Source: https://www.judicialview.com/Court-Cases/Civil_Procedure/Johnson-v-Pushpin-Holdings-LLC/10/602762
Timestamp: 2019-01-21 17:40:53
Document Index: 145616217

Matched Legal Cases: ['§ 1453', '§ 1332', '§ 1453', '§ 1453', '§ 1453', '§ 1332']

Judicial View > Federal Cases > Civil Procedure > Johnson v Pushpin Holdings, LLC
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This class‐action suit, which had been filed in an Illinois state court, accuses Pushpin Holdings (we can ignore the other defendants—owners and affiliates of Pushpin and entities alleged to have been acting in concert with it) of having violated the Illinois Consumer Fraud Act, 815 ILCS 505/2, by operating as a debt collector in Illinois without an Illinois license, as required by 225 ILCS 425/4, and also of having committed common law torts of abuse of process and malicious prosecution in attempting to collect debts. Pushpin removed the case to federal district court under the removal provision of the Class Action Fairness Act of 2005, 28 U.S.C. § 1453(b). To be allowed to remain and litigate in federal court, Pushpin was required by other provisions of the Act to show that the amount in controversy in the litigation exceeded $5 million. §§ 1332(d)(2), (6). The district court ruled that Pushpin had failed to show this, and ordered the case remanded to the state court from which it had been removed. Pushpin asks us for leave to file an interlocutory appeal from the remand ruling, and we have decided to grant that leave, as we are authorized to do by § 1453(c)(1). The petition and response, together with the record in the district court, adequately illuminate the dispute, so we dispense with further briefing and proceed to the merits.
The class action complaint alleges that Pushpin filed in Illinois courts some 1100 small‐claims suits, all fraudulent, but that the class (which consists of the defendants in those suits) seeks “no more than $1,100,000.00 in compensatory damages and $2,000,000.00 in punitive damages,” and “will incur attorneys’ fees of no more than $400,000.00 in prosecuting the class action counts,” and therefore “the total amount of compensatory damages plus punitive damages plus attorney’s fees requested on behalf of all class members is no more than $3,500,000.00.” Of course $3.5 million is well below the $5 million threshold for removal of a state‐court class action to a federal district court under the Class Action Fairness Act. Class counsel wants the stakes to remain below that threshold so that the suit will have to be litigated in state court, class counsel’s preferred forum. Pushpin argues that the potential damages that class counsel could establish if the substantive allegations of the complaint are proved exceed $5 million, and therefore the case should remain in federal court.
One might suppose that whatever potential damages the class might have sought, remand is required because the complaint forswears any claim for more than $3.5 million. The district judge said, however, that “once the proponent [of removal, and hence opponent of remand—Pushpin] has plausibly suggested that the relief exceeds $5 million, then the case remains in federal court unless the plaintiff can show it is legally impossible to recover that much.” The term we’ve italicized appears in many cases, e.g., ABM Security Services, Inc. v. Davis, 646 F.3d 475, 478 (7th Cir. 2011); Blomberg v. Service Corp. Int’l, 639 F.3d 761, 764 (7th Cir. 2011), as does the older formula that to prevent removal the plaintiff must demonstrate to a “legal certainty” that his claim is for less than the jurisdictional amount. E.g., St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 289 (1938); Meridian Security Ins. Co. v. Sadowski, 441 F.3d 536, 541 (7th Cir. 2006). Neither “legal impossibility” nor “legal certainty” seems descriptive of what is after all just a party’s commitment not to seek damages above an amount specified by him, whether to avoid removal or for some other reason. See, e.g., BEM I, L.L.C. v. Anthropologie, Inc., 301 F.3d 548, 552 (7th Cir. 2002); Workman v. United Parcel Service, Inc., 234 F.3d 998, 1000 (7th Cir. 2000); Bell v. Hershey Co., 557 F.3d 953, 958 (8th Cir. 2009). A court can’t force a plaintiff to accept greater damages than he wants; and it might seem that class counsel in this case had made a commitment, in the passages that we quoted from the complaint, not to seek a judgment for more than $3.5 million.
Judge(s): Richard Posner
pense of a lawyer, simply defaulted. (8th cir. 2009). a court can’t force a plaintiff to accept greater aside. no matter; for they’re wrong about the rooker‐feldman court’s opinion makes no reference to arkansas law, the law see, e.g., bem i, l.l.c. v. anthropologie, inc., 301 f.3d 548, 552 him, whether to avoid removal or for some other reason. the class is certified doesn’t limit the amount of potential court under the removal provision of the class action fair‐ no. 14‐8006 year‐old decision in standard fire ins. co. v. knowles, 133 s. 6 no. 14‐8006 than $3.5 million. default judgments be vacated, and that is relief that would tional damages per class member—much less, since class claim is for less than the jurisdictional amount. e.g., st. paul other provisions of the act to show that the amount in con‐ others similarly situated, v. ited only by binding stipulation or affidavit. but what at rule. that was a mistake; and the judge was also mistaken in 998, 1000 (7th cir. 2000); bell v. hershey co., 557 f.3d 953, 958 limitation is substantive, it might. see the opinions (none a tion would have attached at the time of removal.) the rule no. 13 c 7468 — charles p. kocoras, judge. a more favorable forum—otherwise why insist that their these allegations, which if accepted push the total potential that threshold so that the suit will have to be litigated in ct. 1345 (2013), seemingly unbeknownst to the parties in our plaintiff did not irrevocably commit to obtaining less than $5 judgment. it’s true that the plaintiff is also asking that the the case remains in federal court unless the plaintiff can least is clear is that an unattested statement in a complaint concert with it) of having violated the illinois consumer up what might be millions of dollars in damages. or maybe illinois without an illinois license, as required by 225 ilcs ourselves. has spoken and we are bound. been filed in an illinois state court, accuses pushpin hold‐ tive) should be allowed to discard, without explanation or plaintiff‐respondent, ages by a procedural rule, the limitation would not affect no. 14‐8006 7 that the stakes fall under $5 million.” back doctors ltd. v. members—at least in a case like this; for remember that the cuting the class action counts,” and therefore “the total without affecting the damages claim. mate and so decided to remand the case was that most of the amount of the alleged debt was too small to justify the ex‐ come of the suit if it is litigated in federal court than to give seems descriptive of what is after all just a party’s commit‐ the court in knowles also did not discuss the tradeoff be‐ amount of compensatory damages plus punitive damages ground on which the district judge rejected pushpin’s esti‐ quired for such a decision is an expert legal judgment, and legal sophistication or lack of resources or because the in re estate of hoellen, 854 n.e.2d 774, 785 (ill. app. 2006), pushpin holdings, llc, et al., that the potential damages that class counsel could establish the merits. not affect removability under the class action fairness act. 2 no. 14‐8006 for the northern district of illinois, eastern division. 4 no. 14‐8006 nesses v. shepard, 68 f.3d 1003, 1004 (7th cir. 1995), and other in the llp, 592 f.3d 816, 818 (7th cir. 2010), since federal jurisdic‐ (7th cir. 2002); workman v. united parcel service, inc., 234 f.3d can entertain an appeal from a decision by a state court. this damages would not reach $5 million? some members of the enough information to be able to make that determination 425/4, and also of having committed common law torts of not; spread over more than 1000 class members, an addi‐ controversy reaches the statutory minimum, thus barring case, as they have not cited it. the court held that a stipula‐ in this case: give up some damages in exchange for being ____________________ may seem rather a desperate argument, since if the default advance another ground for a remand—the rooker‐feldman incur attorneys’ fees of no more than $400,000.00 in prose‐ but however this issue should be resolved as an original [of removal, and hence opponent of remand—pushpin] has class, however, might think it better to gamble on the out‐ and that the aggregate compensatory damages to which the 284 (2005); back doctors ltd. v. metropolitan property & casual‐ state court, class counsel’s preferred forum. pushpin argues removability under the class action fairness act; but if the the district judge said, however, that “once the proponent remand, or does not, thus requiring remand. we don’t have plausibly suggested that the relief exceeds $5 million, then linois courts some 1100 small‐claims suits, all fraudulent, but won’t do—and the plaintiff in this case failed to attach a have been sued by pushpin and many of whom, for lack of state ins. co., 130 s. ct. 1431 (2010). 2011); oshana v. coca‐cola co., 472 f.3d 506, 511–12 (7th cir. claim and, by doing so, being able to litigate in a forum be‐ mercury indemnity co. v. red cab co., 303 u.s. 283, 289 (1938); damages than he wants; and it might seem that class counsel eral court. maybe there they’ll be able to get the default judgments set which is not the same as saying that the amount can be lim‐ metropolitan property & casualty ins. co., supra, 637 f.3d at one might suppose that whatever potential damages the for the seventh circuit case should be litigated in federal or state court. what is re‐ notice to the other members of the class, “what could be a members of the class are just small debtors who happen to well equal or exceed that amount may be reliable enough to lieved to be more favorable to the class. no matter; the court what we are left with to guide our decision is that the petition for leave to appeal from the united states district court this, and ordered the case remanded to the state court from before posner, rovner, and tinder, circuit judges. the unlawful conduct that misled the court into issuing the have happened later would not affect federal jurisdiction, to the amount sought in the complaint, see 735 ilcs 5/2‐604; the plaintiff’s. submitted march 19, 2014 — decided april 9, 2014 ness act of 2005, 28 u.s.c. § 1453(b). to be allowed to re‐ no. 14‐8006 3 affidavit with the complaint.” back doctors ltd. v. metropoli‐ the judgment of the state court, but to obtain damages for meridian security ins. co. v. sadowski, 441 f.3d 536, 541 (7th accompanied by an affidavit signed by him—if made before tween class counsel’s giving up a part of the class damages rule: that the supreme court is the only federal court that class might have sought, remand is required because the 8 no. 14‐8006 cases cited in truong v. bank of america, n.a., 717 f.3d 377, ings (we can ignore the other defendants—owners and affil‐ ty ins. co., supra, 637 f.3d at 830; bergquist v. mann bracken, record in the district court, adequately illuminate the dis‐ tion fairness act. there is not. back doctors ltd. v. metropoli‐ tion by the named plaintiff in his complaint—even though services, inc. v. davis, 646 f.3d 475, 478 (7th cir. 2011); the class action complaint alleges that pushpin filed in il‐ matter, the supreme court has now resolved it for us in its reversed and remanded. ceed $5 million, and therefore the case should remain in fed‐ be effective, that the plaintiff “fil[e] a binding stipulation or class counsel is to get this case back into state court, and pute, so we dispense with further briefing and proceed to main and litigate in federal court, pushpin was required by have decided to grant that leave, as we are authorized to do litigation before removal, requires, for such a commitment to al attorneys’ fee. exxon mobil corp. v. saudi basic industries corp., 544 u.s. 280, but we have held that illinois law, which governed the under which the suit had been filed. if arkansas limits dam‐ able to litigate the case in what class counsel must believe is united states court of appeals of the judgments were entered before removal—for what may million for the class, and pushpin’s estimate that the damag‐ by § 1453(c)(1). the petition and response, together with the plus attorney’s fees requested on behalf of all class members but tugging against this type of objection to obtaining a below the $5 million threshold for removal of a state‐court that resulted in a judgment adverse to the plaintiff. e.g., mand” when a case has been removed under the class ac‐ tan property & casualty ins. co., 637 f.3d 827, 831 (7th cir. judgments stand, the amount of damages that the class seeks 830–31. class counsel doubtless consider it a sensible trade does not bar a federal suit that seeks damages for a fraud id. at 1349. what is surprising about the decision is that the it’s irrelevant in this case), while pushpin has alleged that that is something that class counsel can provide but not class will be greatly diminished. but remember that the aim of cir. 2006). neither “legal impossibility” nor “legal certainty” fraud act, 815 ilcs 505/2, by operating as a debt collector in plaintiff must demonstrate to a “legal certainty” that his posner, circuit judge. this class‐action suit, which had there aren’t 1100 suits against members of the class but 1300 tan property & casualty ins. co., supra, 637 f.3d at 830. the damages above the $5 million threshold, are as plausible as ____________________ ence between “binding stipulation” and “affidavit” is, but class may be entitled are not $1.1 million but $3.3 million. claims on behalf of the class are barred by the rooker‐feldman fairness act. class counsel wants the stakes to remain below even if there were a binding stipulation, there would re‐ be more) would yield an average of less than $1500 in addi‐ 383–84 (5th cir. 2013). such a suit does not seek to disturb class action to a federal district court under the class action majority opinion) in shady grove orthopedic associates v. all‐ saying that “there is a strong presumption in favor of re‐ es recoverable by the class if it prevails on the merits may counsel would take a big bite of the damages as an addition‐ ____________________ in this case had made a commitment, in the passages that we blomberg v. service corp. int’l, 639 f.3d 761, 764 (7th cir. damages that the class would be able to recover and so does ____________________ complaint forswears any claim for more than $3.5 million. 2011), as does the older formula that to prevent removal the (6). the district court ruled that pushpin had failed to show members can make an informed decision on whether the abuse of process and malicious prosecution in attempting to preclude remanding the case to the state court. the only law are statements that a plaintiff’s damages are not limited troversy in the litigation exceeded $5 million. §§ 1332(d)(2), quoted from the complaint, not to seek a judgment for more no. 14‐8006 5 tional $1.5 million in damages (though it might be of course michael b. johnson, individually and on behalf of all that the class (which consists of the defendants in those if the substantive allegations of the complaint are proved ex‐ main a question whether a named plaintiff (class representa‐ collect debts. pushpin removed the case to federal district major component of the class’s recovery,” merely to “ensure binding stipulation or affidavit (it’s unclear what the differ‐ show it is legally impossible to recover that much.” the term but this does not end the appeal, because class counsel iates of pushpin and entities alleged to have been acting in ages claim is the lack of realism in thinking that the class an interlocutory appeal from the remand ruling, and we judge will have to determine anew whether the amount in which it had been removed. pushpin asks us for leave to file we’ve italicized appears in many cases, e.g., abm security suits) seeks “no more than $1,100,000.00 in compensatory ment not to seek damages above an amount specified by defendants‐petitioners. 2006). actually all we can find in illinois statutory and case violate the rooker‐feldman rule; but that claim can be rejected remand in exchange for surrendering part of the class dam‐ is no more than $3,500,000.00.” of course $3.5 million is well rule. (this is apart from the fact that it is disputed how many damages and $2,000,000.00 in punitive damages,” and “will