Freeman v. Blue Ridge Paper Products, Inc

Dec 29: In the U.S. Court of Appeals, Six Circuit, Case No. 08-6321. The case is a class action for nuisance in the form of water pollution from a paper mill involves an effort by plaintiffs to avoid removal to Federal court under the Class Action Fairness Act (CAFA) of 2005. Plaintiffs, three-hundred landowners who own property in Tennessee downriver from Blue Ridge’s paper mill in Canton, North Carolina, divided their suit into five separate suits covering distinct six-month time periods, with plaintiffs’ limiting the total damages for each suit to less than CAFA’s $5 million threshold.

The suits were filed in state court with identical parties and claims, except that the suits were for a series of different, sequential six-month periods. Each suit limited the total class damages to less than $4.9 million. The cases were removed to Federal court by the defendant paper mill, but remanded by the district court. The Appeals Court indicates that, "Because no colorable basis for dividing the claims has been identified by the plaintiffs other than to avoid the clear purpose of CAFA, remand was not proper."

In a split decision, the majority ruled, "The remand order is reversed and the case remanded for the district court to consider whether the aggregated cases satisfy the amount in controversy requirement under § 1332(d). The attorney fee order is also reversed." The dissenting justice says, "There is no gainsaying the point emphasized by the majority that CAFA was intended to prevent local courts from 'keeping [class action] cases of national importance out of Federal court' . . . The aspect of this case that the majority overlooks, however, is the fact that this class action is not a 'case of national importance' but is, instead, a matter of local concern."

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