United States: Amount In Controversy Adequately Supported By Defendant’s Affidavit

Last Updated: March 19 2014
Article by CAFA Law Blog

Turnage v. Old Dominion Freight Line, Inc, 2013 WL 2950836 (N.D. Cal. June 14, 2013).

The plaintiff, truck driver, brought a wage and hour action in violation of California Labor Code, and Industrial Welfare Commission Wage Orders.  The plaintiff also brought a representative claim under the Private Attorney General Act, and a cause of action for unlawful, deceptive, and unfair business practices under California Business & Professions Code § 17200.  The plaintiff alleged failure to provide meal and rest periods, to pay minimum wages, to pay wages in a timely manner, to provide itemized wage statements, to maintain accurate records, and to allow inspection of personnel files and records.   

The defendant removed the action from the Alameda County Superior Court to the District Court under CAFA and submitted a declaration of its Director of Compensation and Employee Benefits, in which he provided calculations of an estimated amount in controversy in excess of $29 million.  

The plaintiff moved to the remand the action, and the defendant moved to dismiss all the claims, and to transfer, dismiss or stay the action.  The District Court denied the plaintiff's motion, and granted the defendant's motion to transfer the action, and rendered the defendant's motion to dismiss as moot. 

First, the plaintiff sought remand arguing that the defendant failed to establish that the amount in controversy exceeded $5 million.  Because the complaint did not specify the amount of damages sought, the District Court stated that the removing defendant must prove by a preponderance of the evidence that the amount in controversy requirement had been met. (Editor's Note:  See the CAFA Law Blog analysis of Abrego Abrego posted on May 25, 2006, the CAFA Law Blog analysis of Lowdermilk posted on July 30, 2007).   

The District Court observed that in calculating the amount in controversy, the ultimate inquiry is what amount is put in controversy by the complaint, not what a defendant will actually owe, and that the amount in controversy includes the amount of damages in dispute, as well as attorney's fees, if authorized by statute or contract.  Further, the District Court noted that facts in the removal petition would be considered, and the parties may be required to submit summary-judgment type evidence relevant to the amount in controversy at the time of removal. 

The defendant simultaneously filed its opposition to the plaintiff's motion to remand with an amended notice of removal, which was accompanied by a declaration by its Vice President, Human Resources.  The declaration, which was based on a review of the defendant's personnel and employment records, showing that at least 341 full-time drivers were employed during the period from January 22, 2009 through January 22, 2013.  

Based on the number of employees working at any given time, and the number of net workweeks, the declaration estimated that the penalties for the meal break and rest break claims was $4,146,254.40, the penalties for the minimum wage claims was $681,040.00, and the penalties for waiting-time penalties and penalties for inaccurate wage statements exceeded $1.3 million.  In addition, the defendant claimed that a 25% attorney's fee was reasonable.  

The District Court opined that the calculations were adequately supported by the declaration of the Vice President, and that they sufficiently established by a preponderance of the evidence that the total amount in controversy exceeded $5 million.  Accordingly, the District Court denied the motion to remand. 

Finally, the defendant sought to transfer the action to the Central District of California and asserted that the interests of justice strongly favored transfer because of the pendency in that district of another similar class action, which was filed before the present action was filed.  Because the convenience of the parties among other factors favored transferring venue, and the plaintiff did not provide any opposition to the motion in the form of analysis of the factors, the District Court ordered transfer of this action to the Central District of California.

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