The U.S. Supreme Court heard oral argument this week in Dart Cherokee Basin Operating Co. v. Owens, No. 13-719 (SCOTUSblog page) (transcript). This case involves whether a defendant must provide evidence with its notice of removal under the Class Action Fairness Act to support the amount in controversy. I wrote about this case after certiorari was granted (see my April 10 blog post). In my view, the applicable statute (28 U.S.C. § 1446(a)) seems quite clear that evidence is not required with the notice of removal. So I thought the case might be an easy one for the Court.  

Attempting to read the tea leaves from the oral argument, it appeared from the Justices’ questions that a number of them appeared to agree with me. But that is only if they reach the merits.

Surprisingly, a main focus of the oral argument was on whether the Court has jurisdiction to hear the case. CAFA provides courts of appeals with discretion to grant or deny permission to appeal, analogous to the discretion that the Supreme Court has in deciding whether to grant certiorari. Some of the Justices’ questions suggested that they were concerned that the Court might not have jurisdiction where a court of appeals denies review, or that the Court’s role in that circumstance might be limited to deciding whether a court of appeals abused its discretion in denying review. Justices pointed out that an abuse of discretion standard could be difficult to apply because in Dart, and in most cases where review is denied, no reason is given. There was some discussion about the fact that an error of law could be an abuse of discretion. But it was also noted that the Tenth Circuit majority might have denied review simply because the judges were too busy.

It’s puzzling to me why the Court was concerned about this, given that its first CAFA case, Standard Fire Ins. Co. v. Knowles, one that I worked on, was a case that came to the Court with the exact same procedural posture. The Eighth Circuit had denied permission to appeal without giving reasons. The Court granted certiorari, and then decided the merits. The Court’s opinion did not suggest that it was deciding whether the Eighth Circuit abused its discretion in denying review, and reached the merits. Jurisdiction was briefed as it always is, but no party or amicus directly challenged the Court’s jurisdiction.

It does not seem to make sense that Congress, in granting the courts of appeals discretion to hear a CAFA appeal (similar to the discretion provided under 28 U.S.C. § 1292(b)), would intend to prevent or limit the Supreme Court’s discretion, under its broad certiorari jurisdiction, to hear the same appeal. Just because the court of appeals declines to exercise its discretion does not mean the Supreme Court should not have an opportunity to exercise its own discretion and review the district court decision. Congress likely did not include the Supreme Court in the provision allowing discretionary appellate jurisdiction under CAFA (or 1292(b) or Rule 23(f)) because the Court has broad certiorari jurisdiction after the court of appeals has acted.

Limiting the Court’s review power to instances where the court of appeals has granted review would be problematic because, once a court of appeals has squarely decided a question, it is very unlikely to grant review again to decide the same issue. So if the losing party in the first case that is decided on an issue does not seek certiorari, or the Court for whatever reason denies certiorari, there might be no opportunity to get an important issue to the Court, unless the Court can grant review after a court of appeals denies review. In Knowles, for example, the question presented had been decided by the Eighth Circuit in another case, but there was no petition for certiorari filed in that case. So it was very unlikely that there would be another case in which the Eighth Circuit would grant review. Most likely, the only way the Supreme Court could hear a case on that issue arising out of that circuit would if the Court took a case in which the circuit denied review.

Both logic and practicalities appear to support the Court having jurisdiction to take cases under CAFA (or Rule 23(f) or 28 U.S.C. 1292(b)) after a court of appeals denies review. The Court, on relatively rare occasions, reviews even state trial court decisions where discretionary review has been denied by the state appellate and/or supreme courts.  See, e.g., Norfolk & Western Ry. v. Ayers, 538 U.S. 135, 144 (2003). It seems odd that the Court would find that Congress intended this procedure to operate differently in cases in the federal system where intermediate appellate review is discretionary. We’ll see what the Court does.

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Photo of Wystan Ackerman Wystan Ackerman

Wystan Ackerman is a partner in Robinson+Cole’s Insurance + Reinsurance Group and handles a diverse range of property insurance litigation, including large business interruption cases, class actions, other complex litigation, and appeals. He also has substantial experience representing insurance companies in putative class…

Wystan Ackerman is a partner in Robinson+Cole’s Insurance + Reinsurance Group and handles a diverse range of property insurance litigation, including large business interruption cases, class actions, other complex litigation, and appeals. He also has substantial experience representing insurance companies in putative class actions involving homeowners’ insurance coverage and market conduct/claim-handling practices. He has been prominently involved in high-profile property insurance litigation concerning the September 11th catastrophe and Hurricane Katrina, and Chinese-made drywall. Based in the insurance capital of Hartford, Connecticut, Wystan writes the blog Insurance Class Actions Insider, which was selected by Lexis Nexis as a top insurance blog for 2011.

Wystan grew up in Deep River, Connecticut, a small town on the west side of the Connecticut River in the south central part of the state. He always had strong interests in history, politics and baseball and his heroes growing up were Abraham Lincoln and Wade Boggs (at that time the third baseman for the Boston Red Sox). Wystan says it was his early fascination with Lincoln that drove him to practice law. As a high school senior, he was one of Connecticut’s two delegates to the U.S. Senate Youth Program, which further solidified his interest in law and government. He went on to Bowdoin College, where he wrote for the Bowdoin Orient and majored in government. After Bowdoin, he went on to Columbia Law School. He also interned in the chambers of then-Judge Sonia Sotomayor on the Second Circuit. Wystan graduated from Columbia in 2001, then worked at Skadden Arps in Boston before returning to Connecticut and joining Robinson+Cole.

When Wystan’s not at his desk, flying around the country trying to save insurance companies from the plaintiffs’ bar, or attending a conference on class actions or insurance litigation he often can be found watching “Dora the Explorer” or reading or playing whiffleball with his young daughter, helping his wife with her business, Option Realty, reading a book about history or politics, or watching the Boston Red Sox.

Read Wystan’s bio.