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Everett v. Verizon Wireless

United States Court of Appeals for the Sixth Circuit · 2006 · Civil Procedure

Civil ProcedureDiversity JurisdictionRemovalAmount in ControversyAggregation of Claims28 U.S.C. § 133228 U.S.C. § 1441amount in controversy

Facts

Four plaintiffs sued their cellular service providers, alleging the providers falsely represented that they would not charge for unanswered or busy-signal calls. The complaint sought compensatory damages, injunctive relief, restitution, disgorgement, and other appropriate relief, but no plaintiff claimed more than $75,000 individually. Defendants removed on diversity grounds, and the district court found the amount in controversy satisfied based on aggregated disgorgement. By the time of appeal, only Thomas Everett and Dobson Cellular Systems, Inc. remained.

Issue

Whether the district court had diversity jurisdiction when no individual plaintiff's claim exceeded $75,000 and the removing defendant relied on aggregation of plaintiffs' disgorgement claims, punitive-damages claims, or the total cost of complying with requested injunctive relief to satisfy the amount-in-controversy requirement.

Rule

In a diversity case, at least one plaintiff's claim must independently satisfy the amount-in-controversy requirement unless multiple plaintiffs unite to enforce a single title or right in which they have a common and undivided interest. Claims are not aggregable merely because plaintiffs seek similar relief, a common fund may result from the litigation, or the remedy is framed as disgorgement or punitive damages; the relevant inquiry is the nature and source of the right asserted. A removing defendant bears the burden of proving by a preponderance of the evidence that the amount in controversy more likely than not exceeds $75,000.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Eight tenants in Columbus, Ohio sue North Canal Property Services, a Nevada corporation, in Ohio state court. Each tenant alleges separate lease overcharges of less than $10,000 and seeks restitution under his or her own lease, and the company removes on diversity grounds by adding all tenants' claims together.

Is removal proper based on aggregation of the tenants' restitution claims?

Explanation. The governing rule is that multiple plaintiffs' claims cannot be aggregated to satisfy § 1332 unless they unite to enforce a single title or right in which they have a common and undivided interest. Here, each tenant's right arises from a separate lease and each could sue individually for his or her own overcharge. Similarity of facts and remedies does not create a common and undivided interest. (Derived from Everett v. Verizon Wireless (n.d.).)