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Shah v. Hyatt Corp.

February 1, 2010

ANJALI SHAH PLAINTIFF,
v.
HYATT CORPORATION DEFENDANT.



The opinion of the court was delivered by: Norma L. Shapiro, J.

MEMORANDUM

Before the court is plaintiff's motion to remand her case to state court [paper no. 4] and defendant's response in opposition [paper no. 9].

I. PROCEDURAL HISTORY

On August 25, 2009, plaintiff, Anjali Shah ("Shah"), filed a civil action individually and on behalf of individuals similarly situated in the Court of Common Pleas of Philadelphia County against defendant, Hyatt Corporation ("Hyatt"). Shah's complaint alleged that Hyatt systematically and continuously failed to compensate her and other Pennsylvania employees termed "assistant managers" for hours worked over the forty hour work week in violation of the Pennsylvania Minimum Wage Act (43 P.S. § 333.113) and the Wage Payment Collection Law (43 P.S. § 260.3 et seq.). On September 21, 2009, Hyatt filed a notice of removal [paper no. 1] from the Court of Common Pleas of Philadelphia County to the United States District Court for the Eastern District of Pennsylvania under 28 U.S.C. §§ 1332, 1441, and 1446. Hyatt alleged there was complete diversity between the parties, the amount in controversy for the named plaintiff's claim exceeded $75,000 (Notice of Removal ¶ 9), and since the named plaintiff has a claim in excess of $75,000, a federal court may exercise supplemental jurisdiction over all other class members with similar claims. See Exxon Mobil Corp. v. Allapattah Services, Inc., 545 U.S. 546, 549 (2005).

Shah in a motion to remand argues that the court lacks subject-matter jurisdiction because the class does not exceed 100 people and the matter in controversy does not exceed $5,000,000 as required by the Class Action Fairness Act ("CAFA"). See e.g., 28 U.S.C. §§ 1332(d)(2), (5)(b), & (6). Shah's complaint limited the class damages to a sum less than $5,000,000. (Complaint ¶¶ 58, 66, & 72). Shah's motion did not respond to Hyatt's allegations that the named parties are diverse or that Shah's individual claim exceeds $75,000.

II. STANDARD OF REVIEW

A civil action may be properly removed from state court to the federal district court if the district court has original jurisdiction. 28 U.S.C. § 1441(a). Federal district courts have original jurisdiction over civil actions where there is complete diversity between the parties and the amount in controversy exceeds the sum or value of $75,000, exclusive of interest and costs. 28 U.S.C. § 1332(a). If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded. 28 U.S.C. § 1447(c).

Under the provisions of CAFA, a federal district court also has original jurisdiction, without complete diversity, over "any civil action in which the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interest and costs, and is a class action in which... any member of a class of plaintiffs is a citizen of a State different from any defendant." 28 U.S.C. § 1332(d)(2). This provision applies only to class actions where the number of class members exceeds 100. 28 U.S.C. § 1332(d)(5)(B). In determining the amount in controversy under 28 U.S.C. § 1332(d)(2), the claims of the individual class members are aggregated. 28 U.S.C. § 1332(d)(6).

When a putative class action does not involve a federal question or meet CAFA's jurisdictional requirements, the Supreme Court's analysis of the supplemental jurisdiction statute, 28 U.S.C. § 1367, is relevant.*fn1 Title 28 U.S.C. § 1367 permits district courts to exercise supplemental jurisdiction over members of plaintiff's class action whose individual claims fail to meet the amount in controversy threshold, as long as the other elements of diversity jurisdiction are present and the claim of a single plaintiff satisfies the amount in controversy requirement. See Exxon Mobil Corp., 545 U.S. at 558-60; Czarnecki v. Hawthorn Manufacturing Corp., No. 08-5558, 2009 WL 159806, at *2-3 (E.D.Pa. Jan. 16, 2009) (the court has the authority to exercise supplemental jurisdiction over all members of the putative class so long as the claim of the named plaintiff exceeds $75,000). This broad grant of jurisdiction under § 1367 is limited by the exceptions set forth in § 1367(b) and the trial court's discretion to decline supplemental jurisdiction in the categories stated in § 1367(c).*fn2 Growth Horizons Inc. v. Delaware County, Pa., 983 F.2d 1277, 1284 (3d Cir. 1993) (the district court should take into account generally accepted principles of "judicial economy, convenience, and fairness to the litigants.").

III. DISCUSSION

Title 28 U.S.C. § 1332(a) and § 1332(d) provide separate, independent means by which a court has original jurisdiction. See Steel City Group v. Global Online Direct, Inc., No. 06-1501, 2006 WL 3484318, at *1 (W.D.Pa. Nov. 30, 2006) ("[N]othing in the text of Section 1332(d) purports to supplant or restrict the traditional diversity jurisdiction conferred under Section 1332(a)."). Analyzed under either rubric, this court would find that remand is appropriate in this case.

A. § 1332(d) --

The complaint asserts (and defendant agrees) that Shah is a citizen of Pennsylvania, Hyatt is a corporation incorporated in Illinois, and that the putative class would consist of all "assistant managers" employed by Hyatt in the Commonwealth of Pennsylvania. (Complaint ¶¶ 1, 2, & 20). The minimal diversity required by § 1332(d)(2)(A) is established, but the other requirements for original jurisdiction under § 1332(d) are not. Shah has limited her claim to a sum less than $5,000,000. (Complaint ¶ 58, 66, & 72). When the plaintiff expressly limits her claim in the complaint, the proponent of federal jurisdiction must show to a legal certainty that the amount in controversy actually exceeds the jurisdictional threshold. Frederico v. Home Depot, 507 F3d 188, 196 (3d Cir. 2007). Hyatt has made no attempt to meet this burden, and has explicitly stated that the grounds for removal are based on the traditional ...


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