Category Archives Tenth Circuit

Everybody’s talkin’ all this stuff about LLCs. Well, not exactly, but the Tenth Circuit is talking about LLC citizenship. Joining the chorus of every other circuit court to consider the issue, the Tenth Circuit recently held that citizenship of an unincorporated association (e.g., an LLC) for removal-diversity purposes is to be determined by reference to the citizenship of each of its members. See Siloam Springs Hotel, L.L.C. v. Century Sur. Co., No. 14-6119, 2015 WL 1430335 (10th Cir. Mar. 31, 2015). Were this a class action, the result would be different. For purposes of CAFA, said the Court in footnote 1, an LLC’s citizenship for removal-diversity purposes is determined in the same manner as a corporation—by its state of organization and principal place of business. Why the different result under CAFA? As the Tenth Circuit put it: Not my prerogative. The prerogative to expand the established citizenship rule for corporations…

The United States Supreme Court held on Monday that a defendant seeking removal under CAFA need only allege the jurisdictional amount in its notice of removal.  Gone are the days when a defendant must quickly muster an affidavit or other evidence to include in a notice of removal to prove the jurisdictional amount-in-controversy under CAFA. This case began when the District of Kansas remanded back to state court a class action concerning allegedly deficient royalty payments.  See Owens v. Dart Cherokee Basin Operating Co., No. 12-4157, 2013 WL 2237740 (D. Kan. May 21, 2013).  (We covered the history of this case here and here).  In Dart’s removal papers, it stated that the three requirements of CAFA had been met, and more specifically with regard to the amount-in-controversy, Dart stated the putative class members’ claims totaled more than $8.2 million.  Owens moved to remand the case to state court, asserting that…

If there is one topic that has captured the attention of federal courts around the country in the past few years, it's the applicability of mandatory arbitration in putative class actions. (Indeed, during our humble blog's brief existence, we have covered the issue numerous times, most notably here, here and here).  A recent decision from the Tenth Circuit may provide the most entertaining and candid examination of the procedure district courts should take in answering that question. In Howard v. Ferrellgas Partners, L.P., Case No. 13-3061, 2014 WL 1363963 (10th Cir. Apr. 8, 2014), the court admonished all parties involved when it reversed an order from the District of Kansas denying arbitration after a year and a half of discovery on the issue of whether arbitration even applied to the parties dispute.  The time spent on discovery appeared to baffle Judge Gorsuch, who writing for the court, noted that the case seemed to…

Here's an interesting order from the District of Kansas that was published right before the Thanksgiving holiday that demonstrates how a proposed class settlement can get denied not once, but twice, if counsel does not adequately represent all members of the putative absent class. In Better v. YRC Worldwide, No. 11-2072-KHV, 2013 WL 6060952 (D. Kan. Nov. 18, 2013), the parties were before the court for a second time for preliminary approval of a securities class action settlement. While the court initially denied approval because plaintiffs failed to satisfy the Rule 23 requirements of typicality and adequacy, it appears the parties did not sufficiently address these deficiencies the second time around. Specifically, the court identified three areas where the parties failed to protect the interests of the putative class: First, approval was denied because the Court found that the proposed settlement failed to provide any benefit to certain class members while requiring…

In the notice of removal, apparently, because it may be too late if you simply plead satisfaction of the amount in controversy and wait until the amount is challenged to prove the underlying calculations.  In Dart Cherokee Basin Operating Co., LLC v. Owens, 730 F.3d 1234 (10th Cir,. September 17, 2013), Judge Hartz, joined by Judges Kelly, Tymkovich and Phillips, dissented from the Court's denial of en banc review of this issue by an equally divided vote.    In this case, the Petitioner/Defendant had removed the case pursuant to CAFA, and pleaded facts supporting satisfaction of the $5 million amount in controversy, but had waited until the Respondent/Plaintiff challenged the notice of removal to submit a declaration setting forth a calculation of potential liability.  The District Court remanded the case, holding that the declaration was untimely. Judge Hartz would have granted review, and argued that the Tenth Circuit owed a duty…

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