A Class Action Case Removed To Federal Court Stays There Absent Evidence The Matter Is One Of Local Controversy.

Plaintiff filed a class action against defendants in state court, alleging violations of various provisions of state law relating to automobile contracts. Defendants removed the matter to federal court.  Presenting no evidence, but arguing the way the class was defined in the complaint supported the request, plaintiff requested the federal trial court to return the matter to state court under the local controversy exception to the Class Action Fairness Act of 2005 [CAFA; 28 U.S.C. § 1332(d)(4)(A)]. The class members were defined in the pleading as “all persons who, in the four years prior to the filing of this complaint, (1) purchased a vehicle from Ron Baker for personal use to be registered in the State of California, and (2) signed a [Retail Installment Sale Contract (RISC)] that failed to separately disclose , on the RISC, the amounts paid for license fees and/or the amounts paid for registration, transfer, and/or titling fees.” The case was ordered back to state court and defendants appealed in federal court. The Ninth Circuit reversed, stating: “We conclude that there must ordinarily be facts in evidence to support a finding that two-thirds of putative class members are local state citizens, which is one of the local controversy exception’s requirements, if that question is disputed before the district court. A pure inference regarding the citizenship of prospective class members may be sufficient if the class is defined as limited to citizens of the state in question, but otherwise such a finding should not be based on guesswork.”  (Mondragon v. Capital One Auto Finance (Ninth Cir.; November 27, 2013) 736 F.3d 880.)