Wright v. American Bankers Life Assurance Company of Florida, 586 F.Supp. 2d 464 (D.S.C. 2008)

“Hey Court, although this case was originally filed back in 2000 (5 years prior to CAFA), the plaintiffs have now amended their complaint to (1) add new parties, (2) assert new statutory violations and causes of action, and (3) rephrase their class definition. We would now like to remove under CAFA …”

“Not so fast my friend…”

This class action complaint was originally filed on April 12, 2000 in state court alleging that American Bankers Life Assurance Company of Florida (“ABLAC”) charged excessive rates for insurance policies in violation of the South Carolina Consumer Protection Act. The complaint petitioned the court to certify a class consisting of all similarly situated insurance consumers who had purchased the same policies from ABLAC.

As we here at CAFA Law Blog all well know, CAFA did not go into effect until that fateful day on February 18, 2005. We also know that CAFA does not apply retroactively to class actions commenced earlier than that date. However, there are certain circumstances through which a party can amend its complaint and effectively “recommence” his or her case allowing the case to be susceptible to federal jurisdiction under CAFA even though the original complaint was filed prior to its enactment.

The defendant in this case, attempted, through smoke and mirrors to do just this…but the court was not that stupid…

The defendant first argued that the plaintiffs had added new party plaintiffs to the action; therefore, the case should be considered to have been recommenced. Let’s see what really happened:   The plaintiffs simply elevated a class member to a class representative. Ha, try again…

The defendant also argued that the amended complaint added new causes of action and, thus, the case should be considered to have been recommenced. In reality, the plaintiffs amended their complaint to changed their allegation that the defendant violated § 37-4-203 generally, as opposed to violations of only § 37-4-203(5), which had previously asserted.   Newsflash: Amending a complaint to assert violations of additional subsections of the same South Carolina statute does not recommence an action. This is getting a little ridiculous …

Finally, in the amended complaint, the plaintiffs define the class as those who bought insurance policies from the defendant “from April 1, 1997 through December 31, 1999” as opposed to the definition in the original complaint which defined the class as those that purchased the insurance policies from the defendant “prior to January 1, 2000.” The Defendant argued that the class definition had been changed and they would be prejudiced by same. 

Really? 

The new proposed definition does not expand the class in any way as anyone who could qualify as a class member upon the definition given in the amended complaint would also qualify under the definition given in the original complaint. No additional claims have been raised, and no extra time or resources need to be expended by the defendants because of this new definition. Are they serious?

As you might have already guessed, the federal court remanded the case back to state court of South Carolina…