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Davy v. Duke Energy Carolinas, LLC

United States District Court, D. South Carolina

March 4, 2016

Frederick Charles Davy and Sharon Lee Davy, and on behalf of a Class of Individuals Similarly Situated Plaintiffs,
Duck Energy Carolinas, LLC, et al., Defendants.


Mary Geiger Lewis United States District Judge

Plaintiffs brought this putative class action in Spartanburg County, South Carolina Court of Common Pleas on November 12, 2015. (ECF No. 1-1). On December 11, 2015, Defendants removed the action to this Court, asserting both federal diversity jurisdiction pursuant to 28 U.S.C. § 1332(a) and 1441(a) and federal jurisdiction pursuant to “CAFA, ” the Class Action Fairness Act, as codified at 28 U.S.C. §§ 1332(d) and 1453. (ECF No. 1).

The matter now comes before the Court on Plaintiffs’ Motion to Remand, (ECF No. 25), filed on January 11, 2016. Defendants Duke Energy Carolinas, LLC, (“Duke Energy”), Energy Conservation Solutions, Inc., (“Energy Solutions”), and Greensky Trade Credit, LLC, (“GreenSky”), each responded in opposition. (ECF Nos. 39-41). Also pending with the Court are the respective Motions to Dismiss, (ECF Nos. 30, 31, and 33), of Defendants Duke Energy, Greensky, and Spartanburg County Building Codes and Fire Services. (“Spartanburg County”). The Court has carefully considered all of the pleadings, motions and memoranda of the parties relevant to these pending matters, and these matters are now ripe for disposition.


After filing the current, operative Amended Complaint in this action, (ECF No. 22), Plaintiffs moved for remand. (ECF No. 25). In their brief in support of remand, Plaintiffs maintain that the removal from Spartanburg County of their prior state court filed Complaint was defective under 28 U.S.C. § 1332(d)(4), a provision of CAFA sometimes referred to as the “local controversy exception.” (ECF No. 25-1 at pp. 3-4). Having reviewed the parties’ submissions on this matter, however, the Court has little trouble concluding that federal jurisdiction exists, and that Plaintiffs’ Motion to Remand, (ECF No. 25), is properly DENIED.

CAFA amended federal diversity requirements to establish a more lenient standard for removal of class actions. See Johnson v. Advance America, 549 F.3d 932, 935 (4th Cir. 2008). In order to establish federal jurisdiction under CAFA, removing defendants need only show that: (1) the putative class has more than 100 members; (2) the parties are minimally diverse; and (3) the amount in controversy exceeds $5 million. Dart Cherokee Basin Operating Co., LLC, v. Owens, 135 S.Ct. 547, 552 (2014) (citing 28 U.S.C. § 1332(d)(2)). Contrary to Plaintiffs’ assertion, there is no anti-removal assumption where the basis of removal is CAFA. Indeed, if a matter has been properly removed, CAFA’s provisions should be read broadly, with a strong preference that interstate class actions be heard in federal court. Id. at 554.

In their brief, Plaintiffs do not appear to dispute that the above three basic requirements for CAFA jurisdiction are met. Instead, they argue that the Court should nonetheless decline to exercise jurisdiction pursuant to 28 U.S.C. § 1332(d)(4), the so-called “local controversy exception.” See ECF No. 25-1 at pp. 5-6. This provision provides that a district court should refuse jurisdiction over any putative class in which, among other features, more than two-thirds of the class members are citizens of the State [here South Carolina] in which the action was originally filed. Importantly, however, Plaintiffs mistakenly maintain that the burden of establishing this greater than two-thirds local citizenship requirement (along with the several other prongs of § 1332(d)(4)) rests with removing defendants. See Id. As Defendants note in their papers, once the basic jurisdictional requirements of CAFA are established, the burden shifts to Plaintiffs to prove out any CAFA exception. See Estate of Hanna v. Agape Senior, LLC, 2015 WL 247906 at *1 (D.S.C. Jan 20, 2015); Mungo v. Minnesota Life Ins. Co., 2011 WL 2516934 at *2 (D.S.C. June 23, 2011) (finding that “[P]laintiff has not alleged that the general requirements [of CAFA] are not met in this case. Instead, she argues that the local controversy exception to CAFA jurisdiction applies. The burden is on her to establish this exception by a preponderance.”) (emphasis added).

Applying these basic principles to the instant case, it is clear that Plaintiffs have not carried their burden of establishing by a preponderance of the evidence all of the elements of the local controversy exception, including the critical first element. Plaintiffs advise in their memorandum of law that “to the best knowledge available to [them], greater than two-thirds of the members of the Plaintiff Class are South Carolina citizens.” (ECF No. 25-1 at p. 6). However, Plaintiffs provide no evidence in support of this bare assertion in their memo. Nor do Plaintiffs point to any language in any version of the Complaint (whether the first Amended Complaint, operative on the date of removal, or the second Amended Complaint, filed thereafter in this Court) that describes or limits the scope of the putative class in this regard.

For the foregoing reasons, therefore, Plaintiffs’ Motion to Remand, (ECF No. 25), is DENIED.


Having determined that jurisdiction is valid, the Court will now turn to a consideration of the respective Motions to Dismiss filed by Defendants Duke Energy, (ECF No. 30), Spartanburg County, (ECF No. 31), and Greensky. (ECF No. 33).

Standard of Review

Federal Rule of Civil Procedure 8(a)(2) provides that a pleading must contain a “short and plain statement of the claim showing that the pleader is entitled to relief.” “A motion to dismiss under Rule 12(b)(6) for failure to state a claim upon which relief can be granted is a challenge to the legal sufficiency of a complaint, as governed by Rule 8.” Federal Trade Commission v. Innovative Marketing, Inc., 654 F.Supp.2d 378, 384 (D. Md. 2009). “The court’s function on a Rule 12(b)(6) motion is not to weigh the evidence that might be presented at trial but merely to determine whether the complaint itself is legally sufficient.” Spear v. Ernst & Young, 1994 WL 585815, 2 (D.S.C. 1994) (quoting Goldman v. Belden, 754 F.2d 1059, 1067 (2d Cir. 1985)).

The United States Supreme Court has held that “[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007)). The Supreme Court explained that “[a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged, ” and noted that “[d]etermining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Id.; see also Harman v. Unisys Corp., 2009 WL 4506463 *2 (4th Cir. 2009). The Supreme Court added that while “[t]hreadbare recitals of the elements of ...

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