Class Action Fairness Act

Home Depot U.S.A. Inc. v. Jackson

Issues

Can a third-party defendant in a class action suit remove a counterclaim from state court to federal court?

This case asks the Supreme Court whether a third-party defendant in a state court class action may remove a counterclaim from state court to federal court. Petitioner Home Depot U.S.A. Inc. (“Home Depot”) argues that the Supreme Court’s case Shamrock Oil & Gas Co. v. Sheets, which holds that an original plaintiff may not remove a counterclaim to federal court, does not apply to third-party defendants. Moreover, Home Depot asserts that the text of the Class Action Fairness Act (“CAFA”) allows for the removal of class action counterclaims by any defendant, including third-party defendants. Conversely, Respondent George W. Jackson—a class action representative who counterclaimed against Home Depot—contends that Shamrock Oil actually bars third-party defendants from removing. Furthermore, Jackson maintains that CAFA’s discussion of removal does not explicitly expand the term “defendant” to third-party defendants, and thus should not be read to allow Home Depot to remove Jackson’s counterclaim. This case has large implications for consumer class action suits in state court, as it will affect class action litigation strategy and forum selection in potentially hostile state courts.

Questions as Framed for the Court by the Parties

(1) Whether, under the Class Action Fairness Act—which permits “any defendant” in a state-court class action to remove the action to federal court if it satisfies certain jurisdictional requirements­—an original defendant to a class-action claim that was originally asserted as a counterclaim against a co-defendant can remove the class action to federal court if it otherwise satisfies the jurisdictional requirements of the Class Action Fairness Act; and

(2) whether the Supreme Court's holding in Shamrock Oil & Gas Co. v. Sheets—that an original plaintiff may not remove a counterclaim against it—extends to third-party counterclaim defendants.

In June 2016, Citibank, N.A. (“Citibank”) sued George W. Jackson in North Carolina state court to collect on his credit card debt. Jackson v. Home Depot U.S.A., Inc. at 3.

Written by

Edited by

Additional Resources

Submit for publication
0

Mississippi ex rel. Hood v. AU Optronics Corp.

Issues

When is a state’s parens patriae action a “mass action” under the Class Action Fairness Act, and therefore removable to federal court?

Over the course of a decade, a group of companies allegedly engaged in a massive conspiracy to fix the price of liquid crystal display (“LCD”) panels. Following criminal convictions and sentences, the State of Mississippi, along with twelve other states, filed a parens patriae action against the companies, seeking damages under state law. The defendant companies removed the action to district court under the Class Action Fairness Act (“CAFA”) of 2005, and the district court remanded the case to state court. On appeal, the Fifth Circuit reversed the lower court’s decision and held that Mississippi’s parens patriae action was a mass action, and therefore removable under CAFA. The Supreme Court will decide whether a state’s parens patriae action (i.e., on behalf of its citizens) constitutes a “mass action” under CAFA, and can therefore be removed to federal court. The Court’s decision will determine the possible forums for state parens patriae actions, and thereby shape states’ decisions to pursue such actions.

Questions as Framed for the Court by the Parties

Whether a state's parens patriae action is removable as a "mass action" under the Class Action Fairness Act when the state is the sole plaintiff, the claims arise under state law, and the state attorney general possesses statutory and common-law authority to assert all claims in the complaint.

top

Facts

In 2005, Congress passed the Class Action Fairness Act (“CAFA”), vastly expanding federal jurisdiction over class action lawsuits. See Mississippi ex rel. Hood v. AU Optronics Corp., 876 F. Supp.

Written by

Edited by

Additional Resources

top

Submit for publication
0
Subscribe to Class Action Fairness Act