Guglielmino v. McKee Foods Corp., 506 F.3d 696 (9th Cir. 2007)

Plaintiffs sued McKee Foods in this putative class action in state court, alleging violation of the California Labor Code, fraud, breach of contract and related claims. McKee timely removed the action to federal court and asserted that even though plaintiffs affirmatively alleged that the damages suffered by each of them were less than $75,000 (the jurisdictional minimum for federal court jurisdiction in a diversity case such as this), the damages in fact exceeded $75,000 when alleged economic damages, attorneys’ fees and punitive damages were included. The district court denied plaintiffs’ motion to remand on the ground that McKee had established by a preponderance of the evidence that the damages exceeded $75,000 for each plaintiff. The Ninth Circuit affirmed the judgment. Cf. Ryman v. Sears, Roebuck & Co., 505 F.3d 993 (9th Cir. 2007) (when a federal court is required to apply state law and there is no relevant precedent from the state’s highest court, the federal court should follow the law as indicated by the state’s intermediate appellate court).