Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_07-cv-01842/USCOURTS-casd-3_07-cv-01842-1/pdf.json

Nature of Suit Code: 442
Nature of Suit: Civil Rights Employment
Cause of Action: 28:1332 Diversity-Petition for Removal

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1 07cv1842-LAB(NLS)

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

JOEL M. CRAM, et al.,

Plaintiffs,

v.

ELECTRONIC DATA SYSTEMS

CORPORATION, et al.,

Defendants. 

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Civil No.07cv1842-LAB(NLS)

ORDER RE: PLAINTIFFS’ EX PARTE

APPLICATION FOR ORDER

AUTHORIZING PRE-HEARING

DISCOVERY

[Doc. No. 8]

On September 25, 2007, Plaintiffs in the above-captioned matter filed an Ex Parte Application

for Order Authorizing Pre-Hearing Discovery in Relation to Motion for Remand [Doc. No. 8], along

with several supporting documents [Doc. Nos. 9-11]. Plaintiffs’ request leave of court to commence and

conduct discovery in advance of the November 13, 2007 hearing date set before presiding District Judge

Larry A. Burns on their pending motion to remand this case to state court. Defendants filed an

opposition to the ex parte application [Doc. No. 12] and Plaintiffs filed a reply [Doc. No. 16]. For the

following reasons, the Court GRANTS Plaintiffs’ Ex Parte Application [Doc. No. 8]. 

BACKGROUND

On August 21, 2007, Plaintiffs Joel M. Cram and Minh D. Nguyen (“Plaintiffs”) filed a putative

class action complaint in San Diego County Superior Court against Defendant Electronic Data Systems

Corporation (“Defendant”) alleging causes of action for: (1) unpaid overtime compensation in violation

of California Labor Code (“CLC”) Sections 510 and 1194; (2) waiting penalties pursuant to CLC

Sections 201-203; and (3) unfair competition in violation of California Business and Professions Code

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Section 17200 et seq. (See Plaintiffs’ Complaint ¶¶ 28-48.) On September 20, 2007, Defendant

removed the action to this Court pursuant to the Class Action Fairness Act of 2005 (“CAFA”), 28

U.S.C. § 1332(d), which provides federal district courts with original jurisdiction over class actions with

100 or more putative class members, where the amount in controversy exceeds the sum or value of

$5,000,000, and where “minimal” diversity of citizenship exists between at least one class member and

the defendant. See 28 U.S.C. § 1332(d)(2). 

Plaintiffs filed this action as a class action involving allegedly more than 100 putative class

plaintiffs. (Complaint ¶ 26.a.) Accordingly, by Plaintiffs’ own allegations, the first requirement to

support this Court’s jurisdiction under CAFA is met. Defendant asserts in the Notice of Removal that

diversity of citizenship exists between individually named Plaintiffs Cram and Nguyen, both citizens of

California, and Defendant, which is incorporated in Delaware. (Defendant’s Notice of Removal ¶¶ 10-

11.) Plaintiffs do not dispute this assertion. (Complaint ¶¶ 4,5, & 8.) Therefore, the second

requirement to support this Court’s jurisdiction under CAFA is also met. However, the parties disagree

as to whether the third and final requirement for jurisdiction, amount in controversy, is satisfied. 

Defendant makes specific allegations in the Notice of Removal regarding the amount placed in

controversy by Plaintiffs’ complaint, arguing that the amount exceeds $10,000,000, plus attorneys’ fees

and expenses, and therefore easily satisfies the $5,000,000 requirement under §1332(d). (Id. ¶ 14.) 

Plaintiffs dispute Defendant’s allegations regarding amount in controversy, and on September

25, 2007, filed a Motion to Remand this matter back to state court arguing that the amount in

controversy requirement is not met [Doc. No. 3]. The motion to remand is set for hearing on November

13, 2007 before presiding District Judge Larry A. Burns. Also on September 25, 2007, Plaintiffs filed

the instant ex parte application, seeking jurisdictional discovery from Defendant regarding the amount

in controversy alleged by Defendant in the Notice of Removal [Doc. No. 8]. Plaintiffs argue that any

and all evidence which may establish that the amount in controversy exceeds $5,000,000 is in the

exclusive possession of Defendant, and that denial of discovery prior to the hearing on the motion to

remand could result in an erroneous exercise of subject matter jurisdiction by this Court. (Memorandum

in Support of Plaintiffs’ Ex Parte Application, 3.) 

/ / /

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Defendant filed an opposition to Plaintiffs’ request for pre-hearing discovery [Doc. No. 12]. 

First, Defendant argues that Plaintiffs’ ex parte application is procedurally inappropriate, and that

Plaintiffs should have filed a fully noticed motion to compel the requested discovery. Second,

Defendant contends that Plaintiffs’ discovery request lacks the requisite detail necessary for the Court to

determine whether and to what extent any discovery should be allowed. Third, Defendant argues that

there is no basis for the “expedited” jurisdictional discovery that Plaintiffs seek because challenges to

subject matter jurisdiction under CAFA can be raised at any time. Finally, Defendant argues that the

instant proceedings could have been avoided if Plaintiffs had continued to engage in meet and confer

discussions with Defendant regarding Defendant’s potential willingness to provide Plaintiffs with

further documentation supporting jurisdictional amount. Defendant asserts that as a result of Plaintiffs’

hasty filing, their ex parte application has caused unnecessary expense to both the parties and the Court. 

(Defendant’s Opposition, 2-3.) Plaintiffs filed a reply, in which they defend their choice of procedural

mechanism as proper and necessary given the hearing date currently set on the motion to remand. 

(Plaintiffs’ Reply, 2.) Plaintiffs also attempt to clarify the discovery sought, stating that discovery is

only directed to Defendant and includes information regarding Defendant’s staffing, payroll, and recordkeeping practices with respect to the putative plaintiff class. (Id. at 3-4.) 

DISCUSSION

A. Legal Standard

1. Discovery in General

The Federal Rules allow for broad discovery in civil actions: “Parties may obtain discovery

regarding any matter, not privileged, that is relevant to the claim or defense of any party. . . Relevant

information need not be admissible at trial if the discovery appears reasonably calculated to lead to the

discovery of admissible evidence.” FED. R. CIV. P. 26(b)(1). This provision is liberally construed to

provide wide-ranging discovery of information necessary for parties to evaluate and resolve their

dispute. Oakes v. Halvorsen Marine Ltd., 179 F.R.D. 281, 283 (C.D. Cal. 1995). The party seeking to

compel discovery has the burden of establishing that its request satisfies the relevancy requirements of

Rule 26(b)(1). Soto v. City of Concord, 162 F.R.D. 603, 610 (N.D. Cal. 1995). In turn, the party

opposing discovery has the burden of showing that discovery should not be allowed, and also has the

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burden of clarifying, explaining and supporting its objections. DirectTV, Inc. V. Trone, 209 F.R.D. 455,

458 (C.D. Cal. 2002); Oakes, 179 F.R.D. at 283. 

2. Amount in controversy under CAFA

The general principles embodied in the Federal Rules of Civil Procedure which support liberal

discovery in civil cases must be considered in tandem with the body of case law that has developed

specifically to address pre-class certification discovery in cases removed to federal court pursuant to

CAFA. Generally in purported class actions, the amount in controversy is to be decided from the

complaint itself. Richmond v. Allstate Ins. Co., 897 F. Supp. 447, 449 (S.D. Cal. 1995). See also

Pachinger v. MGM Grand Hotel-Las Vegas, Inc., 802 F.2d 362, 363 (9th Cir. 1986) (“The amount in

controversy is normally determined from the face of the pleadings.”) The calculation of the amount in

controversy takes into account claims for “general” damages, “special” damages, punitive damages if

recoverable as a matter of law, and attorneys’ fees recoverable by statute or contract. Id. (citations

omitted). The amount in controversy does not include accruing or accrued interest or the costs of the

suit. Id. (citation omitted). According to the Report of the Senate Committee on the Judiciary on

CAFA, the requirement under CAFA that the amount in controversy exceed $5,000,000 in the aggregate

may be established “either from the viewpoint of the plaintiff or the viewpoint of the defendant, and

regardless of the type of relief sought (e.g., damages, injunctive relief, or declaratory relief).” S. Comm.

on the Judiciary, Class Action Fairness Act of 2005, S.Rep. No. 109-14, at 40 (Feb. 28, 2005), reprinted

in 2005 U.S.C.C.A.N. 3, 2005 WL 627977.

The procedure in the Ninth Circuit for determining the amount in controversy on removal

requires a district court to first consider whether it is “facially apparent” from the complaint that the

jurisdictional amount is in controversy. See Singer v. State Farm Mut. Auto. Ins. Co., 116 F.3d 373, 377

(9th Cir. 1997). If it is not, the court may consider facts in the removal petition as well as evidence

submitted by the parties, including “summary-judgment-type evidence relevant to the amount in

controversy at the time of removal.” Id. A defendant who bears the burden of proving the propriety of

removal must provide facts supporting its assertions as to the minimum jurisdictional requirement. See,

e.g., Alexander v. FedEx Ground Package System, Inc., 2005 WL 701601, at *1 (N.D. Cal. 2005), citing

Gaus v. Miles, Inc., 980 F.2d 564, 567 (9th Cir. 1992). 

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Jurisdictional discovery is permissible when the Court is unable to determine, on the existing

record, whether it has jurisdiction. See generally Wells Fargo & Co. v. Wells Fargo Exp. Co., 556 F.2d

406, 430 n.24 (9th Cir. 1977); GTE New Media Servs., Inc. v. BellSouth Corp., 199 F.3d 1343, 1351-52

(D.C. Cir. 2000). Such discovery should be “precisely focused” and “aimed at addressing matters

relating to [] jurisdiction.” See GTE, 199 F.3d at 1352; see also Crane v. Carr, 814 F.2d 758, 764 (D.C.

Cir. 1987) (finding that “reasonable discovery addressed to the jurisdictional issue” should be

permitted). Jurisdictional discovery in CAFA cases, as in pre-CAFA cases, should be “sufficiently

tailored” to lead to information concerning the jurisdictional issue. See Rippee v. Boston Market Corp.,

408 F.Supp.2d 982, 985 (S.D.Cal. 2005) citing Schwartz v. Comcast Corp., 2005 WL 1799414, at *7

(E.D. Pa. July 28, 2005). 

B. Analysis

Plaintiffs seek jurisdictional discovery regarding the amount in controversy asserted in

Defendant’s Notice of Removal. Plaintiffs argue that they require limited discovery on this issue in

order to support their pending motion to remand, which rests on the single contention that the amount

placed in controversy by their complaint does not meet the $5,000,000 threshold required by CAFA. 

(Plaintiffs’ Memorandum, 2-3.) In support of this request, Plaintiffs cite the preponderance of the

evidence standard that will apply on the motion to remand. (Plaintiffs’ Reply, 2.) Plaintiffs contend that

if they are not permitted to discover information solely in Defendant’s possession regarding the amount

in controversy in this case, they will be unduly prejudiced in litigating their remand motion. (Id.) 

Defendant raises several arguments in opposition to Plaintiffs’ request. First, Defendant

contends that Plaintiffs’ ex parte application is procedurally improper, Plaintiffs should be proceeding

via noticed motion, and no urgency exists to support jurisdictional discovery on an expedited basis. 

(Defendant’s Opposition, 4.) Pursuant to Civil Local Rule 26.1.e, all requests of the Court to compel

discovery are referred to the magistrate judge assigned to the case, who retains discretion to waive all or

part of the motion practice requirements of Civil Local Rule 7.1. It is well within this Court’s discretion

to accept Plaintiffs’ request as an ex parte application and rule on the application in an expedited basis. 

Thus, Defendant’s procedural argument is unavailing. Furthermore, to the extent that Defendant argues

“there is no urgency for the remand motion to be heard,” and therefore no basis for ruling on Plaintiffs’

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1

 Pursuant to Civil Local Rule 26.1.a, “[t]he court shall entertain no motion pursuant to Rules 26 through 37, Fed. R.

Civ. P., unless counsel shall have previously met and conferred concerning all disputed issues. ( . . . ) If counsel have offices

in the same county, they are to meet in person. If counsel have offices in different counties, they are to confer by telephone.” 

6 07cv1842-LAB(NLS)

ex parte application expeditiously, this argument also fails. This Court exercised its discretion to hear

this matter on an expedited basis because Plaintiffs seek discovery that allegedly is relevant to the

disposition of a motion currently pending before the presiding district judge, set for hearing in

approximately six weeks. Although the statutory basis for jurisdiction in this case may not dictate

accelerated consideration of Plaintiffs’ request, the hearing date set by the district judge on Plaintiffs’

pending motion to remand this case to state court does so require. 

Defendant next argues that Plaintiffs filed this ex parte application prematurely based on the fact

that the parties engaged in only a limited attempt to meet and confer prior to Plaintiffs filing the

application. (Defendant’s Opposition, 5.) Defendant states that the meet and confer consisted of a

single phone call lasting approximately one half of an hour, and that counsel for Defendant offered

during the course of the discussion to provide Plaintiffs with supplemental information to resolve the

amount in controversy issue and avoid the current proceedings. (Id.; Declaration of Martin T. Wymer ¶¶

4-5.) Based on Defense counsel’s own Declaration filed in support of Defendant’s opposition, the meet

and confer requirement was met by the parties prior to Plaintiffs filing the ex parte application.1

Therefore, Defendant’s contention that Plaintiffs should have put forth additional effort to resolve the

instant dispute prior to seeking relief from the Court is without legal merit. 

The Court notes that Defendant’s arguments are almost entirely procedural in nature. Defendant

does not raise a substantive basis for why the Court should prohibit Plaintiffs from conducting limited

discovery in this matter, when the relevant case law as well liberal discovery rules tend to support the

request. In addition, the Court appreciates that Defendant offered to provide relevant information

voluntarily to Plaintiffs in order to resolve the amount in controversy issue without the involvement of

the Court. (Defendant’s Opposition, 2, 5; Declaration of Martin T. Wymer ¶ 5.) Based on Defendant’s

demonstrated willingness to provide Plaintiffs with information to support the assertion that the amount

placed in controversy by Plaintiffs’ complaint exceeds $5,000,000, and Plaintiffs’ request for such

information, and in consideration of the Ninth Circuit’s approach to pre-remand discovery in CAFA

cases, the Court shall allow expedited, limited discovery to go forward on the single issue of amount in

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28 2 The answering party shall “furnish such information as is available to the party” after conducting a reasonable

inquiry. See FED. R. CIV. P. 33(a). Each interrogatory must be answered separately and under oath. FED. R. CIV. P. 33(b). 

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controversy. However, the Court notes that a defendant’s burden is to produce underlying facts showing

only that it is more likely than not that the amount in controversy exceeds $5,000,000.00, assuming the

truth of the allegations plead in the plaintiff’s complaint. Singer v. State Farm Mut. Auto. Ins. Co., 116

F.3d 373, 376 (9th Cir. 1996); Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir.1996). 

Thus, a defendant is generally not obligated to support removal with production of extensive business

records to prove or disprove liability and/or damages with respect to putative class members at the

pre-certification stage of the litigation. McCraw v. Lyons, 863 F.Supp. 430, 434 (W.D.Ky. 1994)

(recognizing that the preponderance of the evidence standard does not place a “daunting” burden on the

defendant to prove the plaintiff’s claims for damages). Therefore, the Court shall limit not only the

scope and duration of jurisdictional discovery, but also shall restrict the discovery method to the use of

interrogatories only, in the interest of judicial economy and in an effort to lessen the burden that this

discovery may place on the parties.2

 

CONCLUSION

Based on the foregoing reasons, the Court GRANTS Plaintiffs’ Ex Parte Application [Doc. No.

8] and shall allow both parties to conduct expedited, limited discovery on the single issue of whether the

amount placed in controversy by the allegations in Plaintiffs’ complaint exceeds the $5,000,000

requirement set forth by CAFA. See 28 U.S.C. § 1332(d). Pursuant to Federal Rule of Civil Procedure

33, Plaintiffs and Defendant shall be allowed to propound on the other a single set of interrogatories, not

to exceed ten (10) in number for each side, directed specifically towards this issue. This expedited

discovery shall be completed within thirty (30) days of the date of this order. Failure to comply with

this order shall be grounds for the imposition of sanctions, including but not limited to exclusion of

evidence, taking certain facts as established, and/or monetary sanctions. See FED. R. CIV. P. 37(c). 

IT IS SO ORDERED.

DATED: October 3, 2007

Hon. Nita L. Stormes

U.S. Magistrate Judge

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