Facts
- A royalty owner filed a putative class action in Kansas state court alleging oil-and-gas royalty underpayments and related contract claims.
- The complaint sought damages described as “fair and reasonable” but did not plead a specific monetary amount.
- The defendants removed the case to federal court under the Class Action Fairness Act (CAFA), alleging the amount in controversy exceeded $5 million.
- The notice of removal alleged more than $8.2 million in controversy but did not attach supporting evidence.
- After the plaintiff moved to remand, the defendants submitted a declaration with calculations asserting more than $11 million in controversy.
- The district court remanded, concluding the notice was insufficient because it lacked evidentiary support and refusing to consider the later declaration.
- The court of appeals denied discretionary review of the remand order under CAFA’s appeal provision without explanation.
Issues
- Whether a removing defendant must include evidence supporting the amount in controversy in the notice of removal, or whether a plausible allegation suffices unless contested.
- Whether the court of appeals abused its discretion in denying permission to appeal a remand order grounded on an incorrect legal standard for removal.
Decision
- The Supreme Court reversed and held that a notice of removal need include only a plausible allegation that the amount in controversy exceeds the jurisdictional threshold; evidentiary submissions are not required in the notice itself.
- If the plaintiff contests the allegation or the court questions it, the parties must submit proof and the court determines the amount in controversy by a preponderance of the evidence.
- The Court stated that no presumption against removal applies in cases removed under CAFA.
- The Court held the court of appeals abused its discretion in denying review where the remand order rested on an erroneous understanding of the notice-of-removal requirement.
Legal Principles
- Under 28 U.S.C. § 1446(a), a notice of removal must contain a “short and plain statement of the grounds for removal,” paralleling the pleading standard of Federal Rule of Civil Procedure 8(a).
- When the complaint does not state a specific amount of damages, the defendant may allege the amount in controversy in the notice of removal.
- Evidence regarding the amount in controversy is required only after the allegation is contested or questioned; the court then applies a preponderance-of-the-evidence standard.
- In CAFA removals, courts should not apply an anti-removal presumption.
Conclusion
The Court established that CAFA removals follow ordinary pleading rules: a notice of removal must plausibly allege the jurisdictional amount, with proof required only if the allegation is challenged, and lower courts may not demand evidence at the notice stage or apply a presumption against CAFA removal.