Thursday, February 01, 2007

S.D.N.Y. Discusses Numerosity Requirement; Finds Lack of Subject Matter Jurisdiction

Per McGaughey v. Treistman, 2007 WL 24935 (S.D.N.Y. Jan. 4, 2007):

Plaintiff Lawrence McGaughey (“Plaintiff” or “McGaughey”) has brought this putative class action against Defendant Richard Treistman (“Defendant” or “Treistman”) pursuant to the federal Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227 et. seq., that provides for statutory damages against those who send unsolicited “junk” faxes. Plaintiff has moved for class certification. Defendant has cross-moved for summary judgment. Because Plaintiff does not meet the requirements of Fed.R.Civ.P. 23(a) for class certification, I am denying Plaintiff's motion for class certification. Because denial of class certification leaves this Court without subject matter jurisdiction, it is unnecessary to decide Defendant's motion for summary judgment and dismissal for lack of subject matter jurisdiction is mandated. . . .

Plaintiff's motion for class certification fails because Plaintiff has not met the numerosity requirement of Rule 23(a). . . . Following the Second Circuit's recent clarification of the standards to be employed in determining Rule 23 motions, I must make individualized determinations for each Rule 23 category, and I may look beyond the pleadings in doing so. See In re Initial Pub. Offering Sec. Litig., 2006 U.S.App. LEXIS 29859, at *52 (”[T]he district judge must receive enough evidence, by affidavits, documents, or testimony, to be satisfied that each Rule 23 requirement is met.). However, on the pleadings or otherwise, Plaintiff here appears to be a potential class of one. Although Plaintiff has been given the opportunity to conduct discovery regarding class certification-as well as an extension of discovery on that issue, at Plaintiff's request-Plaintiff has provided no evidence that either Defendant or N.Y. Essex has ever sent more than one fax arguably in violation of the TCPA, and that one to this Plaintiff. See Weiss v. Fein, Such, Kahn & Shepard, P.C., 2002 U.S. Dist. LEXIS 4783, at *5-6 (S . D.N.Y.2002) . . . Plaintiff has failed to meet his burden to satisfy the Rule 23(a) requirement of numerosity. Because Plaintiff has failed to meet this burden, it is unnecessary for me to consider the remaining Rule 23 requirements.

Plaintiff originally asserted that this Court possessed subject matter jurisdiction over this action pursuant to the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2)(A). Pl. Complaint, ¶ 3. This Court would alternatively possess subject matter over this action pursuant to the general federal diversity statute, 28 U.S.C. § 1332(a). Plaintiff is required to rely on § 1332 for subject matter jurisdiction because the TCPA is the rare federal statute that does not provide federal question jurisdiction. Gottlieb v. Carnival Corp., 436 F.3d 335, 337 (2d. Cir.2006), citing Foxhall Realty Law Offices, Inc. v. Telecommunications Premium Services, Ltd., 156 F.3d 432 (2d Cir.1998). However, Plaintiff's two possible grounds for establishing subject matter jurisdiction over this action no longer exist. Because Plaintiff's motion for class certification must be denied, Plaintiff's action is no longer a class action, and this Court cannot retain subject matter jurisdiction in diversity over Plaintiff's action pursuant to the Class Action Fairness Act. See 28 U.S.C. § 1332(d)(2). Because Plaintiff has failed to put forth a single fact relevant to his remaining individual action against Defendant that meets the $75,000 amount-in-controversy requirement of 28 U.S.C. § 1332(a), this Court loses subject matter jurisdiction over Plaintiff's individual action pursuant to the general federal diversity statute. See Gottlieb v. Carnival Corp., 436 F.3d 335, 343 n.10 (“In order to meet the amount-in-controversy requirement, a single plaintiff would have to receive either 150 faxes from a single defendant, assuming $500 in statutory damages per fax, or 50 faxes from that defendant, assuming treble damages.”). Plaintiff's action therefore must be dismissed for lack of subject matter jurisdiction.


At 5:22 PM, Anonymous Anonymous said...

Is this result right? Isn't jurisdiction in a removed case determined at the time of the removal? At that time, the case was a putative class action and removal was proper. The definition of class action in CAFA refers to the status of the case at the time of filing:

the term "class action" means any civil action filed under rule 23 of the Federal Rules of Civil Procedure or similar State statute or rule of judicial procedure authorizing an action to be brought by 1 or more representative persons as a class action;

How is the result the court reached in this case any different from saying that because a defense exists on the merits, the amount in controversy requirement is not satisfied? Am I missing something obvious?

At 10:11 PM, Blogger Lonny Hoffman said...

plaintiff sought to invoke fed jur here by initiating suit in fed court. the TCPA is not an independt grant of jurisdiction so the only way pl could maintain the suit in fed court was by virtue of bringing a class suit within the original jurisdiction conferred by CAFA. Because Judge Baer rules that the min AIC is not met, he finds that the case is not a "class action" within the meaning of the stat grant of jurisdiction in CAFA; and, consequently, dismisses on 12b1 grounds.

At 11:40 AM, Anonymous Anonymous said...

Should have read more closely, I thought this was in a removal context. thanks for the correction.


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