Dеfendant-appellant Mortgage Electronic Registration Systems, Inc. (“MERS”) appeals from an order of the United States District Court for the Eastern District of New York (Eric N. Vitaliano, Judge) granting the motion of the putative class member plaintiffs-appellees (“plaintiffs”), to remand this case to New York state court on the ground that MERS’s notice of removal was untimely. The district court concluded that the plaintiffs’ complaint contained sufficient information to put MERS on notice of the size of the putative class and amount in controversy to establish subject matter jurisdiction pursuant to 28 U.S.C. § 1332(d), and it held that
We reverse and hold that, in Class Action Fairness Act (“CAFA”) cases, the 30-day removal periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3) are not triggered until the plaintiff serves the defendant with an initial pleading or other paper that explicitly specifies the amount of monetary damages sought or sets forth facts from which an amount in controversy in excess of $5,000,000 can be ascertained. We also hold that where a plaintiffs papers fail to trigger the removal clocks of 28 U.S.C. §§ 1446(b)(1) and (b)(3), a defendant may remove a case when, upon its own indepеndent investigation, it determines that the case is removable; thus, the 30-day removal periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3) are not the exclusive authorizations for removal in CAFA cases.
Here, neither the plaintiffs’ initial complaint nor their response to MERS’s demand for a bill of particulars in the state court explicitly specified the amount of damages sought or provided MERS with sufficient information to conclude the threshold amount in controversy was satisfied. The named plaintiffs’ identification of their damages ($6,835.20) and their allegation that the potential class “includes hundreds, and likely thousands, of persons and entities,” were not adequаte to trigger the 30-day removal periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3). We also hold that MERS properly filed its notice of removal after determining upon its own investigation that the amount in controversy, number of plaintiffs, and diversity between itself and at least one plaintiff class member satisfied the CAFA subject matter jurisdictional requirements set forth in 28 U.S.C. § 1332(d). We accordingly VACATE the order of the district court and REMAND.
BACKGROUND
The Parties and the Class Complaint
Plaintiffs Brian Cutrone and Jessica Cervone filed the present putative class action against MERS in the Supreme Court of the State of New York, Kings County on February 20, 2013. Their complaint asserts causes of action against MERS under New York state law for common law breach of implied warranty, deceptive business practices in violation of New York General Business Law Section (“NYGBL”) § 349, and false advertising in violation of NYGBL § 350, allegedly committed in connection with MERS’s facilitation of the provision of “Esign”
According to the plaintiffs’ complaint, MERS is a Delaware 15 corporation with its principal place of business in Virginia. MERS created an Internet-based electronic process through which borrowers can obtain paperless Esign mortgages and engage in refinancing of mortgages, and members of the real estate mortgage industry can more easily securitizе and bundle mortgages. To facilitate these transactions, MERS acts as the mortgagee of record in local recording offices regardless of the number of times a mortgage is refinanced or the relevant lenders change.
When a party executes an Esign mortgage, no physical mortgage document, such as a mortgage note, is created. Instead, the mortgage documents exist as electronic records registered on MERS’s “eRegistry.” When a party later wishes to refinance an Esign mortgage or otherwise
New York state courts have held that a lender does not have standing to commence a foreclosure action when its assign- or, MERS, neither received the right to transfer the mortgage note nor physically possessed the underlying mortgage note. See, e.g., Bank of N.Y. v. Silverberg,
Cutrone and Cervone obtained their first mortgage on their home in Brooklyn through an Esign mortgage that listed MERS as the nominee and mortgagee on March 27, 2008, and paid $7,476.00 in taxes as required by New York’s mortgage recording tax.
In their putative class action complaint, which alleges that other borrowers were also required to pay additional recording taxes because of their Esign mortgages, the plaintiffs do not specifically enumerate either the expected number of class members that will join them or the total amount of additional mortgage recording taxes paid by class members. The plaintiffs merely provide the amount of thе mortgage recording tax they paid on their refinanced mortgage ($6,835.20) and estimate that the class includes “hundreds, and likely thousands, of persons and entities.” The plaintiffs also failed to specify in their response to the defendant’s demand for a bill of particulars in the state court the number of members in the putative class, estimating again that there were more than 100 likely plaintiffs and, as to the damages sought by the class, that they “cannot reasonably state the precise amount in controversy.”
Federal District Court Proceedings
On May 24, 2013, more than 90 days after the plaintiffs filed their initial complaint in New York state court, MERS filed a notice of remоval in the United States District Court for the Eastern District of New York asserting diversity jurisdiction under CAFA, 28 U.S.C. § 1332(d). The notice alleges that MERS examined its own records and concluded that its eRegistry contained more than 3,000 registered promissory notes in electronic form secured by mortgages on real property located in New York. The notice also estimates that, given the large number of relevant promissory notes in MERS’s eRe-gistry, “even using a conservative estimate of damages for each possible class mem
On June 24, 2013, the plaintiffs filed a motion to remand, asserting that MERS’s removal was untimely under 28 U.S.C. § 1446(b)(1) because the plaintiffs’ complaint provided MERS with sufficient information to determine the likely number of plaintiffs and total amount in controversy. By order dated October 28, 2013, the district court granted the plaintiffs’ motion, concluding that, although the complaint filed on February 20, 2013, did not specify either the totаl amount of damages sought or an exact number of class members, it provided MERS with “all it needed to know in order to enable it to make an intelligent assessment as to CAFA remov-ability.” Cutrone v. Mortg. Elec. Registration Sys., Inc., No. 13-CV-3075 (ENV)(VMS),
The district court rejected MERS’s argument that our holding in Moltner v. Starbucks Coffee Co.,
Appellate Proceedings
On November 15, 2013, MERS petitioned this Court for permission to appeal the district court’s remand order pursuant to 28 U.S.C. § 1453(c)(1) and Federal Rule of Appellate Procedure 5(a). It argued that its notice of removal was timely because plaintiffs’ initial complaint failed to trigger the 30-day removal clock of 28 U.S.C. § 1446(b)(1) and urged this Court to extend the rule of Moltner to CAFA cases. We granted MERS’s petition for permission to appeal on February 19, 2014. We instructed the parties to brief the following two questions: (1) whether this Court’s decision in Moltner applies to cases removed under CAFA and (2) whether a defendant may remove a case under CAFA if neither of the two 30-day periods set forth in 28 U.S.C. §§ 1446(b)(1) and (b)(3) is triggered because the initial pleading and other documents are indeterminate with respect to removability but
DISCUSSION
I. Appellate Jurisdiction and Standard of Review
We have jurisdiction to hear this appeal pursuant to 28 U.S.C. § 1453(c)(1), which provides that “a court of appeals may accept an appeal from an order of a district court granting or denying a motion to remand a class action to the State court from which it was removed if application is made to the court of appeals not more than 10 days after entry of the order.” See also DiTolla v. Doral Dental IPA of N.Y.,
We review de novo a district court’s subject matter jurisdiction determination. See id. at 275.
II. Applicability of Moltner to CAFA Cases
We begin with a brief explication of the relevant statutory framework for the removal of CAFA cases. In 2005, Congress enacted the Class Action Fairness Act, Pub.L. No. 109-2, 119 Stat. 4 (2005) (codified, in part, at 28 U.S.C. § 1332(d)), which conferred federal jurisdiction over any class action involving: “(1) 100 or more class members, (2) an aggregate amount in controversy of at least $5,000,000, exclusive of interest and costs, and (3) minimal diversity, i.e., where at least one plaintiff and one defendant are citizens of different states.” Blockbuster, Inc. v. Galeno,
A defendant’s ability to remove any case satisfying federal jurisdictional predicates, including a CAFA case, is subject to statutorily-imposed time limits. The general removal statute delineates two 30-day periods during which removal may occur. See generally 28 U.S.C. § 1446(b). The first statutory provision requires that a defendant file its notice of removal within 30 days of the service or receipt of the initial pleading.
Neither provision specifies the information that must be included in a plaintiffs initial pleading or other paper to trigger the 30-day periods of 28 U.S.C. § 1446(b) or how a defendant should “ascertain” removability. See Moltner,
We addressed this issue in Moltner v. Starbucks Coffee Co.,
Under the Moltner standard, defendants must still “apply a reasonable amount of intelligence in ascertaining re-movability.” See Whitaker v. Am. Telecasting, Inc.,
In drawing a bright line rule requiring service of a dоcument explicitly stating the amount in controversy to trigger either 30-day period in 28 U.S.C. § 1446(b) in Moltner, we joined the Eighth Circuit. See
Since we decided Moltner, at least three of our sister circuits have also adopted a rule requiring that the initial pleading or
In Walker v. Trailer Transit Inc., the Seventh Circuit held that “[t]he 30-day removal clock does not begin to run until the defendant receives a pleading or other paper that affirmatively and unambiguously reveals that the predicates for removal are present.”
In Kuxhausen v. BMW Financial Services NA LLC, the Ninth Circuit reached a similar decision in a CAFA case in which the named plaintiff claimed damages “exceeding $50,000” for herself and asserted that the class had “hundreds” of members but failed to specify the particular amount of damages the other class members would each claim.
The plaintiffs in this case do not object to the application of Moltner to CAFA cases, but they argue that Moltner should only be applied where “plaintiffs are in possession of information to explicitly specify damages.” They advocate an individual analysis of the timeliness of removal based upon the availability of information to the parties. They also argue that requiring the service of a paper explicitly stating the amount in controversy to trigger the removal clocks encourages gamesmanship and delay by defendants. They point out that, in this case, MERS failed to perform an examination of its records until more than two months after plaintiffs filed their complaint.
We rejected this argument in Moltner,
Applying a bright line rule here, neither the plaintiffs’ complaint nor their subsequent response to MERS’s bill of particulars explicitly specifies the aggregate amount in controversy or alleges sufficient information for the defendant to ascertain removability. The only amount provided in the complaint is that which the two named plaintiffs are seeking to recover: the $6,835.20 they paid in New York state mortgage recording taxes upon refinancing their mortgage. Plaintiffs argue that MERS could have easily ascertained the aggregate amount in controversy for the class from the face of their complaint by multiplying $6,835.20 by the estimated number of putative class members, identified in the complaint as “hundreds, and likely thousands.” However, “[njowhere in th[e] pleading[s] do[] [the plaintiffs] allege the value, even as an approximation, of other class members’ [second mortgage recording tax payments].” Kuxhausen,
III. Exclusivity of the 30-Day Removal Periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3) in CAFA Cases
MERS’s removal in this case is thus not precluded by the 30-day clocks of 28 U.S.C. §§ 1446(b)(1) and (b)(3). Here, MERS, after its own investigation, determined that the number of class members, amount in controversy, and minimal diversity were satisfied sufficient for CAFA jurisdiction pursuant to 28 U.S.C. § 1332(d). The question remains whether a defendant may, as MERS did here, remove аn action outside of the 30-day removal limits delineated in 28 U.S.C. §§ 1446(b)(1) and (b)(3) or if they are the exclusive time periods during which a defendant may remove.
As an initial matter, we note, as have our sister circuits, that “[t]he moment a case becomes removable and the moment the 30-day removal clock begins to run ‘are not two sides of the same coin.’ ” Walker,
As the Seventh Circuit explained in Walker:
Whether the jurisdictional prerequisites [of 28 U.S.C. § 1332(d) ] are in fact met is a separate determination [from whether removal is timely] and often involves consideration of materials outside the state-court pleadings. The removing defendant has the burden of proving the jurisdictional predicates for removal. In contrast, the timeliness inquiry [governed by 28 U.S.C. §§ 1446(b)(1) and (b)(3)] is limited to [] examining contents of the clock-triggering pleading or other litigation paper; the question is whether that document, on its face оr in combination with earlier-filed pleadings, provides specific and unambiguous notice that the case satisfies federal jurisdictional requirements and therefore is removable.
When neither 30-day removal clock of 28 U.S.C. § 1446(b) was triggered, may MERS remove based on its own investigation? Implicit is the question of whether the two 30-day periods listed in 28 U.S.C. §§ 1446(b)(1) and (b)(3) are the exclusive authorizations for removal. The Ninth Circuit has resolved this question, and we agree with its approach. In Roth v. CHA Hollywood Medical Center, L.P.,
The Ninth Circuit held that “ §§ 1441 and 1446, read together, permit a defendant to remove outside the two thirty-day periods [of 28 U.S.C. § 1446(b) ] on the basis of its own information, provided that it has not run afoul of either of the thirty-day deadlines.” Id. at 1125. Because the complaint in that case did not reveal on its face that there was a sufficient basis for jurisdiction under CAFA, the Ninth Circuit held that it was appropriate for the defendants to remove the ease after they completed their own investigation. Id. The court noted, “It would be odd, even perverse, to prevent removal in this case, and we see nothing in the text of §§ 1441 and 1446 to require such a result.” Id. We also note that this result is consistent with our sister circuits that have addressed this issue and concluded, at least implicitly, that removal is permissible outside of the 30-day periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3) where a defendant’s own investigation yields evidence of removability. See Mumfrey,
We agree with the Ninth Circuit that the text of 28 U.S.C. § 1446(b) does not indicate that the two 30-day periods listed therein are the exclusive authorizations оf removal. See Roth,
The plaintiffs here suggest this approach could result in “gamesmanship” and intentional delay by defendants. However, the Ninth Circuit addressed this argument in Roth. The Ninth Circuit noted that, because there is no one-year limitation on removals in CAFA cases pursuant to 28 U.S.C. § 1453(b), it is “at least theoretically possible in a CAFA case for a defendant to wait until the state court has shown itself ill-disposed to defendant, or until the eve of trial in state court, before filing a notice of removal.” Id. at 1126. But, the Ninth Circuit observed:
[P]laintiffs are in a position to protect themselves. If plaintiffs think that their action may be removable and think, further, that the defendant might delay filing a notice of removal until a strategically advantageous moment, they need only provide to the defendant a document from which removability may be ascertained. Such a document will trigger the [§ 1446(b)(3) ] 30-day removal period[.]
Id. (internal citation omitted). We also believe that, in most cases, defendants will likely remove as soon as the existence of federal jurisdictional predicates becоmes apparent.
CONCLUSION
We hold that, in CAFA cases, the 30-day removal periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3) are not triggеred until the plaintiff serves the defendant with an initial pleading or other document that explicitly specifies the amount of monetary damages sought or sets forth facts from which an amount in controversy in excess of $5,000,000 could be ascertained. We also hold that where these documents fail to trigger the removal periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3), a defendant may remove a case when, upon its own independent investigation, it determines that the case is removable. Thus, we hold that the 30-day removal periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3) are not the exclusive authorizations of removal in CAFA cases.
In this case, the plaintiffs never served MERS with a complaint or subsequent document explicitly stating the amount m controversy or providing MERS with sufficient information to conclude the threshold amount in controversy was satisfied. Therefore, the removal clocks of 28 U.S.C. §§ 1446(b)(1) and (b)(3) did not commence. After MERS determined upon its independent investigation that 28 U.S.C. § 1332(d) conveyed CAFA federal jurisdiction because the amount in controversy, number of plaintiffs, and minimal diversity requirements were satisfied, it properly removed the case by alleging facts adequate to establish the amount in controversy in its notice of removal. We therefore VACATE the district court’s order remanding the case to state court and REMAND the case for proceedings consistent with this opinion.
Notes
. MERS contests the plaintiffs’ categorization of the relevant electronic documents as "Esign” mortgages, but this dispute is not relevant to the present appeal.
. MERS is not itself a lender and did not loan the plaintiffs the funds for the initial mortgage or refinanced mortgage.
. A declaration filed by MERS on July 16, 2013, further explains: "Assuming that even half of the registered eNotes secured by a MERS mortgage in New York are the basis for claims that Plaintiffs were wrongly forced to pay a mortgage tax, using a conservatively low number of $3,000.00 in damages for each potential plaintiff in the putative class, Plaintiffs’ aggregate claims would reach $5.5 million.”
. 28 U.S.C. § 1446(b)(1) also provides a removal time period of "within 30 days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant....”
. The plaintiffs in this case do not argue that MERS failed to allege adequate facts to establish removability in its notice of removal or subsequent declaration.
. Given our holding that MERS timely removed this case, we do not reach the question, as MERS urges us, of whether the plaintiffs' cause of action presents a federal question sufficient for jurisdiction pursuant to 28 U.S.C. § 1331.