Alinsub v. T-Mobile

• Decision Date: 13 February 2006
• Docket Number: No. 05-2300 Ml/AN.,05-2300 Ml/AN.
• Citation: 414 F.Supp.2d 825
• Parties: Roy ALINSUB and Millicent Viva, on behalf of themselves and on behalf of all others similarly situated, Plaintiffs, v. T-MOBILE and T-Mobile USA, Defendants.
• Court: U.S. District Court — Western District of Tennessee

414 F.Supp.2d 825

Roy ALINSUB and Millicent Viva, on behalf of themselves and on behalf of all others similarly situated, Plaintiffs, v. T-MOBILE and T-Mobile USA, Defendants.

No. 05-2300 Ml/AN.

United States District Court, W.D. Tennessee, Western Division.

February 13, 2006.

Christopher Lee Brown, Law Office of Christopher L. Brown, Memphis, TN, J. Mitchell Clark, Corpus Christi, TX, for Plaintiffs.

Christopher Jones, Wyatt Tarrant & Combs, Robert L. Crawford, Wyatt Tarrant & Combs, Memphis, TN, for Defendants.

ORDER GRANTING MOTION TO REMAND REMOVED CASE

MCCALLA, District Judge.

Before the Court is Plaintiffs' Motion to Remand Removed Case, filed June 3, 2005. Defendant T-Mobile USA filed a response in opposition on July 12, 2005. On January 19, 2006, the Court entered an order requesting that the parties submit supplemental memoranda on whether the amount-in-controversy requirement under 28 U.S.C. § 1332 has been satisfied in this case. Defendant¹ filed a supplemental memorandum on this issue on January 26, 2006. Plaintiff did not file a supplemental memorandum. For the reasons set forth below, Plaintiffs' motion is GRANTED.

I. Background

Plaintiffs commenced the instant action by filing a complaint in the Chancery Court of Shelby County, Tennessee, on February 14, 2005. According to the Complaint, Plaintiffs Roy Alinsub and Millicent Viva bring this class action against Defendant "for unfair, deceptive and unlawful trade practices and conduct connected to [Defendant's] unauthorized and deceptive billing and charging practices to individual consumers for text messages sent outside of the United States." (Compl. ¶ 1.) Specifically, Plaintiffs allege that they contracted with Defendant for cellular phone service, and Defendant promised Plaintiffs that they would receive free text messaging capability as part of this service. In fact, Plaintiffs were charged "at least $.15" per text message sent outside the United States. (Id. ¶¶) Plaintiffs allege that "these charges are made in breach of the agreement between Plaintiffs and [Defendant] and without prior approval of the Plaintiffs and other consumers[,] and [Defendant is] requiring the Plaintiffs and other consumers to pay these fees in order to continue their individual cellular phone service or the service will be disconnected." (Id. ¶ 13.)

The Complaint alleges causes of action for breach of contract and unjust enrichment under the common law and the Tennessee Consumer Protection Act of 1977, §§ 47-18-101, et seq. (Compl. ¶¶ 14, 21-24.) Plaintiffs claim that Defendant "should be required to reimburse the Plaintiffs and each of the proposed unnamed plaintiff class members for all funds received for the repayment of the checks, including, but not limited to, principle [sic], interest, fees, and penalties, which are the subject matter of this suit, due to the inequitable, deceptive, and misleading practices as set forth herein." (Id. ¶ 19.) Specifically, Plaintiffs seek compensatory and statutory damages, treble damages, and reasonable attorneys' fees. They also demand that Defendant "refund[] and reimburse to the Plaintiffs and each of the proposed class members all funds received by [Defendant] for text messages sent outside of the United States." (Id. 1120.) The Complaint also states that "Plaintiffs ... have incurred damages that amount to less than the sum of Seventy-five Thousand Dollars and 00/100 ($75,000) per person as a consequence of Defendant's conduct. This case may not, in good faith, be removed to federal court because no individual Plaintiffs' claims exceed the amount in [ ] controversy requirement (Id. ¶ 10.)

On April 25, 2005, Defendant removed this action to federal court pursuant to 28 U.S.C. §§ 1332, 1441, and 1446. In its Notice of Removal, Defendant contends that removal is proper because complete diversity of citizenship exists between Defendant, a Delaware corporation, and Plaintiff Alinsub, a resident of Tennessee, and that the amount in controversy exceeds $75,000. (Notice of Removal ¶¶ 4, 13.) Defendant contends that the citizenship of the other named plaintiff, Millicent Viva, should not be considered for purposes of diversity jurisdiction because Ms. Viva has been fraudulently joined as a plaintiff in this action. Because the Court finds that Defendant has failed to show that the amount in controversy satisfies the diversity jurisdictional requirement, as set forth below, the Court does not address Defendant's contention that Plaintiff Viva was fraudulently joined.

II. Standard

A civil action brought in state court may be removed by defendant if the action could have been brought there originally. 28 U.S.C. § 1441(a). "[S]tatutes conferring removal jurisdiction are ... construed strictly because removal jurisdiction encroaches on a state court's jurisdiction." Brierly v. Alusuisse Flexible Packaging, Inc., 184 F.3d 527, 534 (6th Cir.1999) (citation omitted). Doubts about removal "should be resolved in favor of remand to the state courts." Id.; see also Nasco Inc. v. Norsworthy, 785 F.Supp. 707, 710 (M.D.Tenn.1992)(noting that removal statutes "are to be strictly construed ... in favor of remand").

A federal district court has original jurisdiction of an action between citizens of different states where the amount in controversy exceeds $75,000, exclusive of costs and interest. 28 U.S.C. § 1332(a). In diversity citizenship cases, "[t]he general federal rule has long been to decide what the amount-in-controversy is from the complaint itself, unless it appears or is in some way shown that the amount in the complaint is not claimed `in good faith.'" Horton v. Liberty Mutual Ins. Co., 367 U.S. 348, 353, 81 S.Ct. 1570, 6 L.Ed.2d 890 (1961)(quoting St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 288-89, 58 S.Ct. 586, 82 L.Ed. 845 (1938)). In this case, Plaintiffs have expressly claimed less than $75,000 per person. (Compl. ¶ 10 ("Plaintiffs ... have incurred damages that amount to less than the sum of Seventy-five Thousand Dollars and 00/100 ($75,000) per person as a consequence of Defendant's conduct."))

"Generally, since the plaintiff is master of the claim, a claim specifically less than the federal requirement should preclude removal." Gafford v. General Electric Co., 997 F.2d 150, 157 (6th Cir. 1993). Removal may be proper, however, where the defendant can show a "reasonable probability" or "substantial likelihood" that the plaintiffs intend to seek damages in excess of $75,000. Id. at 158. "[A] defendant desiring to remove a case has the burden of proving the diversity jurisdiction requirements." Id. at 155.

III. Analysis

Defendant makes four arguments why the amount in controversy exceeds $75,000 in this case: (1) in the Sixth Circuit, putative class members' claims may be aggregated to meet the amount-in-controversy requirement; (2) the putative class members' claims can be aggregated to satisfy the requirement because Plaintiffs' seek disgorgement of all funds received by Defendant for text messages sent outside the United States; (3) the cost to Defendant of complying with Plaintiffs' requested injunctive relief exceeds $75,000; and (4) Plaintiffs' claim for attorneys' fees satisfies the amount-in-controversy requirement. (Def.'s Supp. Br. Regarding Amount in Controversy ("Def.'s Supp. Br.") 1-2.) The Court will address Defendant's arguments in turn.

A. Aggregation of Plaintiffs' Claims for Damages

The well-settled rule in diversity class actions is that "the separate and distinct claims of two or more plaintiffs cannot be aggregated in order to satisfy the jurisdictional amount requirement." Snyder v. Harris, 394 U.S. 332, 336, 89 S.Ct. 1053, 22 L.Ed.2d 319 (1969). The limited exception to this rule allows aggregation only "in cases where two or more plaintiffs unite to enforce a single title or right in which they have a common and undivided interest." Id.; see also Sellers v. O'Connell, 701 F.2d 575, 579 (6th Cir. 1983); Gavriles v. Verizon Wireless, 194 F.Supp.2d 674, 680 (E.D.Mich.2002). A common and undivided interest exists when, "if one plaintiff cannot or does not collect his share, the shares of the remaining plaintiffs are increased." Sellers, 701 F.2d at 579 (noting that "[w]here a group of plaintiffs litigate individual cash claims the amount of which remain unaffected by the results obtained by fellow plaintiffs, the litigants may not aggregate their claims when alleging jurisdiction").

Defendant does not argue that Plaintiffs have a "common and undivided" interest in their claims for damages. Rather, Defendant contends that "in this Circuit, the amount in controversy may be established by the aggregation of each putative class member's alleged damages." (Def.'s Supp. Br. 4.) Defendant relies solely on Olden v. LaFarge Corp., 383 F.3d 495 (6th Cir. 2004), for support. As explained below, however, Defendant has misconstrued Olden's holding.

Olden holds that the Judicial Improvements Act, codified at 28 U.S.C. § 1367, overruled the Supreme Court's decision in Zahn v. Int'l Paper Co., 414 U.S. 291, 301 94 S.Ct. 505, 38 L.Ed.2d 511 (1973), which held that claims of any plaintiff in a class action that failed to satisfy the requisite jurisdictional amount under 28 U.S.C. § 1332 must be dismissed from the case. Olden, 383 F.3d at 506-07.² The question before the Sixth Circuit in Olden was whether 28 U.S.C. § 1367 authorizes supplemental jurisdiction over the claims of class members that do not meet the amount-in-controversy threshold. The issue was not whether original diversity jurisdiction under 28 U.S.C. § 1332 was proper; the parties had already agreed that the district court had jurisdiction over the claims of the named plaintiffs. See Olden v. LaFarge Corp., 203 F.R.D. 254, 260 (E.D.Mich.2001).³ As the court in Johnson v. Micron Technology, Inc., 354 F.Supp.2d 736 (E.D.Mich.2005), explained:

The Olden opinion did not even address whether original jurisdiction was...