Zuckman v. Monster Beverage Corporation

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
MICHAEL ZUCKMAN, on behalf of himself
and the General Public of the District of
Columbia,
Plaintiff,
v. Civil Action No. 12-1978 (JDB)
MONSTER BEVERAGE CORP.,
Defendant.
MEMORANDUM OPINION
Plaintiff Michael S. Zuckman, acting on behalf of himself and the general public, filed
this action in District of Columbia Superior Court on November 13, 2012. Zuckman alleges that
Monster Beverage Corporation (“Monster”) engaged in unlawful trade practices in violation of
the District of Columbia Consumer Protection Procedures Act (“DCCPPA”) by failing to
disclose and by misrepresenting the adverse health effects of Monster Energy drinks. Monster
removed the action, arguing that this Court has diversity jurisdiction over the matter pursuant to
28 U.S.C. § 1332(a), or, alternatively, that the Court has jurisdiction under the Class Action
Fairness Act. Zuckman now moves to remand the action to the Superior Court of the District of
Columbia for lack of subject-matter jurisdiction. For the reasons set forth below, the Court will
grant Zuckman’s motion and will remand the action.
BACKGROUND
Zuckman brings this one-count action pursuant to the DCCPPA’s private attorney general
provision, under which “[a]n individual may, on behalf of that individual, or on behalf of both
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the individual and the general public, bring an action seeking relief from the use of a trade
practice in violation of a law of the District.” D.C. Code § 28-3905(k)(1)(B). Zuckman alleges
that Monster violated the statute by misrepresenting that Monster Energy drinks are “completely
safe,” and by failing to disclose the material adverse health effects potentially caused by the
drinks’ particular ingredients. See Compl. [Docket Entry 1-1] ¶¶ 39, 40 (Nov. 13, 2012).
Zuckman claims that he “has viewed advertising for[] and regularly purchased” Monster Energy
drinks in the District of Columbia, and that he “has consumed up to two cans of Monster Energy
drink in one day on numerous occasions.” See id. ¶ 1. On behalf of himself and the general
public of the District of Columbia, Zuckman seeks relief in the form of treble or statutory
damages in the amount of $1,500 per violation; restitution for each consumer of Monster Energy
drinks; an injunction requiring Monster to disclose that the drinks have not been found
“completely safe” and are capable of causing negative health effects; and reasonable attorney
fees and costs. See id. ¶¶ 41-42.
Monster filed an opposition to the motion for remand, and Zuckman filed a reply.
Pursuant to the Court’s Order, Zuckman and his counsel also provided affidavits containing
additional information regarding the amount in controversy. Both parties filed supplemental
briefing addressing this information.
STANDARD OF REVIEW
An action originally filed in state court “may be removed by the defendant or the
defendants, to the district court of the United States for the district and division embracing the
place where such action is pending,” when it falls within the federal court’s original jurisdiction.
28 U.S.C. § 1441(a). Because of the significant federalism concerns involved, this Court strictly
construes the scope of its removal jurisdiction. See Shamrock Oil & Gas Corp. v. Sheets, 313
2
U.S. 100, 107-09 (1941); see also Bhagwanani v. Howard Univ., 355 F. Supp. 2d 294, 297
(D.D.C. 2005); Johnson-Brown v. 2200 M Street LLC, 257 F. Supp. 2d 175, 177 (D.D.C. 2003).
After removal of an action from state court, the party seeking to remain in federal court—
Monster here—bears the burden of establishing that federal jurisdiction exists. See Wilson v.
Republic Iron & Steel Co., 257 U.S. 92, 97 (1921); Bhagwanani, 355 F. Supp. 2d at 297; In re
Tobacco/Gov’tal Health Care Costs Litig., 100 F. Supp. 2d 31, 35 (D.D.C. 2000). “When it
appears that a district court lacks subject matter jurisdiction over a case that has been removed
from a state court, the district court must remand the case . . . .” Republic of Venez. v. Philip
Morris Inc., 287 F.3d 192, 196 (D.C. Cir. 2002); see also Bhagwanani, 355 F. Supp. 2d at 297.
“[T]he court must resolve any ambiguities concerning the propriety of removal in favor of
remand.” Johnson-Brown, 257 F. Supp. 2d at 177.
DISCUSSION
I. Diversity Jurisdiction
A federal court has diversity jurisdiction over an action “where the matter in controversy
exceeds the sum or value of $75,000, exclusive of interest and costs, and is between . . . citizens
of different States.” 28 U.S.C. § 1332(a). The parties agree, and the Court finds, that Zuckman, a
Maryland citizen, and Monster, a Delaware corporation principally based in California, are
completely diverse. The parties dispute, however, whether the amount in controversy is met. In
addressing this question, the Court will consider Zuckman’s claims for various types of relief:
statutory damages, attorney fees, an injunction, and restitution. The Court will assume that the
amounts sought should be added together. See, e.g., Breakman v. AOL LLC, 545 F. Supp. 2d 96,
108 (D.D.C. 2008) (discussing the combined monetary value of plaintiff’s requests for relief to
determine the amount in controversy). If the amount is at or below $75,000, the action lies
outside the Court’s diversity jurisdiction.
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A. Statutory Damages
Zuckman seeks to recover $1,500 on behalf of himself and the general public for each
statutory violation under the DCCPPA. The Supreme Court has long held that “the separate and
distinct claims of two or more plaintiffs cannot be aggregated in order to satisfy the jurisdictional
amount requirement.” See Snyder v. Harris, 394 U.S. 332, 335 (1969). Hence, only the damages
to which Zuckman would be personally entitled—rather than those on behalf of the public—will
count toward satisfying the $75,000 jurisdictional threshold. See Breakman, 545 F. Supp. 2d at
103-04.
In his complaint, Zuckman declines to specify how many alleged statutory violations
occurred, merely stating that he “regularly purchased” Monster Energy drinks in the District of
Columbia. See Compl. ¶ 1. Based on these allegations, Monster contends that it is more likely
than not that Zuckman purchased and consumed more than 50 cans, which, at $1,500 per
violation, would put him above the $75,000 threshold for federal jurisdiction. See Def.’s Opp’n
to Pl.’s Mot. for Remand [Docket Entry 10] at 5 (Jan. 28, 2013) (“Def.’s Opp’n”). Monster
further argues that the alleged “violations” include not simply purchases of cans, but also
instances of viewing allegedly misleading advertising, and that counting each such instance as a
“violation” makes it even more likely that the total number of alleged “violations” exceeds 50.
See id.
Zuckman responds that Monster mischaracterizes his claim, and that he is only asserting
as “violations” his purchases. See Reply in Supp. of Pl.’s Mot. for Remand [Docket Entry 11] at
3-4 (Feb. 8, 2013) (“Pl.’s Reply”). As to the number of cans at issue, Zuckman submitted an
affidavit in response to the Court’s Order, attesting that he purchased 15 to 20 cans in the District
of Columbia. See Aff. of Michael Zuckman [Docket Entry 13] ¶ 6 (May 30, 2013). Responding
4
to the Order’s request that Zuckman specify the total number of cans he purchased “during the
relevant period,” see Order [Docket Entry 12] at 1 (May 9, 2013), Zuckman also acknowledged
that he purchased many cans in Maryland, for an estimated total of 100 to 120 cans. See
Zuckman Aff. ¶ 5. Finally, responding to the Order’s request that he attest to “the maximum
number of violations supporting statutory damages that plaintiff intends to assert on his own
behalf,” see Order at 1, Zuckman stated that “I intend to prosecute any individual claims I have
for purchases made in Washington, DC.” Zuckman Aff. ¶ 9. In his supplemental brief, Zuckman
again makes clear that his complaint only asserts claims for cans purchased in the District. See
Supplemental Br. in Supp. of Pl.’s Mot. for Remand [Docket Entry 16] at 2 & n.2 (June 10,
2013) (“Pl.’s Supplemental Br.”) (“Plaintiff does not assert CPPA claims for purchases made
outside of Washington, DC.”).
If the only violations Zuckman asserts are based on cans he purchased in the District of
Columbia, the damages sought for statutory violations fall well short of the amount-in-
controversy requirement. The parties’ dispute thus centers on the proper reading of Zuckman’s
complaint and subsequent representations. Monster contends that, in addition to the advertising
viewed, all of the cans, including those purchased in Maryland, must count for assessing the
amount in controversy. See Def.’s Supplemental Br. in Opp’n to Pl.’s Mot. for Remand [Docket
Entry 15] at 2-5 (June 10, 2013) (“Def.’s Supplemental Br.”).
Zuckman’s complaint itself is not clear as to the “violations” he asserts as a basis for
statutory damages. It is fairly read, however, to bring an action based only on cans he purchased
in the District. For example, Zuckman repeatedly makes reference to his purchases “in the
District of Columbia,” and he omits specific mention of cans purchased in Maryland. See Compl.
¶ 1 (“[Zuckman] has viewed advertising for, and regularly purchased Monster Energy drinks
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manufactured by Defendant, in the District of Columbia.”); id. ¶ 7 (“Mr. Zuckman has viewed
advertising for, and regularly purchased Monster Energy drinks in the past in the District of
Columbia.”). Moreover, Zuckman also describes his claim in this manner in the motion for
remand, characterizing the complaint as requesting various types of relief for Monster Energy
drinks purchased “in the District of Columbia.”1 See Pl.’s Mot. for Remand for Lack of Subject
Matter Jurisdiction [Docket Entry 9] at 2 (Jan. 9, 2013) (“Pl.’s Mot. for Remand”). The
complaint is also ambiguous as to whether the advertising viewed forms a separate violation.
Although the complaint discusses Monster’s allegedly misleading advertisements, Zuckman
never expressly indicates that he interprets viewing these advertisements as violations that would
independently support statutory damages. See Compl. ¶ 42 (asking for statutory damages “per
violation” without specifying what a violation is); id. at 11 (asking for relief based on
“Defendant’s conduct”).
To the extent there remains doubt about the contours of Zuckman’s claims, his
representations in the affidavits and briefing resolve the question. Counting the Maryland cans
would put the amount in controversy over $75,000. Zuckman, however, stipulates (in response to
the Court’s question about “maximum” violations) that he “intend[s] to prosecute any individual
claims [he has] for purchases made in Washington, DC,” see Zuckman Aff. ¶ 9, and that he
“does not assert CPPA claims for purchases made outside of Washington, DC.” See Pl.’s
Supplemental Br. at 2 n.2.2 He also stipulates that he does not seek statutory damages based on
instances of advertising viewed. See Pl.’s Reply at 3 (Zuckman stating that he “never made” the
1
It is not surprising that Zuckman would circumscribe his complaint to include only those cans purchased in the
District, for it is far from clear that the DCCPPA would allow recovery for cans purchased in Maryland. See Nelson
v. Nationwide Mortg. Corp., 659 F. Supp. 611, 616-17 (D.D.C. 1987) (“[T]he Court will not presume that the
[DCCPPA] was intended to apply to every commercial transaction involving a District of Columbia resident,
wherever and with whomever that transaction occurs.”).
2
Zuckman further stipulates that his claims only relate to his 3 to 5 purchases of the original Monster Energy drink
flavor, see id. at 2, although this further limitation is not critical to the jurisdictional question.
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“fanciful argument that [his] case includes statutory damages for each time he ‘viewed
advertising in this District’ and that such ‘views’ should each be considered a separate
violation”).
Resisting this conclusion, Monster invokes St. Paul Mercury Indemnity Co. v. Red Cab
Co., 303 U.S. 283 (1938), to argue that Zuckman cannot now make representations to reduce the
amount in controversy below the jurisdictional minimum. See Def.’s Supplemental Br. at 2 &
n.2. But St. Paul Mercury turned on the fact that the complaint was facially clear in requesting an
amount of damages above the jurisdictional minimum—the complaint there expressly sought an
amount greater than required under the then-governing statute, see 303 U.S. at 284, and the
Supreme Court held that “a subsequent amendment, reducing the sum claimed to substantially
less than that amount,” did not warrant remand to state court. See id.; see also id. at 296 (holding
that “[o]n the face of the pleadings petitioner was entitled to invoke the jurisdiction of the federal
court and a reduction of the amount claimed after removal[] did not take away that privilege”).
The Supreme Court reasoned that a subsequent amendment to the complaint cannot defeat
jurisdiction because at the time of removal the jurisdictional requirement was satisfied. See id. at
289-90 (“Events occurring subsequent to the institution of suit which reduce the amount
recoverable below the statutory limit do not oust jurisdiction.”); see also id. at 291 (“[T]he status
of the case as disclosed by the plaintiff’s complaint is controlling in the case of a removal, since
the defendant must file his petition before the time for answer or forever lose his right to
remove.”).
But this timing problem does not arise when the complaint is initially ambiguous, and
plaintiff’s stipulations merely clarify what the complaint has asserted from the outset. See
Meritcare Inc. v. St. Paul Mercury Ins. Co., 166 F.3d 214, 223 (3d Cir. 1999) (“Although a court
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can make an independent appraisal of the reasonable value of the claim . . . it might also consider
a stipulation as clarifying rather than amending an original pleading.” (emphasis added) (citation
and internal quotation marks omitted)), abrogated on other grounds by Exxon Mobil Corp. v.
Allapattah Servs., Inc., 545 U.S. 546 (2005); ANPAC v. Dow Quimica de Colombia S.A., 988
F.2d 559, 565 (5th Cir. 1993) (“Although . . . a plaintiff may not defeat removal by subsequently
changing his damage request . . . in this case the affidavits clarify a petition that previously left
the jurisdictional question ambiguous.” (citing St. Paul Mercury, 303 U.S. at 292)), abrogated on
other grounds by Marathon Oil Co. v. Ruhrgas, 145 F.3d 211 (5th Cir. 1998), rev’d, 526 U.S.
574 (1999). In instances where the complaint is ambiguous, the plaintiff—who is, after all, the
master of his complaint—may hence clarify the amount in controversy with affidavits or
stipulations. See Standard Fire Ins. Co. v. Knowles, 133 S. Ct. 1345, 1350 (2013) (“[F]ederal
courts permit individual plaintiffs, who are the masters of their complaints, to avoid removal to
federal court, and to obtain a remand to state court, by stipulating to amounts at issue that fall
below the federal jurisdictional requirement.”). Zuckman’s stipulations here clarify his
ambiguous complaint.
To be sure, to be effective, a stipulation “must be binding.” Id. at 1348; see also 14AA
Charles Alan Wright et al., Federal Practice and Procedure § 3702.1, at 335 (4th ed. 2011)
(federal court can insist on a “binding affidavit or stipulation that the plaintiff will continue to
claim less than the jurisdictional amount” as condition for remand). That requirement, too, is
satisfied. Here, Zuckman’s affidavits, along with the stipulations in his supplemental brief, will
be binding under the doctrine of judicial estoppel: he has represented that he is not seeking
statutory damages based on cans purchased in Maryland or based on advertisements viewed, and
this representation is necessary to the Court’s present decision. See Moses v. Howard Univ.
8
Hosp., 606 F.3d 789, 798 (D.C. Cir. 2010) (setting forth requirements for applying judicial
estoppel). Moreover, all that is at issue here are fees that can be ascribed to Zuckman’s
individual claims. Accordingly, Zuckman’s stipulations relate only to these claims, and there is
no doubt that he has the power to bind himself in this way. See Standard Fire Ins. Co., 133 S. Ct.
at 1350.
Because Zuckman has made clear, in binding stipulations in his briefs and affidavits, that
he is asserting individual claims based only on cans of Monster Energy he purchased in the
District of Columbia, he will be limited to claims based on these purchases in future proceedings.
The purchases in the District are hence the only ones relevant for the calculation of statutory
damages. Zuckman attests that he purchased “approximately 3 to 5 cans of the original flavor
[of] Monster Energy Drink,” and “between 15 and 20 cans total.” See Zuckman Aff. ¶¶ 6, 8.
Taking the largest of these numbers, if Zuckman purchased 20 cans, at $1,500 per violation, the
amount put into controversy by his request for statutory damages is $30,000.
B. Attorney Fees
Zuckman also requests recovery of reasonable attorney fees under the DCCPPA. See
Compl. ¶ 42. Monster argues that the fees in this case will themselves exceed the $75,000
threshold for establishing diversity jurisdiction. See Def.’s Opp’n at 7. In an affidavit,
Zuckman’s lawyers attest that they have spent approximately 197 hours on the case through May
30, 2013, and they forecast spending “at least 1,750 hours” on the case if it proceeds to trial. See
Aff. of Mila F. Bartos [Docket Entry 14] ¶¶ 6-7 (May 30, 2013). Given this information and his
attorneys’ billing rates, Zuckman acknowledges that if he succeeds at trial the aggregate attorney
fees recoverable would exceed $75,000. See Pl.’s Supplemental Br. at 2-3.
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Attorney fees are part of the amount in controversy if they are provided for by statute or
contract. See Mo. State Life Ins. Co. v. Jones, 290 U.S. 199, 202 (1933); Breakman, 545 F.
Supp. 2d at 107. Since the DCCPPA allows for recovery of reasonable attorney fees, see D.C.
Code § 28-3905(k)(2)(B), Zuckman’s fees are appropriately considered part of the amount in
controversy. As he correctly argues, however, his fees cannot be aggregated with those of the
general public in order to satisfy the $75,000 threshold. See Kessler v. Nat’l Enters., Inc., 347
F.3d 1076, 1080 (8th Cir. 2003) (noting that “fees cannot be aggregated to meet the amount-in-
controversy requirement” (internal quotation marks omitted)); Nat’l Consumers League v. Gen.
Mills, Inc., 680 F. Supp. 2d 132, 141 (D.D.C. 2010) (explaining that “aggregation of attorneys’
fees is not appropriate in a CPPA case”). Rather, the Court may consider only Zuckman’s share
of the total fees when calculating the amount in controversy. This, in turn, raises the question of
how to determine Zuckman’s share—i.e., what percentage of the attorney fees can be attributed
to claims Zuckman brings on behalf of himself.
Zuckman argues that the fees should be apportioned between him and the general public
on a pro rata basis, and that the total fees (calculated by multiplying the hours worked by the
hourly rates) should be divided by all the individuals who would benefit from the judgment. See
Pl.’s Mot. for Remand at 7. This approach may underestimate the portion of fees properly
attributed to Zuckman in his role as the initial plaintiff—Zuckman, after all, likely would have
still chosen to bring this suit even if he could assert only individual claims, and the work required
of his attorneys would be substantially more than the pro rata portion of the total hourly fees. A
preferable approach is to consider the attorney fees that Zuckman’s individual claims support by
calculating a reasonable contingency fee—say, 33%, see City of Riverside v. Rivera, 477 U.S.
561, 573 (1986)—that would accompany a full judgment in his favor. Such an approach is
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particularly fitting here because Zuckman’s lawyers are working on a contingency fee basis, and
hence any recoverable attorney fees are inherently connected to the monetary value of the
claims. Allocating the fees in this manner also strikes a proper balance between ensuring that
Zuckman’s expenditures on attorney fees are not undervalued or diluted, and preventing the fees
from driving the amount in controversy, a concern that this Court expressed in Breakman. See
545 F. Supp. 2d at 107 (“[T]he Court is not entirely comfortable with the premise that an action
should be retained in federal court where satisfaction of the amount in controversy requirement
depends upon a lump sum award of attorneys’ fees.”).
Adopting this approach, if Zuckman recovers the full $30,000 in statutory damages for
the 20 cans he purchased in the District, his attorney fees would total $10,000.
C. Injunctive Relief
In addition to statutory damages and attorney fees, Zuckman also seeks an “injunction
preventing Monster from continuing to mislead the DC General Public, and requiring them to
disclose [] that Monster Energy drinks have not been found to be ‘completely safe’ and that its
disparate ingredients can have negative health effects.” See Compl. ¶ 41. Monster maintains that
if it were ordered to comply with this request and state that its products are unsafe, it would
suffer more than $75,000 in lost revenue. See Def.’s Opp’n at 11. Consequently, Monster
contends that Zuckman’s claims for injunctive relief satisfy the amount-in-controversy
requirement. See id.
The parties dispute whether the cost of relief should be measured from the perspective of
the plaintiff or defendant. Whatever perspective is used, they also disagree as to how the cost
should be apportioned here given the claims on behalf of the general public. The Court need not
resolve these issues, however, because Monster’s claims about the costs are too speculative to
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serve as the basis for determining the amount in controversy. Courts have found that general
assertions that the cost of injunctive relief would exceed $75,000 are too speculative to establish
diversity jurisdiction. See Nat’l Consumers League, 680 F. Supp. 2d at 140 (holding that
defendant’s claim that the cost of injunctive relief would exceed $75,000 was “too speculative”);
Wexler v. United Air Lines, Inc., 496 F. Supp. 2d 150, 154 (D.D.C. 2007) (finding defendant’s
claim that “the total cost ‘is certain’ to exceed $75,000” insufficient to establish jurisdiction).
Here, Monster merely asserts that complying with the injunction would cause it to “suffer
a decrease in revenue in an amount greater than $75,000.” See Def.’s Opp’n at 14. It argues that
“[t]his conclusion follows logically from the fact that [defendant] sold more than $2,000,000 of
Monster Energy products in the District of Columbia” in the three years before the complaint
was filed. See id. As an initial matter, and as Zuckman points out, courts have held that it is
improper to consider a decrease in future revenue as a cost of complying with an injunction. See,
e.g., Snow v. Ford Motor Co., 561 F.2d 787, 790 (9th Cir. 1977) (holding that injunctive relief
does not meet the amount in controversy when the “only reason the injunction is worth more
than [the jurisdictional minimum]” is that it would affect defendant’s future sales). As a result,
Monster’s contention that complying with the injunction will cause it to suffer a “future decrease
in sales of more than $75,000” will not suffice to establish jurisdiction. See Def.’s Opp’n at 15.
Even if future lost profits were considered, however, Monster’s claims about these costs
are still too speculative to satisfy the amount-in-controversy requirement. While it argues that it
need not supply specific evidence showing the costs of relief, see id. at 14-15, the case law
indicates otherwise. In Wexler, Judge Kessler held that the defendant’s costs were too
speculative when it offered a list of obligations it would have to fulfill if the injunction were
granted, but “provide[d] no evidentiary support for the cost of each obligation,” merely asserting
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that the total would exceed $75,000. See 496 F. Supp. 2d at 154. And in National Consumers
League, Judge Kennedy determined that the defendant’s estimated costs of injunctive relief
proved too speculative where it asserted that “‘to the extent that relief requires the removal of
boxes of store shelves, the expense to [the defendant] would exceed $75,000.’” 680 F. Supp. 2d
at 140. In the instant case, beyond making general assertions about a decrease in revenue,
Monster provides no evidence about how the disclaimer Zuckman seeks would affect sales, how
consumers and competitors would respond, how it would alter the price of its product, or how
these losses would translate into lost profits. With so little information, the Court has no basis to
assess Monster’s expected losses. Monster’s general assertions are thus too speculative to
establish the cost of injunctive relief, and the Court will hence not consider any such costs.
D. Restitution
Zuckman also seeks restitution on behalf of himself and the general public for their
purchases of Monster Energy drinks. See Compl. at 11; Pl.’s Mot. for Remand at 13. Restitution
claims, like claims for statutory damages or attorney fees, generally cannot be aggregated for
purposes of satisfying the amount-in-controversy requirement. See Snyder, 394 U.S. at 335
(holding that the “separate and distinct claims of two or more plaintiffs cannot be aggregated” to
establish jurisdiction); see also Georgiades v. Martin-Trigona, 729 F.2d 831, 833 (D.C. Cir.
1984) (“Separate and distinct claims, regardless of whether they share a community of interest or
originate in a single transaction or event, may not be aggregated . . . .”). However, there is an
exception to this rule in cases where “two or more plaintiffs unite to enforce a single title or right
in which they have a common and undivided interest,” Snyder, 394 U.S. at 335, such as when
claimants seek disgorgement of money obtained through unlawful trade practices. See Aetna
U.S. Healthcare, Inc. v. Hoechst Aktiengesellschaft, 48 F. Supp. 2d 37, 40-41 (D.D.C. 1999). In
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these instances, aggregation of claims is permissible. See id. Hence, the key issue here is whether
Zuckman’s request for restitution is effectively a claim of disgorgement.
In an action for disgorgement, members of the class seek to remedy a defendant’s unjust
enrichment from illegal practices, requesting the return of “a certain sum of money . . . because it
would be inequitable for defendants to keep this sum.” See id. at 40 (internal quotation marks
omitted). Rather than redress an individual plaintiff’s specific injury, disgorgement claims seek
to hold defendants generally “liable for a refund of all moneys acquired” as a result of their
illegal activities. See Williams v. Purdue Pharma Co., No. 02-0556, 2003 WL 24259557, at *5
(D.D.C. Feb. 27, 2003) (internal quotation marks omitted). Because of their indivisible nature,
claims for disgorgement are integrated claims that can be aggregated in order to determine the
amount in controversy. See Aetna, 48 F. Supp. 2d at 40-41. Where “separate and distinct claims
are asserted on behalf of a number of individuals,” by contrast, the claims are not properly
aggregated. See Breakman, 545 F. Supp. 2d at 103. In these instances, the plaintiff seeks
“damages for individual consumers, not disgorgement,” which would “establish a joint or
common right in a common fund.” See Reigner v. Ingersoll-Rand Co., 461 F. Supp. 2d 1, 2
(D.D.C. 2004); see also Breakman, 545 F. Supp. 2d at 104. Aggregating restitution claims is
therefore improper.
Here, Zuckman requests that the Court “grant[] [him] and the General Public of the
District of Columbia restitution for their purchases as provided for by the CPPA.” See Compl. at
11. He seeks restitution for the amount paid by, and owed to, each D.C. purchaser of Monster
Energy drinks, rather than a lump, undivided sum, possessed by Monster. Citing Williams and
Aetna, Monster responds that, like the claims in those cases, Zuckman’s request for restitution
seeks a common and undivided sum and thus possesses the defining characteristics of an
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aggregable disgorgement claim: his restitution request “will not turn on the number of purchasers
of Monster Energy, the number of purchases by any one consumer, or consumers’ decisions to
collect or not to collect from the restitutionary sum,” but will “depend[] solely on the volume of
sales of Monster Energy products” in the District. See Def.’s Opp’n at 16. This is an inaccurate
characterization of Zuckman’s claim. He is asserting “separate and distinct claims” on behalf of
himself and the general public for “their purchases” of Monster Energy. See Compl. at 11.
Rather than seeking the return of all Monster’s allegedly unlawful profits—a fixed sum of money
to be disgorged regardless of the number of plaintiffs—Zuckman requests specific and
individualized relief based on each can purchased by the individual plaintiffs represented in this
action.3 Contrary to Monster’s arguments, then, the amount of the restitution claim will depend
on the number of purchasers of Monster Energy, and how many cans each of them bought.
Zuckman’s claim is therefore unlike those in Aetna and Williams, in which members of the class
sought to remedy the defendant’s unjust enrichment, seeking the return of a fixed sum of money
obtained through allegedly illicit means. Hence, the restitution claims here cannot be aggregated,
and only Zuckman’s individual claim counts toward the amount in controversy.
Assuming that each can of Monster Energy cost $3, see Pl.’s Mot. for Remand at 2, and
that Zuckman purchased 20 cans in the District of Columbia, his restitution claim amounts to
$60. Combining the monetary value of this claim with the $30,000 in statutory damages and
$10,000 in attorney fees, Zuckman’s requests for relief add up to $40,060—well below the
$75,000 jurisdictional minimum. This Court thus does not have diversity jurisdiction over this
action.
3
To be sure, the sum of the purchases will, in fact, equal Monster’s total sales in the District of Columbia because
all individuals who purchased cans in the District are included in Zuckman’s claims. But that does not mean that the
total sales figure is driving the amount of the request. It is not. Zuckman’s claims are clearly framed from the
perspective of the consumers and dependent on the money they expended. Moreover, the total sales figure is
meaningless as a starting point—unlike a request for all of an entity’s profits, the total sales figure says nothing
about illicit gains from an allegedly improper transaction.
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II. Class Action Fairness Act
Monster also contends that this case lies within the Court’s subject-matter jurisdiction
pursuant to the Class Action Fairness Act. See Def.’s Opp’n at 19. Zuckman counters that
because he filed this case as a representative action under the DCCPPA, and because he did not
attempt to comply with the D.C. Superior Court’s rules for filing class action lawsuits, his case is
not a removable class action under the Act. See Pl.’s Mot. for Remand at 15. The Court agrees.
As this Court has previously recognized, “[t]he DCCPPA specifically authorizes a private
attorney general suit without any reference to class action requirements.” Breakman, 545 F.
Supp. 2d at 101. Because the plaintiff in that case did not attempt to comply with Rule 23 of the
D.C. Superior Court Rules of Civil Procedure, did not seek class action certification, and
specifically stated that he was bringing his case as a representative action under the DCCPPA,
the Court concluded that the action was a “separate and distinct procedural vehicle from a class
action.” See id. A similar analysis applies here. Zuckman brought his case as a representative
action under the private attorney general provision of the DCCPPA, he did not refer to his claim
as a class action, and did not seek to comply with any of the D.C. Superior Court’s class action
rules. See Pl.’s Mot. for Remand at 15 (“As is evident from the Complaint, this case is not a class
action . . . .”). Hence, his case does not qualify as a class action under the Class Action Fairness
Act, and the Court cannot exercise jurisdiction pursuant to that statute.
Contending that the Court should deviate from the analysis in Breakman, Monster
maintains that a recent D.C. Superior Court case alters the landscape. That case held that
DCCPPA claims for damages on behalf of the public could not be brought “without invoking
and complying with the requirements for class actions set forth in Rule 23 of the Superior Court
Rules of Civil Procedure.” Margolis v. U-Haul Int’l, Inc., No. 2007 CA 005245 B, 2009 WL
16
5788369, at *1-2 (D.C. Super. Ct. Dec. 17, 2009).4 Because the complaint in Margolis “was not
formally framed as a class action and did not include the class action allegations required by
Rule 23,” id. at *3, the D.C. Superior Court dismissed Margolis’s claims “for money damages
under the CPPA on behalf of third parties,” but allowed his individual claims for damages and
claims for injunctive relief on behalf of the public to proceed. See id. at *2. Relying on this
holding, Monster contends that this case is a putative class action under CAFA because “it must
be litigated pursuant to Rule 23 of the Federal Rules of Civil Procedure.” See Def.’s Opp’n at 20.
But how this case “must” be litigated is a merits question to be assessed at the motion to
dismiss stage. What matters for purposes of jurisdiction, by contrast, is whether this was an
“action filed under rule 23” or a state equivalent—i.e., how the action was actually filed, rather
than how it should have been filed to state a claim for all the relief sought. See 28 U.S.C
§ 1332(d)(1)(B) (emphasis added); see also Purdue Pharma L.P. v. Kentucky, 704 F.3d 208, 214
(2d Cir. 2013) (“To qualify as a ‘class action’ within the meaning of CAFA, the action must be
filed under a statute or rule that is both similar to Rule 23 and authorizes the action to proceed
‘as a class action.’”). As discussed above, it is evident here that Zuckman did not, in fact, file the
action under Rule 23 of the D.C. Superior Court Rules of Civil Procedure or Rule 23 of the
Federal Rules of Civil Procedure; the complaint is not labeled a class action, nor does it seek
certification of any class or allege that Rule 23’s requirements, such as numerosity and typicality,
have been met. See Fed. R. Civ. P. 23; D.C. Sup. Ct. R. 23. Nor does the DCCPPA qualify as a
statute similar to Rule 23 that itself carries the requisite procedural safeguards. Indeed, such an
argument contradicts the very holding of Margolis—if the DCCPPA itself provided class action
4
The Westlaw version of the case is not paginated; the Court will use the pagination on the printed decision, which
Monster has included as Exhibit D to its Notice of Removal.
17
safeguards, the Margolis claim for money damages on behalf of third parties should have been
permitted to proceed. Instead, it was dismissed. See Margolis, 2009 WL 5788369, at *8.
Perhaps—if other D.C. local courts follow the Margolis decision—Zuckman’s damages
claim on behalf of the general public will be dismissed because he did not file his action under
Rule 23. But the Court cannot somehow convert Zuckman’s complaint into a class action on the
assumption that, faced with possible dismissal of the damages claim on behalf of the general
public, he would choose to file this case under Rule 23. “[C]lass actions are permissive, not
mandatory,” Sprint Commc’ns Co. v. APCC Servs., Inc., 554 U.S. 269, 291 (2008), and it is
Zuckman’s strategic choice, in light of the Margolis decision, its precedential weight, and his
other claims, to proceed without invoking Rule 23. The Court will not second-guess such a
choice (nor is it evident what authority it would have to do so). Because Zuckman did not file
this action as a class action, his claim falls outside CAFA pursuant to its plain text.5
CONCLUSION
Because there is no diversity jurisdiction over this case, and because it does not fall under
the Class Action Fairness Act, the Court will grant Zuckman’s motion for remand for lack of
subject-matter jurisdiction.
/s/
JOHN D. BATES
United States District Judge
Dated: August 6, 2013
5
Where an action is not filed as a class action, it may still be removable under CAFA if it satisfies the requirements
of a “mass action.” See 28 U.S.C. § 1332(d)(11)(A). But Monster expressly states that it did not seek removal on
this basis, see Def.’s Opp’n at 23, and it does not attempt to show that the “mass action” prerequisites are met.
Moreover, a DCCPPA claim like Zuckman’s would likely fall into an exception to the “mass action” provision that
applies where “all of the claims in the action are asserted on behalf of the general public (and not on behalf of
individual claimants or members of a purported class).” See 28 U.S.C. § 1332(d)(11)(B)(ii)(III); see also Breakman,
545 F. Supp. 2d at 101.
18