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Rea v. Michaels Stores Inc.

United States Court of Appeals, Ninth Circuit

February 18, 2014

P. REA; S. SADLOWSKI; D. SPERLINE; A. SARABIA, Plaintiffs-Appellees,
v.
MICHAELS STORES INC., a Delaware corporation, Defendant-Appellant

Argued and Submitted February 3, 2014, Pasadena, California

Page 1235

Appeal from the United States District Court for the Central District of California. D.C. No. 8:13-cv-00455-GW-AGR. George H. Wu, District Judge, Presiding.

Jesse A. Cripps, Gibson, Dunn & Crutcher LLP, Los Angeles, California, for Defendant-Appellant.

David J. Gallo, Law Offices of David J. Gallo, Del Mar, California, for Plaintiffs-Appellees.

Before: Andrew J. Kleinfeld, Barry G. Silverman, and Andrew D. Hurwitz, Circuit Judges.

OPINION

Page 1236

PER CURIAM:

Plaintiffs brought the present action against Michaels Stores, Inc. on behalf of Michaels' California store managers, alleging that Michaels had improperly classified the managers as exempt from overtime. Michaels removed the case within 30 days to federal district court under the Class Action Fairness Act. The district court remanded the case back to state court, finding that CAFA's $5,000,000 amount-in-controversy requirement was not met because the plaintiffs expressly disclaimed any recovery for the class over $4,999,999.99.

On March 19, 2013, the Supreme Court held in Standard Fire Insurance Co. v. Knowles that attempted damages waivers, such as the plaintiffs', are ineffective, and will not defeat removal under CAFA. 133 S.Ct. 1345, 1347, 185 L.Ed.2d 439 (2013). The next day, Michaels removed again under the Class Action Fairness Act. And the district court remanded again, this time on the basis that the removal ran afoul of CAFA's 30-day time limit. The court held in the alternative that Michaels had failed to carry

Page 1237

its burden to demonstrate that the amount in controversy exceeded $5,000,000.

Michaels appeals. We have jurisdiction under 28 U.S.C. § 1453(c). We review the remand decision de novo, Serrano v. 180 Connect, Inc., 478 F.3d 1018, 1020 (9th Cir. 2007), but review the district court's factual findings for clear error, Fed. R. Civ. Pro. 52(a)(6). " Under CAFA, we have 60 days from the time we accept the appeal to complete all action on such appeal, including rendering judgment." Lowdermilk v. United States Bank Nat'l Ass'n, 479 F.3d 994, 996 (9th Cir. 2007), abrogated on other grounds by Standard Fire Insurance Co., 133 S.Ct. 1345, 185 L.Ed.2d 439 (internal quotation marks omitted).

As a preliminary matter, we must consider the plaintiffs' argument that this appeal is now moot in light of post-remand developments. We have already considered this argument once before on a motion to dismiss Michaels' petition to appeal, which we denied in a two-judge order. However, " [t]he fact that the motions panel denied the... motion to dismiss this appeal does not free this court from the independent duty to decide whether we have ...


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