Reddick v. Global Contact Solutions, LLC

Filing 25

OPINION & ORDER: Plaintiff is directed to supplement his response to this court's Order to Show Cause 17 dated June 1, 2015, and Defendant may optionally supplement its response to that same Order as discussed above by not later than midnight on Tuesday, July 28, 2015. Signed on 7/21/15 by Magistrate Judge Paul Papak. (gm)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON

ROSS REDDICK,
Plaintiff,
3:15-CV-425-PK
OPINION AND
ORDER

v.

GLOBAL CONTACT SOLUTIONS, LLC,
Defendant.
PAPAK, Magistrate Judge:
Plaintiff Ross Reddick filed this putative class action against defendant Global Contact
Solutions, LLC ("GCS"), in the Multnomah County Circuit Court on behalf of himself and all
others similarly situated on Januaiy 29, 2015. By and through his state-cou1t complaint, Reddick
alleged GCS' liability under Oregon statuto1y law for failure to pay wages and for failure to pay
all wages due and owing at the termination of employment, both such failures arising out of GCS'
alleged practice of requiring all of its employees to attend mandat01y training at the beginning of
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their employment, without compensation. GCS removed Reddick's action to this court effective
March 13, 2015, on the purpo1ied basis of original federal jurisdiction under the Class Action
Fairness Act of2005 ("CAFA"). Reddick moved for remand of this action to the Multnomah
County Court on April 15, 2015, and oral argument was held in connection with Reddick's
motion on May 26, 2015.
Following oral argument in connection with Reddick's motion, on June 1, 2015, I issued
an Opinion and Order and Order (#17) to Show Cause directing both Reddick and GCS to show
cause within 45 days why Reddick's action should not be remanded to state cou1i for lack of
federal subject-matter jurisdiction. By and through that order, I noted that, on the arguendo
assumption that GCS had been or would be successful in establishing the four elements of
federal subject-matter jurisdiction under CAFA - namely, that (1) the amount in controversy
exceeds five million dollars exclusive of interest and costs, (2) any plaintiff class member is a
citizen of a state different from any defendant, (3) the primmy defendants are not states, state
officials, or other government entities against whom the district comi may be foreclosed from
ordering relief, and (4) the number of plaintiffs in the class or classes at issue is at least 100, see
28 U.S.C. §§ 1332(d)(2), (d)(5); see also Serrano v. 180 Connect, Inc., 478 F.3d 1018,
1020-1021, 1021 n. 3, 1021 n. 4 (9th Cir. 2007) (citations omitted) - such evidence of record as
was material to the question and such material data as was fit for judicial notice nevertheless
suggested the empirical likelihood, but fell short of establishing, that this comi could be obliged
to refrain from the exercise of jurisdiction under CAFA pursuant to one or both of two

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mandatory abstention rules codified at 28 U.S.C. §§ 1332(d)(4)(A) and 1332(d)(4)(B) 1 (or,
alternatively, that this comi could enjoy discretion to refrain from the exercise of CAFA
jurisdiction pursuant to the discretionary abstention rule codified at 28 U.S.C. § 1332(d)(3)2). In

1

The "local controversy" exception codified at 28 U.S.C. § 1332(d)(4)(A) requires
federal courts to decline to exercise CAFA jurisdiction over:
(i)

... a[ny] class action in which(I)

greater than two-thirds of the members of all proposed plaintiff
classes in the aggregate are citizens of the State in which the action
was originally filed;

(II)

at least 1 defendant is a defendant(aa)

(bb)

(ii)

whose alleged conduct fonns a significant basis for the
claims asserted by the proposed plaintiff class; and

(cc)

(III)

from whom significant relief is sought by members of the
plaintiff class;

who is a citizen of the State in which the action was
originally filed; and

principal injuries resulting from the alleged conduct or any related
conduct of each defendant were incuned in the State in which the
action was originally filed; and

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 on behalf of the same or other persons ....

28 U.S.C. § 1332(d)(4)(A). The "home-state controversy" exception codified at 28 U.S.C. §
1332(d)(4)(B) similarly requires the federal courts to decline to exercise CAFAjurisdiction over
any class action in which "two-thirds or more of the members of all proposed plaintiff classes in
the aggregate, and the primaiy defendants, are citizens of the State in which the action was
originally filed." 28 U.S.C. § 1332(d)(4)(B). The Ninth Circuit treats these provisions as setting
forth "exceptions to jurisdiction" under CAFA. Serrano, 478 F.3d at 1023.
2

Pursuant to 28 U.S.C. § 1332(d)(3), the courts may, in their discretion, decline to
exercise CAFAjurisdiction where "greater than one-third but less than two-thirds of the
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consequence, and because of the importance of avoiding federal disposition of any claim not
subject to federal jurisdiction, I directed both patiies to submit evidence or argument material to
the applicability or non-applicability of those abstention rules (chiefly, evidence or argument
relevant to the determination of the state of citizenship of the putative class members as of the
date this action was removed to federal cou1i). In addition, I stayed fu1iher proceedings in this
action other than discovery calculated to lead to the production of admissible evidence regarding
the place of citizenship of the members of Reddick's proposed class of plaintiffs as of the date
this action was removed, pending this comi's dete1mination regarding its subject-matter
jurisdiction to consider Reddick's claims.
On July 16, 2015, both GCS and Reddick responded to the Order to Show Cause. GCS
responded by reiterating its previously proffered argument that Reddick has failed to meet his
burden in connection with his motion for remand to establish that this comi lacks subject-matter
jurisdiction over his claims, while Reddick responded by asse1iing that this court should remand
his action because GCS' response to the Order to Show Cause was inadequate, and in the
alternative by requesting a seven-day extension of time to supplement his response, in order to
permit review of approximately 11,000 pages of documents produced to him by GCS bearing on
the citizenship of the members of the proposed class.
As to GCS' response, I agree with Reddick as to its inadequacy to establish that this court
may properly exercise subject-matter jurisdiction over this action. If at any time prior to final
judgment it appears that a federal comi lacks subject-matter jurisdiction over a removed case, 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." 28 U.S.C. § 1332(d)(3).
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coutt must remand the action to state court. See 28 U.S.C. § 1447(c). The question of who bears
the burden of persuasion under CAFA in connection with a motion to remand is immaterial to
this coutt's sua sponte determination of whether it may properly exercise federal subject-matter
jurisdiction. In consequence, GCS' response provides no grounds for disregarding the empirical
likelihood that one or both of the mandato1y abstention mies discussed above is applicable to
prohibit such exercise.
Neve1theless, because (as stated in the Order to Show Cause of June 1, 2015) it would be
improvident for this comt to determine the applicability of the statutmy abstention rules on the
sole basis of the evidence referenced above, this court's detennination regarding its jurisdiction to
hear Reddick's claims should be based on the fullest evidentiary record that may be arranged
without undue bmden. Reddick's request for extension of time is therefore granted. Reddick is
directed to supplement his response with evidence and argument regarding the place of
citizenship of the members of his proposed class of plaintiffs as of the date this action was
removed, by not later than midnight on Tuesday, July 28, 2015. GCS may, in its discretion,
likewise supplement its response to the Order to Show Cause by not later than midnight on July
28, 2015, with argument or evidence bearing on this court's sua sponte determination of whether

it may properly exercise federal subject-matter jurisdiction over Reddick's claims
notwithstanding the mandatory abstention mies codified at Sections 1332(d)( 4)(A) and
1332(d)(4)(B) or the discretionary abstention rule codified at Section 1332(d)(3).

CONCLUSION
For the reasons set forth above, Reddick is directed to supplement his response to this
coutt's Order (#17) to Show Cause dated June 1, 2015, and GCS may optionally supplement its

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response to that same Order as discussed above by not later than midnight on Tuesday, July 28,
2015.

Dated this 21st day of July, 2015.

Hqnorable Paul Pap k
Urlited States Magistrate Judge

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