Free Memorandum in Opposition - District Court of California - California

Case 3:07-cv-05110-WHA

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Elwood Lui (SBN 45538) [email protected] Thomas A. Rector (SBN 199175) [email protected] JONES DAY 555 California Street, 26th Floor San Francisco, CA 94104 Telephone: (415) 626-3939 Facsimile: (415) 875-5700 Hugh Whiting [email protected] (pro hac vice application to be filed) JONES DAY 717 Texas, Suite 3300 Houston, TX 77002 Telephone: (832) 239-3939 Facsimile: (832) 239-3600 Thomas E. Fennell [email protected] (pro hac vice application to be filed) Michael L. Rice [email protected] (pro hac vice application to be filed) JONES DAY 2727 N. Harwood St. Dallas, TX 75201 Telephone: (214) 220-3939 Facsimile: (214) 969-5100 Attorneys for Defendants MATTEL, INC. AND FISHER-PRICE, INC. UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA ­ SAN FRANCISCO DIVISION

AMY HARRINGTON, on behalf of herself and all others similarly situated, Plaintiff, v. MATTEL, INC. a Delaware Corp., and FISHER-PRICE INC. a Delaware Corp., and DOES 1 through 100, inclusive, Defendants.

Case No. 07-05110 (MJJ)

[PROPOSED] ORDER DENYING PLAINTIFF'S MOTION TO REMAND

[PROPOSED] ORDER DENYING PLAINTIFF'S MOTION TO REMAND CASE NO. 07-05110 (MJJ)

Case 3:07-cv-05110-WHA

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Filed 11/20/2007

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I. BACKGROUND This action is one of eighteen putative class actions currently pending in federal district courts which were all filed following voluntary toy recalls announced by Defendants on August 2, August 14, September 4, and October 25, 2007. On September 5, 2007, Defendants filed a motion with the Judicial Panel on Multidistrict Litigation (the "JMPL") seeking to have all of the cases coordinated for pretrial in one proceeding in the United States District Court for the Central District of California. The JMPL has set the motion to transfer for hearing on November 29, 2007. Plaintiff in this action served Defendants with the complaint and summons on September 11, 2007. Defendants timely removed this case on October 4, 2007 pursuant to the Class Action Fairness Act of 2005, ("CAFA"), codified in relevant part at 28 U.S.C. §§ 1332(d) and 1453. On November 5, 2007, Plaintiff filed a Motion to Remand ("Motion"). The Motion is based on only two grounds: (1) Plaintiff contends Defendants have not proved by a preponderance of evidence that the amount in controversy exceeds the $ 5 million CAFA jurisdictional threshold; and (2) that the case is subject to remand based upon the home-state controversy exception of 28 U.S.C. § 1332(d)(4)(B). Plaintiff does not set forth any other basis for remand. II. LEGAL STANDARD A. AMOUNT IN CONTROVERSY

Under CAFA, the controlling question for purposes of evaluating the amount in controversy requirement is whether the aggregate amount of damages and other relief sought for the alleged class exceeds $ 5 million. If the court is uncertain whether the threshold is met, "[t]he district court should interpret expansively its power to aggregate individual class members claims, and where the court is in doubt whether the aggregated claims exceed $ 5 million, the court should err in favor of exercising jurisdiction over the case." Romeo v. The Home Depot U.S.A., Inc., 2006 U.S. Dist. LEXIS 79881, at * 4-5 (S.D. Cal. Oct. 30, 2006) (quoting from S. Rep. No. 109-14, at 42 (2005), as reprinted in 2005 U.S.C.C.A.N. 3, 41). -2[PROPOSED] ORDER DENYING PLAINTIFF'S MOTION TO REMAND CASE NO. 07-05110 (MJJ)

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Plaintiff seeks unspecified damages and a broad range of relief on behalf of the putative class. To meet the CAFA amount in controversy standard, Defendants need only show by a "preponderance of the evidence" that $ 5 million is put at issue. Guglielmino v. McKee Foods Corp., 2007 U.S. App. LEXIS 23654, at *14 (9th Cir. October 9, 2007). Thus, Defendants need only "produce underlying facts showing only that it is more likely than not that the amount in controversy exceeds $ 5,000,0000, assuming the truth of the allegations plead in the Complaint." Muniz v. Pilot Travel Centers LLC, 2007 WL 1302504, at *5 (E.D. Cal. May 1, 2007) (slip copy) (emphasis in original); see also Davis v. Chase Bank U.S.A., N.A., 453 F. Supp. 2d 1205, 1208 (C.D. Cal. 2006). This "burden is not daunting, as courts recognize that under this standard, a removing defendant is not obligated to research, state, and prove the plaintiff's claims for damages." Muniz, 2007 WL 1302504, at *2 (emphasis in original) (quotation and citation omitted). B. 28 U.S.C. § 1332(D)(4)(B) "HOME-STATE" CONTROVERSY EXCEPTION

The Ninth Circuit holds "that the party seeking remand bears the burden of proof as to any exception under CAFA." Serrano v. 180 Connect, Inc., 478 F.3d 1018, 1019 (9th Cir. 2007). Thus, Plaintiff bears the burden of proving that two-thirds or more members of the putative class and the "primary defendants" are citizens of California. See 28 U.S.C. § 1332(d)(4)(B) exception to CAFA ("home-state controversy exception"). III. ANALYSIS A. AMOUNT IN CONTROVERSY

In the Notice of Removal, Defendants focused on one component of the alleged class and provide evidence that approximately 29,900 products subject to the August 2, 2007 recall were sold to consumers in California. Focusing on the consumer component of the alleged class, the question then is what is the amount in controversy put at issue by Plaintiff's Complaint. The "ultimate inquiry is what amount is put `in controversy' by the plaintiff's complaint, not what a defendant will actually owe." Muniz, 2007 WL 1302504, at *3; Levine v. Bic USA, Inc., 2007 WL 2406897, at *2 (S.D. Cal. Aug. 20, 2007). While all of Plaintiff's requested relief must be included in assessing the aggregated CAFA amount in controversy, the potential costs associated -3[PROPOSED] ORDER DENYING PLAINTIFF'S MOTION TO REMAND CASE NO. 07-05110 (MJJ)

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with Plaintiff's demand for putative class-wide medical testing and monitoring alone meet the requisite amount in controversy. Plaintiff's claims for medical testing and medical monitoring relief put at issue two separate components: 1) medical testing for detection of lead poisoning (Complaint, ¶¶ 21; 22; 32); and 2) subsequent, future, medical monitoring (Complaint, ¶¶ 52; 58). Based upon published materials recommending at least two different blood lead level tests ("BLL tests") and a clinical examination, as well as a showing that a single BLL test is more than $ 60, it is likely the costs per child would exceed $ 200. Thus, given the size of the putative class and potential medical testing and medical monitoring costs in excess of $ 200 per putative class member, it is more likely than not that the amount in controversy exceeds $ 5 million on just these costs alone even before adding Plaintiff's estimated $ 1.45 million for restitution and warranty economic relief. See Sanchez v. Wal-Mart Stores, Inc., 2007 WL 1345706 at *2 (E.D. Cal. May 8, 2007) (slip copy); see also Davis, 453 F. Supp. 2d at 1208 ("[plaintiff] provides no evidence that [defendants'] calculations are incorrect, and given the allegations, this amount seems a reasonable estimate."); Robinson v. Cheetah Transp., 2006 U.S. Dist. LEXIS 10129, at *8-9 (W.D. La. Feb. 24, 2006). Assuming the truth of the allegations in Plaintiff's Complaint and totaling all the costs Plaintiff seeks to impose on Defendants, Defendants have met their burden by showing that it is more likely than not that the amount in controversy exceeds $ 5 million. B. 28 U.S.C. § 1332(D)(4)(B) "HOME-STATE" CONTROVERSY EXCEPTION

Plaintiff bears the burden of proving the home-state controversy exception. While Plaintiff cites to the residency of putative class members, the home-state controversy exception is based on citizenship. As "[c]itizenship is determined by one's `state of domicile,' not his state of residence," Kanaan v. Freescale Semiconductor, Inc., 2007 U.S. Dist. LEXIS 11736, *6 (N.D. Cal. Feb. 5, 2007), Plaintiff's failure to prove that two-thirds or more of the putative class are citizens of California is fatal to her invocation of the exception. See Anthony v. Small Tube Mfg. Corp., 2007 U.S. Dist. LEXIS 73064, at *12 (E.D. Pa. Sept. 27, 2007). Plaintiff's "primary defendant" argument fails because Plaintiff asserts claims and alleges direct liability against both Fisher-Price and Mattel. Plaintiff's unsupported assertion that Mattel is the primary defendant -4[PROPOSED] ORDER DENYING PLAINTIFF'S MOTION TO REMAND CASE NO. 07-05110 (MJJ)

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fails to meet Plaintiff's burden of proof as to both the home-state controversy exception and fundamental elements of corporate law. IV. CONCLUSION For the foregoing reasons, the Court DENIES Plaintiff's Motion to Remand. IT IS SO ORDERED. Dated: ___________, 2007 By: _______________________ Judge Martin J. Jenkins United States District Judge

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[PROPOSED] ORDER DENYING PLAINTIFF'S MOTION TO REMAND CASE NO. 07-05110 (MJJ)

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