Judon v. Travelers Property Casualty Co. of America
2014 U.S. App. LEXIS 23554
| 3rd Cir. | 2014Background
- CAFA removal case involving Travelers and Judon in which Travelers removed to federal court.
- District Court remanded, finding CAFA burdens disputed; remand order later reviewed by court of appeals.
- Issues centered on proper CAFA burden standards (McNutt vs. Red Cab framework) and when Red Cab/Knowles apply.
- Judon alleged a class of at least 200 members and that damages could exceed $5,000,000 when trebled/punitive considered.
- Court must determine whether numerosity and amount-in-controversy are satisfied, and whether jurisdiction should be remanded for further proceedings or re-removal is possible.
- Court ultimately affirms in part, vacates in part, and remands for potential further jurisdictional proceedings or remand to state court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Which burden standard applies to CAFA numerosity? | Judon contends no battle over numerosity; district court erred. | Travelers argues Samuel-Bassett preponderance applies to numerosity. | Legal certainty framework governs numerosity when disputed. |
| How is the amount in controversy to be determined under CAFA? | Judon disputes per-member damages and overall aggregation. | Travelers asserts per-member damages up to $20,000 and punitive/treble damages. | Need for a preponderance of evidence to show amount exceeds $5,000,000; cannot rely on guesses. |
| What is the correct framework for contested jurisdictional facts in CAFA removals? | Judon did not dispute the class size; facts not sufficiently disputed. | Travelers relied on removal notice and plaintiff's complaint. | Red Cab legal certainty framework applies when jurisdictional facts are contested; otherwise McNutt applies. |
| Is CAFA discovery or further fact-finding appropriate before remand? | Not explicitly stated; focus on existing pleadings. | Travelers could pursue jurisdictional discovery but failed to do so. | Remand with potential for jurisdictional discovery or re-removal upon new facts. |
Key Cases Cited
- Fre Frederico v. Home Depot, 507 F.3d 188 (3d Cir. 2007) (established preponderance vs. legal certainty for CAFA)
- Morgan v. Gay, 471 F.3d 469 (3d Cir. 2006) (defendants bear burden to prove legal certainty when amount is contested below threshold)
- Samuel-Bassett v. Kia Motors America, Inc., 357 F.3d 392 (3d Cir. 2004) (analyzed amount-in-controversy framework pre-CAFA)
- McNutt v. General Motors Acceptance Corp. of Indiana, 298 U.S. 178 (U.S. 1936) (burden to prove jurisdictional amount when challenged)
- St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283 (U.S. 1938) (legal certainty standard for amount in controversy)
- Knowles (Standard Fire Ins. Co. v. Knowles), 133 S. Ct. 1345 (Supreme Court 2013) (stipulation by named plaintiff not binding on absent class; aggregate claims must be considered)