand the case back to state court. The plaintiff brought a class action in a state court of New Jersey seeking to recover wages for a class of employees of defendant (which was an interstate trucking company) who were allegedly misclassified as independent contractors. The defendant removed the action asserting that the District Court had jurisdiction pursuant to the Class Action Fairness Act (“CAFA”). The plaintiff thereafter filed a motion to remand. The magistrate judge recommended remand, concluding that the defendant had failed to prove that the plaintiff could recover the requisite amount in controversy for CAFA jurisdiction (five million dollars). In addition, the magistrate judge recommended remand pursuant to CAFA’s discretionary home state exception. The defendant thereafter filed objections to the magistrate judge’s recommendations.
Regarding the jurisdictional amount in controversy, the defendant argued that the plaintiff’s estimation of $5,752,515.51 in damages (which was made in response to a state civil procedure rule requiring him to provide an estimation of damages in response to a demand made by the defendant) made it clear beyond a legal certainty that the plaintiff was seeking damages in excess of the CAFA minimum. As it relates to the CAFA home state discretionary exception, the defendant argued that the Court should not invoke the exception because the matter involved interstate trucking – which is an area of law which federal courts generally assert jurisdiction.
The District Court rejected both of these arguments. First, the Court found that the defendant had failed to meet its burden of establishing the amount in controversy requirement under CAFA by relying solely on the plaintiff’s response to a request for a statement of damages from the defendant. The Court noted that the plaintiff’s complaint did not seek a specific amount of monetary damages. Moreover, the plaintiff’s response letter to the defendant had expressly stated that the amount was only an estimate and did not include any further information or analysis. The Court therefore held that it did not have jurisdiction over the matter based on CAFA’s amount in controversy requirement.
The Court then turned to CAFA’s home state discretionary exception. The defendant argued that, although it was a New Jersey corporation and that between one-third and two-thirds of the class members were citizens of New Jersey, the outcome of the case would impact other interstate carriers, ocean shipping, port administration, and foreign and interstate commerce in general. The Court balanced this argument against the six factors included in 28 U.S.C. § 1332(d)(3) and found that the matter was uniquely local. First, the asserted claims involved violations of the New Jersey Wage and Hour Law and the New Jersey Wage and Payment Law. Further, the plaintiff had sought recourse for alleged violations committed by a New Jersey employer, and did not assert any other state or federal violations. Although some class members might have crossed state lines while performing their job duties, the plaintiff’s claims arose from employment with a New Jersey employer whose primary place of business was located in New Jersey. The class members worked out of the defendant’s New Jersey facility and a majority of them were citizens of New Jersey. Lastly, there were no other class actions asserting the same or similar claims on behalf of class members. In fact, of the six factors included in 28 U.S.C. § 1332(d)(3), only one (subsection (C): “whether the class action has been pleaded in a manner that seeks to avoid Federal jurisdiction”) favored removal. The other five factors supported remand.
The Court thus concluded that, even if CAFA jurisdiction did exist, it would still be obligated to remand the matter to the state court of New Jersey in the interests of justice. Accordingly, the Court adopted the magistrate’s recommendation which granted the plaintiff’s motion to remand.