Earlier today, the Supreme Court issued a unanimous decision in Standard Fire Insurance Co. v. Knowles, No. 11-1450, that should make it a lot harder for plaintiffs and their counsel to avoid federal-court jurisdiction over significant class actions.

The Class Action Fairness Act of 2005 authorizes the removal of class actions to federal court when, among other things, the amount “in controversy exceeds the sum or value of $5,000,000, exclusive of interest and costs.” 28 U.S.C. § 1332(d)(2). Some class-action plaintiffs have sought to defeat federal-court jurisdiction under CAFA—and thereby force a remand to state court—by stipulating that the
Continue Reading Supreme Court Rejects Plaintiffs’ Efforts To Avoid Federal Jurisdiction By “Stipulating” To Limit Class Recoveries To Under $5 Million

The Supreme Court’s unanimous summary reversal in Nitro-Lift last week sends a strong message that state courts must adhere to the Federal Arbitration Act—a legal principle that is important to businesses seeking to enforce their contractual arbitration rights when plaintiffs file non-removable class actions in state court. Just as importantly, it confirms that the Court is more than prepared to step in when state courts defy its clearly controlling precedents.

But some state courts still may not have gotten the message. Just three days after Nitro-Lift was handed down, the Court of Appeals of Washington issued a puzzling published decision
Continue Reading Washington State Appellate Court’s Ruling Appears To Contravene Federal Arbitration Law