Anthony v. Small Tube Manufacturing Corp., No. 07-CV-0164-MJR, 2007 WL 2746847 (S.D. Ill. Sep 19, 2007).
It was a game-changing play when the plaintiffs in this mass tort action failed to offer any evidence in support of their motion to remand seeking application of CAFA’s home-state controversy exception. The chief official called a major penalty on the home team when it (1) relied on mere allegations that 2/3 of the proposed class members were citizens of Pennsylvania; and (2) claimed that the “primary defendant” was necessarily the single defendant with the largest alleged exposure in the case.
Team Anthony, representing the plaintiffs, was deep in its own territory. The quarterback dropped back and threw a long pass downfield hoping to score on claims of beryllium exposure against several vendors to a facility at which the plaintiffs worked over the course of thirty-five years. One of the defensive players, Cabot Manufacturing, read the pass with dead-on accuracy, intercepted and removed under CAFA. The official signaled the case was down in federal court. When the plaintiffs challenged the call on the field, the removing defendant and its teammate Tube Methods came off the bench and made their case to the official.
Clearly, Team Anthony’s offensive coordinator has not been studying enough film or reading enough CAFA Law Blog, because the result of this dispute is no surprise. The CAFA playbook calls for application of the “home-state controversy exception” and declination of jurisdiction if (1) more than two-thirds of the potential plaintiffs are citizens of the state in which the action was filed; and (2) the primary defendants are also citizens of that state.
The replay shows that Team Anthony stepped out of bounds in a couple of spots. First, the burden of proof of the home-state controversy exception to jurisdiction is on the party asserting application of the exception. The official acknowledged this was an area not yet determined by the Third Circuit, but found decisions from the Fifth, Seventh, Ninth and Eleventh Circuits persuasive.
Second, there was no evidence that the required two-thirds of the potential plaintiffs were Pennsylvania citizens. Citing old law in the Third Circuit holding that the citizenship of a party cannot be established with mere allegations, the official penalized Team Anthony for this misstep. This carelessness was costly for plaintiffs, as the official concluded it could deny the motion to remand on this basis alone.
However, continuing to analyze the play, the official ruled the “primary defendants” for CAFA purposes are those defendants who face direct liability in the instant action. Team Anthony’s protest that the “primary defendant” was one or more defendants with significant exposure from the litigation was rejected, in light of tort decisions that the primary defendant was not the one with the deepest pockets or the greatest culpability. Here, two of the four named defendants were not Pennsylvania citizens. So, the call went for the defendants on that front as well.
In the end, the official confirmed the case was down at the federal court (considered by many as defensive territory). Now, like the Philadelphia Eagles, Team Anthony has to be wondering if its quarterback is past his prime. How will this game end? Only the Vegas bookies know. But rest assured your CAFA Law Blog crew will break into regularly-scheduled programming with any important updates.