Summary
In Abbott Laboratories, the Fifth Circuit, while recognizing the general rule precluding the aggregation of prospective attorneys' fees for purposes of the jurisdictional amount, nevertheless concluded that a state statute applicable to the plaintiffs' claims provided that attorneys' fees be awarded not to all members of the class, but to the "representative parties," that is, the named plaintiff's.
Summary of this case from Ciardi v. Hoffman-La RocheOpinion
Civil No. 95-402-P-H.
March 15, 1996.
Jeffrey A. Thaler, Berman Simmons, P.A., Lewiston, ME, G. Oliver Koppell, Joseph Lipofsky, Zwerling, Schacter, Zwerling Koppell, New York City, Barbara Hart, Goodkind, Labaton, Rudoff Sucharow, New York City, for Kenneth Karofsky, Paul Cady.
Frank W. Delong, Elizabeth G. Knox, Thompson Bowie, Portland, ME, Nader R. Boulos, J. Andrew Langan, Kirkland Ellis, Chicago, IL, for Abbott Laboratories.
Randall Weill, Preti, Flaherty, Beliveau Pachios, Portland, ME, for American Home Products Corporation.
Terrence Garmey, Smith, Elliott, Smith Garmey, P.A., Portland, ME, for Boehringer Ingelheim Pharmaceuticals, Inc.
Joseph H. Groff, III, Jensen, Baird, Gardner Henry, Portland, ME, for Bristol-Myers Squibb Co.
Melissa A. Hewey, Drummond, Woodsum, Plimpton Macmahon, Portland, ME, for Burroughs-Welcome Co. Glaxo Inc.
Peter J. Detroy, III, Norman, Hanson Detroy, Portland, ME, for Ciba-Geigy Corporation.
William J. Kayatta, Jr., Pierce, Atwood, Scribner, Allen, Smith Lancaster, Portland, ME, for Eli Lilly Co., Marion Merrill Dow Inc.
James B. Haddow, Petruccelli Martin, Portland, ME, for Forest Laboratories, Inc., Johnson Johnson, Rhone Poulenc-Rorer Inc., Sandoz Pharmaceutical Corp., The Upjohn Company, Warner-Lambert Company, G.D. Searle Co.
David P. Ray, Amerling Burns, Portland, ME, for Hoffmann-Laroche Inc.
John D. Gleason, Curtis, Thaxter, Stevens, Broder, Micoleau, Portland, ME, for Knoll Pharmaceutical Company.
Robert H. Stier, Bernstein, Shur, Sawyer Nelson, Portland, ME, James P. Tallon, Shearman Sterling, New York City, for Merck Co., Inc.
Ernest J. Babcock, Martha C. Gaythwaite, Friedman Babcock, Portland, ME, for Pfizer Inc.
Thomas C. Newman, Murray, Plumb Murray, Portland, ME, for Purdue Frederick Company.
Robert H. Stier, Bernstein, Shur, Sawyer Nelson, John G. Calender, Marguerite S. Boyd, Howrey Simon, Washington, DC, for Schering-Plough Corporation.
Robert J. Piampiano, Kevin M. Gillis, Troubh, Heisler Piampiano, P.A., Portland, ME, Mark S. Stewart, Ballard, Spahr, Andrews Ingersoll, Philadelphia, PA, for Smithkline Beecham Pharmaceuticals Co.
Leonard W. Langer, Tompkins, Clough, Hirshon Langer, Portland, ME, for Zeneca, Inc.
ORDER ON PLAINTIFFS' MOTION TO REMAND
The plaintiffs' motion to remand this putative class action removed from state court on diversity of citizenship is GRANTED because the $50,000 amount in controversy is not satisfied.
The plaintiffs' affidavits reveal that, considering the statute of limitations, their actual compensatory damages cannot be more than a couple of thousand dollars each. Even with the trebling that is available under the Maine statute, 10 M.R.S.A. § 1104(1), their damages remain respectively well under $10,000. The defendants agree that the attorney fees available to the plaintiffs under the Maine statute, see § 1104(1), are central to their jurisdictional amount argument.
The plaintiffs filed this action in state court under Maine Rule of Civil Procedure 23 as a class action. Although the state court never had an opportunity to determine whether it could in fact be maintained as a class action, see Me.R.Civ.P. 23(c)(1), and this court likewise has not yet done so under Federal Rule of Civil Procedure 23(c)(1), I treat it as a putative class action. See Doucette v. Ives, 947 F.2d 21, 30 (1st Cir. 1991). Accordingly, any projected attorney fees are to be prorated across the class. See Goldberg v. CPC Int'l, Inc., 678 F.2d 1365, 1367 (9th Cir.), cert. denied, 459 U.S. 945, 103 S.Ct. 259, 74 L.Ed.2d 202 (1982); see also Spellman v. Meridian Bank, ___ F.3d ___, ___, 1995 WL 764548, at *9 (3d Cir. Dec. 29, 1995). The plaintiffs did not seek a specific dollar recovery for damages or attorney fees in their complaint. The burden is on the defendants, as the removing parties, therefore, to show that it is more likely than not that the recovery will exceed the jurisdictional amount as to each plaintiff, Gafford v. General Elec. Co., 997 F.2d 150, 159-60 (6th Cir. 1993); see also Burns v. Windsor Ins. Co., 31 F.3d 1092, 1096 n. 6 (11th Cir. 1994) — i.e., well over $40,000 in attorney fees per class member as prorated. The defendants simply have not met that burden. I therefore do not reach the supplemental jurisdiction arguments advanced by the defendants.
I am not persuaded by the defendants' oral argument that 28 U.S.C. § 1367 requires me to analyze the jurisdictional question as if this were not a class action. As I understand it, the defendants argue that section 1367(a) provides for supplemental jurisdiction over claims asserted by members of the class other than the named representatives. Therefore, goes the argument, I must assess jurisdiction by considering only the representative plaintiffs and consequently must attribute all the attorney fees to them. That argument does not overcome the fact that the plaintiffs filed their complaint initially in state court as a class action and that it is within the plaintiffs' power to frame the nature of their complaint It is true that ultimately the plaintiffs require judicial permission to proceed as a class action, but they have never purported to file individual claims. The "claims in the action" within the meaning of section 1367 are therefore the claims of these plaintiffs as representatives of the class. Thus the caselaw prorating the attorney fees across the class continues to be applicable.
Two observations are appropriate. First, this is not a case like In re Abbott Labs., 51 F.3d 524, 526-27 (5th Cir. 1995), where the state statute awards the attorney fees exclusively to the representative parties. Second, attorney fees are not like punitive damages where "each plaintiff has an integrated right to the full amount of an award." Allen v. R H Oil Gas Co., 63 F.3d 1326, 1334 (5th Cir. 1995).
In St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 288-89, 58 S.Ct. 586, 590, 82 L.Ed. 845 (1938), the United States Supreme Court placed the burden on the plaintiffs in a removal action to show to a legal certainty that the sum claimed is for less than the jurisdictional amount, but that was a case where the plaintiffs had alleged in state court before removal an amount of damages that exceeded the jurisdictional amount and were trying to back away from their allegation. See also Coventry Sewage Assocs. v. Dworkin Realty Co., 71 F.3d 1, 5-6 (1st Cir. 1995). In a second category, where plaintiffs have specifically limited their recovery to less than the jurisdictional amount before removal, the Supreme Court has stated that removal is precluded. St. Paul, 303 U.S. at 290-91, 58 S.Ct. at 591, 82 L.Ed. 845. This case is in a third category — where no amount is alleged Thus the moving party has the burden of demonstrating that the jurisdictional amount is satisfied.
The plaintiffs' motion to remand is GRANTED.
At oral argument, the defendants maintained that I should decline to rule because there is also a remand action involving these plaintiffs now pending in federal court in Alabama with a motion to remand. Nevertheless, I construe the Judicial Panel on Multidistrict Litigation's rules as permitting me to rule and conclude that it is easier for me to determine the impact of Maine law on this individual case and to rule on the jurisdictional issue than to transfer it to the Multidistrict Panel, which has many other concerns.
SO ORDERED.