Cruz-Alvarez and Canfield Explain Ninth Circuit CAFA Ruling

Shook, Hardy & Bacon Partner Frank Cruz-Alvarez and Associate Rachel Canfield discuss Allen v. Boeing, a Ninth Circuit decision reaffirming an interpretation of the "single local event" exception of the Class Action Fairness Act (CAFA), in an article for the Washington Legal Foundation's Legal Pulse. The exception provides that claims arising from an event in the state in which the lawsuit was filed and affecting only that state or contiguous states are excluded from CAFA's mass action jurisdiction.

The court had to determine the definition of an "event," Cruz-Alvarez and Canfield note, because the "event" at issue in Allen involved decades of alleged groundwater contamination. Splitting with other circuits, the Ninth Circuit found a broader definition to be inconsistent with the structure of CAFA and the legislative history accompanying it, preferring to define an "event" as a "a single happening." The Third Circuit had previously interpreted an event to be established "“where the record demonstrates circumstances that share some commonality and persist over a period of time," while the Fifth Circuit had defined the word as a "continuous pattern that led to a single event."

"To be sure, if the Ninth Circuit and other circuit courts follow Allen, the decision will open the door for the removal of more mass actions to federal court," Cruz-Alvarez and Canfield write. "Allen broadens the scope of CAFA mass action jurisdiction by limiting application of the single local event exception."