F OR P UBLICATION



### UNIT E D ST AT E S CO URT O F APPE AL S FO R T H E NINT H CIRCUIT

P. R E A ; S. S A

D L O W S K

I ; D. S P E R

L I N E ; A. S AR A B I A , Plaintiffs-Appellees ,

v

.
M I C HAE L S S T O R

E S I N C

. , a Delaware corporation, Defendant-Appellant

. N o. 14-55008

D.C. No. 8:13-cv-00455- GW

- AGR

OPI NI ON

Appeal from the United States District Court for the Central District of California Georg e H. W u, District J u d g e, Presiding
Argued and Submitted F ebruary 3, 2014—Pasadena, California

F iled F ebruary

18, 2014

B e fore: Andrew J . Kleinfeld, B arry G. Silverman, and Andrew D. Hurwitz , Circuit J udg es.

Per Curiam OpinionR E A V

. M I C HAE L S S T O R E S 2

SUMMARY *

C lass Action F airness Act

The panel reversed the district court’s o r d er remanding t h e case back to state c ourt, and held that the Class A c t i o n F airness Act’s amount-in-controversy requirement was met.

The panel held that the action was not moot based on the state court’s s u b sequent determination to certify the class because p ost-remand developments d o not defeat jurisdiction that was properly invoked at the time of filing

. The panel also held that the second removal of the c ase under the Class Action F airness Act (“CAF A”) was timely

. F inally , the panel h e l d that under the preponderance of the evidence standard , the appellant established that the potential dam a ges could
ex c e ed CAF A’s $5 million jurisdictional amount.

COUNSEL

J esse A

. Cripps, Gibson, Dunn & Crutcher L L P, L os Ang eles, California, for Defendant-Appellant.

David J

. Gallo, L aw Offices of David J

. Gallo, Del Mar, California, for Plaintiffs-Appellees.

* T h is su m m ary co n stitu

tes n o part o f th e o p in io n o f th e co u rt. It h as b eenp rep ared b y

co urt staf

f f o r th e co nv en i en ce o f

th e read er.R E A V

. M I C HAE L S S T O R E S 3

OP INION

PER CURI AM:

Pla intiffs b roug ht the present action ag ainst Michaels Stores, Inc. on behalf of Michaels’ California store manag ers, alleg ing that Mi c h a e l s had improperly classified the manag ers as ex empt from overtime. Michaels r emoved the case within 30 day s t o f

ederal district court under the Class Action F airness A ct. The d istrict court remanded the c a s e back to state court, f

inding that CAF A’s $5,000,000 a m o u n t-incontroversy requirement was not met because th e plaintiffs
ex p ressly disclaimed any recovery f or the class over $4,999,999.99.

On March 19, 2013, the Supreme Court held in Standard Fire Insurance Co. v. Knowles that attemp t e d damag e s waivers, such as the p l ai n t iffs’, are ineffective, and w ill not defeat r emoval under CAF A. 1 33 S. Ct. 1 3 4 5, 1347 (2013). The nex t day , Michaels removed ag a in under the Class Action F airness Act. And the distric t c o urt remanded ag ain, this time on the b asis that the r em o v a l ran afoul o f CAF A ’s 30-day time limit. The court held in the a l t e rn a tive that Michaels had f

ailed to c arry its burden to demonstrate that the amount in controversy ex ceeded $5,000,000.

Michaels a

ppeals. W e have jurisdiction under 28 U.S.C § 1453(c). W e review the remand decision de n ovo, S errano v. 180 Connect, Inc. , 478 F .3d 1 018, 1020 (9th Cir. 2007), but review the district court’s factual finding s for clear error, F ed. R. Civ. Pro. 52(a)( 6). “ Under CAF A, we have 60 day s from the time we accept the appeal to complete all action on such appeal, including rendering judg ment.” Lowdermilk v. United S t a tes Bank Nat’l A ss’n , 479 F

. 3d 994, 996 (9th Cir. 2 00 7 ),R E A V

. M I C HAE L S S T O R E S 4 abrogated on other grounds by Standard Fire Insurance Co. , 133 S. Ct. 1345 (internal quotation marks omitted).

As a preliminary matter, we must consider the plaintiffs’ argument that this appeal is now moot in lig ht of post-remand developmen t s

. W e have a lready c o nsidered this argument
onc e b e f o r e on a motion to d ismiss Michaels’ petition to appeal, which we denied i n a two-judg e order. However, “[ t ] h e f a c t that the motions panel denied the

. . . motion to dismiss this a

ppeal does n o t f

r ee this court from the independent d

uty to decide whe t h e r w e have jurisdiction.” United States v. Houser , 8 0 4 F .2d 565, 568 (9t h C i r

. 1 986) (internal quotation marks omitted).

The plaintiffs argue that after the most recent remand, the amount in controversy cann ot ex ceed $5,000,000 f or two
reasons. F irst, they point out th a t a c lass has now been certified in state court, which they con t e n d m akes the damag es waiver in their complaint bind i n g n otwithstanding Standard Fire

. Second, they argue that the cert i fied class is sig nificantly smaller than the proposed class was, so much so that it could not possibly recover more than $5,000,000. W e need not consider whether e ither of t h es e propositions a re correct, however, because the g eneral rule is that “the amount in controversy is determined from the pleading s as they ex ist at the time a petition for removal is filed.” Eagle v. Am. Tel. & Tel. Co. , 769 F .2d 541, 545 (9th Cir. 1985). This action is not moot b ased on the state court’s subsequent determination to certify the c lass because “post-filing d evelopments do not defeat jurisdiction if jurisdiction was p roperly invoked as o f the time o f filing .” V

isendi v. Bank of America, N.A. , 733 F. 3d 863, 868 (9th Cir. 2013) (internal quotation marks omitted).R E A V

. M I C HAE L S S T O R E S 5

Plaintiffs point us to a T enth Circuit case, Dudley-Barton

v. Serv. Corp. Int’l. , 653 F .3d 11 51 (10th Cir. 2011). That decisio n is inapposite. There, the Tenth Circuit dismissed a CAF A appeal a s moot when the plaintiffs had dismissed their
case in state court, not i n g that there was “no meaning f ul dispute remaining b etween the parties.” Id. at 1152. That is not the case here. T h e plaintiffs continue to claim damag e s for wag e and hour violations ag ainst the defendant a nd the defendant con tinues to dispute them. This case is therefore not moot.

As to timeliness, Michaels did remove this case within 30 day s. The r emoval statutes g enerally require a party to
remove a case within 30 d ay s o f receiving the complaint. See 28 U.S.C. § 1446, 1 453(b). The statutes provide an ex c eption t o t h i s rule: “if the case stated b y the initial pleading is n o t removable, a notice of removal may be fil e d within 30 day s a f t e r receipt by the defendant, throug h service or otherwise, of a copy of an amended pleading , motion, order or other paper from which it may first be ascertained th a t t h e case is
o n e which is or has become removable.” Id. § 1446(b) ( 3 ) (emphasis a dded). Thus, w e have held “tha t the thirty day time period [ for removal]

. . . starts to run from defendant’s receipt of t h e i n i tial pleading only when that pleading affirmatively reveals on its face the facts n ecessary for federal court jurisdiction.” H

a r r i s v. B a nkers Life & Cas. Co. , 425 F .3 d 6 89, 691–92 (9th Cir. 2005) (internal quotation marks o m i t t e d). W e also r ecently held in Roth v. CHA Hollywood Medical Center, L.P. , that the two 30-day p eriods
are not the e x clusive periods for removal. 720 F

. 3d 1121, 1124–25 ( 9th Cir. 2013). In other words, as lon g a s t h e complaint or “an amended pleading , motion, order o r o t her paper” does not reveal that the case is removable, the 30-dayR E A V

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time period never starts to run a n d the defendant may remove at any time.

He re, the district c ourt first remanded this case on g rounds that subsequently became incorrect. Michaels removed it ag ain the day after the Supreme Court announced its decision in Sta n d

a rd Fire

. W hen Michaels first received the plaintiffs’ c omplaint, it had a damag e waiver, p urporting to waive any

recovery over $4,999,999.99, one p enny shy o f the jurisdictional threshold. At the time, our decision in Lowdermilk controlled, which had held that su c h damag e waivers were valid and effective, unless the defendant could p r o v e to a “ leg al certainty” that damag es ex ceeded $5 million. Lowdermilk v. U.S. Bank Nat’l Ass’n , 479 F .3d 994, 997–99 (9th Cir. 2007). Thus, under the c ontrolling law at the time Michaels r eceived the complaint, it did not “affirmatively reveal[ ] on its face the facts ne c e s s a ry for federal court jurisdiction,” so the init i a l 30-day removal period was never trig g ered. See Harris , 42 5 F. 3 d at 691 (internal q

uotation marks omitted); Roth , 720 F .3d at 1125. B ecause the two thirty -day removal periods are nonex clusive under o ur decision in Roth , Michaels’ second CAF A removal was timely

. See Roth , 720 F .3d 1121, 1124–25. Citing our decision in Seedman v. U

. S

. D ist. Court for Cent. Dist. o

f Ca l i f ornia , 837 F .2d 4 13 (9th Cir. 1988), the plainti ff s argue that the district c ourt could not sustain a successive r emoval attempt based on the same g rounds as the first. In Seedman , we interpreted the provision in 28 U .S.C. § 1447(d) s t a t i n g that a remand order “ is not reviewable on appeal or otherwise” as pre v e n t ing the district court from considering a r emoval b ased on the same g rounds a s one the court had previously remanded. I d. at 414. Seedman d oes not dictate the result in this case because CAF A ex plicitly a llowsR E A V

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review of remand o r d e r s “ n o t w i t h s t anding section 1447(d)[ .] ” See28 U.S.C. § 1453(c)(1). Moreover, the Supreme Court’s decision in S

tandard Fire is “a relevant chang e o f circumstances

. . . ju s t i f y [ ing ] a reconsideration of a successive, g ood faith petition for removal.” Kirkbri de v

. Cont’l Cas. Co. , 933 F .2d 7 2 9 , 732 ( 9th Cir. 1991). Thus,
even if Roth did n o t control the outcome of this c ase, Michaels’ second removal would still be proper.

In its alternative holding , t h e d i s trict c ourt found that Michaels’ evidence failed to demonstrate that the amount in controversy e x ceeded the $5,000,000 threshold. T h e f actual f i n d ing s underlying the district c ourt’s determination that removal jurisdiction ex ists a r e reviewed for c lear error. See Schnabel v. Lui , 302 F .3d 1 023, 1029 (9th Cir. 2002) (“[ t] he di s t r i ct c ourt’s f

inding s of fact r elevant to subject matter jurisdiction are reviewed under the c l e arly erroneous standard.”); 13E Charles A lan Wrig ht, A r t h ur R. Miller, & Edward H. Cooper, F e deral Practice and Pro cedure § 3612 (3d ed. 2009).

I t is unclear which leg al standard, “leg al certa inty ” o r “preponderance of evidence,” the district court applied to Michaels’ evidence of the amount in controversy

. W h ile the court’s remand or d e r m entioned the preponderance of the evidence standard, at t h e time it issued its order, the Lowdermilk “leg al certainty” standard was still Ninth Circuit la w. After the district court issued its remand decision, we held in Rodriguez v. AT& T Mobility Services that the Lowdermilk “leg al certainty” t e s t i s n o long er g ood law in lig ht o f Standard F

ire , a n d that the preponderance o f the evidence standard applies instead. 728 F .3d 975, 981 (9th Cir. 2013). I f the district court applied the Lowdermilk standard, reversal would be required under Rodriguez

. I f the distr i ctR E A V

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court applied the preponderance of the evidence standard, its finding that the amount-in-controversy requirement was n ot met was clearly erroneous. Thus, reg ardless of what standard the district court applied, we are required to reverse.

To prove the amount in controversy , Michaels submitted evidence that sto r e manag e rs work more than 4 5 hours a week, which would e n title them to over $ 5,000,000 if the pl aintiffs prevailed. F irst, Michaels submitted a declaration from its Vic e P r e sident of F ield Human Resources showing that Michaels’ manag ers were e x p e cted to work at least 45 hours a week normally , and 50 hours a week du ri n g t h e holiday season. Michaels also submitted a letter sent by the p l a intiffs in connection with settlement neg otiations whe r e the plaintiffs valued their claim at over $5,000,000. And the named p laintiffs in this case all testified t h a t t hey w orked at least 45 h o urs each week. No evidenc e t o t h e contrary was submitted.

The district court faulted Michaels for only showing that the manag ers were expected to work 45 hours o r more e ach week rather than showing they actually worked that amount. B ut manag ers testified, wit h o u t contradiction, that they did work 45 hours or more each we e k

. T here was no evidence that the e x pectation of 45 hours or more was not met. Under the p reponderance of the evidence st a ndard, Michaels establi s h e d “ that the p otential damag es could e x ceed the jurisdicti o nal amount.” Lewis v. Verizon Commc’ns, Inc. , 627 F .3d 395, 397 (9th Cir. 2010). There was substantial, plausible evidence that damag es at issue ex c e e d ed $5,000,000, and n o evidence at all to the contrary

. The district
cou r t ’ s finding that the defendant failed to prove that the amount-in-controversy requirement was met was clearlyR E A V

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erroneous even under the p rep o n derance of the evidence standard.

REVERSED and REMANDED

.