OPINION
I. INTRODUCTION
This is a putative consumer class action suit against Defendant Johnson & Johnson Consumer Companies, Inc. (“Johnson & Johnson”) for alleged deceptive labeling and advertising practices related to their line of BEDTIME® products, which are marketed to help babies sleep better. The case, which alleges violations of the New Jersey Consumer Fraud Act (“NJCFA”), N.J.S.A. § 56:8-1, et seq., was filed in New Jersey state court, but was subsequently removed by Defendant to this Court.
Presently before the Court is Plaintiffs motion to remand the case back to the Superior Court [Docket Item 14], and Defendant’s motion to transfer the case to the Central District of California [Docket Item 4], Because the case does not meet the jurisdictional requirements of the Class Action Fairness Act of 2005 (“CAFA”), 28 U.S.C. § 1332(d)(2), the Court will grant Plaintiffs motion and remand this case back to the Superior Court. Defendant’s motion to transfer will be dismissed as moot.
II. BACKGROUND
In this putative class action, Plaintiff Jillian Gallagher alleges that Defendant Johnson & Johnson engaged in false and deceptive sale and advertising practices with its JOHNSON’S® BEDTIME® Bath and JOHNSON’S® BEDTIME® Lotion products (collectively, “Bedtime products” or “Products”), which are marketed for babies. Specifically, Plaintiff alleges that the Bedtime products, which are sold at a premium over Defendant’s other baby washes and lotions, falsely advertise that they are “clinically proven” to “help baby sleep better.” Plaintiff alleges that ho studies show that the Bedtime products are clinically proven to provide any results, and Defendant has no basis for its claim. (Compl. [Docket Item 1] ¶¶ 1-3.)
The Complaint alleges a cause of action under New Jersey’s Consumer Fraud Act, N.J.S.A. § 56:8-1, et seq. Johnson & Johnson is a New Jersey company, and Plaintiff, a New Jersey consumer who purchased Defendant’s products in New Jersey, filed the case in the Superior Court of New Jersey, Camden County, Law Division. The putative class is defined in the Complaint as
[a]ll New Jersey citizens who purchased the Bedtime Products within New Jersey, not for resale or assignment.
(Compl. ¶ 48.)
Three other putative class action complaints alleging deceptive advertising practices for BEDTIME® products were also filed against Defendants in federal district courts in California, Illinois, and New York: Real v. Johnson & Johnson Consum
Invoking federal jurisdiction under the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2), Johnson & Johnson removed the suit to the District of New Jersey under 28 U.S.C. § 1446, and shortly thereafter, filed a motion to transfer this case to the Central District of California [Docket Item 4]. Plaintiff opposed the transfer [Docket Item 16], and filed a motion to remand the case back to state court [Docket Item 17], asserting that the requirements for federal jurisdiction under CAFA are not satisfied because the parties are all New Jersey citizens.
Because this Court’s subject matter jurisdiction has been placed in dispute, Plaintiffs remand motion will be decided first.
III. PLAINTIFF’S MOTION TO REMAND
A. The Removal Statute and Requirements for Diversity Jurisdiction Under CAFA
The removal statute, 28 U.S.C. § 1441(a), permits only state-court actions that originally could have been filed in federal court to be removed. 28 U.S.C. § 1441(a) (“[A]ny civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed ... to the district court of the United States for the district and division embracing the place where Such action is pending.”); see also Caterpillar Inc. v. Williams,
Because Gallagher’s Complaint contains only claims under the NJCFA, there is no federal question jurisdiction under 28 U.S.C. § 1331. At issue is whether the Court has diversity jurisdiction to hear Plaintiffs claims.
Diversity jurisdiction in class action cases is governed by the Class Action Fairness Act of 2005. Congress passed CAFA to put an end to certain allegedly abusive practices by plaintiffs’ class counsel, and because it was concerned that class actions were too often precluded from federal court by unnecessary procedural requirements. See S. Rep. No. 109-14, at 43, 2005 U.S.C.C.A.N. 3, 41 (2005); see also Kaufman v. Allstate New Jersey Ins. Co.,
Before the enactment of CAFA, courts looked to 28 U.S.C. § 1332(a) to determine whether they had diversity jurisdiction over class actions, and required that each named member of the plaintiff class be diverse from each of the defendants. See, e.g., Snyder v. Harris,
CAFA also provides several exceptions to federal court jurisdiction, one of which is called the “home state” exception. Under this exception, the district court must decline to exercise jurisdiction where “two-thirds or more of the members of all proposed plaintiff classes in the aggregate, and the primary defendants, are citizens of the State in which the action was originally filed.” 28 U.S.C. § 1332(d)(2)(4)(B). If a class action case falls into this category, a district court must remand it back to the state court where it was originally filed. See Vodenichar v. Halcon Energy Properties, Inc.,
B. Standard of Review and Burden of Persuasion
Although removal statutes must generally be strictly construed, with any doubt to be resolved in favor of remand, see, e.g., Brown v. Jevic,
To decide whether CAFA’s jurisdictional requirements are satisfied, a court will consider the allegations in the complaint and in the defendant’s notice of removal. Judon v. Travelers Property Cas. Co. of Am.,
C. The Parties’ Arguments
As noted above, the dispute in this case revolves around whether CAFA’s minimum diversity requirements have been met. Johnson & Johnson is a citizen of New Jersey because it is a New Jersey corporation with a principal place of business in Skillman, New Jersey. (Compl. ¶ 11.) See 28 U.S.C. § 1332(c)(1) (“[A] corporation shall be deemed to be a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business .... ”). The class representative, Jillian Gallagher, is also a citizen of New Jersey and purchased Defendant’s Bedtime products at a pharmacy in Berlin, New Jersey. (Compl. ¶ 40.)
The dispute over diversity jurisdiction lies with the scope of the plaintiff class and the citizenship of its members. Pointing to the class definition, Plaintiff contends that every member of the class is, by definition, a New Jersey citizen. She also argues that even if there is minimum diversity, the “home state” exception in CAFA would require this case to be remanded back to state court. (Mot. to Remand, at 4-9,11-13; Reply in Support of Mot. to Remand [Docket Item 19], at 2-3, 7-8.)
Johnson & Johnson argues that the Court should look beyond the class definition because elsewhere in the Complaint, Plaintiff broadly construes the putative class members to include all those who purchased Defendant’s Bedtime products in New Jersey. Defendant argues that the class therefore potentially includes non-New Jersey citizens who traveled to New Jersey to buy the products. Citing Schwartz v. SCI Funeral Servs. of Fla., Inc.,
D. Plaintiff has Appropriately Limited the Putative Class Members to New Jersey Citizens
Because resolution of this jurisdictional dispute depends upon how the class members are defined, the Court turns first to Plaintiffs Complaint. As noted above, the Complaint defines the class as “New Jersey citizens” who purchased Bedtime products in the state. (Compl. ¶48.) Rather than use Plaintiffs class definition, Defendant urges the Court to define the class from other parts of the Complaint, specifically, to two sentences in the Preliminary Statement and Statement of Facts which suggest that the relief is being sought on behalf of all individuals who purchased Defendant’s products in New Jersey. (See Compl. ¶5 (“This class action seeks to provide redress to consumers in New Jersey who have been harmed by the false and misleading practices Defendant has engaged in .... ”); id. ¶ 13 (“This class action is brought against J&J for the benefit and protection of all purchasers of Bedtime Products in New Jersey.”); see also id ¶ 6 (“Plaintiff brings this action to obtain redress for those who have purchased the Bedtime Products”).) Defendant argues that because this broader class definition will include out-of-state residents who made New Jersey purchases, minimum diversity under 28 U.S.C. § 1332(d)(2)(A) is satisfied. (Opp’n to Mot. to Remand, at 4-8.)
The Court is unpersuaded by Defendant’s approach. First, courts generally look to the plaintiffs proposed class definí
Plaintiff’s “class definition” is plainly noted in the Complaint. Under “Class Action Allegations,” Plaintiff specifically states that she seeks “injunctive and other relief on behalf of herself and all other similarly situated members of the class, defined as [a]ll New Jersey citizens” who purchased Defendant’s products in New Jersey, “not for resale or assignment.” (Compl. ¶ 48.) Defendant’s argument for using stray allegations from other parts of the pleading to define the class may be more convincing if the parameters of the proposed class were unclear, but that is not the case here. There is nothing ambiguous about Plaintiffs definition of the parties to be included in this suit.
If that were not enough, Plaintiff has also clarified in her motion to remand that the class members in this action are New Jersey citizens who purchased Defendant’s products in New Jersey. In other words, Plaintiff has affirmed that the class definition accurately defines the class, and the class does not include any non-New Jersey citizens. (Mot. to Remand, at 6-7.) It is readily apparent that Plaintiff has chosen to limit the proposed class to citizens of this state, and the Court is not at liberty at this stage to reject Plaintiffs class definition and render a different interpretation.
Nor does the Court find the restriction to New Jersey plaintiffs problematic. Although the Court agrees with Defendant that it should “look behind the pleadings to ensure that parties are not improperly creating or destroying diversity jurisdiction,” there is nothing improper about limiting a putative class to only citizens from this state. (Opp’n to Mot. to Remand, at 6 (quoting Mississippi ex rel. Hood v. AU Optronics, — U.S. —,
Defendant’s contention, that the class will nevertheless include some individuals who are no longer New Jersey residents, is equally without merit. Defendant notes that individuals who were New Jersey citizens at the time of purchase may have since relocated and become citizens of other states. (Opp’n to Mot. to Remand, at 6.) That argument, however, ignores the basic rule that class is determined at the time the complaint was filed. See 28 U.S.C. § 1332(d)(7) (“Citizenship of the members of the proposed plaintiff classes shall be determined ... as of the date of filing of the complaint or amended complaint .... ”). Thus, an individual who was a New Jersey citizen at the time of injury but who established domicile outside the state before Plaintiff filed her complaint would not qualify as a “citizen of New Jersey” at the time the complaint was filed. These individuals were not, and would not be, included as class members and would have no impact on whether minimal diversity exists. Likewise, because “’jurisdiction of the Court ... cannot be ousted by subsequent events,”’ a class member who moved to another state after the complaint was filed would not affect the jurisdictional analysis. Kaufman v. Allstate N.J. Ins. Co.,
E. Real Parties in Interest are Not Included for Purposes of Determining Diversity Jurisdiction Under CAPA
The Court now turns to Defendant’s argument that the Court should take into account the citizenship of consumers nationwide, all of whom, Defendant argues, stand to benefit from this lawsuit. Defendant’s argument stands on a single Florida district court case, Schwartz v. SCI Funeral Servs. of Fla., Inc.,
Defendant seeks the same result here— it wishes this Court to include real parties in interest as class members for purposes of determining diversity jurisdiction under CAFA. As Defendant’s citation to a Florida case suggests, the Third Circuit has not had an occasion to consider this specific question. Because CAFA’s jurisdictional statute is directly implicated, the court’s analysis must begin with the statutory text before turning to Schwartz. See Mississippi ex rel. Hood v. AU Optronics Corp., — U.S. —,
The Court starts with the fundamental axiom that Congress “says in a statute what it means and means in a statute what it says there.” Connecticut Nat. Bank v. Germain,
In this case, the text of 28 U.S.C. § 1332(d) provides clear guidance. 28 U.S.C. § 1332(d)(2) gives the district courts jurisdiction over a class action where the amount in controversy has been met and “any member of a class of plaintiffs is a citizen of a State different from any defendant.” 28 U.S.C. § 1332(d)(2)(A) (emphasis added). In turn, § 1332(d)(1) defines “class members” as it is used in (d)(2) to mean “the persons (named or unnamed) who fall within the definition of the proposed or certified class in a class action.” 28 U.S.C. § 1332(d)(1)(D) (emphasis added). Taken together, these provisions instruct the court to look to the citizenship of those persons who fall within the “proposed class” for purposes of determining diversity.
CAFA does not define the term “proposed class,” and the court must construe the term in accordance with its “ordinary or natural meaning.” F.D.I.C. v. Meyer,
What’s more, 28 U.S.C. § 1332(d)(2)(A) makes clear that for purposes of determining whether there is minimum diversity, the courts should look to the citizenship of the class members as defined by § 1332(d)(1) — the “proposed or certified class”. It makes no mention of examining the citizenship of additional individuals. This omission is significant. It is a well-established rule of statutory interpretation that legislative intent “’can be derived only from the words they have used; and [courts] cannot speculate beyond the reasonable import of those words.’” Univ. of Tex. Sw. Med. Ctr, v. Nassar, — U.S. —,
Under the plain language of § 1332(d), only those who fall within the proposed class definition set forth by the plaintiff are considered for purposes of determining CAFA jurisdiction. “[W]hen judges must decide jurisdictional matters, simplicity is a virtue.” Standard Fire Ins. Co. v. Knowles, — U.S. —,
Athough Defendant urges this Court to disregard the recent Supreme Court case Mississippi ex rel. Hood v. AU Optronics Corp., — U.S. —,
The reasoning in AU Optronics applies just as well in the instant case and forecloses Defendant’s argument. Here, “persons (named or unnamed) who fall within the definition of the proposed ... class in a class action” refers only to individuals whose interests the plaintiff seeks to represent in the case, which is set forth in the “proposed class definition” in the class action complaint. Individuals who do not fall within plaintiffs class definition — in this case, non-New Jersey citizens — have not
Importantly, 28 U.S.C. § 1332(d)(2), which relies on the definitions set forth in § 1332(d)(1), refers to the citizenship of “any member of a class of plaintiffs.”
Reading § 1332(d)(1) in harmony with § 1332(d)(2), the Court holds that “class member” means a person who falls within the proposed “class of plaintiffs” as defined by plaintiffs class definition, and who is therefore a proposed plaintiff himself.
F. Defendant’s Citation to Schwartz is Unpersuasive.
Defendant’s argument is propped up only by Schwartz v. SCI Funeral Servs. of Fla., Inc.,
The ramifications of the Schwartz plaintiffs’ lawsuit clearly stretched beyond the state, since the relief they sought unavoidably implicated the rights of non-Florida citizens. The same cannot be said of Gallagher’s case. The legal rights of non-New Jersey citizens will not be impacted by an injunction which rectifies alleged deceptive advertising practices. Further, a grant of money damages to a class of New Jersey plaintiffs does not change the amount of money that non-class members may seek. Johnson & Johnson is, of course, correct that non-New Jersey citizens who bought Bedtime products will benefit if Defendant is forced to change the label, but that argument holds little sway. All consumers of a product benefit from a class action when the product is changed to comply with the law, but that alone does not transform them into real parties in interest. In short, there is no strong interstate dimension in this case that triggers CAFA’s jurisdictional concerns and that calls out for a federal forum. See Class Action Fairness Act of 2005, Pub. L. No. 109-2 § 2(b)(2) (CAFA was enacted to prevent states from making “judgments that impose their view of the law on other States and bind the rights of the residents of those States); West Virginia ex rel. McGraw v. CVS Pharmacy, Inc.,
Aside from the distinguishing facts, there are other reasons why this Court is hesitant to apply Schwartz. First, Schwartz did not consider the statutory text, and instead relied solely upon a Fifth Circuit case which applied the rule in a distinct context. In that case, Louisiana ex rel. Caldwell v. Allstate Ins. Co.,
Regardless of whether Schwartz was correct to apply Caldwell to a suit where no state party was involved, Caldwell has little application to the instant case. The state is not a plaintiff in this action. Nor does Plaintiff seek to vindicate the rights of unnamed parties who are not before the Court. Gallagher does not ask to recover damages for all consumers who were harmed — she seeks money damages only for putative class members consisting of
It is apparent to the Court that Plaintiff in this case intended to restrict the class of plaintiffs to only New Jersey citizens. As Plaintiff may choose claims and parties to avoid federal jurisdiction, doing so was not improper. Moreover, because the text of 28 U.S.C. § 1332(d)(1) and (d)(2) does not support the counting of non-class members who may be real parties in interest, for purposes of determining diversity, the parties consist of a New Jersey defendant and a putative class of New Jersey plaintiffs.
The requirements of diversity jurisdiction under § 1332(d)(2)(A) have not been met, and removal would not serve CAFA’s articulated interest in providing a federal forum for disputes reaching across state borders. See West Virginia ex rel. McGraw v. CVS Pharmacy, Inc.,
G. Remand is also Required Under CAFA’s “Home State” Exception
As noted above, CAFA’s “home state” exception provides that a federal
The Court readily agrees with Plaintiff that the “home state” exception provides a second basis for remand. There is no question that more than two-thirds of the putative class members are New Jersey citizens. Defendant’s argument, that Plaintiff has failed to present “evidence, not merely assertions or guesses,” that the class reaches the threshold minimum citizenship, rings hollow, particularly in light of how Plaintiff has chosen to define the class. (Def. Opp’n to Mot. to Remand, at 12-14.) This is not a case in which the class consists of all purchasers in a given state, in which a purchaser’s residence in the state is not a foregone conclusion. Under Plaintiffs proposed definition, New Jersey citizenship is a prerequisite for class membership. Extensive documented proof is not required to confidently reach the conclusion that a proposed class consisting of “[a]ll New Jersey citizens” contains at least two-thirds New Jersey citizens.
Plaintiffs have proven that this case satisfies CAFA’s “home state” exception, and remand is also required under 28 U.S.C. § 1332(d)(2)(4)(B).
Because the Court is without federal subject matter jurisdiction to consider the case, the Court will dismiss without prejudice Defendant’s application to transfer venue to another district, because it is moot. See, e.g., Coldwell Banker Real Estate, LLC v. Jupe Real Estate, LLC,
V. CONCLUSION
For the foregoing reasons, the Court will grant Plaintiffs motion to remand and will remand this case to the Superior Court of New Jersey, Camden County, Law Division. Defendant’s motion to transfer will be dismissed as moot. The accompanying Order for Remand will be entered.
Notes
. In its Motion to Transfer, Defendant misidentified the docket number of the Hidalgo case as 15-cv-5119. The correct docket number is 15-cv-5199.
. To the extent Defendant seeks to attack the appropriateness of the class definition, it will have ample opportunity to do so at the class certification stage. See Tahir v. Avis Budget Grp., Inc., No. 09-3495,
. Black’s Law Dictionary defines a "proposal” as "[s]omething offered for consideration or acceptance.” Black’s Law Dictionary 1339 (9th ed. 2009). Similarly, Merriam-Webster Online defines the word "propose” to mean "to form or put forward a plan or intention” and "to set forth for acceptance or rejection.” Merriam-Webster Online Dictionary, www. merriam-webster.com/dictionary/proposal. The Tenth Circuit analyzed the word "propose” as it appears in the CAFA statute defining a “mass action,” and noted that “propose” commonly "involves an intentional act.” Parson v. Johnson & Johnson,
. It is, therefore, of no moment that Plaintiffs have filed class action suits in three other courts with a similar set of facts and plaintiffs who are not residents of New Jersey. The Court agrees with the First Circuit that CAFA’s home state exception does not depend “on a broader assessment of the claims brought by others who do not fall within the complaint’s class definition or of the claims available to the class against other possible defendants.” In re Hannaford Bros. Co. Customer Data Security Breach Litig.,
. This is no mistake. Subsequent subsections also refer to “members of all proposed plaintiff classes,” and "members of the proposed plaintiff classes.” See 28 U.S.C. §§ 1332(d)(3), (d)(4), (d)(5)(B), (d)(7).
. Defendant incorrectly argues that the Supreme Court, in rejecting the practice of counting of real parties in interest to satisfy the numerosity requirement, implicitly condoned the practice of using real parties in interest for purposes of deciding diversity under CAFA. (See Opp’n to Mot. to Remand, at 10.) The Court did no such thing. On the contrary, it noted that courts must look behind the pleadings “in certain contexts” to ensure that parties are not improperly creating or destroying diversity jurisdiction, and went on to note only one context in which the court was allowed to inquire into the real party in interest. That was in "cases involving a State or state official,” because in those instances, "a State's presence as a party will destroy complete diversity.” AU Optronics,
. Of course, as a Florida case, Schwartz is of interest but is not precedent in this district. And because it was decided before AU Op-tronics, there is the question of whether its decision remains good law. The Court is unmoved by Defendant’s argument that Schwartz was affirmed by the Eleventh Circuit less than a month after the AU Optronics decision. See Schwartz v. SCI Funeral Servs. of Fla., Inc.,
. The remand, of course, does not permanently shut the federal court's door to Defendant. Under CAFA, Defendants are free to petition for removal "well into the course of litigation” should litigation documents later reveal facts supporting federal jurisdiction. Judon v. Travelers Prop. Cas. Co. of Am.,
. Here, Defendant's argument is undermined by its own cited case, Dicuio v. Brother Int'l Corp., No. 11-1447,
. The Court will, however, deny Plaintiff's request for attorneys’ fees and costs under 28 U.S.C. § 1447(c). Section 1447(c) permits a court, at its discretion, to "require payment of just costs and any actual expenses, including attorney fees, incurred as a result of removal.” Absent "unusual circumstances,” attorney’s fees may be awarded "only where the removing party lacked an objectively reasonable basis for seeing removal.” Martin v. Franklin Capital Corp.,