Stroock Special Bulletin
"When Is An Action 'Commenced' Under The Class Action Fairness Act Of 2005?"
The Class Action Fairness Act of 2005 (“CAFA”) expands diversity jurisdiction for qualifying class actions and authorizes their removal. Pub. L. No. 109-2, 119 Stat. 4 (2005). For a defendant to secure federal jurisdiction under CAFA, the civil action must have been “commenced” on or after February 18, 2005. See Exxon Mobil Corp. v. Allapattah Servs., Inc., 125 S. Ct. 2611, 2628, 162 L. Ed. 2d 502 (2005); Pub. L. No. 109-2, § 9.
Because the language of CAFA is “commenced,” not “filed,” there has been substantial litigation as to when pending state-court actions can be removed based on a theory that they were “commenced” on or after February 18, 2005. Thus far, courts have reached varying conclusions as to what “commencement” means, and the issue is important for defendants. This is so because the general, one-year limitation on removal does not apply under CAFA. See 28 U.S.C. § 1446(b) (2006) (stating the requirement that a defendant remove within thirty days of the point at which it may first be ascertained that the action is removable but, in any event, removal based on diversity must be effected within one year after the action is filed); compare 28 U.S.C. § 1453(b) (2006) (stating that class actions may be removed in accordance with Section 1446, except that the one-year limitation of Section 1446(b) does not apply).
Accordingly, depending on how a particular action progresses with respect to the facts and the claims asserted, and how the analysis of “commencement” develops in the courts, a defendant might have the opportunity to remove under CAFA long after an action was filed.