Adams et al v. Macon County Greyhound Park, Inc. et al
MEMORANDUM OPINION AND ORDER DENYING 33 MOTION to Remand, as further set out in order. Signed by Chief Judge William Keith Watkins on 11/3/11. (Attachments: # 1 civil appeals checklist)(djy, )
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
LAFAYETTE ADAMS, et al.,
MACON COUNTY GREYHOUND
PARK, INC., d/b/a “VICTORYLAND” )
and “QUINCY’S 777,” et al.,
CASE NO. 3:11-CV-125-WKW
MEMORANDUM OPINION AND ORDER
In this lawsuit, 816 Plaintiffs bring a single claim under an Alabama statute that
voids gambling contracts, seeking to recover money they lost playing electronic bingo
machines at Victoryland and Quincy’s 777 in Macon County, Alabama. Defendants
are Macon County Greyhound Park, Inc., doing business as Victoryland and Quincy’s
777; and the owners and operators of the electronic bingo machines, Multimedia
Games, Inc., IGT, Cadillac Jack, Inc., Nova Gaming, LLC, and Bally Gaming, Inc.
Plaintiffs originally filed this lawsuit in the Circuit Court of Macon County, Alabama,
but it was removed here under the mass action, jurisdictional provision of the Class
Action Fairness Act of 2005 (“CAFA”), see 28 U.S.C. §§ 1332(d)(11) and 1453.
Before the court is Plaintiffs’ motion to remand for lack of subject matter
jurisdiction, filed pursuant to 28 U.S.C. §§ 1332 and 1447(c). (Doc. # 33.) Plaintiffs
argue that this case falls within exceptions to CAFA and should be remanded to state
court. IGT, Multimedia Games, Inc., and Cadillac Jack, Inc., filed responses in
opposition1 (Docs. # 46-48), to which Plaintiffs filed a reply (Doc. # 49). After
careful consideration, the court finds that the motion to remand is due to be denied.
I. STANDARD OF REVIEW
Federal courts have a strict duty to exercise the jurisdiction conferred on them
by Congress. Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 716 (1996). At the
same time, “[f]ederal courts are courts of limited jurisdiction.” Burns v. Windsor Ins.
Co., 31 F.3d 1092, 1095 (11th Cir. 1994). Against that legal backdrop, in actions
removed from state court to federal court, federal courts strictly construe removal
statutes, resolve all doubts in favor of remand, and place the burden of proving
jurisdiction on the removing defendant. Miedema v. Maytag Corp., 450 F.3d 1322,
1328-30 (11th Cir. 2006). These principles were well established long before the
enactment of CAFA in 1995, and the Eleventh Circuit has made clear that,
notwithstanding CAFA’s expansion of diversity jurisdiction over class and mass
actions with interstate significance, these principles remain undisturbed. Id.; see also
Because these Defendants’ arguments are substantially the same, for efficiency, citations
to the briefs and arguments are to IGT’s only. Additionally, given the numerous briefs filed in
support of and in opposition to the motion to remand, these filings are cited herein by using the
docket numbers assigned to the documents in the court’s electronic filing system.
Evans v. Walter Indus., Inc., 449 F.3d 1159, 1164 (11th Cir. 2006) (“CAFA does not
change the traditional rule that the party seeking to remove the case to federal court
bears the burden of establishing federal jurisdiction.”). CAFA contains, however,
several narrow exceptions to federal jurisdiction for actions that “are truly local in
nature.” Evans, 449 F.3d at 1163. And the Eleventh Circuit has held that, “when a
party seeks to avail itself of an express statutory exception to federal jurisdiction
granted under CAFA, . . . the party seeking remand bears the burden of proof with
regard to that exception.” Id. at 1164.
Only the facts material to resolving the motion to remand are set out here.2 At
all times pertinent to this litigation, Defendant Macon County Greyhound Park
(“MCGP”) offered pay-to-play electronic bingo machines to the public at its facility
in Macon County, Alabama, under the names Victoryland and Quincy’s 777.3 (Am.
Compl. ¶¶ 2, 17, 18.) MCGP is an Alabama corporation, which “is owned, in whole
If the facts sound familiar, that is because two similar actions were filed in this court and
are pending before the undersigned. See Adell v. Macon Cnty. Greyhound Park, Inc., No.
3:10cv122 (M.D. Ala. filed Feb. 16, 2010); Bussey v. Macon Cnty. Greyhound Park, Inc., No.
3:10cv191 (M.D. Ala. filed March 4, 2010). In Adell and Bussey, as here, the plaintiffs allege
that they lost money playing illegal electronic bingo machines at Victoryland, and sue to recover
those losses under § 8-1-150 of the Alabama Code. Adell, consisting of 853 plaintiffs, was filed
as a proposed “mass action,” while Bussey was filed as a proposed class action. Defendants in
this lawsuit also are sued in Adell and Bussey.
For ease of reference, Victoryland and Quincy’s 777 are referred to together as
or in part,” by Milton McGregor (“McGregor”). (Am. Compl. ¶ 2.) The remaining
Defendants – Multimedia Games, Inc., IGT, Cadillac Jack, Inc., Nova Gaming, LLC,
and Bally Gaming, Inc. – are alleged to “own[ ] and operate[ ]” the subject electronic
bingo machines and are deemed citizens of states other than Alabama, to include
Texas, Nevada, Georgia and South Carolina.4 (Am. Compl. ¶¶ 3-7.)
The 816 Plaintiffs spent “millions of dollars” playing electronic bingo
machines at Victoryland during the six-month period preceding the filing of the
Complaint. (Am. Compl. ¶¶ 8, 32.) All but two Plaintiffs are Alabama citizens,5 and
Plaintiffs allege that “each of their claims individually and aggregately exceed [sic]
$10,000.” (Am. Compl. ¶¶ 1, 10.)
The alleged illegality of Victoryland’s electronic bingo machines under
Alabama law is at the core of this action.6
Electronic bingo commenced at
These Defendants are occasionally referred to collectively as the electronic bingo
The Amended Complaint alleges that all Plaintiffs are “resident citizens of Alabama.”
(Am. Compl. ¶ 2.) In their motion to remand, however, Plaintiffs acknowledge that two
Plaintiffs are not citizens of Alabama. (Doc. # 33, at 3.)
See, e.g., Am. Compl. ¶¶ 3-7 (Defendants “engage in the operation of illegal bingo
games” and “operate[ ] certain illegal bingo devices.”); Am. Compl. ¶ 19 (The “machines
operated” by Defendants “are illegal electronic bingo devices.”); Am. Compl. ¶ 27 (Defendants’
electronic bingo machines are “in fact, ‘slot machines’ . . . which violate the criminal provisions
of Alabama law.”); Am. Compl. ¶ 29 (Defendants used “illegal machines and devices.”); Am.
Compl. ¶ 33 (Defendants’ “electronic gaming operation” is an “illegal gambling operation under
Alabama constitutional, statutory and common law.”).
Victoryland after the ratification in June 2004 of Amendment No. 744 to the Alabama
Constitution. (Am. Compl. ¶ 12); see also Ala. Const. 1901 amend. No. 744. This
constitutional amendment permits “[t]he operation of bingo games for prizes or
money by nonprofit organizations for charitable, educational, or other lawful
purposes.” Ala. Const. 1901 amend. No. 744. Plaintiffs dispute Defendants’
contention that the electronic bingo operation at Victoryland “was . . . within the
parameters of local Amendment 744,” contending that Amendment No. 744 does not
“authorize the playing of ‘bingo’ through or with electronic devices as have been
used” by Defendants at Victoryland. (Am. Compl. ¶ 13.) Because Victoryland’s
electronic bingo machines allegedly run afoul of Amendment No. 744, Plaintiffs aver
that the machines “are, in fact, ‘slot machines’ . . . which violate the criminal
provisions of Alabama law, including but not limited to, §§ 13(a)-12-20(10) and
13(a)-12-27.” (Am. Compl. ¶ 28.) Plaintiffs further allege that, during the same time
frame that they patronized Victoryland, the electronic bingo machines were rigged,
from time to time, to ensure wins exceeding $1.6 million collectively for a former city
of Birmingham mayor. (Am. Compl. ¶¶ 35-43.)
Seeking to recover gambling losses they incurred playing Defendants’ alleged
illegal electronic bingo machines, Plaintiffs originally filed this lawsuit in the Circuit
Court of Macon County, Alabama, against MCGP. While the action was pending in
state court, Plaintiffs filed an Amended Complaint, adding as Defendants Multimedia
Games, Inc., IGT, Cadillac Jack, Inc., Nova Gaming, LLC, and Bally Gaming, Inc.,
and also adding several new Plaintiffs. The governing Amended Complaint contains
one count. In that count, Plaintiffs allege that they “entered into wagers” with
Defendants, that those wagers were founded upon illegal gambling contracts and that,
therefore, the contracts are void, pursuant to Alabama Code § 8-1-150. (Am. Compl.
¶ 51.) Plaintiffs “seek the recovery of monies paid to” Defendants “for wagers on
improper and illegal bingo games conducted by [them] at Victoryland.” (Am. Compl.
¶ 52; see also Am. Compl., ad damnum clause (“demand[ing] judgment against the
Defendants for the recovery of the monies paid on all electronic bingo games played
by the Plaintiffs plus interest and the costs of this matter”).)
Relying on 28 U.S.C. §§ 1332(d)(11) (governing mass action removals), 1453
(governing class action removals),7 and 1446(b) (governing removal procedures), IGT
removed this action to the United States District Court for the Middle District of
Alabama within thirty days of being served with a summons and a copy of the
Amended Complaint. In its notice of removal, IGT asserts that the district court has
jurisdiction over the case as a mass action because the minimal diversity requirements
CAFA eliminated the rule of unanimity in removal. See 28 U.S.C. § 1453(b) (providing
that a class action “may be removed by any defendant without the consent of all defendants”).
exist, there are more than 100 plaintiffs, the monetary claims exceed $5,000,000 in
the aggregate, and the claims involve common questions of law or fact. (Not. of
Removal ¶¶ 4-12 (Doc. # 2).) On March 11, 2011, Plaintiffs responded by filing the
instant motion to remand.
Plaintiffs present four grounds in support of their motion to remand. First, they
argue that the amount in controversy requirement for removal of a mass action under
CAFA is not satisfied. Second, Plaintiffs contend that this lawsuit does not fit within
CAFA’s definition of a “mass action,” but rather falls into the statutory exception to
that definition found in 28 U.S.C. § 1332(d)(11)(B)(ii)(I). Third, they assert that,
even if this is a “mass action,” the “local controversy” exceptions in 28 U.S.C.
§ 1332(d)(4)(A) & (B) require remand. Fourth, Plaintiffs contend that, alternatively,
the court should, in its discretion, decline jurisdiction under 28 U.S.C. § 1332(d)(3).
IGT opposes each basis.
Amount in Controversy: 28 U.S.C. § 1332(d)(2)
Section 1332(d)(2) vests district courts with “original jurisdiction of any civil
action in which the matter in controversy exceeds the sum or value of $5,000,000,
exclusive of interest and costs, and is a class action in which” the parties satisfy
minimal diversity. Section 1332(d) further provides that the $5,000,000 is calculated
by aggregating the claims of the individual mass action members, see 28 U.S.C.
§ 1332(d)(6), and that a mass action is a “class action” subject to removal.8 See
§ 1332(d)(11)(A); see also Lowery v. Ala. Power Co., 483 F.3d 1184, 1205 (11th Cir.
2007) (Section 1332(d)(11)(A) “incorporated for mass actions the jurisdictional grant
of § 1332(d)(2).”).
In their notice of removal, IGT asserts that the aggregate $5,000,000
jurisdictional minimum is satisfied from the face of the Amended Complaint. For its
calculation, IGT points to the fact that there are 816 named Plaintiffs (Am. Compl.
¶ 10), and that Plaintiffs “assert that each of their claims individually and aggregately
exceed[s] $10,000 exclusive of interest and costs.” (Am. Comp. ¶ 10.) Defendants
argue that, based upon these allegations, the Amended Complaint specifically alleges
that there are 816 Plaintiffs who ascribe a value of more than $10,000 to their
individual claims. Defendants assert that by multiplying 816 (Plaintiffs) and $10,000,
the minimum amount in controversy unambiguously is more than $8,160,000, “an
amount well in excess of the $5,000,000 jurisdictional threshold.” (Doc. # 46, at 11;
see also Not. of Removal ¶ 5 (By alleging at least $10,000 in damages for each named
The other requirements that must be met for an action to be removable as a mass action
under CAFA are a “‘diversity requirement of minimal diversity,’” a “‘numerosity requirement
that the action involve the monetary claims of 100 or more plaintiffs,’” and a “‘commonality
requirement that the plaintiffs’ claims involve common questions of law or fact.’” Pretka v.
Kolter City Plaza II, Inc., 608 F.3d 744, 751 (11th Cir. 2010) (quoting Lowery v. Ala. Power Co.,
483 F.3d 1184, 1202-03 (11th Cir. 2007)). These requirements are not challenged.
Plaintiff, “the face of the Complaint reflects a minimum aggregate amount in
controversy of $8,160,816.”).)
Urging remand, Plaintiffs fault IGT’s reliance on ¶ 10 of the Amended
Complaint. Relying upon Lowery, Plaintiffs argue that paragraph 10 is neither
specific nor unambiguous as to the amount in controversy. (Doc. # 33, at 6.)
Plaintiffs equate their Amended Complaint with that in Lowery, arguing that they
have pleaded only an amount sufficient to establish the jurisdiction of the Alabama
Circuit Courts. This “jurisdictional amount,” according to Plaintiffs, is “not a
statement for relief,” or a “comment on the value of the case, or specific prayer for
relief.” (Doc. # 33, at 6-7.) Plaintiffs argue, in essence, that the value assigned to
their claims in the Amended Complaint’s jurisdictional section is insufficient to
establish the amount in controversy where, as here, the prayer for relief contains an
unspecified demand for damages.
As framed by the parties’ arguments, the issue is whether IGT has
demonstrated the aggregate $5,000,000 jurisdictional minimum by relying on
paragraph 10 of the Amended Complaint, which provides: “Plaintiffs assert that each
of their claims individually and aggregately exceed[s] $10,000, exclusive of interest
and costs.” (Am. Compl. ¶ 10.) IGT clearly has.
In Lowery, the Eleventh Circuit explained that, “[i]f the jurisdictional amount
is either stated clearly on the face of the [removing] documents before the court, or
readily deducible from them, then the court has jurisdiction.”9 483 F.3d at 1211. It
is true that the complaint in Lowery, as here, did not contain an “ad damnum clause
indicating the amount of damages sought.” Id. at 1219. However, in Lowery, there
was no “other concrete information about the value of plaintiffs[’] claims,” id., and
that is where this case parts ways with Lowery. The operative complaint in Lowery
alleged that the plaintiffs sought “compensatory and punitive damages in an amount
in excess of the [Alabama circuit court’s] minimum jurisdictional limit,” which at the
time was $3,000. Id. at 1188 & n.6. The allegation in Lowery established merely that
collectively the claims of the more than 400 plaintiffs exceeded $3,000; there was no
allegation placing a value on each individual plaintiff’s claims, as here, from which
a total value could be easily calculated. Lowery’s conclusion – i.e., that there was “no
unambiguous statement on the face of the amended complaint that would be sufficient
to establish that plaintiffs’ claims potentially exceed $5,000,000 in aggregate” – has
no applicability here. Id. at 1219.
Because the court’s review need not extend beyond the face of the Amended Complaint,
Plaintiffs’ motion to remand does not bring to issue the scope of evidence that can be considered
when, as here, remand is sought within thirty days of a removal based upon an amended
pleading. See 28 U.S.C. § 1446(b)(2); Lowery, 483 F.3d at 1211-15.
In this case, ¶ 10 of the Amended Complaint provides “concrete information
about the value of [P]laintiffs[’] claims.” Lowery, 483 F.3d at 1219. There is no
guesswork required to ascertain the number of Plaintiffs in this mass action: That
number is 816 based upon a simple count of each Plaintiff named in the Amended
Complaint. Cf. Lindsey v. Ala. Tel. Co., 576 F.2d 593, 595 (5th Cir. 1978) (holding
that, where a complaint did not specify the number of plaintiffs in a class action,
neither the defendants nor the court could speculate as to the size of the class for
purposes of determining if the minimum amount in controversy was met).10 In ¶ 10,
Plaintiffs also clearly attach a value to their individual claims, i.e., “each of their
claims individually . . . exceed[s] $10,000, exclusive of interest and costs.” (Am.
Compl. ¶ 10.) Based on these clear and unambiguous numbers, one then only has to
use an uncomplicated, mathematical equation to compute the minimum aggregate
value of Plaintiffs’ claims: 816 x $10,000 = $8,160,000. See Cappuccitti v. DirecTV,
Inc., 623 F.3d 1118, 1122 n.7 (11th Cir. 2010) (using “simple arithmetic” to figure
the size of the class based upon the amount of individual damages).
In sum, the court finds that the face of the Amended Complaint reflects an
aggregate amount in controversy of more than $5,000,000, and that IGT has met its
In Bonner v. City of Prichard, the Eleventh Circuit adopted as binding precedent all
decisions of the former Fifth Circuit issued prior to October 1, 1981. See 661 F.2d 1206, 1209
(11th Cir. 1981) (en banc).
removal burden.11 The issue turns, thus, to whether this action falls within an
exception to CAFA jurisdiction.
Mass Action Exception: § 1332(d)(11)(B)(ii)(I)
This case was removed as a mass action. A “mass action” is defined as “any
civil action . . . in which monetary relief claims of 100 or more persons are proposed
to be tried jointly on the ground that the plaintiffs’ claims involve common questions
of law or fact . . . .” § 1332(d)(11)(B)(i). There are several exceptions to the “mass
action” definition, and Plaintiffs argue that this case falls within the exception set
forth in § 1332(d)(11)(B)(ii)(I): A “mass action” does not include a civil action in
which “all of the claims in the action arise from an event or occurrence in the State
in which the action was filed, and that allegedly resulted in injuries in that State or in
States contiguous to that State.” § 1332(d)(11)(B)(ii)(I). Because this is an exception
to CAFA’s mass action jurisdictional provisions, Plaintiffs have the burden of proof.
See Evans, 449 F.3d at 1164.
Plaintiffs also “note[ ] that [CAFA] removes from the jurisdiction of the district courts
individual actions in which the value of the plaintiff’s claims do not exceed $75,000.” (Doc.
# 33, at 7.) They make no argument or submit authority that the $75,000 provision, see 28
U.S.C. § 1332(d)(11)(B)(i), establishes an additional amount-in-controversy requirement for
mass action removals, and Lowery dictates otherwise. See Lowery, 483 F.3d at 1205 (“[T]he
$75,000 provision was not intended to bar district courts from asserting jurisdiction over the
entire case if each individual plaintiff’s claims do not exceed $75,000.”). Because the issue is
whether removal jurisdiction is proper over the action as a whole, Plaintiffs’ argument for
remand of individual plaintiffs whose claims do not exceed $75,000 warrants no further
discussion at this stage.
The issue is whether Plaintiffs’ claims arise from “an event or occurrence”
within the meaning of § 1332(d)(11)(B)(ii)(I). “As in all statutory construction cases,
[the Court] begin[s] with the language of the statute.” Barnhart v. Sigmon Coal Co.,
534 U.S. 438, 450 (2002) (citing Robinson v. Shell Oil Co., 519 U.S. 337, 340
(1997)). “Where the language of a statute is unambiguous, . . . [the court] need not,
and ought not, consider legislative history.” Rine v. Imagitas, Inc., 590 F.3d 1215,
1222 (11th Cir. 2009). However, “‘[i]n the absence of any plain meaning of the
statutory language, [a court looks] to the legislative history of the statute to determine
whether Congress provided any guidance concerning its intent.’” World Fuel Corp.
v. Geithner, 568 F.3d 1345, 1349 (11th Cir. 2009) (quoting United States v. Fields,
500 F.3d 1327, 1330 (11th Cir. 2007)).
CAFA does not define the phrase “an event or occurrence,” and the parties do
not cite any binding authority defining the phrase. There is, however, legislative
history that provides:
The first exception [§ 1332(d)(11)(B)(ii)(I)] would apply only to a truly
local single event with no substantial interstate effects. The purpose of
this exception was to allow cases involving environmental torts such as
a chemical spill to remain in state court if both the event and the injuries
were truly local, even though there are some out-of-state defendants. By
contrast, this exception would not apply to a product liability or
insurance case. The sale of a product to different people does not
qualify as an event. And the alleged injuries in such a case would be
spread out over more than one state (or contiguous states) – even if all
the plaintiffs in the particular case come from one state.
S. Rep. No. 109-14, at 47 (2005), reprinted in 2005 U.S.C.C.A.N. 3, at 44.
Emphasizing the statute’s singular use of “event” and “occurrence,” IGT adopts
the position espoused in the legislative history that the phrase “an event or
occurrence” refers only to a singular event, like a chemical spill. IGT argues that,
because Plaintiffs allege that they played electronic bingo machines at Victoryland
on “numerous occasions” for a span of at least a year, the individual claims of 816
Plaintiffs “do not arise out of a single event or occurrence,” as contemplated by
§ 1332(d)(11)(B)(ii)(I). (Doc. # 48, at 7.) Moreover, as support for its argument, IGT
relies on three district court decisions, discussed later in this opinion: (1) Galstaldi
v. Sunvest Cmtys. USA, LLC, 256 F.R.D. 673 (S.D. Fla. 2009); (2) Cooper v. R.J.
Reynolds Tobacco Corp., 586 F. Supp. 2d 1312, 1316 (M.D. Fla. 2008); and
(3) Aburto v. Midland Credit Mgmt., Inc., No. 3:08cv1473, 2009 WL 2252518 (N.D.
Tex. July 27, 2009).
Plaintiffs disagree, contending that the phrase “an event or occurrence” is not
limited to a single, discrete incident, but rather includes harms that take place at a
single location. (Doc. # 49, at 2-3.) Plaintiffs argue that the statutory focus should
be on the similarity of the alleged harms – i.e., “the loss of money in the playing of
illegal electronic bingo” at the same casino. (Doc. # 49, at 3.) Because all of the
alleged harms occurred in one specific location in Alabama, Plaintiffs contend that
this action falls outside the definition of a CAFA mass action. (Doc. # 49, at 3.)
Plaintiffs rely upon Carr v. Arvin Industries, No. 05-J-1283-J (N.D. Ala. July 20,
2005) (Order granting motion to remand).12 Brief discussion of the cases relied upon
by the parties is helpful to the analysis.
Carr was before the court on a motion to remand. It involved a suit by
employees of a manufacturing plant, who alleged that they were injured by a toxic
chemical used at the plant in the manufacturing process of automotive mufflers and
that the failure of their employer to provide them protective clothing denied them a
safe work place. Remanding based upon § 1332(d)(11)(B)(ii)(I), the court found that
because the plaintiffs’ “injuries occurred at one specific location in Alabama,” the
facts were more similar to an “‘environmental tort such as a chemical spill,’” rather
than a “‘product liability . . . case’ where the ‘alleged injuries . . . would be spread out
over more than one state . . . .’” Id. at 18 (quoting S. Rep. No. 109-14).
Motions to remand were denied in the decisions relied upon by IGT. In
Cooper, Florida citizens, previously members of a state class action that had been
decertified, sought recovery in state court for illnesses allegedly caused from their
There is no westlaw citation for this opinion.
addiction to cigarettes. See 586 F. Supp. 2d at 1314. After their cases were removed
under CAFA, the court rejected the plaintiffs’ argument that § 1332(d)(11)(B)(ii)(I)
excepted their cases from the “mass action” definition. The court found that the
plaintiffs’ injuries did not qualify as “single events or occurrences.” Id. at 1316. The
According to the CAFA legislative history, this exception keeps a case
based on a single event or occurrence, like a chemical spill or a building
collapse, in state court despite otherwise meeting the definition of a
removable mass action. See S. Rep. 109-14, at 47 (2005), as reprinted
in 2005 U.S.C.C.A.N. 3, 44. This exception does not apply to products
liability cases like this one because “[t]he sale of a product to different
people does not qualify as an event.” Id.
Id. at 1316-17 (internal footnote omitted).
Galstaldi, removed to federal court under CAFA, involved an alleged
fraudulent scheme in which 177 plaintiffs paid on average $300,000 for a preconverted condominium based upon promises that they would one day be residents
of a luxurious Orlando, Florida resort. 256 F.R.D. at 674. The Florida-based
defendants duped the plaintiffs and stole their money, leaving them with “virtually
worthless, dilapidated, bug- and rodent-infested apartments.” Id. The plaintiffs
claimed that their case was excepted from the “mass action” definition by
§ 1332(d)(11)(B)(ii)(I). The court disagreed based upon the “fairly clear” language
of the statutory exception limiting its applicability to “‘an event or occurrence’ in the
singular.” Id. at 677. The court also found that the legislative history buttressed its
statutory reading. Id.
In Aburto, the plaintiffs originally sued in state court for damages “stemming
from void judgments taken against them and any resulting collection activity to
collect on those judgments in Texas.” 2009 WL 2252518, at *4. The defendants
removed the action to federal court as a CAFA mass action, and the plaintiffs
unsuccessfully argued that remand was required because the action fell within
§ 1332(d)(11)(B)(ii)(I). Id. The court in Aburto, as in Cooper and Galstaldi, relied
upon the fact that the statute phrased “an event or occurrence” in the singular. Id.
The court acknowledged that the plaintiffs’ claims shared similar facts, but it agreed
with Galstaldi that “[t]he statutory language is clear – an ‘event or occurrence’ which
can take an action outside the definition of a ‘mass action’ is a singular event or
occurrence.” Id. It further opined that, “[e]ven if the language itself was not clear,
the legislative history evidences this was the intended effect.” Id. Because the action
involved individual lawsuits filed in multiple state courts by different lawyers and
firms, the Aburto court could not “conclude that these actions were ‘an event or
occurrence’ within the meaning of section 1332(d)(11)(B)(ii)(I).” Id.
Two things are as Plaintiffs say. First, as in Carr, Plaintiffs no doubt suffered
their injuries at a single location: a gaming facility in Macon County, Alabama,
called Victoryland. Second, the consequences of Plaintiffs’ actions are the same:
Money was lost betting on electronic bingo machines at Victoryland.
Notwithstanding, the similarity of location and consequences, the claims in this action
are not the type of claims that constitute “an event or occurrence,” within the meaning
of § 1332(d)(11)(B)(ii)(I). As in Cooper, Galstaldi and Aburto, the court cannot
ignore the singular usage of “event” and the singular usage of “occurrence.” This
action is more readily described as involving a series of separate events or
occurrences, rather than a single event or occurrence. Here, there is no singular
contract from which Plaintiffs’ injuries allegedly arose, but instead there are, at a
minimum, 861 contracts or “events” or “occurrences,” each one wholly separate from
every other one. At Victoryland, each Plaintiff engaged in separate and distinct
wagers through his or her individual play of electronic bingo machines. (See Am.
Compl. ¶¶ 30, 32, 36, 49.) It would stretch the limits of the statutory phrase, “an
event or occurrence,” to include within its parameters Defendants’ formation of
separate contracts with different plaintiffs.
Even if this court were to conclude that the statutory language required
amplification from the legislative history, the conclusion would be the same. There
is no tension between the statutory phrase – “an event or occurrence” – and the
legislative history. This action does not involve injuries flowing from the adverse
effects of a chemical spill or a discrete, catastrophic, environmental event, as
contemplated in the Senate Report for inclusion in § 1332(d)(11)(B)(ii)(I). See S.
Rep. No. 109-14, at 47 (providing that § 1332(d)(11)(B)(ii)(I) is intended “to allow
cases involving environmental torts such as a chemical spill to remain in state court
if both the event and the injuries were truly local . . . .”). Nor is a mass tort at issue.
This action is more akin to an “insurance case,” which the Senate Report cites as an
example of a case excluded from § 1332(d)(11)(B)(ii)(I). S. Rep. No. 109-14, at 47;
see also Lafalier v. Cinnabar Serv. Co., No. 10cv5, 2010 WL 1486900, at *4 (N.D.
Okla. April 13, 2010) (finding that plaintiffs, who alleged that insurance companies
impermissibly denied or reduced insurance payments after a tornado hit a Superfund
site and that the Superfund trust improperly devalued plaintiffs’ residences by
deducting tornado-related insurance settlements from the buyout prices, had not
brought claims “aris[ing] out of a single event or occurrence,” so as to be excepted
from the definition of a CAFA “mass action”), aff’d, 391 F. App’x 732 (10th Cir.
2010). Here, not unlike the scenario in Lafalier, where each plaintiff challenged the
insurance company’s rejection of his or her separate insurance claims, each of the 861
Plaintiffs brings claims based on individual gambling contracts he or she entered into
with one or more Defendants. In other words, Plaintiffs predicate their claims on
separate contracts formed with Defendants when they paid to play electronic bingo
machines at Victoryland. Each play and the resulting loss of money form a separate
event for which recovery of money is sought.
In sum, this action is not excluded from the definition of a “mass action” under
Now at issue are some of the exceptions to CAFA
Mandatory Local Controversy Exception: 28 U.S.C. § 1332(d)(4)
“[T]he local controversy exception can be satisfied in either of two ways, as
provided for respectively in 28 U.S.C. § 1332(d)(4)(A) or (B).” Evans, 449 F.3d
at 1163 n.2. If the exception’s requirements are met under either subsection, remand
is mandatory. Plaintiffs have relinquished reliance on § 1332(d)(4)(A), in favor of
The local controversy exception in § 1332(d)(4)(A) applies only if “during the
3-year period preceding the filing of that class action, no other class action has been
filed asserting the same or similar factual allegations against any of the defendants.”
§ 1332(d)(4)(A)(ii). In their reply brief, Plaintiffs “amend their motion to remand to
concede” that this exception “does not precisely apply to this action” (Doc. # 49,
at 4), given the March 4, 2010 filing of the Bussey class action. Bussey involves the
same state law claim against the same Defendants as in this action, see supra note 2.
Based upon that concession, the court finds that Plaintiffs have not satisfied their
burden of demonstrating this exception’s applicability.
Under § 1332(d)(4)(B), “[a] district court shall decline to exercise jurisdiction
[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.” The citizenship of the parties is not in dispute. What is in
dispute is whether there is more than one primary defendant.13 Plaintiffs contend that
MCGP, which undisputedly is the only Defendant with Alabama citizenship, is the
sole primary defendant. That is so, Plaintiffs argue, because MCGP was the facility
that housed the electronic bingo machines, and it was “the facilitator and host of all
of the Plaintiffs’ losses, without which no Plaintiff would have had the ability or
Defendants posit that because the statute refers to “primary defendants” in the plural
form, § 1332(d)(4)(B) “clearly contemplates that more than one defendant may be considered a
primary defendant.” (Doc. # 46, at 7.) The consensus among the courts is that the plural use of
“defendants” means that all primary defendants must be citizens of the state in which the action
was originally filed, here Alabama. See, e.g., In re Hannaford Bros. Co., 564 F.3d 75, 80 (1st
Cir. 2009) (§ 1332(d)(4)(B) “encompass[es] only those suits where . . . all of the primary
defendants are citizens of the same state. Suits involving a primary defendant who is not a
citizen of the forum state cannot qualify for the exception.”); Rader v. Teva Parental Medicines,
Inc., No. 2:10cv818, 2010 WL 3463652, at *2 (D. Nev. Aug. 27, 2010) (“Courts have agreed,
that the term primary generally means all defendants, or those who are the target of the
lawsuit.”); Corsino v. Perkins, No. 2:10cv818, 2010 WL 317418, at *5 (C.D. Cal. Jan. 19, 2010)
(Many courts “agree that the term ‘the primary defendants’ means that all primary defendants
must be citizens of the state concerned.” (collecting cases)); Manson v. GMAC Mortg., LLC, 602
F. Supp. 2d 289, 296 (D. Mass. 2009) (“Courts generally agree that the term ‘the primary
defendants’ means that all primary defendants must be citizens of the state concerned.”
(collecting cases)); Cooper, 586 F. Supp. 2d at 1318 (§ 1332(d)(4)(B) “fails here because the
‘primary defendants’ are not all citizens of the [state in which the action was originally filed].”);
Anthony v. Small Tube Mfg. Corp., 535 F. Supp. 2d 506, 515 (E.D. Pa. 2007) (“‘[T]he plain
language of [§ 1332(d)(4)(B)] requires remand only when all of the primary defendants are
residents of the same state in which the action was originally filed’” (quoting Robinson v.
Cheetah Transp., No. 06-0005, 2006 WL 3322580, at *3 (W.D. La. Nov. 14, 2006))); Brook v.
UnitedHealth Group Inc., No. 06cv12954, 2007 WL 2827808, at *6 (S.D.N.Y. Sept. 27, 2007)
(“The plain language of the home state controversy section demonstrates that Congress intended
that the State citizen requirement pertain to all primary defendants.” (citing Frazier v. Pioneer
Ams. LLC, 455 F.3d 542, 546 (5th Cir. 2006) (interpreting § 1332(d)(5)(A)’s phrase “primary
defendants” to “require[ ] that all primary defendants be states”))).
The parties have not cited any contrary authority. To the extent that Plaintiffs’ opening
brief suggests that the phrase “primary defendants” should be interpreted to mean that “at least
one” primary Defendant is a citizen of Alabama (Doc. # 33, at 4), Plaintiffs’ reply brief abandons
that position. (See Doc. # 49, at 6 (arguing in the reply brief that “the one significant defendant,
MCGP[,] is an Alabama citizen”).)
occasion to lose any money to the other Defendants.” (Doc. # 49, at 5; see also Doc.
# 33, at 3 (“The primary defendant in this action is [MCGP].” (emphasis in original).)
Defendants contend that the electronic bingo machine suppliers also are primary
Defendants. (Doc. # 46, at 8.)
CAFA does not define “primary defendants,” and the Eleventh Circuit also has
not interpreted this phrase in a published opinion.
However, Plaintiffs and
Defendants cite Evans’s discussion of § 1332(d)(4)(A)’s “significant relief”
requirement as support for their positions.14 449 F.3d at 1166-67. In Evans, the
Eleventh Circuit noted that at least two courts had defined “significant relief” as
“relief sought against [an in-state] defendant [that] is a significant portion of the
entire relief sought by the class.” Id. at 1167 (citing Robinson v. Cheetah Transp.,
No. 06-0005, 2006 WL 468820 (W.D. La. Feb. 27, 2006), and Kearns v. Ford Motor
Co., No. 05-5644, 2005 WL 3967998 (C.D. Cal. Nov. 21, 2005)). Evans cited with
approval the rationale in Robinson: “[W]hether a putative class seeks significant
relief from an in-state defendant includes not only an assessment of how many
members of the class were harmed by the defendant’s actions, but also a comparison
One of the requirements under § 1332(d)(4)(A) is that at least one defendant must be a
defendant “from whom significant relief is sought by members of the plaintiff class.”
of the relief sought between all defendants and each defendant’s ability to pay a
potential judgment.” 449 F.3d at 1167 (quoting Robinson, 2006 WL 468820, at *3).
Although not discussed by the parties, other district courts have devised a
number of tests to define “primary defendants.” As observed in Cooper, courts have
found that “‘a primary defendant is one: (1) who has the greater liability exposure;
(2) is most able to satisfy a potential judgment; (3) is sued directly, as opposed to
vicariously . . . ; (4) is the subject of a significant portion of the claims asserted by
plaintiffs; or (5) is the only defendant named in one particular cause of action.’” 586
F. Supp. 2d at 1318 (quoting Brook v. UnitedHealth Group Inc., No. 06cv12954,
2007 WL 2827808, at *5 (S.D.N.Y. Sept. 27, 2007) (collecting cases)).15
Here, the court need not resolve whether Evans’s definition of “significant
relief” is suitable for determining whether a defendant is “primary.” Nor does the
court need to grapple with the varying tests defined by other courts for deciding who
is and who is not a primary defendant. On the facts of this case, all Defendants are
primary defendants no matter the test employed.
See also S. Rep. No. 109-14, at 43 (“For purposes of class actions that are subject to
subsections 1332(d)(3) and (d)(5)(A), the Committee intends that ‘primary defendants’ be
interpreted to reach those defendants who are the real ‘targets’ of the lawsuit – i.e., the
defendants that would be expected to incur most of the loss if liability is found. Thus, the term
‘primary defendants’ should include any person who has substantial exposure to significant
portions of the proposed class in the action, particularly any defendant that is allegedly liable to
the vast majority of the members of the proposed classes (as opposed to simply a few individual
The Amended Complaint makes no distinction between MCGP and the
electronic bingo machine suppliers for purposes of assessing liability or damages. No
Defendant is alleged to be exposed to any greater liability than another; no Defendant
is alleged to have caused any greater injury than another; and no Defendant is alleged
to be any more culpable than another. Rather, it is alleged that Plaintiffs entered into
wagers with each and every Defendant alike, and that the potential liability of all
Defendants is direct as opposed to vicarious. Moreover, Plaintiffs seek recovery of
lost wagers from each and every Defendant, and the recovery is sought “jointly and
severally” from all Defendants. (Am. Compl. ¶¶ 8, 51-52.)
In their brief, Plaintiffs try to focus the spotlight exclusively on MCGP so as
to argue that MCGP is the only primary defendant. However, the face of the
Amended Complaint simply provides no facts to differentiate between any particular
Defendant, much less between MCGP and the electronic bingo machine suppliers.
To the contrary, the Amended Complaint disperses the light equally on all
Defendants, so as to bring the electronic bingo machine suppliers into the primary
defendant spotlight alongside MCGP.
Accordingly, all Defendants qualify as “primary defendants” under
§ 1332(d)(4)(B). Because the “primary defendants” are not all citizens of the state
of Alabama, Plaintiffs cannot establish that the § 1332(d)(4)(B) local controversy
Discretionary Exception: 28 U.S.C. § 1332(d)(3)
Plaintiffs also argue that this action should be remanded under a discretionary
exception to CAFA jurisdiction. See § 1332(d)(3). Section 1332(d)(3) provides that
“[a] district court may, in the interests of justice and looking at the totality of
circumstances, decline to exercise jurisdiction . . . over a class action in which greater
than one-third but less than two-thirds 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,” provided that the six statutorily prescribed factors set
forth in § 1332(d)(3)(A)-(F) justify declination.
IGT argues that this exception is inapplicable because more than two-thirds of
Plaintiffs are citizens of Alabama. Plaintiffs concede that “on its face,” § 1332(d)(3)
“does not apply . . . because all but two Plaintiffs, rather than fewer than two-thirds,”
are Alabama citizens. (Doc. # 33, at 5; see also Am. Compl. ¶ 1.) Plaintiffs argue,
however, that strict compliance with this requirement would contravene the intent of
§ 1332(d)(3) to exclude from CAFA’s jurisdiction “actions in which national interests
are not a concern.” (Doc. # 33, at 5.)
As stated earlier in this opinion, when interpreting a statute, a court “look[s]
first to the statute’s plain meaning.” Lowery, 483 F.3d at 1199. “[I]f the statutory
language is facially unambiguous, [its] inquiry comes to an end.” Id.; see also Conn.
Nat’l Bank v. Germain, 503 U.S. 249, 253-54 (1992) (“[C]ourts must presume that
a legislature says in a statute what it means and means in a statute what it says there.
When the words of a statute are unambiguous, then, this first canon is also the last:
‘judicial inquiry is complete.’” (internal citations omitted)). Strict adherence to this
rule yields only where the “result of adhering to the plain meaning rule ‘is not just
unwise but is clearly absurd.’” United States v. Nix, 438 F.3d 1284, 1286 (11th Cir.
2006) (quoting C.B.S., Inc. v. PrimeTime 24 Joint Venture, 245 F.3d 1217, 1228 (11th
Cir. 2001)). However, this narrow exception is rarely invoked “because if it were
used indiscriminately, ‘clearly expressed legislative decisions would be subject to the
policy predilections of judges.’” Id. (quoting C.B.S., Inc., 245 F.3d at 1228).
Here, the analysis begins and ends with § 1332(d)(3)’s plain language, which
could not be plainer. This statutory exception contains an express numerical
limitation; it is limited to a mass action “in which greater than one-third but less than
two-thirds” of the plaintiffs are citizens of the forum state. § 1332(d)(3). The statute
contains no qualifiers – no “if,” “or” or “unless” – to this size restriction. If Congress
had intended the size limitation to be advisory only, it could have said so, but it did
not. It also can be presumed that Congress knew what it meant when it chose its
fractions in drafting § 1332(d)(3). For instance, in a neighboring subsection,
Congress gave precise instructions pertaining to the court’s exercise of jurisdiction
over mass actions where “greater than two-thirds” of the plaintiffs are citizens of the
state where the action was commenced. See § 1332(d)(4). Yet, in § 1332(d)(3), the
“greater than two thirds” language is absent, in favor of a sliding scale that begins
with one-third and ends with two-thirds.
Plaintiffs have not demonstrated that there is an absurd result in concluding
that § 1332(d)(3)’s numerical limitation means what it says. Their congressional
intent argument is not persuasive, in light of the above discussion and also given that
the “language and structure of CAFA itself indicates that Congress contemplated
broad federal court jurisdiction, with only narrow exceptions.” Evans, 449 F.3d
at 1164 (internal citation omitted). The court will not write out of § 1332(d)(3) the
clear words written by Congress. Because the number of Plaintiffs who are citizens
of Alabama exceeds two-thirds, the court has no authority to decline to exercise
jurisdiction under § 1332(d)(3).
The removing defendant, IGT, has met its burden of proving federal
jurisdiction under CAFA, but Plaintiffs have not met their burden of proving an
exception to CAFA jurisdiction. It is, therefore, ORDERED that Plaintiffs’ motion
to remand (Doc. # 33) is DENIED.
DONE this 3rd day of November, 2011.
/s/ W. Keith Watkins
CHIEF UNITED STATES DISTRICT JUDGE
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