Yocupicio v. PAE Group , LLC; Arch Resources Group, LLC, 795 F.3d 1057 (9th Cir. 2015).

In Yocupicio, the plaintiff, an employee, brought an action in state court alleging various workplace violations and failure to meet minimum wage requirements. The plaintiff alleged ten causes of action, nine of which were brought as class claims. The tenth cause of action was brought as a representative claim under the California Labor Code Private Attorneys General Act of 2004 (“PAGA”).  

The amount sought pursuant to the class claims was $1,654,874, and the amount sought pursuant to the PAGA claim was $3,247,950, totalling $4,902,824. The Court assumed that reasonable attorney’s fees would bring the total recovery sought for all claims to at least $5,000,001.  The defendants removed the action on the basis of CAFA jurisdiction.  The District Court denied the plaintiff’s motion to remand and the plaintiff appealed to the Ninth Circuit.

Although the class claims would satisfy CAFA’s numerosity and minimal diversity requirements, the Ninth Circuit noted that those claims, taken singly or aggregated, did not meet the over $5,000,000 requirement.   The Court stated that because the PAGA claim was not brought as a class claim, it could not be deemed as one for the purpose of meeting the amount-in-controversy threshold.

The Court analysed the plain language of CAFA, determining that “in enacting CAFA, Congress was focused on class actions rather than on all representative actions or on cases where a class claim was only a part, perhaps a small part, or a civil action.” Accordingly, the Ninth Circuit disagreed with the district court’s consideration of all of plaintiff’s claims, not just her class claims, in determining whether CAFA jurisdiction was permissible.

The Ninth Circuit ultimately held that class claims alone must meet the amount-in-controversy requirement in order for federal jurisdiction to be invoked under CAFA and consequently reversed and remanded.

Posted by Amanda Laviage