ATLAS DATA PRIVACY CORPORATION v. LEXISNEXIS RISK DATA MANAGEMENT, LLC, 1:24-cv-06160

Forty related cases were filed by Atlas Data Privacy Corp. and several law enforcement officers in New Jersey state court, alleging violations of Daniel’s Law (a state statute restricting disclosure of personal information of law enforcement and similar personnel).
The cases were removed to federal court by defendants, citing diversity jurisdiction (28 U.S.C. § 1332(a)), the Class Action Fairness Act (CAFA), or both; in each, both a Delaware-citizen plaintiff (Atlas) and at least one Delaware-citizen defendant were involved.
Atlas acts as the assignee of over 19,000 Daniel’s Law claims from covered persons and also provides data privacy services to them, including monitoring data brokers and managing takedown requests.
Defendants argued Atlas was joined collusively to defeat federal jurisdiction or fraudulently joined non-diverse entities to defeat diversity; in two cases, fraudulent joinder of specific non-diverse defendants was specifically alleged.
Plaintiffs moved to remand, contending (1) complete diversity is lacking, (2) no jurisdiction under CAFA, and (3) no fraudulent or collusive joinder exists.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Real party in interest for diversity jurisdiction	Atlas is the real party in interest; Atlas’s citizenship controls	Assignors (covered persons) are real parties in interest; their citizenship controls	Atlas is the real party in interest; its citizenship (Delaware/NJ) destroys diversity
Collusive assignment/joinder to destroy diversity	Assignments and joinder were made in good faith for business and statutory purposes	Assignments to Atlas and its joinder were collusive, intending to defeat federal jurisdiction	Assignments/joinder to Atlas were not collusive; no evidence of improper motive
Fraudulent joinder of non-diverse defendants	All joined defendants are properly included; claims are colorable	Non-diverse defendants had no connection to alleged conduct; joined solely to destroy diversity	Only in MyHeritage case was joinder fraudulent; that defendant dismissed; remand denied in that case
CAFA—class/mass action jurisdiction	Not a class/mass action; assignments are absolute, no representative element	These are class/mass actions in disguise or under a similar statute to Rule 23	Cases not filed as class/mass actions; CAFA does not confer jurisdiction

Sprint Communications Co., L.P. v. APCC Services, Inc., 554 U.S. 269 (assignees with absolute rights are real parties in interest and may establish standing for diversity)
Kramer v. Caribbean Mills, Ltd., 394 U.S. 823 (collusive assignment to create jurisdiction is not permitted; motives must be evaluated)
Mississippi ex rel. Hood v. AU Optronics Corp., 571 U.S. 161 (for a mass action under CAFA, there must be 100 named plaintiffs, not unnamed persons)
Navarro Sav. Ass’n v. Lee, 446 U.S. 458 (citizenship of real party in interest, not nominal parties, controls diversity)
Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546 (complete diversity requirement)