Ninth Circuit Defines Parameters for Removal of PAGA Actions

For purposes of removal based on diversity, California courts have been divided over whether a defendant must establish the $75,000 amount-in-controversy requirement based solely on civil penalties attributable to the plaintiff's individual claims or instead, whether a defendant can establish the minimum jurisdictional amount by aggregating the civil penalties attributable to the claims of all the aggrieved employees represented by the plaintiff in a Private Attorney General’s Act (PAGA) lawsuit. In Urbino v. Orkin Services of California, Inc., a divided panel of the U.S. Court of Appeals for the Ninth Circuit reversed a lower court decision and held that PAGA penalties cannot be aggregated for purposes of removal. Nevertheless, while the Ninth Circuit has resolved one disputed issue, its reasoning might well call into question other decisions interpreting the PAGA. For more about the Ninth Circuit’s decision and its implications, please see Littler’s ASAP, Ninth Circuit Defines Parameters for Removal of PAGA Actions, by Richard Rahm and Alison Cubre.

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