Litigating California Wage & Hour and Labor Code Class Actions
Litigating California Wage & Hour and Labor Code Class Actions
Litigating California Wage & Hour and Labor Code Class Actions
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alleged conduct or any related conduct of each defendant were incurred in the forum<br />
state, <strong>and</strong> (4) no other class action was filed within the past three years asserting the<br />
same or similar factual allegations against any of the defendants on behalf of the<br />
same or other persons. 321<br />
Some circuits, including the Eleventh Circuit, have made it clear that the CAFA’s<br />
language favors federal jurisdiction over class actions <strong>and</strong> that its legislative history<br />
suggests that Congress intended the local controversy exception to be a narrow one,<br />
“with all doubts resolved ‘in favor of exercising jurisdiction over the case.’” 322<br />
Consistent with this notion, several circuits agree that the party seeking rem<strong>and</strong> back<br />
to the state court bears the burden to demonstrate that the court lacks jurisdiction<br />
under the “local controversy” exception. 323<br />
The Ninth Circuit finally addressed this issue on January 25, 2011, in Coleman v.<br />
Estes Express Lines, holding that a “district court cannot look beyond the complaint<br />
in determining whether the criteria of subsections (aa) [“significant relief”] <strong>and</strong> (bb)<br />
[“significant basis”] have been satisfied.” 324 Thus, extrinsic evidence will not be<br />
considered in evaluating this exception. The court explained that this conclusion was<br />
required not only by the plain language of these subparts, but also because any<br />
contrary holding would result in an expansive “mini-trial,” contrary to congressional<br />
intent that jurisdiction determinations be made quickly under CAFA. 325<br />
2. Home State Exception<br />
Under the home state exception, a federal court must decline jurisdiction where: (1)<br />
2/3 or more of the proposed class members are citizens of the forum state <strong>and</strong> (2)<br />
the primary defendants are citizens of the forum state. 326 Unlike the local controversy<br />
exception, this exception does not require the court to consider other lawsuits. The<br />
party moving to rem<strong>and</strong> the class action to state court must prove that the home state<br />
exception applies. 327<br />
321<br />
322<br />
323<br />
324<br />
325<br />
326<br />
327<br />
28 U.S.C. § 1332(d)(4).<br />
Evans v. Walter Indus., Inc., 449 F.3d 1159 (11th Cir. 2006).<br />
See Serrano, 478 F.3d at 1019 (noting agreement with other circuits that party seeking rem<strong>and</strong> must demonstrate<br />
applicability of “local controversy” exception); Frazier v. Pioneer Americas LLC, 455 F.3d 542, 546 (5th Cir. 2006); Hart<br />
v. FedEx Ground Package Sys. Inc., 457 F.3d 675, 680-81 (7th Cir. 2006); see also S. Rep. No. 109-14, at 44 (“It is the<br />
Committee’s intention with regard to each of these exceptions that the party opposing federal jurisdiction shall have the<br />
burden of demonstrating the applicability of an exemption.”).<br />
Coleman v. Estes Express Lines, 631 F.3d 1010, 1015 (9th Cir. 2011).<br />
Id. at 1017.<br />
28 U.S.C. § 1332(d)(4)(B).<br />
Serrano, 478 F.3d at 1024.<br />
Seyfarth Shaw LLP | www.seyfarth.com <strong>Litigating</strong> <strong>California</strong> <strong>Wage</strong> & <strong>Hour</strong> <strong>Class</strong> <strong>Actions</strong> (12th Edition) 71