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Jeffrey Stein, et al v. American Express Travel Related Services

September 23, 2011


The opinion of the court was delivered by: Gladys Kessler United States District Judge


Plaintiffs have filed a Motion for Remand and Award of Costs. Upon consideration of the Motion, the Opposition, the Reply, and the applicable case law, and for the reasons set forth herein, the Court concludes that the Motion should be granted.


On June 30, 2011, Plaintiff Jeffrey Stein ("Stein") filed a Complaint in the Superior Court for the District of Columbia against various American Express corporate Defendants. On July 19, 2011, Plaintiff filed a First Amended Complaint ("FAC") in Superior Court and added Amavi Kunu as an additional Plaintiff. Both Plaintiffs filed as private attorney generals. The FAC contained seven counts alleging violations by the Defendants of the D.C. Consumer Protection Procedures Act, D.C. Code 28-3901 (the "DCCPA" or the "Act"). On July 29, 2011, Defendants removed this law suit to the Federal District Court for the District of Columbia. Plaintiffs now challenge that removal and move for a remand back to the Superior Court of the District of Columbia.


A. General Principles of Law

The general law on removal and remand is well established. Under 28 U.S.C. § 1441(a), a Defendant may remove any civil action filed in a state court to the appropriate federal district court so long as that court has "original jurisdiction." When a plaintiff seeks to remand to state court a case that was removed to federal court, the "party opposing remand bears the burden of establishing that subject matter jurisdiction exists in federal court." Int'l. Union of Bricklayers and Allied Craftworkers v. Ins. Co. of the West, 366 F. Supp. 2d 33, 37 (D.D.C. 2005).

Under our federal system, "federal courts are courts of limited jurisdiction." Int'l. Union, 366 F. Supp. 2d at 36; St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 282, 288 (1938). Indeed, "the law presumes that 'a cause lies outside of the court's limited jurisdiction.'" Julien v. CCA of Tennessee, Inc., 268 F. Supp. 2d 19, 21 (D.D.C. 2003), citing Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375, 377 (1994). Because of the limited jurisdiction of federal courts, any doubts as to whether such federal jurisdiction exists in any given case must be resolved in favor of remand. See Harding-Wright v. District of Columbia Water and Sewer Authority, 350 F. Supp. 2d 102, 104 (D.D.C. 2005). See also Nwachukwu v. Karl, 223 F. Supp. 2d 60, 66 (D.D.C. 2002); Johnson-Brown v. 2200 M Street, LLC, 257 F. Supp.2d 175, 177 (D.D.C. 2003) ("the court must resolve any ambiguities concerning the propriety of removal in favor of remand"). As a consequence, "if federal jurisdiction is doubtful, a remand to state court is necessary." Dickson v. Coburg Dairy, Inc., 369 F.3d 811, 815-16 (4th Cir. 2003) (en banc). See also Bhagwanani v. Howard University, 355 F. Supp. 2d 294, 297 (D.D.C. 2005).

Finally, the Supreme Court has held that "the presence or absence of federal question jurisdiction is governed by the well pleaded complaint rule, which provides that federal jurisdiction exists only when a federal question is presented on the face of the plaintiff's properly pleaded complaint." Rivit v. Regions Bank of La., 522 U.S. 470, 475 (1998). As a result of this rule, plaintiff becomes "the master of [her] claim . . . [and] may avoid federal jurisdiction by exclusive reliance on state law." NASA Federal Credit Union v. W. Jenkins Plumbing & Heating Co., 607 F. Supp.2d 213, 215 (D.D.C. 2009). As "master of her claim," plaintiff determines whether she is relying upon federal or state law. All of the complaint's well pleaded factual allegations must be considered as true and the court must draw all reasonable inferences from those allegations in the plaintiff's favor. G. Keys PC/Logis NP v. Pope, 630 F. Supp. 2d 13, 16 (D.D.C. 2009). Therefore, the Court now must determine whether, as Defendants argue, on the face of the FAC, there is federal question jurisdiction under § 1331 and/or under the Class Action Fairness Act, 28 U.S.C. §§ 1332(d), 1453, and 1711-1715 ("CAFA").*fn1

B. Federal Jurisdiction Under Section 1331

Defendants argue that there is jurisdiction under Section 1331 because there is a "federal question" stemming from the FAC's references to the Fourth Amendment.

Initially, it is significant that in their First Amended Complaint -- filed before removal to federal court -- Plaintiffs have relied exclusively on D.C. law and have only asserted causes of action under the local DCCPA. Each and every one of Plaintiffs' seven counts against the Defendants allege various violations of only one statute -- the DCCPA. No federal statute is relied on anywhere in the FAC.

Defendants argue that because "the FAC seeks remedies for the deprivation of Fourth Amendment and other federal privacy protections . . . [t]his case cannot be litigated without thorough examination of those federal rights, their scope and the circumstances under which they may lawfully be abrogated. The case is pervaded with federal questions. . . ." Defs.' Opp. at 5-6. This argument ignores the "well pleaded complaint rule," which mandates that a court's basis of jurisdiction, whether state or federal, must be clearly expressed on the face of the complaint. It also misinterprets, or misstates, the essence of Plaintiffs' FAC.

Plaintiffs have not pled any violation of the Fourth Amendment. Nor do they seek any relief under the Fourth Amendment. Rather, they are alleging deceptive trade practices by American Express, namely, outsourcing the handling of card members' private data to foreign countries, which, in practice, affects the constitutional rights of those members, without giving them any notice or disclosure of the ramifications of that practice. The central issue in Plaintiffs' Complaint is whether the actions they allege are deceptive constitute a violation of the DCCPA -- not whether they constitute a violation of the Fourth Amendment. Federal question jurisdiction does not exist simply because principles of federal law may be ...

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