C.D. Cal. Splits with 5th, 7th & 11th Circuits in Holding that Party Seeking Removal Has Burden of Establishing Inapplicability of CAFA Exceptions

Per Lao v. Wickes Furniture Co., Inc., 455 F.Supp.2d 1045 (C.D. Cal. Oct. 04, 2006):

The thornier issue is who bears the burden of proof with respect to the local controversy and home-state rule provisions contained in section 1332(d)(4), a question that has not been addressed by the Ninth Circuit.

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Other courts have accepted the analogy proffered by defendants and placed the burden on establishing (d)(4)'s provisions on the non-removing party. See Hart, 457 F.3d at 681 (holding "that the plaintiff has the burden of persuasion on the question whether the home-state or local controversy exceptions apply"); Frazier v. Pioneer Americas LLC, 455 F.3d 542, 546 (5th Cir.2006) (noting that the "longstanding § 1441(a) doctrine placing the burden on plaintiffs to show exceptions to jurisdiction" serves to "buttress[ ] the clear congressional intent to do the same with CAFA"); Evans v. Walter Indus., Inc., 449 F.3d 1159, 1165 (11th Cir.2006) (analogizing to Breuer, "we hold that the plaintiffs bear the burden of proving the local controversy exception to the jurisdiction otherwise established" by the provisions in (d)(2)). The Court is not convinced that such an analogy is appropriate.

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Accordingly, the Court finds, as a matter of statutory construction, the burden of proving the elements outlined in subsection (d)(4) falls on the removing party. This finding is not without consequence. Much of the information used by the Court in applying subsection (d)(4)'s provisions in this case, see infra, was tendered by defendant only after the Court noted its tentative ruling with respect to the burden of proof question. But for defendants' submission of this additional information, plaintiffs' motion to remand would have been wanting.