In Jarrett-Cooper v. United Airlines, Inc., a travel agent and clients sued United Airlines after the airline failed to honor tickets that had been purchased on behalf of their clients. The plaintiffs commenced litigation in state court, prompting United to remove to a federal forum. Although the plaintiffs sought $53,000 in damages, United removed the case on diversity grounds based on the value of the injunctive relief that United claimed would exceed the $75,000 threshold. United claimed that the injunctive relief would require it to completely revise its procedures and computer systems on a nationwide basis. The plaintiffs disputed this contention, insisting that all United would have to do is correct the accounts on their computer system related to specifically to them. The district court agreed with United and exercised jurisdiction over the case.
On appeal, the Sixth Circuit reversed. Because the parties agreed that the plaintiffs’ damages were insufficient to meet the amount-in-controversy requirement, United’s only option for securing diversity jurisdiction was based on the value of the injunctive order. According to the Court, United’s vision of what would be required if an injunction were granted was unrealistic and overly broad. Deeming United’s injunction fix as “speculative” the Court found the amount-in-controversy requirement not satisfied based on United’s inability to demonstrate “the logical connection between its speculative amount and the actual controversy.”
While this opinion is brief and unpublished, it does serve as a good reminder to a litigants desiring to remove to a federal forum. While many parties may prefer a federal forum, the result here is in no one’s interest – litigation to the end of a case, only to have to begin anew in state court. Therefore, great care should be taken when trying to secure a federal forum based on the value of proposed injunctive relief. In other words, don’t inflate the prospect of the injunction beyond realistic confines.