IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 99-40430
H & D TIRE AND AUTOMOTIVE-HARDWARE INC, ET AL,
Plaintiffs,
H & D TIRE AND AUTOMOTIVE-HARDWARE INC; BEARD PLUMBING CO;
JONES AND JONES, INC.,
Plaintiffs-Appellants,
versus
PITNEY BOWES INC, ET AL,
Defendants,
PITNEY BOWES INC; PITNEY BOWES CREDIT,
Defendants-Appellees.
Appeal from the United States District Court
for the Eastern District of Texas
April 30, 2001
ON PETITION FOR PANEL REHEARING
AND REHEARING EN BANC
(Opinion September 27, 2000, 5th Cir. 2000, ____F.3d____)
Before POLITZ, GIBSON,* and HIGGINBOTHAM, Circuit Judges.
PER CURIAM:
*
Circuit Judge of the Eighth Circuit, sitting by designation.
Pitney Bowes moved for panel rehearing and rehearing en banc,
following our decision to vacate this case for lack of
jurisdiction.1 We remain convinced that the federal courts have no
jurisdiction over this case.
It began in a Texas state court in February of 1995.
Plaintiffs, H&D Tire, Beard, and Jones & Jones, sued on behalf of
a class of persons allegedly the victims of certain unauthorized
charges Pitney Bowes made when plaintiffs traded up from one piece
of leased equipment to another.
In their state court petition, plaintiffs alleged that their
individual damages from the trade-up charges “would not exceed
$30,000.” They also alleged, following Texas practice, that their
damages exceeded “the minimum jurisdictional limits” of the state
court. The plaintiffs also requested punitive damages and
attorneys’ fees. Pitney Bowes removed the case to federal court in
August of 1995. In its removal petition, Pitney Bowes alleged
that: the amount in controversy would exceed $50,000 (then the
jurisdictional minimum for diversity jurisdiction), that
“[p]resumably plaintiffs will seek substantial punitive damages
based upon [Pitney Bowes’] asserted wealth,” and that punitive
damages could be aggregated across the class to satisfy the
jurisdictional amount.
1
See H&D Tire and Automotive Hardware, Inc. v. Pitney Bowes
Inc., 227 F.3d 326 (5th Cir. 2000).
2
Plaintiffs moved for remand and supported their motion with a
declaration stating that each plaintiff’s individual claim “does
not, never did and never will exceed the sum or value of $50,000,”
which calculation included “any claim for actual, exemplary or
other damages.” This reaffirmed their earlier binding responses to
discovery requests filed in state court, which denied that any
individual claim exceeded $50,000. The motion to remand was
referred to a magistrate, who determined that punitive damages
could be aggregated across a class for purposes of computing the
jurisdictional amount. He therefore found that the jurisdictional
amount was met. The district court adopted that recommendation and
denied the motion to remand.
In October of 1997 the district court denied class
certification. In its Findings of Fact, the district court found
that H&D Tire’s trade-up charge was $72, that Beard’s was $254, and
that Jones & Jones’s was $990. After fourteen months of
inactivity, the district court ultimately granted Pitney Bowes
summary judgment. Plaintiffs appealed. On appeal, we determined
that federal subject matter jurisdiction was lacking because
aggregation of punitive damages was improper, and absent
aggregation the amount in controversy was not met, either on
removal or when judgment was entered in federal court. We vacated
and remanded to the district court with instructions to remand to
state court for lack of jurisdiction.
3
We would not vacate if jurisdiction were present either at the
time of removal or at the time of judgment.2 In this case,
however, the amount in controversy requirement was not met at
either time.
Aggregation was the only basis for sustaining removal in the
face of the capped claims on behalf of individuals. Yet damages of
individual class members cannot be aggregated across a class. That
is the law of the Fifth Circuit, even as regards punitive damages.
The case relied on by Pitney Bowes, Allen v. R&H Oil & Gas Co.,3 is
not to the contrary. Allen was limited – by the panel that decided
it – to the unique circumstances of Mississippi law,4 and has no
application here. We cannot “interpret” Rule 23 of the Federal
Rules of Civil Procedure to alter the settled rule that distinct
claims cannot be aggregated to meet the amount in controversy
requirement. Nor have we been pointed to controlling law
establishing that, in claiming punitive damages, class members were
seeking “to enforce a single title or right in which they have a
2
See Caterpillar Inc. v. Lewis, 519 U.S. 61, 75-78 (1996).
3
63 F.3d 1326, 1329 (5th Cir. 1995).
4
See Allen v. R&H Oil & Gas Co., 70 F.3d 26 (5th Cir. 1995)
(per curiam) (“[T]he panel is of the unanimous view that the
opinion in this case specifically reflects a result under the
Mississippi law of punitive damages and is not to be construed as
a comment on any similar case that might arise under the law of any
other state.”).
4
common and undivided interest.”5 As Justice Black explains in
Snyder:
To overrule the aggregation doctrine at this late date
would run counter to the congressional purpose in
steadily increasing through the years the jurisdictional
amount requirement. . . . If there is a present need to
expand the jurisdiction . . . we cannot overlook the fact
that the Constitution specifically vests that power in
the Congress, not in the courts.6
Some may chafe under this fundamental brought forward by Justice
Black. It remains sound, however ambitious and immodest of
judicial powers one’s view might be.
No individual class member stated a claim approaching the
jurisdictional requirement, then $50,000. The three named
plaintiffs affirmatively documented their damages as $72, $254, and
$990 respectively, and the district court found those damages as a
fact. Pitney Bowes does not challenge these numbers. As we
explained, attorneys for the plaintiffs stated in a declaration
filed with the district court7 that the amount in controversy for
5
Snyder v. Harris, 394 U.S. 332, 335 (1969).
6
Id. at 339-42.
7
This declaration paralleled plaintiffs’ judicially binding
responses to interrogatories and requests for admission in state
court. As we have held, “[w]hen specifically contested in a motion
to remand, bare allegations by the removing party (much less
statements in passing) have been held insufficient to invest a
federal court with jurisdiction.” Asociacion Nacional de
Pescadores v. Dow Quimica, 988 F.2d 559, 566 (5th Cir. 1993)
(Garwood, J.). Even if plaintiffs’ state court pleadings left
jurisdiction ambiguous, a post-removal affidavit violates no
principle of St. Paul Mercury Indemnity Co. v. Red Cab Co., 303
U.S. 283 (1938). We make that plain in Dow Quimica, explaining
5
any individual plaintiff “does not, never did, and never will
exceed the sum or value of $50,000, exclusive of interest and
costs. This includes any claim for actual, exemplary or other
damages.” The plaintiffs further disclaimed any claim for attorney
fees on behalf of any individual class member, in favor of a common
fund rather than the Connecticut statute: As Pitney Bowes
described plaintiffs’ claim in its Brief in Support of Removal,
“[f]ees in a common fund case are extracted from the class damage
recovery, rather than obtained from the losing party.” Defendant’s
only answer to the disclaimer was that “prevailing plaintiffs have
the statutory means of shifting the costs of attorney fees to the
CUTPA defendant.” This is meritless. Defendant argued to the
district court that plaintiffs’ efforts to limit the amount claimed
on behalf of any class member were sufficiently ambiguous that
their pleadings should be ignored. As we explain, even if
plaintiffs’ pre-removal responses were ambiguous, the disclaimers
are clear and speak to the claim at the time of removal.8
that “under those circumstances, the court is still examining the
jurisdictional facts as of the time the case is removed, but the
court is considering information submitted after removal.” Dow
Quimica, 988 F.2d at 565.
8
In response to requests for admission in state court,
plaintiffs pleaded “Plaintiff denies that Plaintiff is seeking
attorney fees [on behalf of individual class members] in this
case.” They swore that “plaintiffs’ counsel will request the court
to award attorney fees to plaintiffs’ counsel pursuant to the
common fund doctrine.” Later, in support of the motion to remand,
plaintiffs’ counsel stated “under penalty of perjury on behalf of
each of the Plaintiffs, I hereby confirm and stipulate that the
Plaintiffs are not seeking attorneys’ fees in this case and that
6
The amount in controversy requirement was not satisfied at the
time of judgment for the same reason. Of course the amount in
controversy could only be satisfied if at least one of the named
plaintiffs claimed damages in excess of $50,000. Yet the
plaintiffs affirmatively disclaimed any such claim, and documented
their actual damages as less than $1,000 each.
Defendants point to sections of the plaintiffs’ complaint that
alleges damages that exceed “the minimum jurisdictional limits of
this court.”9 This ignores the fact that damages as claimed by the
class and damages claimed by individuals who were class members
were pleaded in separate parts of each of the amended complaints.
Specifically, the provisions of the complaint relied upon by
defendants claim damages on behalf of the individual plaintiffs
and the plaintiff class. These allegations will not support
Plaintiff’s counsel will request the Court to award attorneys’ fees
to Plaintiff’s counsel pursuant to the common fund doctrine.” We
remain persuaded that if attorneys fees for individual members were
claimed (contrary to the plaintiffs’ pleadings), to a legal
certainty attorneys fees approaching $50,000 for each of the claims
was not reasonable. We need not rest there given the explicit
sworn disclaimer of plaintiffs’ counsel, clarifying any ambiguity
in the state court pleadings.
9
In Asociacion Nacional de Pescadores, 988 F.2d at 564 n.4,
in rejecting a similar argument, we observed regarding state
pleadings in a remand case: “The statement in their petition that
‘[d]amages far exceed the minimum jurisdictional limits of this
court’ furnishes no basis for that inference. The minimum amount
in controversy for Texas district courts, although not entirely
clear following recent constitutional and statutory changes . . .
is certainly no more than $500 . . . . Moreover, the claims of all
plaintiffs are aggregated in determining whether this requirement
is met.” (citations omitted).
7
jurisdiction because, as we have explained, the claimed damages
cannot be aggregated across a class. In the separate section of
each of their amended complaints in which individual claims were
asserted, the plaintiffs alleged that “individual actual damages
would not exceed $30,000.” This pleading is not sufficient to
confer federal jurisdiction, and here these separate pleadings are
reinforced by the explicit disclaimer of any damages exceeding that
amount on behalf of any class member.10
It is ordered that the petition for rehearing is DENIED.
The court having been polled at the request of one of the
members of the court and a majority of the judges who are in
regular active service not having voted in favor (Fed. R. App. P.
and 5th Cir. R. 35), the Motion for Rehearing En Banc is DENIED.
10
See KVOS, Inc. v. Associated Press, 299 U.S. 269, 277 (1936)
(holding that a general averment that damages will exceed the
jurisdictional requirement is sufficient unless the complaint
contains other averments which “qualify or detract from it in such
measure that when all are considered together it cannot fairly be
said that jurisdiction appears on the face of the complaint”);
Charles Alan Wright, Law of Federal Courts 479 (5th ed. 1994)
(“[A]n allegation that the matter in controversy exceeds, exclusive
of interest and costs, the sum of $50,000 (or whatever other sum a
particular statute may require) is sufficient unless the other
allegations of the complaint show that less than that amount is
involved.”).
8