Cohen v. Office Depot, Inc.
184 F.3d 1292
11th Cir.
1999
Check Treatment

CHERYL COHEN, on behalf of herself and others similarly situated v. OFFICE DEPOT, INC., a Florida corporation

No. 98-4787

United States Court of Appeals, Eleventh Circuit

February 24, 2000

D.C. Docket No. 97-3611-Civ-JAL

Before BIRCH and CARNES, Circuit Judges, and MILLS*, Senior District Judge.

[PUBLISH]

ON PETITION FOR REHEARING AND SUGGESTION OF REHEARING EN BANC

*Honorable Richard Mills, Senior U.S. District Judge for the Central District of Illinois, sitting by designation.

CARNES, Circuit Judge:

In our prior opinion in this case, we held that Florida Statute § 768.72 conflicts with and must yield to the “short and plain statement” rule contained in Federal Rule of Civil Procedure 8(a)(3), and as a result a Florida plaintiff in federal court because of diversity jurisdiction need not obtain leave of court before pleading a request for punitive damages. (“Cohen I“). We adhere to and leave that part of our earlier opinion intact.1

Relying on , we also held that “in a class action lawsuit punitive damages may be aggregated to satisfy the amount-in-controversy requirement for each class member,” at least “where state law provides that an award of punitive damages is for the ‘public benefit’ or ‘collective good,’ and the award would reflect ‘the wrongfulness of the defendant‘s course of conduct as a whole.‘” (quoting ). Combining our two holdings, we concluded that the complaint satisfied the amount in controversy requirement because it requested $10,000,000 in punitive damages for the entire class of approximately 39,000 Office Depot catalogue customers. .

In its petition for rehearing, Office Depot has belatedly pointed out the tension between the decision, on which we relied in our earlier opinion in this case, and the decision in . Of course, pre-split or “Old Fifth” decisions such as are binding on us, see , and where two prior panel decisions conflict we are bound to follow the oldest one. See (en banc) (“It is the firmly established rule of this circuit that each succeeding panel is bound by the holding of the first panel to address an issue of law, unless and until that holding is overruled en banc, or by the Supreme Court.“) (internal quotation marks and citation omitted); (where there is an intracircuit conflict of authority, “the earliest panel opinion resolving the issue in question binds this circuit until the court resolves the issue en banc“) (internal quotation marks and citation omitted).

For reasons we will soon discuss, we conclude that holding about aggregation of punitive damages is inconsistent with the earlier holding on the same legal issue in , and accordingly we must follow . Doing so, we conclude that the total of $10,000,000 in punitive damages that was pleaded for the class of 39,000 members in this case is insufficient to satisfy the $75,000 amount in controversy requirement. This conclusion requires us to address plaintiff, class-representative Cohen‘s remaining arguments involving alternative theories for satisfying the amount in controversy requirement, which are that it is satisfied because of the value of the requested injunctive relief, and because of the amount of attorney fees due if the class prevails. We will discuss those issues in a later part of this opinion, but we begin with a discussion of the inconsistency of (and our own prior opinion following it) with .

I. THE CONFLICT BETWEEN LINDSEY AND TAPSCOTT REGARDING AGGREGATION OF PUNITIVE DAMAGES

To avoid adding confusion to conflict, we first explain why referring to the “aggregation” of punitive damages in the context of a class action can be a bit misleading. In this case, as in and , the punitive damages claim is a single claim on behalf of the entire class; it is not the sum total of 39,000 individual punitive damages claims. Because each class member could have sought punitive damages in individual suits, courts sometimes phrase the question as whether a class claim for punitive damages can be “aggregated” to satisfy the jurisdictional amount in controversy requirement for a class. The question, however, is not whether distinct punitive damages claims can be added together, but instead it is whether the single punitive damage claim on behalf of the class can be attributed in toto to each and every class member so they can individually satisfy the requisite amount in controversy, a requirement mandated by .2 If the single punitive damages claim cannot be attributed as a whole to each class member, it must be allocated or divided pro rata among the class members, and after that is done the total amount of relief sought by each plaintiff must satisfy the jurisdictional amount. With that clarification of the question, we turn to the conflicting answers of and .3

involved a state law class action suit against two telephone companies alleged to have unlawfully extracted excessive cash deposits from the class. . The defendants removed the case to federal court on diversity grounds. . The complaint, as construed by the Court, sought: (1) $2,000 compensatory damages for Lindsey, (2) an unspecified sum of compensatory damages for the class, which contained an unspecified number of plaintiffs, and (3) $1,000,000 punitive damages on behalf of the class. .

The Court began its analysis by citing , for the broad proposition that multiple plaintiffs suing in a class may not aggregate any claims for the purpose of satisfying the amount in controversy requirement of diversity jurisdiction. . The Court then noted that each member of a class must individually satisfy the jurisdictional amount to avoid being dismissed from the class suit. (citing ). Because the plaintiff had failed to plead a specific number of class members, the Court explained that it could not determine “what dollar amount represent[ed] the ‘amount in controversy’ for each member of the class.” (emphasis added). Noting that the grounds for removal jurisdiction must be found in the plaintiff‘s complaint itself, the Court explained that “it was not open for [the] defendants to attempt to show that the class was small enough that the claims on its behalf exceeded the sum of $10,000 per capita,” , which was the amount in controversy requirement at that time, .

Because it could not tell from the complaint the number of class members, the Court could not determine whether each member‘s claim satisfied the jurisdictional amount, and it therefore held that the total specified damage claim for the class - $1,002,000 - had not been shown to satisfy the amount in controversy requirement. . A necessary part of reasoning is the holding that for amount in controversy purposes a class punitive damages claim must be allocated pro rata to each class member. Otherwise, the result in that case would have been different. If the Court had concluded that a class claim for punitive damages could be attributed in toto to each class member, i.e., considered in the aggregate, for amount in controversy purposes, the $1,000,000 punitive damages claim clearly would have sufficed, regardless of whether the number of class members in had been two or two million. The number of class members would have been irrelevant, instead of the critical factor in the decision. Thus, inescapably stands for the proposition that a federal court cannot exercise diversity jurisdiction over a class action - even with completely diverse parties - solely because the total punitive damages claim on behalf of the entire class exceeds the jurisdictional amount in controversy. Instead, under , the punitive damages claim for the class must be assigned on a pro rata basis to each class member for amount in controversy purposes.

Three years after , we split from the Fifth Circuit but retained its decisional law as our own, , and fifteen years after the split, this Court decided In that case, we faced another attempt to base diversity jurisdiction on a class claim for punitive damages, but we mistakenly considered the matter as one of first impression.4 . The plaintiffs in brought a state law class action, alleging a class of over 10,000 members. . The class sought statutory damages, injunctive relief, and an unspecified amount of compensatory and punitive damages, based on the defendant‘s allegedly fraudulent conduct in the sale of extended service contracts. . The defendants removed the case to federal court on diversity jurisdiction grounds. The plaintiffs contested the removal with affidavits attesting that the individual recovery for each plaintiff would not exceed $50,000, the amount in controversy required for diversity jurisdiction at the time. The defendants responded that, for jurisdictional purposes, the class claim for punitive damages should be considered in the aggregate. . We agreed and upheld the removal of the case to federal court. .

In , this Court pointed to the Supreme Court‘s discussion in , which indicated that multiple plaintiffs may aggregate claims if they have “a single title or right in which they have a common and undivided interest.” (quoting ). We then considered the nature of punitive damages under Alabama law, finding that Alabama awards punitive damages to plaintiffs not “as a matter of right,” but rather as a means to punish and deter wrongful conduct. . Because punitive damages were intended to serve the collective good, we reasoned that the class had a “common and undivided interest” in the punitive damages claim. . That is why this Court in permitted the punitive damages claim to be used to satisfy the requisite amount in controversy for the entire class; in effect, we let the whole amount of the punitive damages claim be used by each class member for that purpose, a result inconsistent with the decision in almost twenty years earlier. .

Attempting to distinguish from , Cohen points to the analysis in addressing whether the punitive damages claim constituted a “single collective right in which [the class members had] a common and undivided interest.” She contends that the “common and undivided interest” issue was never presented to us in , and thus, there is no real conflict between our and decisions. Cohen‘s contention misconstrues the operation of our prior panel precedent rule. The issue in was the same as that in : whether a class claim for punitive damages can be considered in the aggregate in order to establish diversity jurisdiction over all potential members of a class, or must instead be attributed pro rata to each class member.

“Common and undivided interest” is simply the standard used to decide which, if any, claims by multiple plaintiffs may be considered in the aggregate for jurisdictional purposes, and which must be divided among the class members. . But we had already decided in that a class claim for punitive damages could not be considered in the aggregate for each class member, or at least that such a claim arising under Alabama law could not be. Our conclusion to the contrary in , which also involved Alabama punitive damages law, is inconsistent with the result in . Because the same state law governed punitive damages in each case, there can be no difference between the two cases insofar as the “common and undivided interest” analysis is concerned.5

The fact that this case involves a Florida law punitive damages claim does not distinguish it from , because as we concluded in our prior panel opinion in this case, the nature of punitive damages is the same under Florida law as under Alabama law. . We explained that both states award punitive damages to serve the collective good, noting particularly that “Florida law, like Alabama law, provides that ‘punitive damages are warranted only where the egregious wrongdoing of the defendant ... constitutes a public wrong.‘” (citation omitted). Consequently, there can be no difference between this case and stemming from a “common and undivided interest” analysis of state punitive damages law.6

Cohen‘s real argument is that the result and holding of are wrong because we failed to apply a “common and undivided interest” analysis - she says it was not even considered. Even if we thought wrong, the prior panel precedent rule is not dependent upon a subsequent panel‘s appraisal of the initial decision‘s correctness. Nor is the operation of the rule dependent upon the skill of the attorneys or wisdom of the judges involved with the prior decision - upon what was argued or considered. Unless and until the holding of a prior decision is overruled by the Supreme Court or by the en banc court, that holding is the law of this Circuit regardless of what might have happened had other arguments been made to the panel that decided the issue first.

held that, for purposes of deciding whether the amount in controversy requirement had been satisfied, the amount of an Alabama punitive damages claim was to be divided by the number of class members and the result attributed to each member of the class. decided to the contrary. Because predates , we must follow as the precedent of this Court. ; .

Accordingly, we rescind that part of our prior opinion in this case that relied upon to hold that the $10,000,000 punitive damages claim on behalf of Cohen‘s proposed class satisfied the amount in controversy requirement for diversity jurisdiction over this case. . The punitive damages claim does not satisfy the amount in controversy requirement, because when the $10,000,000 class claim for punitive damages is divided among the alleged 39,000 class members, as requires for amount in controversy purposes, each member‘s share of the claim is approximately $256.

We now address Cohen‘s other two grounds for satisfying the requisite amount-in-controversy: (1) the value of the requested injunctive relief, and (2) the amount of attorney fees due if the class prevails.

II. COHEN‘S OTHER GROUNDS FOR DIVERSITY JURISDICTION

A. INJUNCTIVE RELIEF

In addition to requesting compensatory and punitive damages, this lawsuit seeks to enjoin Office Depot from engaging in unfair and misleading advertising regarding the catalogue prices of its products. Cohen claims that Office Depot‘s advertising indicates that the prices for products purchased from its catalogues are the lowest prices available anywhere, but that the truth is some products are less expensive if purchased at Office Depot stores. She argues that enjoining such allegedly misleading advertising would “result[] in changes to Office Depot‘s advertising and business practices, thereby benefitting the Plaintiff class, as a whole, by an amount that is clearly in excess of the jurisdictional requirement of Section 1332.” Appellant‘s Br. 44-45.

When a plaintiff seeks injunctive or declaratory relief, the amount in controversy is the monetary value of the object of the litigation from the plaintiff‘s perspective. . In other words, the value of the requested injunctive relief is the monetary value of the benefit that would flow to the plaintiff if the injunction were granted. In this case, Cohen maintains that the class has a “common and undivided interest” in the injunctive relief, and thus, if considered in the aggregate, the monetary value of it to the class - alone or combined with the other claims for relief - would satisfy the $75,000 amount in controversy requirement. However, we need not address whether the monetary value of the requested injunctive relief should be considered in the aggregate, or instead attributed pro rata among the class members, because we conclude that the monetary value of the injunctive relief to the class plaintiffs in this case is “too speculative and immeasurable” to establish the requisite amount in controversy in either event. .

We have little trouble concluding “to a legal certainty” that the value of the injunctive relief does not satisfy the jurisdictional amount in this case, , because we doubt that any monetary value at all would accrue to the class plaintiffs upon issuance of the prospective injunction. If the requested injunctive relief were granted, Office Depot would not be required to offer its products at the lowest price available, but instead could simply raise the price of the products in its stores a sufficient amount that its advertising of catalogue prices was no longer false. That result would comply with the injunction the class seeks, but it would be of no monetary benefit to them. Indeed, to the extent class members also buy products in Office Depot stores, the injunction would cost them money under that scenario.

But let us assume Office Depot‘s reaction to the requested injunction would be to leave product prices as they are and clarify its advertising to remove any statement that catalogue prices are the same as store prices. That result is the most the class could hope for from the requested injunction, but it is one which would be of little or no monetary value to class members. The benefit of the injunction to the class plaintiffs would be the knowledge that some office products were less expensive when purchased at Office Depot stores than when purchased through the catalogue. However, upon class certification and notice, the class plaintiffs would already have known that, because the allegedly misleading advertising is the very basis of the class action.

Although Cohen‘s complaint seeks class certification under subdivisions (b)(1)(A), (b)(1)(B), and (b)(3) of Fed. R. Civ. P. 23, Cohen‘s class, if certified, would likely be certified as a (b)(3) class. Certification under Rule 23(b)(3) would require that the class members receive notice of the suit “well before the merits of [it] are adjudicated.” (citations omitted); Fed. R. Civ. P. 23(c)(2); see also 7B Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1788 (2nd ed. 1986). As a result, before any injunction were granted, the class would already know that the catalogue price of some Office Depot products is higher than the store price. Or, stated differently, if the injunction were not granted, the class plaintiffs would still know that the advertising is sometimes false and that they can avoid paying the higher catalogue prices simply by shopping elsewhere or by purchasing the products at Office Depot‘s stores. The injunctive relief itself would not be of any monetary value to the class members. (explaining that the class members’ “financial recovery will come ... from their tort and [restitution] claims, not from the prospective injunctive relief“).

The remote possibility - if there be any - that monetary value might somehow flow to the class plaintiffs from the requested injunctive relief is “too speculative and immeasurable to satisfy the amount in controversy requirement.” . In , the plaintiff company, Ericsson, claimed that the City of Birmingham improperly handled the bidding process for its purchase of a communications system, resulting in the company losing the communications system contract to Motorola. . Ericsson sought to enjoin the city‘s contract with Motorola and also to have the court declare Ericsson the lowest responsible bidder, entitling it to the contract with the city worth almost $10,000,000. However, the district court noted that, under Alabama law, the only remedy available to Ericsson was to have the district court enjoin the performance of the city‘s contract with Motorola as void. . Not only did the court lack authority to declare Ericsson the lowest bidder, it could not even require the city to rebid the contract.

Consequently, the only benefit to Ericsson from its injunctive relief would have been the possibility that the city might rebid the contract and that, during the rebid, the city might select Ericsson‘s communications system and price. . We refused to pile possibility onto possibility to estimate the value of that benefit, but instead held that “[b]ecause [Ericsson could not] reduce the speculative benefit resulting from a rebid ‘to a monetary standard, [] there [was] no pecuniary amount in controversy.‘” (quoting ).

Similarly, the injunctive relief in this case involves too many contingencies, such as the manner in which Office Depot might alter its pricing schemes and the extent to which the class members’ purchasing patterns might change. Because of these contingencies, any benefit to the class from the injunction cannot be reduced to a reasonable monetary estimate.8 . We therefore conclude that any monetary value to Cohen‘s class from the injunction is either non-existent, or at least too tenuous of a foundation for diversity jurisdiction. In reaching this conclusion, we also note that the policy underlying 28 U.S.C. § 1332(a), which is to reserve federal court diversity jurisdiction for disputes involving relatively substantial damages, further informs our refusal to speculate about the value of a prospective injunction to the class plaintiffs in this case. (noting that § 1332(a) “must be narrowly construed so as not to frustrate the congressional purpose behind it“). The total compensatory and punitive damages claim for each class member in this case is about $260,9 well below the $75,000 threshold for diversity jurisdiction.

Because the class claim for injunctive relief is too speculative to satisfy the amount in controversy requirement, we turn now to the question of whether the potential recovery of attorney fees, alone or in combination with the damages claims, can establish the jurisdictional amount in controversy.

B. ATTORNEY FEES

On behalf of the class, Cohen brought claims under Florida statutes that prohibit deceptive business practices, see Fla. Stat. § 501.201 et seq., and misleading advertising, see Fla. Stat. § 817.41. Both statutory causes of action authorize a court to award attorney fees to the prevailing party. See Fla. Stat. § 501.2105; Fla. Stat. § 817.41. Cohen contends that when a statutory cause of action entitles a party to recover reasonable attorney fees, the amount in controversy includes consideration of the amount of those fees. She is correct. ; .

Cohen also contends that the attorney fees in this case will clearly surpass the $75,000 threshold for the amount in controversy; and she argues that the amount of fees she anticipates will be awarded either should be (1) attributed to her as the prevailing party, with jurisdiction over the other class plaintiffs established under 28 U.S.C. § 1367(a) (the supplemental jurisdiction provision), or (2) considered in the aggregate and attributed in toto to each member based on their “common and undivided interest” in the attorney fees. Assuming away our doubts that Cohen has established a sufficient basis for her contention that an award of attorney fees in this case will reach $75,000 or more,10 we address in turn her arguments as to how that amount of fees should be attributed.

First, we find no basis for attributing the potential award of attorney fees to Cohen, either individually or as the class representative. The claim for attorney fees in this case is based on two Florida statutes: Fla. Stat. § 501.2105(1), authorizing an award of attorney fees to “the prevailing party” in an action based on deceptive business practices; and Fla. Stat. § 817.41(6), mandating an award of attorney fees to “[a]ny person prevailing” in an action based on misleading advertising. If this class action were successful on the merits, the entire class of plaintiffs - not just Cohen - would “prevail” in the action, and accordingly, it is the class and not just Cohen who would recover attorney fees under the statutes.11

In addition, as an individual class member, Cohen stands to recover no more than $260 in damages. In her first proposed amended complaint, Cohen indicated that over $100,000 in reasonable attorney fees would be incurred in the litigation. Attributing to one plaintiff an anticipated attorney fees award that is over 384 times greater than that plaintiff‘s stake in the litigation could raise serious questions about the reasonableness of the fee award. For these reasons, we conclude the claim for attorney fees in this case is not attributable solely to Cohen, but instead to the entire class. Because of that conclusion, we must now decide how the claimed attorney fees should be attributed to each class member for amount in controversy purposes.12

Cohen maintains that the class members share a “common and undivided interest” in the anticipated award of attorney fees, and thus, the claim for those fees should be viewed in the aggregate, with the total amount attributed to each class member. Office Depot responds that, like the class claim for punitive damages, the amount of the claimed attorney fees should be divided pro rata among each individual class member. In light of a recent decision by this Circuit and the relevant Florida case law, we conclude that the claim for attorney fees is not “a single title or right in which [the class members] have a common and undivided interest” in the claimed attorney fees. . Therefore, for amount in controversy purposes, the estimated total attorney fees award should be divided among all of the class members.

In , the defendant attempted to remove a class action to federal court on diversity grounds, arguing that the class plaintiffs’ claim for attorney fees under the Georgia RICO statute should be considered in the aggregate for amount in controversy purposes. We rejected that argument. Following the principles laid down by the Supreme Court in , we concluded that the claimed attorney fees did not constitute a “single title or right” in which the class members had a “common and undivided interest.” . In reaching that conclusion, we noted that each class plaintiff could have recovered his attorney fees in individual suits under the RICO statute. . It followed that the class members did not share a “single title or right” in the claimed attorney fees, but instead, each member had a “separate and distinct statutory right or claim to recover those attorney[] fees.” Id. Noting further that under Georgia law the statutory award of attorney fees serves to compensate injured plaintiffs, we reasoned that considering the fees in the aggregate would contravene prohibition against aggregating compensatory damages.13 Therefore, we refused to aggregate the claimed attorney fees of the class.14

We construe to hold that a statutory claim for attorney fees may not be considered in the aggregate for amount in controversy purposes, at least not when both of these factors are present: (1) the class members have a “separate and distinct” right to recover attorney fees under the relevant statute; and (2) state law provides that the statutory attorney fees serve to compensate the class members for their injuries.15 Applying that holding to the facts of this case, we conclude that the claimed attorney fees may not be considered in the aggregate to establish the requisite amount in controversy.

As for the first factor, the class members in this case could recover their individual attorney fees incurred in separate, individual suits under Florida‘s consumer protection statutes. See Fla. Stat. § 501.2105(1) (authorizing fee award for “prevailing party“); Fla. Stat. § 817.41(6) (mandating fee award for “[a]ny person prevailing” under the statute). Like the Georgia RICO statute involved in , the Florida statutes in this case provide “each individual plaintiff in a putative class the right to recover attorney[] fees in the case.” . The members of Cohen‘s class are not joining to “enforce a single title or right” in the statutory award of attorney fees, , because each member has a “separate and distinct right” in the claimed fees. .

The second factor is also present. Like the attorney fees award under the Georgia RICO statute in , an attorney fees award under Florida consumer protection statutes serves an important compensatory purpose. In , the District Court of Appeals for the Fourth District noted that “the obvious purpose of the ‘Little FTC Act’ [which includes § 501.2105(1)] is to make consumers whole for losses caused by fraudulent consumer practices [and that] ... [t]hese aims are not served if the attorney[] fees are not included in the protection.” (citation omitted); (explaining that an award of attorney fees, unlike an award of punitive damages, “does not provide remuneration to the claimant over and above the amount necessary to compensate him for his loss“). Even though the primary purpose of such an award is to encourage private enforcement of statutory policies, thus benefitting the public, , that does not mean attorney fees are not also compensatory in nature. The Florida Supreme Court has recognized that private individuals cannot be expected to pursue statutory causes of action unless their own losses and costs, including their attorney fees, will be fully compensated. (noting that “[i]f ... consumers cannot recover in full their attorney fees, they will quickly determine it is too costly ... to file suit, and individual enforcement of this act will fail“) (quoting ). Because the statutory attorney fees involved in this case serve a significant compensatory purpose, in this case as in , aggregating the claimed attorneys fees would be inconsistent with . Consequently, the nature and purpose of the statutory right to attorney fees in this case strongly resemble those of the statutory right to attorneys fees in ; it follows that the result should be the same.

Because the attorney fees authorized by the Florida statutes in this case serve to compensate plaintiffs for losses resulting from allegedly unlawful business practices, and because claims for those fees could be asserted by the class plaintiffs in individual suits, we conclude that the claimed fees do not constitute “a single title or right in which [the class members] have a common and undivided interest.” . It follows that the amount of claimed attorney fees may not be considered in the aggregate - may not be attributed in whole to each class member - but instead, like the class claim for punitive damages, it must be divided out among the total number of class members for amount in controversy purposes. Because each class member‘s damages claim approximates $260, and the claimed attorney fees must be divided pro rata among 39,000 class members, an astronomical amount of attorney fees would have to be recovered in order to satisfy the amount in controversy requirement.16 Such a recovery is not possible, and therefore, neither is diversity jurisdiction.

III. CONCLUSION

Because we conclude that Cohen has failed to allege a sufficient amount in controversy to establish jurisdiction under 28 U.S.C. § 1332(a), we vacate our prior opinion reversing the district court‘s dismissal of this case and remanding for further proceedings. We now affirm the district court‘s order dismissing the case for lack of subject matter jurisdiction.

AFFIRMED.

Notes

1
For a full recitation of the relevant facts of this case, see .
2
Cohen argues that holding requiring dismissal from a class suit of any plaintiff whose individual claim does not satisfy the amount in controversy requirement has been superseded by the 1990 amendments to 28 U.S.C. § 1367. As will be discussed, we need not decide that issue to resolve the present case. See infra note 13.
3
Although the term “aggregation” is slightly misleading in the context of punitive damages and attorneys fees, it is commonly used by courts when addressing the issue of whether the total amount of a class claim should be attributed to each member of the class. Therefore, to avoid further confusion and for the sake of consistency, we will continue to refer to the issue as one of “aggregation.”
4
The opinion cites for the proposition that each member of a class must individually satisfy the amount in controversy requirement in order to avoid being dismissed from the suit. . But the opinion does not mention the part of that requires a pro rata distribution of the claimed punitive damages for purposes of determining the amount in controversy.
5
Compare (allowing aggregated class claim for punitive damages because, under Mississippi law, plaintiffs had a “common and undivided interest” in punitive damages claim), with (disallowing aggregated class claim for punitive damages in Louisiana case and stating that “[i]t is unclear to us what Mississippi law regarding punitive damages drove the panel to depart from rule, but we find no principle in Louisiana law ... that permits us to depart from “).
6
As we noted in our prior opinion in this case, our decision in to consider the class punitive damages claim in the aggregate was also based on the fact that “the award of punitive damages [would] reflect not the wrong done to any single individual but the wrongfulness of the conduct as a whole.” (citing ). The class in that case consisted of over 10,000 members, and the allegedly fraudulent transaction underlying each member‘s claim involved relatively small amounts of money. . Reasoning that “where the wrong to the individual is small but the course of conduct is large, the potential punitive damages would be to punish and deter the course of conduct as a whole,” we concluded in that it was appropriate to view the class claim for punitive damages in the aggregate. . We also suggested that if the facts indicated the punitive damages award “would be determined on an individualized consideration of the egregiousness of the harm done to individual class members,” , instead of the “wrongfulness of the defendant‘s course of conduct as a whole,” , then aggregation might not be proper. . In view of this analysis in , the decision arguably could be viewed as holding only this: when a plaintiff fails to specify the size of the class, thereby preventing the court from determining the extent of the defendant‘s wrongful course of conduct, the class claim for punitive damages cannot be viewed in the “aggregate,” i.e., it cannot be attributed in toto to each class member. Unfortunately, our analysis in forecloses that potential distinction between that case and . In , we stated that if the plaintiff had alleged a specific number of class members, that allegation “would have permitted the court to ascertain what dollar amount represents the ‘amount in controversy’ for each member of the class.” (emphasis added). Significantly, our analysis in suggests that the aggregation of punitive damages is proper when the defendant‘s course of conduct affects a large number of individuals. . But according to our prior analysis in , a “large” class is exactly what would have prevented the amount in controversy requirement from being satisfied. Our concern in was that the number of class members, or the divisor, might be so large that the $1,000,000 punitive damages claim, when divided by the number of class members, would result in an amount less than $10,000 (the requisite amount in controversy at the time). We indicated in that the class would satisfy the amount in controversy requirement if the complaint alleged a total number of members that “was small enough that the claims on its behalf exceeded the sum of $10,000 per capita.” (emphasis added). Thus, while our opinion in does not explicitly forbid the aggregation of a class claim for punitive damages, the reasoning and result in that opinion does. Under our reasoning in , a punitive damages claim must be divided by the total number of class members with the quotient attributable to each class member for amount in controversy purposes. Our inability to determine the number of class members, or the divisor, was critical not because we could not determine the nature of the defendants’ course of conduct, but because without a divisor we could not do the division necessary. We could not divide the class punitive damages claim by the number of class members without knowing that number. A Fifth Circuit panel recently acknowledged the necessary implication of our decision. (construing to “appl[y] reasoning that compensatory damage claims cannot be aggregated for jurisdictional purposes to the context of punitive damage claims“); see supra at note 6.
7
Because Cohen‘s class seeks compensatory damages, it cannot be certified as a (b)(1)(A) class. . As for potential certification under (b)(1)(B), we fail to see from the complaint‘s allegations how individual suits against Office Depot brought by one or more class members “would as a practical matter be dispositive of the interests of the other members ... or substantially impair or impede their ability to protect their interests.” Fed. R. Civ. P. 23(b)(1)(B); see also 7A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1774 (2nd ed. 1986) (explaining that “(b)(1)(B) allows class actions to be brought in cases in which separate suits might have undesirable effects on the class members“). Moreover, the possibility that an individual suit “will have either precedential or stare decisis effect on later [suits] is not sufficient” for (b)(1)(B) class certification. .
8
Like the plaintiff in , Cohen has not established a monetary value for the injunctive relief claim. . Cohen argues that her proposed amended complaints provide bases for valuing the injunctive relief claim, primarily the substantial expense Office Depot would incur by “retooling” its pricing scheme and advertising. The potential cost of compliance to the defendant, however, is irrelevant in determining the value of the benefit that would be obtained by the plaintiff from an injunction. . For that reason, the proposed amended complaint did not establish the requisite amount in controversy based on the value of the injunctive relief, and accordingly, the district court did not abuse its discretion in denying leave to amend. (noting that when “a complaint as amended is still subject to dismissal, leave to amend need not be given“) (citation omitted).
9
While there are persuasive reasons for viewing the amount in controversy as the total liability faced by a defendant, instead of as the amount each plaintiff stands to gain, “the Supreme Court has long since closed that door.” . In this case, the approximate compensatory damages claim of each member, assuming Cohen‘s claim is representative of the other class members, is $3.57. Each member‘s share of the punitive damages claim is approximately $256. The total damages claim of each class member, therefore, is less than $260.
10
We doubt that Cohen has sufficiently established that $75,000 in attorneys fees will be recovered in this case. In her proposed amended complaint, Cohen contends that over $60,000 in reasonable attorneys fees had been incurred up to that point in the litigation and that ultimately over $100,000 in fees would be incurred. However, Cohen provided no documentation supporting those contentions or specific explanation for the substantial amount claimed. Arguably, when the amount in controversy substantially depends on a claim for attorneys fees, that claim should receive heightened scrutiny. (explaining that when a “[punitive damages] claim comprises the bulk of the amount in controversy and may have been colorably asserted solely or primarily [for jurisdictional purposes], that claim should be given particularly close scrutiny“). However, because of the permissive nature of “legal certainty” standard for the sufficiency of a plaintiff‘s amount in controversy allegation, and because our decision would not be different even if the claimed amount of fees were accurate, we will assume that Cohen has alleged a sufficient basis for a potential attorneys fee award exceeding $100,000, as estimated in her proposed amended complaint.
11
Cohen‘s citation to , is inapposite. The Court in that case attributed a claim for attorney fees to the class representatives, because the relevant Louisiana statute provided that a “court may allow the representative parties their reasonable expenses of litigation, including attorney[] fees, when as a result of the class action a fund is made available, or a recovery or compromise is had which is beneficial, to the class.” (emphasis added). Unlike the statute in , the Florida statutes at issue here do not contain language indicating that the award of attorneys fees should go to the class representatives.
12
Cohen asks us to join the Fifth and Seventh Circuits in concluding that Congress statutorily overruled holding that each plaintiff must assert a claim satisfying the requisite amount in controversy to avoid being dismissed from a class action based on diversity jurisdiction. See ; . She contends that the 1990 amendments to 28 U.S.C. § 1367 authorize a court to exercise supplemental jurisdiction over the claims of the entire class, once the claim of one class member is found to satisfy the amount the controversy requirement. However, we need not address that argument. Because the claimed attorney fees in this case are not attributable solely to Cohen, no member of the class has an individual claim that satisfies the requisite amount in controversy. Therefore, diversity jurisdiction will exist in this case only if the claimed attorney fees may be considered in the aggregate, attributed as a whole to each class member.
13
distinguished the “collective good” purposes of the punitive damages in from the compensatory nature of the attorneys fees in that case. . Therefore, the decision in did not depend on the continued validity of the decision. However, if had somehow reiterated the part of that conflicts with , we would still be compelled to follow , to the extent of any conflict. The prior panel precedent rule precludes us from “hold[ing] that two subsequent panel opinions can implicitly overrule a prior panel opinion.” .
14
This Court also rejected the aggregation of an attorney fees award in . However, the precedential effect of on this case is minimal, because that case did not involve a statutory right to attorneys fees. Instead, addressed only the “narrow question ... [of] whether a fee to be deducted from a [class action] common fund may, if it exceeds $75,000, satisfy the amount-in-controversy requirement.” .
15
Because both factors are present in this case, we need not decide whether either one standing alone would prevent aggregation of attorney fees to satisfy the amount in controversy.
16
Each class member must, in effect, “recover” $74,740 in attorneys fees ($75,000 required for diversity jurisdiction minus the $260 in damages per class member). That means the class would have to recover a total of $2.9 billion in attorneys fees ($74,740 multiplied by the alleged 39,000 class members).