Dart Cherokee Basin Operating Co. v. Owens
135 S. Ct. 547
| SCOTUS | 2014Background
- This case concerns whether a notice of removal under CAFA must include evidentiary proof of the amount in controversy.
- Dart Cherokee Basin Operating Co. and Cherokee Basin Pipeline removed a Kansas class action alleging underpayment of royalties.
- The removal notice asserted CAFA jurisdiction with an amount in controversy over $5 million.
- Owens moved to remand, arguing the notice lacked evidentiary support.
- The district court remanded based on the claimed evidentiary deficiency; the Tenth Circuit denied review, later vacated, and this Court granted certiorari.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether removal notices must include evidence of the amount in controversy. | Owens: notice deficient for lacking proof. | Dart: a plausible short-and-plain statement suffices; evidence is not required unless contested. | No; a plausible allegation suffices; evidence is required only if challenged. |
| Whether the Tenth Circuit abused its discretion in denying review of the remand order. | Dart contends denial rested on erroneous law. | Owens argues to uphold proper remand standards. | The Tenth Circuit abused its discretion by effectively adopting an erroneous removal-rule. |
| Whether the Court has jurisdiction to review the CAFA-remand decision on appeal under §1453(c). | Jurisdictional pathway exists to review remand under CAFA. | Questionable jurisdiction due to discretionary review basis. | Court has jurisdiction to review the denial of CAFA-remand appeal. |
Key Cases Cited
- Laughlin v. Kmart Corp., 50 F.3d 871 (1995 (10th Cir.)) (amount in controversy must be established on face of removal petition or notice)
- Mt. Healthy City Bd. of Ed. v. Doyle, 429 U.S. 274 (1977) (sum claimed controls if claim is in good faith)
- St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283 (1938) (establishing good-faith standard for amount in controversy)
- Standard Fire Ins. Co. v. Knowles, 568 U.S. ---- (2013) (CAFA removal generally favored; court may review jurisdictional facts)
- BP America, Inc. v. Oklahoma ex rel. Edmondson, 613 F.3d 1029 (2010 (10th Cir.)) (relevant to CAFA appellate review framework)
- McPhail v. Deere & Co., 529 F.3d 947 (2008) (discussing burdens of proof for removal)