Only Concrete Evidence Can Keep A Defendant’s Case Afloat Under CAFA’S Legal Certainty Standard

Bell v. Home Depot U.S.A., Inc., 2013 WL 1791920 (E.D.Cal. April 26, 2013).

As amended by CAFA, 28 U.S.C. § 1332(d) vests district courts with original jurisdiction of any civil action in which the amount in controversy exceeds $5,000,000, the aggregate number of proposed plaintiffs is 100 or greater, and any member of the plaintiff class is a citizen of a state different from any defendant. But, if a class-action plaintiff stipulates, prior to certification of the class, that he, and the class he seeks to represent, will not seek damages that exceed $5,000,000 in total, does that stipulation remove the case from CAFA's scope? The District Court for the Eastern District of California certainly seems to suggest so.

In this case, the parties disputed which legal standard governed the amount in controversy determination. Under CAFA, "where the plaintiff has pled an amount in controversy less than $5,000,000, the party seeking removal must prove with legal certainty that CAFA's jurisdictional amount is met." Lowdermilk v. U.S. Bank Nat'l Ass'n., 479 F.3d 994, 1000 (9th Cir 2007). However, if a plaintiff's "complaint is unclear [regarding] 'a total amount in controversy,' the proper burden of proof . . . is proof by a preponderance of the evidence." Guglielmino v. McKee Foods Corp., 506 F.3d 696, 701 (9th Cir. 2007).

The plaintiffs, employees of Home Depot, brought an action in the Superior Court of the State of California alleging violations of California's wage and hour law. Plaintiffs sought to recover unpaid wages, unpaid overtime wages, statutory penalties, waiting time penalties, unreimbursed expenses, liquidated damages, restitution, injunctive relief, interest, attorneys' fees, and costs. Additionally, the plaintiffs' Complaint alleged that the monetary damages and restitution sought exceeded the minimal jurisdiction limits of the Superior Court and would be established according to proof at trial. The plaintiffs alleged that the amount in controversy for each class representative, including claims for monetary damages, restitution, penalties, injunctive relief, and a pro rata share of attorneys' fees, was less than $75,000 and that the aggregate amount in controversy for the proposed class action, including monetary damages, restitution, penalties, injunctive relief, and attorneys' fees, was less than $5,000,000, exclusive of interest and costs. Unsurprisingly, the plaintiffs reserved the right to seek a larger amount based upon new and...