Martin v. Franklin Capital Corp.

F I L E D
United States Court of Appeals
PUBLISH Tenth Circuit

MAY 29 2001
UNITED STATES COURT OF APPEALS
TENTH CIRCUIT PATRICK FISHER
Clerk

JUANA M. MARTIN; GERALD T.
MARTIN, individually and on behalf
of all persons similarly situated,

Plaintiffs-Appellants,

v.
No. 99-2131
FRANKLIN CAPITAL CORPORA-
TION, a Utah corporation;
CENTURY-NATIONAL
INSURANCE COMPANY, a
California corporation,

Defendants-Appellees.

Appeal from the United States District Court
for the District of New Mexico
(D.C. No. CIV-96-1480-LH)

Michael P. Malakoff, Malakoff Doyle & Finberg, P.C., Pittsburgh, Pennsylvania
(Richard N. Feferman, Albuquerque, New Mexico, with him on the briefs), for
Plaintiffs-Appellants.

Jan T. Chilton, Severson & Werson, San Francisco, California (Jay D. Hertz,
Sutin, Thayer & Browne, Albuquerque, New Mexico, with her on the brief) for
Defendants-Appellees.
Before SEYMOUR and MURPHY, Circuit Judges, and KANE, Senior District
Judge. *

SEYMOUR, Chief Judge.

*
Honorable John L. Kane, Jr., Senior District Court Judge, District of
Colorado, sitting by designation.

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 Gerald and Juana Martin appeal the district court’s order dismissing their

complaint with prejudice. We conclude that we have jurisdiction over this appeal,

and that the district court lacked subject matter jurisdiction. Accordingly, we

reverse and remand with directions to remand this action to state court.

I

The Martins originally brought this proceeding in New Mexico state court,

individually and on behalf of all persons similarly situated, seeking damages

under state statutory and common law for alleged illegalities with respect to

automotive financing and insurance contracts. The plaintiff class alleged

defendant Franklin Capital Corporation, which purchased their installment sales

contracts from car dealers, deliberately overcharged them for required insurance

coverage purchased through defendant Century National Insurance. Invoking

diversity of citizenship, Century removed the case to federal court with the

consent of Franklin. The Martins then filed a motion to remand to state court for

lack of subject matter jurisdiction, arguing their claims did not meet the $50,000

amount-in-controversy requirement for diversity jurisdiction. 1

1
This action was filed in state court on September 13, 1996. At that time,
28 U.S.C.§ 1332 required the amount in controversy to exceed $50,000. Although
Congress subsequently amended the statute to increase the jurisdictional amount
to $75,000, the amendment applies only to cases filed on or after January 17,
(continued...)

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 In orders entered the same day, the district court denied the Martins’

motion to remand, denied the Martins’ motion for class certification, and granted

Century’s motion to dismiss for failure to state a claim. This left the Martins with

an individual case against Franklin in the federal district court. The Martins

subsequently requested that the court certify the order denying remand for

immediate appeal under 28 U.S.C. § 1292(b), which the court denied. The district

court order denying the Martins’ motion to remand contains virtually no comment

or analysis supporting its decision. However, in its memorandum opinion and

order denying the Martins’ section 1292(b) motion, the court addressed the

amount-in-controversy requirement by stating “[i]t does not appear to a legal

certainty that [the Martins’] claims are for less than $50,000 and I conclude that

they are colorable for the purposes of conferring jurisdiction.” Aplt. App., doc.

13 at 3.

It thus appears that, in assessing the evidence, the court required the

Martins to prove to a legal certainty that their claims were below the

jurisdictional amount rather than placing the burden on defendants to show by a

preponderance of the evidence that the amount was met. The court also appears

to have attributed to the Martins all of the attorneys fees requested on behalf of

(...continued)
1

1997. See Federal Courts Improvement Act of 1996, § 205, Pub. L. No. 104-317,
110 Stat. 3847, 3850 (Oct. 19, 1996).

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the class. See id. at 6. The court held that any putative class members whose

claims did not satisfy the jurisdictional amount were irrelevant because they had

already been removed from the case by the court’s order refusing to certify the

class. Id.

The Martins reasserted their belief that the court lacked jurisdiction, and

they requested an order dismissing their complaint with prejudice so they could

immediately appeal the jurisdictional issue without expending further time and

money in federal court. Noting that the Martins’ dismissal request was motivated

by their desire to take an immediate appeal and that defendants had failed to file a

response, the district court granted a voluntary dismissal with prejudice.

On appeal, the Martins reassert their contention that the district court

lacked subject matter jurisdiction over this action and therefore should have

granted their motion to remand the case to state court. They contend that neither

the complaint nor the notice of removal establishes by a preponderance of the

evidence that the amount in controversy exceeds $50,000, and that the damages

found by the district court reflect more than the amount claimed in their

complaint. They also contend the court erred as a matter of law by failing to

require each putative class member to independently meet the jurisdictional

amount.

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 Defendants counter that the Martins waived their right to object to removal

by failing to seek a remand within thirty days, citing 28 U.S.C. § 1447(c). They

also maintain the Martins’ individual claims satisfied the jurisdictional amount.

Finally, they contend the class’ punitive damages could be aggregated and

attributed to each class member to meet the jurisdictional amount and, in any

event, any failure by putative class members to satisfy individually the

jurisdictional amount was cured by the court’s denial of class certification. We

address each argument in turn.

II

Appellate Jurisdiction

We first address whether we have appellate jurisdiction. We raised the

issue sua sponte, requesting the parties to address whether a voluntary dismissal

with prejudice under these circumstances constitutes a final, appealable order for

purposes of 28 U.S.C. § 1291. In assessing whether appellate jurisdiction exists

in these circumstances, our inquiry is twofold: is the order granting the voluntary

dismissal final; and is there a case or controversy in light of the fact that plaintiff

sought the dismissal. After considering authority from other circuits and the

purposes of the final order rule, we conclude that we have jurisdiction over this

appeal.

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 First, we are convinced the dismissal with prejudice here is a final order for

purposes of appeal. Nothing is left pending in the district court and, because the

dismissal is with prejudice, the Martins are precluded from filing another lawsuit.

The dismissal did not reserve the Martins’ right to return to district court to

litigate any remaining issues. If they lose on their appeal of the order denying

remand, the litigation is terminated entirely. We agree with those authorities

holding that a dismissal order is final under these circumstances. See, e.g.,

Woodard v. STP Corp., 170 F.3d 1043, 1044 (11th Cir. 1999) (voluntary dismissal

with prejudice final); John’s Insulation, Inc. v. L. Addison & Assoc., 156 F.3d

101, 107 (1st Cir. 1998) (“most circuits hold that voluntary dismissals, and

especially those with prejudice, are appealable final orders”); Concha v. London,

62 F.3d 1493, 1507 (9th Cir. 1995) (judgment final when it bars claims forever);

see also 15A C HARLES A. W RIGHT , A RTHUR R. M ILLER & E DWARD H. C OOPER ,

F EDERAL P RACTICE & P ROCEDURE § 3914.8 (2d ed. 1992), at 623 (approving rule

that holds judgment final when plaintiff who voluntarily dismisses abandons all

remaining issues).

Viewing such a judgment as final does not undermine the final judgment

rule by encouraging quasi-interlocutory appeals. “[I]f the plaintiff is unsuccessful

in challenging the district court’s action, then the dismissal operates as an

adjudication on the merits and the litigation is terminated.” Concha, 62 F.3d at

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1507. Judicial economy is furthered because when “the appellant voluntarily

dismisses his action with prejudice and loses on appeal, the district court is saved

the time and effort of conducting extended trial proceedings and there is in

addition no possibility of piecemeal appeals.” Id. at 1508 n.8.

We also conclude that, even though the Martins requested dismissal, the

appeal presents a case or controversy sufficient to support jurisdiction. Because

the Martins were convinced the district court lacked diversity jurisdiction, they

did not want to expend the resources necessary to proceed in federal court to a

judgment on the merits, only to have the case remanded to state court on appeal

for lack of jurisdiction. While such a dismissal may be technically voluntary, as a

practical matter the Martins did not acquiesce in the judgment but rather were

using dismissal to challenge the underlying ruling. When, as here, a plaintiff

believes a ruling is so prejudicial to his case he is willing to risk losing the right

to litigate completely in order to challenge it, a case or controversy exists and he

should be allowed to appeal. See John’s Insulation, 156 F.3d at 107 (voluntary

dismissal with prejudice proper course of action when interlocutory ruling so

prejudicial that proceeding in district court would waste resources).

Because the Martins appealed a final order in a case or controversy, we

have jurisdiction to address the appeal.

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 III

Diversity Jurisdiction

In their motion to remand, the Martins asserted a lack of federal diversity

jurisdiction on the ground their action does not meet the $50,000 amount-in-

controversy requirement imposed by 28 U.S.C. § 1332(a). We review de novo a

district court’s determination of the propriety of removal. See Huffman v. Saul

Holdings Ltd. P’ship, 194 F.3d 1072, 1076 (10th Cir. 1999). In assessing the

district court’s ruling, we bear in mind that “[t]he courts must rigorously enforce

Congress’ intent to restrict federal jurisdiction in controversies between citizens

of different states,” Miera v. Dairyland Ins. Co., 143 F.3d 1337, 1339 (10th Cir.

1998), and that the presumption is therefore “against removal jurisdiction,”

Laughlin v. Kmart Corp., 50 F.3d 871, 873 (10th Cir. 1995).

A. The Burden of Establishing the Amount in Controversy.

When a case is originally brought in federal court, the plaintiff’s claimed

amount is presumed to support diversity jurisdiction. See St. Paul Mercury

Indem. Co. v. Red Cab Co., 303 U.S. 283, 288-89 (1938). The same is not true,

however, when the case has been removed from state court.

In a removed case, unlike a case instituted in federal court, the
plaintiff chose a state rather than federal forum. Because the
plaintiff instituted the case in state court, “[t]here is a strong
presumption that the plaintiff has not claimed a large amount in order
to confer jurisdiction on a federal court or that the parties have
colluded to that end.”

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Singer v. State Farm Mut. Auto. Ins. Co., 116 F.3d 373, 375 (9th Cir. 1997)

(quoting St. Paul Mercury, 303 U.S. at 290); see also Miera, 143 F.3d at 1340.

Thus in a removed case, “[t]he defendant’s claim that the amount in controversy

exceeds $50,000 does not enjoy the St. Paul Mercury presumption of accuracy

that the plaintiff’s does.” Singer, 116 F.3d at 376.

Defendant’s right to remove and plaintiff’s right to choose his forum
are not on equal footing; for example, unlike the rules applied when
a plaintiff has filed suit in federal court with a claim that, on its face,
satisfies the jurisdictional amount, removal statutes are construed
narrowly; where plaintiff and defendant clash about jurisdiction,
uncertainties are resolved in favor of remand.

Burns v. Windsor Ins. Co., 31 F.3d 1092, 1095 (11th Cir. 1994).

As the parties invoking the federal court’s jurisdiction in this case,

defendants bear the burden of establishing that the requirements for the exercise

of diversity jurisdiction are present. See Huffman, 194 F.3d at 1079. We have

held that “[t]he amount in controversy is ordinarily determined by the allegations

of the complaint, or, where they are not dispositive, by the allegations in the

notice of removal.” Laughlin, 50 F.3d at 873. In this case, the complaint itself

does not specify the amount of damages requested. Indeed, defendants in their

notice of removal observe that “[t]he amount in controversy, exclusive of interest

and costs, cannot be determined from the face of the complaint.” Aplt. App., doc.

4 at 2. When, as here, the plaintiff’s damages are unspecified, courts generally

require that a defendant establish the jurisdictional amount by a preponderance of

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the evidence. See, e.g., St. Paul Reinsurance Co. v. Greenberg, 134 F.3d 1250,

1253 (5th Cir. 1998); Singer, 116 F.3d at 376; United Food & Commercial

Workers Union, Local 919 v. CenterMark Prop. Meridan Square, Inc., 30 F.3d

298, 305 (2d Cir. 1994); Gafford v. General Elec. Co., 997 F.2d 150, 158 (6th

Cir. 1993); Varella v. Wal-Mart Stores, East, Inc., 86 F. Supp.2d 1109, 1111 (D.

N.M. 2000); see also McNutt v. General Motors Acceptance Corp., 298 U.S. 178,

189 (1936) (party asserting jurisdiction must prove jurisdictional prerequisites by

a preponderance of evidence). 2

Although this court has not expressly adopted the preponderance standard

in these circumstances, we have stated that the requisite amount in controversy

“must be affirmatively established on the face of either the petition or the removal

notice.” Laughlin, 50 F.3d at 873 (emphasis added). The italicized language

requires at a minimum that the jurisdictional amount be shown by a

preponderance of the evidence. Because, as we discuss below, we conclude that

defendants have failed to meet this burden, we need not decide whether a more

stringent one should be applied.

2
A few courts have placed greater or lesser burdens on defendants
asserting removal jurisdiction based on diversity. See generally 14C C HARLES A.
W RIGHT , A RTHUR R. M ILLER & E DWARD H. C OOPER , F EDERAL P RACTICE &
P ROCEDURE § 3275 (3d ed. 1998), at 89-95 (discussing standards).

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 B. Determination of Amount in Controversy

We turn to a de novo review of the district court’s conclusion that diversity

jurisdiction is present here. 3 The complaint does not in any of its counts request a

specific dollar amount. Nonetheless, the district court adopted defendants’

construction of the Martins’ pleading and concluded that the complaint itself

established the requisite amount in controversy. 4 We have carefully reviewed the

3
We give short shrift to defendants’ argument that the Martins waived
federal diversity jurisdiction by failing to challenge the amount in controversy
within thirty days. The governing statute expressly provides to the contrary: “If at
any time before final judgment it appears that the district court lacks subject
matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). As the
Supreme Court has noted:

section [1447(c)] differentiates between removals that are
defective because of lack of subject-matter jurisdiction and
removals that are defective for some other reason . . . . For the
latter kind of case, there must be a motion to remand filed no
later than 30 days after the filing of the removal notice. For
the former kind of case, remand may take place without such
a motion and at any time.

Wisconsin Dep’t of Corr. v. Schacht, 524 U.S. 381, 392 (1998) (citations
omitted). In Laughlin v. Kmart Corp., 50 F.3d 871 (10th Cir. 1995), for example,
we raised the issue of diversity jurisdiction on appeal and concluded it was
lacking, even though the plaintiff “neither objected to removal nor questioned the
amount in controversy.” Id.
4
We have held that a defendant’s economic analysis of the plaintiff’s
claims for damages, “prepared after the motion for removal and purporting to
demonstrate the jurisdictional minimum, does not establish the existence of
jurisdiction at the time the motion was made. . . . [T]he requisite amount in
controversy . . . must be affirmatively established on the face of either the petition
or the removal notice.” Laughlin, 50 F.3d at 873. At the hearing below, the
(continued...)

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complaint and we agree with the Martins that it does not demonstrate by a

preponderance of the evidence claims in excess of $50,000. For example, it

appears defendants simply viewed every dollar amount mentioned in the

complaint as an item of damages claimed by the Martins without regard to

allegations making clear the Martins were not in fact seeking all those amounts. 5

In addition, while the Martins did seek treble damages under one state statute,

defendants have failed to establish what specific damages were recoverable under

that statute and instead merely assumed that all amounts mentioned in the

complaint were subject to trebling.

4
(...continued)
district court recited and adopted the amounts set out by defendants’ briefs in
support of jurisdiction. See Aplt. App., doc. 20 at 46. The record on appeal does
not include these briefs and it is arguable, given our holding in Laughlin, that
they should not have been considered by the district court. We need not decide
whether the court erred in this regard, however, in view of our conclusion that the
Martins’ complaint does not support the construction defendants placed upon it in
those briefs.
5
Defendants apparently included in their calculation finance charges of
over $8000 and insurance premiums of over $7000 despite allegations in the
complaint that because the Martins defaulted on their installment contract, they
made only a few payments on the finance charges and no payments on the
insurance premiums, and sought to recover only the charges they actually paid.
Defendants included two repossession charges as items of damages although the
Martins did not allege that the first of these, in the amount of $420, was illegal.
Defendants likewise included a down payment of almost $4000 which the Martins
were not attempting to recover. On appeal, defendants also argue that the entire
amount of the sales contract is to be included, notwithstanding that the Martins,
while seeking rescission of the contract, sought as damages only the amounts they
had actually paid under it.

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 Because we conclude that the amount-in-controversy requirement is not

satisfied on the face of the complaint, we turn to the notice of removal. As

mentioned above, defendants conceded in their removal notice that the amount in

controversy could not be determined from the face of the complaint. Aplt. App.,

doc. 4 at 2. In contending that the requisite amount was nonetheless satisfied,

defendants began by summarizing the allegations and the requested relief asserted

by the Martins. This mere summary, of course, does not provide the requisite

facts lacking in the complaint. Defendants also asserted that jurisdiction was

satisfied because the attorneys fees and the punitive damages claimed by the

entire class could be aggregated and attributed to the Martins in determining the

amount in controversy, and that so long as the Martins as class representatives

met the jurisdictional amount, the other class members fell within the court’s

supplemental jurisdiction regardless of the value of their claims. As we discuss

below, none of these assertions supports the existence of diversity jurisdiction.

1. Aggregation of Punitive Damages

We turn first to defendants’ contention, both in their removal notice and on

appeal, that the punitive damage claims of the putative class members may be

aggregated and attributed to the Martins and to each class member, and that these

aggregated damages satisfy the jurisdictional amount with respect to each member

of the putative class. In support of this argument, defendants rely on the cases of

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Tapscott v. MS Dealer Serv. Corp., 77 F.3d 1353 (11th Cir. 1996), and Allen v. R

& H Oil & Gas Co., 63 F.3d 1326 (5th Cir. 1995), both of which have been

disapproved by the circuits that decided them. See Cohen v. Office Depot, Inc.,

204 F.3d 1069, 1073-77 (11th Cir. 2000) (explaining Tapscott not valid precedent

because it conflicts with earlier ruling on same issue); Ard v. Transcont’l Pipe

Line Corp., 138 F.3d 596, 601-02 (5th Cir. 1998) (Allen decision due to

peculiarity of Mississippi law and does not represent precedent for any other

state). Indeed, all of the circuits considering the issue now hold that punitive

damages cannot be aggregated and attributed in total to each member of a putative

class for purposes of satisfying the amount-in-controversy requirement of

diversity jurisdiction. See, e.g., Morrison v. Allstate Indem. Co., 228 F.3d 1255,

1264-65 (11th Cir. 2000); Ard, 138 F.3d at 600-02; Gilman v. BHC Securities,

Inc., 104 F.3d 1418, 1430-31 (2d Cir. 1997); see also Anthony v. Security Pac.

Fin. Servs., Inc., 75 F.3d 311, 315 (7th Cir. 1996) (implicitly rejecting

aggregation of punitive damages by concluding that “[t]he plaintiffs in this case

would have to recover on average at least $47,118.36 in punitive damages to

satisfy 28 U.S.C. § 1332”).

Although this court has not ruled directly on the matter, we have pointed

out that the Supreme Court has historically interpreted section 1332 “to require

plaintiffs who have separate and distinct claims, but unite together in a single

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suit, to each meet the jurisdictional amount in controversy.” Leonhardt v.

Western Sugar Co., 160 F.3d 631, 637(10th Cir. 1998). We observed that the

Court has therefore only permitted aggregation when “a single plaintiff seeks to

aggregate . . . his own claims,” or when “two or more plaintiffs unite to enforce a

single title or right in which they have a common and undivided interest.” Id. As

we discuss below, we now hold, in light of the language in Leonhardt and the

analysis of our sister circuits, that punitive damages may not ordinarily be

aggregated and attributed in total to each member of a putative class for purposes

of satisfying diversity jurisdiction.

The court in Gilman explained the reasoning supporting this conclusion.

As one court expressed the principle, the “paradigm cases”
allowing aggregation of claims “are those which involve a single
indivisible res, such as an estate, a piece of property (the classic
example), or an insurance policy. These are matters that cannot be
adjudicated without implicating the rights of everyone involved with
the res.”

Gilman, 104 F.3d at 1423 (quoting Bishop v. General Motors Corp., 925 F. Supp.

294, 298 (D. N.J. 1996)). The court pointed out that even though a class claim

for punitive damages may create a single pool of recovery, “a common interest in

a pool of funds is not the type of interest that permits aggregation of claims under

the ‘common fund’ doctrine.” Id. at 1430. Each class member could sue

separately for punitive damages and have his right to recovery determined without

implicating the rights of every other person claiming such damages. Id. Because

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a class member’s right to punitive damages is separate, distinct, and independent

from those of other class members, the class claim for such damages does not

seek to enforce a single right in which the class has a common and undivided

interest. Punitive damages therefore may not be aggregated in a class action and

attributed in total to each member of the class. We agree with Gilman and the

other courts, and we reject defendants’ argument that the jurisdictional amount

with respect to the Martins is satisfied on the basis of the aggregated claims of the

class members to punitive damages.

2. Aggregation of Attorney Fees

In their removal notice, defendants also assert that “[t]he attorney fees of

the entire class are attributable to the named plaintiffs for purposes of satisfying

the jurisdictional amount.” Aplt. App., doc 4 at 3. Although defendants do not

present this argument directly on appeal, they contend that all of the fees

requested by the Martins should be considered in determining whether their

claims satisfy the amount in controversy, in effect attributing all the fees that will

potentially be recovered in this putative class action to the class representatives.

Courts have generally held, under the same rationale applied to preclude the

aggregation of puntive damages, that attorneys fees cannot be aggregated for

purposes of diversity jurisdiction. See, e.g., Morrison, 228 F.3d at 1266-68 (when

each class member could recover attorneys fees if he sued separately, right to

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recover fees was separate and distinct and could not be aggregated); see also

Goldberg v. CPC Int’l, Inc., 678 F.2d 1365, 1367 (9th Cir. 1982) (aggregation of

attorneys fees would conflict with Supreme Court authority requiring plaintiffs

with separate and distinct claims to each meet jurisdictional amount). 6 We agree

and conclude that potential attorneys fees requested on behalf of the class may not

be aggregated and attributed entirely to the Martins in assessing whether they

meet the amount in controversy. 7

In view of our conclusions that neither the face of the complaint nor the

removal notice demonstrate that the Martins’ claims will exceed $50,000, and that

neither the punitive damages nor the attorneys fees sought by the class can be

attributed entirely to the Martins as class representatives, we hold defendants

have failed to show by a preponderance of the evidence that the Martins’ claims

6
In their removal notice, defendants cited In re Abbott Laboratories, 51
F.3d 524 (5th Cir. 1995), as support for their contention that attorneys fees can be
aggregated. As the Fifth Circuit has observed, however, the holding in Abbott
Laboratories is peculiar to a Louisiana statute and “[t]he standard approach to
awards of attorney’s fees in a class action context is to distribute them pro rata to
all class members, both named and unnamed.” Coghlan v. Wellcraft Marine
Corp., 240 F.3d 449, 455 n.5 (5th Cir. 2001).
7
The result might be different if the state statute under which fees are
sought expressly awards those fees solely to the class representatives. See, e.g., H
& D Tire & Automotive-Hardware, Inc. v. Pitney Bowes, Inc., 227 F.3d 326, 330-
31 (5th Cir. 2000). Defendants have made no showing that the statutes at issue in
this case do so.

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meet the amount in controversy necessary to the exercise of diversity

jurisdiction. 8

Because the Martins’ claims do not meet the jurisdictional amount, the

disposition of the class claims by the district court is irrelevant. Although we

therefore need not address the remaining arguments with respect to the class, we

make the following observations. This court has specifically rejected defendants’

contention that so long as the class representatives meet the jurisdictional amount,

all class members fall within the court’s supplemental jurisdiction. See

Leonhardt, 160 F.3d at 638-41 (rejecting argument that “the enactment of 28

U.S.C. § 1367, concerning supplemental jurisdiction, altered the historical

aggregation rules under § 1332 for class actions,” and concluding enactment of §

8
We reject the argument based on Caterpillar, Inc. v. Lewis, 519 U.S. 61
(1996), that diversity jurisdiction exists nonetheless because the district court
refused to certify the class and the resulting deletion of the putative class
members cured any jurisdictional defect their presence might earlier have created.
Although the Supreme Court held in Caterpillar that “a district court’s error in
failing to remand a case improperly removed is not fatal to the ensuing
adjudication if federal jurisdictional requirements are met at the time judgment is
entered,” id. at 64, the Court also observed that “if, at the end of the day and case,
a jurisdictional defect remains uncured, the judgment must be vacated,” id. at 76-
77 (italics deleted). Because defendants failed to establish that diversity
jurisdiction is present with respect to the Martins, the jurisdictional defect
remained at the time of judgment. See Gilman, 104 F.3d at 1421 (when removing
defendant fails to establish subject matter jurisdiction by the time judgment is
entered, judgment must be vacated and remanded with instructions to remand to
state court).

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1367 did not overrule preexisting authority holding “each plaintiff in a diversity-

based class action must meet the jurisdictional amount in controversy under §

1332”). 9 In any event, because the class representatives here do not meet the

jurisdictional amount, supplemental jurisdiction over class members would not be

available. 10

In sum, we hold that we have appellate jurisdiction over this final,

appealable order. Defendants have failed to establish the requisite amount in

controversy, and the district court therefore lacked subject matter jurisdiction.

9
In Abbott Laboratories, 51 F.3d 524, the Fifth Circuit reached a result
directly contrary to our holding in Leonhardt. The Supreme Court granted
certiorari in Abbott Laboratories to address whether the supplemental jurisdiction
statute, 28 U.S.C. § 1367, overruled the authority upon which this court relied in
Leonhardt, see Free v. Abbott Labs., Inc., 528 U.S. 1018 (2000), and affirmed the
Fifth Circuit’s decision by an equally divided Court, see Free v. Abbott Labs.,
Inc., 529 U.S. 333 (2000) (per curiam). An unexplained affirmance by an equally
divided court is not entitled to any precedential weight. See Rutledge v. United
States, 517 U.S. 292, 304 (1996). Leonhardt accordingly remains controlling law
in this circuit.
10
The only allegations in the complaint relevant to the putative class
members are assertions that their individual damages “are too small in number to
justify the expense and effort required to bring suit separately,” Aplt. App., doc. 2
at 14, and that the “Martins claims are not only typical but identical to the claims
of the members of the Class,” id. at 16. These allegations do not establish
individual claims in excess of $50,000, particularly given our holding that neither
attorneys fees nor punitive damages may be aggregated and attributed in total to
each class member. Accordingly, we conclude that defendants have failed to
establish the amount in controversy with respect to any of the putative class
members.

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Accordingly, we REVERSE the judgment of the district court and REMAND

with directions to remand this action to state court.

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