ABM Security Services, Inc. v. Davis
646 F.3d 475
| 7th Cir. | 2011Background
- ABM Security Services, Inc. removed a state-court wage-litigation class action to federal court under CAFA.
- Plaintiffs allege ABM underpaid wages for pre- and post-shift work under the Illinois Minimum Wage Law (IMWL).
- The district court remanded, concluding the amount in controversy did not exceed $5 million.
- ABM amended its removal notices to refine calculations, including back-pay, interest, penalties, and potential attorneys’ fees.
- The district court criticized ABM’s penalty calculation and pre-removal attorneys’ fees as insufficient to push past $5 million.
- The Seventh Circuit held that once ABM plausibly shows the stakes exceed $5 million, the plaintiff’s estimate need not control, and the court must assess whether recovery is legally possible.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether penalties and back-pay calculations exceed $5 million. | ABM's methods show >$5M in controversy. | Penalty accrual timing and calculation are correct and push to >$5M. | Yes; ABM plausibly exceeded $5M. |
| Whether attorneys’ fees incurred pre-filing can push the amount in controversy over $5 million. | Pre-filing fees plausibly exceed $5,552. | Fees before filing are insufficient to reach threshold. | Yes; pre-filing fees may push the amount in controversy past $5M. |
| Whether the district court properly calculated the statutory 2% IMWL penalty. | ABM’s accrual method is reasonable under IMWL. | District court independently calculated correctly and found a shortfall. | No; district court did not show legal impossibility of ABM’s higher calculation. |
| Whether the removal could be sustained after considering contested jurisdictional facts under the Back Doctors standard. | Stakes exceeded $5M, so removal proper absent legal impossibility. | District court’s computation shows no legal impossibility. | Yes; once stakes plausibly exceed $5M, removal is proper unless impossible. |
Key Cases Cited
- Back Doctors Ltd. v. Metropolitan Property & Casualty Insurance Co., 637 F.3d 827 (7th Cir.2011) (define standard: proponent may estimate stakes; must show not legally impossible)
- Oshana v. Coca-Cola Co., 472 F.3d 506 (7th Cir.2006) (only pre-removal attorney’s fees within scope of amount in controversy)
- St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283 (1938) (presumption for federal-jurisdiction stakes when proponent shows plausibility)
- Blomberg v. Serv. Corp. Int'l, 639 F.3d 761 (7th Cir.2011) (stakes exceed $5M unless legally impossible)