Besse v. General Motors Corp.

• Decision Date: 05 May 2004
• Docket Number: No. 2:04-0710.,2:04-0710.
• Citation: 317 F.Supp.2d 646
• Parties: Jason BESSE, on behalf of himself and all others similarly situated, Plaintiff, v. GENERAL MOTORS CORPORATION, Defendant.
• Court: U.S. District Court — District of South Carolina

317 F.Supp.2d 646

Jason BESSE, on behalf of himself and all others similarly situated, Plaintiff, v. GENERAL MOTORS CORPORATION, Defendant.

No. 2:04-0710.

United States District Court, D. South Carolina, Charleston Division.

May 5, 2004.

Charles S. Altman, Meredith N. Long, Finkel and Altman, Charleston, SC, for Plaintiff.

Wade H. Logan, III, Daniel A. Nussbaum, Nelson Mullins Riley and Scarborough, Charleston, SC, for Defendant.

ORDER

DUFFY, District Judge.

This matter is before the court upon Plaintiff¹ Jason Besse's ("Besse") Motion to Remand. For the reasons set forth herein, Plaintiff's motion is granted.

BACKGROUND

On January 29, 2004, Plaintiff filed this purported class action in the Court of Common Pleas for Dorchester County, South Carolina on behalf of himself and all others similarly situated. Plaintiff asserts various warranty claims regarding Defendant's allegedly defective construction of engines with a "piston slap" problem. "Piston slap" apparently results when too much clearance is left between the piston and the cylinder walls within the cylinder bore of the engine. (Comp.¶ 2). This clearance allows the piston to move around inside the engine, causing a knocking sound and damage to the engine. Id. Plaintiff suggests that engines with piston slap both waste fuel and have significantly higher vehicle emissions. (Comp.¶ 27). These two problems get significantly worse as miles accrue on the vehicle. (Comp.¶ 28). Plaintiff contends that oil analysis samples from engines with piston slap exhibit extremely high levels of wear-related materials and deteriorating power and performance. (Comp.¶ 29).

Plaintiff estimates that piston slap occurs in hundreds of thousands of Defendant's engines, and that accordingly, some 800,000 vehicles have higher emissions than they should. (Comp.¶ 2). Plaintiff contends that Defendant first promised consumers it would remedy the piston slap problem in December of 2001 and January of 2002, but later reneged on this promise and classified the piston slap problem as "normal" and not worth repairing. (Comp.¶ , ¶ 23-26). Plaintiff seeks compensatory, incidental, and consequential damages for the alleged breaches of warranty.

ANALYSIS

In order for removal jurisdiction to exist, a federal court must have original jurisdiction. See 28 U.S.C. § 1441(a). "It is elementary that the burden is on the party asserting jurisdiction to demonstrate that jurisdiction does, in fact, exist." Lovern v. Edwards, 190 F.3d 648, 654 (4th Cir.1999); Mulcahey v. Columbia Organic Chems. Co., 29 F.3d 148, 151 (4th Cir.1994). "Typically, an action initiated in a state court can be removed to federal court only if it might have been brought in federal court originally." Sonoco Prods. Co. v. Physicians Health Plan, Inc., 338 F.3d 366, 370 (4th Cir.2003). Courts construe removal statutes narrowly. Schlumberger Indus., Inc. v. Nat'l Sur. Corp., 36 F.3d 1274, 1284 (4th Cir.1994). "[C]ourts should resolve all doubts about the propriety of removal in favor of retained state court jurisdiction." Hartley v. CSX Transp., Inc., 187 F.3d 422, 425 (4th Cir.1999); see also Mulcahey, 29 F.3d at 151 ("If federal jurisdiction is doubtful, a remand is necessary.").

Defendant removed this case based on 1) diversity jurisdiction under 28 U.S.C. § 1332, and 2) "arising under" jurisdiction under 28 U.S.C. § 1331.² The court will address each basis for removal in turn.

I. Diversity Jurisdiction as a Grounds for Removal

Plaintiff is a resident of Summerville, South Carolina, while Defendant General Motors ("GM") is a Delaware corporation with its principal place of business in Michigan. (Notice of Removal, ¶ 4). Thus, the only question for purposes of § 1332 is whether the "matter in controversy exceeds $75,000, exclusive of interests and costs." 28 U.S.C. § 1332.

Generally, if a class action involves "separate and distinct claims by two or more plaintiffs, the determination of the amount in controversy is based upon each plaintiff's claims and not upon the aggregate." Glover v. Johns-Manville Corp., 662 F.2d 225, 231 (4th Cir.1981) (citing Zahn v. Int'l Paper Co., 414 U.S. 291, 293-96, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973)). However, in Rosmer v. Pfizer, 263 F.3d 110 (4th Cir.2001), the Fourth Circuit clarified that if a named plaintiff has a claim exceeding $75,000, then the court possesses subject matter jurisdiction over all other class members based on supplemental jurisdiction under 28 U.S.C. § 1367. Thus, under controlling Fourth Circuit law, the amount in controversy requirement is met in a class action if any named plaintiffs has a claim exceeding $75,000. See, e.g., Virden v. Altria Group, 304 F.Supp.2d 832, 847 (N.D.W.Va.2004) ("Although the individual claims of a class of plaintiffs are not `aggregated,' the Fourth Circuit has interpreted the supplemental jurisdiction statute to provide federal jurisdiction over the claims of all plaintiffs if a defendant can establish that the court has jurisdiction over the claims of any named plaintiff."); Jones v. Allstate Ins. Co., 258 F.Supp.2d 424 (D.S.C.2003) ("[U]nder Zahn, as interpreted by Rosmer, the requisite amount in controversy for diversity jurisdiction is met in a class action if at least one of the named plaintiffs has a claim exceeding $75,000.").

Here, Plaintiff has specifically averred that neither he nor any of his proposed class members have claims in excess of $75,000. (Comp.¶ 7). Normally, the sum claimed by a plaintiff in his complaint determines whether the amount in controversy requirement is satisfied, and a plaintiff may choose to seek less than $75,000 to avoid federal court. See, e.g., St Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 294, 58 S.Ct. 586, 82 L.Ed. 845 (1938) ("If [the plaintiff] does not desire to try his case in the federal court he may resort to the expedient of suing for less than the jurisdictional amount, and though he would be justly entitled to more, the defendant cannot remove."); Wright & Miller, 14A Federal Practice and Procedure § 3702 ("Plaintiff is the master of his or her own claim; if plaintiff chooses to ask for less than the jurisdictional amount, only the sum actually demanded is in controversy."). Nonetheless, Defendant attempts to remove on the basis that (1) the general rule of non-aggregation is "subject to the common fund exception" which allows aggregation of class members' claims to reach the jurisdictional amount "where two or more plaintiffs unite to enforce a single title or right in which they have a common and undivided interest;" and (2) Plaintiff implicitly seeks injunctive relief which would cost GM far in excess of $75,000 (Notice of Removal, ¶ , ¶ 5, 6) (internal citations omitted).

A. Common Fund Exception to the Non-Aggregation Rule

Under the common fund exception to the non-aggregation rule, "[a]ggregation is permitted ... where `two or more plaintiffs unite to enforce a single title or right in which they have a common and undivided interest.'" Glover v. Johns-Manville Corp., 662 F.2d 225, 231 (4th Cir.1981) (quoting Snyder v. Harris, 394 U.S. 332, 335, 89 S.Ct. 1053, 22 L.Ed.2d 319 (1969)). Defendant contends that Plaintiff's Complaint "seeks the establishment of a common fund" and that "[b]y this pleading, Plaintiff and the putative class members assert a common and undivided interest because the effect would be to deter (or prohibit) the course of conduct as a whole." (Def. Mem. at 12). Plaintiff counters that this exception does not apply, as "[t]his [c]ourt and the Fourth Circuit have rendered decisions ... [which] instruct that rights that arise under similar circumstances do not necessarily have the `undivided' interest that is a necessary predicate to aggregation." (Pl. Mem at 8).

Aggregation is appropriate "only when several parties have a common, undivided interest and a single title or right is involved." Gilman v. BHC Securities, Inc., 104 F.3d 1418, 1422 (2d Cir.1997) (internal citations omitted). "[I]t is the nature of the right asserted, not that of the relief requested, that determines whether the claims of multiple plaintiffs will be aggregated." Jones v. Allstate Ins. Co., 258 F.Supp.2d 424, 431 (D.S.C.2003) (quoting Morrison v. Allstate Indem. Co., 228 F.3d 1255, 1264 (11th Cir.2000)). Stated differently, "the paradigm cases allowing aggregation of claims are those which involve a single indivisible res, such as an estate, a piece of property[,] ... or an insurance policy." Id."These are matters that cannot be adjudicated without implicating the rights of everyone involved with the res." Bishop v. General Motors Corp., 925 F.Supp. 294, 298 (D.N.J.1996). For the sake of reference, the following are types of cases where aggregation has been allowed:

An action by the assignees of two promissory notes to enforce their `common and undivided interest' in a vendors' lien that served as the common security for the payment of both notes; an action by members of an Indian tribe to quiet title to what was essentially a single tract of land ... but which was held by several individual defendants; an action on a fire insurance policy, filed jointly by a debtor and the nine creditors to whom he had partially assigned his claims to the insurance proceeds; an action by several members of the same family to secure family social services ...; and an action against a majority shareholder for breach of fiduciary duty, brought by minority shareholders who held a common and undivided interest in the corporation's assets.

Gilman, 104 F.3d at 1423.

Plaintiff correctly asserts that in Glover, the Fourth Circuit held that claims arising under similar circumstances do not necessarily mean that aggregation is appropriate. 662 F.2d at 231. There, the Fourth Circuit held that the district court had improperly aggregated the contractual claims asserted by manufacturers of asbestos-based insulation products because those claims did not give rise to an undivided...