Mississippi ex rel. Hood v. Au Optronics Corp.

• Citation: 187 L.Ed.2d 654,134 S.Ct. 736,82 USLW 4056
• Decision Date: 14 January 2014
• Docket Number: No. 12–1036.,12–1036.
• Parties: MISSISSIPPI ex rel. Jim HOOD, Attorney General, Petitioner v. AU OPTRONICS CORPORATION et al.
• Court: United States Supreme Court

134 S.Ct. 736
187 L.Ed.2d 654
82 USLW 4056

MISSISSIPPI ex rel. Jim HOOD, Attorney General, Petitioner
v.
AU OPTRONICS CORPORATION et al.

No. 12–1036.

Supreme Court of the United States

Argued Nov. 6, 2013.
Decided Jan. 14, 2014.

Syllabus^*

Congress enacted the Class Action Fairness Act of 2005 (CAFA) to lower

[134 S.Ct. 737]

diversity jurisdiction requirements in class actions and, as relevant here, in mass actions, i.e., civil actions “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,” 28 U.S.C. § 1332(d)(11)(B)(i). Petitioner Mississippi sued respondent liquid crystal display (LCD) manufacturers in state court, alleging violations of state law and seeking, inter alia, restitution for LCD purchases made by itself and its citizens. Respondents sought to remove the case to federal court. The District Court held that the suit qualified as a mass action under § 1332(d)(11)(B)(i), but remanded the suit to state court on the ground that it fell within CAFA's “general public” exception, § 1332(d)(11)(B)(ii)(III). The Fifth Circuit reversed, agreeing with the District Court that the suit was a mass action but finding the general public exception inapplicable.

Held : Because Mississippi is the only named plaintiff, this suit does not constitute a mass action under CAFA. Pp. 741 – 746.

(a) Contrary to respondents' argument, CAFA's “100 or more persons” phrase does not encompass unnamed persons who are real parties in interest to claims brought by named plaintiffs. Congress knew how to draft language to that effect when it intended such a meaning, see, e.g.,§§ 1332(d)(5)(B), 1332(d)(1)(D). That it did not do so in the mass action provision indicates that Congress did not want the provision's numerosity requirement to be satisfied by counting unnamed individuals who possess an interest in the suit.

Respondents' understanding also cannot be reconciled with the fact that the “100 or more persons” are not unspecified individuals with no participation in the suit but are the “plaintiffs” subsequently referred to in the provision, i.e., the very parties proposing to join their claims in a single trial. This is evident in two key ways. First, CAFA uses “persons” and “plaintiffs” the same way they are used in Federal Rule of Civil Procedure 20, which refers to “persons” as individuals who are proposing to join as “plaintiffs” in a single action. Second, it is difficult to imagine how the “claims of 100 or more” unnamed individuals could be “proposed to be tried jointly on the ground that the ... claims” of some completely different group of named plaintiffs “involve common questions of law or fact.”

Construing “plaintiffs” to include both named and unnamed real parties in interest would stretch the meaning of “plaintiff” beyond recognition. A “plaintiff” is commonly understood to be a party who brings a civil suit in a court of law, not anyone, named or unnamed, whom a suit may benefit. Moreover, respondents' definition would also have to apply to the mass action provision's subsequent reference to “plaintiffs” in the phrase “jurisdiction shall exist only over those plaintiffs whose claims [exceed $75,000],” § 1332(d)(11)(B)(i). See Brown v. Gardner, 513 U.S. 115, 118, 115 S.Ct. 552, 130 L.Ed.2d 462. This would result in an administrative nightmare that Congress could not possibly have intended, see Griffin v. Oceanic Contractors, Inc., 458 U.S. 564, 575, 102 S.Ct. 3245, 73 L.Ed.2d 973, where district courts would have to identify hundreds (or in this case, hundreds of thousands) of unnamed parties whose claims are for less than $75,000 and then decide how to dispose of their claims. Pp. 741 – 744.

[134 S.Ct. 738]

(b) Statutory context reinforces this Court's reading of the mass action provision. CAFA provides that once removal occurs, a case shall not be transferred to another court “unless a majority of the plaintiffs in the action request transfer.” § 1332(d)(11)(C)(i). If “plaintiffs” included unnamed parties, it would be surpassingly difficult for a court to poll the enormous number of real parties in interest to decide whether an action may be transferred. Moreover, respondents' position that the action here should be removed because it is similar to a class action fails to recognize that the mass action provision functions largely as a backstop to ensure that CAFA's relaxed class action jurisdictional rules cannot be evaded by a suit that names a host of plaintiffs rather than using the class device. Had Congress wanted CAFA to authorize removal of representative actions brought by States as sole plaintiffs on respondents' theory, it would have done so through the class action provision, not the mass action provision. Pp. 744 – 745.

(c) This Court has interpreted the diversity jurisdiction statute to require courts in certain contexts to look behind the pleadings to ensure that parties are not improperly creating or destroying diversity jurisdiction, see, e.g.,Wecker v. National Enameling & Stamping Co., 204 U.S. 176, 185–186, 27 S.Ct. 184, 51 L.Ed. 430, but Congress did not intend this background inquiry to apply to the mass action provision. First, it could make sense to incorporate the background inquiry into the mass action provision if the inquiry had previously been applied in a similar manner. That is not the case here, however, and so any presumption that Congress wanted to incorporate the inquiry, if it exists at all, would be comparatively weak. Second, even if the background principle had previously been applied in this manner, Congress expressly indicated that it did not want the principle to apply to the mass action provision both through the textual indicators described above and by prohibiting defendants from joining unnamed individuals to a lawsuit in order to turn it into a mass action, § 1332(d)(11)(B)(ii)(II). Requiring district courts to identify unnamed persons interested in the suit would run afoul of that intent. Pp. 744 – 746.

701 F.3d 796, reversed and remanded.

SOTOMAYOR, J., delivered the opinion for a unanimous Court.

Jonathan S. Massey, Washington, DC, for Petitioner.

Christopher M. Curran, Washington, DC, for Respondents.

Jonathan Massey, Massey & Gail LLP, Counsel of Record, Washington, DC, Jim Hood, Attorney General for the State of Mississippi, Geoffrey Morgan, George W. Neville, Office of the Mississippi, Attorney General, Jackson, MS, A. Lee Abraham, Jr., Preston Rideout, Abraham & Rideout, Greenwood, MS, Carolyn G. Anderson, David M. Cialkowski, Patricia A. Bloodgood, June P. Hoidal, Zimmerman Reed PLLP, Minneapolis, MN, for Petitioner.

Martin M. Toto, John H. Chung, Ross E. Elfand, White & Case LLP, New York, NY, Christopher M. Curran, Counsel of Record, Eric Grannon, Kristen J. McAhren, White & Case LLP, Washington, DC, for the Toshiba Respondents, Toshiba Corporation, Toshiba America Information Systems, Inc., Toshiba America Electronic Components, Inc., and Toshiba Mobile Display Co., Ltd.

Charles E. Ross, Michael B. Wallace, Rebecca Hawkins, Wise Carter Child & Caraway, P.A., Jackson, MS, Additional Counsel for the Toshiba Respondents.

[134 S.Ct. 739]

Christopher A. Nedeau, Carl L. Blumenstein, Nossaman, LLP, San Francisco, CA, James W. Shelson, Phelps Dunbar LLP, Jackson, MS, for Respondents AU Optronics Corporation and AU Optronics Corporation America.

Robert E. Freitas, Jason S. Angell, Jessica N. Leal, Freitas Tseng & Kaufman LLP, Redwood Shores, CA, for Respondent HannStar Display Corporation.

Christopher B. Hockett, Neal A. Potischman, Davis Polk & Wardwell LLP, Menlo Park, CA, Stephen L. Thomas, Bradley Arant Boult, Cummings LLP, Jackson, MS, for Respondents Chi Mei Corporation, Chimei Innolux Corporation, Chi Mei Optoelectronics USA, Inc., and CMO Japan Co., Ltd.

Stephen B. Kinnaird, Kevin C. McCann, Lee F. Berger, Sean D. Unger, Paul Hastings LLP, Washington, DC, Robert A. Miller, P. Ryan Beckett, Butler, Snow, O'Mara, Stevens and Cannada, PLLC, Ridgeland, MS, Henry L. Parr, Jr., Wyche, P.A., Greenville, SC, for Respondents LG Display Co., Ltd. and LG Display America, Inc.

Robert A. Long, Robert D. Wick, Covington & Burling LLP, Washington, DC, for Respondents Samsung Electronics America, Inc., Samsung Electronics Co., Ltd., and Samsung Semiconductor, Inc.

John M. Grenfell, Jacob R. Sorensen, Pillsbury Winthrop Shaw Pittman LLP, San Francisco, CA, for Respondents Sharp Corporation and Sharp Electronics Corporation.

Justice SOTOMAYOR delivered the opinion of the Court.

Under the Class Action Fairness Act of 2005 (CAFA or Act), defendants in civil suits may remove “mass actions” from state to federal court. CAFA defines a...