In the
United States Court of Appeals
For the Seventh Circuit
No. 11-8001
ABM S ECURITY S ERVICES, INC.,
Petitioner,
v.
T YRONE D AVIS, et al.,
Respondents.
Petition for Permission to Appeal from
the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 10 C 5958—Milton I. Shadur, Judge.
S UBMITTED F EBRUARY 28, 2011—D ECIDED JUNE 16, 2011
Before B AUER, K ANNE, and S YKES, Circuit Judges.
S YKES, Circuit Judge. ABM Security Services, Inc., peti-
tions to appeal the district court’s remand of this case
to state court pursuant to the Class Action Fairness Act,
28 U.S.C. § 1453(c)(1) (“CAFA”). The plaintiffs, em-
ployees of ABM, filed their proposed class action in
Illinois state court, alleging that ABM violated the
Illinois Minimum Wage Law (“IMWL”) when it failed to
2 No. 11-8001
compensate employees for time spent working before
and after their shifts. ABM removed the case to federal
court asserting that the court had jurisdiction under
CAFA. The district court concluded that ABM failed to
show that the amount in controversy exceeds $5,000,000,
as required to establish CAFA jurisdiction. 28 U.S.C.
§ 1332(d)(2). The parties do not dispute that CAFA’s
other jurisdictional requirements are met. We grant
ABM’s petition for permission to appeal and reverse the
district court’s order remanding the case to state court.
ABM twice amended its notice of removal, each time
responding to instructions from the district court and
further refining its calculation of the amount in contro-
versy. Included in the amount in controversy are com-
pensatory damages for the three-year period immedi-
ately preceding the filing of the original complaint,
interest on all regular and overtime compensation due,
and costs and attorneys’ fees. The IMWL also provides
for a punitive-damages award. See 820 ILL. C OMP.
S TAT. 105/12(a) (providing for “damages of 2% of the
amount of any such underpayments for each month fol-
lowing the date of payment during which such under-
payments remain unpaid”).
In its initial notice of removal, ABM calculated
that the amount in controversy could be as high as
$10.7 million, exclusive of attorneys’ fees. ABM esti-
mated that hourly security guards spent approximately
thirty minutes per day performing the duties that are
the subject of plaintiffs’ allegations; this would result in
two-and-a-half hours of unpaid work per week for full-
No. 11-8001 3
time employees and thirty minutes for part-time em-
ployees. ABM multiplied the number of employees by
their average wage rate and the number of unpaid
hours for the relevant time period. This resulted in
$6.2 million in compensatory damages. Adding the 2%
penalty raised the amount in controversy to $10.7 mil-
lion. ABM noted that this figure did not include
any adjustment for overtime rates for any of the hours,
which could raise the amount by another $1.5 million.
At a hearing the district court instructed ABM to
exclude a subset of putative class members who had
opted into a related class action pending in California.
The court also requested additional information re-
lating to the number of weeks worked by members of
the putative class. ABM then filed an amended notice
of removal with revised calculations. If the unpaid wages
were straight time, ABM calculated, they would total
$3,014,812; if they were overtime, they would total
$4,552,218. Adding the 2% statutory penalty, ABM calcu-
lated the amount in controversy using straight wages as
$5,185,476.64, and using overtime wages as $7,778,214.96.
The district court again directed ABM to provide addi-
tional data regarding the precise number of days worked
by the putative class members and to exclude vacation
or sick days from the amount-in-controversy calcula-
tion. After review of its production records, ABM filed
another amended notice of removal and included a sum-
mary of the production records as an exhibit. ABM cal-
culated the number of holiday and nonholiday days
employees worked for each calendar year and deter-
4 No. 11-8001
mined the average holiday and nonholiday wage rate
for each year. ABM again estimated that plaintiffs were
alleging they were required to perform thirty minutes
of unpaid work each day. Using these figures, ABM
calculated that the potential back-pay damages
were $3,801,204.07. Adding a 2% statutory penalty of
$1,442,878.07, ABM calculated the total amount in con-
troversy as $5,244,082.14.
The district court disagreed and held that the amount
in controversy was approximately $5,500 short of the
$5 million jurisdictional requirement. It accepted the
calculation of relevant back-pay damages, but took
issue with the calculation of the 2% statutory penalty.
The district court thought ABM mistakenly doubled
the multiplier for each year’s damages and also failed
to properly apply the date when the statutory penalty
begins to accumulate. The court made an independent
calculation of the statutory penalty and held that it
was $1,193,244, making the total amount in controversy
$4,994,448.07. With regard to attorneys’ fees, the court
said that as of the date of removal, counsel for the puta-
tive class had “simply filed the Complaint, legal work
that did not push the total past the $5 million-plus
floor prescribed by CAFA.”
ABM argues that the district court erred when it calcu-
lated the statutory penalty and when it held that plain-
tiffs’ request for reasonable attorneys’ fees would not
push the amount in controversy over $5 million. In its
petition ABM attempts to recreate the district court’s
calculations and also shows its own calculations in the
No. 11-8001 5
form of several charts. ABM argues that the district court
erred when it calculated that no penalty accrued until
October 2007. The IMWL provides for “damages of 2% of
the amount of any such underpayments for each month
following the date of payment during which such under-
payments remain underpaid.” 820 ILL. C OMP. S TAT.
105/12(a). Plaintiffs filed their lawsuit on August 13, 2007.
ABM says that in accordance with the Illinois Wage
Payment and Collection Act, 820 ILL. C OMP. S TAT. 115/3,
it pays wages biweekly with one week in arrears; wages
that were due between August 13 and 17 were paid
on August 24, 2007. They argue that the “month
following the date of payment,” August 24, is Septem-
ber, so the penalty would start to accrue in September,
instead of October as the district court calculated. This
results in a penalty of $1,323,971.92, for a total amount
in controversy of $5,125,235.97. Alternatively ABM
argues that even if the penalty does not begin accruing
until September 24, one full month after the date of pay-
ment, it would still result in a penalty of $1,248,485.11
and an amount in controversy of $5,049,749.18.
In our recent decision in Back Doctors Ltd. v. Metropolitan
Property & Casualty Insurance Co., 637 F.3d 827, 830 (7th
Cir. 2011), we reiterated the legal standard to be used
when determining if the amount in controversy is met.
When removing a suit, the defendant as proponent of
federal jurisdiction is entitled to present its own
estimate of the stakes; it is not bound by the plain-
tiff’s estimate. . . . Once this has been done, and sup-
ported by proof of any contested jurisdictional facts,
6 No. 11-8001
the presumption is the one stated in St. Paul Mercury:
the estimate of the dispute’s stakes advanced by
the proponent of federal jurisdiction controls unless
a recovery that large is legally impossible.
Id. (citing St. Paul Mercury Indem. Co. v. Red Cab Co., 303
U.S. 283, 293 (1938)). And even more recently we em-
phasized that “[o]nce the proponent of federal jurisdic-
tion has explained plausibly how the stakes exceed
$5,000,000, the case belongs in federal court unless it
is legally impossible for the plaintiff to recover that
much.” Blomberg v. Serv. Corp. Int’l, 639 F.3d 761, 764
(7th Cir. 2011) (internal citation omitted).
ABM’s calculations regarding the accrual of the statu-
tory penalty are a reasonable interpretation of the
IMWL’s statutory language. In its remand order, the
district court gave two theories for why it thought
ABM’s calculations were wrong, though it acknowl-
edged that counsel had disputed any mistake at a recent
status hearing. The district court then asserted that
its independent calculations avoided the errors the
court attributed to ABM. But the court did not
show its own calculations in the order or explain how it
calculated the statutory penalty. Had ABM provided
the district court with the charts and comprehensive ex-
planation included in its petition, this appeal may
have been avoided. Even so, once ABM laid out its cal-
culations showing that the amount in controversy ex-
ceeded $5 million, the district court needed to find that
it was legally impossible for plaintiffs to recover that
much. See Back Doctors, 637 F.3d at 830. The district
No. 11-8001 7
court’s order does not establish that ABM’s calculations
regarding the plaintiffs’ potential recovery were legally
impossible.
The district court also failed to satisfactorily explain
why it was legally impossible for there to be at least
$5,552 in attorneys’ fees in controversy at the time of
removal. The district court correctly held that only attor-
neys’ fees incurred up to the time of removal could be
included in the amount in controversy. See Oshana v.
Coca-Cola Co., 472 F.3d 506, 512 (7th Cir. 2006). But the
court said that because plaintiffs’ counsel had “simply
filed the Complaint,” it did not push the amount in
controversy past the jurisdictional requirement. Attor-
neys’ fees are available for work performed prior to
filing a complaint, and it is quite plausible that the value
of preliminary legal work in a class-action lawsuit
exceeds $5,552.
For these reasons, we G RANT the petition for permis-
sion to appeal, R EVERSE the district court’s decision, and
R EMAND the case for further proceedings.
6-16-11