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Since enactment of the Class Action Fairness Act, Pub. L. 109-2, 119 Stat. 4 (2005), federal courts have been grappling with two major interpretative problems. As I discussed in my last column, federal courts have issued a significant universe of conflicting decisions relating to the retroactive application of the statute to class action pending at the time President Bush signed the bill. CAFA SHIFTS THE JURISDICTIONAL BURDEN The second major issue that has emerged relating to CAFA concerns which party carries the burden of proof of jurisdictional facts in support of removal jurisdiction. Similar to the retroactivity problem, courts have divergent views concerning which party carries the burden of jurisdictional proof on removal of a state class action to federal court under CAFA. As is well known, CAFA applies to and became effective for all class actions “commenced on or after” Feb. 18, 2005. Pub. L. 109-2, �9. CAFA creates new original diversity jurisdiction for class actions that plaintiffs chose to initiate indirectly in federal court. See 28 U.S.C. 1332(d). In addition, CAFA also created a new removal statute that permits defendant who are sued in state court to remove state class actions into federal court. See 28 U.S.C. 1453. Before the enactment of CAFA, a defendant who removed a case from state court into federal court carried the burden of establishing proper federal court jurisdiction for the removal, either under federal question jurisdiction, or federal diversity jurisdiction. See 28 U.S.C. 1331, 1332. This allocation of the burden of proof on removal jurisdiction was consistent with the long-standing hornbook rule that the party that invokes the jurisdiction of the court carries the burden of proving appropriate federal jurisdiction. See, e.g., Doe v. Allied Signal Inc., 985 F.2d 908, 911 (9th Cir. 1993); Ethridge v. Harbor House Rest., 861 F.2d 1389, 1393 (9th Cir. 1988). Since the enactment of CAFA, federal district courts have split concerning which party carries the burden of proving jurisdiction upon a CAFA removal. Several federal district courts have concluded that, contrary to the hornbook removal rule, CAFA shifts the jurisdictional burden to the state court plaintiffs, rather than the removing defendant. Recently, the 7th U.S. Circuit Court of Appeals has decided to the contrary, holding that the CAFA removal provisions do not shift the burden of jurisdictional proof. See Brill v. Countrywide Home Loans Inc., 427 F.3d 446 (2005). Perhaps the leading case that concludes that CAFA shifts the jurisdictional burden of proof to the remanding plaintiff is a decision authored by Judge Alicemarie H. Stotler in the Central District of California. See Berry v. Am. Express Publ’g Corp., 2005 U.S. Dist. Lexis 15514, No. 05-0302 (June 16, 2005). In Berry, Stotler relied on CAFA’s legislative history, in the Senate committee report, to conclude that CAFA shifted the burden of proof to the party seeking remand. CAFA provides a number of exceptions to federal jurisdiction for various state class actions, depending on the facts underlying the proposed action, such as the locality of the parties, the small number of claimants, or other discretionary factors. The Senate committee report states: “It is the Committee’s intention that with regard to each of these exceptions that the party opposing federal jurisdiction shall have the burden of demonstrating the application of an exemption. Thus, if a plaintiff seeks to have a class action remanded … that plaintiff shall have the burden of demonstrating that those criteria are met by the lawsuit.” See Judiciary Committee Report on Class Action Fairness Act, S. Rep. No. 109-14, at 42-44 (1st Sess. 2005), reprinted in 2005 U.S.C.C.A.N. 3, 2005 WL 627977. The CAFA removal provisions make no textual mention of which party carries the burden of proving jurisdictional facts. In this absence, Stotler held that it was legitimate for the court to make recourse to the clear legislative intent that the burden is shifted to the remanding plaintiff. Stotler stated: “[T]he Committee Report expresses a clear intention to place the burden of removal on the party opposing removal to demonstrate that an interstate class action should be remanded to state court.” Berry, id. at 7-8. OTHER FEDERAL DISTRICT COURTS REACH CONCLUSIONS ON CAFA Other federal district courts in Washington state and New Jersey have reached similar conclusions that CAFA intended and enacted a shift in the burden of jurisdictional proof. See Harvey v. Blockbuster Inc., 2005 U.S. Dist. Lexis 16446, 6 (D.N.J. Aug. 8, 2005); Waitt v. Merck & Co. Inc., 2005 WL 1799740 (W.D. Wash. July 27, 2005). Through October 2005, approximately a dozen district courts had reached similar conclusions that CAFA shifted the burden of proof to the remanding plaintiff. See Brill, 427 F.3d 446, 2005 U.S. App. Lexis 222514, 5 (7th Cir. 2005). In the Blockbuster case, the New Jersey court simply noted: “But it appears that the party opposing removal under Section 1332 (d) bears the initial burden of demonstrating that an action should be remanded.” The court cited both the Senate report and statements by representatives F. James Sensenbrenner Jr., R-Wis., and Robert Goodlatte, R-Va., in the Congressional Record. See 151 Cong. Rec. H72723-01, at H727, H732 (2005). In the Merck litigation, the Washington court sided with the defendant, holding that it is the plaintiff’s responsibility to demonstrate that removal from state court was improvident. The court declared: “notwithstanding the absence of explicit statutory provisions, it is not difficult to divine Congressional intent from CAFA’s legislative history.” Waitt, 2004 WL 1799740, 2. Other federal courts have taken vehement exception to the conclusion that CAFA shifts the burden of proving jurisdiction on removal to the remanding plaintiff. In a lengthy opinion discussing the appropriate usage of legislative history to aid in statutory construction, Judge J. O’Neill Jr. of the Eastern District of Pennsylvania took Stotler to task for her recourse to the CAFA Senate report to decide the question relating to burden shifting. Schwartz v. Comcast Corp., 2005 U.S. Dist. Lexis 15396, 20 (E.D. Pa. July 29, 2005). In O’Neill’s view, recourse to legislative history as an aid to statutory construction is appropriate and justified only where the face of a legislative act is ambiguous. O’Neill declared: “I do not find Section 1332(d) to be ambiguous and or to produce an absurd result because it is consistent with the Courts’ long standing application of the burden of proof for establishing diversity jurisdiction.” Schwartz, id. O’Neill also invoked the principle that the Supreme Court has frequently held that Congress is presumed to be aware of existing law when it passes legislation. Congress, therefore, could not have been unaware that courts uniformly place the burden of jurisdictional proof on the removing defendant. Schwartz, id. at 22. Finally, the court noted that if Congress had intended to change the law with respect to the burden of proof, it would have done so expressly in the statute. Schwartz, id. at 24-25. 7TH CIRCUIT THE FIRST TO WEIGH IN ON BURDEN This October, the 7th Circuit became the first circuit court to weigh in on the debate over allocation of the burden of proof upon removal, declaring that CAFA did not change the long-standing rule. Brill v. Countryside Home Loans Inc., 427 F.3d 446 (7th Cir. 2005). In an opinion authored by Judge Frank H. Easterbrook, the court opined that mere “naked legislative history has no legal effect.” Brill, 2005 U.S. App. Lexis 222514, 5, Citing Pierce v. Underwood, 487 U.S. 552, 566-68 (1988). Easterbrook noted that in that case, “A Committee of Congress attempted to alter an established legal rule by a forceful declaration in a report; the Justices concluded, however, that because the declaration did not correspond to any new statutory language that would change the rule, it was ineffectual. Just so here. The rule that the proponent of federal jurisdiction bears the risk of non-persuasion has been around a long time. To change the rule, Congress must enact a statute with the President’s signature … .A declaration by thirteen Senators will not serve.” Brill, id. Simply put, the implications of a change in the burden-shifting rule does have an impact on forum access. A shifted burden rule generally will favor defendants’ opportunity to remove state class actions into federal court, and will place an often onerous burden on state court plaintiffs to demonstrate that the case doesn’t belong there. The burden-shifting issue ultimately will distill into a debate over the appropriate use of legislative history as an aid to statutory construction. Because the 7th Circuit is the only federal circuit to have opined on this issue, the burden-shifting problem is certain to continue to percolate in the lower federal courts. Linda S. Mullenix holds the Morris and Rita Atlas Chair in Advocacy, University of Texas School of Law. She can be reached at [email protected].

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