Bertino v. General Motors Corp., Civ. 05-10008-GPM, 2006 WL 2818773 (S.D. Ill. Sep. 27, 2006), associated with In re: General Motors Corporation Dex-Cool Products Liability Litigation, No. MDL-03-1562-GPM.
There is something comforting about the classics, so here we go spinning another Chuck Berry classic to analyze litigation connected with the GM Dex-Cool Products Liability Litigation on its continuing road trip, this time getting its kicks on Route 66 (well, almost). In Bertino v. General Motors Corp., the plaintiffs filed their putative class action case in San Joaquin County, California on February 17, 2005, a day before the effective date of the Class Action Fairness Act. They later filed an amended complaint on March 31, 2005, adding a new individual as proposed class representative.
GM did not plan to motor west. Instead, GM removed the case to federal court based on CAFA’s diversity jurisdiction provisions and the theory that the motion for leave to add a new party plaintiff re-commenced the lawsuit after the effective date of CAFA. Shortly thereafter, the case motored east when the MDL panel transferred the case to the Southern District of Illinois. Upon consideration of GM’s arguments against the plaintiffs’ motion to remand, Judge Murphy-likely experiencing déjà vu (Editors’ Note: See the CAFA Law Blog the analysis of Judge Murphy’s decision in Natale v. General Motors posted on April 26, 2006 and the analysis of the Seventh Circuit’s decision in Natale v. General Motors posted on August 14, 2006)-said no again to GM’s efforts to park in federal court.
The court rejected GM’s bid to cast its removal of the initial plaintiffs’ claims as an invocation of the court’s supplemental jurisdiction. Citing Knudsen v. Liberty Mut. Ins. Co.: “The accepted test of whether an amendment of a class-action complaint after the effective date of CAFA ‘commences’ the action so as to permit removal under the statute is whether the amendment ‘relates back’ to the filing date of the original complaint: if it does, then the case is not removable, but if it does not, the case is subject to removal under CAFA.” (Editors’ Note: See the CAFA Law Blog analysis of Knudsen II posted on January 30, 2006.) (Editors’ Note: If you really love the law and enjoy reading how a case travels the winding highway of legal opinions, then you may be interested in the CAFA Law Blog analysis of Knudsen I posted on September 3, 2005 and the CAFA Law Blog analysis of the December District Court decision in Knudsen posted on January 5, 2006 which lead to Knudsen II).
Judge Murphy concluded that the amendment of the complaint to join the new plaintiff related back to the filing of the original complaint under California state law, because it rested on the same facts underlying the original complaint, involved the same injury alleged in the original complaint, imposed no legal obligation upon GM distinct from that sought to be imposed in the original complaint, added no new claims for relief, and did not alter the scope of the proposed class. This “routine” amendment did not commence this action after the effective date of CAFA so as to make it removable under the statute.
The court, fastening its safety belt for the trip down the highway that’s the best, also analyzed the relation back issue under federal law, concluding the result would be the same. Because the amended complaint claims arose out of the conduct, transaction or occurrence set forth or attempted to be set forth in the original pleading, adding a new party plaintiff did not commence the action-the amendment related back.
The court took a quick pit stop to consider an issue not briefed by either side: whether the plaintiff’s motion for leave to amend a new defendant, filed after the effective date of CAFA, could support federal jurisdiction. The notice of removal did not mention the addition of a new defendant as a grounds for federal jurisdiction. The court concluded the notice of removal could not be amended to add this additional basis for jurisdiction more than thirty days after it became available. So, the court concluded the motion for leave to amend to add the new defendant could not support federal jurisdiction under CAFA.
Finally, in one last detour before getting on the road from the East St. Louis, the court addressed whether diversity jurisdiction existed under pre-CAFA law. Complete diversity of citizenship existed and was not contested. The amount in controversy was the sticky issue. The claims of each putative class member concerned allegedly defective intake manifold gaskets and were not considered to be of high value on an individual basis. The court reviewed the rationale for the existence of the class action as a device for consolidating many small claims into one that would be worth an attorney’s time and effort to prosecute. The court rejected GM’s invocation of the “so-called ‘either viewpoint’ rule,” which values equitable relief for purposes of the jurisdictional amount either by the value of the relief to a plaintiff or its cost to a defendant, because of the large size of the putative class. The court also “considered as misplaced” GM’s reliance on a 5th Circuit’s decision that attorney fees recoverable by putative class members could be considered in determining the amount in controversy, stating that the 7th Circuit standard called for inclusion only of attorney fees incurred before the removal in determining whether the requisite amount was in controversy.
With that, Judge Murphy–essentially telling GM to get hip to his timely tip– waved the green flag for the two thousand mile trip and told the Bertino case to “Hit the road Jack!” Wait a second…that’s not Chuck Berry.