Complex Litigation: CAFA Appeals

Abstract

Commentary and analysis of the time in which to bring an appeal of a district court order either granting or denying the remand of a state class action to state court after removal under the Class Action Fairness Act of 2005 (CAFA). Congress enacted CAFA in 2005 to create new federal diversity jurisdiction especially for class actions. In order to gain access to federal court, the proponents of a class action must demonstrate diversity of citizenship between the class claimants and the defendants, that there are at least 100 members in the class, and that the amount in controversy exceeds $5 million. 28 U.S.C. § 1332(d). To satisfy these requirements, the proponents needs only to show minimal diversity among the parties, and may aggregate the claimants’ damages to reach the $5 million amount-in-controversy threshold. CAFA also created new removal jurisdiction for state class actions to federal court. 28 U.S.C. § 1453. As part of the CAFA statutory scheme, CAFA specifies that an appellate court may accept an appeal from an order of a district court granting or denying a remand to state court if the application is made to the appellate court not less than 7 days after the entry of the order. This article surveys decisions form the 5th, 9th, and 11th Circuits discussing this peculiar timing requirement, generally agreeing that the 7-day rule makes no sense as stated, and therefore choosing to ignore the rule as a legislative scrivener’s error.