In finding a putative class action removable to federal court under the Class Action Fairness Act (CAFA), the First Circuit Court of Appeals has clarified removal time periods and mechanisms under the law in line with other circuits that have adopted a “bright-line approach.” Romulus v. CVS Pharmacy, Inc., No. 14-1937 (1st Cir., decided October 24, 2014). Several issues of first impression for the court arose in the context of a dispute involving overtime pay.
Employer CVS sought to remove the action within 30 days of service, estimating damages in excess of $10 million assuming that the class members lost each meal break during the class period. The district court rejected the calculation and granted the plaintiffs’ motion to remand, concerned that CVS’s assumptions were not rooted in the complaint’s allegations and thus failed to prove the requisite jurisdictional amount. The parties thereafter conducted preliminary discovery, and the plaintiffs emailed the defendant a data analysis showing 116,499 meal breaks between August 2010 and June 2012 when just one shift supervisor was working—according to the complaint, this meant that the shift supervisors would not have been paid for breaks, since the company allegedly required them to remain on the store premises when no other managerial employees were on duty.
CVS filed its second notice of removal within 30 days of receiving the email, arguing that by extrapolating the alleged number of violations over the entire class period, which started in 2008, there was a “reasonable probability that the amount in controversy exceeds $5,000,000.” The district court again remanded the matter to state court, finding CVS’s second notice untimely and that it had failed to show that more than $5 million was at stake in the litigation. According to the district court, the only possible qualifying document was the plaintiffs’ email, and it deemed the email inadequate to serve as an “other paper” under 28 U.S.C. § 1446(b)(3) because “it was based entirely on information provided by defendant” and was readily available to it from the start. Thus, the court deemed the proper date for calculating timeliness to the date for the return of service. The First Circuit granted CVS’s request for an interlocutory appeal.
The First Circuit held that section 1446(b)’s 30-day clocks are triggered “only when the plaintiffs’ complaint or plaintiffs’ subsequent paper provides the defendant with sufficient information to easily determine that the matter is removable. The district court erred in imposing too great a duty of inquiry on the defendant.” Here, the email triggered the 30-day deadline “by providing sufficient information from which to easily ascertain the amount in controversy for the first time.” The court also concluded that an email constitutes an “other paper” under CAFA, finding persuasive authority that gives the phrase an expansive construction.