Weber ex rel Estate of Ruble v. Mobil Oil Corp., No. 06-6337, 2007 WL 3317680 (10th Cir. Nov. 9, 2007).
The defendants must have felt like Sam Drucker’s pig and the plaintiffs must have felt Lisa Douglas when this decision was handed down. This case began in May 2001 when J.C. Dobbins, filed a class action petition in an Oklahoma state court against Mobil Oil Corporation, Inc. (whose name was subsequently changed to ExxonMobil Oil Corporation) and Mobil Exploration & Producing, North America on behalf of owners of a royalty interest in the oil and gas underlying Oklahoma land where ExxonMobil Oil Corporation operates oil and gas wells. The class sought damages for a variety of causes of action and also sought an accounting and constructive trust.
Three years later in October 2004, Colleen Mannering and two other parties, all of whom were part of the class in the state court action, filed a similar class action in federal court against the same two defendants. Their class also included royalty interest owners of oil and gas in the same Oklahoma land, but the class was more broadly defined. In addition to the various causes of action alleged in the state suit, the federal suit also sought additional damages, a declaratory judgment and a resulting trust.
In December 2004, the state court class amended its petition to add Mobil Exploration & Producing, US (“MEPUS”) and Mobil Natural Gas, Inc. (“MNGI”) to the suit.
In September 2005, the federal and state plaintiffs came to an agreement which led to the federal plaintiffs voluntarily dismissing their complaint and intervening in the state court action. MEPUS and MNGI removed the case to the Western District of Oklahoma asserting federal jurisdiction under CAFA. The plaintiffs argued that CAFA did not apply and moved to remand the case to state court. The district court agreed with the plaintiffs and remanded the case. MEPUS and MNGI then filed a petition with the 10th Circuit for leave to appeal the district court’s remand order.
Normally, a remand order is not reviewable. However, in this case, MEPUS and MNGI filed their petition for leave to appeal under 28 USC § 1453(c)(1), a CAFA provision that provides federal appellate courts with discretionary jurisdiction to consider appeals of remand orders in certain types of class actions.
CAFA applies “to any civil action commenced on or after the date of enactment of this Act.” Therefore, the court was faced with the task of determining whether this case began on or after the effective date of CAFA so that the court could assert jurisdiction over the case under 28 USC § 1453(c)(1).
CAFA was enacted on February 18, 2005. Unfortunately for the defendants, this case began long before that when the case was originally filed 2001 in an Oklahoma state court. However, the federal plaintiffs did not intervene in the suit until September 2005, months after CAFA’s enactment. Therefore, MEPUS and MNGI argued that the federal plaintiffs’ intervention “commenced” a new action.
The defendants relied heavily on the 10th Circuit’s decision in Prime Care of Northeast Kansa, LLC v. Humana Ins. Co. to support their position. (Editors’ Note: See the CAFA Law Blog analysis of Prime Care posted on August 16, 2006).
In that case, the court addressed whether CAFA permits the removal of a class action filed before CAFA’s effective date if the removing defendant was first added by amendment after the effective date. The court held that “whether a post-CAFA amendment triggers a substantive right of removal under CAFA depends on whether the amendment relates back to the pre-CAFA pleading that is being amended.” In essence, if the amendment relates back, then the commencement date is the date of the original filing of the action despite the amendment; but if the amendment does not relate back, then the action commences at the time of the amendment. The defendants argued that a petition in intervention never relates back to the original complaint, which would mean that under Prime Care, the action commenced when the new plaintiffs intervened, which was after the enactment of CAFA.
Nice try Mobil! But the court disagreed with this argument for several reasons. First, it found that Prime Care was not controlling because the plaintiffs hadn’t amended the pleadings. Second, the defendants “painted with too broad a brush” by asserting that a petition in intervention never relates back to the filing of the original complaint. According to the court, “even if an intervening plaintiff always commences a new action for purposes of the statute of limitations . . . we see no reason why such a rule leads inevitably to the conclusion that an intervening plaintiff commences a new action for purposes of a newly enacted statute expanding federal subject matter jurisdiction such as CAFA.” Finally, no authority exists to suggest that intervening plaintiffs asserting identical causes of action against the same defendants as named in the original complaint change the commencement date of the suit for purposes of CAFA. In fact, case law supports the opposite conclusion.
In the end, the 10th Circuit found that the action began with the filing of the original pleading in May 2001, before CAFA’s effective date, and the petition for intervention did not alter this date. Therefore, 28 USC § 1453(c)(1) of CAFA did not provide the court with jurisdiction to hear the defendants’ appeal of the remand order. As a result, the court denied the defendant’s petition for review.