Remillard v. The Charles Machine Works

Background

Christopher Lee Remillard filed a putative wage-and-hour class action in Sonoma County Superior Court. The complaint asserted nine state-law claims. The defendants removed the case to federal court under the Class Action Fairness Act, a federal law that permits federal jurisdiction over certain class actions.

Remillard moved to remand, meaning he asked the federal court to return the case to state court. He argued that the defendants had not shown that the amount in controversy exceeded $5 million, one of the Class Action Fairness Act’s jurisdictional requirements.

Court’s Analysis

The court explained that the amount in controversy is the maximum recovery the plaintiff could reasonably obtain, including attorney fees that may be awarded under a fee-shifting statute or contract. Because the complaint did not state that the amount in controversy exceeded $5 million, the defendants had to provide evidence and persuade the court, by a preponderance of the evidence, that the requirement was met.

The defendants estimated damages for six of the nine claims and estimated attorney fees. Their calculations included approximately $1,844,863 for unpaid minimum wages, $2,766,295 for unpaid overtime, $1,844,863 each for meal-period and rest-period violations, $1,515,300 for wage statements, and $1,046,683 for waiting-time penalties. They calculated a damages subtotal of $10,863,868 and estimated attorney fees of $2,715,967, for a total of $13,579,835.

The court found the defendants’ assumptions reasonable. They used one unpaid hour per week for the minimum-wage and overtime estimates and a 20% violation rate for meal and rest periods, rather than assuming violations occurred every time the alleged violations could arise. The court also found reasonable the estimates for inaccurate wage statements and maximum waiting-time penalties for 229 separated employees.

The court noted that the damages estimates for the four wage claims alone totaled $8,300,884, already exceeding $5 million. Therefore, the court said that reducing or eliminating the attorney-fee estimate would not change the result. The court also noted that Remillard supplied no declaration or competing evidence proposing a different violation rate or amount in controversy.

Ruling

The court held that the defendants’ notice of removal provided a reasonable basis to conclude that the amount in controversy exceeded the Class Action Fairness Act’s $5 million requirement. Judge Richard Seeborg denied Remillard’s motion to remand.