Opinion ID: 774566
Heading Depth: 3
Heading Rank: 3

Heading: Attorneys' Fees as a Basis for Amount in Controversy for Named Plaintiffs

Text: 61 Chrysler does not contend that any of the named plaintiffs in this case has an individual claim for damages that exceeds $75,000. Chrysler does contend, however, that the entirety of any award of attorneys' fees should be allocated to the named plaintiffs, and that this amount will exceed $75,000 per named plaintiff. We have no doubt that attorneys' fees would exceed $75,000 per named plaintiff in this case if removal to federal court were upheld and class certification were granted. But we do not agree with Chrysler that under California law an award of attorneys' fees in a class action is allocated solely to the named plaintiffs. 62 This circuit specifically rejected Chrysler's argument almost twenty years ago, in Goldberg v. CPC Int'l, Inc., 678 F.2d 1365 (9th Cir. 1982). We articulated a single reason for our holding in Goldberg: allocating attorneys' fees solely to the named plaintiffs would seriously undermine .. . the rule expressed by the Supreme Court in Zahn. Id. at 1367. However, because we hold today that §§ 1367 has overruled Zahn, we must take another look at Goldberg. 63 Abbott Laboratories provides a useful starting place. There, the Fifth Circuit held that the named plaintiffs' claims satisfied the amount-in-controversy requirement because the attorneys' fees were allocated solely to the named plaintiffs, or representative parties, under Louisiana law. Abbott Laboratories at 526; La. Code Civ. Proc art. 595; La. Rev. Stat. §§ 51:137. In so holding, the Fifth Circuit concluded that Goldberg 64 sheds little light on the distinct policy choices behind Louisiana's decision regarding rights of recovery by class members. That a state chooses a set of rules that result in an award in excess of [the jurisdictional requirement] frustrates no policy of Zahn. Simply put, under the law of Louisiana the class representatives were entitled to fees. Their rights of recovery were not created by a judge's summing the discrete rights of class members. 65 Id. at 526-27. 66 In the case now before us, plaintiffs amended their complaints after the first remand to include claims under Cal. Civ. Proc. Code §§ 1021.5. That section states, in relevant part: 67 Upon motion, a court may award attorneys' fees to a successful party against one or more opposing parties in any action which has resulted in the enforcement of an important right affecting the public interest if: (a) a significant benefit, whether pecuniary or non-pecuniary, has been conferred on the general public or a large class of persons, (b) the necessity and financial burden of private enforcement . . . are such as to make the award appropriate, and (c) such fees should not in the interest of justice be paid out of the recovery, if any. 68 (Emphasis added). In its opposition to the second remand, Chrysler argued that the district court should attribute the §§ 1021.5 attorneys' fees only to the named plaintiffs. We disagree. Section 1021.5 states only that attorneys' fees go to a successful party. In this respect, it is different from the Louisiana statute at issue in Abbott Laboratories , which states: 69 The court may allow the representative parties their reasonable expenses of litigation, including attorney's fees, when as a result of the class action a fund is made available, or a recovery or compromise is had which is beneficial, to the class. 70 La. Code Civ. Proc. art. 595 (emphasis added). 71 California courts have stated that§§ 1021.5 awards are a bounty for plaintiffs who successfully litigate in the public interest, see, e.g., Galante Vineyards v. Monterey Peninsula Water Mgmt. Dist., 60 Cal. App. 4th 1109, 1127 (1997), but they have not held that this bounty goes only to named plaintiffs in a class action. We therefore hold that under California law, attorneys' fees are not awarded solely to the named plaintiffs in a class action, and that they therefore cannot be allocated solely to those plaintiffs for purposes of amount in controversy. See Spielman v. Genzyme Corp., 251 F.3d 1, 8 (1st Cir. 2001) (refusing to allocate attorneys' fees in class action solely to the class representatives based on langauge in Massachusetts statute awarding attorneys fees to petitioner in a class action); H & D Tire and Automotive-Hardware Inc. v. Pitney Bowes, Inc., 227 F.3d 326, 330 (5th Cir. 2000) (same result for Connecticut statute awarding attorneys fees to plaintiff in a class action); Cohen v. Office Depot, Inc., 204 F.3d 1069, 1080 & 1080 n.11 (11th Cir. 2000) (same result for Florida statutes awarding fees to prevailing party or [a]ny person prevailing); Darden v. Ford Consumer Fin. Co., 200 F.3d 753, 758 n.4 (11th Cir. 2000) (same result for Georgia statute awarding fees toany person who is injured). 72 We agree with Chrysler's argument that §§ 1367 provides supplemental jurisdiction over the jurisdictionally insufficient claims of unnamed class members if the named plaintiffs in the action have claims that satisfy the amount-in-controversy requirement. In that respect, we disagree with the district court. But because we hold that California law requires any attorneys' fees awarded in this action to be divided among all members of the class, we do not agree that the named plaintiffs in this case satisfy the amount-in-controversy requirement. Since this is the sole argument advanced by Chrysler to show that the claims of the named plaintiffs satisfy the amount-in-controversy requirement, the district court did not err in finding that there was no supplemental jurisdiction under §§ 1367.