Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-15-55176/USCOURTS-ca9-15-55176-0/pdf.json

Parties Involved:
Dollar Tree Stores, Inc.
Appellant
Richard Reyes
Appellee

Document Text:

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

RICHARD REYES, as an individual

and on behalf of all others similarly

situated,

Plaintiff-Appellee,

v.

DOLLAR TREE STORES, INC., a

corporation,

Defendant-Appellant.

No. 15-55176

D.C. No.

2:14-cv-04581-

R-VBK

OPINION

Appeal from the United States District Court

for the Central District of California

Manuel L. Real, District Judge, Presiding

Argued and Submitted

March 5, 2015—Pasadena, California

Filed April 1, 2015

Before: Stephen Reinhardt, N. Randy Smith,

and Andrew D. Hurwitz, Circuit Judges.

Opinion by Judge Hurwitz

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2 REYES V. DOLLAR TREE STORES

SUMMARY*

Class Action Fairness Act / Jurisdiction / Removal

The panel reversed the district court’s order remanding

the case to state court, and remanded with instructions for the

district court to exercise federal jurisdiction under the Class

Action Fairness Act.

Defendant Dollar Tree Stores removed the case from state

to federal court in 2012 invoking jurisdiction under CAFA,

and the district court granted plaintiff Richard Reyes’ request

to remand back to state court because the CAFA $5 million

amount-in-controversyrequirement was not satisfied. In May

2014, a California superior court certified a broader class and

the amount-in-controversy for the class actually certified

exceeded $5 million. Dollar Tree again removed to federal

court, and the district court found removal untimely because

the order was based on the same complaint that was the

subject of the first removal.

The panel held that the state court’s class certification

order created a new occasion for removal, and the second

removal was permissible. The panel also held that the second

removal was timely because Dollar Tree removed within

thirty days of the class certification order. The panel

concluded that because the jurisdictional requirements of

CAFA were met, the district court had subject matter

jurisdiction.

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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REYES V. DOLLAR TREE STORES 3

COUNSEL

Dominic J. Messiha (argued), Littler Mendelson, Los

Angeles, California; Lindbergh Porter, Tarun Mehta, Jeffrey

Mann, Littler Mendelson, San Francisco, California, for

Defendants-Appellants.

Kenneth H. Yoon (argued), Stephanie E. Yasuda, Law

Offices of Kenneth Y. Yoon, Los Angeles, California; Peter

M. Hart, Travis Hodgkins, Law Offices of Peter M. Hart, Los

Angeles, California, for Plaintiff-Appellee.

OPINION

HURWITZ, Circuit Judge:

Defendant Dollar Tree Stores, Inc. removed this case to

federal court in 2012, invoking jurisdiction under the Class

Action Fairness Act of 2005 (CAFA), 28 U.S.C. §§ 1332(d),

1453, 1711–1715. Plaintiff Richard Reyes moved to remand,

representing that the amended complaint defined the

proposed class narrowly and that the CAFA $5,000,000

amount-in-controversyrequirementwastherefore unsatisfied. 

The district court agreed and remanded.

In May 2014, a California superior court certified a

broader class than the one described by Reyes during the first

removal. It is uncontested that the amount in controversy for

the class actually certified exceeds $5,000,000. Dollar Tree

again removed after the superior court entered the class

certification order, but the district court found removal

untimely because the order was based on the same complaint

that was the subject of the first removal.

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4 REYES V. DOLLAR TREE STORES

The issue before us is whether the class certification order

created a new occasion for removal. We conclude that it did

and remand to the district court to exercise jurisdiction under

CAFA.

I.

Reyes filed this action in California state court in July

2012, alleging that Dollar Tree violated California Labor

Code § 226.7 by denying proper rest breaks to its employees. 

Reyes filed an amended complaint in December 2012,

asserting a second cause of action for unlawful business

conduct in violation of California Business and Professions

Code § 17200.

Paragraph fourteen of the amended complaint sought

certification of a class of

all current and former non-exempt employees

of [Dollar Tree] who worked as assistant

managers in California who worked one or

more work periods in excess of three and onehalf (3.5) hours without receiving a paid ten

(10) minute break during which they were

relieved of all duties, from and after July 13,

2008.

The amended complaint alleged that the “amount in

controversyis less than $5,000,000.00 in the aggregate for the

putative Class.”

In December 2012, Dollar Tree removed the action to the

United States District Court for the Central District of

California, asserting CAFA jurisdiction. In support of the

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REYES V. DOLLAR TREE STORES 5

removal, Dollar Tree noted that the amended complaint

alleged that plaintiffs “regularly” missed their breaks, and

“conservativelyinterpret[ed] ‘regularly’ to mean a rest period

was not ‘authorized or permitted’ in 65% of shifts that were

sufficiently long to trigger an obligation to authorize or

permit rest periods.” This assumption placed the amount in

controversy at $5,525,950.

Reyes moved to remand, arguing that the assumed 65%

violation rate was inaccurate. Reyes argued that Dollar Tree

had misread the amended complaint: “Defendant goes beyond

Plaintiff’s allegations to establish the amount in controversy

by including claims that Plaintiff has not included in his

[amended complaint]—namely, Plaintiff has limited his

allegations to shifts where ‘Class Members at times worked

without another manager at the same time.’” In support of

this position, Reyes cited paragraph twenty-eight of the

amended complaint, which alleges:

As a pattern and practice, Defendants

regularly required employees to work through

their rest breaks without proper compensation

in that Class Members at times worked

without another manager at the same time,

and per Defendant policy and practice, were

not authorized and permitted to take fully

compliant 10-minute rest breaks.

Reyes claimed that only one-third of shifts were worked

alone, and that the amount in controversy was therefore only

$2,866,772. The district court agreed, finding that the

amended complaint limited the putative class to employees

who worked alone, and that the amount in controversy

therefore did not reach the $5,000,000 CAFA threshold.

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6 REYES V. DOLLAR TREE STORES

After remand, Reyes moved, consistent with his position

in the district court, for certification of a class of

all current and former non-exempt employees

of Defendants who worked as Assistant Store

Managers in California who worked without

another Assistant Store Manager on the clock

according to Defendant’s time records and

without another Store Manager scheduled to

work according to Defendant’s schedule

records, and who worked one or more work

periods in excess of three and one-half (3.5)

hours.

Before oral argument on the motion, however, the superior

court issued a tentative ruling concluding that a class of

assistant managers who worked alone would not be

ascertainable. Noting that California law permitted the court

to depart from the plaintiff’s proposed definition and redefine

the class, the tentative ruling instead proposed certifying a

class consisting of all assistant managers who did not receive

proper breaks, regardless of whether they worked alone. At

the class certification hearing, Dollar Tree argued that the

amended complaint had previously been construed by the

district court—at Reyes’s urging—to limit the class to

plaintiffs who worked alone, and noted that it was now “faced

with a class definition that’s really new.” On May 15, 2014,

the superior court nonetheless certified the class described in

the tentative ruling.

Dollar Tree filed a notice of removal on June 13, 2014,

arguing that the expanded class certified by the superior court

placed at least $5,000,000 in controversy. In granting

Reyes’s motion to remand, the district court held that the

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REYES V. DOLLAR TREE STORES 7

second removal was untimely because it was based on the

same class definition—found in paragraph fourteen of the

amended complaint—that had been the subject of the first

removal.

The district court’s order granting the second remand

motion is the subject of this appeal. We have appellate

jurisdiction under 28 U.S.C. § 1453(c), and review the

remand order de novo. Ibarra v. Manheim Invs., Inc.,

775 F.3d 1193, 1196 (9th Cir. 2015).

II.

A defendant generally may remove a civil action if a

federal district court would have original jurisdiction over the

action. 28 U.S.C. § 1441(a). Dollar Tree asserted federal

jurisdiction under CAFA, which vests district courts with

jurisdiction over civil actions in which “the matter in

controversy exceeds the sum or value of $5,000,000,

exclusive of interest and costs,” the proposed class consists of

more than 100 members, and “any member of [the] class of

plaintiffs is a citizen of a State different from any defendant.” 

Id. § 1332(d); see also Standard Fire Ins. Co. v. Knowles,

133 S. Ct. 1345, 1348 (2013). It is undisputed that the class

actuallycertified by the superior court satisfies these statutory

requirements. Reyes argues that the removal violated the

prohibition against successive removals and was untimely.

A.

A successive removal petition is permitted only upon a

“relevant change of circumstances”—that is, “when

subsequent pleadings or events reveal a new and different

ground for removal.” Kirkbride v. Cont’l Cas. Co., 933 F.2d

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8 REYES V. DOLLAR TREE STORES

729, 732 (9th Cir. 1991). We have recognized such changes

in circumstances, for example, when an intervening change

of law gives rise to a new basis for subject-matter

jurisdiction. See Rea v. Michaels Stores Inc., 742 F.3d 1234,

1238 (9th Cir. 2014); Kirkbride, 933 F.2d at 732. Successive

petitions are also permitted when the pleadings are amended

to create federal subject-matter jurisdiction for the first time.

See O’Bryan v. Chandler, 496 F.2d 403, 409 (10th Cir. 1974)

(collecting authorities).

On the first remand motion, the district court construed

the amended complaint to cover only rest breaks during shifts

in which a class member worked alone and found that it

therefore did not meet the CAFA amount-in-controversy

threshold. In contrast, the superior court certified a class of

employees who worked shifts without proper rest breaks,

regardless of whether they worked alone. In doing so, the

state court expressly acknowledged that it had diverged from

the narrower definition of the class that the district court

settled upon, and for which the plaintiff sought certification

after remand. The superior court’s class certification order

thus altered the circumstances bearing on jurisdiction by

expanding the amount in controversy.

For removal purposes, the certification order is

functionally indistinguishable from an order permitting the

amendment of pleadings to alter the class definition, creating

CAFA jurisdiction for the first time. When pleadings are

amended so as to establish federal jurisdiction where none

existed before, a successive removal petition is plainly

proper. See O’Bryan, 496 F.2d at 409. No different

conclusion is warranted simply because the result was

obtained through a class certification order, rather than an

order permitting amendment of the complaint.

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REYES V. DOLLAR TREE STORES 9

Reyes argues that the class certification order did not

create a “new and different ground for removal” because the

proposed class definition in the amended complaint never

changed. Of course, defendants are not entitled to more than

one bite at the apple, but the superior court’s certification

order substituted a new apple. In its first remand order, the

district court accepted Reyes’s narrow construction of the

amended complaint. When the superior court later certified

a broader class, it increased the amount in controversy,

effectively amending the complaint. See Rea, 742 F.3d at

1238 (finding that a Supreme Court decision invalidating the

damages waiver in the complaint created a new ground for

removal, despite a prior removal attempt on the basis of the

same complaint); Kirkbride, 933 F.2d at 731–32 (permitting

a successive removal because intervening legislation

established jurisdiction over a complaint that was previously

held not removable). Because the first remand was on

“grounds that subsequently became incorrect,” the successive

removal was permissible. Rea, 742 F.3d at 1238.

B.

Our second conclusion—that removal was timely—

follows logically from the first. The removal statute provides

for two thirty-day windows during which a case can be

removed: (1) during the first thirty days after the defendant

receives the initial pleading, or (2) during the first thirty days

after the defendant receives “an amended pleading, motion,

order or other paper from which it may first be ascertained

that the case is one which is or has become removable.” 

28 U.S.C. § 1446(b) (emphasis added); see also Harris v.

Bankers Life & Cas. Co., 425 F.3d 689, 692 (9th Cir. 2005). 

The district court found that the time to remove was

conclusively triggered when the amended complaint was first

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10 REYES V. DOLLAR TREE STORES

filed. But this ignored the significance of the class

certification order, which created a new amount in

controversy not presented in the amended complaint as

construed by the district court on the first remand motion. 

See Sullivan v. Conway, 157 F.3d 1092, 1094 (7th Cir. 1998)

(noting that the time begins to run upon occurrence of an

event “that discloses that the case is or has become

removable”). Because Dollar Tree removed within thirty

days of the class certification order, the removal was timely. 

See Rea, 742 F.3d at 1237–38; Roth v. CHA Hollywood Med.

Ctr., L.P., 720 F.3d 1121, 1125–26 (9th Cir. 2013).

We are unpersuaded by Reyes’s claim that the removal

was rendered untimely by either the superior court’s tentative

ruling on the class certification motion or Reyes’s reply brief

in support of class certification. The tentative ruling had no

jurisdictional effect precisely because it was tentative. See

Sullivan, 157 F.3d at 1094 (declining to start the clock before

a motion to amend was granted because, “[u]ntil the state

judge granted the motion to amend, there was no basis for

removal”). And although a footnote in the reply brief, taken

out of context, might be read to signal Reyes’s belief that the

jurisdictional amount is satisfied,1it appears near the end of

a brief that repeatedly argues for certification of precisely the

narrow class that had already been determined not to satisfy

the jurisdictional threshold. The footnote did not provide a

sufficient basis for ascertaining removability. See Kuxhausen

v. BMW Fin. Servs. NA, LLC, 707 F.3d 1136, 1141 (9th Cir.

1 The footnote states that “Plaintiff believes that . . . 969,000 shifts

would be eligible for a rest break premium.” If almost one million shifts

were eligible for an additional hour of wages, the amount in controversy

would be substantially greater than $5,000,000.

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REYES V. DOLLAR TREE STORES 11

2013); Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876,

886 (9th Cir. 2010).

III.

Because Dollar Tree offers an “unchallenged, plausible

assertion” that the jurisdictional requirements of CAFA are

met, the district court has subject-matter jurisdiction. Ibarra,

775 F.3d at 1197–98; see also Dart Cherokee Basin

Operating Co. v. Owens, 135 S. Ct. 547, 554 (2014) (citing

28 U.S.C. § 1446(a)). We therefore REVERSE the district

court’s order remanding this case to state court, and

REMAND with instructions for the district court to exercise

jurisdiction.

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