The Tenth Circuit Court of Appeals issued its opinion in Dudley-Barton v. Service Corp. Int’l on Thursday, July 28, 2011.
The Tenth Circuit affirmed the district court’s decision. Respondents filed a class action lawsuit against Petitioners, a large, multi-state funeral home operating company, based on its allegedly unlawful employment practices and policies. Respondents sought to recover unpaid wages based on Petitioner’s “purported failure to compensate its employees for (1) time spent engaging in community work outside of regular employment hours; (2) time spent handling phone calls and other work-related issues after normal business hours; (3) time spent working through meal breaks; and (4) overtime hours worked. . . . In making these assertions, Plaintiffs brought four claims for violation of Colorado wage and labor laws, . . . as well as state law claims for breach of contract, fraud, unjust enrichment, breach of the implied covenant of good faith and fair dealing, conversion, and misrepresentation.”
Petitioners removed the case to federal court pursuant to the Class Action Fairness Act (CAFA), and Respondents then filed a motion to remand. The district court granted Respondents’ motion to remand, concluding that Petitioners had not established that the amount in controversy exceeded the $5 million jurisdictional threshold required. Respondents then filed a timely petition in the Tenth Circuit requesting leave to appeal the district court’s remand order. Before the Court granted the petition, Respondents filed in Colorado state court a notice voluntarily dismissing their claims against Petitioners without prejudice. The state court dismissed the case that same day. After, the Court granted Petitioners’ petition for leave to appeal. Two weeks later, Respondents filed a motion to dismiss Petitioners’ appeal, claiming that the appeal is now moot.
Respondents rely on their voluntary dismissal filed pursuant to Rule 41(a) of the Colorado Rules of Civil Procedure to argue that Petitioners’ appeal is moot and subject to dismissal. “Rule 41(a) states that plaintiffs may dismiss an action ‘without order of [the] court upon payment of costs . . . [by] filing a notice of dismissal at any time before filing or service by the adverse party of an answer or of a motion for summary judgment.’” Respondents argue that because Petitioners have not filed an answer or a motion for summary judgment, their notice of dismissal automatically terminated this case. Petitioners oppose Respondents’ motion to dismiss and argues that Plaintiffs may not moot its appeal by dismissing their lawsuit in state court.
The Court has not previously addressed whether the federal appeal of a remand order becomes moot following the plaintiff’s voluntary dismissal of the case in state court. “In the context of the present case, [the Court concluded] that when a plaintiff voluntarily dismisses its claims in state court, the pending federal appeal of the district court’s order of remand filed pursuant to 28 U.S.C. § 1453(c) becomes moot. Because [Respondents] have voluntarily dismissed their claims against [Petitioners], there is no meaningful dispute remaining between the parties: [Petitioners] have no material interest in contesting the district court’s remand order because [Respondents]’ lawsuit has now been dismissed. Further, since [Respondents] no longer have outstanding claims against [Petitioners], [the Court] cannot grant meaningful relief to [Petitioners] by reviewing the district court’s remand order.”