The Seventh Circuit has probably issued more CAFA decisions than any other Circuit, and they are certainly more interesting. Last week, in Phillips v. Ford Motor Co., ___ F.3d ___ (7th Cir. Jan. 30, 2006), the Seventh Circuit held that substituting representative plaintiffs in a pending putative class action does not "commence" a new suit and permit removal under CAFA:
Substitution of unnamed class members for named plaintiffs who fall out of the case because of settlement or other reasons is common and normally an unexceptionable ("routine") feature of class action litigation. [Citations.] But there is a potential complication here: the plaintiff class ... has not been certified ....(Slip op. at 3, 4.) The Court held that the determinative question is whether, under state law, such an amendment "relates back" for statute of limitations purposes. If it does, then no new action has been "commenced" under CAFA.
Strictly speaking, if no motion to certify has been filed (perhaps if it has been filed but not acted upon), the case is not yet a class action and so a dismissal of the named plaintiffs' claims should end the case. If the case is later restarted with a new plaintiff, it is a new commencement, a new suit. But the courts ... are not so strict. Unless jurisdiction never attached, ... or the attempt to substitute comes long after the claims of the named plaintiffs were dismissed, substitution for the named plaintiffs is allowed. [Citations.]
The courts thus disregard the jurisdictional void that is created when the named plaintiffs' claims are dismissed and, shortly afterwards, surrogates step forward to replace the named plaintiffs.
A recent Court of Appeal decision, Shapell Industries, Inc. v. Superior Court, 132 Cal.App.4th 1101 (2005), is a prime example of a (non-CAFA) case in which the "jurisdictional void" was disregarded. The Shapell court also noted the "unusual procedural scenario" presented when the representative plaintiff's claims are dismissed prior to certification, yet allowed amendment to substitute a new representative plaintiff. (My original post on Shapell is here.)