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Gibson v. Clean Harbors Environmental Services, Inc.

United States Court of Appeals, Eighth Circuit

October 24, 2016

Carla Gibson; Windel Lawson; Joyce Powell; Jeff Rogers; Kathy Wood; Lillie Woods Respondents
v.
Clean Harbors Environmental Services, Inc. Petitioner

          Submitted: August 4, 2016

         Appeal from United States District Court for the Western District of Arkansas - El Dorado

          Before WOLLMAN, LOKEN, and MURPHY, Circuit Judges.

          WOLLMAN, Circuit Judge.

         The district court granted respondents' motion to remand their putative class-action complaint to state court, holding that petitioner's motion to remove the action to federal court was untimely filed. We grant petitioner's petition for permission to appeal, reverse the district court's judgment, and remand the case to the district court for further proceedings.

         I. Background

         Respondents Carla Gibson, Windel Lawson, Joyce Powell, Jeff Rogers, Kathy Wood, and Lillie Woods filed their class-action complaint in the Circuit Court of Union County, Arkansas, in January 2013, amending their complaint in February 2013 to name petitioner Clean Harbors Environmental Services, Inc. (Clean Harbors) as the proper defendant. Respondents alleged state tort claims related to a chemical release from a hazardous waste storage and treatment facility operated by Clean Harbors in El Dorado, Arkansas. The complaint stated that the "exact number of class members [was] unknown, " but that "as many as 400 persons (and perhaps more)" may have been affected by Clean Harbors's chemical release. With respect to the amount in controversy, respondents stipulated that "[n]o plaintiff's or class member's individual claim [was] equal to or greater than" $75, 000; that the "total damages of the plaintiffs and the class . . . [did] not exceed" $5, 000, 000; and thus that the federal courts had "neither diversity nor Class Action Fairness Act jurisdiction" over the case.[1]

         The case proceeded in state court, and on March 11, 2016, Clean Harbors received a letter from respondents' counsel (the March 11 letter) that "recommend[ed] a total payment of $6, 500, 000 to resolve" the case and asserting the following basis for the settlement recommendation:

[C]ounsel for plaintiffs received contact from almost 2, 100 individuals [affected by the chemical release] within a short time of the occurrence.
* * *
The area defined in plaintiffs' class certification motion contains an estimated 5, 653 total residents. This does not account for those who were present in the impact area for work or other reasons. If we estimate another 500 class members for this latter group, we are dealing with over 6, 000 potential claims. Defendant's expert has suggested the area of impact to be smaller than plaintiffs believe it is. However, given the number of contacts that were received from those present in the area of impact and the consistency of the experiences they related, we believe the number of valid claims will be closer to 6, 000. If this many claims are presented, then the average amount paid would be right at $700 (after deduction for fees and costs). However, even if this estimate is high and there are 5, 000 claims presented, the average amount paid per claim (again after deduction for fees and costs) in this case would be less than $850 per claim. Again, given the reaction people experienced from being exposed to a more severe irritant, we do not believe this amount to be excessive.

         On April 21, 2016, Clean Harbors received respondents' expert report, which set forth the scientific methodology on which respondents based their determination of the geographical area allegedly affected by the chemical release.

         Clean Harbors removed the case to the United States District Court for the Western District of Arkansas on May 9, 2016, citing the Class Action Fairness Act of 2005 (CAFA), under which a federal district court has jurisdiction to hear a class action if, among other requirements, the class exceeds one hundred members and the amount in controversy exceeds $5, 000, 000 in the aggregate. 28 U.S.C. § 1332(d)(2), (d)(5)(B); see also id. § 1453(b) (noting that a class action may be removed by a defendant to federal court "in accordance with" the removal provisions set forth in 28 U.S.C. § 1446). If the case as pled in the initial complaint satisfies CAFA's jurisdictional requirements, 28 U.S.C. § 1446(b)(1) requires that the defendant remove the case within thirty days after receiving a copy of the complaint. If, on the other hand, the case as pled in the initial complaint does not satisfy CAFA's jurisdictional requirements, 28 U.S.C. § 1446(b)(3) requires that the defendant remove the case within thirty days after receiving "an amended pleading, motion, order or other paper from which it may first be ascertained that the case is one which is or has become removable."

         Clean Harbors's notice of removal argued that neither the initial complaint nor the March 11 letter set forth a basis for removal because the allegations in those documents concerning the number of class members and the associated amount in controversy had been "based on unscientific and subjective information compiled by respondents' counsel's staff" from phone calls to counsel by individuals allegedly affected by the chemical release and "inquiring about filing suit." Thus, according to Clean Harbors, its notice of removal was timely because it was filed within thirty days after its April 21, 2016, receipt of the expert report, which constituted the "other ...


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