Home Depot U.S.A. Inc. v. Jackson

Whether an original defendant to a class-action claim can remove the class action if it otherwise satisfies the jurisdictional requirements of the Class Action Fairness Act when the class action was originally asserted as a counterclaim against a co-defendant.

This suit was initiated when Citibank, N.A. filed a state court collection proceeding against Respondent, who then brought class action claims against two parties, including Petitioner. Petitioner removed the case to federal court, citing the Class Action Fairness Act of 2005 (CAFA) which allows “any defendant” in a state-court class action to remove the action to federal court if the case meets jurisdictional requirements. The district court granted Respondent’s motion to remand to state court, concluding that Petitioner did not meet the CAFA’s definition of “defendant.” The Fourth Circuit affirmed. The U.S. Supreme Court has granted certiorari to determine whether Petitioner falls within the definition of “any defendant” for purposes of the CAFA. In Shamrock Oil & Gas Co. v. Sheets, 313 U.S. 100 (1941), the Supreme Court held that a party who was not an original defendant may not remove a counterclaim filed against it. While four circuits have extended the scope of the Shamrock Oil & Gas Co. holding to prohibit third-party counterclaim defendants from removing to federal court, Petitioner argues that this interpretation is too broad. Petitioner asserts that third-party defendants should be permitted to remove to federal court because based on the plain text of the statute, Congress’s inclusion of the word “any” before “defendants” indicates an expansive definition of “defendants.”