Morey v. Louis Vuitton N. America, Inc., 2011 WL 6256963 (9th Cir. Dec. 15, 2011).
Want a chic Louis Vuitton bag for free on Valentine’s Day? Want to know how to get one? Try to buy one and hope the clerk asks you for your zip code…at least if you are in California.
While reversing the district court’s remand order, the Ninth Circuit held that California Song–Beverly Act does not limit the recoverable penalty to $250 for the defendant’s first violation against each separate victim; rather, it caps the penalty at $250 for the defendant’s first violation, and then at $1,000 for each ‘subsequent violation’, regardless of whether the defendant’s subsequent violation aggrieved the same victim as the first violation.
The plaintiff, Deanna Morey, brought a putative class action in state court alleging that the defendant, Louis Vuitton North America, Inc., violated California’s Song–Beverly Credit Card Act, Cal. Civ.Code § 1747.08, by requesting and recording shoppers’ personal identification information when they used a credit card for purchases at Louis Vuitton retail stores.
Louis Vuitton filed a notice of removal in the District Court asserting jurisdiction under CAFA.
The district court remanded the action to state court holding that Louis Vuitton’s initial notice of removal failed to show by a preponderance of the evidence that the amount in controversy exceeded $5 million.
Louis Vuitton appealed the district court’s remand order, and the Ninth Circuit reversed that order.
The Ninth Circuit noted that when determining the amount in controversy for jurisdictional purposes, the amount claimed in the complaint’s prayer for relief controls if apparently made in good faith.
Here, the complaint sought penalties of “up to … $1,000 per violation” of the Song–Beverly Act. Cal. Civ. Code § 1747.08(e) gives the court discretion to impose civil penalties not to exceed $250 for the first violation and $1,000 for each subsequent violation. The statute’s language does not necessarily limit the recoverable penalty to $250 for the defendant’s first violation against each separate victim. Rather, the statutory language caps the penalty at $250 for the defendant’s first violation, and then at $1,000 for each subsequent violation, regardless of whether the defendant’s subsequent violation aggrieved the same victim as the first violation.
Because the amount in controversy could be as much as $1,000 for each subsequent violation, and it was undisputed that there were “substantially in excess” of 5,000 credit card transactions, the Ninth Circuit concluded that the preponderance of the evidence showed that the amount in controversy exceeded $5 million.
Accordingly, the Ninth Circuit reversed the district court’s remand order. Obviously, there was a blue bird on Louis Vuitton’s shoulder.