Seyfarth Shaw LLP | www.seyfarth.com Litigating CA Wage & Hour and Labor Code Class Actions (22nd Edition) 95 Defendants eager to remove a case should also consider the possibility of sanctions in the event their removal petition is deemed unreasonable. The Supreme Court has noted that an award of costs and fees is permissible, under Section 1447(c), when “such an award is just” and “the removing party lacked an objectively reasonable basis for removal.”568 The Ninth Circuit had also previously stated that an award of attorney fees is permitted even when defendant’s removal was “fairly supportable,” but wrong as a matter of law.569 However, a California federal district court has held that all a defendant may need to support the removal is an argument “that is not irrational or implausible.”570 3. Establishing The “Amount In Controversy” In A CAFA Removal If a complaint alleges damages in excess of $5 million, then the amount in controversy is “presumptively satisfied” unless it appears to a legal certainty that the claim is actually for less than the jurisdictional minimum.571 If the complaint fails to specify any amount in damages, the removal papers must provide the court with facts to support the jurisdictional amount. Moreover, the U.S. Supreme Court has held that the defendant seeking removal must prove by a “preponderance of the evidence“ that the amount in controversy has been met.572 Yet the removing defendant is not limited to proof of the pre-removal amount in controversy. The Ninth Circuit has recognized that the amount in controversy is “not limited to damages incurred prior to removal—for example, it is not limited to wages a plaintiff-employee would have earned before removal (as opposed to after removal). Rather, the amount in controversy is determined by the complaint operative at the time of removal and encompasses all relief a court may grant on that complaint if the plaintiff is victorious.”573 The amount in controversy also may include attorneys’ fees that the prevailing party is entitled to recover under the applicable statute.574 And the amount in attorneys’ fees is not limited to the fees incurred at the time of the removal. The Ninth Circuit has held that “a court must include future attorneys’ fees recoverable by statute or contract when assessing whether the amount-in-controversy requirement is met.”575 The third scenario is when the complaint affirmatively states that the amount in controversy is less than $5 million. The Ninth Circuit addressed 568 Martin v. Franklin Capital Corp., 546 U.S. 132 (2005); see also Mosaic Sys., Inc. v. Bechtolsheim, 2007 WL 3022581, at *5 (N.D. Cal. Oct. 15, 2007) (denying request for fees and costs given “objectively reasonable” basis for removal); Gardner v. UICI, 508 F.3d 559, 561-62 (9th Cir. 2007) (reversing award of fees and costs where removing party had “an objectively reasonable basis for removal;” if a “reasonable litigant ... could have concluded that federal court was the proper forum,” a request for fees and costs must be denied). 569 Balcorta v. Twentieth Century-Fox Film Corp., 208 F.3d 1102, 1106 n.6 (9th Cir. 2000). 570 Hornung v. City of Oakland, No. C-05-4825 EMC, 2006 WL 279337 at *4 (N.D. Cal. Feb. 3, 2006). 571 Abrego Abrego, 443 F.3d at 683 n.8. 572 Dart Cherokee Basin Operating Co., LLC, 135 S. Ct. at 554 (“a defendant’s notice of removal need include only a plausible allegation that the amount in controversy exceeds the jurisdictional threshold” and “[e]vidence establishing the amount is required … only when the plaintiff contests, or the court questions, the defendant's allegation”). 573 Chavez v. JPMorgan Chase & Co., 888 F.3d 413 (9th Cir. 2018) (“When we say that the amount in controversy is assessed at the time of removal, we mean that we consider damages that are claimed at the time the case is removed by the defendant.”). 574 Galt G/S v. JSS Scandinavia, 142 F.3d 1150, 1156 (9th Cir. 1998) (“We hold that where an underlying statute authorizes an award of attorneys’ fees, either with mandatory or discretionary language, such fees may be included in the amount in controversy.”). 575 Fritsch v. Swift Transp. Co. of Arizona, LLC, 899 F.3d 785, 794 (9th Cir. 2018).
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