Massage Envy Franchising v. Mark Pirozzi, 938 F.3d 981

Plaintiffs (Pirozzi and Green) filed a Missouri class action under the Missouri Merchandising Practices Act (MMPA), alleging Massage Envy’s ads for 60-, 90-, and 120-minute massages failed to disclose ~10 minutes used for undressing/dressing/consultation. Plaintiffs sought actual, statutory, punitive damages and attorneys’ fees.
Massage Envy removed under the Class Action Fairness Act (CAFA), asserting diversity and a >$5 million aggregate amount in controversy, based on estimates: compensatory ~$2.885M, attorneys’ fees ~$720K, and punitive damages ~$3.6M.
Plaintiffs moved to remand, arguing removal was untimely; the district court remanded on independent review, finding Massage Envy’s amount-in-controversy showing speculative and unlikely to exceed $5M (especially punitive damages).
Massage Envy petitioned for permission to appeal the remand under 28 U.S.C. § 1453(c); the Eighth Circuit reviewed de novo.
The Eighth Circuit held the district court applied the wrong legal standard by weighing merits and improbability; under controlling precedent, a plausible allegation that a class may recover compensatory, punitive, and fee awards exceeding $5M suffices unless recovery of that amount is legally impossible.
The court also held removal was timely because the initial and amended complaints did not unambiguously disclose an aggregate amount exceeding $5M; Massage Envy’s removal based on its own investigation was therefore timely.

Issue	Plaintiff's Argument	Defendant's Argument	Held
CAFA amount-in-controversy (whether federal jurisdiction exists)	Plaintiffs: Massage Envy’s amount estimates (esp. punitive, fees) are speculative and insufficient to establish >$5M.	Massage Envy: Notice plausibly alleged >$5M (compensatory + fees + punitive); punitive damages are available under Missouri law.	Held: Removal proper. A plausible notice suffices; court may not inject merits. Only legally impossible recovery defeats CAFA amount claim.
Timeliness of removal (30-day rule)	Plaintiffs: Removal was untimely because original/second amended petitions already placed >$5M in controversy.	Massage Envy: Complaints did not unambiguously disclose aggregate >$5M; removal within 30 days of learning of amount was timely.	Held: Removal timely. 30-day clock starts only when complaint or other paper unambiguously shows CAFA requirements.

Dart Cherokee Basin Operating Co. v. Owens, 135 S. Ct. 547 (a removing defendant need only plausibly allege the amount in controversy; if contested, the court decides by preponderance)
Spivey v. Vertrue, Inc., 528 F.3d 982 (if defendant plausibly alleges >jurisdictional amount, case stays in federal court unless recovery is legally impossible)
Raskas v. Johnson & Johnson, 719 F.3d 884 (affirming the legally impossible threshold for defeating a plausible amount-in-controversy allegation)
Hartis v. Chicago Title Ins. Co., 694 F.3d 935 (focus is whether a factfinder might legally conclude plaintiffs could recover the alleged amounts)
Keeling v. Esurance Ins. Co., 660 F.3d 273 (courts must accept the class’s characterization for CAFA amount-in-controversy purposes)
Gibson v. Clean Harbors Envtl. Servs., Inc., 840 F.3d 515 (30-day removal period begins when defendant receives an amended pleading, motion, order, or other paper that unambiguously shows CAFA jurisdiction)
In re Willis, 228 F.3d 896 (initial complaint starts the 30-day removal period only if it explicitly discloses damages exceeding the federal threshold)
Bell v. Hershey Co., 557 F.3d 953 (discussing CAFA’s purpose to open federal courts to certain class actions)
Grabinski v. Blue Springs Ford Sales, Inc., 203 F.3d 1024 (affirming substantial punitive-to-actual damages ratios under the MMPA)
Lewellen v. Franklin, 441 S.W.3d 136 (Mo. 2014) (punitive damages may be awarded for egregious MMPA violations)