Knudsen v. Liberty Mut. Ins. Co.

• Decision Date: 07 June 2005
• Docket Number: No. 05-8010.,05-8010.
• Parties: Kirsten KNUDSEN, Chris Baker, and Vikki Baker, Plaintiffs-Respondents, v. LIBERTY MUTUAL INSURANCE COMPANY, Defendant-Petitioner.
• Court: U.S. Court of Appeals — Seventh Circuit

411 F.3d 805

Kirsten KNUDSEN, Chris Baker, and Vikki Baker, Plaintiffs-Respondents, v. LIBERTY MUTUAL INSURANCE COMPANY, Defendant-Petitioner.

No. 05-8010.

United States Court of Appeals, Seventh Circuit.

Submitted April 29, 2005.

Decided June 7, 2005.

Russell Yager, Vinson & Elkins, Dallas, TX, for Defendant-Petitioner.

William M. Sweetnam, Freed & Weiss, William J. Harte, Harte & Associates, Robert A. Holstein, Holstein Law Offices, Chicago, IL, for Respondents.

Before COFFEY, EASTERBROOK, and WILLIAMS, Circuit Judges.

EASTERBROOK, Circuit Judge.

The Class Action Fairness Act of 2005, Pub.L. 109-2, 119 Stat. 4 (2005), permits defendants to remove certain class actions to federal court if minimal diversity of citizenship exists. Section 9 tells us that it applies only to suits "commenced on or after the date of enactment of this Act." That date is February 18, 2005. Invoking the removal authority under § 5, codified at 28 U.S.C. § 1453, Liberty Mutual Insurance Company removed this class action, which had been pending in state court since March 2000. The district judge promptly sent it back, observing that March 2000 precedes February 2005. Now Liberty Mutual asks us to entertain an appeal, a step that § 1453(c)(1) allows notwithstanding the norm in 28 U.S.C. § 1447(d) that remand orders are not reviewable.

We deny this petition, for we agree with Pritchett v. Office Depot, Inc., 404 F.3d 1232 (10th Cir.2005), that § 9 of the new Act must be taken seriously. Deconstructionist tactics do not permit its evasion. The defendant in Pritchett contended that the notice of removal itself commenced a new case (the one in federal court). Rebuffing that effort to sidestep the legislative decision, Pritchett concluded that a civil action is "commenced" for purposes of § 9 when it is filed in state court and not when some later step occurs in its prosecution. Equating filing with commencement is the norm in civil practice. See Fed.R.Civ.P. 3. Although there are a few exceptions — for example, a litigant who seeks to proceed in forma pauperis may be unable to get the suit under way until the judge accepts the complaint and authorizes service on the defendants, see Williams-Guice v. Board of Educ. of City of Chicago, 45 F.3d 161 (7th Cir.1995) — none applies here. This suit against Liberty Mutual has been ongoing for years.

Instead of arguing that removal equals "commencement," Liberty Mutual contends that any substantial change to the class definition "commences" a new case. Now as a matter of normal language (and normal legal practice) a new development in a pending suit no more commences a new suit than does its removal. Plaintiffs routinely amend their complaints, and proposed class definitions, without any suggestion that they have restarted the suit — for a restart (like a genuinely new claim) would enable the defendant to assert the statute of limitations. Liberty Mutual concedes that routine changes do not allow removal but insists that a "substantial" or "significant" change must do so. Yet significance is not the measure of a new claim; a plaintiff may assert an entirely novel legal theory in midsuit without creating a "new" claim in the sense that the defendant could block it by asserting that it had been propounded after the period of limitations expired. Moreover, "significance" often lies in the eye of the beholder; it is not a rule of law so much as it is a cast of mind or an assessment of likely consequences, which may be difficult if not impossible to foresee. A doctrine of "significant change" thus would go against the principle that the first virtue of any jurisdictional rule is clarity and ease of implementation. See, e.g., Budinich v. Becton Dickinson & Co., 486 U.S. 196, 202-03, 108 S.Ct. 1717, 100 L.Ed.2d 178 (1988); Hoagland v. Sandberg, Phoenix & von Gontard, P.C., 385 F.3d 737, 740 (7th Cir.2004) (collecting authority).

Liberty Mutual paints a picture of crafty lawyers tending a garden of pre-2005 class actions, in which they plant new claims by amendment so that the 2005 Act never comes into play. As we have already hinted, however, a new claim for relief (a new "cause of action" in state practice), the addition of a new defendant, or any other step sufficiently distinct that courts would treat it as independent for limitations purposes, could well commence a new piece of litigation for federal purposes even if it bears an old docket number for state purposes. Removal practice recognizes this point: an amendment to the pleadings that adds a claim under federal law (where only state claims had been framed before), or adds a new defendant, opens a new window of removal. 28 U.S.C. § 1446(b). See Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, 14C Federal Practice & Procedure § 3732 at 311-48 (3d ed.1998). We imagine, though we need not hold, that a similar approach will apply under the 2005 Act, perhaps modeled on Fed.R.Civ.P. 15(c), which specifies when a claim relates back to the original complaint (and hence is treated as part of the original suit) and when it is sufficiently independent of the original contentions that it must be treated as fresh litigation. See also Schiavone v. Fortune, 477 U.S. 21, 106 S.Ct. 2379, 91 L.Ed.2d 18 (1986); Arendt v. Vetta Sports, Inc., 99 F.3d 231 (7th Cir.1996). This possibility does Liberty Mutual no...