Pirozzi v. Massage Envy Franchising, No. 19-8014 (8th Cir. 2019)
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Plaintiffs filed a class action in state court against Massage Envy, alleging that the company violated the Missouri Merchandising Practices Act (MMPA) when advertisements for its one hour massage session failed to disclose that the session included ten minutes to undress, dress, and consult with the therapist. Massage Envy removed the case to district court under the Class Action Fairness Act.
The Eighth Circuit held that the district court misapplied controlling Supreme Court and Eighth Circuit CAFA precedents. The court held that the district court erred when it evaluated the MMPA violations alleged in plaintiffs' second amended petition and remanded the class action to state court because "it is more likely that a reasonable fact finder would not award several million dollars in punitive damages." In this case, the district court's consideration went to the merits of plaintiffs' claims. The court held that plaintiffs' allegation that they were entitled to punitive damages in an unstated amount raised the amount in controversy to more than $5 million, whether or not they ultimately prove they were entitled to the punitive damages they claimed. Finally, the court also held that when Massage Envy investigated and filed a notice of removal based on the results of its own amount-in-controversy investigation, the notice was not untimely. Therefore, the court granted the petition for permission to appeal, reversed the July 2019 order of remand, denied plaintiffs' motion for remand, and remanded for further proceedings.
Court Description: Loken, Author, with Shepherd and Grasz, Circuit Judges] Civil case - Missouri Merchandising Practices Act. The district court erred when it remanded the case to state court because the amount in controversy did not exceed $5 million; defendant had plausibly alleged that more than that amount was in controversy and the punitive damages claimed in plaintiff's petition were sufficient to to raise the amount in controversy above the threshold; removal notice was not untimely because neither the initial nor the second amended petition disclosed an aggregate amount in controversy or permitted defendant to unambiguously ascertain that more than $5 million was in controversy; when defendant investigated and filed a notice of removal based on the results of its own amount-in-controversy investigation, the notice was not untimely. [ September 16, 2019
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