Rey v. Bristol Hospice, LLC

Summary

The United States District Court for the Northern District of California granted plaintiff's renewed request to remand the class action to California state court under the local controversy exception to the Class Action Fairness Act. The court held that a prior class action did not bar remand because its class allegations had been dismissed at the outset and it therefore did not qualify as an earlier class action under 28 U.S.C. § 1332(d)(4)(A)(ii). The court remanded the case to the California Superior Court for Alameda County and ordered each side to bear its own fees and costs.

Holdings

1. A prior action does not qualify as an 'other class action' under 28 U.S.C. § 1332(d)(4)(A)(ii) when its class allegations were dismissed at the very start of the litigation and the case proceeded only as an individual arbitration matter.
2. The amended complaint plausibly satisfied the uncontested requirements that Optimal Health's conduct formed a significant basis of the claims and relief sought and that more than two-thirds of the proposed class members were California citizens; with no qualifying prior class action, the local controversy exception applied.

Questions Presented

1. Whether the amended complaint plausibly established the CAFA local controversy exception's requirements that Optimal Health's conduct form a significant basis of the claims and relief sought and that more than two-thirds of the proposed class members be California citizens.
2. Whether the prior Olmos action barred remand under 28 U.S.C. § 1332(d)(4)(A)(ii) as another class action filed within the preceding three years asserting the same or similar factual allegations.

Disposition

remanded