128 Litigating CA Wage & Hour Class and PAGA Actions (23rd Edition) Seyfarth Shaw LLP | www.seyfarth.com the case until a year after the complaint was filed.652 The federal district court held that because the complaint did not specify an amount of damages, the defendant’s filing of a demurrer did not waive its right to remove.653 The court stressed that the defendant did not engage in “any conduct that manifested its intent to stay in state court” after removability was first ascertained, and therefore did not waive its right.654 Similarly, the Ninth Circuit has held that a defendant’s “choice to file a demurrer, rather than another form of responsive pleading, to [plaintiff’s] indeterminate FAC [First Amended Complaint] did not amount to a waiver of its right to remove.”655 F. After Removal and Effect of Denial of Class Certification A long-standing rule set out by the United States Supreme Court (the “Red Cab rule“) is that “events occurring subsequent to removal which reduce the amount recoverable, whether beyond the plaintiff’s control or the result of his volition, do not oust the district court’s jurisdiction once it has attached.”656 Although courts have disagreed over whether denial of class certification affects federal jurisdiction, the trend is to apply the Red Cab rule in this context as well. A number of courts have held that denial of class certification eliminates CAFA jurisdiction as to that federal court, especially if it is not “reasonably foreseeable” that a class will be certified in the future.657 Other courts have held that denial of class certification does not destroy CAFA jurisdiction, because jurisdiction is determined at the moment the case was removed and thus any subsequent changes do not affect the court’s continued jurisdiction.658 Initially, the decisions were split on this issue among the various California federal district courts. In In re HP Inkjet Printer Litigation, a federal district court extended the Red Cab rule to CAFA jurisdiction. The court held that it continued to have subject matter jurisdiction even after denying the motion to certify a nationwide class.659 But in 652 Carvalho v. Equifax Info. Serv. LLC, 2008 WL 2693625, at *4 (N.D. Cal. 2008). 653 Id. 654 Id. 655 Kenny v. Wal-Mart Stores, Inc., 881 F.3d 786, 791 (9th Cir. 2018). 656 St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 293 (1938); Chavez v. JPMorgan Chase & Co., No. 1655957, 2018 WL 1882908, at *3 (9th Cir. Apr. 20, 2018) (“when the amount in controversy is satisfied at removal, any subsequent amendment to the complaint or partial dismissal that decreases the amount in controversy below the jurisdictional threshold does not oust the federal court of jurisdiction”). 657 McGaughey v. Treistman, 2007 WL 24935 at *3-4 (S.D.N.Y. 2007); Gonzalez v. PepsiCo, Inc., 2007 WL 1100204, at *4 (D. Kan. 2007). 658 Vega v. T-Mobile, USA, Inc., 564 F.3d 1256, 1268 at n. 12 (11th Cir. 2009); Cunningham Charter Corp. v. Learjet, Inc., 592 F.3d 805, 806 (7th Cir. 2010); Falcon v. Phillips Electronics N.A., Corp., 489 F. Supp. 2d 367 (S.D.N.Y. 2007); In re HP Inkjet Printer Litig., 2009 U.S. Dist. LEXIS 12271 (N.D. Cal. Feb. 5, 2009); Giannini v. Schering-Plough Corp., 2007 U.S. Dist. LEXIS 48392, at *7-8 (N.D. Cal. June 26, 2007) (holding that jurisdiction was not necessarily divested upon post-removal action and that supplemental jurisdiction provided the basis for retaining subject matter jurisdiction of the claim at hand). 659 In re HP Inkjet Printer Litig., 2009 WL 282051, at *1 (N.D. Cal. Feb. 5, 2009).
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