Complex Litigation: CAFA Mass Actions

Abstract

Commentary and analysis of the so-called “mass action” provision included in the Class Action Fairness Act of 2005 (CAFA). Congress enacted CAFA in 2005 to create new federal diversity jurisdiction especially for class actions. In order to gain access to federal court, the proponents of a class action must demonstrate diversity of citizenship between the class claimants and the defendants, that there are at least 100 members in the class, and that the amount in controversy exceeds $5 million. 28 U.S.C. § 1332(d). To satisfy these requirements, the proponents needs only to show minimal diversity among the parties, and may aggregate the claimants’ damages to reach the $5 million amount-in-controversy threshold. In addition, Congress created a new removal provision for state-based class actions that satisfy the federal jurisdiction requirements. 28 U.S.C. § 1453. CAFA also contains a sleeper provision for state court “mass actions” that basically join large numbers of claimants with similar claims and legal theories in one lawsuit, but which is not pursued as a class action. If such “mass actions” satisfy the requirements for jurisdiction of a class action, then CAFA permits removal of such mass actions to federal court. This article discusses the seminal decision Abrego v. The Dow Chemical Co., 2006 U.S. App. Lexis 8077 (9th Cir. April 4, 2006), discussing CAFA’s mass action provisions, without deciding the propriety of the defendant’s attempted removal of a state mass action to federal court.

Keywords: Class Action Fairness Act of 2005, CAFA, CAFA mass actions, mass actions, 28 U.S.C. 1332(d)(11)(c), Abrego v. The Dow Chemical Co., CAFA removal, 28 U.S.C. 1453