Carvalho v. Credit Consulting Services, Inc. et al

Reply to Opposition To 12 Motion to Remand

N.D. Cal.May 30, 2008

- 1 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 THOMAS P. QUINN, JR., SBN : 132268 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 Tel: (949) 376-3055 Fax: (949) 376-3070 Email: tquinn@nokesquinn.com Attorneys for Defendants EQUIFAX INFORMATION SERVICES LLC UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION NOEMIA CARVALHO, on behalf of herself and other similarly situated people, Plaintiff, v. CREDIT CONSULTING SERVICES, INC., dba CCS, EQUIFAX CREDIT INFORMATION SERVICES, LLC, EXPERIAN INFORMATION SOLUTIONS, INC., TRANS UNION LLC and DOES 1-50, inclusive, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) Case No. 5:08-CV-01317-JF RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND Hearing: June 20, 2008 Time: 9:00 a.m. Judge: Jeremy Fogel Courtroom 3, 5th Floor Place: San Jose COMES NOW Defendant Equifax Information Services LLC (“Equifax”), incorrectly sued herein as “Equifax Credit Information Services LLC,” and submits its response in opposition to Plaintiff’s Motion to Remand. As discussed below, the motion should be denied. INTRODUCTION On March 7, 2008, Equifax removed this case to this Court pursuant to the Class Action Fairness Act of 2005 (“CAFA”). Plaintiff now moves the Court to remand on the grounds that the matter in controversy does not exceed $5 million as required by CAFA. Plaintiff claims no other deficiency in the removal. As Equifax stated in its Notice of Removal, and again herein, Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 1 of 11 - 2 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 Plaintiff’s recent deposition testimony proves the amount in controversy. She testified that her damages, and the damages of each class member, may exceed $25,000 each. She alleges that there are two classes of at least 500 potential class members each. It is without question, based on simple math, that the amount in controversy exceeds $5 million. STATEMENT OF FACTS A. Plaintiff’s Complaint On July 24, 2006, Plaintiff filed this case as a proposed class action in the Superior Court of California, Monterey County. See Exhibit A to Notice of Removal. The Complaint alleges that Equifax and the co-defendant consumer reporting agencies, Trans Union LLC and Experian Information Solutions Inc., violated the California Consumer Credit Reporting Act (“CCCRA”), California Civil Code sections 1785.1, et. seq. by reporting an inaccurate medical debt and failing to remove it upon her dispute. See Complaint, ¶¶ 1, 7-9. Ms. Carvalho asserts that class action treatment is appropriate for her claims and seeks to represent all California consumers for whom the CRAs failed to properly reinvestigate a dispute and failed to allow for review and consideration of all relevant information provided by the consumers. Id., ¶ 13. A second alleged class is defined as all consumers who did not receive a description of the reinvestigation procedures. Id., ¶ 14. Plaintiff contends that membership in each class exceeds 500 people. Id., ¶ 18A. Plaintiff contends that all members of the purported class have suffered injury, or are threatened with injury. Id., ¶ 18C. She alleges that she will incur fees and costs in prosecuting the case. Id., ¶ 19. She seeks damages, punitive damages, attorney’s fees and costs on behalf of herself and members of the class. Id., ¶¶ 22, Prayer for Relief. Plaintiff indicated on the Civil Case Cover Sheet that it is an “unlimited” case, indicating that the amount demanded exceeds $25,000. The Complaint contains no ad damnum clause. The Complaint states no specific amount of damages sought by either Plaintiff or the putative class members whose interests she purports to represent. To date, Plaintiff has refused to provide a statement of her alleged damages. Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 2 of 11 - 3 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 Indeed, Plaintiff does not even state in her Motion that her claims are limited to an amount under $5 million and she does not state the amount of damages she seeks for the putative class. B. Plaintiff’s Deposition Equifax and the co-defendants deposed Plaintiff on February 6, 2008 and March 4, 2008. Prior to those depositions, Plaintiff had not provided the defendants with any testimony or information regarding damages for the putative class. At the deposition, Ms. Carvalho explained that she incurred economic damages when she was unable to refinance a mortgage. Deposition of Noemia Carvalho, Volume II, 264:7-22 (relevant portions attached hereto as Exhibit A). She does not know specifically how much monetary damage Equifax allegedly caused her. Id., 264:7-266:12. Q. How much have you been damaged in your pocketbook because of Equifax? A. I could not refinance my --my biggest damage is my refinance for my mortgage? Q. Have you calculated how much damage that was in your refinance? A. No, I did not calculate yet. Id., 264:9-13. Yet, she wrote to Equifax (and each of the other consumer reporting agency defendants) before she filed her lawsuit and demanded $25,000 plus her attorneys fees, each to resolve her individual claim. Id., 242:23-243:16; 330:16-333:16; 334: 20-336:2. Q. So at the time in February of 2006, this letter shows that your damages were $25,000 plus your attorney’s fees? (Objection excised) A. Yes, correct. Id., 335:18-336:2. Plaintiff testified that members of the purported class may have damages that were more than hers and some may have made demands to Equifax in excess of $25,000 to cover their alleged damages. Id., 333:17-334:14; 336:5-21; 340:24-341:9. Q. Any of these people that are similarly situated to you, do you know if they made demands to Equifax for settlement? A. I don't know. Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 3 of 11 - 4 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 Q. Do you know what their damages are? A. I don't know. Q. Their damages could be more than yours; right? A. I don't know. Every case is a case; right? Q. I'm asking about the people that are similarly situated to you. A. Every case is different than each other. Q. Okay. So some of their damages might be more than yours; right? A. Could be. Q. Some of them could be less; right? A. Right. Q. Some of them could have made a $25,000 demand; right? A. Yes. Q. Some of them could have made a -- A. Nothing. Q. -- higher demand for settlement; right? A. Yes. Id., 333:17-334:14. Q. Going back to the similarly situated question, again, in February 2006, you don't know if anyone that was similarly situated had more than $25,000 in damages? A. No. Q. They could though; right? A. I don't know. I don't know who. Q. You don't know who, but they could, these people have more than $25,000 in damages; right? (Objection excised) A. Yes. Q. And they could have more attorney's fees than you did too; right? A. Yes, logically. Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 4 of 11 - 5 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 Id., 336:5-19. Plaintiff testified that “$25,000 would not be enough” to resolve her damages or the damages to each the persons in the purported class. Id., 337:17-340:22. Q. Would you agree to take $25,000 from Equifax now to resolve this case? A. No. (Objection excised) Q. Would you take $50,000 from Equifax? A. No. *** Q. How about on behalf of the persons whom you purport to represent? Would you take $25,000 on each of those persons that you claim is similarly situated? (Objection excised) A: No. Q. Is that not enough? A. No. I'm not prepared to talk about money. This is not what I'm here for. Q. I just want to make sure the record is clear. Even $25,000 apiece would not be enough -- Even $25,000 apiece would not be enough for you to settle -- to resolve the damages on behalf of the persons that are similarly situated? (Objection excised) A. That's correct. Q. Do you know anything about the persons that are similarly situated with regard to their damages? A. No, I don't know anything. (Objection excised) Q. Again, their damages could be a lot more than yours, right? (Objection excised) A. That's correct. Id., 338:24-339:5; 340:2-341: 9. Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 5 of 11 - 6 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 ARGUMENT AND CITATION TO AUTHORITY I. THE REMOVAL OF THIS ACTION WAS PROPER UNDER CAFA. To satisfy the requirements for original jurisdiction under CAFA, the removing defendant must establish that the case: (1) meets CAFA’s definition of "class action"; (2) contains 100 or more members in the putative class; (3) satisfies the requirement for minimal diversity; and (4) has an amount in controversy exceeding the sum or value of $5,000,000 in the aggregate, exclusive of interest and costs. See 28 U.S.C. § 1332(d). Plaintiff does not dispute that Equifax has satisfied the numerosity or minimal diversity requirements. Nor does she contend that any of the exceptions to jurisdiction under CAFA apply. The only issue for the Court is whether there is $5 million in controversy. Plainly, Plaintiff’s testimony and Complaint allegations establish the requisite amount in controversy. A. It Is More Likely Than Not That The Amount In Controversy Exceeds $5 Million. Plaintiff’s Complaint did not plead a specific amount of damages. As such, Equifax’s burden must simply prove “by a preponderance of the evidence” that the amount in controversy exceeds the jurisdictional minimum. Abrego Abrego v. Dow Chemical Co., 443 F. 3d 676, 683 (9th Cir. 2006) (per curiam); Sanchez v. Monumental Life Ins. Co., 102 F. 3d 398, 404 (9th Cir. 1996). The preponderance standard is said not to be “daunting,” as courts recognize that the removing defendant is not obligated to research, state, and prove the plaintiff’s claims for damages. Korn v. Polo Ralph Lauren Corp., 536 F. Supp. 2d 1199, 1204-1205 (E.D. Cal. 2008). In Abrego Abrego, the Ninth Circuit held that a court may consider facts in the removal petition and “summary-judgment-type” evidence relevant to the amount in controversy at the time of removal. 443 F. 3d at 690 (quoting Singer v. State Farm Mutual Ins. Co, 116 F.3d 373, 376 (9th Cir. 1997)). Plaintiff’s deposition testimony plainly establishes the $5 million CAFA threshold. She first testified that she would not settle her individual case with Equifax for $25,000 or even Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 6 of 11 - 7 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 $50,000. Carvalho Dep. II, 338:24-339:5. She then testified that she would not accept $25,000 for each of the putative class members: Q. How about on behalf of the persons whom you purport to represent? Would you take $25,000 on each of those persons that you claim is similarly situated? (Objection excised) A. No. *** Q. Even $25,000 a piece would not be enough for you to settle -- to resolve the damages on behalf of the persons that are similarly situated? (Objection excised) A. That’s correct. Id., 340:2-22. The math is straightforward based on Plaintiff’s testimony and her Complaint. First, Plaintiff’s testimony that she would not resolve the claims of the putative class member for $25,000 each puts $25,000 in controversy for each putative class member. Second, her Complaint proposed two classes “in excess of 500” members each. Complaint, ¶ 184. Therefore, the amount in controversy based on Plaintiff’s allegations and sworn testimony is $25,000,000, or the product of $25,000 and at least 1,000 putative class members. Even if the two proposed classes completely overlapped with one another such that there were only 500 putative class members, the minimum amount in controversy would still be $12,500,000, which is well beyond the $5,000,000 threshold. Courts in this Circuit consistently deny remand motions where the defendant satisfies the relatively light preponderance standard in demonstrating the minimum amount in controversy under CAFA. See, e.g., Helm v. Alderwoods Group, Inc., 2006 WL 2002511 (N.D. Cal. May 7, 2008); Bryant v. Service Corp. Int’l, 2008 WL 2002515 (N.D. Cal. May 7, 2008); Saulic v. Symantec Corp., 2007 WL 5074883 (C.D. Cal. Dec. 26, 2007). There can be little debate here that it is more likely than not that the amount in controversy exceeds $5,000,000. // Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 7 of 11 - 8 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 B. There Is No Requirement That Plaintiff’s Individual Claims Exceed $75,000 Plaintiff claims that Equifax is required to prove that Plaintiff’s individual claim meets the $75,000 threshold under 28 USC § 1332(a). Motion to Remand at 3. Plaintiff is incorrect. Plaintiff’s argument is based on a complete misreading of Abrego Abrego and the context in which that case arose. While that case was removed under CAFA, it was not a proposed “class action” as defined by CAFA, but instead was a proposed “mass action” under the statute. Abrego Abrego, 443 F.3d at 677; See also 28 U.S.C. §1332(d)(11)(B). A “mass action” under CAFA requires each plaintiff to satisfy the $75,000 amount in controversy threshold. See 28 U.S.C. §1332(d)(11)(B)(i). That requirement is not imposed on “class actions” under CAFA. See Nelson v. BIC USA, Inc., 2008 WL 906049 at n-2 (S.D. Cal. Apr. 1, 2008) (explaining this distinction and denying remand motion). Here, Plaintiff’s case is a proposed “class action” under CAFA. As such, there is no requirement that the claims of Plaintiff or any putative class member exceed $75,000. Plaintiff’s arguments otherwise should be rejected. II. EQUIFAX’S NOTICE OF REMOVAL WAS TIMELY. Equifax’s removal is timely because the amount in controversy was not asserted until Plaintiff testified in her depositions on February 6, 2008 and March 4, 2008 that her claims and the claims of each putative class member exceeded $25,000. Plaintiff’s Complaint did not assert an amount of damages and thus the amount of controversy was not established by the filing, meaning that “the case stated by the initial pleading [was] not removable.” 28 U.S.C. § 1446(b). Plaintiff did not previously provide any evidence in earlier discovery to support removal grounds. A notice of removal is timely if it is “filed within thirty days after receipt by the defendant, through service or otherwise, of a copy of an amended pleading, motion, or other paper from which it may be first ascertained that the case is one which is or has become removable.” Id.; see also Durham v. Lockheed Martin Corp., 445 F.3d 1247, 1251-54 (9th Cir. 2006) (removal within 30 days of plaintiff’s responses to interrogatories, which disclosed basis for removal for first time, was timely); Riggs v. Continental Baking Co., 678 F. Supp. 236, 238 (N.D. Cal. 1988) (“Defendants did not receive notice under Section 1446(b) of the facts indicating removability Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 8 of 11 - 9 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 until plaintiff was deposed on September 30, 1987. The deposition constituted an ‘other paper’ under the [removal] statute.”). As in Riggs, Plaintiff’s deposition testimony constituted “other paper.” Further, the Ninth Circuit in Abrego Abrego and Durham announced states a general rule that premature removal should be discouraged. The Court in Abrego Abrego cautioned against premature removal of actions based on CAFA. CAFA makes federal jurisdiction dependent on the nature of the claims and plaintiffs, which may only become clear following a detailed factual inquiry. Abrego Abrego 443 F. 3d at 691-92. Likewise, in Durham, the Court that a defendant removing prematurely “may well have subjected itself to fees and costs, and potentially Rule 11 sanctions, for filing a baseless removal.” 445 F. 3d at 1251 (reversing remand). Put simply, Equifax did not remove the case under CAFA earlier because the amount in controversy was not apparent on the face of the Complaint and it was not until the Plaintiff’s deposition that the amount of the damages she is seeking on behalf of the class became evident. CAFA requires that the claims of the individual class members are proposed aggregated to exceed $5 million. Equifax did not have that information until Plaintiff’s deposition. III. PLAINTIFF’S REQUEST FOR SANCTIONS IS UNSUPPORTED. Plaintiff’s request for sanctions and her allegation of a violation of Rule 11 are ludicrous. Equifax did not misrepresent any evidence, as Plaintiff claims. In fact, her counsel attached to his declaration the very pages from her deposition on which Plaintiff testified that “even $25,000 apiece would not be enough for [her] to settle -- to resolve the damages on behalf of the persons that are similarly situated.” Equifax’s removal was proper and supported by the record. No such sanction is warranted and Plaintiff’s request for attorney’s fees and costs should be denied. CONCLUSION Plaintiff’s tactic is fairly obvious. She wants to move forward with an unlimited amount in controversy but not in this Court. If Plaintiff seriously believes that her claim is limited to under the jurisdictional amount, why doesn’t she say so? This Court should retain jurisdiction. Plaintiff’s deposition testimony establishes, for the first time, that she may claim as much as $25,000 damages for each of the 1000 class members (2 classes of 500 members), totaling Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 9 of 11 - 10 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 $25,000,000. Further, that amount does not include Plaintiff’s claim for attorney’s fees and punitive damages. Equifax has met its burden of showing more likely than not that the amount in controversy exceeds $5,000,000. Plaintiff’s motion to remand is without merit and should be denied. NOKES & QUINN Dated: May 30, 2008 _/S/ THOMAS P. QUINN, JR. THOMAS P. QUINN, JR. BARRY GOHEEN LEWIS P. PERLING KING & SPALDING LLP Attorneys for Defendant EQUIFAX INFORMATION SERVICES, LLC Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 10 of 11 - 11 - __________________________________________________________________________ RESPONSE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOKES & QUINN 450 Ocean Avenue Laguna Beach, CA 92651 (949) 376-3055 5100023 CERTIFICATE OF SERVICE CARVALHO v DEFENDANT EQUIFAX, et al, CASE NO: 5:08-CV-01317-JF I, the undersigned, certify and declare that I am over the age of 18 years, employed in the County of Orange, State of California, and not a party to the above-entitled cause. On May 30, 2008. I served a true copy of the RESPOSNE IN OPPOSITION TO PLAINTIFF’S MOTION TO REMAND [ ] By personally delivering it to the persons(s) indicated below in the manner as provided in FRCivP5(B); [ ] By depositing it in the United States Mail in a sealed envelope with the postage thereon fully prepaid to the following; [X] By ECF: On this date, I electronically filed the following document(s) with the Clerk of the Court using the CM/ECF system, which sent electronic notification of such filing to all other parties appearing on the docket sheet; Ron Keith Bochner Law Office of Ron Bochner 3333 Bowers Avenue, Suite 130 Santa Clara, CA 95054 Deanna L. Johnston Kelli A. Crouch Jones Day 555 California Street, 26th Floor San Francisco, CA 94104-1500 Stephen Julian Newman Brian C. Frontino Strook & Strook 2029 Century Park East Los Angeles, CA 90067 I hereby certify that I am employed in the office of a member of the Bar of this Court at whose direction the service was made. I hereby certify under the penalty of perjury that the foregoing is true and correct. /S/ YVONNE M. HOMAN YVONNE M. HOMAN Case 5:08-cv-01317-JF Document 27 Filed 05/30/2008 Page 11 of 11 Case 5:08-cv-01317-JF Document 27-2 Filed 05/30/2008 Page 1 of 8 Case 5:08-cv-01317-JF Document 27-2 Filed 05/30/2008 Page 2 of 8 Case 5:08-cv-01317-JF Document 27-2 Filed 05/30/2008 Page 3 of 8 Case 5:08-cv-01317-JF Document 27-2 Filed 05/30/2008 Page 4 of 8 Case 5:08-cv-01317-JF Document 27-2 Filed 05/30/2008 Page 5 of 8 Case 5:08-cv-01317-JF Document 27-2 Filed 05/30/2008 Page 6 of 8 Case 5:08-cv-01317-JF Document 27-2 Filed 05/30/2008 Page 7 of 8 Case 5:08-cv-01317-JF Document 27-2 Filed 05/30/2008 Page 8 of 8