Jenner & Block

Seventh Circuit Rules For Jenner & Block Client in Precedent-Setting CAFA Case

On Aug. 1, 2008, the U.S. Court of Appeals for the Seventh Circuit addressed what it described as a novel legal issue, interpreting a provision of the Class Action Fairness Act, 28 USC Section 1332(d)(11) (CAFA), which the Court said "has not been addressed in this or any other circuit."  Bullard v. Burlington Northern Santa Fe Railway Co., No. 08-8011 (Aug. 1, 2008).

Affirming a District Court ruling in favor of Jenner & Block's client and other defendants, the appellate court ruled that federal court is the appropriate place to try a lawsuit filed by 144 plaintiffs against four companies that were allegedly involved in the release of toxic chemicals from a plant in Texas. The ruling sets significant legal precedent and represents a win for several defendants. 

The defendants had removed the case from Illinois state court to the U.S. District Court for the Northern District of Illinois under the recently enacted CAFA.  Under CAFA, a "mass action" -- one involving a proposed trial of the claims of more than 100 litigants -- can be removed to federal court. The plaintiffs claimed that, although they had filed a single complaint for 144 plaintiffs, theirs was not a "mass action" because they had not expressly stated that they were seeking a joint trial and might later stipulate to trial in smaller groups. The plaintiffs argued that defendants may remove a mass action only when a final pretrial order identifies 100 or more plaintiffs to be included in a single trial.

The Seventh Circuit rejected the plaintiffs' contention, holding that the case was properly removed because a joint trial is implicitly proposed by the filing of a complaint joining 100 or more plaintiffs and that it was irrelevant whether a trial covering 100 or more plaintiffs actually ensued. The Court noted that trying the claims of a few plaintiffs in such a case could have preclusive effects for the other plaintiffs.  In fact, the appeals court said, the plaintiffs in this case were essentially proposing a trial common to all plaintiffs that was the the equivalent of a removable class action.  In affirming the denial of the plaintiffs’ motion to remand, the court also mentioned that the amount in controversy requirement of CAFA is met “if at least one plaintiff demands $75,000.”

The Firm's team was led by Partners Lise T. Spacapan, Gabrielle Sigel, and Traci M. Braun and Associate Jill M. Hutchison. The decision was the subject of articles in the Chicago Daily Law Bulletin and Law 360.