Court Denies Remand Holding CAFA’s Amount In Controversy Requirement Was Met

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The United States District Court for the Northern District of Illinois denied plaintiff’s renewed motion to remand, holding that defendants had demonstrated that it was plausible that CAFA’s amount in controversy requirement had been exceeded and plaintiff had failed to make an irrevocable commitment to obtain less than $5,000,000 in damages.  The district court initially granted plaintiff’s motion to remand but, as we previously reported, the Seventh Circuit reversed.

Plaintiff’s complaint alleged that defendants violated the Illinois Consumer Fraud and Deceptive Business Act by improperly filing and threatening to file lawsuits against plaintiff and the putative class without properly being registered as a debt collector in Illinois.  The court rejected plaintiff’s argument that the class could be awarded only $355,407.62 in compensatory damages because plaintiff had only submitted calculations including the amounts actually recovered by defendants through allegedly improper judgments.  Citing an affidavit submitted by counsel for one of the defendants, the court found that an additional $1.2 million in compensatory damages had to be factored into the amount in controversy calculation because plaintiff’s potential recovery also included improperly entered judgments not yet recovered.  Adding these potential damages, the amount of potential attorney’s fees, and the maximum permissible amount of punitive damages (at a 9:1 ratio), the court found that the amount in controversy could plausibly well exceed the required $5,000,000 and denied plaintiff’s renewed motion to remand.

Johnson v. Pushpin Holdings, LLC, No. 13-7468, slip op. (N.D. Ill. Aug. 13, 2014)

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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