Burgos v. Citibank, N.A

Background

Susana Burgos filed a proposed class action in San Mateo Superior Court alleging that Citibank violated California wage-and-hour laws. The allegations included failure to pay the correct minimum wage, overtime, and sick pay; failure to provide meal and rest breaks; failure to record missed breaks; failure to reimburse required expenses; and failure to provide accurate itemized wage statements.

Burgos proposed a California class of current and former nonexempt employees, including employees staffed by a third party, and a related California labor subclass. She alleged that the amount in controversy for each proposed group was under $5 million.

Citibank removed the case to federal court under the Class Action Fairness Act, or CAFA. CAFA allows federal jurisdiction over qualifying class actions when, among other requirements, the proposed class has at least 100 members, at least one plaintiff is a citizen of a different state from a defendant, and the amount in controversy exceeds $5 million. Burgos moved to remand, meaning to return the case to state court.

The Parties’ Arguments

Burgos challenged Citibank’s showing of the amount in controversy as unsupported and unreasonable. She particularly challenged Citibank’s use of an assumed 20% violation rate for the alleged meal- and rest-break violations and argued that Citibank should have analyzed its records to identify actual violation rates.

Citibank relied on declarations and timekeeping data. The data showed that at least 3,368 California nonexempt employees worked more than 1,071,712 workdays during the relevant period. It also showed that 1,047,759 workdays lasted at least 3.5 hours, 931,654 lasted at least 5 hours, and the average workday lasted approximately 7.2 hours.

Court’s Analysis

The court explained that when a plaintiff contests the amount alleged in a removal notice, the defendant must establish by a preponderance of the evidence that the amount in controversy exceeds the jurisdictional threshold. The court may use reasonable assumptions; the defendant does not have to prove the amount beyond a legal certainty or identify the exact frequency of every alleged violation.

The court found Citibank’s 20% assumed violation rate reasonable because Burgos’s complaint included both allegations that violations occurred “from time to time” and allegations referring to company policies, uniform practices, and patterns of practice. Using the timekeeping data, Citibank valued the meal-break claim at $3,816,054.78 and the rest-period claim at $4,291,620.86. Those two valuations totaled more than $8 million and therefore exceeded CAFA’s $5 million requirement.

Because the meal- and rest-break claims alone satisfied the amount-in-controversy requirement, the court did not address Burgos’s remaining arguments concerning waiting-time penalties or attorney’s fees.

Rulings

The court DENIED Burgos’s motion to remand. It also DENIED Citibank’s supplemental request for judicial notice because Citibank filed it after briefing closed without obtaining the court’s permission, and the court did not consider the materials covered by that request. The court GRANTED Citibank’s earlier request for judicial notice of a prior minute order.