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Signed into law by President Bush on Feb. 18, the Class Action Fairness Act of 2005 (CAFA) provides expanded federal jurisdiction over class actions. This column takes a look at the first reported CAFA cases. Two appellate court decisions and a district court opinion have dealt with the important initial question of whether the act applies to a particular case. As we will see, the appellate cases also involve an unintended thorny appellate jurisdiction issue. CAFA provides that the act is applicable to cases commenced on or after the date of its enactment, Feb. 18. Nonetheless, some defendants have tested this seemingly straightforward provision. In Pritchett v. Office Depot Inc., 404 F.3d 1232 (10th Cir. 2005), the plaintiff filed a class action on April 2, 2003, against Office Depot in a Colorado state court. On June 21, 2004, the state court certified a class, and set a trial date of March 14, 2005. On March 1, 2005, Office Depot removed the action to the U.S. District Court for the District of Colorado, invoking the newly-enacted provisions in 28 U.S.C. 1332(d), which provides for expanded diversity jurisdiction, and � 1453, which provides for expanded removal rights. The plaintiff moved to remand the case to state court, arguing that CAFA did not apply to actions already pending in state courts, and the district court agreed, remanding the case to the state court. Appellate jurisdiction over remand orders Office Depot filed a petition for leave to appeal the district court’s remand order under CAFA’s newly enacted appellate jurisdiction provision, 28 U.S.C. 1453(c). This provision enables defendants frustrated by a remand order to seek appellate review that otherwise would be impermissible under the regular removal procedures. Section 1447 generally prohibits appellate review of remand orders. In the class action and mass action context, however, � 1453(c) now provides for discretionary appellate review. The 10th U.S. Circuit Court of Appeals began its analysis, as it should have, with the jurisdictional issue. First, it dealt with a timing question, noting that � 1453(c) allows for discretionary appeal “provided that the appeal is taken within seven days of the remand order.” 404 F.3d 1234. Since Office Depot’s petition for leave to appeal was filed within seven days of the remand order, it was timely, according to the 10th Circuit. However, the parties in the Office Depot case, as well as the 10th Circuit, missed what appears to be a serious drafting flaw in CAFA. Section 1453(c)(1) provides for discretionary appellate review “if application is made to the court of appeals not less than 7 days after entry of the order [granting or denying a remand].” The 10th Circuit read the provision as requiring that the petition be filed “not more than” seven days after entry of the remand order. Surely Congress intended that an appeal be taken sooner rather than later, and intended that appeals be filed within seven days of the remand order. Generally, Congress sets forth the outside date for taking an appeal, and does not impose a waiting period for taking an appeal. Moreover, � 1453 requires the appellate courts to render a decision within a short time frame. Thus, it appears that Congress wants the forum-selection battle to end sooner rather than later, and does not want the litigants to play jurisdictional games. The language, however, provides otherwise. What should other courts do? Normally, a court would look to the plain meaning of the statute. Here, although grammatically awkward, the words of the statute make it plain that an appeal may not be filed until “not less than 7 days” after entry of the order. This would mean that the party losing the motion to remand could keep litigating in federal court, see how things progress, and then file the appeal of the remand order when the tide turns against that party. A court could construe such a scenario as absurd, and therefore follow what Congress must have meant, rather than the plain meaning. On the other hand, maybe Congress did mean to leave the appeal period open-ended. The bottom line is that although the text is clear, how courts will read and interpret it is not. Practitioners must be careful here because missing the deadline, whatever it turns out to be, is likely to be considered a jurisdictional defect. The safe thing to do is to file within seven days after entry of the remand order. The 10th Circuit denied the petition for leave to appeal, nonetheless, because CAFA, including its discretionary-remand provision, � 1453(c), was inapplicable to the case. CAFA’s date of enactment was Feb. 18. The class action was filed almost two years earlier in state court. The defendant removed the case to federal court on March 1, 2005. Section 9 of CAFA provides: “The amendments made by this Act shall apply to any civil action commenced on or after the date of enactment of this Act.” Thus, the applicability of CAFA turns upon when the plaintiff’s class action was commenced: at the time the plaintiff filed the case in state court, or, as Office Depot argued for CAFA purposes, on the date Office Depot removed it. Looking to the text of CAFA, and traditional rules of statutory construction and rules pertaining to federal jurisdiction and procedure, the 10th Circuit correctly found that “a cause of action is commenced when it is first brought in an appropriate court, which here was when it was brought in state court.” The next part of the court’s analysis is interesting, however, given the political backdrop of CAFA. The 10th Circuit explained that federal jurisdictional statutes, particularly removal statutes, should be narrowly construed. To the extent that there is any ambiguity, a court should adopt a narrow construction, against federal jurisdiction. However, given the express intent of Congress in enacting CAFA to enlarge federal jurisdiction, one questions the relevance of the 10th Circuit’s narrow-construction approach. Perhaps the 10th Circuit did not intend to open a can of worms, but when courts interpret other provisions of CAFA in the coming months, it will be interesting to see whether they take the narrow-construction approach, or a jurisdiction-enlarging approach pursuant to what they see as Congress’ intent in enacting CAFA. The 10th Circuit itself was quite mindful of Congress’ intent, and even signaled that its approach in resolving other CAFA issues may be broader: “We are mindful of the fact that Congress’ goal in passing this legislation was to increase access to federal courts, and we also recognize that the Senate report instructs us to construe the bill’s terms broadly. But these general sentiments do not provide carte blanche for federal jurisdiction over a state class action any time the statute is ambiguous. While it is clear the Congress wished to expand federal jurisdiction, when that expansion is made effective is what is at issue in this case, and that is an issue we approach cautiously. 404 F.3d 1237 n.6 (citations omitted).” Indeed, the 10th Circuit itself looked to the legislative history of CAFA in reaching its result, finding that as the statute evolved, some of its more far-reaching provisions, including one that would have provided that CAFA would apply to pending cases, were rejected. The 7th Circuit concurs with 10th-mostly Adopting the 10th Circuit’s analysis, the 7th Circuit in Knudsen v. Liberty Mut. Ins. Co., 2005 U.S. App. Lexis 10440 (7th Cir. June 7), held that CAFA did not apply to a case filed in state court years before CAFA was enacted. The court found unavailing the defendant’s argument that any substantial change to the class definition “commences” a new case. The court explained that significance has nothing necessarily to do with whether there is 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.” Id. at *3-4. The 7th Circuit, however, was somewhat sympathetic to the defendants’ “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.” The solution to that possibility, however, can be found in current amendment/ statute of limitations cases. New claims for relief, or the addition of new defendants, or any other actions sufficiently distinct from the case as originally filed that the district courts would treat as independent for statute of limitations purposes, “could well commence a new piece of litigation for federal purposes even if it bears an old docket number for state purposes.” Id. at *4. For example, if a plaintiff amends a state court complaint to add a federal question claim, or adds a new defendant, the action becomes removable. The 7th Circuit stated: “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.” Id. at *4-5. Finally, in Lander & Berkowitz P.C. v. Transfirst Health Servs., 2005 U.S. Dist. Lexis 9604 (E.D. Mo. May 19), a class action was filed in Missouri state court on Feb. 17, the same day that Congress passed CAFA. The defendant argued that Congress enacts laws, and that because CAFA was enacted by Congress on Feb. 17, that CAFA’s removal provisions applied. Not surprisingly, the court rejected the argument, holding that the president’s signature is required to enact a law. The court, however, denied the plaintiff’s request for fees under � 1447(c) for the improper removal. Though the cases reviewed in this column involve, on the one hand, a relatively straightforward matter-the effective date of the act-they also demonstrate how problematic CAFA is likely to be, and presage the inventive strategies that attorneys are likely to make. Stay tuned. Georgene M. Vairo is a professor of law and William M. Rains Fellow at Loyola Law School, Los Angeles. She can be reached at [email protected].

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