Monday, October 23, 2017
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Ninth Circuit Vacates Order Remanding Class Action to Superior Court
By a MetNews Staff Writer
The Ninth U.S. Circuit Court of Appeals held Friday that a case removed to federal court based on the Class Action Fairness Act cannot be remanded to state court based on the “home-state controversy exception” where it was only established that two-thirds of a portion of the class was comprised of citizens of California.
The putative action—on behalf of residents of California and Washington—was brought in San Diego Superior Court by Tiffany Brinkley against Monterey Financial Services Company which, she alleged, recorded or monitored telephone conversations with her without telling her in advance. She alleged invasion of privacy under the laws of both states, unlawful recording under California law, a violation of California’s unfair competition law.
Monterey removed the action to the U.S. District Court for the Southern District of California pursuant to the Class Action Fairness Act (“CAFA”) which creates diversity jurisdiction where the aggregate amount of the claims exceeds $3 million, any class member is a citizen of a state different from any defendant, and there are at least 100 class members.
Two-Thirds Requirement
In seeking a remand, Brinkley cited the “home-state controversy exception” which applies where “two-thirds or more of the members of all proposed plaintiff classes in the aggregate, and the primary defendants, are citizens of the State in which the action was originally filed.”
District Judge William Q. Hayes granted the motion. Reversal came in an opinion by Judge Milan D. Smith Jr., who wrote:
“In order to determine whether two-thirds of class members are California citizens, we must first determine the size of the class as a whole.…Here, Brinkley’s class consists of all individuals who made or received a telephone call with Monterey ‘while physically located or residing in California and Washington.’ By its terms, the class includes individuals who were physically located in, but were not residents of. California or Washington when they made or received a call with Monterey…”
Showing Not Adequate
He went on to say:
“A plaintiff cannot remand an otherwise valid CAFA case to state court when only a portion of the class meets the two-thirds citizenship requirement….This is what Brinkley seeks to do here—remand a class action based on evidence of only some class members’ citizenship….[T]here is no evidence regarding the citizenship of class members who made or received a phone call from Monterey while located in. but not residing in, California or Washington.”
“A plaintiff cannot remand an otherwise valid CAFA case to state court when only a portion of the class meets the two- thirds citizenship requirement….This is what Brinkley seeks to do here—remand a class action based on evidence of only some class members’ citizenship. The size of the entire class is unknown and Brinkley has failed to prove that two-thirds of class members are California citizens because there is no evidence regarding the citizenship of class members who made or received a phone call from Monterey while located in. but not residing in, California or Washington.”
The case is Brinkley v. Monterey Financial Services Company, No. 17-56335.
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