Unreported / Non-Citable
Background
Michael Yamamoto filed a putative class action against FedEx Corporation and Federal Express Corporation in Los Angeles County Superior Court asserting wage-and-hour and California Business & Professions Code § 17200 (UCL) claims, including failure to pay overtime, minimum, and final wages, wage statement violations, and violation of Labor Code § 227.3. Defendants removed under the Class Action Fairness Act (CAFA), 28 U.S.C. § 1332(d). Yamamoto moved to remand, challenging both minimal diversity and the $5 million amount-in-controversy threshold.
The Court’s Holding
Judge Percy Anderson denied the motion to remand. On minimal diversity, the court accepted the Notice of Removal’s allegations: Yamamoto is a California citizen, and FedEx and Federal Express are citizens of Delaware and Tennessee. CAFA only requires that any one plaintiff be diverse from any one defendant.
On amount in controversy, defendants’ calculations using conservative assumptions about the class size, hourly rates, and per-employee damages exceeded the $5 million threshold. The court noted that defendants’ assumptions were actually quite conservative compared to the actual workforce data — affected employees earned at least $15/hour, part-time workers were guaranteed at least 3.5 hours per day, and 20% of workers were full-time. Yamamoto’s argument that some claims were barred by a release from a prior class action was irrelevant under Arias v. Residence Inn by Marriott — the strength of defenses goes to merits, not to amount in controversy.
On Yamamoto’s argument that the court should remand the UCL claim for lack of equitable jurisdiction (citing Sonner v. Premier Nutrition), the court held that Sonner’s rule against equitable jurisdiction over restitution-only claims did not apply because Yamamoto also sought prospective injunctive relief, distinguishing Steen v. American National Insurance. Even if equitable jurisdiction were lacking, the court noted that 28 U.S.C. § 1447(c) authorizes remand of an entire case but not piecemeal remand of individual claims.
Key Takeaways
- CAFA jurisdiction requires only minimal diversity (any one plaintiff vs. any one defendant) — much easier to establish than complete diversity.
- To meet CAFA’s $5 million threshold, defendants can rely on conservative assumptions about class size, wage rates, and per-employee damages, supported by workforce evidence.
- The strength of defenses (e.g., a class-action release from prior litigation) goes to the merits, not to amount in controversy under Arias v. Residence Inn.
- Sonner v. Premier Nutrition’s rule against equitable jurisdiction over restitution-only UCL claims does not apply where the plaintiff also seeks prospective injunctive relief (Steen v. American National Insurance).
- Federal courts cannot remand individual claims under 28 U.S.C. § 1447(c) — they can only remand the entire case.
Why It Matters
This decision is a useful CAFA-defense template for FedEx and similar large California-employer wage-and-hour class actions. The core elements: (1) minimal diversity is straightforward when defendant is incorporated outside California; (2) conservative wage-rate assumptions easily reach $5 million across a class of any reasonable size; (3) defenses are irrelevant to amount in controversy.
For plaintiffs’ counsel hoping to remand UCL claims under Sonner, the lesson is that prospective injunctive relief saves federal equitable jurisdiction. And piecemeal remand is unavailable as a matter of statute.