Federal Judiciary

Seventh Chastises Ninth for Encouraging Mickey Mouse Law Suits

By Robert Loblaw

Springman v. AIG Marketing, Inc., 08-1019 (7^th Cir., April 15, 2008)

In a decision issued last week and amended today, the Seventh has deepened a circuit split under the Class Action Fairness Act. CAFA gave defendants a much-fought-for right to remove certain large class actions from state to federal court, but CAFA only applies to lawsuits filed after its effective date of February 18, 2005. At issue in this Seventh Circuit appeal is whether a suit filed before CAFA?s effective date but naming the wrong defendant is subject to CAFA removal once the plaintiff names the correct defendant.

The Ninth Circuit has held that the answer is no, and that class actions filed before the effective date are not removable, even if the plaintiff substituted the correct defendant after the effective date. Several other circuits have rejected this position, and the Seventh adds itself to the list. In classic fashion, Judge Posner has this to say about his westernmost colleagues? logic:

On the Ninth Circuit?s view, a plaintiff can defeat removal by first filing a complaint that does not include a claim or a defendant that would trigger the Act?s right of removal and later substituting a claim or defendant that would have triggered the right. Suppose that with the Act?s effective date looming, the plaintiff had not completed even a minimal pre-complaint investigation. Under the Ninth Circuit?s view, the plaintiff could sue Donald Duck for violating a Chicago noise ordinance and then at his leisure amend the complaint to substitute a proper claim against a proper defendant, and the new defendant would not be able to remove.

Full post as published by Decision of the Day on April 22, 2008 (boomark / email).