Abrego Abrego v. The Dow Chemical Co.

CourtUnited States Courts of Appeals. United States Court of Appeals (9th Circuit)
Citation443 F.3d 676
Docket NumberNo. 06-55109.,06-55109.
PartiesAntonio ABREGO ABREGO, et al., Plaintiffs-Appellees, v. THE DOW CHEMICAL CO, et al.; Shell Oil Company, d/b/a Shell Chemical Company, and Shell Agricultural Chemical Company, Defendants-Appellants.
Decision Date04 April 2006

Michael L. Brem, Shirrmeister Diaz-Arrastia Brem LLP, Houston, TX, argued and was on the briefs for the appellants. Gennaro A. Filice, Nicholas D. Kayhan, Richard H. Poulson, Filice Brown Eassa & McLeod LLP, Oakland, CA, were also on the briefs for the appellants.

Howard B. Miller, Girardi & Keese, Los Angeles, CA, argued and was on the briefs for the appellees. Walter J. Lack and Elizabeth Lane Crooke, Engstrom Lipscomb & Lack, Los Angeles, CA; Thomas V. Girardi, Girardi & Keese, Los Angeles, CA; Joe J. Fisher, II, Mark Sparks, and Scott C. Kinsel, Provost Umphrey Law Firm, Beaumont, TX; and Benton Musslewhite, Law Offices of Benton Musslewhite, Houston, TX, were also on the briefs for the appellees.

Appeal from the United States District Court for the Central District of California; R. Gary Klausner, District Judge, Presiding. D.C. No. CV-05-03608-RGK.

Before: McKEOWN and BERZON, Circuit Judges, and KING,* Senior District Judge.


The recently enacted Class Action Fairness Act of 2005 ("CAFA"), Pub.L. No. 109-2, 119 Stat. 4, alters the landscape for federal court jurisdiction over class actions. In addition to traditional class actions, CAFA covers certain other cases involving large numbers of plaintiffs, denominated "mass actions." Dow Chemical Company ("Dow") brings this interlocutory appeal,1 pursuant to 28 U.S.C. § 1453(c)(1),2 from the district court's order remanding this purported "mass action."

Dow maintains that under CAFA and contrary to preexisting removal jurisdiction law: (1) plaintiffs bear the burden of refuting the district court's removal jurisdiction; (2) a "mass action" is removable regardless of whether there is jurisdiction over all plaintiffs whose claims are necessary to qualify the action as a mass action; and (3) the district court must allow jurisdictional discovery to determine the amount in controversy. The disputes between the parties on these discrete issues reflect a larger disagreement over whether the changes wrought by CAFA generally are limited to those enunciated in CAFA's text, or whether courts should infer a broader transformation of jurisdictional principles than the statutory language indicates.

We hold that CAFA did not shift to the plaintiff the burden of establishing that there is no removal jurisdiction in federal court and that Dow did not meet its burden. We therefore affirm the district court's remand of this action to state court. We save for a later day detailed consideration of CAFA's muddled "mass action" provisions.


One thousand one hundred and sixty Panamanian banana plantation workers ("the workers") filed a complaint asserting claims stemming from their alleged exposure to 1, 2-dibromo-3-chloropropane ("DBCP"), a chemical pesticide sold under the brand names "Nemagon" and "Fumazone." The operative complaint alleges that although the Environmental Protection Agency banned almost all DBCP use in the United States in 1979, the defendants continued to distribute and use the pesticide on plantations in Panama. The workers allege that they suffered "sterility and other serious injuries" as a result of exposure to the pesticide and seek an unspecified amount of special, general, and punitive damages, pre- and post-judgment interest, and attorneys' fees and costs.

On May 13, 2005, three weeks after the state court suit commenced, Dow filed a notice of removal with the district court and, ten days later, an amended notice of removal, both pursuant to CAFA. Dow invoked § 1332(d)(11), which provides for federal jurisdiction over "mass actions." For the purposes of CAFA, a "mass action" is "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, except that jurisdiction shall exist only over those plaintiffs whose claims in a mass action satisfy the jurisdictional amount requirements under" § 1332(a). § 1332(d)(11)(B). Section 1332(a), in turn, requires that the amount in controversy exceed $75,000. Under subsection (d)(11)(A), an action that qualifies as a mass action will be "deemed to be a class action removable under . . . [§ 1332(d)(2)-(10)] if it otherwise meets the provisions of those paragraphs." § 1332(d)(11)(A). Prominent among the requirements in these specified paragraphs are that the aggregate amount in controversy must exceed $5,000,000, and that the action must satisfy CAFA's new minimal diversity requirements between plaintiffs and defendants. § 1332(d)(2).

The district court ordered Dow to show cause as to whether "[t]he amount in controversy does not exceed $5,000,000, exclusive of interest and costs, and/or the amount in controversy for each plaintiff does not exceed $75,000." Dow responded, arguing that: (1) CAFA shifted the burden of establishing whether jurisdiction is proper from the removing defendants to the plaintiffs seeking remand; (2) as long as the action prior to removal involved the claims of more than 100 plaintiffs and more than $5,000,000 in the aggregate, the "mass action" subsection provides for removal jurisdiction and calls for subsequent remand only of the claims of those plaintiffs who do not meet the $75,000 jurisdictional amount requirement; and (3) there should be limited discovery related to the amount in controversy, as "contemplated by Congress in enacting CAFA."

On October 11, 2005, the district court issued a brief remand order:

[T]he Court finds that Defendant has failed to meet its burden of showing that the action constitutes a "mass action," as defined by the applicable statute (i.e., there are 100 or more plaintiffs over which this court has jurisdiction that can be proposed to be tried jointly). As such, the Court determines that it lacks subject matter jurisdiction over this case, and remands the action to state court.

Dow appeals this order, reasserting the same arguments presented to the district court.

We review a district court's remand order de novo. Emrich v. Touche Ross & Co., 846 F.2d 1190, 1194 (9th Cir.1988); Ansley v. Ameriquest Mortgage Co., 340 F.3d 858, 861 (9th Cir.2003). Our standard of review regarding requests for jurisdictional discovery related to removed cases is discussed below. See infra section II.D.


A little over a year ago, CAFA became law, amending, inter alia, § 1332 and adding § 1453 to title 28 of the United States Code. These new provisions govern this case. To understand them, however, one must first understand the statutory scheme to which they were added. We therefore begin with a review of those background principles and then proceed to describe the amendments.


Section 1332(a), a preexisting section, vests the district courts with "original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between" diverse parties as defined by subsections (a)(1)-(4). § 1332(a).3 Although the statute does not so require explicitly, the Supreme Court has repeatedly held, and recently reiterated, that § 1332(a) requires complete diversity, whereby "[i]n a case with multiple plaintiffs and multiple defendants, the presence in the action of a single plaintiff from the same State as a single defendant deprives the district court of original diversity jurisdiction over the entire action." Exxon Mobil Corp. v. Allapattah Servs., Inc., ___ U.S. ___, 125 S.Ct. 2611, 2617, 162 L.Ed.2d 502 (2005) (citing Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435 (1806); Owen Equip. & Erection Co. v. Kroger, 437 U.S. 365, 375, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978)).

Under § 1441, another preexisting section, "civil action[s] brought in a State court of which the district courts of the United States have original jurisdiction," may be removed by the defendant or defendants to federal district court. § 1441(a);4 accord Syngenta Crop Prot., Inc. v. Henson, 537 U.S. 28, 33, 123 S.Ct. 366, 154 L.Ed.2d 368 (2002) ("Under the plain terms of § 1441(a), in order properly to remove [an] action pursuant to that provision, petitioners must demonstrate that original subject-matter jurisdiction lies in the federal courts."). Cases removed from state court under § 1441 are ordinarily subject to a stricter diversity standard than applies where original federal jurisdiction is invoked:

While § 1332 allows plaintiffs to invoke diversity jurisdiction, § 1441 gives defendants a corresponding opportunity. . . . The scales are not evenly balanced, however. An in-state plaintiff may invoke diversity jurisdiction, but § 1441(b) bars removal on the basis of diversity if any "part[y] in interest properly joined and served as [a] defendan[t] is a citizen of the State in which [the] action is brought."

Lincoln Property Co. v. Roche, ___ U.S. ___, 126 S.Ct. 606, 613, 163 L.Ed.2d 415 (2005) (alterations in original) (quoting § 1441(b)). In addition, all defendants must agree to removal, see United Computer Sys., Inc. v. AT & T Corp., 298 F.3d 756, 762 (9th Cir.2002) ("[T]he usual rule is that all defendants in an action in a state court must join in a petition for removal. . . ."), and removal must occur within one year of the commencement of the action, § 1446(b).


Section 1332(d), added by CAFA, vests the district court 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, among other requirements, minimal diversity.5 Section 1332(d) thus abandons the complete...

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