Rodgers v. Central Locating Service, Ltd., 412 F.Supp.2d 1171, No. 05-1911, 2006 WL 240683 (W.D. Wash. Feb. 1, 2006)
A federal district court in Washington recently rejected a defendant’s argument that the Class Action Fairness Act of 2005 shifts the burden of proof in a contested remand motion to the party resisting federal jurisdiction. This case constituted the third round of a wage and hour dispute between Central Locating Service (“CLS”) and its employees concerning the company’s overtime practices. After two class actions had been filed in federal court in Florida and Washington, allegedly aggrieved employees filed this case in Washington state court, seeking unpaid wages and overtime compensation under the Washington Minimum Wage Act, purposely omitting any claims under the federal Fair Labor Standards Act. CLS removed the case to the District Court for the Western District of Washington asserting federal jurisdiction under CAFA, and arguing that the amount in controversy exceeded $5 million.
However, before reaching the issue of amount in controversy, U. S. District Judge John C. Coughenour addressed CLS’s argument that CAFA altered the “traditional” presumptions and burdens under 28 U.S.C. Section 1332. CLS argued that CAFA “reversed the presumption against removal jurisdiction by requiring plaintiffs opposing removal to disprove the existence of jurisdictional prerequisites.” Judge Coughenour rejected CLS’s assertion that this modification of the traditional burden was evident from the textual amendments, and could find no “additions, admissions, or alterations demonstrating any Congressional intent to alter any of the long-standing presumptions or burdens applicable to remand motions.” Moreover, the judge was hesitant, and ultimately declined, to attempt to infer any intent from Congress’s silence on the issue.
In an attempt to persuade the court to look to CAFA’s legislative history, which strongly supported CLS’s position, CLS claimed that Congress’s silence on the issue amounted to an ambiguity on the face of the statute. However, the court wasn’t ready to make that leap, and instead, affirmatively found that Congress’s failure to address the burden of proof issue in the text of the statute did not amount to an ambiguity sufficient to warrant attempting to discern guidance from the legislative history. Judge Coughenour concluded that CAFA’s textual silence on this issue simply meant that Congress “left intact the well-founded presumption against removal jurisdiction.”
Judge Coughenour then addressed whether CAFA’s requisite $5 million amount in controversy was satisfied. In that regard, the court noted that both parties conceded there was already $4.1 million in damages on the table. The dispute centered around whether the employees’ request for injunctive relief would add at least another $876,000 to the jurisdictional amount. CLS contended that the request for injunctive relief applied to the plaintiffs’ cause of action for unpaid overtime pay and, as such, could potentially require CLS to disgorge the $876,000. The court, however, held that CLS failed to satisfy its burden of showing that the cost of compliance with an injunction would exceed $876,000, and that CLS has thus failed to demonstrate that CAFA’s $5 million amount in controversy requirement was fulfilled. Judge Coughenour accordingly granted the plaintiffs’ motion and remanded the case back to Washington state court.