Monday, August 06, 2007

S.D. Florida Determines Relation-Back Doctrine Applies in CAFA Cases; Denies Plaintiff's Motion for Remand

Per Waldman v. Cingular Wireless LLC, Slip Copy, 2007 WL 1970858 (S.D.Fla. Jul 03, 2007) (NO. 07-80081-CIV):

AFA states that "the Act shall apply to any civil action commenced on or after the date of enactment of this act." CAFA was enacted on February 18, 2005 and it cannot be applied retroactively. Exxon Mobil Corp. v. Allapattah Services, Inc., 545 U.S. 546, 571, 125 S.Ct. 2611, 162 L.Ed.2d 502 (2005). Thus, a case that commenced prior to February 18, 2005 is not removable under this statute.

In this case, Plaintiffs filed their original complaint before CAFA was enacted but filed an amended complaint after CAFA was enacted. Thus, the issue here is to determine when Plaintiffs commenced their lawsuit; did the case commence upon filing of the original complaint or upon filing of the amended complaint. This inquiry necessarily leads to the question of whether the relation-back doctrine applies.

. . .

Thus, this Court must determine when the cases commenced for CAFA purposes. This Circuit requires that a district court look to state law from which the state court action commenced to determine when an action commenced. Here, this Court must look to Florida Rule of Civil Procedure1.050 which states that all civil actions are "commenced when the complaint ... is filed ..."

Plaintiffs urge this Court to adopt the 9th Circuit approach explained in McAtee v. Capitol One, F.S.B., 479 F.3d 1143, (9th Cir.2007). That court reasoned that the relation back doctrine is only used in instances where time is of the essence, for example, where a claim is limited by a statute of limitation. This court reasoned that the relation back doctrine accomplishes two goals: first, it protects a plaintiff's right to adjudicate a claim, and second, it protects defendants from being "ambushed" by late filed or late served causes of action where that defendant was not put on notice of the suit by the original complaint. CAFA does not, however, involve any statute of limitations issues and therefore the "stakes are lower" and do not require the protection provided by the relation back doctrine. This is because CAFA does not limit whether a case can be litigated, but rather dictates the forum in which the case will be litigated. Furthermore, the McAtee court held that "[i]n a CAFA case, we need be less concerned about avoiding unfair surprise of a defendant, and more concerned about having a clear and easy-to-follow rule. Thus, that court held that absent a clear state rule to the contrary, courts should not consider the relation back doctrine for CAFA purposes.

Defendant argues that the Ninth Circuit is the minority opinion and that this Court should instead follow the rule adopted by the Fifth, Seventh, Eighth, and Tenth Circuits. Braud v. Trans. Serv. Co., 445 F.3d 801, 806 (5th Cir.2006); Kndsen v. Liberty Mut. Ins. Co., 435 F.3d 775, 757 (7th Cir.2006); Plubell v. Merck & Co., 434 F.3d 1070, 1071 (8th Cir.2006); Prime Care of Ne. Kan. v. Humana Ins. Co., 447 F.3d 1284, 1289 (10th Cir.2006). As recognized in McAtee, these Circuits "have relied at least in part on state-law relation back doctrine." McAtee at 1146.

Although the Eleventh Circuit has never addressed this exact issue, one district court in this Circuit has adopted the Ninth Circuit's rationale. Lowery v. Honeywell Intern., Inc., 460 F.Supp.2d 1288, 1292 (N.D.Ala.2006). Two district courts in this Circuit, however, have used the relation back doctrine in their analysis. Senterfitt v. SunTrust Mortg., Inc., 385 F.Supp.2d 1377, 1379-80 (S.D.Ga.2005); Eufaula Drugs, Inc. v. Scripsolutions, 2005 WL 2465746 (M.D.Ala.2005).

This Court holds that the relation back doctrine does apply. Now this court must determine if Plaintiffs' amended complaint relates back to the original complaint. If the amended complaint does not relate back, Plaintiffs commenced a new suit for the purposes of CAFA.

Under Florida law, an amended complaint relates back to the date of the original pleading when "the claim or defense asserted in the amended pleading arose out of the conduct, transaction, or occurrence set forth or attempted to be set forth in the original pleading." Fla. R. Civ. Pro. 1.190(c). "The test of whether an amendment offered by a party sets forth a 'new cause of action' is not whether the cause of action stated in the amended pleading is identical to that stated in the original. Rather, the test is whether the pleading as amended is based upon the same specific conduct, transaction or occurrence between the parties upon which the plaintiff tried to enforce his original claim." Turner v. Trade-Mor, Inc., 252 So.2d 383, (Fla. 4th D.C.A.1971). Florida courts have interpreted this language more liberally than the correlative federal rule. Okeelanta Corp. v. Bygrave, 660 So.2d 743, 751 (Fla. 4th D.C.A.1995). Thus, when a party amends a complaint to add an entirely new party, relation back does not apply. Totura & Co., Inc. v. Williams, 754 So.2d 671, 673 (Fla.2000). Likewise, when a party amends a complaint to add an entirely new claim, relation back does not apply.

In this case, the amended complaint adds an entirely new claim. First, Plaintiffs expand the class definition beyond what was contemplated in the original complaint. Plaintiffs challenge the amount of ETFs charged regardless of whether the customer experienced service problems. Second, the amended complaint addresses customers who were charged an ETF when the amount of the ETF exceeded the remaining monthly service charges under the contract. Finally, the amended complaint adds a claim for injunctive relief wherein Cingular would be required to print the amount of months remaining in a customer's contract and/or prohibiting Cingular from charging an ETF for any contract extensions past the original contract termination date.

Thus, under CAFA, Defendant has shown that minimal diversity exists, the aggregate amount in controversy exceeds $5,000,000 and there are 100 or more class members.


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