Washington State, et al v. Chimei Innolux Corp., et al
FILED OPINION (SIDNEY R. THOMAS, N. RANDY SMITH and SOLOMON OLIVER, JR.) AFFIRMED. Judge: SRT Authoring, FILED AND ENTERED JUDGMENT. 
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OCT 03 2011
UNITED STATES COURT OF APPEALS
MOLLY C. DWYER, CLERK
U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
WASHINGTON STATE; THE PEOPLE
OF THE STATE OF CALIFORNIA, ex
rel. Kamala D. Harris, Attorney General of
the State of California, as parens patriae on
behalf of natural persons residing in the
state; THE STATE OF CALIFORNIA;
ALAMEDA COUNTY; CITY OF LONG
BEACH; CITY OF LOS ANGELES;
CITY OF OAKLAND; CITY OF SAN
DIEGO; CITY AND COUNTY OF SAN
FRANCISCO; CITY OF SAN JOSE;
CONTRA COSTA COUNTY; CORONANORCO UNIFIED SCHOOL DISTRICT;
ELK GROVE UNIFIED SCHOOL
DISTRICT; FRESNO COUNTY;
FRESNO UNIFIED SCHOOL DISTRICT;
GARDEN GROVE UNIFIED SCHOOL
DISTRICT; KERN COUNTY; LOS
ANGELES COUNTY; LOS ANGELES
UNIFIED SCHOOL DISTRICT;
OAKLAND UNIFIED SCHOOL
DISTRICT; ORANGE COUNTY;
SACRAMENTO COUNTY; SAN DIEGO
CITY UNIFIED SCHOOL DISTRICT;
SAN FRANCISCO UNIFIED SCHOOL
DISTRICT; SAN JOAQUIN COUNTY;
SAN JUAN UNIFIED SCHOOL
DISTRICT; SAN MATEO COUNTY;
SANTA CLARA COUNTY; SANTA
BARBARA COUNTY; SONOMA
COUNTY; SWEETWATER UNION
HIGH SCHOOL DISTRICT; TULARE
COUNTY; VENTURA COUNTY; THE
REGENTS OF THE UNIVERSITY OF
Plaintiffs - Appellees,
CHIMEI INNOLUX CORP.; CHI MEI
OPTOELECTRONICS USA, INC.; CMO
JAPAN CO., LTD.; EPSON IMAGING
DEVICES CORPORATION; HITACHI,
LTD.; HITACHI DISPLAYS, LTD.;
HITACHI ELECTRONICS DEVICES
(USA), INC.; SAMSUNG
ELECTRONICS CO., LTD.; SAMSUNG
SEMICONDUCTOR, INC.; SAMSUNG
ELECTRONICS AMERICA, INC.;
SHARP CORPORATION; SHARP
TOSHIBA CORPORATION; TOSHIBA
COMPONENTS, INC.; TOSHIBA
AMERICA INFORMATION SYSTEMS,
INC.; TOSHIBA MOBILE DISPLAY
TECHNOLOGY CO., LTD., FKA
Toshiba Matsushita Display Technology
Co., Ltd.; EPSON ELECTRONICS
Defendants - Appellants.
Appeal from the United States District Court
for the Northern District of California
Susan Illston, District Judge, Presiding
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Argued and Submitted September 13, 2011
San Francisco, California
Before: THOMAS and N.R. SMITH, Circuit Judges, and OLIVER, Chief District
Opinion by Judge Sidney R. Thomas
THOMAS, Circuit Judge:
This appeal presents the question, inter alia, of whether parens patriae
actions filed by state Attorneys General constitute class actions within the meaning
of the Class Action Fairness Act of 2005 (“CAFA”), Pub. L. No. 109–2, 119 Stat.
4 (codified at 28 U.S.C. §§ 1332(d), 1453, 1711–15). We conclude that they do
not, and we affirm the remand order entered by the district court.
The Attorneys General of Washington and California filed parens patriae
actions in their states’ courts alleging that Defendants engaged in a conspiracy to
fix the prices of thin-film transistor liquid crystal display (“TFT-LCD”) panels, and
that state agencies and consumers were injured by paying inflated prices for
products containing TFT-LCD panels.
The Honorable Solomon Oliver, Jr., Chief District Judge for the U.S.
District Court for Northern Ohio, Cleveland, sitting by designation.
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The complaints allege that between 1998 and 2006, Defendants engaged in
an international conspiracy to fix the prices of TFT-LCD panels in violation of
state antitrust laws, which resulted in higher prices for state agencies and citizens
purchasing products containing TFT-LCD panels.1
The Attorney General of Washington, in the name of the state and as parens
patriae on behalf of state citizens, filed an antitrust lawsuit against Defendants in
state court. The Attorney General’s complaint in this litigation alleges violations
of the Act and seeks: (1) declaratory and injunctive relief; (2) civil penalties; (3)
and damages and restitution “to the State of Washington on behalf of its state
agencies and consumers.” The consumers are Washington residents who
purchased finished products, such as televisions and cell phones, containing TFTLCD panels.
The Attorney General of California filed a similar complaint in state court,
as parens patriae on behalf of California residents. The California Attorney
General’s complaint alleges statutory violations and unjust enrichment and seeks:
(1) declaratory and injunctive relief; (2) civil penalties; and (3) restitution and
Class actions asserting the same price-fixing claims against the same
Defendants had been filed as early as 2006. Those actions were consolidated in
April 2007 as Multi-District Litigation No. 1827 in the Northern District of
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treble damages for state agencies, municipalities, and California residents who
purchased finished products containing TFT-LCD panels.
Defendants removed the California action to the United States District Court
for the Northern District of California and the Washington action to the United
States District Court for the Western District of Washington, alleging federal
jurisdiction under CAFA. Specifically, Defendants alleged that consumers were
the real parties in interest for the monetary relief claims, and that therefore the
States’ parens patriae claims were disguised class actions removable under CAFA.
Both California and Washington moved to remand to their respective state
courts, contending that removal under CAFA was improper. The district court
granted both States’ motions to remand. This timely appeal followed.
We review the question of whether these actions were properly remanded to
the State courts from which they were removed de novo. Patel v. Del Taco, Inc.,
446 F.3d 996, 998 (9th Cir. 2006); Providence Health Plan v. McDowell, 385 F.3d
1168, 1171 (9th Cir. 2004). Similarly, we review the “construction, interpretation,
or applicability” of CAFA de novo. Bush v. Cheaptickets, Inc., 425 F.3d 683, 686
(9th Cir. 2005).
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A federal court has jurisdiction over a civil case initiated in state court and
removed by the defendant to federal district court if the case originally could have
been brought in federal court. See 28 U.S.C. § 1441; Martin v. Franklin Capital
Corp., 546 U.S. 132, 134 (2005).
Congress enacted CAFA to “‘curb perceived abuses of the class action
device which, in the view of CAFA's proponents, had often been used to litigate
multi-state or even national class actions in state courts.’” United Steel v. Shell Oil
Co., 602 F.3d 1087, 1090 (9th Cir. 2010) (quoting Tanoh v. Dow Chem. Co., 561
F.3d 945, 952 (9th Cir. 2009)). CAFA vests a district court with original
jurisdiction over “a class action” where: (1) there are one-hundred or more putative
class members; (2) at least one class member is a citizen of a state different from
the state of any defendant; and (3) the aggregated amount in controversy exceeds
$5 million, exclusive of costs and interest. 28 U.S.C. § 1332(d)(2), (5)(B), (6).
CAFA authorizes the removal of class action lawsuits from state to federal
court when the jurisdictional requirements are satisfied. 28 U.S.C. § 1332(d)(2).
However, the general principles of removal jurisdiction apply in CAFA cases. The
right of removal is statutory, and the requirements strictly construed. Abrego
Abrego v. The Dow Chem. Co., 443 F.3d 676, 685 (9th Cir. 2006). The burden of
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establishing removal jurisdiction, even in CAFA cases, lies with the defendant
seeking removal. Id. at 686.
In applying these principles, the district court correctly concluded that
parens patriae suits filed by state Attorneys General may not be removed to
federal court because the suits are not “class actions” within the plain meaning of
CAFA. Accordingly, the district court properly remanded the actions.
The doctrine of parens patriae allows a sovereign to bring suit on behalf of
its citizens when the sovereign alleges injury to a sufficiently substantial segment
of its population, articulates an interest apart from the interests of particular private
parties, and expresses a quasi-sovereign interest. Alfred L. Snapp & Son, Inc. v.
Puerto Rico, 458 U.S. 592, 607 (1982). Relevant to this action, the Washington
Consumer Protection Act authorizes the Attorney General to file a suit “as parens
patriae on behalf of persons residing in the State” to “prevent the doing of any act
herein prohibited or declared to be unlawful.” Wash. Rev. Code § 19.86.080(1).
Similarly, California law empowers the Attorney General power to file a suit as
parens patriae to “secure monetary relief. . . for injury sustained by those natural
persons to their property by reason of any violation of this chapter.” Cal. Bus. &
Prof. Code § 16760(a)(1); see also Cal. Bus. & Prof. Code § 17204.
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The question of whether these parens patriae lawsuits are class actions
within the meaning of CAFA is one of statutory construction. As always, our
starting point is the plain language of the statute. Children's Hosp. & Health Ctr.
v. Belshe, 188 F.3d 1090, 1096 (9th Cir. 1999). “[W]e examine not only the
specific provision at issue, but also the structure of the statute as a whole, including
its object and policy.” Id. If the plain meaning of the statute is unambiguous, that
meaning is controlling and we need not examine legislative history as an aid to
interpretation unless “the legislative history clearly indicates that Congress meant
something other than what it said.” Carson Harbor Village, Ltd. v. Unocal Corp.,
270 F.3d 863, 877 (9th Cir. 2001) (en banc). If the statutory language is
ambiguous, then we consult legislative history. United States v. Daas, 198 F.3d
1167, 1174 (9th Cir. 1999).
There is no ambiguity in CAFA’s definition of class action. CAFA defines
the term class action as “any civil action filed under rule 23 of the Federal Rules of
Civil Procedure or similar State statute or rule of judicial procedure authorizing an
action to be brought by 1 or more representative persons as a class action.” 28
U.S.C. § 1332(d)(1)(B) (emphasis added). Under this definition, a suit commenced
in state court is not a class action unless it is brought under a state statute or rule
similar to Rule 23 that authorizes an action “as a class action.” Id.
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Neither lawsuit was filed under Rule 23 of the Federal Rules of Civil
Procedure or any similar state statute. Unlike private litigants, the Attorneys
General have statutory authority to sue in parens patriae and need not demonstrate
standing through a representative injury nor obtain certification of a class in order
to recover on behalf of individuals. See Wash. Rev. Code § 19.86.080; Cal. Bus. &
Prof. Code § 16760. None of the state statutes contain the typical class action
requirements of showing numerosity, commonality, typicality, or adequacy of
representation. See Marlo v. United Parcel Serv., Inc., 639 F.3d 942, 946 (9th Cir.
2011) (“To maintain a class action, a plaintiff must demonstrate numerosity,
commonality, typicality, and adequate representation of the class interest.”). As
the California Supreme Court noted:
an action by the People lacks the fundamental attributes of a consumer
class action filed by a private party. The Attorney General or other
governmental official who files the action is ordinarily not a member
of the class, his role as a protector of the public may be inconsistent
with the welfare of the class so that he could not adequately protect
their interests and the claims and defenses are not typical of the class.
People v. Pacific Land Research Co., 569 P.2d 125, 129 (Cal. 1977) (citations and
As the California Supreme Court also noted, a statutory parens patriae
action may well result in a settlement that does not include restitution to victims of
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the fraud, but only results in penalties paid to the public treasury. Id. at n.6. This
fact highlights the great distinction between a parens patriae lawsuit and a true
Put another way, class actions are always representative actions, but
representative actions are not necessarily class actions. Indeed, the Supreme Court
has held that other representative suits are not class actions. See Gen. Tel. Co. v.
EEOC, 446 U.S. 318, 333-34 & n.16 (1980) (“We hold . . . that the EEOC may
maintain its § 706 civil actions for the enforcement of Title VII and may seek
specific relief for a group of aggrieved individuals without first obtaining class
certification . . . .”). The question under CAFA is whether the state statute
authorizes the suit “as a class action.” The state statutes at issue here do not.
In reaching the conclusion that parens patriae lawsuits are not class actions
within the meaning of CAFA, we join the Fourth Circuit–the only other circuit
court to have squarely considered the question. West Virginia ex rel. McGraw v.
CVS Pharm., Inc., 646 F.3d 169 (4th Cir. 2011). In CVS Pharmacy, the West
Virginia AG brought suit against five pharmacies alleging that they sold generic
drugs to in-state consumers without passing along the cost savings, in violation of
three state statutes. Id. at 171-72. The court identified the four requirements of
Rule 23, and concluded that “while a ‘similar’ state statute or rule need not contain
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all of the other conditions and administrative aspects of Rule 23, it must, at a
minimum, provide a procedure by which a member of a class whose claim is
typical of all members of the class can bring an action not only on his own behalf
but also on behalf of all others in the class . . . .” Id. at 175. Because the state
statutes did not require the AG to be designated as a representative member of the
class and did not contain any numerosity, commonality, or typicality requirements,
the Fourth Circuit held that the action was not covered by CAFA. Id. at 176.2
For all these reasons, we conclude that the the statutory parens patriae
lawsuits before us are not class actions within the meaning of CAFA, and that the
district court properly remanded the actions to state court.
The Fifth Circuit’s decision in In re Katrina Canal Litig. Breaches, 524
F.3d 700 (5th Cir. 2008) is not to the contrary. In Katrina, the Louisiana Attorney
General filed a lawsuit, not under a parens patriae statute, but under the general
state class action statute, Louisiana Code of Civil Procedure, Article 591, which
contains requirements similar to Fed. R. Civ. P. 23. Id. at 703. Under those
circumstances, the Fifth Circuit concluded that the suit was removable under
CAFA. Id. at 706. The Fifth Circuit did not reach the question of whether
statutory parens patriae lawsuits were class actions under CAFA and, in fact, in a
subsequent case specifically noted that issue had not been decided. See Louisiana
ex rel. Caldwell v. Allstate Ins. Co., 536 F.3d 418, 430 (5th Cir. 2008) (“[W]e need
not address whether this lawsuit could . . . properly proceed as a class action under
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Defendants contend that the States’ parens patriae suits are class actions
within the meaning of CAFA because they are representative actions with
sufficient “similarity” to a class action under Rule 23. They cite the Senate
Judiciary Committee’s instructions to interpret the definition of class action
“liberally” under CAFA: “[i]ts application should not be confined solely to
lawsuits that are labeled ‘class actions’ by the named plaintiff or the state
rulemaking authority.” S. Rep. No. 109-14, at 34 (2005), reprinted in 2005
U.S.C.C.A.N. 3, 30.
Defendants’ argument, however, disregards the second part of the statutory
text defining class actions within the meaning of CAFA. A state action must be
filed under a statute that is both “similar” to Rule 23 and authorizes an action “as a
class action.” 28 U.S.C. § 1332(d)(1). Had Congress intended CAFA to apply to
any representative actions demonstrating sufficient similarity to class actions under
Rule 23, it would not have also included an explicit requirement that the suit be
brought “as a class action.” See TRW Inc. v. Andrews, 534 U.S. 19, 31 (2001) (“It
is a cardinal principle of statutory construction that a statute ought, upon the whole,
be so construed that, if it can be prevented, no clause, sentence, or word shall be
superfluous, void, or insignificant.” (internal quotation marks and citation
omitted)). Although a comparison to the requirements for class certification under
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Rule 23 can be useful in determining whether parens patriae suits are similar to
federal class actions, it is not the end of the inquiry.
Defendants suggestion that the Senate’s “explicit legislative guidance” to
define class action “liberally” requires viewing parens patriae claims as class
actions under CAFA is also unpersuasive. Even under an expansive definition,
CAFA would not cover parens patriae suits. As we have noted, it is not only that
parens patriae suits are not “labeled ‘class actions,’” it is that they also lack
statutory requirements for numerosity, commonality, typicality, or adequacy of
representation that would make them sufficiently “similar” to actions brought
under Rule 23, and that they do not contain certification procedures. Parens
patriae suits lack the defining attributes of true class actions. As such, they only
“resemble” class actions in the sense that they are representative suits.3
Defendants argue that even if the States’ statutes do not contain typicality
and adequacy of representation requirements, they do contain other procedural
Furthermore, the Senate Report contains a statement implying that CAFA
only applies to suits filed under a state’s Rule 23 analog, which contradicts the
Report’s later statement that CAFA applies to all lawsuits that simply resemble
class actions. S. Rep. No. 109-14, at 29, reprinted in 2005 U.S.C.C.A.N. 3, 24.
(“[CAFA] defines the term ‘class action’ to include representative actions filed in
federal district court under Rule 23 of the Federal Rules of Civil Procedure, as well
as actions filed under similar rules in state courts that have been removed to
federal court.” (emphasis added)).
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requirements such as notice to the affected citizens, opt-out provisions, and courtapproval for any settlements.4 According to Defendants, these procedural
requirements make parens patriae actions sufficiently similar to class actions.
However, this argument ignores CAFA’s requirement that the state statute
authorize the suit “as a class action” and the central requirements of class actions.
Under the plain text of 28 U.S.C. § 1332(d), the parens patriae suits are not
class actions within the meaning of CAFA. Therefore, the district court lacked
jurisdiction over the actions and properly remanded them to state court. Given this
conclusion, we need not, and do not, reach any other issue raised by the party.
Although California’s state statute includes these types of provisions, see
Cal. Bus. & Prof. Code § 16760(b)-(c), Washington’s does not, see Wash. Rev.
Code § 19.86.080.
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John M. Grenfell and Jacob R. Sorenson; Pillsbury Winthrop Shaw Pittman LLP;
San Francisco, CA; attorneys for appellant Sharp Corporation.
Christopher B. Hockett and Neal A. Potischman; Davis Polk & Wardwell LLP;
Menlo Park; CA; attorneys for appellant Chimei Innolux Corporation, Chi Mei
Optoelectronics USA, Inc., and CMO Japan Co., Ltd.
Melvin R. Goldman, Stephen P. Freccero, Derek F. Foran; Morrison & Foerster
LLP; San Francisco, California; attorneys for appellant Epson Imaging Devices
Corp. and Epson Electronics America, Inc.
Kent M. Roger and Herman J. Hoying; Morgan, Lewis & Bockius LLP; San
Francisco, California; attorneys for appellants Hitachi, Ltd., Hitachi Displays, Ltd.,
and Hitachi Electronic Devices (USA), Inc.
Simon J. Frankel and Jeffrey M. Davidson; Covington & Burling LLP; San
Francisco, California; Attorneys for appellants Samsung Electronics Co., Ltd.,
Samsung Semiconductor, Inc., and Samsung Electronics America, Inc.
Bijal Vakil; Palo Alto, California; Christopher M. Curran and Kristen J. McAhren;
Washington, D.C.; and John H. Chung, New York, New York; White & Case LLP;
attorneys for appellants Toshiba Corporation, Toshiba Mobile Display Co., Ltd.,
Toshiba America Electronic Components, Inc., and Toshiba America Information
Kamala Harris, Attorney General, State of California; and Kathleen E. Foote, Ester
H. La, and Adam Miller; Deputy Attorneys General; San Francisco, California;
attorneys for appellee Attorney General of the State of California.
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Robert M. McKenna, Attorney General, State of Washington; and Jonathan Mark
and Brady R. Johnson; Office of the Attorney General; Seattle, Washington;
attorneys for appellee Attorney General of Washington.
Lawrence G. Wasden, Attorney General, State of Idaho; and Brett T. DeLange,
Deputy Attorney General; Boise, Idaho; attorneys for amicus curiae States of
Alaska, Arkansas, Arizona, Delaware, Hawaii, Idaho, Illinois, Iowa, Kansas,
Kentucky, Lousiana, Maine, Maryland, Massachusetts, Minnesota, Mississippi,
Missouri, Montana, Nevada, New Hampshire, New Mexico, North Dakota, Ohio,
Oregon, South Carolina, South Dakota, Utah, Vermont, and West Virginia.
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