In Standard Fire Insurance Co. v. Knowles, 133 S. Ct. 1345 (2013) (No. 11-1450), a class representative stipulated, pre-certification, that he and the class would not seek more than $5 million in damages. Under CAFA, federal courts have jurisdiction of certain class actions seeking more than $5 million in aggregate damages. Based on the stipulation, plaintiff sought remand of the removed case to state court. The Supreme Court ruled that the stipulation was not effective to bind the class and, as a result, did not defeat federal jurisdiction under CAFA. The Court stated that a stipulation is binding on the party who makes it. Although the stipulation bound Knowles, he had no authority to bind any others in the putative class. Because the stipulation was non-binding, the case was remanded to the district court for it to determine, as the statute requires, the aggregate value of the claims of the individual class members.
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Supreme Court: pre-certification jurisdictional stipulation ineffective
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