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Hoffman v. Oils

United States District Court, D. New Jersey

September 10, 2014

HAROLD M. HOFFMAN, Plaintiff,
v.
BARLEAN'S ORGANIC OILS, L.L.C, Defendant.

REPORT & RECOMMENDATION

JAMES B. CLARK, Magistrate Judge.

This matter having been opened to the Court by Plaintiff pro se Harold M. Hoffman's ("Plaintiff') motion to remand this matter to state court for lack of federal subject matter jurisdiction [Docket Entry No. 12]; and Defendant Barlean's Organic Oils, LLC ("Defendant") having opposed Plaintiff's motion [Docket Entry No. 13]; and the Court having considered the arguments submitted in support of, and in opposition to, Plaintiff's motion; and for the reasons that follow, it is respectfully recommended that this action be REMANDED to state court for lack of subject matter jurisdiction.

I. BACKGROUND

Plaintiff[1] filed the instant putative class action in state court on May 13, 2014 alleging various violations of the New Jersey Consumer Fraud Act in connection with Defendant's product, an "omega fatty acid dietary supplement[.]" See Compl. at 1; Docket Entry No. 1-1. The putative class consists of "all New Jersey purchasers of Defendant's product for the two year period preceding the filing of this civil action." Id. at 5. Plaintiff further alleges that "[a]s to the putative plaintiff class, the amount in controversy in this action... is less than $5 million." Id. at ¶27. On June 12, 2014 Defendant removed the matter to federal court, alleging federal jurisdiction under the Class Action Fairness Act ("CAFA"), 28 U.S.C. §1332(d). Notice of Removal at ¶13; Docket Entry No. 1. In its Notice of Removal, Defendant avers that "[a]lthough the allegations in the Complaint purport to disclaim the amount in controversy as less than $5, 000, 000... removal is nonetheless proper because there is more than $5, 00, 000.00 in controversy, based upon a fair reading of the Complaint[.]" Id. at ¶19. Defendant submits that under N.J.S.A. 568-13, it is subject to multiple penalties "of up to $10, 000 for the first offense and up to $20, 000 for the second and each subsequent offense." Id. at ¶32, citing N.J.S.A. 56-8-13. As such, Defendant reasons that it is potentially liable for over $17 million in civil penalties, thus satisfying the amount in controversy requirement for CAFA jurisdiction.

II. LEGAL STANDARD

It is well established that federal courts have a continuing responsibility to raise the issue of subject matter jurisdiction sua sponte whenever it is in question. Fed.R.Civ.P. 12(h)(3). See also Bracken v. Matgouranis, 296 F.3d 160, 162 (3d Cir. 2002). Further, a Court shall dismiss an action where it appears that the Court lacks subject matter jurisdiction. See 28 U.S.C. §1447(c); Fed.R.Civ.P. 12 (h)(3).

Pursuant to 28 U.S.C. §1332(d)(2)

The district courts shall have original jurisdiction of any civil action in which the matter in controversy exceeds the sum or value of $5, 000, 000, exclusive of interest and costs, and is a class action in which - (A) any member of a class of plaintiffs is a citizen of a State different from any defendant[.]

28 U.S.C. § 1332(d)(2).

Any doubts in removal jurisdiction are resolved in favor of remand. Samuel-Bassett v. KIA Motors America, Inc., 357 F.3d 392, 396 (3d Cir. 2004). The parties agree that the exceptions and limitations to the Court's CAFA jurisdiction under subsection (d)(4) do not apply. The only issue before the Court is whether the $5 million threshold for CAFA jurisdiction has been met.

"In any class action, the claims of the individual class members shall be aggregated to determine whether the matter in controversy exceeds the sum or value of $5, 000, 000, exclusive of interest and costs." 28 U.S.C. §1332 (d)(6). When a class action complaint expressly disclaims the ability to recover the $5 million jurisdictional amount, the Third Circuit instructs that the burden is on the defendant to prove "to a legal certainty that plaintiff can recover" that amount. See Frederico v. Home Depot, 507 F.3d 188, 197 (3d Cir. 2007) (citing Morgan v. Gay, 471 F.3d at 469, 474 (3d Cir. 2006)). The concept of legal certainty if not well defined, but falls somewhere below "absolute certainty" and above "preponderance of the evidence." See Stephenson v. Consol. Rail Corp., No. 13-cv-721 (RBK), 2013 WL 174005 at *2 (D.N.J. Apr. 23, 2013) (quoting, inter alia, Nelson v. Keefer, 451 F.2d 289, 293 n.6 (3d Cir. 1971)). A court examines both "the dollar figure offered by the plaintiff" and plaintiff's "actual legal claims" to determine whether "the amount in controversy exceeds the statutory threshold." See Morgan, 471 F.3d at 474-75.

III. DISCUSSION

A. Arguments

As stated above, the only issue currently before the Court is whether the $5 million threshold for CAFA jurisdiction is satisfied. Moreover, the only question to be addressed in this respect is whether Defendant is ...


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