In the

United States Court of Appeals

For the Seventh Circuit ____________

No. 08-1019

THOMAS SPRINGMAN, individually and on behalf

of all others similarly situated,

Plaintiff-Appellant,

v.

AIG MARKETING, INC. and ILLINOIS NATIONAL

INSURANCE CO.,

Defendants-Appellees.

____________

Appeal from the United States District Court

for the Southern District of Illinois.

No. 07-737-GPM—G. Patrick Murphy, Judge.

____________

ARGUED APRIL 4, 2008—DECIDED APRIL 15, 2008

____________

Before POSNER, ROVNER, and EVANS, Circuit Judges.

POSNER, Circuit Judge. The plaintiff filed this class action

suit in an Illinois state court in July 2003 against AIG

Claim Services (AIGC), a company that processes insurance

claims, as well as against Illinois National Insurance

Company, which issues insurance policies; the policies

give rise to claims for payment. The complaint charged

the defendants with having violated Illinois fraud and

consumer protection law by underpaying accident-insur-
2 No. 08-1019

ance claims submitted by the plaintiff and the members

of his class.

In December 2003, in response to an interrogatory

served by the plaintiff, AIGC stated that it had not handled

his insurance claim. But not until October of the next

year did he serve an interrogatory asking who had handled

it. AIGC and Illinois National responded the following

month that the claim had been handled by an affiliate of

AIGC called AIG Marketing (AIGM). Three years (less two

months) later, and thus nearly four years after first being

told that he had sued the wrong party, the plaintiff moved

the court for leave to amend his complaint to add AIGM as

a defendant and drop AIGC. The court granted the motion.

In the meantime, however, Congress had passed the

Class Action Fairness Act, which allows certain types of

class action suit filed in state court and governed by

state law to be removed to federal district court despite

the absence of complete diversity, 28 U.S.C. §§ 1331(d),

1453, provided the suit was “commenced” on or after

the Act’s effective date, which was February 18, 2005. Both

the plaintiff and Illinois National are citizens of Illinois,

though neither of the AIG companies is. AIGC therefore

could not have removed the case to federal court because

the suit against it was filed before the Act’s effective date

and thus at a time when complete diversity was required for removal of a diversity case. But AIGM was

substituted for AIGC after that date. So, promptly after

the amendment of the complaint (and incidentally before

a class had been certified), AIGM removed the case to

federal district court, which denied the plaintiff’s motion to

remand to state court, precipitating this appeal under

28 U.S.C. § 1453(c)(1). The question we have to answer

is whether the substitution of AIGM for AIGC was the
No. 08-1019 3

commencement of a suit against AIGM within the meaning of the Class Action Fairness Act, thus enabling removal of the entire suit. 28 U.S.C. § 1453(b).

That the suit had been filed before the Act’s effective date

might seem to doom removal. But the plaintiff does not

argue that; he bows to our case law, which rejects the

position that nothing that happens after suit is filed can

affect removal. E.g., Phillips v. Ford Motor Co., 435 F.3d

785, 786-88 (7th Cir. 2006); Knudsen v. Liberty Mutual Ins.

Co., 411 F.3d 805, 806-07 (7th Cir. 2005). All but one of the

other circuits to have addressed the question agree with us.

Smith v. Nationwide Property & Casualty Ins. Co., 505 F.3d

401, 405-06 (6th Cir. 2007); Prime Care of Northeast Kansas,

LLC v. Humana Ins. Co., 447 F.3d 1284, 1285-86 (10th Cir.

2006); Braud v. Transport Service Co., 445 F.3d 801, 803-04

(5th Cir. 2006); Plubell v. Merck & Co., 434 F.3d 1070, 1071-72

(8th Cir. 2006). The outlier is the Ninth Circuit. E.g., McAtee

v. Capital One, F.S.B., 479 F.3d 1143, 1145-48 (9th Cir. 2007).

The cases that allow removal under the Class Action

Fairness Act on the basis of certain events that take place

after the case was filed are consistent with federal removal

doctrine; “an amendment to the pleadings that adds a

claim under federal law (where only state claims had been

framed before), or adds a new defendant, opens a new

window of removal.” Knudsen v. Liberty Mutual Ins. Co.,

supra, 411 F.3d at 807; see 28 U.S.C. § 1446(b). The Ninth

Circuit, however, believes that a simpler approach, one

that disregards post-filing developments, is warranted

because all that is at stake in removal under the Class

Action Fairness Act is whether the same case, governed

by state law, will be litigated in a state court or in a federal court. But that is all that’s at stake whenever a suit

is removed to federal court on the basis of diversity.
4 No. 08-1019

Nowhere does the Act state or suggest that removal

pursuant to it is more limited than in the usual diversity

case. On the contrary, the Act lengthened the time

within which a normal diversity suit can be removed, 28

U.S.C. § 1453(b), as well as making a particular class of

diversity cases, namely class actions in which diversity

is only partial, removable to federal court for the first time.

On the Ninth Circuit’s view, a plaintiff can defeat

removal by first filing a complaint that does not include

a claim or a defendant that would trigger the Act’s right of

removal and later substituting a claim or defendant that

would have triggered the right. Suppose that with the

Act’s effective date looming, the plaintiff had not completed even a minimal pre-complaint investigation. Under

the Ninth Circuit’s view, the plaintiff could sue Donald

Duck for violating a Chicago noise ordinance and then

at his leisure amend the complaint to substitute a proper

claim against a proper defendant, and the new defendant would not be able to remove.

But even the cases that reject the Ninth Circuit’s position

forbid removal if the new claim or defendant (new in the

sense of having been added after the effective date of the

Class Action Fairness Act) “relates back” to the original

claim or the original defendant. It would not do so in the

Donald Duck case, although that would not faze the

Ninth Circuit, which considers relation back important

only when necessary to avoid a statute of limitations

defense, since, if successful, the defense kills the plaintiff’s

claim rather than just forcing it to be litigated in a different

court system. McAtee v. Capital One, F.S.B., supra, 479 F.3d

at 1147.

The majority view, because it makes relation back

important, raises a threshold question: should state or

federal law govern whether a claim or defendant relates
No. 08-1019 5

back? The cases thus far have assumed that it is state law,

e.g., Schorsch v. Hewlett-Packard Co., 417 F.3d 748, 750-51

(7th Cir. 2005); Plubell v. Merck & Co., supra, 434 F.3d at

1071, but with little discussion of the issue, probably

because its resolution rarely matters (it doesn’t matter

in this case, as we shall see). What may have influenced

the assumption is that state law determines the date on

which a diversity suit was commenced for purposes of

determining whether the statute of limitations has run.

Walker v. Armco Steel Corp., 446 U.S. 740 (1980). The statute

of limitations, however, is a substantive defense the

application of which depends on the length of time that

elapsed between the date on which the plaintiff’s claim

accrued and the date on which he filed suit. If state law

governs the statute of limitations defense, as it normally

will in a diversity case, it makes sense to defer to the state

law’s determination of when a claim accrues and when a

suit is commenced, for those are the dates that determine

whether the suit is barred by the statute. But the validity of

a state-law defense is not the issue when the district court

is asked to decide in which court system, the federal or the

state, the case shall be litigated. Suppose that in an effort to

delay the effective date of the Class Action Fairness Act,

a state court defined “relation back” so broadly that even

the replacement of Donald Duck by AIGM would relate

back to the date of the original complaint and therefore AIGM could not remove. That would defeat the Act’s

goal, and as the Act is silent on relation back, the interpretation that is consistent with that goal is permissible as

well as preferable.

We need not choose between state and federal law (we

are merely flagging the issue for possible consideration

in the future) because Illinois’s relation-back rule is identi-
6 No. 08-1019

cal to the federal rule. Both rules provide that a party may

be changed if, within the deadline for service of the

complaint on it, (1) the new party had received enough

notice of the original suit that it would not be “prejudiced

in maintaining a defense on the merits” if it were brought

into the case belatedly, and (2) it “knew or should have

known that, but for a mistake concerning the identity of

the proper party, the action would have been brought

against” it. 735 ILCS 5/2-616(d)(2); Fed. R. Civ. P.

15(c)(1)(C). The plaintiff argues that these conditions

have been satisfied.

The first may have been, but not the second. The plaintiff learned by December 2003, or at the latest by November 2004, that he had sued the wrong party, yet he

waited almost three years to substitute the right one. He

offers no excuse for having waited so long to correct

his mistake. Neither party can explain the delay.

No matter, says the plaintiff; the rule imposes no duty

of diligence. Not in so many words; that is true. But we

must have regard for context, and in particular we

must ask why there is a relation-back doctrine in the first

place. The primary reason is to provide relief from a

defense based on the statute of limitations in cases in

which the deadline imposed by it is too tight. Just as a

statute of limitations fixes a deadline for suing, the

Class Action Fairness Act fixes a deadline for bringing

a suit that cannot be removed to federal court, and so the

relation-back issues are the same, at least when as in this

case the federal and state relation-back rules are the same.

The purpose of allowing relation back—to extend a

deadline—allies the doctrine closely to equitable tolling,

which permits a party to file his suit after the expiration

of the limitations period if he could not reasonably be
No. 08-1019 7

expected to have done so sooner. E.g., Fidelity National Title

Ins. Co. v. Howard Savings Bank, 436 F.3d 836, 839 (7th Cir.

2006); Neverson v. Farquharson, 366 F.3d 32, 39-40 (1st Cir.

2004). He might, for example, have known that he had

suffered a wrongful injury but have been unable to identify

the injurer in time. E.g., Singletary v. Continental Illinois

National Bank & Trust Co., 9 F.3d 1236, 1241-42 (7th Cir.

1993). But to be given the benefit of the doctrine he must be

diligent in seeking out that identity and must sue promptly

once he has learned it. E.g., Shropshear v. Corporation

Counsel, 275 F.3d 593, 595 (7th Cir. 2001); Pacific Harbor

Capital, Inc. v. Barnett Bank, N.A., 252 F.3d 1246, 1252 (11th

Cir. 2001); Johnson v. Nyack Hospital, 86 F.3d 8, 12-13 (2d Cir.

1996).

It is the same here. The plaintiff thought he had been

stiffed by whoever had handled his insurance claim,

and we’ll assume that he was unable even by the exercise

of diligence to identify the handler correctly when he

sued. The relation-back doctrine would give him the time

he needed to find out whom he should have sued, and

sue him, provided that the new defendant knew about

the suit and was not prejudiced by the delay in naming

him as a defendant. But it doesn’t give the plaintiff forever. It is implicit that he must proceed diligently. Otherwise the doctrine would undercut the tolling rules.

We have in this case a situation in which for three years

a plaintiff knows that he has sued the wrong party and

knows who the right party to sue is—for the plaintiff

does not suggest that he disbelieved AIGC when it told

him that not it but its affiliate AIGM had handled his

claim—yet he neither drops the wrong party from the case

nor adds the right one as a defendant. Throughout this

period the wrong party, though knowing it is the wrong

party, must keep tabs on the case, may have to report it
8 No. 08-1019

to insurance and securities regulators as a pending case,

or must incur the expense of seeking a dismissal, while

the right party wonders why it hasn’t been sued and

must make preparations for an eventual suit by lining up

counsel and preserving evidence. Neither the named nor

the mysteriously unnamed defendant may be able—

without disproportionate expense—to prove that it is

being prejudiced by the plaintiff’s dereliction, yet the

litigation process is being complicated and uncertainty

engendered and all for no reason.

This analysis brings us back to the language of the

relation-back rules. When there is protracted and inexplicable delay in changing defendants, the plaintiff can no

longer argue, under either the Illinois or the federal rule,

that the defendant “should have known that, but for

a mistake concerning the identity of the proper party,

the action would have been brought against th[at] party.”

When as in this case the plaintiff does not change defendants for years after discovering the mistake, the not-yetnamed defendant can no longer assume that “the action

would have been brought against” him had it not been

for the plaintiff’s mistake. After years passed without

being substituted as a defendant for AIGC, AIGM could

reasonably assume that the plaintiff had a reason for

wanting to persist in the suit against AIGC even though

that company had not handled his claim. Maybe it had

handled the claims of some members of the class, and

class counsel was thinking of substituting one of those

members for the named plaintiff and continuing with

the suit against AIGC. Maybe the plaintiff had thought

that because AIGC and AIGM are affiliated corporations

it didn’t matter which one he sued—that they could be

treated as a unit.
No. 08-1019 9

What was AIGM to do? Petition the court to direct

the plaintiff to sue it? Or should AIGC have told the

plaintiff, please sue my affiliate?

Read literally, it is true, the relation-back provision in

both the Illinois and the federal rule could be thought to

authorize relation back whenever the later-named defendant should have known within the service period that had

it not been for a mistake by the plaintiff he would have

been sued, whatever he learned later. But that would be

a misreading. It is apparent that the requirement that

the party learn of the mistake before the service deadline

has passed is a limitation on rather than an expansion of

the relation-back doctrine. There can be relation back only

if the defendant realized within the period in which he

might have been sued that he should have been the

one sued. If he didn’t learn that until later, there is no

relation back because he would assume after the service

deadline passed that he was out of the woods—it would

be too late for the plaintiff to add him as a defendant.

When years passed without AIGM’s being substituted

for AIGC, whatever initial concerns AIGM might have

had about being sued would have tended to dissipate.

No longer could it be sure that the plaintiff had sued AIGC,

rather than it, by mistake. The plaintiff’s tenacious retention of AIGC as a defendant suggested alternative

hypotheses to mistake, such as that, as we suggested,

class counsel intended to replace the plaintiff as the

named plaintiff in the class action suit with another

member of the class.

We note finally that even when the conditions for relation bank are satisfied, a request to allow the complaint to

be amended is addressed to the judge’s discretion. Foman

v. Davis, 371 U.S. 178, 182 (1962); Airborne Beepers & Video,

Inc. v. AT&T Mobility LLC, 499 F.3d 663, 666-67 (7th Cir.
10 No. 08-1019

2007); Mundt v. Ragnar Benson, Inc., 335 N.E.2d 10, 16 (Ill.

1975); Brandon v. Bonell, 858 N.E.2d 465, 484-85 (Ill. App.

2006); Grove v. Carle Foundation Hospital, 846 N.E.2d 153, 158

(Ill. App. 2006). (Federal, but not Illinois, law permits a first

amendment to be made as a matter of right before the

answer or a dispositive motion is filed. Compare Fed. R.

Civ. P. 15(a) with 735 ILCS 5/2-616(a). That is not the

nature of the amendment at issue.) It is difficult to regard

the state court’s permitting the plaintiff to amend his

complaint to change defendants as anything other than an

abuse of discretion. The plaintiff’s delay in seeking leave to

amend was gross, unjustified, and not even explained; the

maintenance for years of a suit against a party known by

the plaintiff to be the wrong one to sue was an abuse of

legal process; and the amendment changed not only the

defendants but the claimants, since the insurance claims of

some of the class members were processed by AIGC and of

others by AIGM. If as seems likely AIGM would not have

known how substituting it in as a defendant would alter

the composition of the class, that is an independent ground

for denying relation back. Smith v. Nationwide Property &

Casualty Ins. Co., supra, 505 F.3d at 406 n. 2.

Obviously we cannot reverse the state judge’s grant of

leave to amend the complaint. But the arbitrariness of that

action supports an interpretation of the Class Action

Fairness Act under which the suit against AIGM is deemed

to have been commenced when it was added as a defendant, and not years earlier when AIGC was sued.

The order of the district denying the petition to remand

this suit to the state court is

AFFIRMED.

USCA-02-C-0072—4-22-08