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Ramirez v. Oscar De La Renta, LLC

United States District Court, S.D. New York

May 12, 2017

MONICA RAMIREZ, individually and on behalf of other persons similarly situated who were employed by Oscar De La Renta, LLC, or any other entities affiliated with or controlled by Oscar De La Renta, LLC, Plaintiff,
v.
OSCAR DE LA RENTA, LLC, or any other entities affiliated with or controlled by Oscar de la Renta, LLC, Defendant.

          OPINION AND ORDER

          RONNIE ABRAMS, United States District Judge.

         In 2009, Plaintiff Monica Ramirez worked as an unpaid intern for Defendant Oscar De La Renta ("ODLR"), a fashion and apparel firm based in New York. Ramirez filed a putative class action against ODLR in the Supreme Court of New York, claiming that ODLR violated various provisions of the New York Labor Law. ODLR removed the action to this Court under the Class Action Fairness Act of 2005 ("CAFA"). Ramirez moves to remand the action to state court. For the reasons set forth below, Ramirez's motion is denied.

         BACKGROUND

         On September 3, 2014, Ramirez filed a complaint in the Supreme Court of New York. See Notice of Removal Ex. A (Compl.) (Dkt. 1). In the complaint, Ramirez alleges that, from approximately August 2008 through the date on which she filed her complaint, ODLR "wrongfully withheld wages from her and similarly situated individuals who worked for [ODLR]." Id. ¶2. Ramirez alleges that she worked at ODLR's Manhattan office "from approximately January of 2009 through April of 2009." Id. ¶ 7. During this period, Ramirez "typically worked five days each week, and on occasion six days a week, " and "routinely worked eight and one half hours each day." Id. ¶ 33. Ramirez claims that she was "not paid any wages." Id. ¶ 35. She asserts three claims under the New York Labor Law: (1) failure to pay minimum wage, (2) failure to pay wages, and (3) failure to provide wage notices and statements. See Id. ¶¶ 36-60. She seeks to recover unpaid wages, statutory penalties, interest, attorney's fees, and costs. See Id. ¶¶45, 53, 60; see also Id. at 12.

         On October 7, 2016, ODLR removed the action to this Court under CAFA. ODLR's notice of removal alleges that it "learned that this action satisfies the CAFA requirements" for removal "only after commencing its own independent investigation." Notice of Removal ¶ 7. The notice of removal further alleges that Ramirez's proposed class contains approximately 600 individuals, see Id. ¶ 8, and that the amount in controversy "exceeds $5 million, " id. ¶ 11.

         On November 7, 2016, Ramirez moved to remand this action to state court. See Mot. to Remand (Dkt. 16). On November 21, 2016, ODLR filed a brief in opposition to the motion. See Def. Opp'n Mem. (Dkt. 20). On December 2, 2016, Ramirez filed a reply. See Pl. Reply Mem. (Dkt. 26).

         LEGAL STANDARD

         "CAFA gives federal courts jurisdiction over certain class actions, defined in [28 U.S.C.] § 1332(d)(1), if the class has more than 100 members, the parties are minimally diverse, and the amount in controversy exceeds $5 million." Dart Cherokee Basin Operating Co., LLC v. Owens, 135 S.Ct. 547, 552 (2014) (citing 28 U.S.C. § 1332(d)(2), (5)(B)); see also Standard Fire Ins. Co. v. Knowles, 133 S.Ct. 1345, 1348 (2013). "In CAFA cases, the defendant bears the burden of establishing federal subject matter jurisdiction." Cutrone v. Mortg. Elec. Registration Sys., Inc., 749 F.3d 137, 142 (2d Cir. 2014). The defendant must demonstrate a "reasonable probability" that CAFA's jurisdictional requirements are satisfied. Blockbuster, Inc. v. Galeno, 472 F.3d 53, 58 (2d Cir. 2006) (quoting Mehlenbacher v. Akzo Nobel Salt, Inc., 216 F.3d 291, 296 (2d Cir. 2000)). "[O]nce the general requirements of CAFA jurisdiction are established, plaintiffs have the burden of demonstrating that remand is warranted on the basis of one of the enumerated exceptions." Greenwich Fin. Servs. Distressed Mortg. Fund 3 LLC v. Countrywide Fin. Corp., 603 F.3d 23, 26 (2d Cir. 2010).

         DISCUSSION

         A. Timeliness

         Ramirez first argues that ODLR's notice of removal is untimely. See Pl. Mem. at 3-5 (Dkt. 18). Under 28 U.S.C. § 1446, removal is timely if it occurs within one of two 30-day periods. First, Section 1446(b)(1) requires a defendant to file a notice of removal within 30 days of service or receipt of a copy of the initial pleading. See2S U.S.C. § 1446(b)(1). Second, Section 1446(b)(3) provides that, "[i]f the case stated by the initial pleading is not removable, " the defendant may file a notice of removal within 30 days of receiving "a copy of an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable." Id. § 1446(b)(3); see Cutrone, 749 F.3d at 142.

         In the CAFA context, the Second Circuit has adopted a "bright line rule, " under which "the removal clocks of 28 U.S.C. § 1446(b) are not triggered until the plaintiff serves the defendant with an initial pleading or other document that explicitly specifies the amount of monetary damages sought or sets forth facts from which an amount in controversy in excess of $5, 000, 000 can be ascertained." Cutrone, 749 F.3d at 145.[1] "[D]efendants have no independent duty to investigate whether a case is removable." Id. at 143; accord Moltner v. Starbucks Coffee Co., 624 F.3d 34, 37 (2d Cir. 2010); Whitaker v. Am. Telecasting, Inc., 261 F.3d 196, 206 (2d Cir. 2001). "Thus, a defendant is not required to consider material outside of the complaint or other applicable documents for facts giving rise to removability, and the removal periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3) are not triggered until the plaintiff provides facts explicitly establishing removability or alleges sufficient information for the defendant to ascertain removability." Cutrone, 749 F.3d at 145.

         Nonetheless, a defendant must "apply a reasonable amount of intelligence in ascertaining removability." Id. at 143 (quoting Moltner, 624 F.3d at 37). While the Second Circuit has not precisely delineated the scope of the "reasonable amount of intelligence" standard, it has explained that "[a] pleading enables a defendant to intelligently ascertain removability when it provides the necessary facts to support the removal petition, " including "the amount in controversy and the address of each party" in the diversity context. Moltner, 624 F.3d at 36 (quoting Whitaker, 261 F.3d at 206). Other circuits have determined that this standard may require a defendant to perform simple calculations based on figures found in pleadings or other papers served by the plaintiff. See, e.g., Romulus v. CVS Pharmacy, Inc., 770 F.3d 67, 75 (1st Cir. 2014) (holding that Section 1446's removal periods are triggered when the plaintiff provides "sufficient facts from which the amount in controversy can easily be ascertained by the defendant by simple calculation"); Kuxhausen v. BMW Fin. Servs. NA LLC, 707 F.3d 1136, 1140 (9th Cir. 2013) (holding that while "defendants need not make extrapolations or engage in guesswork" in ascertaining removability, "[multiplying figures clearly stated in a complaint is an aspect of [their] duty" to apply a reasonable amount of intelligence (internal quotation marks omitted)). But "intelligence" should not be confused with "investigation": a defendant may be required to take out a calculator while reading a complaint, but he has no duty to review his files to uncover facts not alleged in a pleading or other paper served by the plaintiff.

         Here, Ramirez did not serve ODLR with an initial pleading or other document that would trigger the removal periods of 28 U.S.C. §§ 1446(b)(1) and (b)(3). There is no dispute that neither Ramirez's complaint nor any other document served upon ODLR "explicitly specifies" the amount of damages she seeks. Cutrone, 749 F.3d at 145. Nor does Ramirez's complaint "set[] forth facts from which an amount in controversy in excess of $5, 000, 000 can be ascertained" with a reasonable amount of intelligence. Id. In particular, the complaint does not allege a number of proposed class members that would yield an amount in controversy approaching $5 million. The complaint alleges only that "[t]he size of the putative class is believed to be in excess of 40 individuals." Compl. ¶ 17. With just 40 class members, the amount in controversy would not approach $5 million-indeed, using the methodology discussed below, the amount in controversy would fall below $500, 000. Thus, even if ODLR had applied a "reasonable amount of intelligence" by "[multiplying figures clearly stated in [the] complaint, " it would not have ascertained that the amount in controversy meets CAFA's jurisdictional minimum. Kuxhausen, 707 F.3d at 1140. Accordingly, the 30-day removal periods of Section 1446 were not triggered. See Cutrone, 749 F.3d at 145.

         Ramirez opposes this conclusion with three arguments. First, Ramirez argues that ODLR failed to apply a "reasonable amount of intelligence" in ascertaining removability because it did not investigate the size of her proposed class. All ODLR had to do, Ramirez argues, was review its records to determine the number of interns it employed during the relevant period, then perform some straightforward calculations to ascertain the amount in controversy. Ramirez may be correct that determining the amount in controversy would not have required extensive effort on ODLR's part, but she is mistaken in arguing that ODLR had an obligation to look beyond her pleadings and other papers to ascertain removability. See Intelligen Power Sys., LLC v. dVentus Techs. LLC, 73 F.Supp.3d 378, 381 (S.D.N.Y. 2014) ("It is well-settled that a defendant has no independent duty to investigate whether a case is removable."). Here, it was only through "independent investigation" that ODLR discovered that Ramirez's proposed class contains approximately 600 individuals-15 times more than Ramirez alleged in her complaint. Compare Compl. ¶ 17, with Notice of Removal ¶¶ 7, 8. However straightforward this investigation might have been, ODLR's failure to conduct it earlier provides no basis for concluding that removal was untimely.

         Second, Ramirez argues that ODLR should have ascertained removability on the basis of her interrogatories and other discovery requests. See Pl. Mem. at 4. Ramirez notes, for example, that her first set of interrogatories asked ODLR to "[i]dentify each current and former individual classified as an intern" during the relevant period. Decl. in Supp. of Mot. to Remand Ex. C at 6 (Dkt. 17). To trigger the removal periods of Section 1446, however, Ramirez needed to provide ODLR information from which it could ascertain that the amount in controversy exceeds $5 million-not to ask for it. On the present record, it is not clear whether ODLR provided information responsive to Ramirez's interrogatories, and Ramirez does not argue that she ever obtained a document specifying the size of her proposed class.[2] If Ramirez had obtained such a document, she could fairly argue that the 30-day removal period of Section 1446(b)(3) would begin to run once ODLR was served. See, e.g., Romulus, 770 F.3d at 78-79 (holding that an employer's receipt of an e-mail from employees estimating the number of unpaid meal breaks for which the employees sought compensation triggered the removal period of Section 1446(b)(3)); Maguire v. A.C. & S, Inc., 73 F.Supp.3d 323, 326 (S.D.N.Y. 2014) (holding that a defendant could reasonably ascertain removability on the basis of the plaintiffs interrogatory responses). Here, however, Ramirez's interrogatories and other document requests did not contain facts from which ODLR could reasonably determine that the amount in controversy meets CAFA's jurisdictional minimum.

         Finally, Ramirez argues that a defendant should be required to investigate the amount in controversy earlier in the litigation than ODLR did here. See Pl. Mem. at 4. In Ramirez's view, a defendant should not be permitted to stall an action for an extended period-in this case, two years-by failing to review its own records and determine whether the action is removable. This is particularly true where, as here, the defendant may be in a better position to uncover facts necessary to ascertain removability. While this argument is not without force, "[t]here are contrary policy arguments that Congress could have considered" in enacting CAFA. Romulus, 770 F.3d at 75. In particular, the "bright line" rule governing the timeliness of removal encourages plaintiffs to estimate damages early in a case and avoids "fact-intensive mini-trials" into "what the defendant should have investigated, or what the defendant should have discovered through that investigation." Id. at 75-76. Congress may also have found it appropriate to assign the task of identifying facts relevant to determining removability to the plaintiff, who generally serves as "master of the complaint" and bears the burden of investigating the facts underlying her claims. In any event, as the Ninth Circuit has explained, "plaintiffs are in a position to protect themselves." Roth v. CHA Hollywood Med. Or., L.P., 720 F.3d 1121, 1126 (9th Cir. 2013). "If plaintiffs think that their action may be removable and think, further, that the defendant might delay filing a notice of removal until a strategically advantageous moment, they need only provide to the defendant a document from which removability may be ascertained." Id. Thus, Ramirez's policy arguments may well be contrary to those Congress considered in enacting CAFA, and in any event provide no basis to depart from the "bright line rule" governing removal under Section 1446. Cutrone, 749F.3d at 145.[3]

         B. Amount in Controversy

         Ramirez next argues that ODLR has not satisfied CAFA's amount-in-controversy ...


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