McAllister v.St. Louis Rams, LLC
MEMORANDUM AND ORDER re: 48 MOTION for Reconsideration of Denial of Plaintiffs' Motion to Remand filed by Consolidated Filer Plaintiff Steve Henry, Consolidated Filer Plaintiff James Pudlowski, Consolidated Filer Plaintiff Gail Henry, Consolidated Filer Plaintiff Louis C. Cross III motion is GRANTED. IT IS FURTHER ORDERED that limited discovery shall be permitted in the Pudlowski matter for the purpose of determining whether the local controversy exception to CAFA jurisdic tion applies. IT IS FINALLY ORDERED that the parties shall file a joint proposal for proceeding with the limited discovery no later than January 13, 2017.( Response to Court due by 1/13/2017.). Signed by District Judge Stephen N. Limbaugh, Jr on 12/15/16. (MRS)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
THE ST. LOUIS RAMS, LLC,
No. 4:16-CV-172 SNLJ
MEMORANDUM AND ORDER
This matter is before the Court on plaintiff James Pudlowski’s motion to
reconsider the Court’s order denying plaintiff’s motion to remand (#48).
This matter’s jurisdictional status has been the subject of considerable litigation.
Plaintiff filed his first complaint in state court , and the defendants removed the case to
this Court citing diversity jurisdiction generally1 and, in the alternative, “minimal
diversity” under the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2), (d)(5) (“CAFA”).
Plaintiff filed a First Amended Complaint (“FAC”) and with it a motion to remand to
state court. The FAC attempted to clarify that the class was comprised only of Missouri
citizens, rendering any “minimal diversity” arguments inaccurate for CAFA purposes.
Plaintiff also argued that even if CAFA jurisdiction were present, then the “local
controversy exception” applied to require remand because more than two-thirds of the
plaintiff class are Missouri citizens. See 28 U.S.C. § 1332(d)(4)(A).
The defendants’ response to the motion to remand argued that the original petition
created minimal diversity because the class definition used the term “Missouri resident,”
It appears that the parties agree that standard diversity jurisdiction, 28 U.S.C. § 1332(a), is not
leaving open the possibility that a non-Missouri citizen who was also a Missouri resident
could be a member of the class and thus provide diversity of citizenship. The defendants
argued that the Court should not consider the FAC, which revised the class definition to
include only Missouri citizens who were Missouri citizens at the time of the petition’s
Plaintiffs replied and pointed out that defendants had not met their burden of proof
to establish CAFA jurisdiction because defendants had not identified any person who
created minimal diversity. Defendants sought and received permission to file a SurReply with attached affidavits from Missouri residents who were not Missouri citizens.
This Court did not consider the affidavits and remanded the matter to state court, but the
Eighth Circuit subsequently (and without ruling on any substantive matter) instructed this
Court to consider the affidavits before reaching a ruling on the remand issue (#55).
On remand from the Eighth Circuit, the plaintiff filed a Sur-Response urging the
Court to consider its FAC definition of the class and citing Ninth Circuit law. Defendants
responded to the Sur-Response. This Court denied the motion to remand and held that
the FAC could not be considered and that minimal diversity exists.
Plaintiff now requests reconsideration of the Court’s order because, he says, the
Court did not consider the “local controversy exception” or the “home state exception”
to CAFA jurisdiction. Defendants respond that plaintiff abandoned those arguments
because they have not been raised since the plaintiff’s very first brief on the motion to
remand. Plaintiff responds that plaintiff did not abandon those arguments; rather, those
arguments were only relevant if the Court found “minimal diversity” under CAFA, which
plaintiff disputed from the beginning. Plaintiff further notes that because it was
defendants’ burden to establish CAFA jurisdiction, the burden was not on plaintiff to
prove the exceptions were effective unless defendants met their burden.
The Court’s Memorandum and Order held that defendants had established each of
the three CAFA jurisdictional elements: (1) minimal diversity among the parties (that is,
any class member and any defendant are citizens of different states); (2) at least 100 class
members; and (3) an amount in controversy of more than $5 million. 28 U.S.C. §
1332(d)(2), (d)(5); Westerfeld v. Indep. Processing, LLC, 621 F.3d 819, 822 (8th Cir.
2010). The Court also held that the class definition in the first petition, not the FAC,
applied because the pre-removal complaint is the relevant document for determining
whether removal was appropriate. (#64 at 5.) Plaintiff points out that the original
petition explicitly stated that there is “no diversity of citizenship” among the parties, but
the Court did not address that matter, instead focusing on the clear language of the class
definition, which refers only to “Missouri residents.”
Plaintiff claims that, in light of the Court’s conclusion that the CAFA
jurisdictional elements had been established, the Court should have applied the local
controversy exception to the facts of the case. Under the local-controversy exception, a
district court must decline to exercise jurisdiction over a class action (1) in which more
than two-thirds of the class members in the aggregate are citizens of the state in which the
action was originally filed, (2) at least one significant defendant is a citizen of the state in
which the class action was originally filed, (3) the principal injuries were incurred in the
state in which the action was filed, and (4) no other class action alleging similar facts was
filed in the three years prior to the commencement of the current class action. 28 U.S.C.
§ 1332(d)(4)(A); Westerfeld, 621 F.3d at 822.
There appears to be no doubt that the second, third, and fourth factors for the local
controversy exception are met here. The parties’ dispute pertains to the first factor,
whether more than two-thirds of the class members are Missouri citizens. Plaintiff argues
that his attorney’s affidavit filed with the motion to remand adequately satisfies the first
element or that, if it does not, then plaintiff should be afforded jurisdictional discovery
regarding state citizenship. See Hood v. Gilster-Mary Lee Corp., 785 F.3d 263, 266 (8th
Cir. 2015) (describing discovery process but holding that “last-known address” evidence
was not persuasive ). The Eighth Circuit approves of the Seventh Circuit’s approach, in
plaintiffs may “take a random sample of potential class members, ascertain
the citizenship of each on the date the case was removed, and extrapolate to
the class as a whole. If the sample yields a lopsided result, the outcome is
clear without the need for more evidence. If the result is close to the
statutory two-thirds line, then do more sampling and hire a statistician to
ensure that the larger sample produces a reliable result.”
Id. (quoting Myrick v. WellPoint, Inc., 764 F.3d 662, 665 (7th Cir. 2014) (internal
The Rams were located in St. Louis, and intuitively a Missouri team would be
patronized by Missouri citizens. Even though it appears to the Court that there is a great
likelihood that more than two-thirds of the plaintiffs’ class consists of Missouri citizens,
out of an abundance of caution, the Court will allow limited discovery for the purpose of
obtaining a more statistically significant sample than the ad-hoc analysis performed by
plaintiff’s counsel. The parties shall submit a proposal for obtaining such a statistically
significant sample to the Court.
IT IS HEREBY ORDERED that plaintiff’s motion for reconsider (#48) is
IT IS FURTHER ORDERED that limited discovery shall be permitted in the
Pudlowski matter for the purpose of determining whether the local controversy exception
to CAFA jurisdiction applies.
IT IS FINALLY ORDERED that the parties shall file a joint proposal for
proceeding with the limited discovery no later than January 13, 2017.
Dated this 15th day of December, 2016.
STEPHEN N. LIMBAUGH, JR.
UNITED STATES DISTRICT JUDGE
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