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Back Doctors Ltd. v. Metropolitan Property & Cas. Ins. Co.: CAFA jurisdictional limits

One of the surprising aspects of removal jurisdiction is the confusion courts have had over the "amount in controversy" requirement. Some have insisted that a removing defendant under the Class Action Fairness Act prove that a class is likely to recover more than $5 million, which is a fundamental misunderstanding of the concept of "controversy": if there is a scenario where the plaintiffs may recover more than $5 million, and plaintiffs have refused to avail themselves of the opportunity to disclaim that possible demand, remand is inappropriate. After all, then the defendant might be whipsawed by the plaintiff deciding that, gosh, there should be punitive damages once the case has been remanded to state court (something that happened to a client of mine once in the District of Minnesota).

The best legal writer around, Judge Frank Easterbrook, provides clarity in the April 1 decision Back Doctors Ltd. v. Metropolitan Property & Cas. Ins., and now courts have no excuse to get it wrong. [Jackson]

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Rafael Mangual
Project Manager,
Legal Policy

Katherine Lazarski
Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.