United States District Court, D. Alaska
ORDER AND OPINION [RE: MOTIONS AT DOCS. 14 &
16]
JOHN
W. SEDWICK SENIOR JUDGE.
I.
MOTIONS PRESENTED
At
docket 14 plaintiff Consumer Research and Protection, Inc.
(“CRP”) moves to remand this case to the Superior
Court for the State of Alaska. The declaration of Goriune
Dudukgian supporting the motion is at docket 15. Defendant
Fred Meyer Stores, Inc. (“FMS”) opposes at docket
18. The affidavit of Marc G. Wilhelm supporting the response
is at docket 19. CRP replies at docket 25.
At
docket 16 CRP moves for summary judgment. The declaration of
Alicia Martinez supporting the motion is at docket 17.
FMS' response is at docket 27. CRP's reply is at
docket 31.
Oral
argument was not requested with respect to either motion. The
court finds that oral argument would not be of assistance.
II.
BACKGROUND
This
lawsuit was commenced in state court. It was removed to this
court on the basis of diversity jurisdiction.[1] In its complaint,
CRP seeks to represent a class described as “all
persons, and entities, who purchased lead-acid batteries from
Defendant, within the State of Alaska, and were charged a
battery ‘core charge' at any time within the 2
years preceding the filing of this Complaint and continuing
through the present.”[2] CRP alleges that FMS used a
placard to advise prospective battery purchasers that Alaska
law requires FMS to collect a “core charge” for
each battery sold, when in fact Alaska law does not require
such a charge. CRP contends that this alleged
misrepresentation of Alaska law violates Alaska's Unfair
Trade Practices and Consumer Protection Act
(“UTPCPA”).[3] Alaska law provides a private right of
action to a person who suffers an ascertainable loss of money
caused by a violation of the UTPCPA[4] in the amount of
“three times the actual damages or $500 whichever is
greater.”[5] Alaska law also authorizes a private party
to seek an injunction prohibiting the violation of the
UTPCPA.[6]
CRP
alleges that FMS charged a core charge which ranged between
$5 and $16, depending on the type of battery
purchased.[7] CRP further alleges that it paid FMS a
core charge of $15.[8] By way of relief, CRP seeks class
certification, damages for itself of $500 and a like amount
for each class member, an injunction prohibiting FMS from
representing to consumers that Alaska law requires a core
charge, disgorgement of any un-refunded core charges, and
costs and full reasonable attorney's fees as provided by
AS 45.50.537.[9]
III.
MOTION TO REMAND
Diversity
jurisdiction exists where plaintiff and defendant are
citizens of different states and the amount or value in
controversy exceeds $75, 000, exclusive of interests and
costs.[10] Here, it is undisputed that there is
diversity of citizenship, but the parties disagree about
whether the amount or value in controversy exceeds $75, 000.
Where the complaint does not specify an amount in controversy
sufficient for diversity jurisdiction, the removing party has
the burden to prove the existence of the required amount by a
preponderance of the evidence.[11]
The
first issue is whether the amount in controversy is to be
measured against the amount that the named plaintiff seeks
for himself, rather than the amount sought for the entire
class. If it is the amount sought for the named plaintiff,
then the amount is at most $515 (the statutory $500 plus a
$15 disgorgement of the core charge). However, FMS contends
that the amount in controversy is determined by reference to
the allegation in the complaint that the class's claims
involve more than $100, 000.[12] CRP's rejoinder is that
the correct reference is to the amount the complaint demands
for the named plaintiff.[13] In the Ninth Circuit when the claims
of individual class members are separate and distinct (as
here where each has a statutory claim for $500 and possibly a
disgorgement claim based on his or her own purchase of a
battery), the individual claims may not be aggregated for
purposes of establishing the amount in
controversy.[14]
The
second issue concerns the award of attorney's fees sought
in the Complaint. FMS takes the position that the amount of
attorney's fees in controversy is the amount that might
be awarded at the conclusion of the litigation. CRP argues
that the amount is the amount of attorney's fees incurred
at the time of removal, relying primarily on the decision by
the Seventh Circuit in Gardynske-Leschuk v. Ford Motor
Co.[15] For its part, FMS says this court should
not rely on out-of-circuit authority when the Ninth Circuit
has held on more than one occasion that the total amount that
may be recovered is the amount to consider. CRP has
accurately distinguished each of the Ninth Circuit cases
relied upon by FMS, showing that none of them actually stand
for the proposition advocated by FMS.[16] Most
importantly, with respect to this issue, the Ninth Circuit
recently wrote: “It remains an open question whether
attorney's fees that are anticipated but unaccrued at the
time of removal or filing in federal court, such as those at
issue in this case, may be included in the
amount-in-controversy.”[17] The appellate court went on to
say that it was unnecessary for it to resolve that
“open question” in the case before
it.[18]
District
courts within the Ninth Circuit have noted that the other
circuit courts are divided on the issue, as are the district
courts within the Ninth Circuit.[19] This court finds the
Seventh Circuit decision in
Gardynsky-Leschuk[20] and several recent decisions
by other district courts within the Ninth
Circuit[21] highly persuasive. Based on those
authorities, this court concludes that attorney's fees
associated with post-removal legal services may not be
included in determining the amount in controversy. FMS does
not contend that the attorney's fees through the time of
removal are large enough to reach the jurisdictional
threshold.
CRP
seeks equitable relief in addition to damages. However, FMS
does not advance any argument concerning the value of the
equitable relief sought. Because the burden is on FMS to
prove the amount in controversy, its failure to offer any
evidence pertaining to ...