ATLAS DATA PRIVACY CORPORATION v. TRANSUNION, LLC.
1:24-cv-04288
D.N.J.Nov 20, 2024Background
- Plaintiffs, led by Atlas Data Privacy Corporation, filed forty lawsuits in New Jersey state court asserting violations of Daniel's Law, which protects home addresses and unlisted numbers of certain public employees and their families.
- Defendants, all corporations (several incorporated in Delaware, as is Atlas), removed these cases to federal court asserting subject matter jurisdiction under diversity (28 U.S.C. § 1332(a)) and the Class Action Fairness Act (CAFA, 28 U.S.C. § 1332(d)).
- Atlas, a Delaware corporation with its principal place of business in New Jersey, acts as the assignee for Daniel's Law claims from over 19,000 covered persons; individual New Jersey plaintiffs also joined.
- Plaintiffs moved to remand the cases to state court, arguing lack of subject matter jurisdiction due to incomplete diversity and neither class nor mass action status under CAFA.
- The court consolidated the remand motions and allowed limited jurisdictional discovery regarding party citizenship, assignment arrangements, and allegations of collusion or fraudulent joinder.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Atlas as real party in interest | Atlas’s citizenship should count for diversity; as absolute assignee, it is the proper party | Citizenship of covered persons should count, not Atlas, as Atlas is not real party in interest | Atlas is real party in interest; citizenship defeats diversity |
| Collusive assignment to defeat diversity | Assignments and Atlas’s joinder were made in good faith business purpose | Assignment and joinder were collusive, meant to keep cases in state court | No evidence of collusion; assignments valid, not collusive |
| Fraudulent joinder of non-diverse defendants | Joinder proper; allegations sufficient for claims | Certain defendants (MyHeritage USA, Thomson Reuters Holdings, Applications) were improperly joined | Fraudulent joinder found only as to MyHeritage USA; dismissed; diversity exists for that case only |
| CAFA class/mass action jurisdiction | Not class or mass actions; not brought under Rule 23 or similar | Actions are class/mass actions "in disguise" or Daniel’s Law is similar to Rule 23 | Not class/mass actions under CAFA; no CAFA jurisdiction |
Key Cases Cited
- Sprint Communications Co., L.P. v. APCC Services Inc., 554 U.S. 269 (assignment of legal claims gives standing and real party in interest status to assignees)
- Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546 (complete diversity is required for jurisdiction)
- Navarro Sav. Ass'n v. Lee, 446 U.S. 458 (real party in interest determines citizenship for diversity)
- Kramer v. Caribbean Mills, Ltd., 394 U.S. 823 (collusive assignments that create federal jurisdiction are ineffective)
- Mississippi ex rel. Hood v. AU Optronics Corp., 571 U.S. 161 (mass action under CAFA requires at least 100 named plaintiffs)
- Batoff v. State Farm Insurance Co., 977 F.2d 848 (fraudulent joinder exists only if claim against joined defendant is wholly insubstantial or frivolous)